Report 2017

Equity and shareholder return

Shareholders' equity

At December 31, 2017, shareholders’ equity was DKK 11,267 million, down 4% from DKK 11,745 million at December 31, 2016, as dividend payments and stock buyback in 2017 more than offset comprehensive income. 


Equity ratio 

Shareholders’ equity represented 61% of the balance sheet total, down from 63% at December 31, 2016. 


Return on equity

Return on equityA profitability ratio that measures a company’s ability to generate profits from its shareholders’ investments in the company. was 27.1%, up 1.0 percentage point from 26.1% in 2016. The increase was a result of higher net profit and a decrease in equity.

 

Treasury stock 

At December 31, 2017, the holding of treasury stock was 12.1 million B shares, equivalent to 4.0% of the common stock. 


Dividend

The Board of Directors proposes that the Annual Shareholders' Meeting approve a dividend of DKK 4.50 per share for the 2017 financial year, an increase of 13% compared with 2016. This will result in an expected total dividend payment of approximately DKK 1,318 million, corresponding to a payout ratio of 42.3%.  


Stock buyback program

In 2017, Novozymes bought back 6.8 million B shares with a transaction value of DKK 2,000 million under the stock buyback program initiated on January 25, 2017, and completed on November 9, 2017. The shares acquired within the program will be used to reduce the common stock and to meet obligations arising from employee share-based incentive programs. 

 

Attributable to shareholders in the company
DKK million Common stock Currency translation adjustments Cash flow
hedges
Retained
earnings
Total Non-controlling interests Total equity
Shareholders' equity at January 1, 2017 620 670 (41) 10,483 11,732 13 11,745
Net profitĀ for the year 3,119 3,119 1 3,120
Other comprehensive income for the year (932) 86 (846) (1) (847)
Total comprehensive income for the year (932) 86 3,119 2,273 - 2,273
Purchase of treasury stock (2,000) (2,000) (2,000)
Sale of treasury stock 179 179 179
Write-down of common stock (10) 10 - -
Dividend (1,192) (1,192) (1,192)
Stock-based payment 104 104 104
Tax related to equity items 158 158 158
Changes in shareholders' equity (10) (932) 86 378 (478) - (478)
Shareholders' equity at December 31, 2017

B/S

610 (262) 45 10,861 11,254 13 11,267
Shareholders' equity at January 1, 2016 626 538 20 10,396 11,580 13 11,593
Net profitĀ for the year 3,050 3,050 - 3,050
Other comprehensive income for the year 132 (61) 71 71
Total comprehensive income for the year 132 (61) 3,050 3,121 - 3,121
Purchase of treasury stock (2,000) (2,000) (2,000)
Sale of treasury stock 69 69 69
Write-down of common stock (6) 6 - -
Dividend (1,061) (1,061) (1,061)
Stock-based payment 136 136 136
Tax related to equity items (113) (113) (113)
Changes in shareholders' equity (6) 132 (61) 87 152 - 152
Shareholders' equity at December 31, 2016

B/S

620 670 (41) 10,483 11,732 13 11,745
The proposed dividend of DKK 1,318 million for 2017 is included in Retained earnings.
Movements in equity 2017
DKK million
Created with Highcharts 5.0.0 Equity, Jan. 1, 2017 Comprehensive income Stock buyback Dividend Other Equity, Dec. 31, 2017 10,000 12,500 15,000 17,500
    Payout ratio and dividend growth
    %
    Created with Highcharts 5.0.0 2013 2014 2015 2016 2017 0 20 40 60
    • Payout ratio
    • Dividend growth
    Shareholder return
    DKK million * Dividend for 2017 is proposed dividend.
    Created with Highcharts 5.0.0 788 2,925 3,061 3,192 3,318 2013 2014 2015 2016 2017 0 1,000 2,000 3,000 4,000
    • Stock buyback program
    • Dividend