FINANCING INSTRUMENTS AND MATURITY PROFILE
ProSiebenSat.1 Group uses various financing instruments. To meet its medium to long-term financing needs, the Company is financed by a term loan as part of a syndicated loan. In addition, the Company also makes use of the bond and promissory notes market. To meet its short-term and seasonal financing needs, the Company uses a revolving credit facility as part of a syndicated loan.
As per end of October 2020, ProSiebenSat.1 Media SE also established a Debt Issuance Program. This is a flexible financing program allowing the issuance of fixed and variable rate notes. The program has an overall volume of up to EUR 2.5 billion and aims especially at refinancing existing interest-bearing financial liabilities of ProSiebenSat.1 Group in the future. Amounts, terms and interest rates of the notes to be issued are determined by the conditions prevailing at the respective time of financing.
All of ProSiebenSat.1 Group’s corporate financing is unsecured. In April 2019 the Group extended the maturity for the vast majority of the syndicated credit agreement consisting of a term loan and a revolving credit facility until April 2024. The seven-year bond of EUR 600 million matures in April 2021 and is listed on the regulated market of the Luxembourg Stock Exchange (ISIN DE000A11QFA7). The bond coupon is 2.625 % per annum. In December 2016, the Company issued promissory notes (Schuldscheindarlehen) of EUR 500 million in total. The promissory notes comprise two seven-year maturities of EUR 225 million fix interest and EUR 50 million variable interest as well as a ten-year fix interest tranche of EUR 225 million.
ProSiebenSat.1 Group covers its financing requirements primarily with cash inflows from current business operations. Free advertising time on the TV stations is also an important investment currency to promote and acquire start-ups. Under the media-for-revenues and media-for-equity model, ProSiebenSat.1 Group participates in younger companies' value creation and thus expands its portfolio in Commerce in particular.
ProSiebenSat.1 invests in markets with long-term growth prospects. An important benchmark for planning financing is the Group's leverage factor. It gives the level of net financial debt in relation to LTM adjusted EBITDA - EBITDA adjusted for reconciling items that ProSiebenSat.1 Group realized in the last twelve months (LTM). The target for the ratio of net financial debt to LTM adjusted EBITDA is 1.5 to 2.5.
At the same time, the Company pursues an attractive total shareholder return for its shareholders and has also defined clear goals here. The target is to distribute a dividend of 50 % of the adjusted net income.