Financial Half-Year Report23 | 24

Contents

		 LEM Group3
		Interim consolidated statementof financial position

4

Interim consolidated income statement

5		Interim consolidated statementof comprehensive income

6		Interim consolidated statementof changes in equity

7

Interim consolidated cash flow statement

8		Notes to the interim consolidated
financial statements

Interim consolidated statementof financial position

AssetsNotes

30.9.2023

31.3.2023

Cash and cash equivalents

24’68021’775

Accounts receivable

94’54686’458Inventories

52’922

56’831

4’979

3’896

in CHF thousands

Current assets

Income tax receivable

12

Other current assets

6’054

4’678

Total current assets

183’181

173’638

Property, plant, and equipment

80’75373’580

Right-of-use assets

26’23525’266

Intangible assets

7’248

5’987

48’46548’369Non-current assets

Deferred tax assets

12

Other non-current assets

707

664

Total non-current assets

163’408

153’866

Total assets

346’589327’504

30.9.2023

31.3.2023

Accounts payable

30’75836’071

Accrued expenses

32’09232’296

Lease liabilities

3’094

3’103
2’199

Liabilities and equity
Notes

in CHF thousands

Current liabilities

Income tax payable

12

3’624

Current provisions

6

1’128

601

Interest-bearing loans and borrowings

7

79’37538’414

Other current liabilities

3’176

2’228

Total current liabilities

153’246

114’912

Non-current liabilities
Non-current lease liabilities

26’73326’930Non-current provisions

6

595

1’020

Deferred tax liabilities

12

2’925

2’934

Interest-bearing loans and borrowings

7

9’750

5’175

Other non-current liabilities

8

622

2’899

Total non-current liabilities

40’62438’959Total liabilities

193’870

153’871

EquityShare capital
Treasury shares

570

570

(2’119)(1’069)Reserves(1’028)2’949

Retained earnings

155’296

171’184

152’719173’633

346’589327’504

Total equity

9

Total liabilities and equity

LEM Financial Half-Year Report 23 | 24

Page 3

Interim consolidated
income statement

April to September

Notes

in CHF thousands

Sales

2023/242022/23

223’341

198’066(118’665)(104’240)

Gross profit

104’675

93’826

Cost of goods sold

Sales expenses(14’836)(13’675)

Administration expenses(20’260)(17’709)

Research & development expenses(17’958)(16’711)

Other income
Operating profit

10

Financial expenses
Financial income

42

22

51’66445’752(1’478)

(717)

213

165

Foreign currency exchange effect(1’885)(2’464)

Profit before taxes

48’51442’736(5’119)(7’526)43’39535’210

Income taxes

12

Net profit
Earnings per share, in CHF

Basic earnings per share

38.09

30.90

Diluted earnings per share

38.02

30.88

The accompanying notes are an integral part of the interim consolidated financial statements.

LEM Financial Half-Year Report 23 | 24

Page 4

Interim consolidated statementof comprehensive income

April to September

Notes

in CHF thousands

Net profit for the period recognized in the income statement

2023/242022/23

43’39535’210(5’027)(3’749)Other comprehensive income to be reclassified to profit and loss
in subsequent periods
Currency translation difference
Income tax
Total other comprehensive income to be reclassified to profit and loss
in subsequent periods

469

446

(4’558)(3’303)

Other comprehensive income not to be reclassified to profit and loss
in subsequent periods
Remeasurement gains /(losses) on defined benefit plans

8

(171)

Net gain/(loss) on equity instruments at fair value through other comprehensive income(5)

Total other comprehensive income not to be reclassified to profit and loss
in subsequent periods

(5)

(171)

Other comprehensive income /(loss) for the period, net of tax(4’563)(3’475)

Total comprehensive income for the period

38’83231’735LEM Financial Half-Year Report 23 | 24

Page 5

Interim consolidated statementof changes in equity

Attributable to shareholders
in CHF thousands

Notes

Share
capitalTreasurysharesCapitalreserve

Translation
reserve

Retainedearnings

Total
equity1 April 2022

570

(977)

