Grifols follows the recommendations of the CNMVThis Thursday, it reaffirmed this ratio, but, at the request of the CNMV, provided a different calculation method, consolidating the Ebitda after profit and loss and after the net debt already shown in the company’s annual accounts.
The debt-to-Ebitda ratio is the most commonly used indicator of a company’s debt in the business world because it compares total debt to gross operating profit.
Bearish investor Gotham caused Grifols shares to crash in early January by questioning debt ratios that put the company at 10 to 13 times Ebitda, about double what the company reported.
Associated debts
This criterion is also used to exclude from the calculation the debts related to the rental of the premises of the plasma donation centers, which, according to the CNMV, amount to another 1,111 million euros.
Grifols assures in a statement that, in addition to complying with all the guidelines established by the CNMV, it will continue to calculate its debt ratio according to the criteria of the loan agreement.
In addition to the commitment to reduce the number of metrics used to reflect Ebitda and to define in detail each financial indicator it uses, the multinational blood products company commits to detail the Ebitda and financial debt of the relevant companies in which it holds non-controlled shares to specify.
Grifols is committed to taking additional measures
In a statement, the multinational blood company assures that it is “committed to taking all the measures specified in its communication to the CNMV, including any additional measures necessary to ensure the quality and consistency of the information provided to financial markets and investors .” », as well as “fully complying” with the guidelines and recommendations of the European Securities and Markets Authority (ESMA) and the CNMV.
In this sense, Grifols also proposes that “it will strengthen control procedures to minimize the possibility of errors in the calculation and breakdown of financial figures in its financial reports and results announcements” and commits to “establishing a new level of responsible verification “. the company’s internal control department.
Although the CNMV found no material errors or “evidence” that its debt figures did not reflect reality, it did find “significant deficiencies” in the presentation of some parameters.
The watchdog asked the hemoderivative manufacturer to publish within fifteen days details of the gross operating profit (EBITDA) and net financial debt at the end of the 2022 and 2023 financial years “of the most relevant companies in which there is no control holdings ».
The aim was to give investors the opportunity to calculate the company’s leverage ratio “taking into account or excluding the Ebitda and debt” of the investees.
ImmunoTek
This is the case, for example, with the cooperation agreement signed with ImmunoTek to establish the company Biotek America. The CNMV considered that the accounting treatment in 2021 and 2022 was “not appropriate” and should have been recorded as a “joint activity” and not as a financial investment.
The report prepared by the CNMV after the analysis of Grifols’ financial statements initially ruled out that the company had to restate its results, but considered it “likely” that it would have to adjust the 2022 and 2023 accounts once the deficiencies were identified Report has been corrected. Accounting treatment of the agreement signed with Immunotek.
Restatement of a company’s financial statements is reserved for situations of “extraordinary nature” and “extreme relevance” affecting the financial position of a company, while restatement is intended to correct errors in the information provided in accordance with accounting standards.
The CNMV launched an investigation on January 9 after learning of the Gotham City Research report on financial information released by Grifols between 2018 and 2022.