1. Performance
1.1 Segment information
|
Net revenue |
Total revenue |
Operating result (EBIT) |
|
||||||||
CHF million |
2019 |
|
2018 |
|
2019 |
|
2018 |
|
2019 |
|
2018 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Sheet Metal Processing |
936.0 |
|
1,013.2 |
|
941.3 |
|
1,032.5 |
|
121.1 |
|
132.5 |
|
Chemical Specialties (discontinued operations) |
346.6 |
|
382.9 |
|
341.8 |
|
383.0 |
|
14.2 |
|
5.8 |
|
Outdoor (discontinued operations) |
268.4 |
|
253.4 |
|
268.4 |
|
253.4 |
|
7.5 |
|
5.2 |
|
Glass Processing (discontinued operations) |
22.4 |
|
133.3 |
|
27.8 |
|
128.4 |
|
31.1 |
|
7.6 |
|
Total as per segment reporting |
1,573.4 |
|
1,782.8 |
|
1,579.4 |
|
1,797.3 |
|
173.8 |
|
151.1 |
|
Other |
–0.2 |
|
–0.6 |
|
–0.2 |
|
–0.6 |
|
–6.6 |
|
–4.3 |
|
Total as per income statement |
1,573.2 |
|
1,782.2 |
|
1,579.1 |
|
1,796.7 |
|
167.2 |
|
146.8 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net operating assets |
Employees |
|
|
|
|
|
|||||
CHF million |
2019 |
|
2018 |
|
2019 |
|
2018 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Sheet Metal Processing |
248.3 |
|
204.0 |
|
2,987 |
|
2,805 |
|
|
|
|
|
Chemical Specialties (discontinued operations) |
156.4 |
|
167.0 |
|
1,115 |
|
1,109 |
|
|
|
|
|
Outdoor (discontinued operations) |
149.6 |
|
126.7 |
|
899 |
|
882 |
|
|
|
|
|
Glass Processing (discontinued operations) |
|
|
21.9 |
|
|
|
436 |
|
|
|
|
|
Total as per segment reporting |
554.3 |
|
519.6 |
|
5,001 |
|
5,232 |
|
|
|
|
|
Other |
–3.6 |
|
0.5 |
|
25 |
|
27 |
|
|
|
|
|
Total as per income statement |
550.7 |
|
520.1 |
|
5,026 |
|
5,259 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Discontinued operations
Conzzeta sold the Glass Processing segment to the Finnish company Glaston Corporation effective as of April 1, 2019. The Glass Processing segment is shown under discontinued operations in below overview. Its net revenue, total revenue and operating result for 2019 comprise a 3-month period, whereas the comparison period comprises a 12-month period. Refer to note 4.1 for additional information on the transaction.
On December 9, 2019, Conzzeta announced that the Board of Directors of Conzzeta AG has decided that the Groupʼs future focus will be on the Bystronic business unit. The other business units are to be divested step by step within the period of a year, market conditions permitting. The segments Chemical Specialties and Outdoor are shown under discontinued operations in below overview. All companies in the business unit are affected by the sale. The companies are listed in note 4.2.
On December 20, 2019, Conzzeta announced the signing of a binding agreement to sell its business unit Schmid Rhyner to the German specialty chemicals group Altana. Closing of the transaction was on February 28, 2020.
Additional information to continuing operations and discontinued operations
The following table shows the income statement divided into continuing and discontinued operations. The discontinued operations include the Glass Processing segment until the closing of the transaction effective April 1, 2019, the resulting gain from disposal of CHF 29.9 million that was recorded in the first half of 2019 under “Other operating income“, as well as the segments Outdoor and Chemical Specialties.