12’920(3’219)151’904

161’197

Net profit for the period
Other comprehensive income/(loss)
Total comprehensive income

35’21035’210(3’303)(171)(3’475)(3’303)35’03931’735

Share-based payments

11

224

224

Dividends paid

9

(56’958)(56’958)

Movement in treasury shares

9

(299)

299

(533)

(533)

30 September 2022

570

(1’277)

13’219(6’523)

129’675

135’665

1 April 2023

570

(1’069)13’011(10’062)

171’185

173’633

Net profit for the period
Other comprehensive income/(loss)
Total comprehensive income

43’39543’395(5’027)464(4’563)(5’027)

43’85938’834

Share-based payments

11

455

455

Dividends paid

9(59’252)(59’252)

Movement in treasury shares

930 September 2023

LEM Financial Half-Year Report 23 | 24

570

Page 6(1’050)

1’050(2’118)14’061(15’090)

(951)

(951)

155’296

152’719

Interim consolidated
cash flow statement

April to September

Notes

2023/242022/23

Profit before tax

48’51442’736

Adjustment for non-cash items

9’750

8’721

(5’375)(4’983)in CHF thousands

Cash flow from operating activities

Interest received/paid and taxes paid
Cash flow before changes in net working capital

52’88946’474

Cash flow from changes in net working capital(15’623)(9’671)37’26636’803

Investment in fixed assets(14’557)(10’587)

Investment in intangible assets(2’247)

(3)

(77)

(95)

Cash flow from operating activities
Cash flow from investing activities

Increase (–) in other non-current assets
Decrease (+) in other non-current assets
Cash flow from investing activities

3774(16’844)(10’611)

Cash flow from financing activities
Treasury shares acquired (–)

9(4’569)(4’457)

Treasury shares divested (+)

9

3’618

3’923

Payment of lease liabilities(2’057)(917)(59’252)(56’958)

Dividends paid to the shareholders of LEM HOLDING SA

9

Increase (+) in financial liabilities

7

84’91094’150Decrease (–) in financial liabilities

7(39’050)(55’500)(16’400)(19’759)

4’023

6’433

Cash and cash equivalents at the beginning of the period

21’775

17’198Exchange effect on cash and cash equivalents(1’118)(296)

Cash and cash equivalents at the end of the period

24’68023’334

Cash flow from financing activities
Change in cash and cash equivalents

LEM Financial Half-Year Report 23 | 24

Page 7

Notes to the interim
consolidated financial
statements
1.

General information

LEM Group (the Group) is a leading company in the field of electrical measurement. LEM engineers best-in-class solutions forenergy and mobility, ensuring that its customers’ systems are optimized, reliable, and safe.
The parent company of LEM Group is LEM HOLDING SA (the Company), which is a limited company incorporated in Switzerland.

2.

Significant accounting principles

These unaudited consolidated financial statements for the six months ended on 30 September 2023 have been prepared inaccordance with International Accounting Standard (IAS) 34 “Interim Financial Reporting”. They do not include all the information and disclosures presented in the annual consolidated financial statements and should therefore be read in conjunction
with those for the year ended 31 March 2023.
The accounting and valuation policies are consistent with those applied in preparing the annual consolidated financial statements for the year 2022/23.
The preparation of the interim consolidated financial statements in conformity with IFRS requires management to make estimates and assumptions that affect the reported amounts of revenues, expenses, assets and liabilities, and related disclosuresat the date of the interim financial statements. These estimates are based on management’s best knowledge of current eventsand actions that the Group may undertake in the future. However, actual results could differ from those estimates.
The financial information is presented in thousands of CHF. The totals are calculated with the original unit amounts, which could
lead to rounding differences. These differences in thousands of units are not changed to keep the accuracy of the original data.
Amendments in IFRS, effective as of January 2023, did not have a material impact on the interim consolidated financial statements. The Group has not early adopted any standard or amendment that has been issued but is not yet effective.

3.

