ANNUAL REPORT 2015

INSPIRED
BY EFFICIENCY360.7 MILLIONNET SALES
39.8 MILLION
EBIT
40.2 MILLION
CASH FLOW1_INT_GB2015_Imageteil_Inhalt_EN.indd 1

ANNUAL REVIEW	2

REPORT BY THE BOARD OF DIRECTORSAND GROUP MANAGEMENT4

GROUP MANAGEMENT6

INTERROLL ON THE CAPITAL MARKET8OVERVIEW10

OUR BUSINESS10

INTEVIEW PAUL ZUMBÜHL12

OVERVIEW OF FINANCIAL POSITION, EARNINGS
AND CASH FLOWS14

OVERVIEW BY PRODUCT GROUPS16

OVERVIEW BY REGION

22

INTERVIEW DR. BEN XIA AND TIM MCGILL

26

CORPORATE RESPONSIBILITY

30

INNOVATION

34

MODULAR CONVEYOR PLATFORM

36

SORTER AND CONVEYOR TECHNOLOGY38

CORPORATE GOVERNANCE41

REMUNERATION REPORT

51

FINANCIAL STATEMENTS OF INTERROLL GROUP

59

FINANCIAL STATEMENTS OF INTERROLL HOLDING LTD.

113

04.03.16 16:18

KEY
FIGURESin CHF million, if not stated differently

2015

2014

2013

2012

2011

385.1

350.7

318.8

302.6

288.7

Order intake / net sales
Total order intake
Rollers

93.4

81.2

75.4

80.4

83.2

Drives

110.3

114.9

109.4

99.3

95.1

Conveyors & Sorters

107.2

79.8

71.2

69.3

42.8

Pallet & Carton Flow

49.8

59.4

60.3

58.1

50.8

Total net sales

360.7

335.3

316.3

307.2

271.9

EBITDA

58.2

44.1

45.4

41.1

36.2

in % of net sales

16.1

13.2

14.3

13.4

13.3

EBITA

47.6

33.2

34.0

30.3

25.7

in % of net sales

13.2

9.9

10.7

9.9

9.5

EBIT

39.8

25.4

27.2

24.8

20.4

Profitability

in % of net sales

11.0

7.6

8.6

8.1

7.5

Result

29.3

19.1

20.5

19.4

18.2

in % of net sales

8.1

5.7

6.5

6.3

6.7

Operating cash flow

40.2

27.8

44.5

38.2

14.5

in % of net sales

11.1

8.3

14.1

12.4

5.3

Free cash flow

17.3

12.0

5.0

30.2

–5.6

Cash flowin % of net sales

4.8

3.6

1.6

9.8

–2.1

Total investments / capital expenditure

24.3

16.8

39.8

10.6

19.6

Total assets

293.0

278.2

258.2

227.6

239.2

Goodwill

16.7

17.6

16.0

9.0

9.0

Net financial assets (debts)

31.3

23.9

20.2

8.7

–17.6

Balance sheet (31.12.)

Gearing (net debt / equity)

0.12

Indebtedness factor (net debt / cash flow)

1.21

Equity

207.6

200.3

187.2

157.6

143.3

Equity ratio (equity in % of assets)

70.9

72.0

72.5

69.3

59.9

Return on equity (in %)

14.4

9.9

11.9

12.8

13.4

Other key figures
RONA (Return on Net Assets, in %)

15.3

9.8

12.2

12.6

9.9

Average number of employees

1,820

1,675

1,488

1,420

1,340

Net sales per employee (in thousands CHF)

198

200

213

216

203

Productivity (added value / total personnel expenses)

2.04

1.86

1.95

1.92

1.77

ABOUT
INTERROLL
Interroll Group is a worldwide leading provider of high-quality key products and services for internal ­logistics.
The company offers a broad product range in the four product groups “Rollers”, “Drives”, “Conveyors & S­ orters” and“Pallet & Carton Flow” to around 23,000 customers around the world.
Core industries are courier, parcel, express and postal services, airports, food processing as well as distribution­centers. Our products are in daily use at well-known brands such as Amazon, Bosch, ­Coca-Cola, Coop, DHL,
FedEx, Peugeot, PepsiCo, Procter & Gamble, Siemens, Walmart and Yamaha, amongst others.
Interroll is engaged in global research projects on logistics efficiency and actively supports industry associations
in developing standards. Headquartered in Sant’Antonino, Switzerland, Interroll operates a worldwide networkof about 30 companies with around 1,900 employees. The company was founded in 1959. Since 1997, Interroll
Group has been listed on the SIX Swiss Exchange and included in the SPI.
www.interroll.com

INTERROLL HEADQUARTERS IN SANT’ANTONINOREVIEW OF THE YEAR2

HIGHLIGHTS OF THE
FINANCIAL YEAR 2015

INTERROLL INTRODUCES“ROLLING ON INTERROLL”
COMMUNITY
The program is aimed at defined customers with which­Interroll has a long-term relationship and where our products
are mission-critical.
FRANCEPROBIA Ingénierie installs two crossbelt sorters at a French
food processing company.
GERMANY
Hermes Fulfilment reduces energy consumption thanks to­Interroll RollerDrive.

Q1
1_INT_GB2015_Imageteil_Inhalt_EN.indd 2

INTERROLL EXPANDS ITSCONTROLLER FAMILY
MULTICONTROLInterroll expands its controller family to include MultiControl.
BRAZILThe total order placed by Brazil Post includes 10 sorters plus
the respective conveyor technology.
AWARD
Ben Xia, Head of Interroll Asia, Named “Person of the Year in
China’s Logistics Sector”.
ITALYInterroll flow storage forms the heart of Prix Quality’s new
main warehouse, the warehouse with the third largest storage
capacity in Italy.

Q2
04.03.16 16:18

REVIEW OF THE YEAR

3

HESSNATUR RELIES ON
INTERROLL ROLLERDRIVEGERMANY
Hessnatur relies on energy-efficient Interroll RollerDrivefor greater sustainability.
CHINA
Nongshim Engineering contracts Interroll to supply
a complete set of Pallet Flow modules and safety equipment
for the Baeksansu distribution center.

NEW HUB FOR R&D AND
INTERROLL ACADEMYGERMANYInterroll opens its academy covering an area of 2,200 square
meters as well as the Interroll Research Center (IRC) withan area of 3,400 square meters.
USA
Interroll upgrades its Canon City production site to be the global
Center of Excellence for Interroll Portec belt curves.

ITALY
Interroll announces its cooperation with the Faculty of­Nutritional sciences of the University of Parma.

CHINA
Interroll presents its new modular conveyor platform for internal
logistics at CeMAT Asia (Shanghai).

Q3

Q4

1_INT_GB2015_Imageteil_Inhalt_EN.indd 3

04.03.16 16:18

REPORT BY THE BOARD OF DIRECTORS AND GROUP MANAGEMENT

4

incurred in the reporting year 2015, a significant
improvement in productivity and significantly higher
sales led to a net profit of CHF 29.3 million (previous
year: CHF 19.1 million). This represents an increaseof 53.7 %.

WE SUCCESSFULLY
IMPLEMENTED OUR GLOBALGROWTH STRATEGYONCE AGAIN IN 2015

Dear Shareholders, Employees,
Customers and Business Partners,
Interroll closed financial year 2015 with significant
growth rates in order intake, sales and profit. All regions
developed very well. The distribution of revenue in thethree regions has continued to improve, and we are
generating an increasing share of sales outside Europe.
Demand for our products is high worldwide. We
have never sold so many conveyor rollers in a single
financial year. The follow-up order for four additionalcross belt sorters for the Brazilian Post in April 2015
subsequent to the initial order we received in November 2014 is yet another example of how our solutions
are being well accepted in the market and how thename Interroll stands for quality and reliability.
Our order intake has increased from CHF 350.7 million in 2014 to CHF 385.1 million in 2015. We werethus able to post the highest order intake in the history of Interroll. Sales in local currency increased by
15.9 %. At CHF 360.7 million, consolidated sales were
7.6 % higher than in 2014 (CHF 335.3 million). Our
EBITDA increased by 32.0 % from CHF 44.1 million
to CHF 58.2 million. The EBITDA margin of 16.1 %was higher than in the previous year (13.2 %). EBIT
of CHF 39.8 million in 2015 rose by 56.8 % comparedto the same period in the previous year (CHF 25.4
­million). The EBIT margin reached 11.0 % (previous
year: 7.6 %).
We reported in our 2014 Annual Report in detail on
our strategic non-recurring expenses in 2014. The factthat these non-recurring expenses were no longer

1_INT_GB2015_Imageteil_Inhalt_EN.indd 4

We have been rolling out our new modular conveyor
platform, which we successfully launched in the European markets in May 2014 and in the Asian markets
in the fourth quarter of 2015. This innovative solution
met with great interest among system integrators andequipment manufacturers at CeMAT Asia in Shanghai.
Since the product was launched in Europe, we haveobtained very interesting orders, and our production
at the global Center of Excellence in Sinsheim, Germany, is already operating in two shifts to promptly
meet the strong demand in Europe.
With the acquisition of the leading manufacturer ofbelt curves in the USA, Portec, we expanded our global
product line in the area of highly efficient belt curves
and other conveyor solutions back in 2013. We havebeen manufacturing and marketing this reliable androbust solution, which has already been installed over
80,000 times worldwide, including Europe, since 2015.
We will thus be able to offer our customers in thisregion even faster delivery of this proven solution in
the future.
The Portec site in Cañon City, Colorado, has been
expanded into a global Center of Excellence for belt
curves. Since the acquisition, we have continued toinvest in the site, modernised the entire production­process and implemented the Interroll Production­System (IPS).
We have also invested heavily in the site in Shenzhen,
China, since the acquisition of Pert Engineering in
2014. Here, too, the Interroll Production System wasintroduced and measures aimed at improving working conditions were implemented. By installing an
automatic belt cutting system and a laser machining
center for steel parts and achieving the associated timesavings in production, we have been able to reduce thedelivery time to the customer quite significantly. All ofthese measures and investments have already resulted
in an increase in output of around 80 % in the current
fiscal year, using the same production area.
Construction of the new building in Baal / Hückelhoven,
Germany, was completed in the fourth quarter of 2015.
The Academy and the Research Center have now been
united there under one roof. We are thus optimising
our own internal logistics. Development and production are now more strongly interlinked. The Interroll
Academy will serve as the center of education andtraining for our employees and partners, and the04.03.16 16:18

REPORT BY THE BOARD OF DIRECTORS AND GROUP MANAGEMENT

5Development Center has been significantly expanded
and now offers even more space for long-term tests ofour products.
Our programme “Rolling On Interroll”, which welaunched this year, has already been introduced with30 customers whom we have selected from all over theworld. System integrators and system builders from
21 countries have now joined this loyalty programmeand display the specially designed emblem on theirmachine in order to express that they rely on theexpertise and quality products Interroll offers.

“Interroll has increased
its sales and productivity
quite significantly.”

Our continuously good performance is also reflected in
the performance of our share, which rose by 63.0 % in2015. The share price of Interroll stood at CHF 856.50
on 31 December 2015. Due to our good net profit of
CHF 29.3 million, we will be proposing to you, ourshareholders, a dividend of CHF 12.00 per share forfinancial year 2015 at the General Meeting to be heldon 13 May 2016.
We want to strengthen and expand our leading market and technology position worldwide again in 2016.
With our platform strategy, we offer our customers
optimally matched solutions of the highest quality
and fast availability. Interroll is very well prepared,
thanks to the global availability of our products, ourproven quality and short delivery times, but also considering the ever-­progressing globalisation of markets. In 2016, we will also establish another sales basein Mexico to serve the rapidly growing market forinternal logistics locally.
Our corporate culture is geared towards growth. We
implemented our internal programme “Culture for
Growth” in 2015 and our managers are improving
their skills through various training programmes andpreparing for the coming challenges. Our basic idea
“Inspired by Efficiency” is being infused into the whole
global Interroll organisation more deeply.
We thank all our employees for the great commitment with which they have contributed to the positive
development of Interroll. We also thank our customers, suppliers, investors and, of course, you, our dearshareholders, for your trust in our company.
Sant’Antonino, 18 March 2016

Kurt Rudolf
Chairman of the Boardof Directors

Paul Zumbühl
CEOPaul Zumbühl (left)
CEO
Kurt Rudolf (right)
Chairman of the Board of Directors

1_INT_GB2015_Imageteil_Inhalt_EN.indd 5

04.03.16 16:18

GROUP MANAGEMENT

6

GROUP
MANAGEMENT
From left to right
Daniel Bättig
Chief Financial Officer (CFO)Paul Zumbühl
Chief Executive Officer (CEO)Tim McGill
Executive Vice President Americas

Dr. Ralf Garlichs
Executive Vice President Products & Technology

Jens Karolyi
Senior Vice President
Corporate Marketing & Culture

Dr. Ben Xia
Executive Vice President Asia

Dr. Christoph Reinkemeier
Executive Vice President Global Sales & Service

1_INT_GB2015_Imageteil_Inhalt_EN.indd 6

04.03.16 16:19

GROUP MANAGEMENT

7

PROFESSIONAL BACKGROUND AND VESTED INTERESTS
OF THE GROUP MANAGEMENTPAUL ZUMBÜHLJENS KAROLYI(born 1957, Swiss)(born 1970, German)

Paul Zumbühl studied engineering sciences at the University ofApplied Sciences Lucerne, Switzerland, and holds a degree as
Dipl.-Ing. He also holds an MBA from the Joint University­Program of the universities of Boston, Berne and Shanghai. He
participated in an AMP at the Kellogg Business School ofNorthwestern University, Evanston / Chicago and holds a Swiss
Federal Marketing Management Diploma (Eidg. Dipl.) After
working for Symalit AG as Sales Manager / Engineer, he held
several management positions and was Managing Director of
Sarna Group. From 1994 until 1999 he was the CEO of Mikron
Plastics Technology and a member of the Executive Management Board of Mikron Group. In January 2000 he joined theInterroll Group Management as Chief Executive Officer (CEO).
Paul Zumbühl is a member of the Board of Directors with thelisted Swiss companies Looser Holding AG and Schlatter Holding AG as well as a member of the Industry Executive Advisory
Board for the «Executive MBA Supply Chain Management»with ETH, Zurich, Switzerland.

