90097 cicor gb15 inh de c x4 · in chf 1 000 notes 2015 2014 loss/profit before tax –3 811 8 958...
TRANSCRIPT
FINANCIAL REPORT
CONSOLIDATED FINANCIAL STATEMENTS OF THE CICOR TECHNOLOGIES GROUP
Consolidated balance sheetConsolidated income statement Consolidated cash flow statementConsolidated statement of changes in equityNotes to the consolidated financial statementsReport of the statutory auditor on the consolidated financial statements
FINANCIAL STATEMENTS OF CICOR TECHNOLOGIES LTD.
Balance sheetIncome statementNotes to the financial statementsReport of the statutory auditor on the financial statements
424344454671
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Cicor | Financial Report 2015 | Consolidated Financial Statements 41
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42 Cicor | Financial Report 2015 | Consolidated Financial Statements
CONSOLIDATED BALANCE SHEET
in CHF 1 000 Notes 31.12.2015 in % 31.12.2014 in %
Assets
Property, plant and equipment (5) 45 041 29.8 50 477 33.6
Intangible assets (6) 787 0.5 1 066 0.7
Deferred tax assets (11) 4 082 2.7 3 572 2.4
Non-current assets 49 910 33.0 55 115 36.7
Inventories (7) 41 459 27.4 42 127 28.1
Trade accounts receivable (8) 27 791 18.4 30 869 20.6
Income tax receivable 4 0.0 37 0.0
Other accounts receivable (8) 3 685 2.4 3 983 2.6
Prepaid expenses and accruals 784 0.5 993 0.7
Cash and cash equivalents (9) 27 681 18.3 17 006 11.3
Current assets 101 404 67.0 95 015 63.3
Total assets 151 314 100.0 150 130 100.0
Liabilities and shareholders’ equity
Ordinary share capital 29 022 19.2 28 922 19.3
Share premium 113 455 75.0 114 308 76.1
Treasury shares –37 –0.0 –37 –0.0
Retained earnings –80 575 –53.3 –76 593 –51.0
Translation reserve –2 324 –1.5 533 0.3
Equity attributable to Cicor shareholders 59 541 39.4 67 133 44.7
Non-controlling interests 159 0.1 306 0.2
Total equity 59 700 39.5 67 439 44.9
Long-term provisions (10) 2 875 1.9 2 016 1.4
Deferred tax liabilities (11) 902 0.6 1 219 0.8
Long-term financial liabilities (12) 43 668 28.9 32 780 21.8
Liabilities for post-employment benefits (13) 1 652 1.1 1 306 0.9
Other long-term liabilities 12 0.0 44 0.0
Non-current liabilities 49 109 32.5 37 365 24.9
Short-term financial liabilities (12) 4 547 3.0 5 459 3.6
Trade accounts payable 21 831 14.4 23 658 15.8
Other current liabilities (14) 6 514 4.3 6 912 4.6
Accruals (14) 6 233 4.0 7 010 4.7
Short-term provisions (10) 3 278 2.2 1 979 1.3
Income tax payable 102 0.1 308 0.2
Current liabilities 42 505 28.1 45 326 30.2
Total liabilities 91 614 60.5 82 691 55.1
Total equity and liabilities 151 314 100.0 150 130 100.0
General remark to the notes of the consolidated financial statements: Unless otherwise stated all amounts in CHF 1 000
CONSOLIDATED FINANCIAL STATEMENTS
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Cicor | Financial Report 2015 | Consolidated Financial Statements 43
CONSOLIDATED INCOME STATEMENT
in CHF 1 000 Notes 2015 in % 2014 in %
Net Sales (4) 180 612 100.0 202 458 100.0
Change in inventory of finished and unfinished goods 5 0.0 1 577 0.8
Material costs –89 466 –49.5 –103 482 –51.1
Personnel costs (21) –56 889 –31.5 –58 820 –29.1
Other operating income 1 181 0.7 2 101 1.0
Other operating expenses (23) –23 326 –12.9 –24 172 –11.9
Restructuring costs (10) –4 718 –2.6 – 0.0
Depreciation (5) –8 702 –4.8 –8 788 –4.3
Amortization (6) –349 –0.2 –645 –0.3
Operating loss/profit (EBIT) –1 652 –0.9 10 229 5.1
Financial income (24) 5 504 3.0 4 844 2.4
Financial expenses (24) –7 663 –4.2 –6 115 –3.0
Loss/profit before tax (EBT) –3 811 –2.1 8 958 4.4
Income tax (11) –245 –0.1 –1 952 –1.0
Net loss/profit –4 056 –2.2 7 006 3.5
Attributable to:
– Cicor shareholders –3 982 6 896
– Non-controlling interests –74 110
Earnings per share (CHF)
– basic (19) –1.37 2.39
– diluted (19) –1.37 2.38
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44 Cicor | Financial Report 2015 | Consolidated Financial Statements
CONSOLIDATED CASH FLOW STATEMENT
in CHF 1 000 Notes 2015 2014
Loss/profit before tax –3 811 8 958
Depreciation (5) 8 702 8 788
Impairment (10) 3 463 –
Amortization (6) 349 645
Interest income (24) –57 –178
Interest expenses (24) 1 767 1 775
(Gain)/loss on disposal of assets –41 –86
Increase/(decrease) in provisions 934 –174
Increase/(decrease) in other non-current liabilities –29 –2
Unrealized currency (gains)/losses 507 –298
Subtotal before working capital changes 11 784 19 428
Decrease/(increase) in inventories –986 –890
Decrease/(increase) in trade accounts receivable 859 –966
Decrease/(increase) in other current assets 1 227 1 228
(Decrease)/increase in trade accounts payable 157 2 519
(Decrease)/increase in other current liabilities –3 413 –744
(Increase)/decrease in working capital –2 156 1 147
Income tax paid –788 –901
Interest paid –881 –1 541
Interest received 57 178
Net cash from operating activities 8 016 18 311
Purchase of property, plant and equipment (5) –8 453 –10 618
Proceeds from sale of property, plant and equipment 45 268
Purchase of intangible assets (6) –153 –154
Net cash used in investing activities –8 561 –10 504
Proceeds from issue of share capital 288 335
Payment to shareholders from capital contribution reserves –1 041 –866
Payment of finance lease liabilities 84 –814
Proceeds from borrowings 15 943 3 418
Repayment of borrowings –3 536 –7 798
Net cash from/(used in) financing activities 11 738 –5 725
Currency translation effects –518 –445
Net increase/(decrease) in cash and cash equivalents 10 675 1 637
Cash and cash equivalents at the beginning of the period (9) 17 006 15 369
Cash and cash equivalents at the end of the period (9) 27 681 17 006
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Cicor | Financial Report 2015 | Consolidated Financial Statements 45
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
in CHF 1 000 Share capital
Share premium
Treasury shares
Retained earnings
Translation reserve
Equity attributable
to Cicor shareholders
Non- controlling
interest
Total equity
Balance at 1 January 2014 28 806 114 955 –37 –83 489 – 60 235 258 60 493
Net profit 6 896 6 896 110 7 006
Dividend/capital contribution paid to shareholders –866 –866 –866
Capital increase for the established stock option plans 116 219 335 335
Translation adjustment 533 533 –62 471
Balance at 31 December 2014 28 922 114 308 –37 –76 593 533 67 133 306 67 439
in CHF 1 000 Share capital
Share premium
Treasury shares
Retained earnings
Translation reserve
Equity attributable
to Cicor shareholders
Non- controlling
interest
Total equity
Balance at 1 January 2015 28 922 114 308 –37 –76 593 533 67 133 306 67 439
Net loss –3 982 –3 982 –74 –4 056
Dividend/capital contribution paid to shareholders –1 041 –1 041 –1 041
Capital increase for the established stock option plans 100 188 288 288
Translation adjustment – –2 857 –2 857 –73 –2 930
Balance at 31 December 2015 29 022 113 455 –37 –80 575 –2 324 59 541 159 59 700
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46 Cicor | Financial Report 2015 | Consolidated Financial Statements
1. CORPORATE INFORMATIONCicor Technologies Ltd., Boudry, is a public company, the shares of which are traded on the Swiss Stock Exchange (SIX).
Cicor Group offers a seamless production and service chain for electronic components and systems – from develop-ment and engineering to large-scale manufacturing, after-sales service and product lifecycle management. Mainly active in Europe, the USA and Asia, Cicor’s main competences are: – Manufacture of PCBs and HDIs – rigid, rigid-flexible and flexible
– Hybrid manufacturing (thin/thick film, RF boards) – Quick turn prototypes, small, medium and large series – Microassembly (SMD, wire bonding, flip chip, etc.) – Packaging – Outsourcing services for the manufacture of electronic mod-ules, component groups and complete electronic products (EMS: Electronic Engineering and Manufacturing Services)
2. BASIS OF THE CONSOLIDATED FINANCIAL STATEMENTS
2.1 BASIS OF PREPARATION
Statement of complianceThe consolidated financial statements of the Cicor Group are based on uniform accounting and valuation principles applica-ble to all subsidiaries of the Group. The consolidated financial statements have been prepared in accordance with Swiss GAAP FER (GAAP = Generally Accepted Accounting Principles / FER = Fachempfehlungen zur Rechnungslegung) and the require-ments of the Swiss Code of Obligations.
The consolidated financial statements of Cicor Group for the year ended 31 December 2015 were authorized for issue on 8 March 2016 and are subject to approval at the Shareholders’ Meeting of 19 April 2016.
Conversion to Swiss GAAP FEROn 20 February 2015, the Board of Directors decided to change the Group’s financial reporting standard to Swiss GAAP FER with effect from 1 January 2015. Up to 31 December 2014, Cicor Technologies had prepared its interim and annual financial statements in accordance with the International Financial Reporting Standards (IFRS), which have been applied since 1998. The switch to Swiss GAAP FER was performed in retro-spect from 1 January 2014. The consolidated financial state-ments 2015 of Cicor have been prepared for the first time in accordance with Swiss GAAP FER. The change to Swiss GAAP
FER marks a decision for a more pragmatic standard of com-parative informational value that meets the requirements of an international, medium-sized company while being less complex and thus reducing costs. The application of Swiss GAAP FER continues to guarantee transparent reporting in accordance with the principle of true and fair view.
The accounting principles applied in the preparation and presentation of the 2015 consolidated financial statements de-viate in the following essential points from the consolidated annual financial statements for 2014 prepared according to IFRS:
Goodwill from acquisitionsUnder IFRS, goodwill was capitalized, not amortized but tested for impairment annually. Swiss GAAP FER 30 ”Consolidated financial statements“ gives the option of either offsetting the goodwill as at the acquisition date with equity, or capitalizing and amortizing it, usually over five years, in justified cases over 20 years at the most. Cicor decided to capitalize goodwill and depreciate it over the recommended period by Swiss GAAP FER of five years. Most of the goodwill is already fully amortized at 1 January 2014, Cicor’s date of transition to Swiss GAAP FER.
