Financing activity

The Group’s investments were funded from the cash flow from operating activities. New debt capital issuances were mainly conducted for refinancing and general corporate purposes. In the year under review, capital market issuances of CHF 700 million were undertaken by the Group, enabling the Group to lock in historically low interest rates. The main capital market transactions were as follows:

AUD 250 million

Holcim Finance (Australia) Pty Ltd bond with a coupon of 3.75%, term 2015–2020

MXN 1,700 million

Holcim Capital México S.A. de C.V. bond with a floating interest rate, term 2015–2020

CHF 250 million

LafargeHolcim Ltd bond with a coupon of 0.375%, term 2015-2021

CHF 150 million

LafargeHolcim Ltd bond with a coupon of 1.00%, term 2015–2025

The Group early repaid several outstanding bonds in the second half of the year to reduce debt with the proceeds from the merger-related divestments. In the third quarter 2015, the Group repurchased a total nominal amount of CHF 2,460 million of outstanding EUR and GBP bonds. In the fourth quarter of 2015, bonds denominated in USD and CAD with an aggregated nominal amount of CHF 518 million were repurchased.

Net financial debt

The Group’s financial structure remained solid and net financial debt amounted to CHF 17,266 million at December 31, 2015.

Capital market financing of the Group as per December 31, 2015 (CHF 15,977 million, excluding PPA)

 

 

excl. PPA

Category

Category (details)

Million CHF

in %

EUR Bonds

 

5,156

32%

USD Bonds

 

3,697

23%

CHF Bonds

 

2,873

18%

EUR CPs

EUR Commercial Paper

1,145

7%

GBP Bonds

 

938

6%

EUR PPs

EUR Private Placements

675

4%

AUD Bonds

 

505

3%

USD PPs

USD Private Placements

371

2%

MXN Bonds

 

352

2%

USD CPs

USD Commercial Paper

113

1%

USD IRBs

USD Industrial Revenue Bonds

84

1%

Other

 

67

0%

INR PP

INR Private Placement

52

0%

CRC Bond

 

15

0%

Total

 

15,977

100%

Financing profile

The Group has a strong financial profile. 77 percent of the financial liabilities are financed through various capital markets and 23 percent through banks and other lenders. There are no major positions with individual lenders. The average maturity of financial liabilities decreased to 4.2 years based on the new debt portfolio resulting from the merger. The Group’s maturity profile is widely spread with a large proportion of mid to long-term financing.

Maintaining a favorable credit rating is one of the Group’s objectives and the Group therefore gives priority to achieving its financial targets and retaining its investment-grade rating (current rating information is displayed under Capital market information). The average nominal interest rate on Group’s financial liabilities as of December 31, 2015, was 5.1 percent, whereas the proportion of financial liabilities at fixed rates was at 50 percent. Detailed information on financial liabilities can be found in the respective Note 25.

Maturity profile as of December 31, 20151 Million CHF
Maturity profile as of December 31, 2015 (bar chart)Maturity profile as of December 31, 2015 (bar chart)

1 After risk-related reclassification of commercial papers in the amount of CHF 1,258 million from ST to LT financial liabilities due to committed back-up credit line. The amount of CHF 745 million related to the purchase price allocation (PPA) on debt is excluded in the maturity profile as it will be amortized over time.