Jens Karolyi studied business administration at the Universities
of Bamberg and Giessen, Germany. He started his ­career with
Ericsson, where he held various management positions in Marketing, Branding and Communications and was based in­Stockholm, Zurich and Düsseldorf. In 2007 he was promoted
to Vice President Marketing & Communications Northern­Europe. In 2011 he joined Interroll Group as Vice President
Corporate Marketing and member of the Interroll Group Management. In February 2015 he took over additional responsibilities as Senior Vice President Corporate Marketing & Culture.

DANIEL BÄTTIG
(born 1964, Swiss)
Daniel Bättig holds an Executive MBA from the Graduate
School of Business Administration (GSBA), Zurich, Switzer­land and a Bachelor in Business Economics from the Fach­hochschule Nordwestschweiz (FHNW), Olten, Switzerland.
Furthermore, he is a Certified Public Accountant with the Swiss
Institute of Certified Accountants and Tax Consultants. At thestart of his career he held various positions in finance ­with
Von Roll Holding AG in Switzerland, Brazil and the USA.
­After working for Südelektra Holding AG as the Group Chief
Accountant he joined the Executive Management Board of
Swiss Post International as CFO and later served as Head ofInternational Mail. Since 2013 he has been the Chief Financial
Officer (CFO) of ­Interroll Holding AG and a member of theInterroll Group ­Management.

DR. RALF GARLICHS(born 1962, German)
Dr. Ralf Garlichs studied mechanical engineering with a focus
on production engineering at the University of Hanover, Germany, and holds a PhD degree (Dr.-Ing.). After working for
Festo Tooltechnic as Head of Production and Logistics hejoined the Winkelmann Group where he held several management positions. He joined Interroll Group in 2006 as Executive
Vice President “Drives & Rollers.” Since 2011 Ralf Garlichs has
been Executive Vice President Products & Technology and amember of the Interroll Group Management.

1_INT_GB2015_Imageteil_Inhalt_EN.indd 7

TIM MCGILL(born 1955, British)
Tim McGill majored in English literature at the Brockenhurst
College in Hampshire, Great Britain. He joined Interroll­Canada in 1990 as Sales Director having previously been employed by Brammer, Europe’s leading supplier of quality industrial maintenance, repair and overhaul products in a seriesof roles with increasing management responsibility. After
having been President of Werner Precision Rollers Canada for
one year, he rejoined Interroll in 1996 as President of Interroll
Canada. He was promoted to Head of ­Interroll Dynamic Storage North America in 2000. Since 2011 he has been acting as
Executive Vice President Americas and is a member of Interroll Group Management.

DR. CHRISTOPH REINKEMEIER(born 1966, German)
Dr. Christoph Reinkemeier studied business administration
with a focus on industrial marketing at the University of­Münster, Germany, and holds a PhD degree (Dr. rer. pol.).
After working for E.On AG as Project Manager of corporate­development he held several management positions at Ista
­International ­GmbH. From 2007 to 2010 he was CEO for Northand South America at Deckel Maho Gildemeister (DMG)
America Inc. In 2011 he joined Interroll Group as Executive
Vice President Global Sales & Service and member of ­Interroll
Group ­Management.

DR. BEN XIA(born 1966, Chinese)
Dr. Ben Xia, graduated as B.Sc. in electrical ­engineering at the
Shanghai Jiaotong University, China. Further on, he studied
electrical machinery at the Moscow Power Engineering Institute, Russia, and holds a PhD degree in electrical engineering(Dr.-Ing.). He also passed the Advanced Management Programme for Senior Executives at the China Europe ­International
Business School (CEIBS) in Shanghai, China. After working for
Pirelli Cables Asia-Pacific as Marketing Manager, he held positions as General Manager of Shanghai Citel Electronics Co. Ltd.
and Managing Director of Vanderlande Industries North Asia.
In 2013 he joined Interroll Group as Executive Vice President
Asia and member of Interroll Group Management.

04.03.16 16:19

INTERROLL ON THE CAPITAL MARKET

8

INTERROLL ON
THE CAPITAL MARKETINVESTOR INFORMATIONInterroll share information

2015

2014

2013

2012

2011

Number of registered shares

854,000

854,000

854,000

854,000

854,000

Number of average outstanding shares

849,155

849,170

826,920

799,090

791,452

Number of outstanding shares as of 31.12.

851,015

849,830

850,151

802,282

793,901
450.00Share price highCHF

858.00582.50490.00360.00Share price low

CHF

429.00490.00333.00270.00271.00Year-end share price as of 31.12.

CHF

856.50525.50490.00333.00279.00Market capitalization as of 31.12.

CHF million

731.45448.78416.57267.16221.50

10.00

10.00

10.00

10.00

Par value as of 31.12.

CHF

1.00

Dividend

CHF

12.00

Reduction of par value

CHF

Distribution out of reserves from capital contributions

CHF

Earnings per average share outstanding

CHF

9.00
8.80

8.00

7.00

34.51

22.45

24.84

24.25

22.99

Pay out ratio

34.78

40.09

35.43

32.98

30.45

P/E Ratio

25.00

23.41

19.73

13.72

12.14

Cash flow per average share outstanding

CHF

47.33

32.69

53.79

47.78

18.34

Equity per share outstanding as of 31.12.

CHF

243.94235.73220.25

198.64180.48

IPO: 1997 | Stock Exchange: SIX Swiss Exchange |Market segment: Main Standard | Index: SPI
ISIN: CH0006372897 | Security identification symbol: INRN |Security identification number: 637289

Share price performance Interroll relative
to Swiss Performance Index SPI in 2015
80 %
856
CHF

60 %

40 %

20 %
Interroll share
Share price as of 30.12.2014: CHF 525.50
Share price as of 30.12.2015: CHF 856.50
Swiss Performance Index (SPI)

0%

525
CHF

–20 %
Jan.

Feb.

Mar.

Apr.

May

Jun.

Jul.

Aug.

Sep.

Oct.

Nov.

Dec.

© Swissquote

1_INT_GB2015_Imageteil_Inhalt_EN.indd 8

04.03.16 16:19

INTERROLL ON THE CAPITAL MARKET

9

SWISS STOCK MARKETS CHARACTERIZEDBY HIGH VOLATILITY
The performance of the stock markets in Switzerland in the first half of 2015 was distinguished by the
SNB’s (Swiss National Bank) decision to abandon the
euro-franc exchange rate ceiling as well as the uncertain ­situation in Greece and the Ukraine crisis. Aftersignifi­cant losses due to the mentioned SNB decision,
the Swiss markets recovered overall in the second halfof 2015.

Shareholder structure in %as at 31 December 2015

POSITIVE DEVELOPMENT OF THE
INTERROLL SHAREThe Interroll share showed a further strong upward
trend in 2015 and reached the price of CHF 856.50,
the highest year end closing value ever measured
since the company went public in 1997. This represents an increase of 63.0 % over the price at year end
closing 2014 of CHF 525.50. With this performancethe ­Interroll share ranked among the top 10 winners
in the Swiss Performance Index (SPI) in 2015 andtopped this index, which achieved an increase of 2.9 %over year end closing 2014.
STABLE SHAREHOLDER STRUCTURE
Around 22 % of Interroll shares are held by the founding family Specht and another main s­hareholder. As
of 31 December 2015, the shareholding of Group­Management and their relatives reached 2.7 %. Information about significant shareholders can be found on
page 118. Based on the SIX definition, the company’s
free float is around 78 %.
Market capitalisation of Interroll Holding AG reached
a new record value of CHF 731.5 million as per
30 December 2015.

Fixed shareholding 22 %Free float 78 %Geographical distribution of theidentified shareholder base as per shareregister in % as at 31 December 2015

ACTIVE INVESTOR RELATIONS WORK
IN SWITZERLAND AND ABROAD
In 2015 Interroll also continued ongoing communication with institutional investors, private investors
and analysts in Switzerland and abroad in order tostrengthen and further develop the perception of theInterroll share as an attractive growth stock: The entire
business model of Interroll is consequently geared tosustainable, global growth.
We publish information relating to the Interroll shareon our website www.interroll.com. Financial reports,
presentations and other documents are available fordownloading. Interested parties can register for our
mailing list or request our standard publications. All
key financial market data is published there as well.

Switzerland 59 % EMEA region excluding Switzerland 39 %Rest of the world 2 %1_INT_GB2015_Imageteil_Inhalt_EN.indd 904.03.16 16:19

OUR BUSINESS

10THE BUSINESS MODEL OF ­INTERROLL IS ORIENTED TOWARDSSUSTAINABLE GLOBAL GROWTHPRODUCT PLATFORMS, KEY MARKETS AND
MARKET TRENDS
As a leader in innovation and technology, Interroll
stands for high-quality key products and services ininternal logistics worldwide. Our customer solutions
for daily logistical challenges are based on globally
available product platforms which are focused on:

The company supplies more than 23,000 customers
worldwide. In the key markets, these mainly include
regionally oriented plant manufacturers, OEMs andglobal system integrators:

1_INT_GB2015_Imageteil_Inhalt_EN.indd 10

Further global growth of the Interroll Group focuses
on clearly identifiable market trends that have not only
shown sales potential thus far, but will continue toshow such potential in the future:–– The steadily growing passenger traffic in international air travel and the related expansion of airport
capacity and security technology for passenger andluggage transport.
–– The global e-commerce boom as well as the liberalization and regionalization in the courier, express
and parcel markets.
–– The stringent hygiene regulations in the foodindustry that are being adopted by an increasing
number of countries, and the use of high-quality
solutions that meet the legal requirements (such as
drum motors as a conveyor drive).
–– The decentralization of distribution centers inorder to shorten delivery times.
–– Increasing product variety and the shortened­production life cycles require increased flexibility
and individualization when commissioning
goods in the flow of materials.
–– Demand for material flow plants with better returnon investment.
–– Increased productivity in the industry andthe related rise in efficiency in storage systems.

04.03.16 16:19

OUR BUSINESS

11

ORGANIZATION, STRATEGY AND
SUCCESS FACTORSThe Interroll Group consists of a single business unit.
All products are sold in all markets via the respective
regional sales companies, whereby the specific requirements of the customer groups plant manufacturers,
OEMs, system integrators as well as end customers are
met with a tailor-fit variety of products and advising.
The Interroll Academy is responsible for excellent
training and professional development of all employees of the Interroll Group worldwide. It will also begin
offering training and courses for customers in 2016.
The Interroll Research Center (IRC) develops new
products, processes and technologies. The production
plants concentrate as a global competence center(Centers of Excellence) on the development and the
manufacture of specific product groups. In order toquickly meet customer needs in all parts of the world,
regional production centers (Regional Centers of
Excellence) have been built which are under the direction of the competence centers. Assembly plants (local
assembly) are supplied by production plants withsemi-finished products and assemble products for theindividual, local market.

The success of Interroll to date and into the future isbased on the following factors:–– The concentration of resources on key products,
solutions and services through which global market
leadership can be maintained in the longer term.
–– The development and expansion of application-­oriented product platforms according to a modular
principle, which increases flexibility and quality
for the customer and makes possible significant
economies of scale within the Group.
–– The global sales network with local sales sub­sidiaries that quickly recognize customer needs
and market trends and can tap market potential
worldwide.
–– The group-wide, uniform production technologies at all production facilities, supported by the­Interroll Production System (IPS).
–– The quality standards for the products that are
identical worldwide and the zero-error strategy.
–– The worldwide networking of Interroll Group­companies via the uniform SAP system.
–– Its own permanent development and the quick
launch of new products onto the market.
–– The support, training and professional developmentof all employees worldwide.