Exchange rates

The exchange rates for the most significant currencies are as follows:

Currency

Income statementof 2023/24

Income statementof 2022/23

Balance sheet
as at 30.9.2023

Balance sheet
as at 31.3.2023
Year-end rate in CHF

Average rate in CHF

Average rate in CHF

Half-year rate in CHF

BGN

0.496

0.511

0.494

0.509

CNY

0.125

0.144

0.125

0.133

DKK

0.130

0.134

0.130

0.134

EUR

0.970

1.000

0.967

0.995

GBP

1.122

1.174

1.115

1.131

JPY

0.00630.00720.00610.0069
0.207

MYR

0.195

0.219

0.195

RUB

0.010

0.015

0.009

0.012

USD

0.891

0.965

0.914

0.914

LEM Financial Half-Year Report 23 | 24

Page 8

Notes to the interim consolidated
financial statements

4.

Segment information

For management purposes, LEM Group is organized into two reportable segments as follows:– The Asia region, which includes China, Japan, South Korea, India, and South-East Asia.
– The Europe/Americas region, which includes Europe, the Middle East, Africa, the NAFTA countries, and Latin America.
Although the reportable segments provide similar electronics components called transducers for applications in different customer sectors, each region is managed separately in order to better align it with the location of the Group’s customers anddistribution partners and the unique market dynamics of each geographic region.
The Group evaluates the performance of its reportable segments based on net sales and operating profit. Net sales for geographic segments are based on the location of customers. Operating profit for each segment includes net sales to third parties,
related cost of sales, and operating expenses directly attributable to the segment.
The operating profit for each segment excludes centralized headquarter support functions as well as certain research and development costs managed outside of the reportable segments.
The segment information is presented net of intersegment transactions.
The Group does not include intercompany transfers between segments for management reporting purposes. The reporting
segments are presented in a manner consistent with the internal reporting.

Business segment information
Asia

Europe/Americas

In CHF thousands

2023/242022/232023/24

Sales

112’463116’025

Operating profit

38’87747’154

Total

2022/232023/242022/23110’878

82’041

223’341

198’066

43’96423’98582’841

71’140

Other operating costs*(31’177)(25’388)

Group operating profit

51’66445’752*Those costs are managed outside of the reporting segments and are linked to centralized headquarter support functions as well as certain research and development costs.

LEM Financial Half-Year Report 23 | 24

Page 9

Notes to the interim consolidated
financial statements

5.

Revenue information

Regional information
2023/242022/23

China

68’22882’062

Japan

14’19914’189South Korea

16’703

11’190Rest of Asia

13’333

8’584

Total for the Asia region

112’463116’025

Germany

29’25619’380

Italy

7’221

6’009

Rest of EMEA

49’43933’017USA

23’057

20’776

Rest of Americas

1’905

2’858

Total for the Europe/Americas region

110’878

82’041LEM Group223’341

198’066

In CHF thousands

Sales

6.

Current and non-current provisions

Warranty and customer claims
Provisions for warranty and customer claims have been estimated based on experience and the risk assessment of management. The warranty provision is expected to be used over the next five years.
Litigation and consumption taxes
Despite the care that LEM applies in the separation process with personnel, such separation may result in legal conflicts. The
Group will defend its case and management estimates the reasonable risk to be adequately provided for.
The Group operates in multiple jurisdictions with complex legal and tax regulatory environments. As part of the continuous improvement of its processes and systems, LEM has reviewed the consumption taxes in several countries. It appears that someof LEM’s subsidiaries may not have been fully compliant with their local consumption tax regulations. Consequently, LEM has
estimated consumption tax provisions according to management’s best judgment. Some of these positions are inherently uncertain and involve the interpretation of local regulations applied to complex transactions.

LEM Financial Half-Year Report 23 | 24

Page 10

Notes to the interim consolidated
financial statements

7.

Financial liabilities

LEM Group increased its financial short-term liabilities to CHF 79.4 million (CHF 38.4 million on 31 March 2023) through shortterm credit lines to finance the CHF 59.3 million dividend payment of July 2023.
LEM Group increased its financial long-term liabilities to CHF 9.8 million to finance its future Malaysian plant.

