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Financial Glossary

Here you find some expressions and definitions of figures and terminologies, which are used at Wienerberger.

Acquisition

Expenditure for the purchase of a company or share in a company

 

ADR

American Depository Receipt: deposit certificates that confirm ownership of a foreign stock and are traded on US stock exchanges or over-the-counter as shares; US banks buy stock and issue ADR’s in order to give foreign companies access to the US capital market

 

Asset coverage

Equity divided by non-current assets; indicates the percentage to which land, buildings, machinery etc. are covered by equity

 

ATX

Abbreviation for the “Austrian Traded Index” of the Vienna Stock Exchange

 

Bearer shares

Shares that are not issued to a specific person; the rights to these securities accrue to the person who holds them

 

CAGR

Compound Annual Growth Rate

 

Capital Employed (CE)

Equity plus interest-bearing debt (incl. net inter-company balance) less liquid funds and financial assets; the sum of capital engaged in a company

 

Capital Employed, historical

Capital employed at historical purchase prices; capital employed plus accumulated depreciation

 

CFROI

Cash Flow Return on Investment; ratio of EBITDA to average historical capital employed

 

Clay block

Brick made of burned clay, used for load-bearing exterior monolithic or cavity walls as well as for interior walls

 

Clay roof tile

Roof tiles made of burned clay in various shapes and colors

 

Common shares

Shares that carry full rights in a stock corporation (including participation in the Annual General Meetings, voting rights and dividend rights)

 

Corporate governance

Rules for the responsible management and control of companies that are set forth in the Austrian Corporate Governance Code

 

Covenant (financial)

A clause in a credit agreement that obliges the borrower not to exceed or fall below a specific indicator

 

Cross currency swap

Agreement between contract partners to exchange cash flows in two different currencies over a certain period of time; a hedge against foreign currency fluctuations

 

CVA

Cash Value Added; EBITDA - (average historical capital employed x hurdle rate)


 

Deferred taxes

The result of temporary differences in income recognition between tax law and the individual and consolidated financial statements prepared accounting to IFRS

 

Depreciation, economic

The value that must be earned each year in order to cover expenses for replacement investments at the end of an asset’s useful life

 

Depreciation ratio

Depreciation (excluding impairment charges to goodwill and assets) as a percentage of revenues

 

EBIT

Earnings before interest and taxes, or operating profit

 

EBIT, operating

EBIT adjusted for impairment charges to goodwill and assets as well as the reversal of impairment charges to assets

 

EBITDA

Earnings before interest, taxes, depreciation and amortization, or operating profit before depreciation and amortization = gross cash flow

 

EBITDA margin

EBITDA divided by revenues

 

Equity method

Valuation method used for the consolidation of investments between 20% and 50% in other companies

 

Equity ratio

Equity divided by total assets

 

EVA

Economic Value Added, or the difference between the return on capital employed and cost of capital; average capital employed x (ROCE - WACC)

 

Facing brick

Brick made of burned clay, used for external, non-load-bearing walls of buildings

 

Forward exchange contract

Foreign exchange transaction that is not realized at conclusion of the relevant contract, but at a later point in time; a hedge against exchange rate fluctuations

 

Free cash flow

Cash flow from operating activities less cash flow from investing activities plus growth capex; the amount of cash earned in the current year that is available for growth projects, dividends and the repayment of debt or share buy-backs

 

Free float company

Publicly traded corporation with a majority share of free float


  


 

GARP investor

Growth at a reasonable price; investor who aims to identify only those growth stocks that meet his/her criteria for buying at reasonable prices

 

Gearing

Debt indicator; net debt divided by equity including non-controlling interests; an indicator of financial security

 

Goodwill

Surplus of the price paid for a company over the net assets acquired 

 

Hedging

Measures used in the management of financial risk to limit or avoid negative market changes in the areas of interest rates, foreign currency, market values or raw materials

 

Hurdle rate

Return that must be earned to cover the cost of capital and economic depreciation; WACC before tax + economic depreciation (see above)

 

Hybrid capital

Subordinated perpetual corporate bond, which is ranked between equity and debt as mezzanine capital

 

IFRS

International Financial Reporting Standards

 

Interest cover

Operating EBIT divided by interest result; indicates the number of times operating income will cover interest result

 

Interest rate swap

Agreement to exchange cash flows with different terms over a specific period of time; these cash flows are based on fixed and variable interest rates; provides security against interest rate fluctuations

 

Investments

Additions to plant, property and equipment and intangible assets 
 

Joint venture

Agreement by two or more companies to jointly operate a business enterprise

 

LLLD (Long Length Large Diameter Pipes)

Pipes for industrial facilities with a diameter of up to 2.5 meters and a length of up to 600 meters

 

Long-term incentive (LTI) program

A long-term variable remuneration program for the Managing Board and key Group managers to synchronize management goals with shareholders’ interests 


 

Net debt

Net sum of financial liabilities - cash and cash at bank - securities and other financial assets - intercompany receivables and payables from financing

 

Net result

Profit after tax attributable to equity holders of the parent company

 

NF

Abbreviation for “Normalformat”, the standard size for clay blocks (250 x 120 x 65 mm)

 

NOPAT

Net operating profit after tax, or operating profit less taxes and adjusted taxes (tax effects from financial results)

 


 

Paver

Product made of clay or concrete, used in the design of gardens and public spaces

 

PE

Polyethylene, a synthetic material

 

PP

Polypropylene, a synthetic material

 

Preferred shares

Shares that are senior to common shares based on special rights conveyed by the articles of association

 

PVC

Polyvinyl chloride, a synthetic material

 

P/E ratio

Price/earnings ratio; an indicator for the market valuation of a stock

 

Rating

Standardized evaluation of the credit standing of a company, which indicates the probability of insolvency or delayed payments

 

Registered shares

Shares issued in the name of the shareholder; the owner is listed in the company’s share register

 

Return on equity

Profit after tax divided by equity, or the rate of return on shareholders’ investments

 

ROCE

Return on capital employed, or NOPAT divided by average capital employed = net yield on capital employed

 

Translation risk

Arises from the conversion of foreign currency items on the balance sheet; these foreign exchange fluctuations are not offset by balance sheet items in the same currency

 

Treasury

Staff function to safeguard the financing, cash management and financial risk management of a company

 

UGB

“Unternehmensgesetzbuch” (the Austrian Company Code)

WACC

Weighted average cost of capital, or the average price a company must pay on financial markets for equity and debt

 

WF

Abbreviation for “Waalformat”, the standard size for a facing brick (210 x 100 x 50 mm)

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