The Interroll Group strives for a position of market
leadership in its key products, solutions and services
worldwide. An important element of this strategy istherefore the permanent, continued development andredevelopment of intelligent products that enable thecustomers to save space and energy and secure a quick
return on investment. It has the following technological makeup in this regard:

Organization of our competences worldwide

Canada: Local AssemblyInterroll Research Center (D)USA: RCoE Atlanta

Global Centers of Excellence (CoE)Know-how

USA: RCoE Wilmington

Rollers (D)Drum Motors (D)Know-how

China: RCoE Suzhou
China: RCoE Shenzhen

Supermarket Solutions (DK)
Conveyors & Sorters (D)Belt Curves (USA)Brazil: Local Assembly

Flow Storage Systems (F)Thailand: Local AssemblyTechnopolymers (CH)

RCoE: Regional Centers of Excellence

1_INT_GB2015_Imageteil_Inhalt_EN.indd 11

04.03.16 16:19

INTERVIEW

12COMPANY ACQUISITIONSARE MADE AT THE
TOP MANAGEMENT LEVELInterview with
PAUL ZUMBÜHL
Chief Executive Officer (CEO)In the summer of 2013, Interroll announced theacquisition of Portec, Inc. in the USA. This decision and the subsequent, successful integrationof the US company contributed substantially tothe increase in the value of the Swiss technology­company. A conversation with Paul Zumbühl, theCEO of the Interroll Group, about entrepreneurial
strategies, pitfalls and success factors in the purchase of companies.
Mr. Zumbühl, Interroll has been on a sustained
path of growth for years. In fiscal year 2015,
sales and net profit again increased by 7.6 % and53.7 %. What role does the completed acquisition of ­Portec, Inc. play in this?
First, I am happy to see that the engagement andcompetence of our 1,900 employees have again won
over our customers across the world. We have notjust demonstrated a great commitment, we have also
continuously improved over the recent years in many
areas. The integration of Portec is only one important
example of how we have realized a sustained path ofgrowth. We have succeeded in tapping the potentialof this purchase in 2013 as planned.

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International studies have shown thatup to two thirds of all mergers or acquisitions
ultimately destroy value.
These assessments are not surprising. Ultimately, thesuccess of company acquisitions depends on a number of critical factors. There are many pitfalls along
this path. To avoid these hazards, experience andextensive industry knowledge are important; only inthis way can one come to a realistic determination of
the purchase price. Usually, the temptation to overestimate the potential of an acquisition is much greaterthan underestimating it. Fortunately we have experience in this matter. Portec is the sixth company that
we have successfully integrated in the last 15 years –and it is probably among the acquisitions with thehighest return on investment.
What is important when considering
an acquisition?
You must set the course properly. An important company acquisition is not merely the CEO’s job throughthe ceremonial signing of the contract. The real workfor the company management does not begin until
after the purchase: In the case of the Portec integration, for example, I managed the project personally.
This responsibility cannot be abdicated as a company
leader, and for good reasons. Ultimately, an acquisition causes a certain amount of anxiety in both­companies. What kind of partner will I have in the
future? What are the exact intentions? What does it
all mean for me as an employee? To keep this unavoidable phase of uncertainty as short as possible,
faithful communication and visible engagement fromthe very top as well as clear structure and decision-­making are necessary.
How was this project drawn up,
in concrete terms?
Shortly after the acquisition, we put on a two-day
event with the affected managers from the USA andEurope, for example, in which all participants could
bring in their points of view. We discussed openly andproposals were developed together. We went so far as
to take a look at and compare in detail the strengths
and weakness of specific solutions that existed at
the time in both companies. The result of the meeting was a catalog of 33 clearly defined actions thatmade sense to everyone involved and which were
subsequently implemented, one after the other. This
provided clarity from the very beginning and r­ umors
and uncertainties could largely be avoided. That
­created the confidence on everyone’s part that wasnecessary for further steps.

04.03.16 16:19

INTERVIEW

13

How important is the integration of local
management for success?
It is necessary for success. What are you supposed
to do with empty production floors and abandoned
machines? Ultimately it is always a matter of preserving the competence of the employees and letting it
develop even further in the future. We were successful at this to the extent that we actively involved the
new colleagues in the decision-making processes. In
the interim, our location in Colorado has become
a global competence center for belt curves that sets
standards across the entire group in this technological area. The entire Interroll Group simultaneously
profits from the industry knowledge of our colleagues in the USA – for example, in the demanding
airport business, which we can now tap worldwide ina more comprehensive manner. Also, we have markedly increassed the production output at Portec bylaunching the Interroll Production System (IPS). Allof what I have said also applies to the Portec Joint
Venture in China that was acquired a year later,
Pert Engineering in Shenzhen. There we were able
to nearly double the output capacity on the existing production area in only one year, thanks to joint
efforts and the high degree of engagement of the newcolleagues.

What can we expect in the way of company­acquisitions in the future?
We will stay the course. In other words, we will bet
primarily on organic growth in the future as well.
Ultimately, we also have positive prospects here
in the longer term. But this does not mean that wewill rule out further acquisitions. It depends on theindividual situation: We will not stray from the pathof commercial reason and will only act on realistic
prices. It really has to fit, technologically and withregard to sales prospects – just as it did in the case of
Portec and Pert Engineering.

“We want to generate 50 percent
of our sales from our business in
America and Asia.”
So Interroll is internationally better positioned
than it was in the past, due to the acquisition?
Without a doubt. The acquisition was another milestone on our globalization path, which is aimed at
generating over 50 % of our sales from the businessin America and Asia. This is a tall order, as we are also
growing strongly in Europe. Our management structure, which integrates the competence and responsibility of the local managers, supports us optimally in
our worldwide expansion. So we do not believe thatknowledge of the entire world is available at the strokeof a key in Tessin. Therefore, regionally and locallyanchored management play an especially importantrole on all levels of decision-making, also, by the way,
and precisely in corporate management. In the future
it will even become more important to promote thisenormously valuable international exchange of experience and competence across the Group.

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OVERVIEW OF FINANCIAL POSITION, EARNINGS AND CASH FLOWS14OVERVIEW OF FINANCIAL
POSITION, EARNINGS AND
CASH FLOWSNET SALES

271.9

2011

307.2

316.3

2012

2013

EBITDA AND
EBITDA MARGIN
335.3

360.7
36.2
13.3 %

2014

2015

EBIT AND EBIT MARGIN

2011

41.1
13.4 %

2012

45.4
14.3 %

44.1
13.2 %

2013

2014

20.4
7.5 %

2011

2012

27.2
8.6 %

25.4
7.6 %

2013

2014

2015

EQUITY AND
EQUITY RATIO

143.3
59.9 %

157.6
69.3 %

187.2
72.5 %

200.3
72.0 %

2015

NET PROFIT
29.3
8.1 %

39.8
11.0 %
24.8
8.1 %

58.2
16.1 %

18.2
6.7 %

19.4
6.3 %

20.5
6.5 %

2011

2012

2013

19.1
5.7 %

2014

2015

CASH FLOW

207.6
70.9 %

44.5

40.2

38.2
27.8
14.5

2011

2012

2013

2014

2015

2011

2012

2013

2014

2015

All amounts in million Swiss francs.

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OVERVIEW OF FINANCIAL POSITION, EARNINGS AND CASH FLOWS

15

INCOMING ORDERS AND SALES DEVELOPVERY POSITIVELY
Order intake increased by 9.8 % in 2015 to CHF 385.1
million (previous year: CHF 350.7 million). The highest order intake in the history of Interroll was thusachieved. Organic growth amounted to 8.3 %. The
acquisition of Pert in China in June 2014 adjusted forsmaller divestitures contributed 1.5 % to this increase.
In local currency, orders rose sharply by 18.1 % andsales by 15.9 %. A share of the sales growth was eliminated by the considerable translation effect arisingfrom the translation of revenues, primarily from the
EUR zone, into the reporting currency CHF. The
extremely negative currency translation effects from
Europe were offset to some extent by slightly positive
currency developments in the dollar region.
Despite the significant translational effect, consolidated net sales in the reporting currency CHF rose to
CHF 360.7 million, an increase of 7.6 % over the previous year (CHF 335.3 million). This increase can be
attributed to organic sales growth of 6.2 % as well as
the successfully integrated acquisition of Pert, adjusted
for smaller divestitures, which accounted for 1.4 %.
IMPROVED PRODUCTIVITY AND­ELIMI­NATION OF NON-RECURRING COSTSIN THE PREVIOUS YEARIn 2014, we had high non-recurring costs due to ourinvestments in long-term growth and the sustainableprofitability of the Group. These non-recurring costs
related primarily to the development of our modular
conveyor platform and consolidation of plants in the
US following the acquisition of Portec in 2013.

TOTAL ASSETS REFLECT GROWTH
Total assets increased to CHF 293.0 million as of
31 December 2015 and were thus 5.3 % higher thanat the end of 2014 (CHF 278.2 million). The increaseis mainly due to the increased business activity. For
instance, inventories in conjunction with the introduction of the modular conveyor platform were higher.
Shareholders’ equity as of 31 December 2015 amounted
to CHF 207.6 million and was 3.6 % higher than the
figure of CHF 200.3 million posted as of 31 December 2014. This increase resulted primarily from thehigher net profit, which decreased quite significantly,
however, due to currency translation differences. The
equity ratio thus stood at 70.9 % compared to 72.0 % asof 31 December 2014.
Net financial assets increased to CHF 31.3 million as of
31 December 2015.
STRONG CASH FLOW SUPPORTS GROWTH
AND INVESTMENT
Buoyed by higher net profit, operating cash flow increased to CHF 40.2 million or 11.1 % of net sales (previous year: CHF 27.8 million or 8.3 % of net sales).
Investments of CHF 24.3 million (previous year: CHF
16.8 million) related to extensions and renewals of ourmachinery, the SAP project and mainly a new buildingin Baal / Hückelhoven, Germany.
Despite the higher investments, at CHF 17.3 million,
free cash flow was significantly higher than in the previous year (CHF 12.0 million).

Due to the high increases in our productivity and net
sales in 2015 and the elimination of the above-mentioned non-recurring costs from the previous year,
earnings before interest, taxes, depreciation and amortisation (EBITDA) increased by 32.0 % to CHF 58.2
million in 2015 (previous year: CHF 44.1 million). The
EBITDA margin was 16.1 % (previous year: 13.2 %).
Earnings before interest and taxes (EBIT) also improved over the previous year. After CHF 25.4 million
in the previous year, this figure amounted to CHF 39.8
million in 2015. The EBIT margin was 11.0 % ­(previous
year: 7.6 %).
Net profit rose quite significantly from CHF 19.1 million to CHF 29.3 million compared to last year.

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OVERVIEW BY PRODUCT GROUPS16

OVERVIEW BY
PRODUCT GROUPS
Sales by product groups
26 %
31 %
29 %
14 %

Rollers
DrivesConveyors & Sorters
Pallet & Carton Flow

SALES (CHF MILLION)ROLLERSSALES (CHF MILLION)
DRIVES

References
Dematic
Knapp
SSI Schäfer
TGW
Vanderlande

References
Itab
Smiths Detection
Triumph International
Villeroy & Boch
WalmartSALES (CHF MILLION)CONVEYORS & SORTERS

SALES (CHF MILLION)PALLET & CARTON FLOW

References
AmazonChina Post
Fedex
Hugo Boss
Smiths Detection

References
Coca-ColaFirst Quality Tissue
Procter & Gamble
Red Bull
Yamaha93.4 110.3
107.2 49.8
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OVERVIEW BY PRODUCT GROUPS

17

All our product groups developed positively in local currency.
Due to substantial negative translation effects from translating revenues, ­primarily from the EUR region, into the reporting­currency CHF, a share of the local sales growth in the individual­product groups was eliminated.

PRODUCT GROUPROLLERS
Demand for our high-quality conveyor rollers wasquite encouraging in all three regions. We sold moreconveyor rollers this year than in any other year in
the history of Interroll.
Our product group Rollers includes all non-driven
conveyor rollers. Consolidated sales for this productgroup amounted to CHF 93.4 million in 2015, well
above the previous year’s figure of CHF 81.2 million(+15.0 %).

New orders amounted to CHF 91.9 million on a consolidated basis after CHF 84.6 million the previous
year (+8.6 %).
The 500 million conveyor rollers we have manufactured makes us one of the leading suppliers in thissegment worldwide. Thanks to very short delivery
times, our customers are flexible in sourcing and only
need to maintain low inventories.
We launched our customer programme «Rolling On
Interroll» in March 2015. Especially medium-sizedmachine and plant manufacturers are fighting
against ever-increasing competition, higher technicalrequirements and ever tighter project deadlines intoday’s market environment. They trust in the reliability of supply and product quality that Interroll isknown for. This is exactly what our quality seal «Rolling On Interroll» expresses.

Somefi is just one of more than 30 “Rolling On Interroll” partners who arepleased with the quality and service that Interroll offers.

