H A L F -Y E A R R E P O R T 2 014

INSPIRED BY EFFICIENCYKEY FIGURESKEY FIGURES
01.01.–
30.06.2014

01.01.–
30.06.2013

Changes in %Total incoming orders

172.9

170.6

1.3

Drives

56.0

54.6

2.6

Rollers

39.4

38.6

2.1

Conveyors & Sorters

33.5

26.1

28.4

in CHF million, if not stated otherwise
Incoming orders / net sales

Pallet- & Carton Flow

28.2

29.8

–5.4

Total net sales

157.1

149.1

5.3

–14.9

Profitability
EBITDA

18.2

21.4

in % of net sales

11.6

14.4

EBITA

12.8

16.0

in % of net sales

8.1

10.7

–20.2

EBIT

8.8

13.1

in % of net sales

5.6

8.8

Result7.1

10.5

in % of net sales

4.5

7.1

Operating cash flow

5.0

17.6

in % of net sales

3.2

11.8

Free cash flow

0

11.2

in % of net sales

0

7.5

30.06.2014

31.12.2013

Changes in %Total assets

265.5

258.2

2.9

Net financial assets (-debts)

12.5

20.2

Equity

186.1

187.2

Equity ratio (equity in % of assets)

70.1

72.5

Return on equity (in %)

7.6

11.9

32.8
–32.2

Cash Flow

in CHF million, if not stated otherwise–71.6–100.0

Balance sheet–0.6CONTENTSCONTENTS
About Interroll4Interroll on the capital market5
Report by the Board of Directors and Group Management6
Overview of financial position, earnings and cash flows8
Overview by product groups10
Overview by regions13

Financial Statements of Interroll Group

15

Consolidated statement of financial position15
Consolidated income statement16
Consolidated statement of comprehensive income17
Consolidated statement of cash flows18
Consolidated statement of changes in equity19
Notes to the consolidated financial interim statements

20

Basis of the consolidated financial statements

20

Segment information

22

Notes to the consolidated statement of financial position

23

Notes to the consolidated income statement

24

Notes to the consolidated statement of cash flows

25

Notes to the consolidated statement of changes in equity

25

Further disclosures and information

26

Imprint27
Financial calendar 2015

27

Contact27

ABOUT INTERROLL

INTERROLL GROUPABOUT INTERROLLInterroll Group is a worldwide leading provider of high-Interroll is engaged in global research projects on logistics

quality key products and services for internal logistics.

efficiency and actively supports industry associations

The company offers a broad product range in the four prod-in developing standards. Headquartered in Sant’Antonino,uct groups “Rollers”, “Drives”, “Conveyors & Sorters” andSwitzerland, Interroll operates a worldwide network of“Pallet & Carton Flow” to around 23,000 customers around

31 companies with around 1,800 employees. The company

the world.

was founded 1959. Since 1997, Interroll Group has been listedon the SIX Swiss Exchange and is included in the SPI index.

Core industries are courier, parcel, express and postal services, airports, food processing as well as distribution centres.

www.interroll.com

Customers are amongst others well-known global brands
such as Amazon, Bosch, Coca-Cola, Coop, DHL, FedEx,
Peugeot, PepsiCo, Procter & Gamble, Siemens, Walmart or
Yamaha.

Interroll product groups

4

Rollers

DrivesConveyors & Sorters

Pallet & Carton Flow

INTERROLL GROUPINTERROLL ON THE CAPITAL M ARKET

INTERROLL ON THE CAPITAL MARKET
International stock markets characterised
by volatility

Whereas some of the European stock markets only managed

The development of the stock markets during the first half

growth in the first six months of 2014. The SMI Index rose byof 2014 was characterised by a volatile sideways movement.

4.3 % compared to its closing price on 31 December 2013.

to move sideways, the Swiss stock market experienced solid

The crisis in Crimea and the resulting fear of a new East-West
conflict, concerns over China’s growth prospects and signi­

Interroll share developed positively

ficant devaluations in currencies in various emerging nations

The Interroll share continued to show an upwards trend

exerted enormous pressure on the capital markets at times.

during the first half of 2014 following its extremely strong

On the other hand, the successful placement of government

performance in 2013. On 30 June 2014, it closed at a pricebonds by the countries in crisis Ireland and Portugal, signalsof CHF 525, which means it was 7.1 % higher than at the end

from the European Central Bank (EZB) on further monetaryof 2013.

policy easing and the raising of the American limit on debt
had positive effects on the stock markets.

The Interroll share’s performance thus matched that of the
SPI Index, which reached 8,456 points on 30 June 2014 andwas thus 7.9 % higher than its year-end price of 7,838 points
in 2013.

Share price performance Interroll vs. SPI /SXGE

© Swissquote

20 %

590

15 %

565

10 %

540

5%

515

0%

490

–5 %

January
Interroll share

February

March

April

May

June

425

SPI/SXGE

5REPORT BY THE BOARD OF DIRECTORS AND GROUP MANAGEMENTREPORT BY THE BOARD OF DIRECTORSAND GROUP MANAGEMENT

Dear Shareholders, Customers and Business Partners,
For Interroll, the financial year 2014 can be positively characterised by important projects and investments aimed atachieving sustainable growth and profitability. The economic
climate remains challenging and we continue to see diverse
regional developments in the global market for internal
logistics solutions. In Europe, however, the mood among ourcustomers has improved considerably since the middle ofthe second quarter.
We succeeded in continuing our current growth course in
Kurt Rudolf
Chairman of the Board of Directors

the first six months of 2014. Our order intake increased from
CHF 170.6 million in the first half of 2013 to CHF 172.9 million in 2014. Sales increased by a solid 9.1 % in local currency.
In Swiss Francs, sales rose by 5.3 % in the first six monthsof 2014 to CHF 157.1 million (previous year: CHF 149.1 million). The first half of 2013 included a large one-time orderplaced by Red Bull in Thailand that was worth approximately
CHF 6.5 million, however. If we were to leave this order fromRed Bull out of the equation, we would have recorded a significantly higher order intake than last year.
Due to the good financial situation and solid balance sheet, wewere able to drive two projects forward simultaneously from a
position of strength in financial year 2014 in order to continue
pursuing our growth strategy. On the one hand, we launchedPaul ZumbühlCEO

our new modular conveyor platform in Europe. On the other
hand, we consolidated our plants in the USA. Both projects
have a one-time impact on the result of our current financial
year. The additional costs that can be considered an investment in our continued growth only represent a temporary
short term burden on our earnings. Around two-thirds werealready incurred in the first half of 2014.
Our EBITDA was therefore CHF 18.2 million (previous year:
CHF 21.4 million) on 30 June 2014 and our EBITDA margin
was at 11.6 % (previous year: 14.4 %). Earnings amounted to
CHF 7.1 million (previous year: CHF 10.5 million).

