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To provide a better understanding of the group’s performance in the year ended 30 September 2020, in addition to conventional measures presented in accordance with IFRS, this report provides certain performance indicators to supplement – not replace – conventional measures.
The indicators occasionally used are detailed below.
PROFITABILITY INDICATORS
EBITDA (Earnings Before Interest, Taxes, Depreciation and Amortisation – from Continuing Operations). The group uses this ratio as a target for internal management control and in presentations to analysts and investors. It serves as a unit of measure to evaluate operating performance.
Profit for the year
+ Current and deferred taxes
+ Financial expense/(financial income)
+ Non-recurring expense/(non-recurring income)
+ Amortisation, depreciation and accruals
+ Impairment losses/(reversals of impairment losses)
Adjusted EBITDA is net of non-recurring or exceptional items. Generally, it is the indicator that is most representative of gross operating profit or loss.
EBIT (Earnings Before Interest and Taxes – from Continuing Operations) or Adjusted Gross Operating Profit.
Profit for the year
+ Current and deferred taxes
+ Financial expense/(financial income)
+ Non-recurring expense/(non-recurring income)
+ Impairment losses/(reversals of impairment losses)
Adjusted EBIT is net of non-recurring or exceptional items. Generally, it is the indicator that is most representative of operating profit or loss.
FINANCIAL INDICATORS
NET NON-CURRENT ASSETS. The difference between total non-current assets and other non-current liabilities under non-current liabilities.
NET CURRENT ASSETS. The difference between total current assets (net of financial assets) and total current liabilities (net of financial liabilities).
NET FINANCIAL DEBT (NET FINANCIAL POSITION)1
This indicator is used to indicate the group’s more general financial position.
The definition of net financial debt has been modified following the initial application of IFRS 16, which requires the recognition under financial liabilities of the lease liabilities recognised for right-of-use assets, in relation, inter alia, to operating leases (e.g., leases of operating facilities, car rental).
The following table compares the breakdown of this indicator before and after the application of the new standards:
| NFD (pre-IFRS 16) | NFD (post-IFRS 16) | ||
|---|---|---|---|
| + | Cash and cash equivalents (bank and postal accounts, cash and cash equivalents, cheques) | + | Cash and cash equivalents (bank and postal accounts, cash and cash equivalents, cheques) |
| + | Securities in portfolio or equivalents (NWC) | + | Securities in portfolio or equivalents (NWC) |
| + | Current financial assets | + | Current financial assets |
| - | Bonds or equivalent (mini-bonds) | - | Bonds or equivalent (mini-bonds) |
| - | Current and non-current bank loans and borrowings | - | Current and non-current bank loans and borrowings |
| - | Other bank loans and borrowings and/or other loans that generate financial expense | - | Other bank loans and borrowings and/or other loans that generate financial expense |
| - | Lease liabilities recognised using the financial method (IAS 17). | - | Non-current liabilities with lease companies for movable and immovable assets and/or companies with which a right-of-use asset can be identified for movable and/or immovable assets, recognised using the methodology provided for by IFRS 16. |
DEBT TO EQUITY RATIO NFD/EQUITY
This ratio, which shows the balance between borrowed and venture capital and the level of capitalisation, compares net financial debt to equity.
CURRENT RATIO. This is a liquidity ratio expressing the ratio of current assets to current liabilities.
ACID TEST RATIO. This ratio measures the group’s ability to repay current debt. It is the ratio of cash and cash equivalents plus current assets to current liabilities.
MIXED INDICATORS
DEBT TO ADJUSTED EBITDA RATIO NFD/Adj. EBITDA
The ratio, which is also frequently used the other way round, shows the group’s ability to repay its financial liabilities by using the adjusted gross operating profit.
See also the notes to the consolidated financial statements – Errore. L’origine riferimento non è stata trovata.. ↩