8.

Other non-current liabilities

As of 30 September 2023, the retirement benefit obligation remains in a surplus amounting to CHF 2.9 million (CHF 4.3 million
on 31 March 2023). Consistent with year-end, the surplus has been restricted to nil as the economic benefit in the form of areduction in future contributions cannot be realized.

9.

EquityDuring the Annual General Meeting held in Geneva on 29 June 2023, the shareholders approved the distribution of an ordinary
dividend of CHF 52.00 per share. The gross dividend effectively paid on 6 July 2023 amounted to CHF 59.3 million (prior year:
ordinary dividend of CHF 50.00; total CHF 57.0 million).
Within the framework of its market-making contract, LEM holds its own shares. On 30 September 2023, the Group held 1’059
shares (31 March 2023: 555).

10.

Operating profit

Our sales increased by +12.8% to CHF 223.3 million in the first half of 2023/24; at constant exchange rates, this represents asales increase of +22.0%.
Our gross margin stood at 46.9%, slightly down from 47.4% in the first half of 2023/24, with an EBIT amounting to CHF 51.7
million (increase of +12.9% in the first half of 2023/24). Our operating profit margin for the first six months of 2023/24 was
23.1% compared with 23.1% a year earlier.

LEM Financial Half-Year Report 23 | 24

Page 11

Notes to the interim consolidated
financial statements

11.

Share-based payments

As of 2022/23, the Board of Directors of LEM HOLDING SA decided to grant Senior Executives and Managers a long-term incentive plan composed of share-based performance share units (“PSUs”).
The number of shares obtained per PSU can thereby vary between 0% and 200% of the award, subject to continuous employment and depending on the achievement of pre-agreed performance conditions.
The performance conditions include non-market and market conditions such as economic value added (“EVA”), absolute total shareholder return (“absolute TSR”), and total shareholder return measured relative to the SPI EXTRA® Total Return Index(“relative TSR”). The grant-date fair value estimate of market conditions is based on a Monte Carlo simulation. The performance
conditions are measured over a period of three consecutive financial years starting with the financial year during which theaward date occurs relevant for measuring the long-term performance.
The Group accounts for the PSU as an equity-settled plan.
These allotments are recognized as an expense representing the fair value of the services rendered by the beneficiaries. The
fair value of the services is determined by reference to the fair value of the shares on the grant date. The performance conditions are considered when estimating the number of shares to be granted at the end of the vesting period. The benefits granted
constitute expenses and are recognized on a straight-line basis over the vesting period in the income statement together witha corresponding increase in the consolidated reserves.
Grant date

Vesting period

30.9.2023
ExpensePlan 2022 – 2025

20.7.2022

3 years

210

Plan 2023 – 2026

19.7.2023

3 years237

In CHF thousands

Total

12.

447

Income taxes

Income tax expense is calculated based on the best estimate of the applicable annual income tax rate expected for the full year.
The Group operates in multiple jurisdictions with complex legal and tax regulatory environments. In certain jurisdictions, theGroup has taken income tax positions that management believes are supportable and are intended to withstand challenge
by tax authorities. Some of these positions are inherently uncertain and include those relating to transfer pricing matters andthe interpretation of income tax laws applied to complex transactions. The Company periodically reassesses its tax positions.
Changes to the financial statement recognition, measurement, and disclosure of tax positions are based on management’s
best judgment given any changes in the facts, circumstances, information available, and applicable tax laws. Considering all
available information and the history of resolving income tax uncertainties, the Group believes that the ultimate resolution ofsuch matters will not have a material effect on its financial statements.
Differences between the final tax outcome and the amounts that were initially recorded impact the income and deferred taxes
in the period in which such determinations are made. The Group calculates its expected average tax rate as a weighted averageof the tax rates in the tax jurisdictions in which the Group operates.
At 10.6%, the average tax rate decreased compared to 17.6% for the first half-year 2022/23. As of 30 September 2023, LEM
Group recognized a tax profit of CHF 2.4 million related to the increase of its deferred tax assets. This is mainly due to the decision taken by Swiss cantonal authorities in September 2023 to raise the income tax rate in 2024.