CHF million |
Continuing operations |
|
Discontinued operations |
|
Total Group |
|
||||||
|
2019 |
|
2018 |
|
2019 |
|
2018 |
|
2019 |
|
2018 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net revenue |
935.8 |
|
1,012.6 |
|
637.4 |
|
769.6 |
|
1,573.2 |
|
1,782.2 |
|
Changes in inventories and own work capitalized |
5.3 |
|
19.3 |
|
0.6 |
|
–4.8 |
|
6.0 |
|
14.5 |
|
Total revenue |
941.1 |
|
1,031.9 |
|
638.0 |
|
764.8 |
|
1,579.1 |
|
1,796.7 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Other operating income |
10.5 |
|
5.7 |
|
32.5 |
|
2.7 |
|
43.0 |
|
8.4 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Material expenses |
–424.1 |
|
–481.1 |
|
–314.7 |
|
–394.3 |
|
–738.9 |
|
–875.4 |
|
Personnel expenses |
–222.6 |
|
–216.9 |
|
–156.3 |
|
–187.5 |
|
–378.9 |
|
–404.4 |
|
Other operating expenses |
–175.3 |
|
–197.3 |
|
–123.4 |
|
–144.9 |
|
–298.7 |
|
–342.2 |
|
Depreciation/impairments on property, plant and equipment |
–11.0 |
|
–10.5 |
|
–19.0 |
|
–19.3 |
|
–30.0 |
|
–29.8 |
|
Depreciation/impairments on intangible assets |
–4.2 |
|
–3.6 |
|
–4.3 |
|
–2.9 |
|
–8.5 |
|
–6.5 |
|
Operating result (EBIT) |
114.4 |
|
128.1 |
|
52.7 |
|
18.7 |
|
167.2 |
|
146.8 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Financial result |
3.9 |
|
2.2 |
|
–3.9 |
|
–4.8 |
|
–0.1 |
|
–2.6 |
|
Result from associated equity holdings |
|
|
|
|
|
|
0.1 |
|
|
|
0.1 |
|
Result before taxes |
118.3 |
|
130.4 |
|
48.8 |
|
14.0 |
|
167.1 |
|
144.3 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income taxes |
–24.8 |
|
–25.4 |
|
–5.6 |
|
–4.1 |
|
–30.3 |
|
–29.5 |
|
Group result |
93.6 |
|
105.0 |
|
43.3 |
|
9.9 |
|
136.8 |
|
114.8 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Accounting principles
For the purposes of segment reporting the revenues of the economically similar FoamPartner and Schmid Rhyner business units are grouped together in a single reporting segment. Given that this aggregated reporting segment is characterized by similar value drivers (e.g. innovation, life cycle, raw materials used) and risk factors, the informative value of the disclosed key figures per segment is not adversely affected.
Segment |
|
Business unit |
|
Description |
|
|
|
|
|
Sheet Metal Processing |
|
Bystronic |
|
Bystronic is a global manufacturer of laser cutting machinery and press brakes. The company also offers automation systems and integrated software solutions as well as maintenance and support services. The most important source of revenue is the sale and installation of machinery and spare parts and the provision of maintenance and other services. |
Chemical Specialties (discontinued operations) |
|
FoamPartner and Schmid Rhyner |
|
The FoamPartner business unit operates worldwide, developing, producing and processing high-grade polyurethane foam materials for the industry and comfort market segments. Schmid Rhyner develops and manufactures print varnishes for the graphics industry. The most important source of revenue in the Chemical Specialties segment is the sale of products to original equipment manufacturers. |
Outdoor (discontinued operations) |
|
Mammut Sports Group |
|
Mammut Sports Group develops, produces and markets equipment for mountaineering, climbing and winter sports worldwide. Its offering includes technical hardware, clothing and footwear. The most important source of revenue is the sale of such products. Products are sold mostly through specialist retailers as well as Mammut’s own stores and digital sales channels. |
Glass Processing (discontinued operations) |
|
Bystronic glass |
|
Bystronic glass is a global manufacturer of machinery and systems for processing flat glass in the architectural and automotive glass market sectors. The company’s offering ranges from individual machines, via spare parts and service to complete production lines. The most important source of revenue is the sale and installation of machinery, systems and spare parts, and the provision of maintenance and other services. |
|
|
|
|
|
1.2 Revenue and other operating income
Geographical information
