Return on investments
The return on capital employed totalled 15% (10). The average per annum return during the period from 2012 to 2016 has been 10%. Any investments made shall demonstrate a high return and shall be made in line with both Boliden’s strategy and available resources. The projects’ internal interest rates shall be higher than Boliden’s weighted average cost of capital (WACC), adjusted for a risk premium.
The WACC before tax is currently nominally set at 12%, which corresponds to 10% in real terms. Calculations for major and long-term projects are normally conducted in real terms. They are based on forecast interest rates, metal prices, exchange rates, inflation and other relevant assumptions drawn from internal analyses and external assessments.
Net debt/equity ratio
The net debt/equity ratio at the end of 2016 was 32% (23). The increase from 2015 is due
to the acquisition of Kevitsa.
The net debt/equity ratio in an economic upturn shall be no higher than 20 per cent. The aim is to maintain a reasonable financial ability to act in a recession.
The proposed dividend is SEK 5.25 per share (3.25), corresponding to 33.9% (33.7) of the net profit for the year. The dividend share during the period from 2012 to 2016 was 33.8% of the aggregate net profit for the period.
Boliden’s dividend policy states that the dividend shall correspond to approximately one third of the net profit.