Economic performance

EC1 Direct economic value generated and distributed

Net sales in 2016 totalled SEK 40,316 million (40,242). Boliden has developed the description of the company’s value creation and has therefore redefined some of the economic indicators compared to previous GRI reports. All of the indicators are reported with two comparative years. Boliden also reports revenues and operating profit per Business Unit and country-by-country tax payments in the Annual Report.

Component,
SEK m

Stakeholder group

2014

2015

2016

 

Comment

Direct economic value generated    

   

a) Revenues

From customers

36,891

40,242

40,316

 

Net sales plus revenues
from financial investments and sales of assets.

Economic value distributed

   

b) Purchasing

To
suppliers

–31,552

–33,304

–30,340

 

Payments for materials, energy, machines, other components and services purchased.

c) Employee wages and benefits

To employees

–3,442

–3,480

–3,925

 

Total payroll and benefits
incl. employee taxes and funds on behalf of employees.

d) Payments to providers of capital

To shareholders, 
banks and institutions

–906

–1,127

–1,747

 

Dividends to shareholders
and interest payed to providers of loans.

e) Payment to government

To society

–572

–715

–1,135

 

Gross taxes.

Economic value retained

   

f) Retained earnings

Shareholders

967

1,677

1,688

 

Reinvestments or reserves.

EC2 Financial implications and other risks and
opportunities due to climate change

Boliden is impacted by the effects of climate change, and the effects are both physical and financial. The stress that heavy rain puts on Boliden’s water management systems is one example of a physical implication. Over the past years, heavy rains have led to capacity investments by Boliden in order to comply with the limits stipulated in relevant permits and to achieve the Group target of reducing discharges to water.

Metals production is a very energy-intensive process that generates both direct and indirect carbon dioxide emissions. Boliden’s direct carbon dioxide emissions primarily arise from the metallurgical processes, transportation, and heating requirements. The indirect carbon dioxide emissions derive from purchased electricity. To address the climate change issue, Boliden takes part in development projects focusing on, for example, improving heat recovery, the further electrification of transports, and trials involving replacing fossil fuels with biofuels in process applications.

All of Boliden’s smelter operations (Odda, Bergsöe, Rönnskär, Kokkola and Harjavalta) have been fully exposed to ETS, the European Emission Trading Scheme, since 2013. The ETS is a strong strategic challenge for Boliden, entailing not only calculating the costs that may be entailed in future purchases of emission allowances, but also working on opportunities to reduce emissions, given the production levels and available technology. The allocated emissions allowances for Boliden’s smelters for the period 2013–2020 total 3.9 Mtonnes, which is in line with the direct emissions forecast. The rules for emissions trading, and the financial implications for Boliden after 2020, are uncertain.

In 2013, the Group management formulated new targets for the stabilisation of Boliden’s carbon dioxide emissions until 2018. This target, expressed as intensity (tonne CO₂/tonne metal), is together with internal carbon budget pricing, a basis for evaluating investments and mitigation opportunities.

EC3 Benefit plan coverage

Pension undertakings

Boliden Group companies have various pension schemes in accordance with local conditions and practices in the countries in which they operate. They are generally financed through payments to insurance companies or through own provisions. Boliden has defined benefit plans in Sweden, and Ireland and a very small number of such plans in Norway. The defined benefit plan provides the employee with a fixed amount of their final salary in conjunction with the retirement. The pension costs for the year comprise service costs, financing costs, special payroll taxes, administrative costs and settlements/reductions of pension plans. Revaluations of the defined benefit net pension liability are reported under Other comprehensive income.

Costs, undertakings and other factors in pension plans are calculated by means of the Projected Unit Credit Method. The Group’s reported pension liability totals SEK 925 million (SEK 1,075 m) which sum includes endowment insurance totalling SEK 94 million (SEK 91 m) in respect of defined premium plans in Sweden.

Detailed information on provisions for pension and similar undertakings can be found in Note 23 of the Annual Report. Boliden is currently not able to report information in addition to that presented above.

/Static/img/omissions.svg Reason for omission: Data is unavailable

EC4 Financial assistance received from government

In 2016, government grants totalling SEK 35 million (30) were obtained and SEK 32 million (29) was recognized in the income statement. This mainly consisted of assistance received in Norway for carbon dioxide compensation and for energy ­efficiency measures.