Bonds & Credit Rating
In November 2015 DSM presented Strategy 2018: Driving Profitable Growth. With this new strategy DSM aims to capture the full potential of the portfolio it has created and translate this into improved financial results, focusing on organic sales growth, reducing costs and strict capital allocation.
Most of DSM's external funding needs are financed through long-term debt. Debt covenants are not included in the terms and conditions of outstanding bonds and financing arrangements. DSM aims to spread the maturity profile of outstanding bonds in order to have adequate financial flexibility.
DSM has a commercial paper program of €1,500 million that is available and two committed credit facilities totaling €1,000 million, consisting of €500 million maturing in September 2018 and €500 million in March 2020.
DSM's policy in the various sub-disciplines of the finance function is strongly oriented toward solidity, reliability and protection of cash flows. The finance function plays an important role in business steering.
Royal DSM aims to maintain a strong investment grade long-term credit rating for senior unsecured debt. To this purpose, regular review meetings between rating agencies and DSM senior management are arranged. The rating agencies Moody’s and Standard & Poors have awarded the following ratings for the company’s short-term debt and long-term debt:
|Rating Agency||Long/short term rating||Outlook||Last Update|
|Moody's||A3 / P-2||Negative||13 December 2016|
|Standard & Poor's||A- / A-2||Stable||30 March 2017|
Other Bonds consist of US Private Placement issued in the US in 2003 for 300 mln USD, of which 150 mln USD matured in 2013 and 150 mln USD matures in 2015.
The weighted average interest rate of the bonds (including derivatives) was 3.41% in 2015.
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