Employee benefit obligationsUnder IFRS (IAS 19), the pension plans of Cicor Technologies in Switzerland and in Germany qualify as defined benefit plans. The calculation was performed annually by a qualified actuary using the projected unit credit method. The net obligation with respect to defined benefit plans was calculated separately for each plan by estimating the amount of future benefit that em-ployees have earned in return for their service and deducting the fair value of plan assets. By contrast Swiss GAAP FER 16 stipulates that a provision only needs to be recognized, if an economic obligation exists and the conditions for the forma-tion of a provision are met, e.g. to cover a underfunding. For the calculation of the pension cost and the surplus or deficit, the financial statement of the pension plans drawn up in ac-cordance with Swiss GAAP FER 26 should be used. Employer contribution reserves are recognized as assets. Cicor dissolved all obligations except the ones for Reinhardt Microtech GmbH and RHe Microsystems GmbH.
Intangible assetsUnder IFRS, brand names, customer relationships and technol-ogies acquired in a business combination were separately cap-italized and amortized over their estimated useful economic lives as part of the purchase price allocation. Intangible assets with an infinite lifespan, however, were not depreciated on a
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
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Cicor | Financial Report 2015 | Consolidated Financial Statements 47
regular basis under IFRS (impairment only approach). Under Swiss GAAP FER, the amortization period is 20 years at most (even if the lifespan is infinite). Cicor will depreciate intangible assets for which the useful life cannot be clearly determined over the period recommended by Swiss GAAP FER of five years. Intangible assets include capitalized development costs. If the capitalization criteria were fulfilled, it was a requirement by IFRS to capitalize these costs. Swiss GAAP FER however permits an option as to whether capitalize or immediately recognize the development costs as expense. Cicor will continue to capitalize all development costs if the conditions of FER 10 are met, and depreciate these assets over a period of five years.
Deferred income taxesThe above-mentioned valuation and balance sheet adjustments have consequences for deferred income taxes in the balance sheet and income statement.
Presentation and structureThe presentation and structure of the balance sheet, income statement, statement of changes in equity and the cash flow statement were adjusted to meet the requirements of Swiss GAAP FER. The previous periods were reported as required under Swiss GAAP FER. As a result of the first time adoption of Swiss GAAP FER, accumulated translation differences are offset with retained earnings as of 1 January 2014. The implications of the above-mentioned adjustments for equity and the net profit of Cicor Technologies are summarized in the table below:
until the date that control ceases. A list of all subsidiaries is disclosed in note 3. Cicor does not hold any subsidiaries, in-vestments, assets or liabilities which are not fully consolidated within the financial statements of the Cicor Group.
Upon the loss of control the Group derecognizes the assets and liabilities of the subsidiary, any non-controlling interests and the other components of equity related to the subsidiary. Any surplus or deficit arising on the loss of control is recognized in profit or loss.
Non-controlling interests in equity and profit are shown separately. Changes in the Group’s interest that do not result in a loss of control are accounted for as equity trans-actions. The carrying amounts of the Group’s interests and the non-controlling interests are adjusted to reflect the changes in their relative interests in the subsidiaries. Any difference between the amount by which the non-controlling interests are adjusted and the fair value of the consideration paid or received is recognized directly in equity and attributed to owners of the Group. Intercompany balances, transactions and profits are eliminated on consolidation.
in CHF 1 000 1.1.2014 31.12.2014
Equity according to IFRS 125 853 125 602
Intangible assets –79 567 –78 805
Liability for post-employment benefits 14 043 22 230
Deferred tax –100 –1 852
Translation adjustment 264 264
Equity according to Swiss GAAP FER 60 493 67 439
1.1.–31.12.2014
Net profit according to IFRS 6 202
Depreciation/Amortization of Intangible assets 810
Personnel costs –168
Interest costs 358
Deferred tax –196
Net profit according to Swiss GAAP FER 7 006
Basis of measurementThe consolidated financial statements have been prepared on an accrual basis under the historical cost convention except for de-rivative financial instruments which are measured at fair value.
Presentation currencyThe consolidated financial statements are presented in Swiss francs (CHF).
2.2 SIGNIFICANT ACCOUNTING PRINCIPLES
Basis of consolidationThe consolidated financial statements comprise the financial statements of Cicor Technologies Ltd. and all subsidiaries which the parent company, directly or indirectly, controls either by holding more than 50% of the voting rights or by otherwise having the power to govern their operating and financial poli-cies. These subsidiaries are fully consolidated. The financial statements of subsidiaries are included in the consolidated financial statements from the date that control commences
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48 Cicor | Financial Report 2015 | Consolidated Financial Statements
Purchase methodAcquisitions of subsidiaries and businesses are accounted for using the purchase method. The consideration paid plus directly attributable transaction costs for each acquisition are eliminat-ed at the date of acquisition against the fair value of the net assets acquired, determined based on uniform accounting policies. Any excess of the consideration transferred over the net assets acquired is recognized as goodwill. Goodwill is amor-tized over five years.
Foreign currency conversionTransactions in foreign currencies are converted at the rate of exchange as of the transaction date. Gains and losses from for-eign currency transactions and from converting year-end foreign currency balances are recognized in the income statement.
Foreign exchange differences on long-term loans to foreign operations with equity characteristics, where a repay-ment is neither likely nor planned, are recognized in equity.
The financial statements of subsidiaries that report in foreign currencies are translated into Swiss francs as follows: – balance sheet items: at year-end exchange rates – income statement and cash flow statement items: at average exchange rates for the year
– Equity is translated at historical rates
The translation differences resulting from the conversion of financial statements denominated in foreign currencies are directly charged to equity. At the date of sale of a foreign sub-sidiary, the respective cumulative foreign currency translation differences are recognized in profit or loss.
Foreign exchange rates 2015 2014
Closing EUR 1.0807 1.2027
USD 0.9891 0.9899
RON 0.2386 0.2680
SGD 0.6996 0.7484
CNY 0.1523 0.1618
Average EUR 1.0680 1.2146
USD 0.9623 0.9152
RON 0.2403 0.2733
SGD 0.7001 0.7222
CNY 0.1545 0.1489
Segment informationSegment information presented is based on the internal report-ing regularly provided to the Board of Directors. This reporting includes discrete financial information for the two divisions AMS and ES which were identified as the two segments of the Group.
Property, plant and equipmentItems of property, plant and equipment are individually meas- ured at cost less accumulated depreciation and accumulated impairment losses. Depreciation is computed on a straight-line basis over the estimated useful life of the assets as follows:
Land*
Buildings 25–50 years
Improvements max 10 years
Machinery 3–10 years
Furniture 5–15 years
Equipment 3–10 years
Vehicles 4 years
* Land is not depreciated as it is deemed to have an indefinite life.
When parts of an item of property, plant and equipment have different useful lives, they are accounted for as separate items (major components) of property, plant and equipment.
Subsequent expenditure is capitalized if the market value or the value in use or the useful live of the respective item of property, plant and equipment has increased substantially.
GoodwillGoodwill represents the excess of the consideration trans- ferred over the Group’s interest in the net of the identifiable assets acquired and the liabilities assumed measured at fair value. Subsequently, goodwill is measured at cost less accu-mulated amortization and accumulated impairment losses. Goodwill is amortized over five years, in justified cases over 20 years at the most.
Other intangible assetsOther intangible assets are measured at cost less accumulated amortization and accu mulated impairment losses. Amortization is computed on a straight-line basis over the estimated useful life of the asset (normally 5 years, in justified cases over 20 years at the most).
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Cicor | Financial Report 2015 | Consolidated Financial Statements 49
Impairment of assetsProperty, plant and equipment as well as intangible assets are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of the asset may not be recoverable. If such indication exists, then the as-set’s recoverable amount is estimated.
An impairment loss is recognized in profit or loss when the carrying amount of an asset exceeds its estimated recover-able amount. The recoverable amount of an asset or a group of assets is the greater of its value in use and its net selling price. In assessing value in use, the estimated future cash flows from continuing use of an asset or a group of assets that are largely independent of cash flows of other assets are discounted to their present value using a pre-tax discount rate that reflects current market assessments of the time value of money and the risks specific to the asset. The relevant cash flows are based on the most recent business plans of these cash-generating units (period of three years) and the assumptions therein concerning development of prices, markets and market shares. Assets for which an impairment loss was recognized are reviewed at each reporting date for any indications that the loss has decreased or no longer exists. An impairment loss is re versed only if there has been a change in the estimates used to determine the recover able amount. The reversal is limited to the amount that would have been determined, net of depreciation or amortiza-tion, if no impairment had been recognized. Such reversal is recognized in profit or loss. Impairment losses on goodwill are not reversed.
Impairment losses recognized in respect of cash-gen-erating units are allocated first to reduce the carrying amount of any goodwill allocated to the units and then to reduce the carrying amounts of the other assets in the unit (group of units) on a pro rata basis.
Leasing agreementsFixed assets acquired under leasing contracts where both the risks and rewards of ownership are substantially transferred to Cicor, are classified as finance leases. Such assets are recorded at the lower of the estimated net present value of future lease payments and the estimated fair value of the asset at the inception of the lease. Assets under finance leases are fully amortized over the shorter of the lease term and its useful life. The corresponding lease obligations, ex cluding finance charges, are included in either short or long-term financial debt. Lease installments are divided into an interest and a redemption com-ponent.
Operating lease payments are recognized as an expense in profit or loss on a straight-line basis over the lease term.
InventoriesInventories are valued at the lower of purchase or manufac-turing costs and fair value less cost to sell. Costs for raw ma-terial are measured according to the weighted average cost method. Cost of work-in-progress and finished goods include materials, related manufacturing labor and related overheads. Concerning work-in-progress, estimated losses correspond to the negative difference between the fair value less cost to sell and the estimated costs until finalization of work-in-progress.
Trade accounts receivableTrade accounts receivable are measured at nominal value less necessary allowances for bad debts. The Group establishes an allowance for impairment that represents its estimate of incurred losses in respect of trade accounts receivables. The main com-ponents of this allowance are a specific loss component that relates to individually significant exposure, and a collective loss component established for groups of assets with similar risk characteristics in respect of losses that have been incurred but not yet identified. The collective loss allowance is determined based on historical data of payment statistics for similar receiv-ables.
Cash and cash equivalentsCash and cash equivalents are stated at amortized costs and include cash on hand, postal and bank accounts at sight and time deposits with maturities at the balance sheet date of 90 days or less.
Bank borrowings, trade and other liabilitiesNon-derivative financial liabilities are initially recognized at fair value less any attributable transaction costs and are subse-quently measured at amortized cost.
ProvisionsProvisions are recognized when – the Group has a present legal or constructive obligation as a result of past events
– it is probable that resources are needed to extinguish the obligation
– the amount of the obligation can be estimated in a reliable way.
A provision is recognized for expected warranty claims on products sold during the last two years, based on past experi-ence of the level of repairs and returns.
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50 Cicor | Financial Report 2015 | Consolidated Financial Statements
Government grantsGovernment grants are recognized as income over the periods matching the related costs, which they are intended to com-pensate on a systematic basis. Government grants are only recognized when there is reasonable assurance that the com-pany will comply with the conditions attached to them and that the grants will be received. Income taxesIncome tax is recognized in profit or loss except to the extent that it relates to items recognized directly in equity, in which case it is recognized in equity. Current income taxes are ac-crued based on taxable income of the current year. The tax rates and tax laws used to compute the amount are those that are enacted or substantially enacted at the reporting date. Deferred income tax assets and liabilities are recognized for all temporary differences between the tax and accounting bases of assets and liabilities at the reporting date using the liability method.
