For reasons of sustainability, we generally follow a conservative financial policy. Apart from a solid balance sheet with transparent and healthy structures, this policy is reflected by the selection of financing sources, liquidity management, key financial indicators, the dividend policy, and risk management. We generate high business free cash flow and its return on capital employed has been sustainably maintained at a high level.
In the context of the ongoing Group-wide efficiency program, in the past years cash was reserved with high priority to fund restructuring measures across all divisions and regions. In 2014, liquid funds were then used in particular for the acquisition of AZ Electronic Materials (Performance Materials).
One-time expenses in connection with restructuring measures as well as costs related to the integration of acquired businesses have also been assumed for 2015. With the acquisition of Sigma-Aldrich (Life Science) in 2015 liquid funds were again used for inorganic growth. Accordingly, in the coming years, the repayment of the financial liabilities taken up in connection with this acquisition will be at the fore, along with the associated ongoing interest payments. In this case, initial one-time expenses for the integration could already be incurred then. However, smaller, so-called bolt-on acquisitions are still not ruled out. In addition, we will also invest in organic growth initiatives as part of its “Fit for 2018” transformation and growth program.
Merck KGaA, Darmstadt, Germany, is pursuing a sustainable dividend policy. Provided that the economic environment develops in a stable manner, the current dividend represents the minimum level for future dividend proposals. The dividend policy follows the business development and earnings increase of the coming years. However, dividend growth could deviate, e.g. within the scope of restructuring or in the event of significant global economic developments. We also aim for a target corridor of 20 – 25 % of EPS pre one-time items.