Huber+Suhner : FY 2023 Alternative Performance Measures

HUBER+SUHNER Annual Report 2023

Alternative Performance Measures

HUBER+SUHNER uses alternative performance measures as guidance parameters for both internal and external reporting to stakeholders. HUBER+SUHNER uses the following definitions, which may differ from the one other companies use.

This document has been prepared in conformity with the Directive on the Use of Alternative Performance Measures issued by SIX Exchange Regulation Ltd.

Organic sales development

The organic sales development is calculated by adjusting the reported net sales for the impact of currency effects, copper price effects as well as portfolio effects (acquisitions and disposals). When determining the currency effects, the functional currency that is valid in the respective country is used.

Order intake

A new order is recognised as an order intake only when the contract creates enforceable obligations between the Group and its customer. When this condition is met, the order is recognised at the contract value.

Book-to-bill

The book-to-bill is the ratio of total order intake third to total net sales third.

Order backlog

The order backlog represents the amount of booked orders not yet delivered/invoiced at a closing date. The order backlog is calculated as follows:

• order backlog at the beginning of the year;
• plus order intake during the reporting period;
• less cancellations of orders recorded;
• less sales recognised during the reporting period.

EBIT

EBIT is calculated by subtracting cost of goods sold and operating expenses from net sales.

	2023	2022
Net sales	851.1	954.6
Cost of goods sold	(550.5)	(614.1)
Gross profit	300.6	340.5
Selling, administrative and research and development expense	(226.6)	(239.8)
Other operating expense / income	3.6	2.5
EBIT (= operating profit)	77.6	103.2

Alternative Performance Measures - All amounts are in CHF million

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HUBER+SUHNER Annual Report 2023

EBITDA

The EBITDA corresponds to the operating profit (EBIT) before depreciation of property, plant and equipment and amortisation of intangible assets.

	2023	2022
EBIT (= operating profit)	77.6	103.2
Depreciation of property, plant and equipment	28.6	27.7
Amortisation of intangible assets	4.4	4.4
EBITDA	110.5	135.3

Return on invested capital (ROIC)

The return on invested capital (ROIC) measures how efficiently the invested capital is used. It is defined as net operating profit after taxes (NOPAT) divided by the average invested capital. The average is calculated by adding the invested capital at the beginning of the period to that at the end of the period and dividing the sum by two.

Invested capital and NOPAT are defined as follows:

	31.12.2023	31.12.2022
Trade receivables	131.1	162.2
Other short-term receivables (excl. derivative financial instruments)	20.6	28.2
Inventories	163.2	193.9
Accrued income	5.1	4.1
Property, plant and equipment (excl. undeveloped property)	224.5	211.9
Intangible assets	28.8	26.3
Deferred tax assets	14.0	10.5
Operating assets	587.3	637.2
Trade payables	(60.6)	(76.1)
Other short-term liabilities (excl. derivative financial instruments)	(49.8)	(65.9)
Short-term provisions	(10.2)	(17.2)
Accrued liabilities	(15.7)	(19.5)
Other long-term liabilities	(2.3)	(2.7)
Long-term provisions (excl. retirement plan obligations)	(6.0)	(6.3)
Deferred tax liabilities	(21.3)	(18.9)
Operating liabilities	(165.8)	(206.5)
Invested capital	421.4	430.6
	2023	2022
Average invested capital	426.0	415.3
EBIT (= operating profit)	77.6	103.2
Effective income tax rate	13.1%	16.0%
Income taxes	(10.2)	(16.5)
NOPAT (= net operating profit after taxes)	67.4	86.7
Return on invested capital (ROIC) in % = NOPAT / average invested capital	15.8%	20.9%

Alternative Performance Measures - All amounts are in CHF million

99

HUBER+SUHNER Annual Report 2023

Free operating cash flow

Free operating cash flow is defined as cash flow from operating activities (excl. purchases of marketable securities) less cash flow from investing activities.

	2023	2022
Cash flow from operating activities	115.7	87.3
Cash flow from investing activities (excl. marketable securities)	(52.0)	(49.7)
Free operating cash flow	63.7	37.7

Free cash flow

	2023	2022
Free operating cash flow	63.7	37.7
Payment of dividend	(38.8)	(38.2)
Payment of dividend to minority interests	(0.3)	(0.6)
Purchase of treasury shares	(9.0)	(63.1)
Free cash flow	15.6	(64.4)

Net liquidity

	2023	2022
Cash and cash equivalents	108.1	151.1
Marketable securities	55.0	0
Short-term financial liabilities	0	0
Net liquidity	163.1	151.1

Due to rounding, numbers presented throughout this report may not add up precisely to the totals provided. All ratios and deltas are calculated using the underlying amount rather than the presented rounded amount.

Alternative Performance Measures - All amounts are in CHF million

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