CHF million |
2019 |
|
2019 |
|
2018 |
|
2018 |
|
|
|
|
|
|
|
|
|
|
Europe |
893.3 |
|
56.8% |
|
964.0 |
|
54.1% |
|
North and South America |
322.9 |
|
20.5% |
|
327.0 |
|
18.3% |
|
Asia and others |
356.9 |
|
22.7% |
|
491.2 |
|
27.6% |
|
Total |
1,573.2 |
|
100.0% |
|
1,782.2 |
|
100.0% |
|
|
|
|
|
|
|
|
|
|
Comparable net revenue
CHF million |
|
|
|
|
|
|
|
|
|
Net revenue 2019 |
1,573.2 |
|
|
|
|
|
|
|
|
Changes in Group revenue 2019 due to: |
|
|
|
|
– currency translation effects |
–29.7 |
|
–1.7% |
|
– acquisitions |
8.8 |
|
0.5% |
|
– divestments |
–100.0 |
|
–5.6% |
|
– changes in quantity and price |
–88.2 |
|
–4.9% |
|
Total change |
–209.0 |
|
–11.7% |
|
|
|
|
|
|
Net revenue 2018 |
1,782.2 |
|
100.0% |
|
|
|
|
|
|
The effects of transactions as part of acquisitions and divestments are recognized as changes in the scope of consolidation. Figures on a comparable basis take account of currency translation effects and changes in the scope of consolidation.
Other operating income
Other operating income includes mainly revenue from sale of materials, waste and scrap, from insurance contracts, and from the sale of property, plant and equipment and investments. The gain from disposal of the business unit Glass Processing of CHF 29.9 million is included in the year under review (refer to note 4.1).
Accounting principles
Revenue is recognized when goods or products are delivered or a service performed, and the benefits and risks as well as the power of disposal are transferred to the buyer. If the installation of the product at the recipient’s premises is an essential contract component, the revenue is not recognized until the installation is concluded. Longer-term orders are recognized using the completed contract method. The net revenue corresponds to the expected equivalent value of the service rendered, net of sales and value-added tax, any sales deductions such as sales bonuses, granted rebates and discounts as well as value adjustments and currency effects on trade receivables. Separable revenue is recognized and measured individually.
1.3 Operating expenses
Material expenses
Material expenses include the overall cost of raw materials, intermediates and supplies, as well as merchandise held for resale and expenses for third-party manufacturing, handling or processing of the Group’s products (external services).
In relation to total revenue growth of 12.1%, the decrease in material expenses is disproportionately high at 15.6%. The ratio of material expenses to total revenue (materials ratio) is 46.8%, which is 1.9 percentage points lower than in the previous year. The materials ratio is influenced mainly by changes in inventories of semifinished products, work in progress and finished products. Adjusted for this effect, it is 1.7 percentage points lower than in the previous year. The improvement in the materials ratio can mainly be attributed to a better product mix in the Sheet Metal Processing segment and more favorable purchase conditions in all segments.
Personnel expenses
CHF million |
2019 |
|
2018 |
|
|
|
|
|
|
Wages and salaries |
308.5 |
|
332.5 |
|
Social security benefits |
59.2 |
|
61.8 |
|
Other personnel expenses |
11.2 |
|
10.1 |
|
Total |
378.9 |
|
404.4 |
|
|
|
|
|
|
The decrease in personnel expenses amounts to 6.4% compared to previous year. Personnel expenses in relation to total revenue increased by 1.5 percentage points and is at 24.0%.
As at the balance sheet date, the number of employees declined by 4.4% over the previous year to 5,026. The decline can be attributed to the divestment of the segment Glass Processing, partly offset by increases in the other segments, particularly in the segment Sheet Metal Processing. The average headcount in the reporting year was 5,086 full-time positions (2018: 5,091).
Other operating expenses
Other operating expenses include the cost of repairs and maintenance on property, plant and equipment, sales provisions, expenses for guarantees, assembly, transport and energy, as well as sundry expenses for production, development, sales and administration.