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18

PRODUCT GROUP
DRIVES
The product group Drives includes our 24 volt drive
technology (RollerDrive) including controls andour drum motors. Sales declined slightly by 4.0 % to
CHF 110.3 million compared to CHF 114.9 million
last year.
Order intake in Group currency decreased alsoslightly by 1.8 % to CHF 111.5 million compared to
CHF 113.6 million last year.

24V RollerDrive
Our motor-driven 24-volt conveyor rollers are characterised by low energy consumption, reduce noise
and are easy to install and maintain. We thus help
our customers remain competitive and organise processes in the area of internal logistics efficiently.
The advantages that 24-volt technology offers arebeing noticed by more and more customers all over
the world. We were able to increase order intake inthis category quite significantly in all three regions
and are seeing growing awareness of the use ofenergy-efficient drive systems in the Americas andAsia-Pacific regions.

Interroll products as the 24-volt drive technology contribute to a sustainable use of ressources.

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OVERVIEW BY PRODUCT GROUPS

19

Extended controller family
We offer our customers just the right control of theconveyor that meets their exact requirements for any
conveying task. In June 2015, we extended our family of controls for the RollerDrive EC 310 to include
the Interroll MultiControl, a network card for PROFINET, EtherNet/IP and EtherCAT. The constructionof an additional sensor or actuator level has been
omitted due to the direct integration of sensors andRollerDrive into the fieldbus level.

Hessnatur, the world’s largest provider of sustainable fashion,relies on our 24V RollerDrive technology.

Drum motors
Our asynchronous and synchronous drum motors
are not only durable, reliable and low-maintenance,
but are also characterised by maximum energy efficiency. Since the drive units are located inside thedrum, they require much less space and partly fulfil
the requirements of the international protection class
IP66 and IP69K. Our drum motors meet the material
requirements that the USDA/FDA and the EU Regulation EC 1935/2004 places on use in the food industry. They are also the only drum motors certified forhygienic industrial applications by the European
Hygienic Engineering & Design Group (EHEDG).
The increasing demand for our synchronous drum
motors has resulted in a gratifying increase in production volume at our Center of Excellence in Baal /Hückelhoven.

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OVERVIEW BY PRODUCT GROUPS

20

The platform is known for its high quality, flexibility, energy efficiency and attractive design. Winning
the iF Design Award shows that attractive industrial
design and high quality technology are not mutually
exclusive.

Just 52 hours: a success story of a sorter retrofit in 52 hours by Siemens
and Interroll, during ongoing operation at the TKC Deep Freeze Logistics
Center in Birrfeld, Switzerland.

PRODUCT GROUPCONVEYORS & SORTERS
Our product group Conveyors & Sorters includes
sorters and modules that are used at key points ofinternal logistics. These include cross-belt sorters,
belt curves and the modular conveyor platform withroller and belt conveyors and other modules. At
CHF 107.2 million, consolidated sales in 2015 wereup on the previous year (CHF 79.8 million) by a significant 34.4 %.

The Interroll Portec Belt Curve, which has been
installed more than 80,000 times worldwide, is a belt
conveyor solution for medium and heavy cargo. We
have now been manufacturing and marketing this in
Europe as well since 2015 and can therefore ship to
our customers in this region much faster.
Due to the significant increase in demand for automation solutions in Asia-Pacific, we were able togrow strongly in this region in terms of order intake.
S.F. Express in China views Interroll as a strategic
partner for key elements of conveyors and signed
a framework agreement for Interroll Portec Belt
Curves in the reporting year.
The Americas region also developed extremely positively in 2015. We received many very promisingorders here. For example, the Brazilian Post placed an
additional order for four cross belt sorters throughits US system integrator NPI after the company had
already ordered six sorters in November 2014.

New orders totalled CHF 120.2 million on a consolidated basis compared to CHF 95.9 million the previous year (+25.3 %).
We introduced our modular conveyor platform to
the European market in May 2014. Customers use
our platform to be able to cope with fluctuationsin the throughput of goods, changes to order structures and to manage their product ranges quickly
and efficiently. We have already received more than
250 orders in Europe and are seeing a continued
positive development. We started developing the
Asian market in October 2015 and North America
will follow in 2016. Here, too, customers have alreadyshown great interest in this innovative platform.

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21

Today, PCI Augsburg GmbH is a leading company in the field of construction
chemicals that is part of BASF SE and produces powder and dispersion
products at its plant in Augsburg.

PRODUCT GROUPPALLET & CARTON FLOW
Our product group Pallet & Carton Flow includes ourdynamic storage solutions for pallets and parcel packaging based on the FIFO principle (First In, First Out)or LIFO (Last In, First Out). In 2015, consolidated sales
amounted to CHF 49.8 million after CHF 59.4 million the previous year (–16.2 %). A large-scale project
developed in 2015 will not be completed and invoiced
until 2016.
By contrast, consolidated order intake increased from
CHF 56.6 million to CHF 61.5 million in 2015 (+8.7 %).
Flow storage utilises the effect of the inclined plane.
This means there is no need to supply drive systems
with power. Studies demonstrate the high energy andenvironmental performance of flow storage with anaverage payback period of two to three years.

Interroll has also received an order from Merit Food
Products (MFP), the only canned coconut productmanufacturer in Thailand, to provide 4,140 palletmodules for the installation of a pallet storage system
to ensure that MFP optimizes space utilization withhigh-end quality.
We also completed major projects in Europe. For
instance, we were able to realise another project, thistime in Russia, for our customer Frito Lay. A central
distribution warehouse was also equipped with an
Interroll FIFO solution for Prix Quality, one of thelargest discounters in northern Italy, through a system
integrator. This led to significant savings, especially interms of space requirements, but also in the area ofenergy, due to the complete overhaul of intralogistics.

In 2015, we were able to take interesting orders in
Asia-Pacific, in particular, and grew strongly in theregion in terms of new orders. For example, our customer from Korea, Nongshim Engineering, will beequipping a new distribution centre in China with
Interroll flow storage.

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OVERVIEW BY REGION

22OVERVIEWBY REGION
SALES
EMEA

59 %

SALES
AMERICAS

27 %

SALES
ASIA-PACIFIC

14 %INTERROLL IS ACTIVE WORLDWIDE VIA OWN COMPANIES,AGENTS AND DISTRIBUTORS.

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OVERVIEW BY REGION

23

Our goal is to realize more than 50 % of our sales outside
Europe in three to four years. We moved a step closer
to achieving this goal in 2015. Our sales share in Europe
is around 59 % and 14 % in Asia-Pacific. In the Americas,
it rose by 3 % to 27 % in the year under review.

+1.9 %IN LOCAL CURRENCY+15.0 %

210.2

214.3

EUROPE–MIDDLE EAST–AFRICAPOSITIVE DEVELOPMENT OF THE REGIONEUROPE MIDDLE EAST AFRICA (EMEA)
The significant negative translation effects from thetranslation of revenues, primarily from the EUR region
into the reporting currency CHF, have eliminated partof the sales growth in the EMEA region. Nevertheless,consolidated sales developed positively in this regionin 2015 and amounted to CHF 214.3 million, a 1.9 %increase over the previous year (CHF 210.2 million).
Sales in local currency increased by 15.0 %.
Sales in local currency developed differently in thevarious European regions. Interroll grew solidly in the
DACH region and in Scandinavia. We even experienced very strong growth in Italy and Eastern Europe.
We will continue to expand our activities in the areaof services. We have invested in our own service centerfor drum motors in Spain and expanded our service
activities even further in Turkey. We want to address
the Arabic markets with our new service and training
center in Istanbul.

2014

2015

We now also manufacture and market the Interroll
Portec belt curve in Europe and will be able to supply
our customers in the region with this proven solution
much faster in the future. The reliable, robust and globally recognized belt curve has been installed more than80,000 times worldwide.

Sales development in the EMEA region
in CHF million

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OVERVIEW BY REGION

24

AMERICASSTRONG SALES PERFORMANCEIN THE AMERICAS
The Americas region recorded sales growth of 19.2 %in 2015. Sales amounted to CHF 97.6 million (previous
year: CHF 81.9 million).
The growing complexity in the supply chain processwith regard to unit handling has increased the needfor processing, packaging and conveyor systems. Major
customers of conveyor systems in the USA such as GA
Pacific and Johnson & Johnson, among others, range
across a multitude of manufacturing industries andsectors where goods are handled. These activities,
along with the acceptance of energy-efficient conveyor
components such as the Interroll RollerDrive havecontributed to this rapid growth.
We continue to see a positive development in Brazil.
After we had already signed a framework agreementwith the Brazilian Post in November 2014 together
with the US system integrator National Presort L.P. todeliver a total of six sorters from 2015 to 2017, an additional order for four more cross belt sorters followedin April 2015. Due to the magnitude of this frameworkcontract, the regional Center of Excellence in Atlanta is
working together very closely with the global Interroll
Center of Excellence in Sinsheim, Germany.
The Interroll Portec site in Cañon City, Colorado, hasbeen expanded into a global Center of Excellence forbelt curves. With the introduction of the Interroll Production System and the modernisation of the entire
production process, we were able to increase productivity at this site quite significantly. This enables
faster processing of customer orders. In addition, we
have revamped the IT infrastructure and expanded
advanced training of employees.

+19.2 %IN LOCAL CURRENCY+19.1 %

97.6
81.9

2014

2015

Sales development in the Americas region
in CHF million

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OVERVIEW BY REGION

25

ASIA-PACIFICEXCELLENT SALES PERFORMANCEIN THE ASIA-PACIFIC REGION
Demand for high-quality internal logistics is unabatedin Asia-Pacific. Thus, consolidated net sales in 2015
amounted to CHF 48.8 million (previous year: CHF
43.2 million). This represents an increase of 13.1 %.
New orders in Asia rose very strongly by 35.7 % andshow that our increased expansion in the region isbearing fruit. We have received interesting orders in thearea of Pallet & Carton Flow and Conveyor ­Rollers in
Malaysia as well as Thailand and Indonesia. Due to thetense political situation, we recorded a decline in salesin Thailand, particularly in the 1st half-year of 2015.
In the meantime, Pert Engineering has been successfully
integrated into the Interroll Group and the ­Shenzhensite in China has been expanded into a regional Centerof Excellence for belt curves. We have invested in
the renovation of the production facilities as well as
additional machines such as an automatic belt cutting
system and a laser machining center for steel parts.
Together with the introduction of the Interroll Production System, this has led to a significant increase inproductivity and capacity expansion, but also to significantly shorter delivery times for customers.
With yet another production hall in Suzhou, we will
also be able to increase our capacity in China byapproximately one third and at the same time signifi­
cantly shorten our delivery times there.

We officially presented our modular conveyor platform
in Asia at CeMAT Asia in Shanghai in October 2015.
This innovative solution is also arousing great interestin this region, and we expect to see a further rise indemand for our products.
We expect the boom in e-commerce and food processing in China to continue and ensure a steady increasein demand. Our sales in China have increased by
20.1 % compared to the previous year.

+13.1 %IN LOCAL CURRENCY+14.1 %

43.2

48.8

We have continued to strengthen our market positionin Asia-Pacific and were not only able to acquire interesting repeat orders from long-standing customers
such as China Post or SF Express, but have also managed to expand our customer base with local customers even further.
The Nongshim Group, a well-known Korean manufacturer in the food industry, is building a new ­bottlingplant for mineral water in China and will equip its
new distribution center Baeksansu with Pallet Flow
Modules and the appropriate safety equipment fromInterroll through its system integrator Nongshim
Engineering.

2014

2015

Sales development in the Asia-Pacificregion in CHF million

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INTERVIEW

26

WE HAVE JUST BEGUN
TO OPEN UP THE POTENTIAL
IN AMERICA AND ASIA
Interview with
Tim McGill,
Executive Vice President Americas

andDr. Ben Xia,
Executive Vice President Asia

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INTERVIEW

27

It’s not Europe alone which offers promising business opportunities for the Interroll Group. With
its global strategy the company is successfully progressing in the Americas and Asia during the lastyears. The aim is to increase the share of business
attributable to these markets gradually to 50 %of Group sales in the coming years. We spoke to
Tim McGill, Executive Vice President Americas, andDr. Ben Xia, Executive Vice President Asia, both
members of the Group Management, about recent
trends, future challenges and the value of theseregions for Interroll.
Mr. McGill, Dr. Xia, once again Interroll achieved
significant increases in sales in the Americas andthe Asia-Pacific region during 2015. Which were themain reasons for this success?
McGill: The basis for this success was the overall sa­­­
tisfaction of our customers and the upgrading of ourown performance for both products and services –and I think in this respect I am talking also on Ben’s
behalf. We benefitted from an outstanding engagement
and competence of our local and global teams. In theAmericas, with a sales increase in North America of
25 % we are now starting to reap the fruits of the strategic decisions and investments we have made in thisregion during the last years: We completed our new
operational setup in the US and Canada and strengthened our presence in Brazil. We successfully integrated
Portec, a leading international curve manufacturer
acquired in 2013. All these factors were pivotal for our
success and improved our clout in the market.
Dr. Xia: An important reason for our continued
success in Asia is our clear and consistent strategy.
With our new headquarters in Shanghai and theenhancement of our production facilities in Suzhou
and S­ henzhen, the effectiveness and the clarity of ouroperations have been considerably optimized. Moreover, we have seen a marked and steady build-up of
our local competencies in Asia regarding the rangeof products offered and their production. Following
the Portec acquisition we successfully integrated Pert,a former joint venture of Portec in China. Anotherimportant factor was the successful implementationof the Interroll Production System (IPS), which allows
our company to apply its quality standards across theGroup and to regionally satisfy customer demands
in Europe, America and China at precisely the samehigh level. One of these effects is the remarkable sales
increase in Asia of 13.1 % in 2015 – and we have justbegun to open up the potential of the Asian market.

