UPM.COM

Financial targets

UPM is aiming higher in its financial performance

Top performance drives value creation and mitigates risk related to the business environment. Is also enables investments in growth, innovation and responsibility.

  • ​Business areas target attractive long-term returns (ROCE %), which apply over investment and business cycles and enables value-creating growth investments.
  • At the group level, UPM is targeting comparable EBIT growth.

  • UPM aims to maintain a strong balance sheet. UPM’s financial policy on leverage is based on net debt/EBITDA ratio approximately 2 or less.

  • UPM aims for a 10% return on equity. ROE also takes into account the financing, taxation and capital structure of the group.

  • UPM aims to pay an attractive dividend: 30-40% of the company's annual operating cash flow per share.

 

Business area targets

 

Business area long-term return targets

Business Area Measure Target (%) Actual 2018(%) Actual 2017 (%) Actual 2016 (%)
​UPM Biorefining ​​ROCE % ​14 26.6 ​18.2 ​12.6
​UPM Energy ​​​​​ROCE %** ​6 5.3 ​4.0 ​5.0
​UPM Raflatac ​​​​ROCE % ​20 23.6 ​27.2 ​25.5
​UPM Specialty Papers ​​​​ROCE %* ​14 10.1 ​17.2 ​12.1
​UPM Communication Papers ​FCF/CE%* ​14 15.3 ​24.3 ​31.0
​UPM Plywood ​​​​ROCE % ​18 18.4 ​23.1 ​22.6

ROCE % = Return of capital employed excluding items affecting comparability.
* Free cash flow after investing activities (investments and/or divestments) and restructuring costs.
**UPM Energy assets valued at fair value. ​​

Business area targets compared with realised returns

 
 

Group targets

 

Comparable EBIT growth as a group-level target

Measure ​Target Actual 2018 (EURm) Actual 2017 (EURm) ​Actual 2016 (EURm)
​Comparable EBIT ​Growth​ 1,513 ​1,292 ​1,143
 

Comparable ROE target

Measure ​Target (%) Actual 2018(%) Actual 2017 (%) ​Actual 2016 (%)
Comprable ROE % ​10.0 12.9 ​11.9 ​10.9
 

A financial policy on leverage based on net debt/EBITDA

Measure ​Policy Actual 2018 Actual 2017 ​Actual 2016
Net debt/EBITDA ​approx. 2x or less -0.17 ​0.11 ​0.73x
​Gearing ​N/A -3% ​2% ​14%
 

Group financial performance

 

Comparable-EBIT_ROE_Net_debt_18_ENG.png

 

Investor Relations: +358 (0)204 15 0033, ir@upm.com