Deferred income taxes are measured at the tax rates that are expected to apply in the period when the asset is re-alized or the liability is settled.
Deferred tax assets arising from tax loss carry-forwards and deductible temporary differences are capitalized only if it is probable that they can be used to be offset against future taxable profits.
Derivative financial instrumentsDerivative financial instruments are stated at fair value, and gains and losses are reported in the financial result.
Pension plansCicor maintains several pension plans for employees in Swit-zerland and Germany. A liability is recognised if a pension plan has an underfunding and there is an economic obligation for Cicor to pay additional contribution. The assessment of whether there is an obligation is made using the recognition criteria for provisions. For Swiss plans, the measurement of the liability is based on the financial statements of the pension plan prepared in accordance with FER 26, and for German plans, this is based on an actuarial calculation. An asset arising from an economic benefit relating to an overfunding is not recognized. Employer contribution reserves are always recognized as an asset.
Changes in the economic obligation, the employer con-tribution reserves and the contributions incurred for the period are recognized in Personnel costs in the income statement.
Earnings per shareBasic earnings per share are calculated by dividing net profit excluding non-controlling interests by the weighted average number of shares outstanding during the reporting period. Diluted earnings per share include all potentially dilutive effects.
Treasury sharesWhen share capital is repurchased, the amount of the con-sideration paid, which includes directly attributable costs, is recognized net of any tax effects as a deduction from capital reserves. Repurchased shares are classified as treasury shares and are presented as a deduction from total equity. When trea-sury shares are sold or reissued subsequently the resulting gain or loss on the transaction is recognized in capital reserves.
Share-based paymentsThe grant date fair value of options granted to employees is recognized as an employee expense, with a corresponding increase in equity, over the period that the employees become unconditionally entitled to the options. The amount recognized as an expense is adjusted to reflect the number of share options for which the related service and performance conditions are expected to be met such that the amount ultimately recognized is based on the number of options that are going to meet the related service and performance condition at the vesting date, if any.
Revenue recognitionRevenue from the sale of products comprises all revenues that are derived from sales of products to third parties after deduc-tion of price rebates and value-added tax. Revenues from the sale of products are recognized when the significant risks and rewards of ownership of the goods have passed to the buyer, usually on delivery of the products.
Revenues from engineering and consulting services are recognized in the accounting period in which the services are rendered.
Research and development costsResearch costs are expensed as incurred. An intangible asset arising from development expenditure on an individual project is recognized only when a future benefit is expected, costs can be measured reliably, the asset is controlled by the organization and the resources needed to complete the asset are/will be made available. Additionally, the Group has to demonstrate the technical feasibility, the availability of resources and its intention of completing the project so that it will be available for use or sale.
Capitalized development cost is measured at cost less accumulated amortization and accumulated impairment losses.
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Cicor | Financial Report 2015 | Consolidated Financial Statements 51
3. SCOPE OF CONSOLIDATION
in local currency 1 000 Currency 2015 Nominal share capital
Participation in %
2014 Nominal share capital
Participation in %
Cicorel SA, Boudry/Switzerland* CHF 8 000 100 8 000 100Engineering/Production/Sales/Distribution
Reinhardt Microtech AG, Wangs/Switzerland* CHF 1 800 100 1 800 100Engineering/Production/Sales/Distribution
Reinhardt Microtech GmbH, Ulm/Germany EUR 500 75 500 75Engineering/Production/Sales/Distribution
RHe Microsystems GmbH, Radeberg/Germany* EUR 216 100 216 100Engineering/Production/Sales/Distribution
Electronicparc Holding AG, Bronschhofen (Wil)/Switzerland* CHF 23 271 100 23 271 100Holding/Finance
Swisstronics Contract Manufacturing AG, Bronschhofen (Wil)/Switzerland
CHF 3 000 100 3 000 100
Engineering/Production/Sales/Distribution
Systronics SRL, Arad/Romania RON 5 145 100 5 145 100Production
Systel Italia SRL, Milano/Italy EUR 10 100 10 100Sales/Distribution
ESG Holding Pte Ltd., Singapore* SGD 1 896 100 1 896 100Holding/Finance
Cicor Asia Pte Ltd., Singapore SGD 1 000 100 1 000 100Sales/Distribution
Cicor Ecotool Pte Ltd., Singapore SGD 1 000 100 1 000 100Engineering/Production
PT Cicor Panatec, Batam/Indonesia USD 300 100 300 100Production
Brant Rock Enterprises Corporation, British Virgin Islands USD 10 100 10 100Holding/Finance
Cicor Anam Ltd., Anam/Vietnam USD 1 500 100 1 500 100Production
Suzhou Cicor Technology Co. Ltd., China CNY 34 798 100 23 507 100Production
Cicor Americas Inc., USA USD 10 100 10 100Sales/Distribution
Cicor Management AG, Zurich/Switzerland* CHF 250 100 250 100Management Services
* Directly held subsidiaries of Cicor Technologies Ltd.
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52 Cicor | Financial Report 2015 | Consolidated Financial Statements
4. SEGMENT REPORTING
2015 in CHF 1 000
AMS Division 2015
ES Division 2015 Total reportable segments
2015
Corporate and eliminations
2015
Consolidated 2015
Income statement
Sales to external customers 49 508 131 342 180 850 –238 180 612
Intersegment sales 2 236 238 –238 –
Segment result before depreciation and amortization (EBITDA) 642 8 930 9 572 –2 173 7 399
Segment result (EBIT) –4 440 5 136 696 –2 348 –1 652
Balance sheet 31.12.2015 31.12.2015 31.12.2015 31.12.2015 31.12.2015
Intangible segment assets 650 18 668 119 787
Other than intangible segment assets 59 577 82 228 141 805 8 722 150 527
Total assets 60 227 82 246 142 473 8 841 151 314
Segment liabilities 60 666 57 912 118 578 –29 964 91 614
Other segment information 2015 2015 2015 2015 2015
Depreciation and amortization 4 952 3 794 8 746 305 9 051
Capital expenditures for property, plant and equipment 4 059 4 394 8 453 – 8 453
2014 in CHF 1 000
AMS Division 2014
ES Division 2014 Total reportable segments
2014
Corporate and eliminations
2014
Consolidated 2014
Income statement
Sales to external customers 56 934 145 524 202 458 – 202 458
Intersegment sales – 138 138 –138 –
Segment result before depreciation and amortization (EBITDA) 7 594 13 912 21 506 –1 844 19 662
Segment result (EBIT) 2 283 10 025 12 308 –2 079 10 229
Balance sheet 31.12.2014 31.12.2014 31.12.2014 31.12.2014 31.12.2014
Intangible segment assets 838 63 901 165 1 066
Other than intangible segment assets 66 239 80 245 146 484 2 580 149 064
Total assets 67 077 80 308 147 385 2 745 150 130
Segment liabilities 60 391 55 909 116 300 –33 609 82 691
Other segment information 2014 2014 2014 2014 2014
Depreciation and amortization 5 311 3 887 9 198 235 9 433
Capital expenditures for property, plant and equipment 6 535 4 083 10 618 – 10 618
Cicor defines its reportable segments based on the internal reporting to its Board of Directors. They base their strategic and operational decisions on these monthly distributed reports, which include the aggregated financial data for the Group and for the Divisions. The two divisions, AMS and ES, have been identified as the two reportable segments. The AMS Division supplies printed circuit boards and thin/thick-film-coating technologies as well as a wide range of microelectronic man-ufacturing capabilities to different industries whereas the ES
Division provides electronic manufacturing services from prod-uct development to volume production and after-sales service.
For internal reporting, and therefore the segment reporting, the applied principles of accounting and valuation are the same as in the consolidated financial statements. Intersegment sales are recognized at arm’s length.
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Cicor | Financial Report 2015 | Consolidated Financial Statements 53
in CHF 1 000 2015 2014
Reconciliation of total reportable segment result
Total reportable segment result (EBIT) 696 12 308
Other corporate expenses –2 348 –2 079
Financial income 5 504 4 844
Financial expenses –7 663 –6 115
Consolidated profit before tax –3 811 8 958
Other corporate expenses contain stewardship costs and costs related to the listing at the Swiss Stock Exchange (SIX).
Entity-wide information
2015 in CHF 1 000
Switzerland 2015
Germany 2015
Other 2015
Total 2015
Sales to external customers (attributed to the entity's country of domicile) 98 576 15 803 66 233 180 612
31.12.2015 31.12.2015 31.12.2015 31.12.2015
Other non-current assets 20 474 11 307 14 047 45 828
2014 in CHF 1 000
Switzerland 2014
Germany 2014
Other 2014
Total 2014
Sales to external customers (attributed to the entity's country of domicile) 111 178 20 200 71 080 202 458
31.12.2014 31.12.2014 31.12.2014 31.12.2014
Other non-current assets 28 728 11 226 11 589 51 543
Other non-current assets contain property, plant and equipment and intangible assets.
in CHF 1 000 31.12.2015 % 31.12.2014 %
Sales by destination
Switzerland 72 097 39.9 79 425 39.2
Europe (without Switzerland) 63 155 35.0 73 204 36.2
Asia 31 658 17.5 35 008 17.3
North America 11 537 6.4 13 798 6.8
Other 2 165 1.2 1 023 0.5
Total 180 612 100.0 202 458 100.0
Sales by industry
Aerospace & defence 14 881 8.2 17 921 8.9
Communication 16 596 9.2 18 245 9.0
Industrial 54 100 30.0 54 953 27.1
Medical 48 473 26.8 56 663 28.0
Automotive & transport 16 332 9.0 22 980 11.4
Watches & consumer 22 117 12.2 23 252 11.5
Other 8 113 4.6 8 444 4.1
Total 180 612 100.0 202 458 100.0
Major customersCicor Group’s biggest customer contributes less than 8% (2014: less than 7%) to the Group’s consolidated sales. In 2015, about 45% (2014: about 43%) of total Group’s net sales can be attributed to the Group’s top ten clients.
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54 Cicor | Financial Report 2015 | Consolidated Financial Statements
5. PROPERTY, PLANT AND EQUIPMENT
2015 in CHF 1 000
Land and buildings
Machinery Furniture and equipment
Other equipment
Total
Acquisition costs
Balance at 1 January 2015 29 482 92 264 11 073 2 187 135 006
Additions 530 6 802 1 064 57 8 453
Disposals –9 –4 565 –26 –13 –4 613
Translation adjustment –684 –2 283 –428 –129 –3 524
Balance at 31 December 2015 29 319 92 218 11 683 2 102 135 322
Accumulated depreciation
Balance at 1 January 2015 –13 145 –62 203 –7 355 –1 826 –84 529
Depreciation –1 602 –5 869 –1 054 –177 –8 702
Impairment –134 –3 078 – – –3 212
Disposals 9 4 133 17 13 4 172
Translation adjustment 197 1 462 228 103 1 990
Balance at 31 December 2015 –14 675 –65 555 –8 164 –1 887 –90 281
Net book value
1 January 2015 16 337 30 061 3 718 361 50 477
31 December 2015 14 644 26 663 3 519 215 45 041
Thereof net book value of assets under financial lease – 980 – 47 1 027
Net book value of pledged assets 4 319
Addition of assets under financial lease –
In 2015, Cicor invested CHF 6.8 million in machinery in compa-nies in Switzerland, Germany, Romania and Asia. The biggest investments were undertaken in Romania where CHF 1.7 million was invested in new assembly machines (SMT SX line). In Germany, CHF 1.6 million was invested in a fully automated SMD- and Chip-Assemblyline. The remaining investment sum was spent on several minor investments in Switzerland and Asia.