1_INT_GB2015_Imageteil_Inhalt_EN.indd 27

What is the general state of the industry
within your regions?
Dr. Xia: Asia-Pacific is a diverse and dynamic region
which offers very promising opportunities for us. Let’stake China as an example: Although the impressive economic growth rate of this country has recently slowed
down, its ambition for the future is even higher than it
was in the past. Official plans aim to double the grossdomestic product and to double the average incomeof every Chinese wage earner by 2020, comparing tothose of 2010. This means that a lot of opportunities
are emerging for us. Our market will grow remark­ably. At the same time, we will see new challenges. For
example, we have to sharply increase our productivity
to catch up with the expected development.
McGill: The economy in North America, especiallyin the US, remains strong. One reason is the the low
price of oil, which leads to more industrial dynamics, an increased buying power of consumers and thecreation of new jobs. These condition are favourable
for our business as a producer of investment goods
within the logistics sector. Additionally, we are experiencing a ­further acceleration of the E-Commercebusiness. Interestingly, this trend is not only driven by
the strategy of established players like Amazon or others. Major retailers like Wal-Mart are now returning tothis business and have high ambitions to capture anadequate market share during the years to come. Concurrently, the middle class in emerging markets like
Brazil or Mexico is growing, and a broader interest indiversified consumer products puts new demands on
warehouse and retail logistics. These are some of thefactors which play into our hands.

04.03.16 16:20

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28

Do Asian customers have specific expectations?
Dr. Xia: Some people looking from outside Asia still
think that this continent is mainly characterised by the
specifics of emerging economies and societies. Obviously, this is only partly true and will be less applicablein the future. Even if you put Japan, South Korea andAustralia aside you see that decision makers within
mostly all Asian countries are nowadays well-informed
about state-of-the-art technologies and solutions theglobal market offers. Of course, this has a lot to dowith internationalization and borderless exchange
of information but it’s based on a cultural factor too.
Most people and countries in Asia that aim to reachthe same level as traditional industrial societies wantto speed up on this path by overleaping certain phases.
Therefore, they are searching to get the best of what the
global market can offer. That’s one of the reasons why
Chinese consumers like global brands. It’s the same
trend within the industrial field from which we as aworldwide leading company can clearly benefit. Just
one example is our successful business partnershipwith China Post. This is a customer who is always asking for the best, the most efficient and the most challenging solution in the world. That’s why we have won
the orders.

“ Thorough understanding of
the markets and establishedbusiness relations are driving
our success in the Americas.”

And what about the Americas?
McGill: Interroll has been present in North America
for about 40 years. One effect of this long traditionis our thorough understanding of this market andan established business relationship with American
partners. This position was further strengthened by
the acquisition of Portec, a leading US-based manufacturer. During the current phase of accelerated globalization we recognize the continued trend that ourcustomers with global operations want to keep theirperformance on the same level all over the world. They
don’t want to compromise on quality and they demandin every country the efficiency and reliability of thesolutions they know. A good example is a global player
like PepsiCo Foods which uses our solutions not onlyin its home market but globally as well. Moreover, weperceive a growing international interest of companies
to use Mexico for onshoring as a base for production
and distribution. That’s why we intend to open an officein this country to be able to better serve this demand
and to achieve a “climate of excellence” in our relationship with our customers. In Brazil we already applied
this strategy successfully in the past: There we wereable to get the largest single order Interroll ever won inits history. We have received multiple orders to deliver
in total 10 sorters to Brazil Post in 2016 and 2017 –together with our partner and System Integrator NPI.
Where do you see new opportunities
in the years to come?
Dr. Xia: Besides further intensifying our efforts toincrease our existing business we want to gradually
expand our activities to new industries and regions.
One very promising example is the food industry.
In Asia, food is not just nutrition, it’s an integral partof daily lifestyle and culture. That’s why, especiallyin urban areas and booming metropoles, freshness,diversity and hygienic considerations play a crucialrole. Consumers, industry and regulators will certainly
pay greater attention to these issues. Applying theright strategy, this trend will provide great opportunity for us. Drum motors and other products that wedeliver fulfil the highest hygienic standards and allow
very flexible and efficient operations. Additionally, we
see large system integrators from outside the region
enhancing their activities in Asia. This gives us newopportunities to serve them locally. At the same time,
countries like Vietnam or Malaysia are progressing
economically. Now even Myanmar has opened up its
market. So, without a doubt, there is still a lot of work
waiting for us.

Tim McGill, Executive Vice President Americas

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INTERVIEW

29

Dr. Ben Xia, Executive Vice President Asia

“In Asia we are following
a clear and consistent strategy.”
McGill: US and Canada offer a lot of further opportunities. Higher expectations of consumers drive E-Commerce: Order and delivery within one day will be amust within this business in the near future. These services challenge logistical processes. Returns need to beefficiently handled. Respective concepts demand speed,
intelligence, reliability and efficiency for internal logistics. These are exactly our strengths. Pharmaceutical
distribution is another interesting industry where we
can help the market with our competence. We alreadytalked about Brazil and Mexico. Other countries in
Latin America are expected to follow their examples.

McGill: Yes, sustainable value creation is not merely
a question of figures. They are crucial, but to stayon the right track in the medium-term, we have toensure that the Group also benefits from the competencies and expertise of the employees in the individual regions. We have to increase our relevance in thisrespect, too. Within our worldwide organization, ourstaff develops additional competencies, creates new
ideas and finds new solutions – every day and in every
country where we are present. This asset, this capacity
is available for the whole organization. As managers
we have to leverage a mutual exchange of these competencies. Nothing should be invented twice, people
should learn from the experiences and competenciesof ­others. Within some areas, our colleagues in Europe
and Asia already profit from our expertise, while inother fields we profit from the know­-how available inEurope and Asia. Europe transfers its knowledge to
Asia and vice-versa. We need to further expand ourcompany as a global network of competencies. This
adds a lot of value to our company.

What are your goals for the future?
Dr. Xia: Our aim and commitment is of course tofurther enhance our contribution to the Group as awhole and to support Interroll’s ongoing international
success. This relates to both sales and profitability. Tim
will surely agree with this statement for his region too.
In Asia, it is very important to manage our growth in
the right way. The build-up of our business needs tobe sustainable. Just to mention some important factors: We need to optimize our responsiveness because
customers expect high-quality products and immediate support at the same time. We need to work on thebrand because customers must be able to rapidly identify our solutions as world-class solutions. This will
also internally help find and keep the right p­ eople. The
competencies of our employees represent a real potential for the Group that we have to tap.

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CORPORATE RESPONSIBILITY30

CORPORATERESPONSIBILITYRESEARCH & DEVELOPMENT: INNOVATIVE TECHNICALSOLUTIONS AS THE BASIS FOR SUCCESSIn order to optimally meet customer requirements,
we invest considerable resources in research and development. We supplement our internal competencies
with external partnerships with leading universities
such as the RWTH Aachen or the Technical University Munich and industrial partners such as the
EHEDG Institute (European Hygienic Engineering &Design Group).
The Interroll Research Center (IRC) in Germany is oneof the most important institutions which we continually expand our leadership in innovation with.
Our IRC worked in 2015 in cooperation with
the individual competence centers on importantdevelopments,.
One area of concentration were optimizations of our
drum motors with regard to noise reduction and an
expansion of its functional spectrum. Furthermore,
the foundation was laid for a new drum motor platform with greater flexibility, a broader range of use
and improved service options. The new platform is to
be introduced to the market over the course of 2016
and 2017.

With MultiControl we developed a new method ofcontrolling zero pressure conveyors. With this new
network card, the expansion of an additional sensor
or actor level can be omitted due to the direct integration of sensors and RollerDrive on the field bus level.
The MultiControl is naturally also used worldwide forthe new conveyor platform.
We expanded our proven RollerDrive with a freezer
design. Safeguarding against failure is increased by aspecial form fit. Automatization in the freezer area istaking on an increasingly important role, and Interroll
intends to expand its product palette in this area.
We were able to better connect the development
and test laboratory areas physically by moving theInterroll Research Center into our new facility at the
Baal / Hückelhoven site and bring the technical infrastructure up to the state of the art. In the new, modern
facility there is more room available for the development team and for testing.
We protect many of our innovations through numerous patents and other property rights.

In the area of sorter applications, we are working on
new solutions in order to reduce speed in various
weight classes during unloading in a controlled manner. Also, additional innovations were developed thatare currently registered for patent approval.

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ENGAGED EMPLOYEESMAKE US STRONG
Around 2,000 employees worldwide make their contribution to the success of Interroll every day. Our
employees are the decisive factor in our exciting themarket with outstanding products and solutions, forremaining competitive through innovation, and fororganizing our processes efficiently. We expect a highdegree of engagement, ambition and loyalty. In return,
we offer interesting, challenging tasks with the f­ reedomof entrepreneurship to match.
Interroll is on an unabated course of growth. With our
new facility at Baal / Hückelhoven, Germany, where
the Interroll Academy has also been located since
October 2015, Interroll continues to invest in the training and professional development of its e­mployees.
Now the modern facilities are available for various
training sessions and practical instruction on I­ nterroll
products. These serve to strengthen the technical competence of our operation. Starting 2016 we are alsooffering courses and training for our customers in the
new Interroll Academy.

Growth also means change. To be able to cope withchange successfully, strong leadership and technicalcompetence are indispensible. Employees must continually orient their thoughts and actions toward thecompany’s goals. For this reason we launched ourinternal program “Culture for Growth” in 2015. Witha focus on corporate culture, we want to contribute tobetter distinguishing ourselves from the competition
and a greater identification of the employees with thecompany. Our employees serve as brand ambassadorsin this regard.
Through “Culture for Growth” we want to familiarize
each and every employee with the company’s strategy– both globally and locally. We value the commitmentof each individual and respect cultural differences.
To this end, we launched a global program for (continued) development for over 200 managers in 2016.
In the coming year we will perform a worldwide surveyof our employees. Constructive feedback on generalsatisfaction and the quality of leadership in the company and on topics such as awareness of values, cooperation and engagement is meant to help us implement
concrete improvements. The survey will take place inabout 12 languages.

Following its successfull launch in Europe and Asia, Interroll’s new
Modular Conveyor Platform will now also be produced in America.

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MARKETING ACTIVITIES SUPPORTOUR PATH OF GROWTH
In 2015, we further refined our central marketing strategy, in order to increase familiarity worldwide with
Interroll products, intensify customer relations andthereby contribute to the growth of the Interroll Group.
To achieve the greatest possible focus on customers,
we align our marketing activities directly with local
marketing conditions and customer habits.
An important part of our marketing strategy is ourpresence at technical trade fairs. In 2015, we wererepresented with our products and solutions at some
20 global and numerous local trade fairs. The introduction of our modular conveyor platform in Asia at the
CeMAT Asia in Shanghai in October 2015 is particularly noteworthy in this regard. Within the scope of
the World Fair in Milan, various specialized trade fairs
such as Intralogistica took place in May. There we presented our extensive product portfolio and the modular conveyor platform to the Italian market.

and offer joint seminars. It is our goal to establish aninternational community in which “best practices”
can be shared in an open way, and partners are closely
connected with one another in order to benefit fromsynergies.
The partnership with the Sauber F1-Team also offers
us further opportunities to present our offering ina context in which logistics is among the deciding
factors to success. In 2015, we also organized various
seminars at the Sauber headquarters in Switzerland
as well as various customer activities in cooperation
with Sauber.
In 2016, our marketing will continue to be focused on
the acquisition of new customers, positioning Interroll
as an innovative company in the area of intralogistics
as well as on demonstrating competitive advantages.

The customer loyalty program “Rolling On Interroll”,
which we introduced in March of 2015, has been very
successful. System integrators and OEM from allcontinents have already decided to join this program.
By displaying the emblem on their products, participating partners express their confidence in the competence and technology of Interroll. We reward thisloyalty, among other ways, with access to our t­ raining
offering, support advertising and trade fair budgets,

Customers rely on Interroll’s competence
and technological expertise.

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CORPORATE RESPONSIBILITY33

SUSTAINABILITY IS A LONG-TERM SUCCESSFACTOR FOR US
The Interroll strategy was developed for long-term
success and sustainable growth through a transparent
business model. In this culture of growth, we consistently work at shaping our future and strive to positively
influence the basic conditions for it accordingly.

