Alternative performance measures
In addition to those prescribed by IFRS, Implenia uses alternative measures to help it manage its business. The following overview explains the alternative performance measures (APMs) used in this report. The aim is to clarify the reasons for using these measures and to improve transparency and comprehensibility.
Definitions of alternative performance measures | ||
APM | Definition | |
Order book | The order book is defined as services that have been contractually agreed but not yet performed, valued by contract amount on the balance sheet date. Approved contractual changes are also included in the book. The order book increases when orders are secured, and decreases by the level of production output during the period. This measure helps predict the future development of Implenia’s construction activities. | |
Equity ratio | The equity ratio is the ratio of equity to total assets on the balance sheet date. The reported equity ratio takes account of the subordinated convertible bond. Our equity ratio reflects Implenia Group’s financing situation. | |
Free cash flow | Free cash flow is defined as cash flow from operating activities minus the acquisition and sale of fixed assets (excl. movements in fixed deposits). The free cash flow figure reflects our ability to generate cash, repay liabilities, make acquisitions and pay dividends. | |
Like-for-like | Implenia shows like-for-like figures (currency-adjusted) in order to measure changes since the previous reporting period without the distorting effect of exchange rate fluctuations. The adjustment is made by recalculating balance sheet items at the closing exchange rate on the last day of the previous year. Meanwhile, figures for the consolidated companies’ income, expenditure and cash flows are recalculated at the average exchange rates for the previous period converted into CHF. These like-for-like figures allow an assessment of Implenia’s performance over time without the influence of exchange rate effects. | |
Net cash position | The net cash position corresponds to the difference between cash and cash equivalents on the one hand, and interest-bearing short and long-term financial liabilities on the other. The net cash position reflects our ability to settle interest-bearing financial liabilities. | |
APM | Definition | |
Operating performance | Operating performance at EBIT level is a measure of Implenia’s operating performance excluding the impact of one-off effects, such as special transactions, restructuring provisions and other non-recurring effects. | |
Performance measures | Performance measures excl. IFRS 16 adjust for the impact of the IFRS 16 leasing standard. Performance reports made to the Implenia Executive Committee and Board of Directors contain figures that exclude the impact of IFRS 16. | |
Production output | Production output is calculated as IFRS revenue plus the proportionate revenue from joint ventures (JVs) valued using the equity method. Production output is a purely statistical measure that reflects the work actually done by the Group for its clients. | |
Return on invested capital | This measure is defined as the ratio between EBIT and average capital invested, excl. rights of use from leasing, during the period under review. It is a measure of profitability and capital efficiency. | |
Visibility | Visibility is calculated as the order book for the current year divided by planned production output for the next reporting period. Visibility is an indicator of future assured capacity utilisation. |
Reconciliations
The following reconciliation shows the derivation of the alternative performance measures “production output”, “EBIT” and “operating performance at EBIT level”:
in TCHF | APM | 1.1.‑31.12.2022 | 1.1.‑31.12.2021 | |||
Production output | X | 4,152,567 | 4,174,113 | |||
Proportional revenue and services invoiced to JVs | (589,301) | (409,443) | ||||
Consolidated revenue | 3,563,266 | 3,764,670 | ||||
EBIT | 138,861 | 114,826 | ||||
Other expenses from leases | (6,193) | (975) | ||||
EBIT excl. IFRS 16 | X | 132,668 | 113,851 | |||
EBIT | 138,861 | 114,826 | ||||
Disposals (share / asset deals) | (4,052) | (21,497) | ||||
Restructuring | (2,083) | (14,906) | ||||
Other effects | 2,244 | (1,897) | ||||
Underlying performance at EBIT level | X | 134,970 | 76,526 |
1 Production output in unconsolidated amount, disclosed as consolidated value in the previous year
The following reconciliation shows the derivation of the alternative performance measure “net cash position”:
in TCHF | APM | 31.12.2022 | 31.12.2021 | |||
Cash and cash equivalents and fixed short-term deposits | 609,040 | 796,895 | ||||
Financial liabilities | (654,479) | (888,453) | ||||
Net cash position | X | (45,439) | (91,558) | |||
Lease liabilities | 165,775 | 158,877 | ||||
Net cash position excl. lease liabilities | X | 120,336 | 67,319 |
Implenia defines free cash flow as cash flow from operating activities minus the acquisition and sale of fixed assets. The following table gives an overview of free cash flow:
in TCHF | APM | 1.1.‑31.12.2022 | 1.1.‑31.12.2021 | |||
Cash flow from operating activities | 128,126 | (69,246) | ||||
Investments in non-current assets | (42,838) | (49,400) | ||||
Disposal of non-current assets | 24,392 | 54,062 | ||||
Acquisition of subsidiaries | ‑ | 6,657 | ||||
Sale of subsidiaries | 14,317 | 40,433 | ||||
Free cash flow | X | 123,997 | (17,494) | |||
Impact of IFRS 16 Leases | (54,552) | (52,590) | ||||
Free cash flow excl. IFRS 16 | X | 69,445 | (70,084) |