Page 95 - KELAG Annual Report 2017

Non-current financial liabilities 424.0 436.6
Current financial liabilities 4.7 5.7
Pension provisions 127.1 124.8
Provisions for severance payments 73.9 77.9
Provision for long-service awards 13.8 15.1
Provisions for “Altersteilzeit” (German phased retirement scheme) 34.6 34.2
SUBTOTAL 678.1 694.2
less cash and cash equivalents -160.8 -167.5
less securities -25.2 -25.8
NET LIABILITIES 492.0 500.8
Equity 855.5 817.2
NET GEARING 57.5% 61.3%

Further objectives of capital management include retaining a high credit rating, which is also
firmly entrenched as a component of the corporate strategy, ensuring an adequate return on
equity and a consistent dividend policy.

No changes were made to the capital management objectives, policies or processes as of
31 December 2017.

Entrepreneurial activity means that opportunity is not without risk. Consequently, the willingness
to take and limit risks has to be defined. To this end, KELAG operates a risk management system
that addresses risks from its own activities as well as risks from its market environment. The group-
wide rules and minimum standards ensure a systematic and uniform risk management system. It
is the KELAG Group’s strategic goal to raise risk awareness at all levels, to systematically consider
risk aspects in all business decisions, to improve performance of internal control systems and
reporting as well as to establish a value-oriented risk culture at all levels of the Group, beyond the
scope of the requirements set by the legal minimum standards.

The focus of group-wide risk management relates to the risk categories identified for the KELAG
Group: market and competition risks, credit risks, operational risks, financial risks, systemic risks