The impairments are mainly due to the consolidation of the production sites of Cicorel SA (see Note 10).
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2014 in CHF 1 000
Land and buildings
Machinery Furniture and equipment
Other equipment
Total
Acquisition costs
Balance at 1 January 2014 28 336 87 963 9 931 1 940 128 170
Additions 1 070 8 049 1 345 154 10 618
Disposals –207 –4 388 –127 – –4 722
Reclassifications –28 28 –99 99 –
Translation adjustment 311 612 23 –6 940
Balance at 31 December 2014 29 482 92 264 11 073 2 187 135 006
Accumulated depreciation
Balance at 1 January 2014 –11 559 –60 344 –6 585 –1 483 –79 971
Depreciation –1 696 –5 877 –982 –233 –8 788
Disposals 207 4 247 89 – 4 543
Reclassifications – – 121 –121 –
Translation adjustment –97 –229 2 11 –313
Balance at 31 December 2014 –13 145 –62 203 –7 355 –1 826 –84 529
Net book value
1 January 2014 16 777 27 619 3 346 457 48 199
31 December 2014 16 337 30 061 3 718 361 50 477
Thereof net book value of assets under financial lease – 1 116 – – 1 116
Net book value of pledged assets 6 193
Addition of assets under financial lease –
In 2014, Cicor invested CHF 8.0 million in machinery at compa-nies in Switzerland, Germany, Romania and Asia. Of this, CHF 3.1 million was invested in one site in Switzerland to increase its leading position as manufacturer of high demanding printed circuit boards with ultra-fine lines. Investments included a state-of-the-art laser direct imaging (LDI) system, delivering the highest imaging accuracy and yields for today’s most com-plex IC substrate applications including Flip-Chip BGA, Flip-Chip CSP, BGA/CSP and modules manufacturing.
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56 Cicor | Financial Report 2015 | Consolidated Financial Statements
6. INTANGIBLE ASSETS
2015 in CHF 1 000
Goodwill Brand Technology Clients Other Total
Acquisition costs
Balance at 1 January 2015 96 188 6 711 7 743 3 617 1 264 115 523
Additions – – 23 – 130 153
Translation adjustment – – –351 –441 1 –791
Balance at 31 December 2015 96 188 6 711 7 415 3 176 1 395 114 885
Accumulated depreciation
Balance at 1 January 2015 –96 109 –6 711 –6 937 –3 617 –1 083 –114 457
Amortization –79 – –120 – –150 –349
Translation adjustment – – 268 441 –1 708
Balance at 31 December 2015 –96 188 –6 711 –6 789 –3 176 –1 234 –114 098
Net book value
1 January 2015 79 – 806 – 181 1 066
31 December 2015 – – 626 – 161 787
2014 in CHF 1 000
Goodwill Brand Technology Clients Other Total
Acquisition costs
Balance at 1 January 2014 95 922 6 711 7 640 3 626 1 248 115 147
Additions – – 151 – 3 154
Translation adjustment 266 – –48 –9 13 222
Balance at 31 December 2014 96 188 6 711 7 743 3 617 1 264 115 523
Accumulated depreciation
Balance at 1 January 2014 –95 688 –6 711 –6 625 –3 626 –930 –113 580
Amortization –157 – –344 – –144 –645
Reclassification – – – – – –
Translation adjustment –264 – 32 9 –9 –232
Balance at 31 December 2014 –96 109 –6 711 –6 937 –3 617 –1 083 –114 457
Net book value
1 January 2014 234 – 1 015 – 318 1 567
31 December 2014 79 – 806 – 181 1 066
7. INVENTORIES
in CHF 1 000 31.12.2015 31.12.2014
Net value of raw materials 21 110 21 783
Net value of work-in-progress 11 764 13 197
Net value of finished goods 8 585 7 147
Total inventories 41 459 42 127
Change in inventory allowance (+ increase / – decrease) 740 –127
The main reasons for the increase in inventory allowance are the impairment due to the restructuring in Moudon (TCHF 250, see Note 10) and an increase in an individual allowance related to one specific customer (TCHF 400).
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Cicor | Financial Report 2015 | Consolidated Financial Statements 57
8. TRADE ACCOUNTS RECEIVABLE AND OTHER ACCOUNTS RECEIVABLE
in CHF 1 000 31.12.2015 31.12.2014
Trade accounts receivable 28 002 31 157
Allowance for bad debts –211 –288
Total trade accounts receivable 27 791 30 869
Ageing of trade accounts receivable
in CHF 1 000 31.12.2015 Gross
31.12.2015 Allowance
31.12.2014 Gross
31.12.2014 Allowance
Not yet due 21 833 –140 24 465 –
Overdue 0–45 days 4 903 –27 5 048 –5
Overdue 46–90 days 676 –19 1 076 –61
Overdue 91–180 days 91 –3 384 –88
Overdue 181–360 days 177 –5 149 –99
Overdue more than 360 days 322 –17 35 –35
Total trade accounts receivable 28 002 –211 31 157 –288
Movement in the allowance for impairment for trade accounts receivable
in CHF 1 000 2015 2014
Individual impairment allowance
Balance as of 1 January 288 419
Allowance increase 72 28
Utilization/consumption –2 –75
Reversal of allowance –152 –84
Translation adjustments –2 –
Balance as of 31 December 204 288
Collective impairment allowance
Balance as of 1 January – –
Change in allowance 7 –
Balance as of 31 December 7 –
Other accounts receivable
in CHF 1 000 31.12.2015 31.12.2014
Receivables on bullion dealers’ accounts 746 526
Value added taxes 423 1 357
Withholding taxes – 5
Other 2 516 2 095
Total other accounts receivable 3 685 3 983
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58 Cicor | Financial Report 2015 | Consolidated Financial Statements
9. CASH AND CASH EQUIVALENTS
in CHF 1 000 31.12.2015 31.12.2014
Bank accounts 27 681 17 006
Total cash and cash equivalents 27 681 17 006
Cicor Technologies’ banking partners are first-rate Swiss, Ger-man, English and Romanian banks. Cash earns interests at floating rates of 0.00% (CHF); 0.00% (EUR); and 0.05% (USD).
10. PROVISIONS
2015 in CHF 1 000 Restructuring Warranties Other Total provisions Deferred taxes Total provisions and deferred
taxes
Balance at 1 January 2015 – 2 137 1 858 3 995 1 219 5 214
Additional provisions 1 217 1 454 1 284 3 955 110 4 065
Unused amounts reversed – –715 –244 –959 – –959
Amount used –16 –2 –629 –647 –427 –1 074
Translation adjustments – –91 –100 –191 – –191
Balance at 31 December 2015 1 201 2 783 2 169 6 153 902 7 055
thereof short-term provisions 1 201 1 068 1 009 3 278
thereof long-term provisions – 1 715 1 160 2 875
2014 in CHF 1 000 Restructuring Warranties Other Total provisions Deferred taxes Total provisions and deferred
taxes
Balance at 1 January 2014 – 2 140 2 160 4 300 1 599 5 899
Additional provisions – 1 578 807 2 385 17 2 402
Unused amounts reversed – –1 226 –153 –1 379 – –1 379
Amount used – –336 –981 –1 317 –396 –1 713
Translation adjustments – –19 25 6 –1 5
Balance at 31 December 2014 – 2 137 1 858 3 995 1 219 5 214
thereof short-term provisions – 811 1 168 1 979
thereof long-term provisions – 1 326 690 2 016
Warranty provisions are recognized for warranty claims on products sold. The additional provisions in 2015 were based on several smaller cases.
As per 31 December, other provisions consist mainly of jubilee benefits (2015: TCHF 781; 2014: TCHF 752) and rebuilding costs (2015: TCHF 356; 2014: TCHF 377). The increase compared to last year is mainly due to rent obligations in connection with the move to the new building in Bronschhofen (TCHF 320) and an imminent loss for an order on hand concerning a single fixed price project customer (TCHF 125).
The restructuring costs as shown in the income state-ment 2015 of TCHF 4 718 include impairments on fixed assets (TCHF 3 212) and valuation adjustments on inventory (TCHF 250), termination based benefits (TCHF 504) and other costs (TCHF 752). The costs recognized as provisions at year-end are TCHF 1 201. These restructuring costs are due to the fact that Cicor Group has decided to merge the AMS Division’s two PCB production locations in Switzerland. This move will involve consolidating the Cicorel SA location in Moudon with the loca-tion in Boudry. Cicor Group has also decided to merge the ES
Division’s customer support operation in Switzerland from its previous two locations into one joint location. As part of this measure, the Ticino sales office in Quartino will relocate to the ES Division’s headquarters in Bronschhofen and have its exist-ing competencies integrated there.
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Cicor | Financial Report 2015 | Consolidated Financial Statements 59
11. TAXES
Major components of tax expense in CHF 1 000 2015 2014
Current income taxes 1 099 1 566
Income tax for prior years –183 –91
Deferred tax –671 477
Total tax expense 245 1 952
Deferred tax assets and liabilities
in CHF 1 000 31.12.2015 Assets
31.12.2015 Liabilities
31.12.2014 Assets
31.12.2014 Liabilities
Deferred taxes on intangible assets – 157 4 241
Deferred taxes on property, plant and equipment 134 301 150 495
Deferred taxes on other assets 516 451 778 1 012
Deferred taxes on liabilities 544 179 976 682
Total 1 194 1 088 1 908 2 430
Deferred taxes on loss carried forward 3 074 – 2 875 –
Offset of assets and liabilities –186 –186 –1 211 –1 211
Total deferred tax assets and liabilities 4 082 902 3 572 1 219
Balance at 1 January 3 572 1 219 4 429 1 599
Change of temporary differences recognized in the income statement 310 –317 209 –380
Change in tax loss carried forward 200 –1 066 –
Balance at 31 December 4 082 902 3 572 1 219
The Group average tax rate for the calculation of the deferred income taxes is 16.5%.
Reconciliation of current income taxes and deferred taxes
in CHF 1 000 2015 2014
Loss/profit before tax –3 811 8 958
Weighted average income tax in % 9.2 % 21.0 %
Expected income tax expense/(income) –352 1 878
Current year losses for which no deferred tax asset is recognized 934 399
Recognition of tax assets on previously unrecognized tax losses –802 –71
Effects of change in losses carried forward 602 –
Effect of tax rate changes compared to prior period – 8
Effect of non-deductible expenses 13 –
Effect of tax-exempt income – –178
Adjustments for current tax of prior periods –183 –91
Other adjustments 34 7
Effective income taxes 246 1 952
Effective income taxes in % of profit/(loss) before tax –6.5 % 21.8 %
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60 Cicor | Financial Report 2015 | Consolidated Financial Statements
Tax loss carried forward for which no deferred tax assets have been capitalized in CHF 1 000 31.12.2015 31.12.2014
tax loss carried forward expiring within 1 year 4 231 –
tax loss carried forward expiring in 1 year 515 –
tax loss carried forward expiring in 2 years 1 398 4 951
tax loss carried forward expiring in 3 years 1 305 1 385
tax loss carried forward expiring in 4 or more years 7 893 2 939
Since the group operates in various tax jurisdictions, its average expected tax rate is calculated as a weighted average of the tax rates in these jurisdictions. This rate changes from year to year due to changes in the mix of the group’s taxable income and changes in local tax rates.
