Tuesday, December 29, 2015
Södra’s Board of Directors has adopted a new profit-sharing policy, which means that the total profit distribution to shareholders increased from 40 to 50 percent over a business cycle. At the same time increased effort as possible emissions from 30 to 35 percent, while the requirement for the equity ratio increased from 50 to 55 percent.
With an increased profit sharing strengthens the profitability of forest are at the same time as they secure long-term financing for industry members, said Lena Ek, president of Southern.
Södra’s general meeting in May 2015 dealt with several motions on the principles of profit and Södra’s long-term financing. Subsequently, a special working group had the task of comprehensively illustrate the different perspectives on the future profits over a longer period of time. The Board endorsed the working group’s proposal involving a higher profit while access to good financing for the Group secured. It is good for the South, Sodra see that 2015 will be a strong year. At the same time seem to South in a global industry that is highly cyclical. The Board of Directors makes the assessment that Södra has a strong financial position that we meet both our long-term investment needs and at the same time can increase the profit sharing to its members, said Lena Ek, Chairman.
The current policy has said that the total profit-sharing, ie the dividend in the form of interest on capital contribution and after the settlement and contribution issues together is at least 40 percent of profit before tax over a business cycle. This ambition is now being raised to 50 percent. It also means that the dividend will reward both the year’s wood delivery as venture capital, in the form of contributions, which the member contributes. This part of the policy is supplemented with it sought a smoothness in the overall individual value transfer between individual years. Södra’s strong balance sheet will allow the space to make further contribution issues raised. Today, there is scope to make further contribution issues as long as the total contributed capital not exceeding 30 percent of total equity. This is now raised to 35 percent. Vivid decisions on profit sharing are the current requirement of a minimum equity ratio of 50 percent. This is now raised to 55 percent in order to both increase the individual ownership while ensuring a stable development of industries. Södra’s ownership form affects the ability to raise capital. To care and take responsibility for the balance sheet and therefore safeguard Södra’s independence therefore remains a top priority, hence we are raising our equity ratio target, said Lena Ek.
Southern presents its year-end report 2015 17 February 2016. The Board will propose to the general meeting in May to profit sharing under the new policy. Södra’s economic model of the South is a cooperative owned by its approximately 50,000 members. To become a member requires ownership of at least five hectares of forest land in Södra’s membership area (mainly Götaland) and member participation, from up capital of at least one bet for each hectare of forest land, but do not participate with more than 200 interventions. An operation reads of 600 crowns. Each year the member receives dividends on contributed capital in the form of interest, and for 2014 it amounted to 6 percent. Södra’s members are rewarded for how much timber supplied, so called after the settlement. For 2014, this amounted to 8 per cent on wood deliveries. Members’ contribution account can be increased through the participation issue.
Tags: 40 to 50 percent, profit share, shareholders, Södra
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