6



REPORT BY THE BOARD OF DIRECTORS AND GROUP MANAGEMENTWith the launch of our new modular conveyor platform, weInterroll also took the next strategic step in gaining accesshave laid yet another important cornerstone on ensuring ato the Chinese market by opening a new Asian headquarters

sustainably positive business development. This new concept

in Shanghai in March 2014. Together with the regional ­offers our customers key advantages starting from fasterCenter of Excellence in Suzhou and the new plant in Shenzhen

planning and installation of the system to up to 50 % shorteras production sites, we will extend the services we offer todelivery times, high flexibility and increased throughput,

customers across Asia. We expect the demand for products

but also energy savings and rapid return on investment. The

and solutions in the area of intra-company logistics in

feedback on the introduction of the new platform at CeMAT

China to continue to grow sharply in the years to come.

in Hanover in May 2014 was overwhelmingly positive. We
will begin introducing it to the market in the fall of 2014 andWe also strengthened our sales activities in Europe and now

then launch the platform in the USA and China in 2015.

serve the Portuguese market too with our own sales force.

We expect our new platform to have a very positive ­effect on

In the past, Interroll Spain served our customers here. Now,

our sales in the medium term.

they stand to benefit from direct, first-class service.

We decided to consolidate our companies in North America

Our excellent performance, strong power of innovation andmainly for the following reasons: we acquired Portec, yet

confidence in our business, but also our growth possibili-

another company in the USA, in 2013 and we built up ourties are also reflected in our share’s development, which rose

new regional Center of Excellence in Atlanta. We expectby 7.1 % in the first half of 2014. Interroll’s share price wasto continue to see strong growth in North America. We will

CHF 525 on 30 June 2014.

continue to optimise our manufacturing. This called for us
to close our two plants in Jeffersonville, USA, and Concord,

We will continue to do everything we can to continue writing

Canada, and bundle production at our regional Centres ofInterroll’s success story this year too. With our clear focus

Excellence in Wilmington and Atlanta. We are also planningon innovations, we will seek to meet the high demands thatto expand our new Portec site in Cañon City, Colorado, into

our customers place on key products and solutions in thea regional Centre of Excellence. The new regional Center ofarea of internal logistics and thus further extend our leading

Excellence in Atlanta, a state-of-the-art production facility

global market and technological position.

for dynamic storage, modules and subsystems, was officiallyopened in March 2014. 160 enthusiastic customers attended

We would like to thank all of our employees for their com-the opening event. This means we laid important milestones

mitment in contributing to Interroll’s positive development.

in the first half of 2014 on strengthening our position in the

And we also thank our customers, suppliers, financiers and,North American market.

of course, you, our dear shareholders, for your trust in ourcompany.

Interroll announced the acquisition of Pert Engineering in
Shenzhen, China, on 1 July 2014. We gain direct sales accessSant’Antonino, 8 August 2014

for our high-quality belt curves and other internal logistics
solutions in China through this acquisition. The Pert production site employs 60 experienced people, holds a leading
position and specialises in serving airports, distribution
and logistics customers in the Asia-Pacific region. With thisacquisition, we are continuing to execute on our strategy
of pursuing further growth in the area of belt curves.

Kurt Rudolf
Chairman of the Board of Directors

Paul Zumbühl
CEO
Chief Executive Officer

We already took the first step by acquiring Portec in the
USA in 2013.

7

OVERVIEW OF FINANCIAL POSITION, EARNINGS AND CASH FLOWSOVERVIEW OF FINANCIAL POSITION, EARNINGS AND CASH FLOWS

Significant events for business development

In local currency, we managed to increase our order intake

On 1 July 2014, we announced the acquisition of Pert Engi-by 4.5 % and our sales by a very good 9.1 %.

neering in Shenzhen, China. The company is a market leader
and specialises in serving airport, distribution and logistics

The growth in order intake and sales can be attributed tocustomers in the Asia-Pacific region. The acquisition of ourorganic growth in sales as well as successful integration ofprevious joint venture partner, who was a licensed manufac-

Portec, the company we acquired in the USA.

turer of Portec belt curves, gives us direct sales access for ourin China. The company reported sales of around USD 4 mil-Results burdened by investments
in future growthlion in 2013. Through this acquisition, we are continuing

In the first half of 2014, we made significant future-oriented

to implement our strategy of further internationalisation andinvestments that incurred exceptionally one-time expenses.

growth in the area of belt curves.

Due to our solid financial situation, we pushed consolidation

high-quality belt curves and other internal logistics solutionsof our companies in North America as part of our acquisi-

Continued positive development of order intake
and sales

tion of Portec Inc. as well as the new Center of Excellence inIn the first six months of 2014, order intake increased tomodular conveyor platform had a negative one-time impact

CHF 172.9 million (2013: CHF 170.6 million). Sales reachedon our results for the first half of the year.

­Atlanta. This together with the development of our new

CHF 157.1 million and thus rose by 5.3 % compared to
the 2013 reporting period, which was already quite strong

For this reason, our profit before interest, taxes, depreciation(CHF 149.1 million). The previous year’s figures ­included

and amortisation (EBITDA) was CHF 18.2 million in the firstthe large one-time order we received from Red Bull Thailand

half of 2014 (previous year: CHF 21.4 million). Our EBITDA

worth approximately CHF 6.5 million.

margin was 11.6 % (previous year: 14.4 %).