Tax losses carried forward are capitalized where the possibility of using them is high. In 2015, an additional deferred tax asset of TCHF 802 has been capitalized.
12. FINANCIAL LIABILITIES
Long-term financial liabilities
in CHF 1 000 31.12.2015 31.12.2014
Financial leases – 97
Borrowings, long-term 43 668 32 683
Total long-term financial liabilities 43 668 32 780
Short-term financial liabilities
in CHF 1 000 31.12.2015 31.12.2014
Bank overdrafts 2 016 2 601
Bank borrowings, short-term 1 945 2 104
Short-term portion of long-term borrowings 484 352
Financial leases 102 402
Total short-term financial liabilities 4 547 5 459
Maturity of financial liabilities
in CHF 1 000 31.12.2015 31.12.2014
Within 1 year 4 547 5 459
Within 2 to 5 years 43 668 32 780
Over 5 years – –
Total financial debts 48 215 38 239
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Repayments of financial liabilities
2015 Interest rate 2016 2017 2018 2019 2020 2021 and after
CHF 65.0 million revolving credit line 1.9 % – 42 476 – – – –
EUR 3.0 million revolving credit line 1.6 % 2 016 – – – – –
EUR 3.4 million revolving credit line 1.7 % 2 429 420 353 299 120 –
Leasing n.a. 102 – – – – –
Total 4 547 42 896 353 299 120 –
2014 Interest rate 2015 2016 2017 2018 2019 2020 and after
CHF 45.0 million revolving credit line 1.8 % – – 32 000 – – –
EUR 1.25 million loan 2.5 % 842 – – – – –
EUR 2.0 million loan 2.3 % 1 759 – – – – –
EUR 2.71 million revolving credit lines 2.6 % 2 456 281 207 128 67 –
Leasing n.a. 402 97 – – – –
Total 5 459 378 32 207 128 67 –
On 22 December 2014, the Group signed a syndicated bank loan agreement on a total line of CHF 65 million plus an allowance of an external basket of CHF 10 million valid for three years, beginning on 19 January 2015, with two extension options of one additional year each, therefore running for a maximum term of five years.
The covenants are net debt/EBITDA ratio of a maximum of 2.5 times and a minimum equity ratio of 35% (previous year under IFRS 45%). EBITDA is calculated before restructuring costs, possible acquisitions can be added pro forma. The interest bases on LIBOR added by a margin variable depending on the net debt/EBITDA ratio. The bank covenants were fulfilled at all times.
The current CHF 65 million revolving credit line, which was divided into CHF 60 million cash and CHF 5 million for guarantees, was utilized by CHF 43 million cash at a variable interest rate of 1.85% on average and for guarantees of CHF 0.6 million bearing commission charges of 0.7%.
In addition to the syndicated loan, the Group has revolving loans of EUR 6.4 million utilized with EUR 5.2 million at an average variable interest rate of 1.3%.
Collateral assets of CHF 4.3 million were pledged. The shares of the following companies at a nominal value of CHF 36.3 million (2014: CHF 36.1 million) are in deposit with the lead bank pledged as collateral for the syndicated credit line: Cicorel SA, Electronicparc Holding AG, Swisstronics Contract Manu facturing AG, Reinhardt Microtech AG and RHe Microsystems GmbH.
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62 Cicor | Financial Report 2015 | Consolidated Financial Statements
13. LIABILITIES FOR POST-EMPLOYMENT BENEFITS
Cicor maintains several pension plans for employees in Switzerland and Germany. Pension expenses totaled TCHF 2 212 (2014: TCHF 2 026). German pension funds are not legally independent in contrast to Swiss pension funds. Companies therefore need to recognize a provision according to the German Commercial Code. RHe Microtech GmbH and Reinhardt Microtech GmbH did so by recognizing TCHF 893 resp. TCHF 759 as liability.
The majority of Cicor‘s insured employees are covered for the risk of old age, death and disability within two collective pension schemes which are administrating pension plans of various unrelated employers. Plan A is an independent pension fund whereas Plan B has been established by an insurance company.
Plan A:The standard retirement age for Plan A is 65. Employees qualify for early retirement on their 58th birthday at the earliest. Furthermore, the employees may choose to take their entire pension or part thereof in the form of capital payment. For retirements at the age of 65, the conversion rate is 6.8%. This rate is relevant to determine the pension payment in relation to the accumulated savings. These savings result from employee and employer contributions which are paid into the individual savings account of each individual insured person as well as the interest accruing on the accumulated savings.
Plan A has reinsured its exposure to the risks of death and disability. It is a collective multiemployer pension fund organized as a foundation under Swiss law. The most senior governing body of the foundation is the Board of Trustees that consists of an equal number of employer’s and employees’ representatives. The people entrusted with the management of the pension fund and its assets are subject to the charter of the Swiss Pension Fund Association ASIP. All processes are audited by the internal auditors and the independent external auditors
as well as the investment controller. And finally, the supervisory authority, the Zentralschweizer BVG und Stiftungsaufsicht (ZBSA), audits the management of the pension fund and the assets in collaboration with the auditors. The actual funding ratio as per 31.12.2015 is 104.3%. Whenever there is a legal obligation to cover an underfunding this has to be remedied by various measures such as increasing employee and employer contributions, lowering the interest rate on retirement account balances, reducing prospective benefits and a suspension of the early withdrawal facility.
Plan B:The standard retirement age for Plan B is 65. Employees qualify for early retirement on their 58th birthday at the earliest. Furthermore, the employees may choose to take their entire pension or part thereof in the form of capital payment. For retirements at the age of 65, the conversion rate is 6.8% for the compulsory part and between 5.24% and 5.60% for the supplementary part. The accumulated savings result from employee and employer contributions which are paid into the individual savings account of each individually insured person as well as the interest accruing on the accumulated savings. The final benefit is contributionbased with certain minimum guarantees. Plan B is legally organized as a foundation under Swiss law and has all risks reinsured under an insurance contract. The most senior governing body of the foundations is the Board of Trustees that consists of an equal number of employer’s and employees’ representatives . The reinsurance contract covers the risks of death and disability as well as the investment risk, the legally required minimum interest rate and the lifelong payment of current oldage and survivors‘ pensions, regardless of financial market performance.
The Group does not have employer contribution reserves.
in CHF 1 000 Surplus/deficit
Economical part of the organization
Change to prior year period or
recognized in the current result of the period,
respectively
Contribu-tions
concerning the
business period
Pension benefit expenses with personnel expenses
31.12.2015 31.12.2015 31.12.2014 2015 2014
Pension institutions without surplus/deficit (Plan A) – – – – 1 443 1 443 1 090
Pension institutions with surplus (Plan B) 1) – – – – 597 597 865
Pension institutions without own assets – 1 652 1 306 346 –174 172 71
Total – 1 652 1 306 346 1 866 2 212 2 026
1) The surplus of the collective pension fund attributable to Cicor cannot be determined.
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Cicor | Financial Report 2015 | Consolidated Financial Statements 63
14. OTHER CURRENT LIABILITIES AND ACCRUALS
in CHF 1 000 31.12.2015 31.12.2014
Value-added taxes 250 134
Other current liabilities 1 086 2 038
Other accounts payable 5 178 4 740
Total other currenct liabilities 6 514 6 912
Accrued interest 398 –
Accrued personnel expenses 2 524 2 957
Other accrued expenses 3 311 4 053
Total accruals 6 233 7 010
Total other current liabilities and accruals 12 747 13 922
Other current liabilities and accrued expenses are noninterestbearing financial liabilities.
Other accounts payable also contain payables for social security.
15. LEASE COMMITMENTS
Operating leasing
in CHF 1 000 31.12.2015 31.12.2014
within 1 year 3 199 3 029
from over 1 year to under 5 years 7 193 4 426
due in 5 years or later 19 083 2 723
Total operating leasing 29 475 10 178
Operating leasing commitments stem mostly from mid to longterm lease obligations for production and office premises. The leases have varying terms and renewal rights. Other operational leasings are for leasingfinanced cars.
For financial leasings, please refer to note 12.
16. CONTINGENT LIABILITIESThere are no contingent liabilities for Cicor Group companies as at 31 December 2015. For contingent liabilities of Cicor Technologies Ltd. refer to the notes of the financial statements (Holding) on page 78.
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64 Cicor | Financial Report 2015 | Consolidated Financial Statements
17. ISSUED CAPITAL
Capital structure
in CHF 1 000
Share capital at 1 January 2014 28 806
Increase of ordinary share capital of 11 584 registered shares at CHF 10 116
Share capital at 31 December 2014 28 922
Increase of ordinary share capital of 10 000 registered shares at CHF 10 100
Share capital at 31 December 2015 29 022
2 902 092 registered shares of CHF 10
Ordinary share capitalThe ordinary share capital was increased in 2015 by 10 000 shares (2014: 11 584 shares) out of conditional capital at a nominal value of CHF 10 for the established stock option plans.
Cicor Technologies Ltd. is a holding company established under Swiss law. According to the provisions of law governing the appropriation of retained earnings by holding companies, the share capital and appropriations to the general legal reserve to the extent of 20% of share capital as well as the reserve for treasury shares may not be distributed.
DividendAny dividend distribution must be proposed by the Board of Directors and approved by the Annual Shareholder’s Meeting. At the Shareholders’ Meeting of 23 April 2015, the shareholders decided to allocate TCHF 1 041 from the capital contributions to the free reserves and to distribute CHF 0.36 per share (totaling CHF 1 040 613.12) to the shareholders out of these free reserves. Due to the results in the 2015 financial year, the Board of Directors will propose to the Annual Sharholders’ meeting to forego the distribution of earnings.
Authorized capitalAt the Shareholders’ Meeting at 24 April 2014, the shareholders decided to renew the authorization of the Board of Directors to increase the share capital by a maximum of 600 000 fully paidin shares at a nominal value of CHF 10 until 24 April 2016.
Conditional capitalAt the Shareholders’ Meeting of 13 May 2009, the shareholders decided to increase the conditional share capital up to 200 000 fully paidin registered shares with a total nominal value up to CHF 2 000 000 for the exercise of stock option rights granted to officers and other key employees under an employee stock option plan established by the Board of Directors. During 2015, 10 000 (2014: 11 584) shares were issued.
As of 31 December 2015, according to the stock optionplans approved by the Board of Directors on 3 January
2008, 3 January 2009 and 26 November 2009, 21 793 options (previous year 35 793) were outstanding.
At the Shareholders’ Meeting of 13 May 2009, the shareholders decided to create additional conditional share capital of up to 500 000 fully paidin registered shares with a total nominal value of up to CHF 5 000 000 for the exercise of conversion rights granted to holders of convertible debt securities to be issued by the company. Such conversion rights would have to be exercised within five years of the issuance of such convertible debt securities.