The results of the IPS audits are very important to us.
Our responsible parties use the information obtainedin this way to achieve excellent processes, to compare
these with other companies internally (through benchmarks) and to continually improve these (kaizen).

Our approach to sustainability is based on the “Triple
Bottom Line” concept (people, planet, profit), which,in addition to the social and ecological aspects ofoperational processes, also keeps an eye on the economic dimension.

Through our regional presence, we can guarantee theglobal availability of our innovative products and serve
our customers more efficiently and quickly.
As a leader in technology, we place great value inknowledge management for work materials. In addition to ensuring functionality and efficient material
usage, we want to increasingly expand on our knowhow with regard to recyclability and the use of healthymaterials.
The topic of energy efficiency is at the very top of
our list, not only in terms of our products. In accordance with DIN EN 16247-1 we have performed anenergy audit at several sites. It was our aim to identify
energy flows and potential areas for energy efficiency
improvements. In a further step, we evaluated thevarious actions monetarily through investment andcost-effectiveness calculations. The improved energy
efficiency achieved through the implementation ofthese actions will protect the environment and reducethe cost of our operations.

A central factor for the realization of this concept is
our Interroll Production System (IPS), which waslaunched in 2006. The essential core elements are our
global organization of production, the implementation of the platform strategy, the innovation process
and excellent processes. Through internal and external
audits, all production processes are regularly evaluatedand new goals are set. In this way, the level of our productivity – and therefore our contribution to sustainability, rises steadily. Beginning next year we will starta comprehensive rubric on the topic of sustainability.
With this we intend to ensure the worldwide implementation of our concept. This will also include thelist of requirements for investment decisions with theobjective of increasing transparency and the degree of
detail for criteria such as energy efficiency effects on
the environment, and ergonomics.

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INNOVATION

34

ROLLERS THAT MOVE
THE WORLD
They are unbeatably reliable, durable and variable: For over 55 years, ­conveyor
rollers have formed the foundation for the growth of Interroll into a ­leadingworldwide manufacturer of key products in intralogistics. In addition to nondriven roller conveyors of all possible sizes and designs, highly-efficientdrive rollers and intelligent control systems have also long been part of ourinnovative conveyor roller range of products. Support services and open datainterfaces simultaneously ensure an even simpler integration in complex
applications – even in future ­“Industry 4.0” concepts.

Just as does the wheel in street traffic, the conveyor
roller has no alternative in many applications in intra­
logistics. In 2014, Interroll delivered its five hundred
millionth roller in its tradition-steeped company history, with which a conveyor could theoretically bebuilt around the globe – and production is continuing
unchecked. In 2015, more rollers were manufactured
in Interroll’s factories than in any previous year. “In
addition to our main plant in Wermelskirchen, where
our global competence center for conveyor rollers andRollerDrive is also located, Interroll has also been producing for a long time in the USA and China – andis doing so with its usual, consistently high quality,”
according to Armin Lindholm, managing director ofInterroll Engineering GmbH.

WE PRODUCE TO THE CUSTOMER’SUNIQUE SPECIFICATIONS
Due to the nearly 60,000 different designs of conveyor
roller types, an unusually large number, as well as
the often very small lots in the orders – about half ofall orders involve order quantities of a maximum of
ten rollers – Interroll places a great deal of importanceon flexibility during production: Rather than produce
for stock, Interroll manufactures its conveyor rollers exclusively “on demand”, in other words upon thecustomer’s request. That means that not a single roller
is kept in inventory in Wermelskirchen or any otherproduction site. This reduces costs substantially, anddelivery times often of less than a week can still beadhered to without problem. The customers also sparethemselves expenses and avoid quality risks that mightarise through long storage times or possibly long andinefficient transport conditions.
For this on-demand manufacturing, the production
segments are designed such that they can be adapted
to the product variant to be produced, practicallyat once. Corresponding changeover procedures takeplace in each of the 13 production lines in Wermels­
kirchen approximately 60 to 70 times per day. It is justas efficient as a pit stop in Formula 1: For a changeoverprocedure, the responsible employees need 80 seconds
on average.

The Interroll MultiControl is a network card for controlling and integrating
the RollerDrive EC310 into many conveyor technology applications suchas zero-pressure accumulation, roller curves and transportation conveyors.

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INNOVATION35“At Interroll, tempo and flexibility are not had at theexpense of quality. We regularly perform internaland external audits in ongoing production, so that
our zero-error strategy is maintained at all sites,”says Armin Lindholm. The company-wide Interroll­production system takes care of this, and is based ona lean production philosophy which fundamentally
integrates all employees in the optimization process.
INNOVATIVE QUALITY SOLUTIONS FOR
ALL APPLICATIONS
Our product palette is continuously being expanded
and endowed with innovative additional value: In
addition to non-driven conveyor rollers, Interroll alsooffers its customers the RollerDrive equipped withintegrated 24 V motors. When using them, there is noneed to utilize centrally-mounted gear motors witha technologically susceptible and energy-inefficientdesign. It is no wonder, then, that these drive rollers are
increasingly replacing the systems frequently used earlier, with electro-pneumatic control of the individualaccumulation sections.

Another example are intelligent control systems thatenable the customers to realize particularly efficiently
and flexible solutions. With these systems, not only
individual RollerDrive, but also different conveying
zones can be controlled as needed and independentlyof one another. But since some medium-sized companies and smaller systems integrators and plant engineers sometimes cannot efficiently realize the e­ xpertise
required for connecting the necessary control systems
to pre-existing warehouse software, the global competence center in Wermelskirchen has been offering its
customers appropriate support with a team of application engineers since the beginning of 2015.
“Interroll bets on innovations with added value – notonly in technology and production, but also in support. We advise and support systems integrators andmanufacturers when they use our solutions. If needed,a series of highly-qualified engineers is available
to attain optimal results from the interplay between
our controls and the pre-existing warehouse software – and, if necessary, directly on site,” according to
Dr. Ralf Garlichs, Executive Vice President of Products & Technology and member of the Group Executive Board at Interroll.

EQUIPPED FOR THE FUTURE

PRODUCTION WITHOUT BALLAST

After the steam engine, the conveyor belt, and data processing,experts believe that a fourth industrial revolution is now at hand.
Under the heading of “Industry 4.0”, production and logistical processes will be equipped in the future with their own intelligence,
networked processes will run independently, and systems will
become capable of learning. The buzzword is “smart logistics”.

Different than most of its competitors, Interroll does not produce
conveyor rollers until a concrete order has been placed. Due to aparticularly flexible production system, the production lines canbe changed over in an instant to precisely the rollers that need
to be manufactured for the current order. The delivery times areusually much less than a week.

With these intelligent solutions, monitoring and control systems
will be in a position to control and optimize value-added networks
in real-time. The flow of material is integrated in the internet ofthings by means of corresponding sensors and made able to makedecisions autonomously. Interroll is well-equipped for this development. Our control systems are already equipped with theirown interfaces today, interfaces which make integration in highly­complex system environments possible.

This “on demand” production, which is performed at an identicallevel of quality in Europe, America and Asia, provides not onlyInterroll with decisive advantages: The customers also avoid highstorage and transport costs. Additionally, quality problems are
eliminated that may arise due to adverse transport conditions.
They receive precisely the products that they need for the realization, reshaping or completion of their conveyor solutions.

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MODULAR CONVEYOR PLATFORM

36

GO WEST!
Customers who are active in the American markets will be especially pleased with the news: After being successfully introducedin Europe and Asia, Interroll’s new modular ­conveyor platform will
now also be produced in the United States.

A powerful, future-proof solution is now available to
US systems integrators and their customers interested
in achieving especially efficient material flow. This isbecause our new modular conveyor platform excels
due to its unique flexibility, low operating costs, open
data interfaces, and the greatest ease of installationand maintenance.
After all, those who want to implement powerfulmaterial flow solutions have to expect constantly
changing tasks in the dynamic market of intralogistics that such a system has to fulfill during its longservice life. U­ ltimately, users have to be able to flexibly react to short-term changes in the order structures and the range of products. Rigid mass processing of identical goods has become the exception to
the rule. Having to deal with shorter order cycles andquick packaging size and weight changes is becoming increasingly more frequent. At the same time, thesolution must also be able to be easily incorporated
into tomorrow’s changing IT environments, which is
known as “Industry 4.0.”
STRONG INTEREST FROM THE MARKET“In order to meet theses requirements for maximum
flexibility, we developed a completely new conveyor
platform that we have been providing our customers
since the second half of 2014. It is an industry-firstwhich integrates our proven plug & play module andstandard components, feature a fully modular design,”
explains Michael Kuhn, Managing Director of ­Interroll
Automation GmbH in Sinsheim, Germany. There isstrong interest in this solution: Interroll has alreadyreceived about 250 orders from system integrators andmanufacturing plants.
The sizes range from small systems to large appli­
cations that involved implementing conveyors up to
four kilometers in lenght. Given the high demand

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and the complexity of the projects, it is therefore no
wonder that the platform’s development required
the highest amount of internal interaction between­supplier logistics, production processes, and assembly, especially since it involved introducing an entirely
new product. Teamwork, learning ability, responsiveness, and close cooperation with the customers werenecessary in order to rise to these challenges. Throughthe close cooperation of all parties, the i­nevitable
start-up complications were quickly corrected. Theinternal organizational structure was also unified andadjusted to the changed market needs.
The platform is now being used in practically all
sectors that Interroll is focused on, from production
plants and e-commerce to traditional mail order anddistribution. One of the most well-known users witha rather unusual application – in a packaging plantin Milan – is Swiss luxury watch manufacturer Rolex.
MODULAR SOLUTION FOR EASY
­CONFIGURATION AND INSTALLATIONThe reasons for this broad interest are many and varied. They certainly include the solution’s universal
design, which can handle material that weighs up to
50 kg and package sizes starting at 200 mm × 150 mm.
If desired, systems can even be designed to easily
handle transporting polybags. Customers can choose
24V or 400V drives for maximum energy efficiency
or conveyor capacity. Electro-mechanical diverters
also facilitate high sorting performance. In order tomeet high energy efficiency requirements and ensure
a low noise working environment, Interroll generally
refrained from using pneumatic actuators in the newconveyor platform. But that is still not enough: Just
as important as the feasible range of applications is
the modularity of the platform, which – similar to the
LEGO brick principle – can be flexibly configured
and expanded using standard components. This not

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37

only makes installation and maintenance easier, but
it also provides short delivery times and gives system integrators key benefits as soon as the planningphase. Thanks to the user-friendly planning software that Interroll provides free of charge, customers
can quickly and easily configure conveyor solutions
themselves. As a result, customers immediately havean extensive parameterized conveyor list at their disposal that provides all the necessary data for theirengineering process. “… And for demanding applications, we made sure our platform can be connected
to higher-level IT systems through pre-cabled fieldbus technologies such as EtherCat, Profinet, or EtherNet / IP,” says Kuhn.

After Sinsheim in Germany and Suzhou in China,
Wilmington is the world’s third production site forthe new conveyor platform. Thanks to the intensive
preparation and extensive exchange of knowledge by
the experts in the global Center of Excellence in Sins­
heim, nothing stands in the way of production. The US
launch is an important milestone in Interroll’s internationalization strategy. After all, local system integrators everywhere aren’t the only ones to have access tothe industry’s leading conveyor platform now; internationally operating system integrators can now alsoreliably offer their customers a standardized quality
solution in all of the world’s important regions.

AFTER EUROPE AND ASIA NOW ALSO
­L­­AUNCHED IN THE US
Through the consistent application of the group-wide
Interroll production system (IPS), which is based on
the Japanese Kaizen philosophy thereby ensuring thatthe company’s solutions are manufactured around theworld in the same quality, the modular conveyor platform is now also ­being produced in the US, namely
in the regional Center of Excellence in Wilmington,
North Carolina.

“In order to meet therequirements for maximum
flexibility, we developed
an entirely new conveyor
platform.”

Michael Kuhn
Technical Director at Interroll Automation GmbHin Sinsheim, Germany.

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SORTER AND CONVEYOR TECHNOLOGY38

RULE OF THREE FOR
THROUGHPUT: MORE THAN
THE SORTER ALONEThe globalisation of the economy, ever faster innovation cycles and higher market transparency require
constantly more efficient delivery chains and optimised business processes. Products such as textiles andelectronics are predominantly imported from overseas, enter interim storage and from there are distributed, sorted and transported as automatically as possible. Besides shorter delivery times, this is at the sametime intended to achieve substantially higher sorting
volumes. Speed, reliability and efficiency are therefore
the decisive success factors in today’s market.