Order intake

Net sales
166.3

144.6

2010

8

170.6

172.9

153.0

2011

2012

2013

2014

136.8

137.2

2010

2011

147.4

149.1

2012

2013

157.1

2014



OVERVIEW OF FINANCIAL POSITION, EARNINGS AND CASH FLOWS

Earnings before interest and taxes (EBIT) was CHF 8.8 mil-

EBITDAlion in 2014 compared to CHF 13.1 million in 2013. The
EBIT margin in 2014 was 5.6 % following 8.8 % in 2013. The
reporting period 2014 includes additional amortisation fromthe acquisition of the patents and customer assets of the

20.5

19.6

2011

2012

21.4
18.2

15.2

2013 acquired company Portec of nearly CHF 0.9 million.
Compared to last year’s result of CHF 10.5 million, this year’s
result was CHF 7.1 million.

Balance sheet reflects growth and acquisition

2010

2013

2014

The balance sheet increased as of 30 June 2014 to CHF 265.5
million and was thus 2.9 % higher than the value at the end of2013 (CHF 258.2 million). This increase can be attributed toEBITvarious inward stock movements and additional assets.
13.2
Equity amounted to CHF 186.1 million on 30 June 2014
and was thus slightly lower than it was on 31 December 2013
(CHF 187.2 million). This mainly resulted from the distri­

11.6

13.1
8.8

7.5

bution out of reserves from capital contributions that wasapproved at the Annual General Meeting in May 2014.
The equity ratio was thus 70.1 % compared to 72.5 % on
31 December 2013.

2010

2011

2012

9.9

9.5

2013

2014

Continued positive free cash flow
We generated an operating cash flow of CHF 5.0 million in
the first six months of 2014. The decline compared to

Resultthe previous year’s period can mainly be attributed to lower
earnings and increased current assets.

10.5
7.1

The investments in future growth of CHF 6.2 million weremainly related to our new plant in Atlanta, expansion

5.3

and modernisation of our machinery, and the SAP project.
We were able to generate free cash flow of CHF 0.03 million
in the first half of 2014.
2010

2011

2012

2013

2014

9

OVERVIEW BY PRODUCT GROUPOVERVIEW BY PRODUCT GROUP

Product group “Drives”
The product group Drives continued its successful growthby 2.6 % to CHF 56.0 million in the first half of 2014 (2013:
CHF 54.6 million). Order intake increased by 2.6 % from
CHF 55.4 million to CHF 56.9 million. In local currency
the order intake was substantially higher. A variety of different factors contributed to this positive development.
The trend towards greater flexibility and higher energy savings
with conveyors remains intact and has a positive effecton our sales in the area of RollerDrives. Here we are the only
­vendor that offers a broad 24 volt RollerDrive product port­foliothat ranges from RollerDrives and control systems to complete
modular solutions for easy installation. Sustain­ability also
plays an increasingly important role for our c­ ustomers. Our
energy-saving RollerDrives are not only ideal for installation at

Interroll Multiprofile contributes to higher flexibility, reduction ofmaintenance and retrofit times and lower storage.

new facilities, but also for so-called retro­f itting. We offer ourcustomers the chance to either switch over to a new system atonce or to gradually implement our new technology.

In Europe, our drum motors are used among others by the
Italian global market leader in the area of packaging and

The renowned company Villeroy & Boch’s high-bay w­ arehousesealing machines, G. Mondini Spa. To date we have alreadyin Merzig, Germany, is an excellent example. We started

shipped 20,000 drum motors to this customer and always

switching their commissioning system over to RollerDrives

meet its strict demands for quality and offer fast service fromabout seven years ago and in the meantime have converted

Interroll all over the world.

several of the individual commissioning zones over from theold 400 volt system to our 24 volt drives. Approximately 30 %In the USA, our drum motors have received certification andenergy savings have been achieved and the speed has increased

approval by the US Department of Agriculture (USDA). Our

by roughly the factor of 10 with this new system.

drum motor is thus one of the few that meets the hygiene regulations on the construction and manufacturing of devices

We continued our development efforts in the area ofused to process milk products and thus the strict regulations

drum motors and managed to reduce the noise level of ouron food safety and processing. With an average growth rate

­synchronous drum motors. The newly developed Interrollof around 9 % in the years to come, we feel the food market in

Multiprofile also offers our customers significant benefits

the USA will offer attractive potential for acquiring more newsuch as increased flexibility, a reduction in the maintenancecustomers in the future.

and retrofit times and lower storage. Interroll Multiprofile is10

manufactured using yet another new development, theWe have also worked on further optimising our processes­“Interroll Premium Hygienic PU,” a hygiene-friendly material

and on our production layout at our Centre of Excellence

that complements our product portfolio that meets European

for drum motors in Baal, Germany. This translates into evenhygiene regulations (EHEDG).

faster delivery times for our customers.



OVERVIEW BY PRODUCT GROUP

Product group “Rollers”

Product group “Conveyors & Sorters”

We are seeing a positive development in our product group

The product group Conveyors & Sorters managed to top last

Rollers. We posted sales of CHF 39.4 million which were thus

year’s high sales figure, due to the acquisition of Portec among

2.1 % higher than the previous year’s figure of CHF 38.6 mil-other things, and reported sales of CHF 33.5 million, anlion. We managed to increase order intake rather significantly

impressive 28.4 % higher than in the first six months of 2013

from CHF 38.8 million in the first half of 2013 to an encour-(CHF 26.1 million). Order intake in 2014 was CHF 47.8 million

aging CHF 41.1 million in 2014 (+ 6.0 %).

compared to CHF 39.0 million in 2013 (+ 22.7 %).

The 500 million conveyor rollers we manufactured until today

The trend toward automation driven mainly by e-commerce

make us the global market leader in this area. Our partners

and ergonomics in the working environment continues.

also appreciate us because of our quick delivery times andTrading companies are demanding both flexibility and speed.

good quality and we have been realising outsourcing projects
for years. In fact, we also realised this type of outsourcing

We received lucrative orders for our sorters from Asia-Pacific.

project for an important customer in the first half of 2014.

