Page 34 - KELAG Annual Report 2019

well as quick, reliable access to cash based on contractually
agreed facilities. Since the end of 2019, KELAG has had a
contractually agreed credit facility of EUR 250m until 2024
which is linked to the KELAG sustainability rating. EcoVadis,
one of the leading ESG (Environmental, Social, Governance)
ratings providers, evaluated and rated KELAG in this
context. The costs are based on KELAG’s sustainability
rating and may be reduced if the rating improves. In
addition to the very successful KELAG bonds issued in 2012
and 2014, KELAG has a loan with a volume of EUR 90m from
Again in the financial year 2019, the generally risk-averse
the European Investment Bank (EIB).
focus of the financial strategy remained on the two main
pillars: securing liquidity and strengthening the Group’s
credit standing. In this context, the current financial
strategy is a system of rules that is embraced by employees
and is embedded in the overarching corporate strategy. The
aim is to maintain the Group’s good credit rating in a
difficult business environment, even as the economy
The Group acts externally as a financial entity, thereby
becomes more dynamic and thus volatile. Safeguarding an
strengthening and optimising its negotiating position vis-
adequate liquidity reserve and maintaining a good credit
à-vis investors, banks and other business partners.
rating are still the primary objectives that guarantee KELAG
Moreover, all short-, medium- and long-term financing
the highest level of flexibility possible and unrestricted
measures are carried out at KELAG, which also acts as a
access to the financial markets. In addition, one of the key
pooling centre.
tasks is to centrally manage the balanced financing of
group entities in line with their requirements. When
selecting financing structures, the Group aims to diversify
its sources of finance and thereby safeguard existing bank
credit lines.

The cost of borrowing and the unrestricted access to
financial instruments hinge on a company’s credit rating.
Because risk premiums are determined based on rating
categories, maintaining KELAG’s excellent credit rating in
The company still has stable cash inflows from operating
the long term is of crucial importance. In the financial year
activities. The financial strategy for 2019 centred on
2019, Standard & Poor’s confirmed the good “A” rating with
ensuring that the Group had stable internal financing as
a stable outlook.