Sandvik provides an update on changes in the reporting
Sandvik announced significant accounting and reporting changes effective in 2022. The company will classify Sandvik Materials Technology (SMT) as discontinued operations, with a proposal for its distribution and listing to be made at the Annual General Meeting on April 27, 2022. Furthermore, Sandvik is shifting its key operating profit metric to adjusted EBITA, replacing the previous adjusted EBIT. Additionally, M&A transaction costs will now be reported as items affecting comparability. These updates aim to enhance clarity on Sandvik's underlying operating performance.
- Introduction of adjusted EBITA as a clearer performance measure.
- Enhanced clarity on operating performance following the changes.
- Classification of SMT as discontinued operations may indicate a strategic shift or possible divestiture.
- Potential complexity in financial reporting due to the introduction of new metrics.
SANDVIKEN, Sweden, March 23, 2022 /PRNewswire/ --
Sandvik will make the following accounting and reporting changes as of 2022:
Treatment of Sandvik Materials Technology in financial statements:
Today, Sandvik announced that the Sandvik Board of Directors has decided to propose the distribution and listing of Sandvik Materials Technology (SMT) to the Annual General Meeting, which takes place on April 27, 2022. As a consequence, Sandvik will from the first quarter 2022 report SMT as discontinued operations and as assets and liabilities held for distribution in accordance with IFRS 5.
Adjusted EBITA and currency definition:
In line with our shift to growth strategy, Sandvik has accelerated the pace of acquisitions. To enhance clarity on the underlying operating performance of the Group, Sandvik introduced adjusted EBITA as an alternative performance measure in the third quarter interim report 2021. As of 2022, the adjusted EBITA will replace adjusted EBIT as the key operating profit metric. Furthermore, M&A transaction costs will from 2022 be reported as items affecting comparability (IAC).
In addition, Sandvik will as of the first quarter 2022 report the effects arising from revaluations of financial balance sheet items and hedges as organic effects, which previously were accounted for as currency effects.
Stockholm, March 23, 2022
Sandvik AB
For further information, contact Louise Tjeder, VP Investor relations, phone: +46 (0) 70782 6374 or Johannes Hellström, Press and Media Relations Manager, phone: +46 (0) 70721 1008.
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SOURCE Sandvik
FAQ
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