New technologies play an important role in optimising processes. In the field of identification technology
in particular there have been decisive new developments in recent years. These include, for example,
camera solutions in the most varied forms for reading
barcodes. Further examples are bus technologies. The
following, however, remains true: when one speaks ofsuccess factors in sorting, these are still availability,
sorting accuracy and flexibility.
For Interroll, as a manufacturer of crossbelt sorters andother conveying technology, this means that planningand engineering have to be done in ever shorter timeframes. The art here is to develop a solution adapted tothe customer’s individual needs using platform-based
elements and flexible adaptation. Customers expect avery high availability for their plant as a whole. Therefore the fault probability of a conveyor must be as low
as possible. Here Interroll offers a functional reliabilityof 99.9 %.
Limits in sorting are often apparent at points of input
and output. Today, firms have to master a growing
product mix. On one side, shoes or clothes enter thesorting system, then come perhaps 25 kg sacks ofanimal feed. If the transport goods are very diversely
mixed, the input and output points cannot deal withthem. Since these two points, however, account forroughly a third of the total investment in the sorting
installation, we have to ask whether everything has tobe automated.

Dr.-Ing. Heinrich Droste
Director at Interroll Automation GmbHin Sinsheim, Germany.

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39

As an independent supplier, Interroll offers a productportfolio tailored perfectly to value creation and therequirements of system integrators. Globally the company, together with its partners, has installed morethan 200 sorters, including more than 20 in 2015.
For example, Interroll has, with a partner, built an interesting installation working with very small parts whichcannot be sorted and cannot be separated at the output
point. At the same time, it conveys large heavy parts. In
this case the solution was to concentrate the goods inthe input area via a so-called put-to-light system andto convey them later to the output points in containers
via the sorter. Although this means increased manual
work, one can support these processes technologically. The task is to find the technological compromise:a simple investment calculation.

Interroll crossbelt sorters work on a mechanical basis
and are therefore especially robust and economical.
The number of electronic components has deliberately
been kept as low as possible. There is therefore no needeither for complex control systems of for speciallytrained electricians for installation or maintenance.
The simple modular construction of the sorter and its
input and output points simplifies the storage of components or the reconfiguration of existing systems.
The patented Interroll crossbelt sorter technology also
guarantees extremely economical sorting procedures,
even at throughput rates of only 2,000 pieces per hour.
Higher throughput rates of up to 15,000 pieces are
possible, depending on the sorter.
The relative importance of investment costs and operating costs varies from firm to firm. In sorting projects,
besides purchase price, conditions of payment and running costs, one should also pay attention to cost factors
such as maintenance, installation and training.

“As an independent supplier,Interroll offers a product portfolio
tailored perfectly to value
creation and the requirementsof system integrators.”

Sorters by Interroll offer speed,
reliability, and efficiency.

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OUR PRODUCTS AND
SOLUTIONS ENABLE COMPANIES TO DO BUSINESSMORE PROFITABLY, REDUCE
THEIR ENVIRONMENTAL
FOOTPRINT AND GENERATESUSTAINABLE GROWTH.

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CORPORATE GOVERNANCE

41

CORPORATEGOVERNANCE

1INTRODUCTION

42

2

GROUP STRUCTURE AND SHAREHOLDERS

42

3

CAPITAL STRUCTURE

42

4

OPERATIONAL MANAGEMENT STRUCTURE

43

5

BOARD OF DIRECTORS

46

6

INTERNAL ORGANISATION 

48

7

COMPETENCE REGULATIONS

48

8

INFORMATION AND CONTROL INSTRUMENTS

48

9

GROUP MANAGEMENT

49

10SHAREHOLDERS’ PARTICIPATION RIGHTS

49

11

CHANGE IN CONTROL AND DEFENCE MEASURES

50

12

AUDITOR

50

13

INFORMATION POLICY

50

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CORPORATE GOVERNANCE

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1

INTRODUCTION

Basis of the of the corporate governance report
The corporate governance report 2015 of the Interroll
Group refers to the official guideline of the SIX Swiss
Exchange on Corporate Governance, best practicerelated to the Minder initiative as well as to the regulations of the “Swiss Code of Best Practice for Corporate
Governance”.
Cross references
In order to minimise repeated comments, certain­sections cross refer to other sections, especially to thefinancial report.

2

GROUP STRUCTURE AND
SHAREHOLDERS

Group structure
The operational management structure is disclosed inchapter 4 of this report.
Mother company and stock listing
The holding company of the Group, Interroll Holding
Ltd., is headquartered in Sant’Antonino / TI, Switzerland. Its registered shares are traded in the main segment of the SIX Swiss Exchange under the security­number 637289. Further notes to the listing can befound in chapter “Interroll on the Capital Market” onpage 4 of the annual report.
Consolidation range
Subsidiaries belonging to the consolidation range of
the Interroll Group are disclosed in note 8.4 of theGroup’s financial statements. There are no other equity
instruments publicly traded except those of Interroll
Holding Ltd.

3

CAPITAL STRUCTURE

Share capital and voting rights
The share capital of Interroll Holding Ltd. amounts
to CHF 854,000 and is made up of 854,000 fully
paid registered shares with a par value of CHF 1 each.
Each share has one voting right.
Authorised or conditional capital
There is no authorised or conditional capital.
Other equity or participation instruments
Furthermore, there are no other equity-like instruments such as profit-sharing rights or participation
certificates.
Changes in capitalIn the year under review, the nominal value per share
was reduced from CHF 10 to new CHF 1. The total
share capital reached CHF 854,000 (previous year:
CHF 8.5 million).
Limitations on transferability andnominee rights
Information about limitations on transferability andother nominee rights of the shareholders is disclosed
in chapter 10 (“Shareholders’ participation rights”) of
this report on corporate governance.
Further information on shareholders’ equity
Additional information on equity is disclosed in thefinancial statements of the Group (see 1.5 “Consolidated statement of changes in equity”) and in therespective notes.

Significant shareholders
All significant shareholders holding a reportable shareare disclosed in note 3.5 (“Significant shareholders”)
of the financial statements of Interroll Holding Ltd.
Cross shareholdings
The Interroll Group maintains neither capital nor voting rights with other entities.

2_INT_GB2015_Corporate-Governance_EN.indd 42

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CORPORATE GOVERNANCE

43

4OPERATIONAL MANAGEMENTSTRUCTURE

Functional organisational structure
The Interroll Group consists of one single business unit.
The complete product range is sold in all markets throughlocal sales organisations. Interroll caters to the needs of
its customers (Original equipment manufacturers, system integrators, end users) by offering a ­tailor-madeproduct portfolio and expert consultancy. The Interroll
manufacturing units focus on the production of­specific product ranges. Assembly units receive semifinished products from the manufacturing units andassemble a wide product range for their local markets.
The Interroll Research Centre (IRC), which is centrally
located, researches new application technologies anddevelops new products. Global Centers of Excellence
continue developing the product range they focus on.

Management structure
The Group Management and the Interroll management structure are organized by functions (Overall
Management, Products & Technology, Global Sales& Service, Corporate Marketing, Corporate Finance).
The financial management of the Group by the Boardof Directors is, on the one hand, based on turnover ofthe product groups and geographical markets and, on
the other hand, on the reporting of the consolidated
financial statements. In addition, Group Management
assesses the achievement of financial and qualitative
targets and other key performance indicators of all
subsidiaries.
The Interroll Group has no advisory body.

Board of Directors
CHAIRMAN

Kurt Rudolf

VICE CHAIRMAN

AUDIT COMMITTEECOMPENSATIONCOMMITTEEOTHER MEMBERS

Urs TannerPhilippe Dubois

Kurt Rudolf

Stefano Mercorio

Paolo Bottini

Prof. Dr. Horst Wildemann

Ingo Specht

Group Management
CHIEF EXECUTIVE OFFICERPaul Zumbühl
CHIEF FINANCIAL
OFFICERSENIOR VICE PRESIDENTCORPORATE MARKETING &CULTURE

Daniel Bättig

Jens Karolyi

EXECUTIVE VICE PRESIDENTGLOBAL SALES & SERVICEEXECUTIVE VICE PRESIDENTPRODUCTS & TECHNOLOGY

Dr. Christoph Reinkemeier

Dr. Ralf Garlichs

REGIONS

2_INT_GB2015_Corporate-Governance_EN.indd 43

Executive Vice President Americas

Tim McGill

Executive Vice President Asia		

Dr. Ben Xia

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CORPORATE GOVERNANCE

44

Interroll Research Centre (IRC),
Global Product Management
The Interroll Research Centre (IRC) develops new products, techniques and technologies in close cooperation
with the Centres of Excellence, Global Product Management and Global Sales.
FUNCTIONAL UNIT

MANAGED BY

COMPANY

Research & Development

Helmut Maiwald

Interroll Holding GmbH, Wermelskirchen (DE)Global Product Management

Dietmar Hager

Interroll Holding GmbH, Wermelskirchen (DE)Global Centres of Excellence
Since 1 October 2015 Interroll Engineering West, Inc.
acts as the Global Centre of Excellence for Belt curves.
As per 1 January 2016, the two separate Centres Conveyor modules and Subsystems in Sinsheim weremerged into one Global Centre of Excellence named
Conveyors and Sorters. The seven Interroll Centresof Excellence are responsible worldwide for productdevelopment, strategic purchasing and the applicationand development of production technologies for specific product ranges. Furthermore, they produce andsupply semi-finished goods to Group companies. The
global Centres of Excellence of the ­Interroll Groupare managed by the following persons:
FUNCTIONAL UNIT

MANAGED BY

COMPANY

Rollers, RollerDrive

Armin LindholmInterroll Engineering GmbH, Wermelskirchen (DE)

Industrial Drum Motors

Dr. Hauke TiedemannInterroll Trommelmotoren GmbH, Baal (DE)Supermarket products

Dr. Anders-Staf Hansen

Interroll Joki A/S, Hvidovre (DK)

Dynamic storage products

Bertrand ReymondInterroll SAS, La Roche-sur-Yon (FR)Conveyors and Sorters

Bernhard Kraus

Interroll Automation GmbH, Sinsheim (DE)Belt curves

Mark MeansInterroll Engineering West Inc., Cañon City (US)Techno-polymers

Ingo Specht

Interroll AG, Sant’Antonino (CH)

2_INT_GB2015_Corporate-Governance_EN.indd 44

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CORPORATE GOVERNANCE

45

Worldwide sales and production companies
Regional Centres of Excellence (RCoE)
Regional Centres of Excellence produce for the Americas and Asia-Pacific. These centres assume the fullproduct programme of the global Centres of Excellence and serve the regional sales and service subsidiaries with finished products and the assembly sites
with unfinished goods.

Production companies and local assemblies
Guided by the production processes and production
technology by the Interroll Centres of Excellence,
local production companies manufacture and assemble
products for regional markets. They concentrate on
specific product groups within the full product range.
Sales and service subsidiaries
Interroll sales companies concentrate on specific market and customer segments offering the full range
of Interroll products and 24-hour repair service.
Management of the operational subsidiaries
The management of the above companies was delegated to the following persons:

EUROPE–MIDDLE EAST–AFRICAFUNCTIONREGION/COUNTRY

MANAGED BY

COMPANY

Sales, service

Central Europe

J. Mandelatz

Interroll Fördertechnik GmbH, Wermelskirchen (DE)Sales, service

FranceG. Calvez

Interroll SAS, Saint-Pol-de-Léon (FR)Sales, service

Northern Europe

E. KaiserInterroll Nordic A/S, Hvidovre (DK)

Sales, service

Great Britain, Ireland

Ch. Middleton

Interroll Ltd., Corby (GB)Sales, service

Iberic peninsula

R. RoviraInterroll España SA, Cerdanyola del Vallès (ES)Sales, service

Czech Rep., Balkans, Hungary

F. Ratschiller

Interroll CZ s.r.o., Breclav (CZ)

Sales, service

Poland, Russia, Ukraine

F. Ratschiller

Interroll Polska sp. z o.o., Warsaw (PL)Sales

Turkey, Middle East

F. Ratschiller

Interroll Lojistik Sistemleri Ticaret Limited, Istanbul (TR)Sales, service

Italy

F. Ratschiller

Interroll Italia Srl (IT)Sales, assembly, service

AfricaH. Campbell

Interroll SA (Proprietary) Ltd., Johannesburg (ZA)

AMERICAS
FUNCTIONREGION/COUNTRY

MANAGED BY

COMPANY

RCoE, sales, service

USA

S. Page

Interroll Corporation, Wilmington/NC (US)RCoE, sales, service

USA

R. KeelyInterroll Atlanta LLC, Hiram (US)CoE, sales, service

USA

M. Means

Interroll Engineering West Inc., Cañon City (US)Sales, assembly, service

CanadaS. Gravelle

Interroll Canada Ltd., Newmarket/Toronto (CA)Sales, assembly, service

Brazil, Argentina

M. GaioInterroll Logística Ltda., Jaguariuna/São Paulo (BR)

ASIA-PACIFIC

2_INT_GB2015_Corporate-Governance_EN.indd 45

FUNCTIONREGION/COUNTRY

MANAGED BY

COMPANY

RCoE

China

T. Zhang

Interroll (Suzhou) Co. Ltd., Suzhou (CN)

RCoE

China

MK Lo

Interroll Shenzhen Co. Ltd., Shenzhen (CN)Sales, service

China

L. ZhiInterroll Holding Management (Shanghai) Lo. Ltd.

Sales, service

South Korea

S. Jeong

Interroll Korea Corp. Seoul (KR)Sales, service

Japan

G. W. Seng

Interroll Japan Co. Ltd., Tokyo (JP)Sales, assembly, service

ThailandN. Grisorn

Interroll (Thailand) Co. Ltd., Panthong (TH)Sales, service

Singapore, South East Asia

G. W. Seng

Interroll (Asia) Pte. Ltd., Singapore (SG)Sales, assembly, service

Australia

P. CieriInterroll Australia Pty. Ltd., Melbourne (AU)04.03.16 16:18

CORPORATE GOVERNANCE

46

5BOARD OF DIRECTORSMembers of the Board of Directors

From left to rightback row: Stefano Mercorio, Ingo Specht,
Prof. Dr. Horst Wildemann, Philippe Dubois,
Paolo Bottini
front row: Urs Tanner, Kurt Rudolf

2_INT_GB2015_Corporate-Governance_EN.indd 46

Election principles and terms of office
The Board of Directors is composed of at least six
members. These members are elected individually at
the General Meeting of the shareholders for a oneyear term. The shareholders Dieter Specht and Bruna
Ghisalberti or their direct first-generation descendants
are entitled to nominate two representatives (one representative per family) in total, as long as they hold atleast 10 % each of the share capital.