18. TREASURY SHARES
Number of shares
in CHF 1 000
Balance as per 1 January 2014 1 500 37
Transactions of own shares – –
Balance as per 31 December 2014 1 500 37
Transactions of own shares – –
Balance as per 31 December 2015 1 500 37
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19. EARNINGS PER SHAREBasic earnings per share are calculated by dividing the net profit attributable to shareholders by the weighted average number of ordinary shares outstanding during the year.
Basic earnings per share
2015 2014
Net profit attributable to Cicor shareholders in CHF 1 000 –3 982 6 896
Weighted average number of ordinary shares outstanding 2 896 914 2 888 571
Basic earnings per share in CHF –1.37 2.39
Diluted earnings per share
2015 2014
Weighted average number of shares outstanding (basic) 2 896 914 2 888 571
Adjustment for share options 1 282 6 224
Weighted average number of shares outstanding (diluted) 2 898 196 2 894 795
Profit applicable for calculation of earnings per share (basic and diluted) in CHF 1 000 –3 982 6 896
Diluted earnings per share in CHF –1.37 2.38
20. SHARE-BASED PAYMENTSCicor Technologies Ltd. has issued options under three stock option plans during the financial years 2008 and 2009. Since then, no additional stock option plans have been issued. Plan 1 has expired on 3 January 2015.
AssessmentThe prices of the call options issued to executive directors and management on 3 January 2008, 3 January 2009 and 26 November 2009 were calculated according to a trinomial model using the following parameters:
Plan 1 Plan 2 Plan 3
Share price on 3 January 2008/2009 and 26 November 2009 CHF 73.70 CHF 26 CHF 30
Exercise price CHF 78 CHF 32 CHF 28.80
Expected volatility 28 % 40 % 45 %
Life of the option 3 January 2015 3 January 2016 26 November 2016
Risk-free interest rate 2.97 % 2.44 % 1.88 %
Vesting period three years three years two years
Option type American American American
The weighted average share price for 2015 was CHF 30.57 (2014: 35.61). There were no option expenses recognized during the financial years 2015 and 2014.
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66 Cicor | Financial Report 2015 | Consolidated Financial Statements
Option holdingsThe following table shows the option holdings of executive directors and the members of the executive and senior management as of 31 December:
2015
Plan 1 Plan 2 Plan 3
Outstanding options per 1 January 2015 4 000 2 668 29 125
Exercised – – –10 000
Expired –4 000 – –
Outstanding options per 31 December 2015 – 2 668 19 125
Thereof exercisable – 2 668 19 125
These potential ordinary shares from Plan 2 and Plan 3 are dilutive. For the dilution effect on earnings per share, please refer to note 19.
2014
Plan 1 Plan 2 Plan 3
Outstanding options per 1 January 2014 6 000 3 002 40 375
Exercised – –334 –11 250
Expired –2 000 – –
Outstanding options per 31 December 2014 4 000 2 668 29 125
Thereof exercisable 4 000 2 668 29 125
21. PERSONNEL COSTS
in CHF 1 000 2015 2014
Wages and salaries 46 646 48 427
Social security costs 7 653 7 416
Other personnel costs 2 590 2 977
Total 56 889 58 820
22. EMPLOYEES
2015 2014
Number of employees (FTE)
Production 1 786 1 673
Marketing and sales 64 70
Administration 108 109
Total 1 958 1 852
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Cicor | Financial Report 2015 | Consolidated Financial Statements 67
23. OTHER OPERATING EXPENSES
in CHF 1 000 2015 2014
Facility costs 8 006 8 283
Maintenance costs 3 389 4 076
Other production costs 4 626 5 276
Sales and marketing costs 1 557 1 808
Administration costs 5 748 4 729
Total 23 326 24 172
24. FINANCIAL INCOME AND EXPENSE
in CHF 1 000 2015 2014
Income
Interest income 57 178
Foreign exchange gains 5 447 4 666
Total 5 504 4 844
Expense
Interest expense 1 767 1 775
Foreign exchange losses 5 896 4 340
Total 7 663 6 115
The increase in net foreign exchange losses of TCHF 775 is mainly due to the change in unrealized exchange losses of TCHF 571. The reason for this increase in expenses is the fact that the Swiss National Bank decided to discontinue the minimum exchange rate of CHF 1.20 per euro as of 15 January 2015.
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68 Cicor | Financial Report 2015 | Consolidated Financial Statements
25. RELATED PARTIES DISCLOSURESThe consolidated financial statements include the financial statements of Cicor Technologies Ltd., Boudry, and the subsidiaries listed in note 3.
The governing and supervisory bodies of Cicor Technologies Ltd. are the only other related parties.
As per 31 December 2015, HEB Swiss Investment AG, the main shareholder, holds 29.25% of total shares outstanding. Other principal shareholders are presented in the notes of the financial statements of Cicor Technologies Ltd.
On 17 September 2015, Swisstronics Contract Manufacturing AG sold the property in Bronschhofen, newly acquired in 2015 from a third party, to HEB Swiss Investment AG at the original purchase price of TCHF 2 930 (payment date 18 September 2015). Additionally, HEB Swiss Investments AG compensated Swisstronics Contract Manufacturing AG for investments already undertaken in the amount of TCHF 1 265 (payment date 1 December 2015) in connection with the building of a new production plant.
Compensation of key management personnel of the GroupThe remuneration of the Board of Directors and the Management also include the remuneration recorded at subsidiaries. Detailed information concerning compensation is published within the remuneration report on pages 36–37.
26. RISK MANAGEMENTRisk management is a fundamental element of Cicor’s business practice at all levels and encompasses different types of risks. It has been integrated into the controlling and reporting process according to the regulation in the Swiss Code of Obligation Art. 663b/12. Material risks are identified and quantified in workshops and discussed with the executive management and the Board of Directors. The risk management process will be repeated regularly, at least once a year.
27. FINANCIAL RISK MANAGEMENTThe Group has exposure to the following risks from its use of financial instruments: – Credit risk – Market risk – Liquidity risk
This note presents information about the Group’s exposure to each of the above risks. Further quantitative disclosures are included throughout these consolidated statements. The Board of Directors has overall responsibility for the establishment and oversight of the Group’s risk management framework. The following paragraphs give an overview of the extent of the above mentioned risks.
Credit riskThe credit risk is the risk of financial loss to the Group if a customer or counterparty to financial instruments fails to meet its contractual obligation. The assets mainly exposing the Group to a credit risk are: cash, cash equivalents and trade accounts receivable. The Group minimizes credit risk arising on cash and cash equivalents by investing in funds of high credit rated banks. These investments generally have a maturity of less than three months.
The Group’s exposure to credit risk arising from trade receivables is influenced mainly by the individual characteristics of each customer. The demographics of the Group’s customer base, including the default risk of the industry and country in which customers operate, has less of an influence on credit risk. The danger of risk concentration is generally minimized by the large number of customer credit balances, as no single customer accounts for more than 8% of consolidated sales 2015 (2014: no single customer accounted for more than 7% of consolidated sales).
The carrying value of financial assets reflects the maximum credit risk and is presented in the table below:
in CHF 1000 2015 2014
Cash and cash equivalents 27 681 17 006
Trade receivables 27 791 30 869
Other accounts receivable 1 791 1 959
Other currrent assets 489 114
Total 57 752 49 948
Every operational unit has a credit policy under which each new customer is analyzed individually for creditworthiness. Purchase limits are established for each customer which represent the maximum open amount possible. Customer lists are reviewed in a monthly meeting with the Group management. On a quarterly basis the allowances made according to the Group’s rules laid down in the financial manual are closely monitored.
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Cicor | Financial Report 2015 | Consolidated Financial Statements 69
Market riskThe market risk is the risk that changes in market prices, such as foreign exchange rates, interest rates and equity prices will affect the Group’s income or the value of its holdings of fi nancial instruments. The objective of risk management is to manage and control market risk exposures within acceptable limits. Cicor does not hold any financial instruments carried at fair value, but classifies all financial assets and liabilities as loans and receivables respectively as liabilities at amortized costs.
Currency riskThe Cicor Technologies Group is exposed to currency risk on sales and purchases that are denominated in a currency other than the respective currencies of Group entities. The currencies in which these transactions are primarily denominated are Swiss francs (CHF), euros (EUR), Singapore dollars (SGD) and US dollars (USD). These risks are mostly offset by cash flows from financial assets or liabilities resulting from opposite operational transactions (natural hedge). Consequently, these risks are at present not hedged by currency forwards or derivative instruments. Currency translation effects arising from yearend valuations are also not hedged.
Interest rate riskThe interest rate risk is the risk that there is a change in market value or future cash flow of a financial instrument if there is a change in interest rate.
The Group’s exposure to market risk for changes in interest rates relates primarily to the Group’s interest bearing financial debts. The Group’s policy is to manage its interest cost using a mix of fixed and variable debt. For an amount of CHF 43 million, the interest rate was reduced in 2015 from an average of 2.2% to an average of 1.9%. At the reporting date the interest rate profile of the Group’s interestbearing financial instruments is presented in note 12.
Liquidity riskThe liquidity risk is the risk that Cicor Technologies Ltd. cannot meet its financial obligations when they are due.
A syndicated loan of CHF 65 million (utilized as per 31 December 2015: CHF 43 million) is available to secure short to longterm financing requirements (see note 12). Compliance with the financial covenants defined in the syndicated loan is a central element of the Group’s financial risk management. The bank covenants were fulfilled at all times. The shortterm liquidity risk is reduced by the cash flow generated by operations, the trend of which is monitored continuously.
The following table shows the contractual cash flows of financial liabilities including interest payments as of 31 December:
2015 in CHF 1 000 Carrying amount
Contractual cash flow
2016 contractual
cash flow
2017 contractual
cash flow
2018 contractual
cash flow
2019 contractual
cash flow
2020 and after contractual
cash flow
Financial liabilities 47 691 50 825 5 408 1 234 43 762 304 117
Trade payables 21 831 21 831 21 831 – – – –
Other current liabilities and accruals 12 139 12 139 12 139 – – – –
Total 81 661 84 795 39 378 1 234 43 762 304 117
2014 in CHF 1 000 Carrying amount
Contractual cash flow
2015 contractual
cash flow
2016 contractual
cash flow
2017 contractual
cash flow
2018 contractual
cash flow
2019 and after contractual
cash flow
Financial liabilities 38 239 40 509 6 166 992 33 150 133 68
Trade payables 23 658 23 658 23 658 – – – –
Other current liabilities and accruals 13 921 13 922 13 922 – – – –
Total 75 818 78 089 43 746 992 33 150 133 68
The net carrying amount of financial assets and liabilities is a reasonable approximation of the fair value. No significant deviations between the net carrying amount and the fair value were noted.
Financial liability is measured using the effective interest method. The effective interest method is a method of calculating the amortized cost of a financial liability and allocating the interest expense over the relevant period.
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70 Cicor | Financial Report 2015 | Consolidated Financial Statements
28. RESEARCH AND DEVELOPMENTCicor Group does not have any costs for research activities, but on average spends about 7% to 8% of sales as development costs.
29. SUBSEQUENT EVENTSNo events took place between 31 December 2015 and 8 March 2016 that would require an adjustment to the amounts recognized in these consolidated financial statements.
