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Debt financing

SSAB's funding is focused on supporting the Group’s strategy and covering the needs for financing within the framework of the Group's financial policy. The funding is primarily executed through the parent company. In order to minimize the refinancing risk, the objective is that the debt should have an even maturity profile. Short-term funding is primarily obtained through the commercial paper markets in Sweden and Finland. SSAB has a strong and supportive bank group providing committed back-stop facilities to secure the short-term funding and liquidity needs.  In order to secure access to competitively priced funding in the relevant markets, SSAB strives to be transparent and informative toward the investor community.



 

Key figures     Q3/017  2016 2015 2014 2013
Net debt SEK million  13,994 17,887
23,156
24,674 14,833
Net debt/equity ratio %  27  34 52 56 55
Average term on the loan portfolio years  4.9  5.1 4.6 3.9 4.1
Averaged fixed interest term years  1.1  0.8 1.1
1.2 0.9
Non-utilized credit facilities SEK million  7,747  7,096 8,308
8,714 7,319
Cash and cash equivalents SEK million  4,865  3,879 2,711
3,014 2,124

 

Cash flow, financing and liquidity (from Q3/2017 report)

Operating cash flow for the first three quarters of 2017 was 3,535 (2,154) million. Cash flow was positively impacted primarily by operating profit.
 
Net cash flow was SEK 2,467 (5,938) million. Net cash flow was affected, among other things, by payments for strategic expenditures, including acquisitions of operations and businesses of SEK 163 (236) million. Total capital expenditure was SEK 966 (924) million. During 2016, cash flow was impacted by proceeds of SEK 4,911 million from the rights issue. Net debt decreased by SEK 3,893 million during the first three quarters and at September 30, 2017 amounted to SEK 13,994 million. The net debt/equity ratio was 27% (35%).
 
The term to maturity of the total loan portfolio at September 30 averaged 4.9 (5.2) years, with an average fixed interest period of 1.1 (0.9) years.
 
Cash and cash equivalents were SEK 4,865 (3,801) million and non-utilized credit facilities were SEK 7,747 (7,493) million, which combined corresponds to 20% (21%) of rolling 12 months’ sales. 

 

Debt structure on (at September 30, 2017)

 

 

Net debt and net debt/equity ratio (at September 30, 2017)

 

 

Debt maturity (at September 30, 2017)

 

 

Debt cost and duration

 

 

Debt programs

SSAB’s funding is conducted primarily through the bank market and existing note and commercial paper programs. For borrowing for terms of up to ten years, a European Medium Term Note program (EMTN) is used, while Swedish and Finnish commercial paper programs are used for borrowing for shorter terms. The program limit of the EMTN program is EUR 2,000 million. The Swedish commercial paper program has a limit of SEK 5,000 million and the Finnish commercial paper program has a limit of EUR 500 million.

Main financial
arrangements 
Total
amount
European medium
Term Note
program (EMTN)
EUR 2,000
million
Swedish commercial
paper program
SEK 5,000
million
Finnish commercial
paper program
EUR 500
million

Related documents

EMTN Prospectus 2017

EMTN Prospectus 2016

EMTN Prospectus 2015

EMTN Prospectus 2014

Prospectus Amendment

Swedish Commercial Paper Program


Credit ratings

Credit ratings are important for the Group to be able to secure competitively priced funding. The company aims at having at least one rating.
On Oct. 31, 2017, S&P Global Ratings raised its long-term corporate credit rating on SSAB to 'BB-' from 'B+'.
At the same time, S&P affirmed the 'B' short-term corporate credit rating. The outlook is stable.

Standard & Poors' Ratings Direct, Research update 2017-10-31

Standard & Poors' Ratings Direct, Research update 2017-03-22

Standard & Poors' Ratings Direct, Research update 2016-06-08

Standard & Poors's Ratings Direct, Research Update 2016-02-22

Standard & Poors's RatingsDirect, Research Update 2015-12-21

Standard & Poor's RatingsDirect, Research Update 2015-05-29

Standard & Poor's RatingsDirect, Bulletin 2014-01-22

Standard & Poor's RatingsDirect, Research Update 2013-11-12