LEM Financial Half-Year Report 23 | 24

Page 12

Notes to the interim consolidated
financial statements

13.

Financial assets and liabilities

Financial assets
30.9.2023
Book value

31.3.2023
Book value

Amortized
cost

Cash and cash equivalents

24’68021’775

X

Accounts receivable

94’54686’458X

Derivative financial instruments – current

1

42

Other current financial assets

1

2

X

658

664

X

119’886

108’941

In CHF thousands

Other non-current financial assets
Total

At fair value
through
profit andloss

X

Financial liabilities
30.9.2023
Book value

In CHF thousands

31.3.2023
Book value

Other financial liabilities

Accounts payable

30’75836’071

X

Accrued expenses

32’09232’296X

Derivative financial instruments – current
Other current financial liabilities
Other non-current financial liabilities
Total

126

0

79’37538’414

X

9’750

5’175

X

152’100

111’956

At fair value
through
profit andloss

XChanges in liabilities arising from financing activities
Cash impact

1.4.2022

Cash flows
Inflow

Non-cash
impactCash flows(outflow)

Fair valuechanges andOthers

30.9.2022

In CHF thousands

Interest-bearing loans and borrowings

40’65094’150(55’500)(84)

79’216

Total

40’65094’150(55’500)(84)

79’216

Cash impact

1.4.2023

Cash flows
Inflow

Non-cash
impactCash flows(outflow)

Fair valuechanges andOthers

30.9.2023

In CHF thousands

Interest-bearing loans and borrowings

43’58984’910(39’050)(324)

89’125

Total

43’58984’910(39’050)(324)

89’125LEM Financial Half-Year Report 23 | 24

Page 13

Notes to the interim consolidated
financial statements

The management assessed that the fair value level of cash and cash equivalents, accounts receivables, other current andnon-current assets, accounts payables, accrued expenses, and other current and non-current liabilities that are not measured
at fair value are approximate to their carrying amounts in view of their short-term nature and are consequently not separately
disclosed.
The Group enters into derivative transactions such as currency risk reversal and forward contracts to hedge the USD, EUR, and
JPY risks. The purpose of these currency hedges is to manage the currency risks arising from the Group’s operations.
It is the Group’s policy that no derivatives for speculative purposes shall be entered into.
The main risks arising from the Group’s financial instruments are foreign currency risks and credit risks, whereas the others areof minor or no impact.
The Board of Directors reviews and agrees policies for managing each of those risks.
The Group’s net financial liabilities at fair value amount to CHF 125’000 as of 30 September 2023 (net financial assets of CHF
42’000 as of 31 March 2023) and are all classified under Level 2.
During the last reporting period, there were no transfers between Level 1 and Level 2 fair value measurements, and no transfers
into and out of Level 3 fair value measurements.

14.

Changes in scope of consolidation

On 28 July 2023, LEM Advisory Services SA was liquidated.

15.

Events after the balance sheet date

There was no event subsequent to the balance sheet date that requires adjustment to or disclosure in the financial statements.

LEM Financial Half-Year Report 23 | 24

Page 14

Notes to the interim consolidated
financial statements

Financial calendar
The financial year runs from 1 April to 31 March
2 February 2024

Nine-month results 2023/24

28 May 2024

Full-year results 2023/24

27 June 2024

Annual General Meeting of Shareholders for the financial
year 2023/24

2 July 2024

Dividend ex-date

4 July 2024

Dividend payment date

LEM Financial Half-Year Report 23 | 24

Page 15

ContactAndrea Borla, Chief Financial Officer
Phone: +41 22 706 12 50
E-mail: investor@lem.com
Address
LEM HOLDING SA
Route du Nant-d’Avril 1521217 Meyrin
Geneva, Switzerland
www.lem.com

LEM HOLDING SA
Route du Nant-d’Avril 1521217 Meyrin
Geneva, Switzerland
www.lem.com

Financial Half-Year Report 23 | 24