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Cicor | Financial Report 2015 | Consolidated Financial Statements 71
REPORT OF THE STATUTORY AUDITOR ON THE CONSOLIDATED FINANCIAL STATEMENTS TO THE GENERAL MEETING OF SHAREHOLDERSREPORT OF THE STATUTORY AUDITOR ON THE CONSOLIDATED FINANCIAL STATEMENTSAs statutory auditor, we have audited the consolidated financial statements of Cicor Technologies Ltd., Boudry, which comprise balance sheet, income statement, cash flow statement, statement of changes in equity and notes on pages 42 to 70 for the year ended 31 December 2015.
Board of Directors’ responsibilityThe board of directors is responsible for the preparation of the consolidated financial statements in accordance with Swiss GAAP FER and the requirements of Swiss law. This responsibility includes designing, implementing and maintaining an internal control system relevant to the preparation of consolidated financial statements that are free from material misstatement, whether due to fraud or error. The board of directors is further responsible for selecting and applying appropriate accounting policies and making accounting estimates that are reasonable in the circumstances.
Auditor’s responsibilityOur responsibility is to express an opinion on these consolidated financial statements based on our audit. We conducted our audit in accordance with Swiss law and Swiss Auditing Standards as well as International Standards on Auditing. Those standards require that we plan and perform the audit to obtain reasonable assurance whether the consolidated financial statements are free from material misstatement.
An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the consolidated financial statements. The procedures selected depend on the auditor’s judgment, including the assessment of the risks of material misstatement of the consolidated financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers the internal control system relevant to the entity’s preparation and fair presentation of the consolidated financial statements in order to design audit procedures that are appropriate in the circumstances, but not for the pur
pose of expressing an opinion on the effectiveness of the entity’s internal control system. An audit also includes evaluating the appropriateness of the accounting policies used and the reasonableness of accounting estimates made, as well as evaluating the overall presentation of the consolidated financial statements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion.
OpinionIn our opinion, the consolidated financial statements for the year ended 31 December 2015 give a true and fair view of the financial position, the results of operations and the cash flows in accordance with Swiss GAAP FER and comply with Swiss law.
REPORT ON OTHER LEGAL REQUIREMENTSWe confirm that we meet the legal requirements on licensing according to the Auditor Oversight Act (AOA) and independence (article 728 CO and article 11 AOA) and that there are no circumstances incompatible with our independence.
In accordance with article 728a paragraph 1 item 3 CO and Swiss Auditing Standard 890, we confirm that an internal control system exists, which has been designed for the preparation of consolidated financial statements according to the instructions of the board of directors.
We recommend that the consolidated financial statements submitted to you be approved.
Zurich, 8 March 2016KPMG AG
Roman Wenk Simon WidmerLicensed Audit Expert Licensed Audit ExpertAuditor in Charge
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72 Cicor | Financial Report 2015 | Financial Statements (Holding)
FINANCIAL STATEMENTS OF CICOR TECHNOLOGIES LTD.BALANCE SHEET
in CHF 1 000 31.12.2015 31.12.2014
Assets
Cash and cash equivalents 18 926 9 032
Other current receivables
– third party 44 21
– Subsidiaries 1 958 1 141
Accruals 607 92
Current assets 21 535 10 286
Long-term loans to Subsidiaries 49 795 45 885
Long-term loans to Subsidiaries subordinated 18 000 18 000
Investments 83 236 121 236
Non-current assets 151 031 185 121
Total assets 172 566 195 407
Liabilities and shareholders’ equity
Financial liabilities
– Subsidiaries 9 645 5 236
Other liabilities 13 85
Accrued expenses 2 211 1 783
Current liabilities 11 869 7 104
Non-current interest bearing liabilities
– third parties 43 000 32 000
Non-current liabilities 43 000 32 000
Ordinary share capital 29 021 28 921
Legal capital reserve
– General reserve 1 467 1 467
– Capital contribution reserves 108 171 109 211
– Share premium 1 239 1 051
Voluntary retained earnings
– Gain brought forward 15 706 12 748
– Net profit of the year –37 869 2 958
Treasury shares –38 –53
Shareholders’ equity 117 697 156 303
Total liabilities and shareholders’ equity 172 566 195 407
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Cicor | Financial Report 2015 | Financial Statements (Holding) 73
INCOME STATEMENT
in CHF 1 000 2015 2014
Income
Financial income 3 747 4 664
Interest received from Group companies 1 373 1 365
Interest received from third party 41 161
Other income – 68
Total income 5 161 6 258
Expenses
Financial expense 2 591 1 409
Administrative expense 2 437 1 886
Impairment 38 000 –
Tax 2 6
Total expenses 43 030 3 301
Net profit of the year –37 869 2 957
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74 Cicor | Financial Report 2015 | Financial Statements (Holding)
NOTES TO THE FINANCIAL STATEMENTS OF CICOR TECHNOLOGIES LTD.1. PRINCIPLES
General aspectsThese financial statements were prepared according to the provisions of the Swiss Law on Accounting and Financial Reporting (32nd title of the Swiss Code of Obligations). Where not prescribed by law, the significant accounting and valuation principles applied are described below. Certain prior year amounts have been reclassified to conform to the current year’s presentation. these relate to the changes due to the new Swiss Code of obligations.
Financial assetsFinancial assets include longterm loans. Loans granted in foreign currencies are translated at the rate at the balance sheet date, whereby unrealized losses are recorded but unrealized profits are not recognized.
Treasury sharesTreasury shares are recognized at market value and deducted from shareholder’s equity at the time of acquisition. In case of a resale, the gain or loss is recognized through the income statement as financial income or financial expenses.
Long-term interest-bearing liabilitiesInterestbearing liabilities are recognized in the balance sheet at nominal value. Issue costs for financial debts are capitalized and amortized on a straight line method over the financial debt maturity period.
Foregoing a cash flow statement and additional disclosures in the notesAs Cicor Technologies Ltd. has prepared its consolidated financial statements in accordance with a recognized accounting standard (Swiss GAAP FER), it has decided to forego presenting additional information on interestbearing liabilities and audit fees in the notes as well as a cash flow statement in accordance with the law.
2. INFORMATION ON BALANCE SHEET AND INCOME STATEMENT ITEMS
Long-term loans to subsidiariesLoans in the amount of TCHF 47 750 have been granted to our companies in Switzerland, Romania and Asia. Loans in the amount of TEUR 7 650 have been granted to our companies in Germany. Loans in the amount of TUSD 8 725 have been granted to our companies in Asia. A loan in the amount of TSGD 4 500 has been granted to one of our companies in Asia.
Investments
in CHF 1 000, unless otherwise stated Participation in %
Currency 31.12.2015 31.12.2014
Cicorel SA, Boudry/Switzerland* 100 CHF 8 000 8 000Engineering/Production/Sales/Distribution
Reinhardt Microtech AG, Wangs/Switzerland* 100 CHF 1 800 1 800Engineering/Production/Sales/Distribution
Reinhardt Microtech GmbH, Ulm/Germany 75 EUR 500 500Engineering/Production/Sales/Distribution
RHe Microsystems GmbH, Radeberg/Germany* 100 EUR 216 216Engineering/Production/Sales/Distribution
Electronicparc Holding AG, Wil/Switzerland* 100 CHF 23 271 23 271Holding/Finance
Swisstronics Contract Manufacturing AG, Wil/Switzerland
100 CHF 3 000 3 000
Engineering/Production/Sales/Distribution
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Cicor | Financial Report 2015 | Financial Statements (Holding) 75
Systronics SRL, Arad/Romania 100 RON 5 145 5 145Production
Systel Italia SRL, Milano/Italy 100 EUR 10 10Sales/Distribution
ESG Holding Pte Ltd., Singapore* 100 SGD 1 896 1 896Holding/Finance
Cicor Asia Pte Ltd., Singapore 100 SGD 1 000 1 000Sales/Distribution
Cicor Ecotool Pte Ltd., Singapore 100 SGD 1 000 1 000Engineering/Production
PT Cicor Panatec, Batam/Indonesia 100 USD 300 300Production
Brant Rock Enterprises Corporation, British Virgin Islands 100 USD 10 10Holding/Finance
Cicor Anam Ltd., Anam/Vietnam 100 USD 1 500 1 500Production
Suzhou Cicor Technology Co. Ltd., China 100 CNY 34 798 23 507Production
Cicor Americas Inc., USA 100 USD 10 10Sales/Distribution
Cicor Management AG, Zurich/Switzerland* 100 CHF 250 250Management Services
*) Directly held subsidiaries
Non-current interest bearing liabilitiesCicor signed a new syndicated bank loan agreement on 22 December 2014 on a total line of CHF 65 million, which was utilized by CHF 43 million cash on 31 December 2015 (please refer to page 61 for further information).
Capital structure
31.12.2015 31.12.2014
Share capital at 31 December
2 902 092 (2014: 2 892 092) registered shares of CHF 10 29 020 920 28 920 920
Issued capital and changes in capital structureThe ordinary share capital was increased in 2015 by 10 000 shares (2014: 11 584 shares) out of conditional capital at a nominal value of CHF 10 for the established stock option plans.
Cicor Technologies Ltd. is a holding company established under Swiss law. According to the provisions of law governing the appropriation of retained earnings by holding companies, the share capital and appropriations to the general legal reserve to the extent of 20% of share capital as well as the reserve for treasury shares may not be distributed.
DividendAny dividend distribution must be proposed by the Board of Directors and approved by the Annual Shareholder’s Meeting. At the Shareholders’ Meeting of 23 April 2015, the shareholders decided to allocate TCHF 1 041 from the capital contributions to the free reserves and to distribute CHF 0.36 per share (totaling CHF 1 040 613.12) to the shareholders out of these free
reserves. Due to the results in the 2015 financial year, the Board of Directors will propose to the Annual Sharholders’ meeting to forego the distribution of earnings.
Authorized capitalAt the Shareholders’ Meeting at 24 April 2014, the shareholders decided to renew the authorization of the Board of Directors to increase the share capital by a maximum of 600 000 fully paidin shares at a nominal value of CHF 10 until 24 April 2016. Conditional capitalAt the Shareholders’ Meeting of 13 May 2009, the shareholders decided to increase the conditional share capital up to 200 000 fully paidin registered shares with a total nominal value up to CHF 2 000 000 for the exercise of stock option rights granted to officers and other key employees under an employee stock option plan established by the Board of Directors. During 2015, 10 000 (2014: 11 584) shares were issued.
As of 31 December 2014, according to the stock option plans approved by the Board of Directors on 3 January 2008, 3 January 2009 and 26 November 2009, 21 793 options (previous year 35 793) were outstanding.
At the Shareholders’ Meeting of 13 May 2009, the shareholders decided to create additional conditional share capital of up to 500 000 fully paid in registered shares with a total nominal value of up to CHF 5 000 000 for the exercise of conversion rights granted to holders of convertible debt securities to be issued by the company. Such conversion rights would have to be exercised within five years of the issuance of such convertible debt securities.
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76 Cicor | Financial Report 2015 | Financial Statements (Holding)
Treasury shares
Number of shares
1 January 2014 1 500
31 December 2014 1 500
31 December 2015 1 500
Neither in 2015 nor in 2014 have any treasury shares been sold or purchased.