The Chinese Post with whom we were already working together successfully placed another order for several sorters.

We continue to offer our customers the chance to plan our

Furthermore, we installed new conveyor technology atrollers in their own layout by using our Interroll configura-

Alfamart, Indonesia’s largest retailer, for the ninth time andtor software. Through our platform we are able to produce

equipped the new distribution centre in Karawang with

60,000 different roller variants on the basis of considerably­conveyors. We also successfully installed a cross belt sorter

lower raw material. This software is being received very posi-that sorts around 50,000 shipments per day at City-Link

tively by the market. And understandably so, because it helps­Express, an international provider of courier services based

save a lot of time in planning a system.

in Malaysia.
Our new modular conveyor platform, which we introduced
to a global audience for the first time in May 2014 at CeMATin Hanover, will be launched in Europe starting in the fallof 2014. The launch in the USA and China will follow in 2015.
In the medium term, we expect this innovative platform tohave a very positive impact on sales. This area offers greatoutsourcing potential and meets with considerable interest
among our customers. New applications can be supported due
to our flexibility and much shorter delivery times.

Paul Zumbühl, CEO Interroll Worldwide
Group, and Michael Kuhn, Managing Director
Interroll Automation Sinsheim, introduce
the new Modular Conveyor Platform to aninternational press audience.

11

OVERVIEW BY PRODUCT GROUP

Product group “Pallet & Carton Flow”
The development of sales and order intake this year in thePallet & Carton Flow product group is significantly influenced by the order that Red Bull Thailand placed in the firsthalf of 2013 worth around CHF 6.5 million. This large, onetime order therefore distorts the picture somewhat.
For this reason, sales of CHF 28.2 million were somewhat
lower than in the same period last year (2013: CHF 29.8 million). Order intake dropped from CHF 37.5 million to
CHF 27.2 million. Besides, several projects were rescheduledin Southeast Asia.
We are seeing high demand for our dynamic storage solutionsin North America. For example, for the first time ever, we
received an order valued at more than CHF 1 million froman important German manufacturer in the area of laundry &home care in Mexico through a local partner.
Sales in the area of Pallet & Carton Flow in North and SouthThe introduction of the new Modular Conveyor Platform at CeMAT
generated large interest with the international visitors.

America rose by very good 21.8 % in the first half of 2014.
We installed our Versi-Flow System at Pick n Pay, the most

We are also very successful in Germany with our dynamic

important retailer in Africa, in close cooperation with thestorage solutions and are now a service partner for a large

filler SABMiller back at the beginning of 2014. Interroll Ver-

American manufacturer of soft drinks. And in France, we

si-Flow, an economical, versatile product from the productreceived an order from a large Swedish furniture chain tofamily Carton Flow, is based on the First In-First Out systemequip 30 warehouses with our Versi-Flow system following an(FIFO) and guarantees faster access to the products stored

intensive and successful test phase.

and ergonomically better storage and goods issue. This optimises retailers’ work processes.

Thanks to our new cooperation partner Trading House“Kifato MK” in Russia, we will be able to tap into this market
much better in the future. Trading House “Kifato MK”

Sales by product groups­a lready has a strong market position; therefore we will beable to selectively expand our sales capacities there.
Drives 36 %Rollers 25 %Conveyors & Sorters 21 %Pallet & Carton Flow 18 %12

OVERVIEW BY REGIONOVERVIEW BY REGION

Different developments in the threeoperative regions
We have continued to pursue our internationalisation
strategy by entering into new markets and acquiring newcustomers. And, in fact, business developed positively
in all three regions, EMEA (Europe, the Middle East andAfrica), the Americas and Asia-Pacific.

Positive trend characteristic of developmentin the EMEA region
Whereas sales in the EMEA region declined by 5.7 % in
­f inancial year 2013, our sales in the first half of 2014 werevirtually stable at CHF 101.0 million compared to 2013

Small customer groups visit the new Center of Excellence in Atlanta
during the grand opening.

(CHF 102.4 million). Our customers were in a much bettermood in the second quarter of 2014 and we expect thisto have a positive effect on order intake in the second half ofSales develop very positively in the Americas

2014 and in 2015.

Sales growth of 27.6 % in the Americas during the first halfof 2014 can for the most part be attributed to the acquisition

Sales in the various European regions continued to developof Portec in July 2013. Sales in the first six months of 2014

at different paces. Due to investments in logistics projects

amounted to CHF 37.1 million compared to CHF 29.0 million

that were overdue in France, Germany and Spain, wein 2013.

­managed to increase sales in these countries by an averageof 5 %. Growth in Scandinavia even exceeded 10 %. Our

The first half of 2014 was characterised by the consolidationcompanies in Italy and Turkey also developed extremelyof our companies in North America and the start-up phase at

positively. In fact, the Italian company we opened in 2013

our new regional Center of Excellence in Atlanta. We closed

was already able to obtain interesting orders in the area of

our plants in Jeffersonville, USA, and Concord, Canada, and«Conveyors & Sorters».

bundled manufacturing at our regional Centers of Excellencein Wilmington and Atlanta. In addition, we are planningBy establishing our own sales in Portugal, we will be able

to expand our Portec site in Cañon City into a regional Center

to serve this market directly in the future. The main focus

of Excellence.

here will be on the areas food processing, e-commerce,
postal and package services, as well as security and logistics
at airports.

13

OVERVIEW BY REGION

In Brazil, we are experiencing an above average development including extremely interesting customer projects thatare now in planning. For this reason, we expect to see ourbusiness continue to develop positively.

Sales in the Asia-Pacific region continue to rise
The Asia-Pacific region continues to be of great importanceto our growth potential. With the improvement in living
standards in the emerging nations here, demand for our
products will continue to increase and thus the demand forthe appropriate internal logistics solutions. In 2014, salesrose by 7.3 % to CHF 19.0 million. Sales were CHF 17.7 million the year before and included a major one-time orderfrom Red Bull in Thailand that was worth roughly CHF 6.5

Inauguration of the new Asia headquarter in Shanghai by Dr. Ben
Xia, Executive Vice President Asia (middle) and Mike Wang, General
Manager Sales Interroll China (right)

million.
Compared to the same period of the previous year, ourIn addition, on 1 July 2014 we signed a definitive agreement

sales in China rose by approximately 61 %. And we are also

to acquire Pert Engineering in Shenzhen, China, which

seeing an extremely positive development in Japan andwill most likely be concluded by the beginning of AugustAustralia.

