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Reconciliation of non-IFRS financial measures

In the discussion of TenneT’s financial results, a number of alternative performance measures (non-GAAP figures) are used to provide readers with additional financial information that is regularly reviewed by management. These 'underlying' (non-IFRS) figures should not be viewed as a substitute for TenneT’s financial results as determined in accordance with IFRS, which are presented in TenneT’s consolidated financial statements.

TenneT's main non-IFRS figures are explained below

EBITDA

TenneT defines EBITDA as operating result before interest, tax and depreciation (including impairments) of tangible fixed assets and amortisation (including impairments) of intangible assets.

(EUR million)20182017
IFRS EBIT880900
IFRS Depreciation and amortisation700629
IFRS EBITDA1,5801,529
Other underlying adjustments-74-3
Underlying adjustment depreciation2122
Underlying EBITDA1,5271,548

Net profit

The following table shows the underlying alignment between the IFRS and underlying net profit.

(EUR million)20182017
IFRS EBIT880900
IFRS finance result-181-170
IFRS tax expenses-189-177
IFRS net profit510553
Underlying EBIT adjustments-74-3
Underlying adjustment interest-9-24
Underlying adjustment deferred tax on to be settled in tariffs4429
Underlying adjustment deferred tax on auction receipts-27-33
Other underlying tax adjustments-19
Underlying Net Profit443531

Return on invested capital

ROIC is defined as 'underlying' EBIT (see note 2.3) as a percentage of the average invested capital during the year. The average invested capital is defined as the 'underlying' equity + loans and bank overdrafts minus cash at free disposal. Average is defined as sum of year-end and previous year-end figures divided by two.