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(21) Additional Capital Disclosures

Capital Structure Management

The primary objective of our capital structure management is to maintain a strong financial profile for investor, creditor, and customer confidence, and to support the growth of our business. We seek to maintain a capital structure that will allow us to cover our funding requirements through the capital markets at reasonable conditions, and in so doing, ensure a high level of independence, confidence, and financial flexibility.

SAP SE’s long-term credit rating is “A2” by Moody’s with stable outlook, and “A” by Standard & Poor’s with positive outlook. Standard & Poor’s raised the outlook to positive in 2016.

Capital Structure

12/31/2016 12/31/2015 ∆ in %
€ millions % of
Total Equity and Liabilities
€ millions % of
Total Equity and Liabilities
Equity 26,397 60 23,295 56 13
Current liabilities 9,674 22 7,867 19 23
Non-current liabilities 8,205 19 10,228 25 −20
Liabilities 17,880 40 18,095 44 −1
Total equity and liabilities 44,277 100 41,390 100 7

In 2016, we repaid €1,250 million in bank loans that we had taken to finance the Concur acquisition. The repayment was partly refinanced through the issuance of a €400 million Eurobond with a maturity of two years. We also repaid a US$600 million U.S. private placement tranche at maturity. Thus, the ratio of total financial debt to total equity and liabilities decreased by four percentage points to 18% at the end of 2016 (22% as at December 31, 2015).

Total financial debt consists of current and non-current bank loans, bonds, and private placements. The changes in our financial debts are reconciled to the cash flows from liabilities arising from financing activities below. For more information about our financial debt, see Note (17).

Reconciliation of Liabilities Arising from Financing Activities



€ millions 12/31/2015 Cash Flows Business Combi-nations Foreign Currency Fair Value Changes Other 12/31/2016
Current financial debt −567 547 −6 4 0 −1,413 −1,435
Non-current financial debt −8,607 852 −2 −46 0 1,413 −6,390
Financial debt (nominal volume) −9,175 1,400 −8 −42 0 0 −7,826
Basis adjustment −64 0 0 5 −27 0 −86
Transaction costs 44 0 0 0 0 −11 32
Financial debt (carrying amount) −9,195 1,400 −8 −37 −27 −11 −7,880
Accrued interest −45 0 0 1 0 −1 −45
Assets held to hedge financial debt 100 −43 0 −3 −6 0 47
Total liabilities from financing activities −9,141 1,357 −8 −40 −33 −12 −7,878

While we continuously monitor the ratios presented in and below the capital structure table above, we actively manage our liquidity and structure of our financial indebtedness based on the ratios group liquidity and net liquidity.

Group Liquidity

€ millions 2016 2015
Cash and cash equivalents 3,702 3,411 291
Current investments 971 148 823
Group liquidity 4,673 3,559 1,114
Current financial debt −1,435 −567 −868
Net liquidity 1 3,238 2,992 246
Non-current financial debt −6,390 −8,607 2,217
Net liquidity 2 −3,153 −5,615 2,462

Distribution Policy

Our general intention is to remain in a position to return liquidity to our shareholders by distributing annual dividends totaling more than 35% of our profit after tax as well as by repurchasing treasury shares in future periods.

In 2016, we distributed €1,378 million in dividends from our 2015 profit (compared to €1,316 million in 2015 and €1,194 million in 2014 related to 2014 and 2013 profit, respectively), representing €1.15 per share.

As a result of our equity-settled share-based payments transactions (as described in Note (27)), we have commitments to grant SAP shares to employees. We intend to meet these commitments by reissuing treasury shares or to fulfill these obligations through an agent who administers the equity-settled programs and therefor purchases shares on the open market.

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