2014. The company is a market leader in Asia in the areaof belt curves and this will give us direct access to its exist-

Southeast Asia clearly failed to meet our expectations due toing customers, particularly in the area of express package

the fact that several projects were rescheduled. On the otherdeliveries and baggage handling systems.

hand, we received several highly promising inquiries fromIndonesia and the Philippines.

Shenzhen is our fourth site in China next to Suzhou,
Hong Kong and Shanghai and represents yet another con-

We continued to pursue our growth strategy in Asia-Pacificsequent execution of our strategy of offering our morein 2014. In March 2014, we celebrated the official opening

than 23,000 customers around the world our global productof our new Asian headquarters in Shanghai. Together withportfolio more quickly by strengthening our local manu­

the regional Center of Excellence in Suzhou, we will speed

facturing.

up Interroll’s expansion in China from here and offer our
Asian customers even better service. We expect the continued boom in market segments such as e-commerce andfood processing in China to result in a steady increase indemand in the area of internal logistics solutions. E-commerce sales in China have at least doubled over the last five
years to more than 1 trillion Yuan (circa CHF 145 billion)
in 2013.

14

INTERROLL GROUPSTATEMENT OF FINANCIAL POSITION

1FINANCIAL INTERIM STATEMENTS OF INTERROLL GROUP

1.1

CONSOLIDATED STATEMENT OF FINANCIAL POSITION

in thousands CHF

30.06.2014

in %31.12.2013

in %ASSETS
Property, plant and equipment

82,012

83,266

Intangible assets

49,57953,054

Financial assets

703

732

Deferred tax assets

3,642

Total non-current assets

135,936

Inventories

42,571

3,387
51.2

140,439

Current tax assets

1,040

706

Trade and other accounts receivable

68,042

58,164

Cash and cash equivalents

54.4

38,11917,934

20,797

Total current assets

129,58748.8

117,786

45.6

Total assets

265,523100.0

258,225

100.0

EQUITY AND LIABILITIESShare capital

8,540

8,540

Share premium

6,415

13,740Reserve for own shares–1,260–1,641

Translation reserve–46,092–45,454

Retained earnings

218,206

211,915

Non-controlling interests
Total equity

261
186,070145
70.1

187,245

Financial liabilities

253

Deferred tax liabilities

4,555

5,071

Pension liabilities

3,995

2,824

Provisions

6,106

Total non-current liabilities

14,909Financial liabilities

5,224

72.5

253

5,902
5.6

14,0505.4

320

Current tax liabilities

7,232

9,831

Trade and other accounts payable

52,08846,779Total current liabilities

64,54424.3

56,930Total liabilities

79,45329.9

70,98027.5

Total liabilities and equity

265,523100.0

258,225

100.0

22.1

15

CONSOLIDATED INCOME STATEMENT

1.2

INTERROLL GROUPCONSOLIDATED INCOME STATEMENT

Jan. – Jun.
2014

in %

Jan. – Jun.
2013

in %

Variancein %157,068

100.0

149,138

100.0

7,930

5.3

Material expenses–67,956–43.3–60,552–40.6

Personnel expenses–50,551–32.2–45,526–30.5–3,204–14.9–3,230–20.2–4,289–32.8

in thousands CHF

Net Sales

Increase / (Decrease) in work in progress,
Finished products and own goods capitalised

3,194

2.0

805

0.5

Other operating expenses–28,271–18.0–26,627–17.9

Other operating income

4,756

3.0

4,206

2.8

Operating result before depreciation andamortisation (EBITDA)

18,24011.6

21,444

14.4

Depreciation–5,471–3.5–5,445–3.7

Operating result before amortisation (EBITA)

12,7698.1

15,999

10.7

Amortisation–3,981–2.5–2,922–2.0

Operating result (EBIT)

8,788

5.6

13,077

8.8

Financing expenses

–220

–0.1

–476

–0.3

Financing income

371

0.2

47

0.0

Financing result

151

0.1

–429

–0.3

580

–135.2

Result before income taxes

8,939

5.7

12,6488.5–3,709–29.3

Income tax expense–1,793–1.1–2,102–1.4

Result7,146

4.5

10,546

7.1–3,400–32.2

10,546

7.1–3,516–33.3

Result attributable to:– Non-controlling interests– Owners of Interroll Holding Ltd.

116

0.1

7,030

4.5

Earnings per share (in CHF)

16

Non-diluted earnings per share

8.27

12.95

–4.68

–36.1

Diluted earnings per share

8.27

12.87

–4.60

–35.7

INTERROLL GROUP

1.3

CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOMECONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
Jan. – Jun.
2014

Jan. – Jun.
2013

7,146

10,546

Remeasurements of pension liabilities

–933

1,102

Income tax on items that will not be reclassified

185

–226

Total items that will not be reclassified to income statement

–748

876

–629

3,115

Total items that may be reclassified subsequently to income statement

–629

3,115

Other comprehensive income–1,377

3,991

Comprehensive income

5,769

14,537in thousands CHF
ResultOther comprehensive income
Items that will not be reclassified to income statement

Items that may be reclassified subsequently to income statement
Currency translation differences
Income tax on items that may be reclassified

Result attributable to:– Non-controlling interests– Owners of Interroll Holding Ltd.

