Dottikon ES : Condensed Half-Year Report 2017/18

2017/18 Condensed Half-Year Report

2017/18

Dottikon ES Holding AG

Condensed Half-Year Report Your Specialist for Hazardous Reactions.

2 DOTTIKON ES Condensed Half-Year Report 2017/18

Content

Summary/Outlook 3

Group Financial Statements DOTTIKON ES Group 9

Consolidated Income Statements 10

Consolidated Statements of Comprehensive Income 11

Consolidated Balance Sheets 12

Consolidated Cash Flow Statements 13

Consolidated Statements of Changes in Equity 14

Notes 15

Investor Relations 16

This Half-Year Report 2017/18 in English includes only condensed financial information. The comprehensive Half-Year Report 2017/18 is available in German.

Dear Shareholder,

Herewith we present to you DOTTIKON ES Group's Condensed Half-Year Report 2017/18 for the period from April 1 to September 30, 2017.

In the first half of the current business year, net sales were 4 percent higher than in the previ- ous year. The production output - net sales plus inventory changes in semi-finished and fin- ished goods - rose by 9 percent. The increase was driven by the pharma sector and reflects ongoing strength in demand. Due to growth-related advance performances, material and personnel expenses as well as other operating expenses rose disproportionately. As a result, at CHF 20.1 million, EBITDA was slightly below the previous year's figure, and the EBITDA margin was 28.6 percent (previous year: 30.1 percent). Due to slightly lower depreciation and amortization compared to the previous-year period, EBIT remained at the previous year's level of CHF 11.5 million. In combination with the financial result, net income rose slightly to CHF 9.6 million (previous year: CHF 9.5 million), while the net income margin of 13.8 percent remained below the previous year's 14.1 percent. Cash flow from operating activities stood at CHF 39.0 million in the reporting period. Cash flow for investing activities in property, plant and equipment rose by 22 percent compared to the previous year to CHF 15.3 million related to chemical multipurpose pharma production capacities that were expanded and put into operation. Despite this, cash and cash equivalents and fixed deposits rose from CHF 50.7 million to CHF 74.5 million. The equity ratio stands at a solid 80.9 percent.

KEY FIGURES, APRIL-SEPTEMBER
CHF million (unaudited)	2016	2017	Changes
Net sales	67.6	70.1	3.7%
EBITDA	20.4	20.1	-1.5%
EBITDA margin (in % of net sales)	30.1%	28.6%
EBIT	11.5	11.5	0%
EBIT margin (in % of net sales)	17.0%	16.4%
Net income	9.5	9.6	1.6%
Net income margin (in % of net sales)	14.1%	13.8%
Operating cash flow	56.1	39.0	-30.4%
Employees (FTEs, six-month average)	536	563	5.0%

For the full business year 2017/18, we anticipate a further increase in net sales and net income against the background of ongoing demand from the pharma market as well as the further development and expansion of our project pipeline.

Global economic growth continued to improve in the period under review. Still, despite the brighter economic situation, inflation rates in industrialized nations largely remain low. Central banks on the whole maintain their expansive policies, even though the Federal Reserve has made an initial, modest step toward normalization by phasing out the purchase of securities. Despite this, the economic risk continues to rise. High government debt, low interest rates and the still low raw material and energy prices currently clash with increasing geopolitical tension, which creates a dangerous combination. Given the fickle unpredictability of the United States under their new president, options for the United States to counter Russia's demonstration of military might and expansion of power in the west as well as China's state- imposed forward integration and its hegemonic claim to power through the Belt and Road Initiative remain limited. The absence of profound reforms in Europe gives rise to shifts in the balance of political power and to secessionist tendencies. Potentates around the globe exploit this changing, multipolar environment marked by short-term power vacuums to strengthen their position by means of provocation or the creation of autocratic structures. This fosters ongoing regionalization and growing uncertainty. Amid this environment, values such as trust, reliability, and consistency - along with cultural and geographical proximity - continue to gain importance.