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Financial position

Report on expected developments – future development of the Group’s financial position

The company expects operating cash flow, which is Deutsche Börse Group’s primary funding instrument, to remain clearly positive in the forecast period. The Group expects that two significant factors will influence changes in liquidity. Firstly, the company plans to invest some €150 million per year in intangible assets and property, plant and equipment at Group level during the forecast period. These investments will be included in cash flows from investing activities, and will serve primarily to develop new products and services in the Eurex and Clearstream segments and to enhance existing ones. The total amount mainly comprises investments in trading infrastructure and in risk management functionalities. Secondly, the Executive Board and Supervisory Board of Deutsche Börse AG will propose a dividend of €2.35 per share to the Annual General Meeting to be held in May 2017. This would correspond to a liquidity outflow of about €440 million. Apart from the above, no other material factors were expected to impact the Group’s liquidity at the time the management report was prepared. As in previous years, the Group assumes that it will have a sound liquidity base due to its positive cash flow, adequate credit lines (see note 36 to the consolidated financial statements for details), and flexible management and planning systems.

Within the framework of a programme to optimise its capital structure, Deutsche Börse Group generally aims to distribute dividends equivalent to between 40 and 60 per cent of adjusted net profit for the period attributable to Deutsche Börse AG shareholders. In recent years (where the Group’s net profit was lower), the dividend payout ratio was kept at the upper end of this range, in order to distribute stable dividends to shareholders. Given that the Group’s profit targets were raised in July 2015, in connection with the announcement of the “Accelerate” growth strategy, the company aims for a dividend payout ratio in the middle of the range between 40 and 60 per cent going forward.

Moreover, until 2012 the company distributed a part of freely available funds to shareholders, via share buy-backs. Since 2013, these funds have been used predominantly to support the company’s development, as well as to fulfil credit rating and regulatory capital requirements. Against the background of the growth strategy announced in 2015, the company anticipates that in future, freely available funds will increasingly be applied not only to support the Group’s organic growth, but also to complementary external growth options.

To maintain its strong credit ratings at Group level, the company aims at a ratio of interest-bearing gross debt to EBITDA of no more than 1.5. The Group expects to reach or slightly come below this figure in 2017, depending on net revenue developments.

The parent company, Deutsche Börse AG, plans to invest some €30 million in intangible assets and property, plant and equipment during the forecast period.