Targets and target fulfillment
Sandvik has long-term financial targets focusing on growth, profitability, dividend and financial position. The 2030 sustainability targets focus on the areas of circularity, climate, people and fair play.
Financial Targets
Growth1)
Target
≥5%
A growth of ≥5 percent through a business cycle, organically and through acquisitions.
Outcome
5%
The revenue growth 2016–2021 was 5 percent. In 2021 the organic growth was 12 percent, and total growth, at fixed exchange rates, was 18 percent.
Trough EBIT margin
Target
≥16.0%
A trough EBIT margin of ≥16 percent rolling 12 months, adjusted for items affecting comparability and metal prices.
Outcome
18.3%
The EBIT margin, adjusted for items affecting comparability and metal prices, amounted to 18.3 percent in 2021. The EBITA margin amounted to 19.1 percent.
Dividend payout ratio1)
Target
50%
A dividend payout ratio of 50 percent of earnings per share, adjusted for items affecting comparability, through a business cycle.
Outcome
44%
The average payout ratio in 2016–2021 amounted to 44 percent. A solid performance in 2021 resulted in a proposed dividend of SEK 6 billion (8), corresponding to a payout ratio of 42 percent.
Net debt/equity ratio
Target
<0.5
A net debt/equity ratio below 0.5.
Outcome
0.35
The target was achieved as the net debt to equity ratio was 0.35.
1) The growth and dividend payout ratio targets refer to average through a business cycle, defined as 2016–2021.
Sustainability Goals
We have 2030 Sustainability Goals in four areas and we report on KPIs for our own operations to track progress towards targets. In addition to our own operations, we also work with customers and suppliers to achieve the goals.
We build circularity
Target
280 ktons
Our target is to reduce our waste by 50 percent by 2030. To be in line with this target we should reduce waste to 280 ktons by 2021.
Outcome
352 ktons
Our waste amounted to 352 ktons, an 8 percent increase compared to 2020. The increase was attributed to major waste haulages and increased activity levels. This target was revised in 2021 to better reflect our efforts towards circularity and we will report on the new target as of 2022.
We shift climate
Target
311 ktons
Our target is to reduce our CO2 emissions by 50 percent by 2030. To be in line with this target we should reduce CO2 emissions to 311 ktons by 2021.
Outcome
234 ktons
In 2021, we reduced our CO2 emissions by 16.4 percent to 234 ktons, despite increased production and traveling. Fossil-free energy sourcing was the major contributor.
We champion people
Target
4.0
Our target is to reduce our Total Recordable Injury Frequency Rate (TRIFR) to 2.3 by 2030, a 50 percent reduction. To be in line with this target we should reduce the TRIFR to 4.0 by 2021.
Outcome
3.5
The TRIFR was 3.5 (3.2), a 9 percent increase but still in line with our 2030 target. Injury rates decreased at the end of the year after a negative trend in the first three quarters. The increase is mainly attributable to a higher number of less severe injuries which accounted for 79 percent of the total increase of incidents.
We play fair
Target
19.5%
Our target is to increase the share of women in managerial positions to one third by 2030. Our target was to have 19.5 percent female managers by 2021.
Outcome
19.8%
The share of female managers rose to a new top level of 19.8 percent, a 7.3 percent increase. It verifies our plan in place to accelerate the increase of female managers in the years to come, which is necessary to achieve the 2030 goal.
The baseline for our Sustainability Goals is the average outcome from 2016–2018. The dotted line is an indication of how well-aligned we are with the 2030 targets. TRIFR and CO2 emissions are ahead the required results while waste and female managers are behind, in relation to the 2030 slope.