116
5,653

14,537

17

CONSOLIDATED STATEMENT OF CASH FLOWS

1.4

INTERROLL GROUPCONSOLIDATED STATEMENT OF CASH FLOWS
Jan. – Jun.
2014

Jan. – Jun.
2013

Result7,146

10,546

Depreciation, amortisation and impairment

9,452

8,368

Loss / (gain) on disposal of tangible and intangible assets

–633

–14

Financing result

–151

429

in thousands CHF

Income taxes

1,793

2,102

Changes in inventories–3,962–8,269Changes in trade and other accounts receivable–10,670–2,657

Changes in trade and other accounts payable

5,483

9,188

Changes in provisions

329

567

–5,313–4,118Personnel expenses on share-based payments

926

899

Other non-cash (income)/expenses

626

524

Cash flow from operating activities

5,026

17,565Acquisition of property, plant and equipment–5,492–4,953Acquisition of intangible assets

–662

–979

Acquisition of financial assets

–18

–645

Proceeds from disposal of property, plant and equipment

1,074

129

Income taxes paid

Proceeds from disposal of intangible assets

2

Settlement of loans receivable

44

4Interests received

60

47–4,994–6,39532

11,170Distribution from reserves from capital contributions–7,494–6,520Acquisition of own shares–375

Cash flow from investing activities
Free cash flow

Disposal of own shares
Proceeds from financial liabilities

4,970

114

Repayment of financial liabilities

–52

–347

Interests paid
Cash flow from financing activities
Translation adjustment on cash and cash equivalents
Changes in cash and cash equivalent

18

4,418

–47

–70

–2,998–2,405103–63–2,863

8,702

Cash and cash equivalent at 1 January

20,797

14,109Cash and cash equivalent at 30 June

17,934

22,811INTERROLL GROUP

1.5

CONSOLIDATED STATEMENT OF CHANGES IN EQUIT YCONSOLIDATED STATEMENT OF CHANGES IN EQUIT Y

in thousands CHF
Balance at 1 January 2013SHARE
CAPITALSHARE
PREMIUM

RESERVEFOR OWN
SHARES

TRANSLATIONRESERVE

RETAINEDEARNINGS

8,540

20,427–17,670–44,319

190,659

157,637

10,546

10,546

ResultNONCONTROLLINGINTERESTSTOTAL EQUITYOther comprehensive
income, net of taxes

3,115

876

3,991

Comprehensive income

3,115

11,422

14,537

Distribution from reserves from
capital contributions–6,520Share-based payments–106

Sales of own shares incl. tax effects–6,520
1,005

899

–34

4,455

Balance at 30 June 2013

8,540

13,767–12,210–41,204

202,0814,421

Balance at 31 December 2013

8,540

13,740–1,641–45,463

211,924

145

187,245

7,030

116

7,146

ResultOther comprehensive
income, net of taxes

–629

–748

Comprehensive income

–629

6,282

Distribution from reserves from
capital contributions, net–1,377116–7,494

Share-based payments

169

Purchase of own shares incl. tax effects
Balance at 30 June 2014

170,974

8,540

6,415

5,769
–7,494

756

925

–375

–375

–1,260–46,092

218,206

261

186,070

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N O T E S T O T H E C O N S O L I D A T E D F I N A N C I A L I N T E R I M S T A T E M E N T S 

INTERROLL GROUP

2 NOTES TO THE CONSOLIDATED FINANCIAL
INTERIM STATEMENTS
2.1

BASIS OF THE CONSOLIDATED FINANCIAL STATEMENTS

Convention of preparation
The condensed, unaudited consolidated interim financial statements at 30 June 2014 have been preparedin accordance with IAS 34 («interim period») and are based on the uniform financial statements of Interroll
Holding LTD. and its subsidiaries («the Group»). All statements are prepared based on uniform Groupaccounting principles. This interim statement reflects an update of previously published information. Therefore, it should always be read in conjunction with the annual report 2013. The interim statements were­approved by the Board of Directors on 24 July 2014.
The Interroll Group has adopted the amendments of the IASB in the standards and interpretations (IAS 39,
IAS 32, IFRIC 21 and the annual improvement project) that came into effect at 1 January 2014. IAS 36 wasadopted early on at 1 January 2013. There was no significant impact on the disclosure and reporting of thisinterim statement from the adoption of the new and amended standards and interpretations.

Foreign currency translation
The following most important exchange rates were used for the translation of financial statements
denominated in foreign currencies:
INCOME STATEMENTBALANCE SHEET(AVERAGE RATES)(YEAR END RATES)

Jan. – Jun.
2014

Jan. – Jun.
2013

Change

1 EUR

1.219

1.229

–0.8

1 USD

0.889

0.938

–5.2

in %

31. Dec.
2013

Change

1.216

1.228

–1.0

0.890

0.890

0.0

30. Jun.
2014

in %

1 CAD

0.811

0.917

–11.6

0.833

0.837

–0.4

1 GBP

1.488

1.440

3.4

1.517

1.472

3.0

1 SGD

0.706

0.753

–6.2

0.713

0.705

1.1

1 CNY

0.144

0.152

–5.3

0.144

0.147

–2.4

1 PLZ

0.292

0.292

0.0

0.292

0.296

–1.0

1 THB

0.027

0.031

–13.1

0.027

0.027

0.7

1 ZAR

0.083

0.100

–17.0

0.084

0.084

–0.2

New or amended IAS/IFRS standards and interpretations
The IASB has published new and revised standards and interpretations. These come into force later than
1 July 2014 and are not early adopted in this financial statement. The impact of the introduction/amendment
of IFRS 9 (Financial Instruments), IFRS 11 (Joint Arrangements), IFRS 15 (Revenue Recognition) and IAS
19 (employee benefits) cannot yet be assessed with sufficient certainty or the expectations of the impact is inline with the disclosures made in the annual report 2013. Based on a first assessment, with the exception of
IFRS 15, the Group ­Management does not expect significant impacts on the consolidated financial statementsfrom these standards and interpretations.

20

I N T E R R O L L G R O U P N O T E S T O T H E C O N S O L I D A T E D F I N A N C I A L I N T E R I M S T A T E M E N T S

Critical accounting estimates and judgements
The preparation of the consolidated interim financial statements requires management to make estimates,
assumptions and judgements for the determination of income, expenses, assets, liabilities and for the disclosure of contingent liabilities. Such estimates, which are based on the management‘s best knowledge andbelief at the reporting date, may deviate from actual circumstances. In such a case, they will be modified
as appropriate in the period in which the circumstances change.

