Group Management Report Products Safety and Health Environment Human Resources Social Commitment Consolidated Financial Statements 65
the first time for a full year, and due to continued high investment
in property, plant and equipment. The increase in
net working capital and changed exchange-rate relations also
contributed to the higher capital level.
In 2018, the return on capital employed (ROCE) amounted
to 9.4 % and thus did not reach the previous year’s level
(11.3 %). With an unchanged cost of capital rate of 8.0 %, the
relative AVA reached 1.4 % (previous year: 3.3 %).
Analogous to the expansion of the operating capital,
the cost of capital rose to 221.0 million (previous year:
€ 200.8 million). As a result, the absolute AVA amounted to
€ 37.6 million in the past business year (previous year:
€ 84.0 million).
The slight decrease of key value figures that was fore-
cast for 2018 due to the fact that the full capital effect
of business combinations
was considered for the first time
could not be achieved, particularly due to the weaker
earnings performance.
Overall Assessment of Our Business
Performance and Business Situation
In the course of 2018, the macroeconomic framework conditions
deteriorated increasingly. At the same time, the prices of raw
materials relevant for ALTANA rose significantly due to the crudeoil
price development.
Nevertheless, ALTANA achieved its growth targets in this challenging
business environment. However, the earnings performance
did not meet our expectations because we did not fully pass on
the raw-material price increases to the market. Nevertheless,
we continued to make considerable investments in our strategic
growth fields.
Our balance sheet continued to show a very solid structure at
the end of 2018 and offers sufficient financial headroom for investments
in sustainable profitable growth.