Financial incomeThe financial income mainly consists of the dividends of Electronicparc Holding AG (TCHF 2 700), RHe Microsystems GmbH (TEUR 350) and Reinhardt Microtech AG (TCHF 300) and of realized foreign exchange gains (TCHF 379).
Administrative expenseThe administrative expense mainly consist of remuneration to the Board of Directors of TCHF 264 and stewardship costs of TCHF 1 676 (costs charged by Cicor Management AG, costs for the annual report and annual general meeting).
ImpairmentAccording to the new law on accounting and financial reporting, article 960 CO paragraph 1, the principle of individual valuation applies for the first time while in prior years investments were valued by a portfolio approach. As consequence, impairment losses on investments in the amount of TCHF for 25 462 for Reinhardt Microtech AG and TCHF 12 538 for Cicorel SA were recorded in 2015.
3. OTHER INFORMATION
Full-time equivalentsCicor Technologies Ltd. does not have any employees.
Contingent liabilitiesFor a lease contract between Cicorel and a Swiss insurance company, Cicor Technologies Ltd. grants a guarantee in favour of the said insurance company in the amount of TCHF 5 869, which represents the discounted value of future rental payments.
Pledged assetsThe shares of the following companies at a book value of TCHF 117 308 (2014: TCHF 109 604) are in deposit with Commerzbank AG and pledged as collateral for the syndicated credit line contracted in 2014: Cicorel SA, Electronicparc Holding AG, Swisstronics Contract Manufacturing AG, Reinhardt Microtech AG and RHe Microsystems GmbH.
in CHF 1 000 31.12.2015 31.12.2014
Guarantee in favour of a Swiss insurance company 5 869 6 524
Principal shareholdersThe following shareholdings correspond to the ones reported according to the regulations of the Swiss Stock Exchange (SIX Swiss Exchange) and updated as in the shares register per yearend.
31.12.2015 Number of
shares
in %1) 31.12.2014 Number of
shares
in %1)
HEB Swiss Investment AG, Zürich, Switzerland 848 375 29.25 848 375 29.33
Quaero Capital (previously ARGOS Fund), Luxembourg 145 000 5.00 145 000 5.01
Escatec Holdings Ltd., Port Vila, Vanuatu 141 061 4.86 141 061 4.88
1) in % of the total outstanding shares.
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Cicor | Financial Report 2015 | Financial Statements (Holding) 77
Compensation of Board of Directors and Management 2015Please refer to pages 36 to 37.
Shareholdings of Board of Directors and Management
in CHF 1 000 2015 Number of
shares
2015 Number of
options
2014 Number of
shares
2014 Number of
options
Heinrich J. Essing – – – –
Robert Demuth 5 124 10 000 5 124 10 000
Andreas Dill 1 000 – – –
Erich Haefeli – – n/a n/a
Total current Board members 6 124 10 000 5 124 10 000
in CHF 1 000 2015 Number of
shares
2015 Number of
options
2014 Number of
shares
2014 Number of
options
Jürg Dübendorfer 4 000 – n/a n/a
Patric Schoch 4 000 – 3 200 –
Erich Trinkler – – – –
Jürgen Steinbichler – – n/a n/a
Total current Management 8 000 – 3 200 –
Shares or options on shares for members of the board and employeesIn 2015 and 2014, no shares or options on shares were allocated to members of the board or to employees.
Significant events after the balance sheet dateThere are no significant events after the balance sheet date which could impact the book value of the assets or liabilities or which should be disclosed here.
4. PROPOSED APPROPRIATION OF AVAILABLE EARNINGS
in CHF 1 000 31.12.2015
Gain brought forward 15 706
Net profit of the year –37 869
Gain brought forward –22 163
The Board of Directors is proposing to forego a profit distribution.
78 Cicor | Financial Report 2015 | Financial Statements (Holding)
the appropriateness of the accounting policies used and the reasonableness of accounting estimates made, as well as evaluating the overall presentation of the financial statements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion.
OpinionIn our opinion, the financial statements for the year ended 31 December 2015 comply with Swiss law and the company’s articles of incorporation.
REPORT ON OTHER LEGAL REQUIREMENTSWe confirm that we meet the legal requirements on licensing according to the Auditor Oversight Act (AOA) and indepen dence (article 728 CO and article 11 AOA) and that there are no circumstances incompatible with our independence.
In accordance with article 728a paragraph 1 item 3 CO and Swiss Auditing Standard 890, we confirm that an internal control system exists, which has been designed for the preparation of financial statements according to the instructions of the board of directors.
We further confirm that the proposed appropriation of available earnings complies with Swiss law and the company’s articles of incorporation. We recommend that the financial statements submitted to you be approved.
Zurich, 8 March 2016KPMG AG
Roman Wenk Simon WidmerLicensed Audit Expert Licensed Audit ExpertAuditor in Charge
REPORT OF THE STATUTORY AUDITOR ON THE FINANCIAL STATEMENTS TO THE GENERAL MEETING OF SHAREHOLDERS
REPORT OF THE STATUTORY AUDITOR ON THE FINANCIAL STATEMENTSAs statutory auditor, we have audited the financial statements of Cicor Technologies Ltd., which comprise the balance sheet, income statement and notes on pages 72 to 77 for the year ended 31 December 2015.
Board of Directors’ responsibilityThe board of directors is responsible for the preparation of the financial statements in accordance with the requirements of Swiss law and the company’s articles of incorporation. This responsibility includes designing, implementing and maintaining an internal control system relevant to the preparation of financial statements that are free from material misstatement, whether due to fraud or error. The board of directors is further responsible for selecting and applying appropriate accounting policies and making accounting estimates that are reasonable in the circumstances.
Auditor’s responsibilityOur responsibility is to express an opinion on these finan cial statements based on our audit. We conducted our audit in accordance with Swiss law and Swiss Auditing Standards. Those standards require that we plan and perform the audit to obtain reasonable assurance whether the financial statements are free from material misstatement.
An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial statements. The procedures selected depend on the auditor’s judgment, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers the internal control system relevant to the entity’s preparation of the financial statements in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the entity’s internal control system. An audit also includes evaluating
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SALES BY INDUSTRY2015 / 2014
SALES BY EXPORT REGION 2015 / 2014
Aerospace and defense Communication Industry Medical Automotive and transport Watches and consumer Other
Switzerland Europe (excluding Switzerland) Asia North America Other
8%
9%
30%
27%
9%
12%
5%
28%
9%
9%
27%
11%
12%
4%
40%
35%
1%
39%
36%
6% 7%
18%17%
1%
Published byCicor Technologies Ltd.
Design concept/Realisation Linkgroup AG, Zurichwww.linkgroup.ch
Fotos: Shutterstock, Belimed AG
ADDRESSESCicor Anam Ltd.15 VSIP Street 4Thuan An DistrictBinh Duong Province VietnamTel. +84 650 375 66 23Fax +84 650 375 66 24www.cicor.com
Suzhou Cicor Technology Co. Ltd.EPZ No. 11 BuildingNo. 666 Jianlin RoadSND-EPZ Sub-industrial ParkSuzhou, China 215151Tel. +86 512 6667 2013www.cicor.com
HEAD OFFICE Cicor Technologies Ltd.Route de l’Europe 82017 [email protected]
CONTACTCicor Management AGWorld Trade Center Leutschenbachstrasse 95 8050 ZurichSwitzerlandwww.cicor.com
Tel. +41 43 811 44 05 Fax +41 43 811 44 09 [email protected]@cicor.com
CICOR ADVANCED MICROELECTRONICS & SUBSTRATESCicorel SARoute de l’Europe 82017 BoudrySwitzerlandTel. +41 32 843 05 00Fax +41 32 843 05 99www.cicor.com
Cicor Americas Ltd.185 Alewife Brook Parkway,Suite #410CambridgeMA 02138USATel. +1 617 576 2005Fax +1 617 576 2001www.cicor.com
RHe Microsystems GmbHHeidestrasse 7001454 RadebergGermanyTel. +49 3528 4199-0Fax +49 3528 4199-99www.cicor.com
Reinhardt Microtech GmbHSedanstrasse 1489077 UlmGermanyTel. +49 731 9858 8413Fax +49 731 9858 8411www.cicor.com
Reinhardt Microtech AGAeulistrasse 107323 WangsSwitzerlandTel. +41 81 720 04 56Fax +41 81 720 04 50www.cicor.com
CICOR ELECTRONIC SOLUTIONSSwisstronicsContract Manufacturing AGIndustriestrasse 89552 BronschhofenSwitzerlandTel. +41 71 913 73 73Fax +41 71 913 73 74www.cicor.com
S.C. Systronics S.R.L.Zone Parc Industrial F-N310580 AradRomaniaTel. +40 257 285 944Fax +40 257 216 733www.cicor.com
Cicor Asia Pte Ltd.45 Changi South Avenue 2#04-01 Singapore 486133SingaporeTel. +65 6546 16 60Fax +65 6546 65 76www.cicor.com
Cicor Ecotool Pte Ltd.45 Changi South Avenue 2#04-00 Singapore 486133SingaporeTel. +65 6545 50 30Fax +65 6545 00 32www.cicor.com
PT Cicor PanatecBatamindo Industrial Park, Lot 323 - 324Jalan Beringin, Muka KuningBatam 29433 IndonesiaTel. +62 770 61 22 33Fax +62 770 61 22 66www.cicor.com
This annual report is published in German and English as a print and online version. The print and online German version is binding.© Cicor Technologies Ltd., March 2015
KEY FIGURES
in CHF 1 000 unless otherwise specified 2012 in % 2013 in % 2014 in % 2015 in %
Net sales 176 016 100.0 190 453 100.0 202 458 100.0 180 612 100.0
Change compared to previous year (%) –1.5 8.2 6.3 –10.8
EBITDA before restructuring costs 15 323 8.7 17 604 9.2 19 662 9.7 12 117 6.7
Change compared to previous year (%) 53.1 14.9 11.7 –38.4
Operating profit before restructuring costs (EBIT) 7 301 4.1 8 512 4.5 10 229 5.1 3 066 1.7
Restructuring costs – 0.0 – 0.0 – 0.0 –4 718 –2.6
Operating profit (EBIT) 7 301 4.1 8 512 4.5 10 229 5.1 –1 652 –0.9
Earnings before taxes (EBT) 5 057 2.9 5 816 3.1 8 958 4.4 –3 811 –2.1
Income taxes 1 081 0.6 –1 272 –0.7 –1 952 –1.0 –245 –0.1
Net profit before restructuring costs 6 138 3.5 4 544 2.4 7 006 3.5 662 0.4
Net profit/(loss) 6 138 3.5 4 544 2.4 7 006 3.5 –4 056 –2.2
Earnings per share 2.28 1.58 2.39 –1.37
Number of employees (FTEs at end of period) 1 512 1 912 1 852 1 958
Division results 2012 in % 2013 in% 2014 in% 2015 in%
AMS Division
– Sales 63 282 100.0 59 095 100.0 56 934 100.0 49 510 100.0
– EBITDA before restructuring 7 214 11.4 7 740 13.1 7 594 13.3 4 907 9.9
ES Division
– Sales 112 872 100.0 131 405 100.0 145 662 100.0 131 578 100.0
– EBITDA before restructuring 9 888 8.8 12 018 9.1 13 912 9.6 9 380 7.1
2 Cicor | Annual Report 2015 | At a Glance
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