Segment reporting
The Interroll Group consists of one single business unit. The complete product range is sold in all markets
through the respective regional sales organisation. The customer groups being OEMs, system integratorsand endusers are taken care of by tailor-made product offerings and differentiated consulting levels. The
Interroll manufacturing units focus on the production of specific product ranges. Assembly units receivesemi-finished products from the manufacturing units and assemble a wide product range to serve their local
markets. The Interroll Research Center, which is centrally located, develops new application techno­logies
and new products for all product groups. Centers of Excellence which focus on specific product groups, concentrate on the development of their assigned product portfolio.
The Group Management and the whole Interroll management structure are organized by functions(Overall Management, Products & Technology, Global Sales & Services, Marketing and Finance). The financial m­ anagement of the Group by the Board of Directors is effected on one hand by turnover of the productgroups and geographical markets and on the other hand by the reporting of the consolidated financial­statements. The Group Management additionally assesses the achievement of financial and qualitative targetsof all legal entities.

Financial instruments
Interroll Group has only financial instruments classified as hierarchy 2 in line with IFRS 13. These financial
instruments include only foreign currency forward contracts. The valuation in hierarchy 2 is based on­factors which cannot be tracked to actively listed prices on public markets. Instead, they can be monitored
directly (as a price) or indirectly (as a derivative of the price). The amount of the financial instruments­classified as hierarchy 2 is CHF 0.0 million at 30 June 2014 (31 December 2013: CHF 0.2 million).

21N O T E S T O T H E C O N S O L I D A T E D F I N A N C I A L I N T E R I M S T A T E M E N T S 

2.2

INTERROLL GROUPSEGMENT INFORMATIONNet sales by geographical markets
Turnover by product groups according to geographical markets is presented as follows:
Jan. – Jun.
2014

in %

Jan. – Jun.
2013

in %

Other Europe, Middle East, Africa

73,412

46.7

68,306

45.8

Germany

25,77016.4

32,124

21.5

Switzerland

1,854

1.2

1,951

1.3

Total Europe, Middle East, Africa

101,03664.3

102,38168.6

USA30,12619.2

23,377

15.7

Other Americas

6,949

4.4

5,671

3.8

Total Americas

37,075

23.6

29,048

19.5

Asia incl. Australia

18,95712.1

17,70911.9

in thousands CHF

Total Asia-Pacific

18,95712.1

17,709

11.9

Total Group

157,068

100.0

149,138

100.0

Material turnover with specific customers
Turnover is realised with more than 10’000 active customers. There is no customer achieving a turnover ofmore than five per cent of Group sales.

Turnover by product group
Turnover realised in the first half year by product group is presented as follows:
Jan. – Jun.
2014

in %

Jan. – Jun.
2013

in %

Drives55,98835.7

54,59836.6

Rollers

39,39025.1

38,62325.9

Conveyors & Sorters

33,49821.3

26,06817.5

Pallet & Carton Flow

28,192

17.9

29,84920.0

Total Group

157,068

100.0

149,138

100.0

in thousands CHF

22

I N T E R R O L L G R O U P N O T E S T O T H E C O N S O L I D A T E D F I N A N C I A L I N T E R I M S T A T E M E N T S

2.3 NOTES TO THE CONSOLIDATED STATEMENT OFFINANCIAL POSITION
Consolidated statement of financial position
Total assets increased compared to year end 2013 by CHF 7.3 million. Particularly due to an increase in­accounts receivable, the net working capital increased by CHF 4.2 million to CHF 65.0 million. During theperiod under review trade and other accounts payable increased by CHF 5.3 million to CHF 52.1 million.

Investments / capital expenditures
Total CHF 6.2 million in gross capital expenditures were invested. Non-current assets reached CHF 135.9
million. Capital expenditure into ­intangible assets in essence are for the further development of SAP.
In line with IAS 36, goodwill and other intangible assets are subject to an annual impairment test. These
tests are normally performed in the second half of the year. Currently, no evidence exists for impairments.

Net financial assets
Net financial assets at end of the reporting period decreased by CHF 7.8 million compared to year end 2013
and reached CHF 12.5 million by 30 June 2014.
Total credit lines available at end of the reporting period amount to CHF 79.4 million, of which
CHF 74.2 million remain unused (end of 2013: CHF 80.6 million). From these credit lines, CHF 40.0 million
are committed until first half 2015.
The debt covenants that have not been changed since year end 2013 have always been complied with during
the interim period as well as during the previous year period.

EquityEquity decreased by CHF 1.2 million to CHF 186.1 million compared to the previous year end. The distri­bution of reserves from capital contributions of net CHF 7.5 million took place on 17 May 2014 and has been
debited accordingly to the equity. The equity ratio at end of the interim period corresponds to 70.1 % (yearend 2013: 72.5 %).

23

N O T E S T O T H E C O N S O L I D A T E D F I N A N C I A L I N T E R I M S T A T E M E N T S 

2.4

INTERROLL GROUPNOTES TO THE CONSOLIDATED INCOME STATEMENT

Net sales
Net sales in reporting currency have increased by 5.3 % to CHF 157.1 million compared to the previous
year‘s period. Excluding negative foreign currency effects of 3.8 % the increase would have been 9.1 % in local currencies. About half of the increase is driven by the Portec acquisition. On the one hand side, the negative currency effects result from dollar areas (mainly USA, Canada and Australia) and on the other handside from emerging market countries (mainly Turkey, South Africa, Thailand and Brasil). O­ rganic growth
expressed in local currency reached 4.2 %.

Earnings before interest and taxes (EBIT)
The development of the new modular conveyor platform in Germany and the reorganisation of Interroll
companies in North America (USA and Canada) led to one time costs and a decrease of the operating profit.
EBITDA decreased by 14.9% to CHF 18.2 million (previous year: CHF 21.4 million). EBIT decreased by
32.8% and reached CHF 8.8 million (previous year: CHF 13.1 million). Increased amortisation compared toprevious year results from the increased number of entities working with the ERP platform SAP and theacquisition of patents and customer values related to the Portec acquisition.

