Financial Targets
| Target | 2023 | 2022 | |
|---|---|---|---|
| Leverage factor: Economic debt/Operating EBITDA adjusted1) | ≤ 2.5 | 1.8 | 1.8 |
| Coverage ratio: Operating EBITDA adjusted/financial result1) | > 4.0 | 8.3 | 11.1 |
| Equity ratio: Equity to total assets (in percent) | ≥ 25.0 | 46.5 | 45.8 |
1) After modifications. |
Bertelsmann utilizes a financial management system employing quantitative financial targets concerning the Group’s economic debt and, to a lesser extent, its capital structure. One of the financial targets is a dynamic leverage factor calculated as the ratio of economic debt to operating EBITDA adjusted; this factor should not regularly exceed the defined maximum of 2.5. As of December 31, 2023, the leverage factor was 1.8 and at the level of the previous year (December 31, 2022: 1.8).
As of December 31, 2023, economic debt amounted to €4,713 million compared to €4,785 million in the previous year. At €2,267 million, net financial debt also remained nearly at the level of the previous year (December 31, 2022: €2,249 million). As of December 31, 2023, recognized lease liabilities fell to €1,333 million (December 31, 2022: €1,538 million). At €700 million as of December 31, 2023, provisions for pensions and similar obligations were at the level of the previous year (December 31, 2022: €710 million). Most of the short-term liquidable investments in a special fund set up in 2021 were liquidated in the reporting period. On December 31, 2022, these were deducted from the economic debt for the final time in the amount of €125 million.
Another financial target is the (interest) coverage ratio. This is calculated as the ratio of operating EBITDA adjusted, used to determine the leverage factor, to financial result, and should exceed four. In the reporting period, the coverage ratio was 8.3 (previous year: 11.1). The Group’s equity ratio rose to 46.5 percent (December 31, 2022: 45.8 percent), remaining significantly above the self-imposed minimum of 25 percent.
