Debt Factor

Calculation and Development

To manage E.ON's capital structure we use a steering metric called debt factor. The debt factor is defined as economic net debt divided by EBITDA1).

The debt factor is calculated as follows:
EUR in millions Dec 31, 2016 Dec 31, 2015
Liquid funds
8,573 8,190
Non-current securities 4,327  4,724
Financial liabilities -14,227 -17,742
FX hedging adjustment 390     218
Net financial position -937  -4,610
Provisions for pensions -4,009 -4,210
Asset-retirement obligations
21,374 2)
18,894
Economic net debt -26,320   -27,714
Adjusted EBITDA
4,9361)
7,557 3)
Debt Factors 5.3             3.7 3)
1) adjusted for non-operating effects
2)
 his figure is not the same as the asset-retirement obligations shown in our Consolidated Balance Sheet (€22,515 million). This is because we calculate our economic net debt in part based on the actual amount of our obligations
3)
not adjusted for Uniper; figure as reported in the 2015 Annual Report 

In addition to liquid funds also our non-current securities are taken into account when calculating economic net debt, as these are liquid investments predominantly used to fund our provisions.

The net financial position includes effects from foreign-currency hedging of financial transactions, which is analogous to the hedged underlying transaction.

Other items that are debt-like are also considered. These are mainly provisions for pensions and asset retirement obligations (less pre-payments).

The interest-rate environment at the balance-sheet date led in some cases to negative real interest rates on asset-retirement obligations. As a result, these provisions exceed the actual amount of the obligations as they stood at year-end 2016 excluding the effects of discounting and cost increases. This limits the relevance of our economic net debt as a key figure. E.ON wants economic net debt to continue to serve as a useful key figure that aptly depicts the debt situation. In the case of material provisions affected by negative real interest rates, E.ON henceforth uses the aforementioned actual amount of the obligation instead of the balance-sheet figure to calculate economic net debt.

Development of Debt Factors

Information on our finacial strategy and more. 

Calculation and Development of the Debt Factor


 

Overview of all public bonds issued or guaranteed by E.ON SE



E.ON announces to offer an exchangeable Bond based on shares of BKW AG.

 

E.ON International Finance B.V. is our Dutch finance entity. 

Helpful Answers for Retail Investors

 

More on our Commercial Paper Program
 

Program for the issuance of debt instruments.
 

Rating by Moody's and Standard & Poor's

 

Presentations giving an overview on E.ON's funding program and finance strategy.

Creditor Relations
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