Financing result and income tax expense
Net financial expenses of CHF 0.2 million include net financial interest expenses as well as foreign exchange
losses. Net financial income of CHF 0.4 million include net financial interest income and foreign currency
valuation effects. Due to its decentralised structure, the Interroll Group is generally not much exposed tocurrency fluctuations.

Financial result and income tax expense
Income tax expense is recognised based upon the best estimates of the weighted average annual income
tax rate for the full financial year. The tax rate presented in the interim report generally contains tax recoveries / adjustment charges from previous years. It is also influenced by distinguished assessment of future­realisable losses carried forward. In the period under review tax charges resulting from previous periods wereincurred of CHF 1.1 million (previous year: CHF 0.5 million).

Result
The net profit presented for the reporting period amounts to CHF 7.1 million(previous year: CHF 10.5 million).

24

I N T E R R O L L G R O U P N O T E S T O T H E C O N S O L I D A T E D F I N A N C I A L I N T E R I M S T A T E M E N T S

2.5 NOTES TO THE CONSOLIDATED STATEMENT OF
CASH FLOWSCash flow from operating activities
The cash flow from operating activities amounts to CHF 5.0 million (previous year: CHF 17.6 million).

Cash flow from investing activities
For investments into buildings, machinery and the SAP ERP system CHF 6.2 million were spent before thesale of certain business activities in the USA, compared to net CHF 5.9 million last year. At 28 February
2014 the business activities of Interroll Dynamic Storage Inc. in Hiram/Atlanta (USA) were sold for USD 1.1
million to the local management. The net profit from this business was not material on the Interroll groupresults.

Cash flow from financing activities
The payment from reserves from capital contribution for the net amount of CHF 7.5 million was processedon 17 May 2014 and is therefore included in the cash flow statement.

2.6 NOTES TO THE CONSOLIDATED STATEMENT OFCHANGES IN EQUIT Y
Capital contributions
The decision of the ordinary general shareholder meeting from 9 May 2014 to distribute CHF 8.80 per sharefrom reserves from capital contributions was executed on 17 May 2014.

Assignment of shares
Shares assigned to members of the management in the amount of CHF 0.9 million(previous year: CHF 0.9 million) were expensed.

25

N O T E S T O T H E C O N S O L I D A T E D F I N A N C I A L I N T E R I M S T A T E M E N T S 

3

INTERROLL GROUPFURTHER DISCLOSURES AND INFORMATION

Events after the balance sheet date, seasonality
The Group did not identify any events after the closing date of the interim statement that would have a­material effect on the presentation of its financial position as at 30 June 2014. There are no other facts which
require disclosure according to IAS 34.
The industry in which the Group operates does not have significant seasonal variations. However, the current difficult economical environment could have an impact on the short-term profitability.

Changes to the scope of consolidation in July 2014
Acquisitions
On 2 July 2014, the purchase agreement to acquire a 40 % minority of Portec Asia in Hong Kong and at the
beginning of August 2014 the purchase agreement to acquire a 100 % stake in Pert Engineering in Shenzhen(PRC) became effective. Interroll thus has new 100 % on the sales company for belt curves in Hong Kong.
The manufacturing company in Shenzhen is one of the industry’s leading belt curve manufacturers in AsiaPacific, in particular for airports, distribution centers, as well as courier and postal services. Portec Asia was
fully consolidated due to a 60 % majority stake of Interroll since July 2013. Pert Engineering achieved salesof approximately USD 4 million in 2013. Previous owner of the mentioned companies was the Pert Group,
headquartered in Hong Kong. The purchase price for the 40 % minority of Portec Asia and the 100 % stakein Shenzhen Pert together is USD 2.6 million. The Interroll Group is currently in the process to prepare
the opening balance and the purchase price allocation. Therefore, the Group does not disclose the opening­balance and purchase price allocation for the mid-year report.

Contingent liabilities
There were no contingent liabilities in the period under review.

26



FINANZK ALENDER | KONTAKTFINANCIAL CALENDAR 2015
Preliminary Financial Figures 2014

23 January 2015

Publication Annual Report 2014 and Balance Sheet Press Conference

20 March 2015

Annual General Assembly

8 May 2015

Publication Half-Year Report 2015

7 August 2015

IMPRINTCONTACT

Editor:If you have any questions regarding

Interroll Holding Ltd.

Interroll Group or would like to be in-

Via Gorelle 3

cluded in our distribution list, please6592 Sant’Antonino, Switzerland

contact the Investor Relations Team:

Phone: +41 91 850 25 25
Fax: +41 91 850 25 05

Investor.relations@interroll.com

Concept and design:

Petra Müller

Interroll (Schweiz) AG

Head of PR & Investor Relations
Phone: +41 91 850 25 21

Layout & DTP financial section:

E-Mail: p.mueller@interroll.com

Mondays Modern Media,
Steinhausen (CH)

Note on the half year report
This half year report is also available in German. If there are differences between the two, the German version takes priority.
Note on rounding
Please note that slight differences may arise as a result of the use of rounded amounts and percentages.
Forward-looking statements
This half year report contains certain future-oriented statements. Future-oriented statements include all statements which do not relate to historical facts
and events and contain future-oriented expressions such as “believe”, “estimate”, “assume”, “expect”, “forecast”, “intend”, “could” or “should” or expressions ofa similar kind. Such future-oriented statements are subject to risks and uncertainties since they relate to future events and are based on the company’s current assumptions, which may not in the future take place or be fulfilled as expected. The company points out that such future-oriented statements provide
no guarantee for the future and that the actual events including the financial position and profitability of the Interroll Group and developments in the economic and regulatory fundamentals may vary substantially (particularly on the down side) from those explicitly or implicitly assumed in these statements.
Even if the actual assets for the Interroll Group, including its financial position and profitability and the economic and regulatory fundamentals, are in accordance with such future-oriented statements in this half year report, no guarantee can be given that this will continue to be the case in the future.

27

Interroll Holding Ltd.
Via Gorelle 3 | 6592 Sant’Antonino | Switzerland© Interroll Holding AG

www.interroll.com