Value-oriented business management
Key performance indicators for planning and managing business operations are revenue, operating income before depreciation and amortisation (EBITDA) and capital expenditure. The enterprise value/EBITDA ratio also permits comparisons of Swisscom’s enterprise value derived from the share price on the balance sheet date with that of similar companies (European telecommunications companies) as well as with the prior year. The members of the Board of Directors and Group Executive Board are paid a portion of their remuneration in the form of Swisscom shares, which are blocked for a period of three years. They are also subject to a minimum shareholding requirement. Variable remuneration based on financial and non-financial targets, the partial settlement of remuneration in shares and the minimum shareholding requirement ensure that the financial interests of management are aligned with the interests of shareholders.
|In CHF million, except where indicated||31.12.2019||01.01.2019 1|
|Net debt incl. lease liabilities||8,785||8,631|
|Defined benefit obligations||1,058||1,196|
|Income tax assets and liabilities, net||607||873|
|Equity-accounted investees and other non-current financial assets||(339)||(217)|
|Enterprise value (EV)||36,667||34,799|
|Operating income before depreciation and amortisation (EBITDA)||4,358||4,420 2|
|Ratio enterprise value/EBITDA||8.4||7.9|
1 Incl. effect of the initial application of IFRS 16.
2 Excl. operating lease expense according to IAS 17.
Swisscom’s enterprise value increased by 5.4% or CHF 1.9 billion to CHF 36.7 billion in 2019. The main reason for this was the CHF 2.2 billion increase in market capitalisation. On a comparable basis, EBITDA declined, however. Nevertheless, the ratio of total enterprise value to EBITDA increased slightly to 8.4 (prior year: 7.9). Swisscom’s relative market valuation is therefore well above the average for comparable companies in Europe’s telecoms sector. The higher relative valuation is supported by Swisscom’s solid market position and attractive dividend. In addition, the lower interest rates and lower profit tax rates in Switzerland compared to other European countries have a positive effect.