1.4 Income taxes
CHF million |
2019 |
|
2018 |
|
|
|
|
|
|
Current taxes on income |
25.6 |
|
33.4 |
|
Deferred taxes |
4.7 |
|
–3.9 |
|
Total |
30.3 |
|
29.5 |
|
|
|
|
|
|
Current taxes on income include taxes paid and owed on taxable income of the individual companies.
|
Tax rate 2019 |
|
Income taxes 2019 |
|
Tax rate 2018 |
|
Income taxes 2018 |
|
|
|
|
|
|
|
|
|
|
Average applicable tax rate and income taxes (before consideration of tax loss carryforwards) |
19.7% |
|
33.0 |
|
19.7% |
|
28.4 |
|
Effects of change in tax loss carryforwards |
1.3% |
|
2.2 |
|
0.6% |
|
0.9 |
|
Average applicable tax rate and income taxes (after consideration of tax loss carryforwards) |
21.0% |
|
35.3 |
|
20.3% |
|
29.3 |
|
Other influences |
–2.9% |
|
–5.0 |
|
0.1% |
|
0.2 |
|
Effective tax rate and income taxes |
18.1% |
|
30.3 |
|
20.4% |
|
29.5 |
|
|
|
|
|
|
|
|
|
|
The expected tax rate of 19.7% (2018: 19.7%) corresponds to the weighted average tax rate in the respective tax jurisdictions. The effective tax rate for the ordinary result before taxes is 18.1% (2018: 20.4%). The decrease results mainly from non-taxable capital gains from the sale of the Glass Processing segment.
Deferred taxes are measured using the announced tax rates for the temporary differences in individual companies. The deferred tax assets from offsettable loss carryforwards and from temporary valuation differences amount to CHF 13.7 million (2018: CHF 14.9 million). In view of uncertainty about the future scope for offsetting, the tax effects from loss carryforwards amounting to CHF 7.5 million (2018: CHF 8.1 million) were not capitalized. This evaluation is based on the projected income tax rates. Deferred tax liabilities amount to CHF 23.1 million (2018: CHF 18.8 million).
The change in tax rates following the adoption of the reform of corporate taxation in Switzerland effective as of January 1, 2020, did not have a material impact on deferred tax assets and liabilities recognized in the balance sheet at year-end.
Significant estimates made by management
In order to determine the amount of current and deferred income tax assets and liabilities, significant estimates need to be made. Some of these estimates are based on the interpretation of existing tax legislation and regulations. Various internal and external factors may have favorable or unfavorable effects on the income tax assets and liabilities. These factors include, but are not limited to, changes in tax laws and regulations, changing interpretations of existing tax laws and regulations, changes in tax rates, and changes in overall levels of pre-tax earnings. Any such changes may impact the current and deferred income tax assets and liabilities recognized in the balance sheet in future reporting periods.
Accounting principles
Income taxes include current and deferred income taxes. Provisions are made for all tax obligations, regardless of their payment date. Deferred income tax is provided for all temporary differences arising between the tax bases of assets and liabilities and their carrying value for reporting purposes, using the currently enacted tax rates on an entity level. The change in these deferred taxes is recorded under tax expenditure. The deferred tax assets from offsettable loss carryforwards and from temporary valuation differences are only capitalized when in all probability future taxes on profits can be offset.
1.5 Earnings per share
CHF |
2019 |
|
2018 |
|
|
|
|
|
|
Group profit attributable to Conzzeta AG shareholders |
125,770,000 |
|
96,652,000 |
|
Average number of class A registered shares (par value: CHF 2.00) |
1,823,881 |
|
1,823,990 |
|
Average number of class B registered shares (par value: CHF 0.40) |
1,215,000 |
|
1,215,000 |
|
Earnings per class A registered share |
60.85 |
|
46.76 |
|
Earnings per class B registered share |
12.17 |
|
9.35 |
|
|
|
|
|
|
In the reporting year, as in the previous year, there was no dilution of earnings.
Accounting principles
Earnings per category of share were calculated on the basis of the portion of net income attributable to the shareholders of Conzzeta AG, based on their portion of the share capital and the average number of outstanding shares (issued shares less treasury shares).