Risk classification and risk assessment

The sections below describe the key risks to the Wilo Group. Suitable countermeasures, hedges and the general conditions are taken into account in calculating the respective probability of occurrence and potential loss.

The risks, their probabilities of occurrence and their possible financial impact on EBIT are measured and classified as follows:


Probability of occurrence

Unlikely ≤ 20 %
Possible > 20 % ≤ 50 %
Likely > 50 %

 

 

 


Potential impact on EBIT

Low ≤ 10 %
Medium > 10 % ≤ 50 %
High > 50 %

If the probability of occurrence of a potential risk is between 20 percent and 50 percent, the corresponding risk is classed as possible. A potential risk is considered likely if the possibility of this risk actually occurring is higher than 50 percent. 

In the event of the assumed occurrence of a risk, the possible financial impact on EBIT that can be derived is classified into one of three groups (low, medium, high) based on the forecast percentage deterioration of EBIT. An EBIT deterioration of between 10 percent and 50 percent is considered a medium earnings impairment. An earnings reduction that is feasible but considered low would therefore have an estimated negative effect on EBIT of up to 10 percent and a high financial impact would be a negative effect of more than 50 percent.


Overview of business risks

  Probability of
occurrence
Potential impact
on EBIT
General risks

Economic environment


Possible


Medium
Extraordinary external disruptions Unlikely Medium
Legal and regulatory environment Possible Medium

Industry-specific risks

Competition



Possible



Medium

Company-specific risks

Research and development



Possible



Low
Production Unlikely Medium
Human resources Possible Low
Information technology Unlikely Medium
Acquisitions and strategic partnerships Possible Medium

Financial risks

Exchange rates



Likely



Low
Interest* Possible None
Commodities Possible Low
Defaults Possible Low
Financing and liquidity Unlikely Low

* The possible impact of interest rate risk related to net finance costs and is classed as low. More detailed information can be found in section “Financial risks and opportunities” of the Group management report.

Order report

WILO SE
Corporate Communications
Nortkirchenstraße 100
44263 Dortmund
T +49 231 4102-0
F +49 231 4102-7363

Contact

WILO SE
Corporate Communications
Nortkirchenstraße 100
44263 Dortmund
T +49 231 4102-0
F +49 231 4102-7363