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CORPORATE GOVERNANCE

47

PROFESSIONAL BACKGROUND AND VESTED INTERESTS
OF THE BOARD OF DIRECTORSKURT RUDOLF

STEFANO MERCORIO(born 1942, Swiss)(born 1963, Italian)

Dipl.-Ing. ETH, served as Managing Director of LGZ Landis& Gyr Zug AG and Chief Executive Officer of Portescap
Group. He was a member of the Board of Directors of Medela
Group and a member of the foundation board of the Olle
Larsson-Rosenquist Stiftung. Mr. Rudolf has been Chairmanof the Board of Directors of Interroll Holding AG since 2006
and has been a member since 2001, where he s­erved as its
Deputy Chairman. Since 2006 Mr. Rudolf has also been partof the Compensation Committee.

holds a degree in economics. He is currently working asa ­Legal Auditor and is the founder and Senior Partner of­Studio Castellini Mercorio & Partners. Since 1987 he has­been ­Dottore Commercialista iscritto all “Albo dei Dottori
Commercialisti e degli Esperti contabili di Bergamo”.
Mr. Mercorio has been a member of the Board of Directorsof Interroll Holding AG since 2013.

URS TANNER(born 1951, Swiss)
Executive MBA University St. Gallen, AMP Harvard, served
as CEO of Medela Group, Managing Director of the Tools &Plastics business segment of Mikron Group and held leading
positions with Styner & Bienz AG (Adval Tech). Currently heis a co-owner of Halcyon Associates Inc. in the USA as well asa member of the Board of Directors of Belimed AG and
Neutrik AG. Mr. Tanner has been a member of the Board of
Directors of Interroll Holding AG since 2008 and has been its
Vice Chairman since 2009.

PAOLO BOTTINI(born 1965, Swiss)lic. iur., lawyer and tax specialist (Eidg. Dipl.) held various
positions within the law firm Bär & Karrer and currently is
the Managing Partner of the firm in Lugano. Mr. Bottini has
been a member of the Board of Directors of Interroll Holding
AG and a member of the Audit Committee since 2003.

PHILIPPE DUBOIS(born 1950, Swiss)lic. iur. and lic. oec., was responsible for the IPO of Interroll
Holding AG while working for UBS Warburg. He also held
senior Investment Banking positions at the bank Julius Bär.
­Currently he is an independent management and financial
consultant for M&A, corporate finance and management­coaching. Mr. Dubois has been a member of the Board of­Directors of Interroll Holding AG and a member of the Audit
Committee since 2003.

2_INT_GB2015_Corporate-Governance_EN.indd 47

INGO SPECHT(born 1964, German)
holds a professional qualification as Industrial Business­Manager of Chamber of Commerce and Industry Cologne,
Germany. He was owner and Managing Director of Luxis,
Locarno, and held various senior positions in IT, Marketing
and Business Development within the Interroll Group.
­Currently, he is serving as Managing Director of Interroll SA.
Mr. Specht has been a member of the Board of Directors­since 2006.

PROFESSOR DR. HORST WILDEMANN(born 1942, German)
Dipl.-Ing. in mechanical engineering and Dipl.-Kfm. in business administration, Prof. of university Dr. Dr. h.c. mult.,­serves as Managing Director of TCW Transfer-Centrum for
Production Logistics and Technology Management GmbH &Co. KG, Head of the research institute for management, production and ­logistics at the Technical University of Munich
and a honorary professor at the universities of Klagenfurt,
Passau and Cottbus. He is currently Chairman of the ­Advisory
Board of Möhlen­hoff GmbH and Rudolf GmbH as well as amember of the Advisory Board of Hamberger Industriewerke
AG. He is also a member of the Board of Directors of Sick AG
and Zeppelin GmbH. Prof. Dr. Wildemann has been a member of the Board of Directors of Interroll Holding AG and amember of the Compensation Committee since 1999.

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CORPORATE GOVERNANCE

48

6

INTERNAL ORGANISATION

Constitution and committees of the Boardof Directors
The Board of Directors consists of the Chairman, theDeputy Chairman and the other Members. The Boardof Directors is assisted by two permanent committees
within the areas of auditing (Audit Committee) andremuneration policy (Compensation Committee).
Audit Committee
The Audit Committee receives the audit reports prepared by the local external auditors and by the Groupauditor. It prepares the respective reporting on them tothe Board of Directors. In particular, it ensures that theGroup companies are also being audited on a regular basis. The Audit Committee mandates the ­internal
audit department to execute internal audits and revises
respective audit reports.
At least once a year, the Audit Committee also commissions a report on audits undertaken and planned
as well as on any proposals to improve the auditing
function. The Audit Committee submits its proposals
to the Board of Directors for decision.
Compensation Committee
The Compensation Committee submits its proposals
for the salary and bonus of the CEO, the membersof Group Management, and the compensation of
the Board of Directors to the Board of Directors for
decision. At the beginning of the year, it defines thetargets to be attained for bonus payments to become
applicable. In addition, the Compensation Committee
is responsible for establishing the terms of the shareownership scheme.
Mode of collaboration of the Board of Directors
and its committees
The Board of Directors meets as often as business
requires, but at least four times per year. The meetings
are convened by the Chairman of the Board of Directors. Each member of the Board of Directors may
demand that a meeting be convened, specifying theitem on the agenda to be discussed. The CEO partici­
pates in the meetings of the Board of Directors. The
Executive Vice Presidents of the respective functional
units and the Vice Presidents of the Corporate Functions as well as other members of management are
invited to attend meetings when necessary.
The Board of Directors is deemed quorate if an absolute majority of its members is present in person.
­Resolutions are adopted on the basis of an absolutemajority of votes present. In the event of an equal division of votes, the Chairman casts the deciding vote. All
resolutions are recorded in the minutes.

2_INT_GB2015_Corporate-Governance_EN.indd 48

Both committees of the board meet as necessary. Any
member is entitled to convene committee meetings.
In the business year 2015, the Board of Directors met
on five occasions, the Audit Committee three times
and the Compensation Committee twice for regularscheduled meetings.

7

COMPETENCE REGULATIONS

Statutory base for the competence regulations
All basic competencies and tasks of the organs are
lined out in the Articles of Association of Interroll
Holding Ltd. Responsibilities and duties that cannot betransferred to third parties are defined in these a­ rticles.
Responsibility of the Board of Directors
The Board of Directors is responsible for the Group’s
strategy and governs the overall management, supervision and control over the operational management of the Interroll Group. The Board of Directors
has exercised its statutory authority to delegate­management to third parties who need not be shareholders (Group Management).
Management and organisational regulations
In the provisions of the organisational regulations,
the Board of Directors has delegated the managementof ongoing business to a Chief Executive Officer (CEO).
The CEO is responsible for the overall ­managementof the Interroll Group and for all matters not fallingunder the purview of another governing body, as
specified by law, the Articles of Association or theorganisational regulations. In particular, the CEO
is responsible for the operational management of thecompany as a whole. Competencies and controls are
specified within a set of organisational regulations.

8

INFORMATION AND CONTROLINSTRUMENTS

Reporting to the Board of Directors
At each meeting, the CEO informs the Board of Directors of the course of business, the principal events
within the Group and the discharge of duties delegatedto Group Management.
Management information system
The Management Information System (MIS) of theInterroll Group consolidates the balance sheet, income
statement and cash flow statement, as well as financial data pertaining to the subsidiary companies, on amonthly basis and compares the current figures withthose of the previous year and the budget. On thebasis of the quarterly financial statements, the budget
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CORPORATE GOVERNANCE

49

attainable with regard to each entity and also for the
consolidated group. The financial reports are discussed
during the meetings of the Board of Directors.
Internal audit and control instruments
On behalf of the Audit Committee, internal audits are
performed annually at selected subsidiary companies.
The focal points of the audit are defined according to
the risk profile of the respective entity. The reportsof the Audit Committee are discussed with the local
management.
Extraordinary occurrences and decisions of material importance, as specified in the organisational
regulations, are immediately brought to the attentionof all members of the Board of Directors in writing.

9

GROUP MANAGEMENTThe Group Management of Interroll Group had thefollowing members as of the end of 2015:
NAME/ YEAR OF BIRTH

NATIONALITYFUNCTION

MEMBER SINCEPaul Zumbühl (1957)

Swiss

Chief Executive Officer (CEO)January 2000

Daniel Bättig (1964)

Swiss

Chief Financial Officer (CFO)

March 2013

Dr. Ralf Garlichs (1962)

GermanExecutive Vice President Products & Technology

July 2006

Dr. Chr. Reinkemeier (1966)

GermanExecutive Vice President Global Sales & Service

January 2011

Jens Karolyi (1970)

GermanSen. Vice President Corporate Marketing & Culture

January 2011

Tim McGill (1955)

EnglishExecutive Vice President Operations Americas

January 2011

Dr. Ben Xia (1966)

Chinese

Executive Vice President Operations Asia

June 201310 SHAREHOLDERS’ PARTICIPATIONRIGHTS
Representation and restriction of voting rights
Rights governing shareholder participation are inaccordance with the requirements specified within
the Swiss Code of Obligations. Each share issued has
one vote. A shareholder’s voting rights are restricted
to a maximum of 5 % of the total number of votes.
Individual nominees, however, are entitled to exercise more than 5 % of the total votes if they disclose
the identity of the beneficiaries they represent and if
the ­respective beneficiaries as a whole do not exercise
more than 5 % of the voting rights. This restriction of
voting rights does not apply to the founding families,
insofar as the individual families hold at least 10 %of the share capital.
Registered shares of nominees that exceed 2 % of
the shares outstanding are only listed in the shareregister as shares furnished with voting rights if
the nominee has provided written consent to thepossible disclosure of names, addresses and share-

2_INT_GB2015_Corporate-Governance_EN.indd 49

holdings of those persons for whom the said nominee holds 0.5 % or more of the shares outstanding.
Statutory quorum
Subject to contrary statutory or legal provisions, theGeneral Meeting of Shareholders is quorate irrespective of the number of shareholders present and theshares represented by proxy.
Convocation of General Meeting of
Shareholders
The invitation to the General Meeting of Shareholders
is issued at least twenty days prior to the Meetingand is legally effective upon inclusion in the Company’s
chosen vehicle of communication (“Schweizerisches
Handelsamtsblatt”). In addition, the Board of Directors
sends a written invitation to those registered share­holders listed in the share register.

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CORPORATE GOVERNANCE

50

Agenda and registration in the share register
The invitation to the General Meeting of Shareholders
shall include all items on the agenda as well as all
motions put forward by the Board of Directors and,if applicable, by the shareholders who have called
for a General Meeting or the inclusion of an item on
the agenda. No resolutions shall be passed on motions
relating to items which have not been announced
in the requisite manner, with the exception of thosemotions relating to the convocation of an Extraordinary Meeting of Shareholders or the execution of a
special audit. No entries are made into the share­register less than ten days prior to a General Meetingof Shareholders up to the day subsequent to the­General Meeting of Shareholders.

11 CHANGE IN CONTROL AND
DEFENCE MEASURES
Obligation to make an offer
There are no statutory regulations regarding opting up
and opting out.
Change in control clauses
There are no agreements for severance pay, other agreements and plans in the event of a change in ­control
or upon termination of a contract of employment.

12 AUDITOR
Duration of the mandate and term of officeof the lead auditor
By decision of the General Assembly of 8 May 2015,
Interroll Holding Ltd. has appointed Pricewaterhouse­
Coopers (PwC) for another term of one year as its
auditing company. PwC has been the Group Auditorof Interroll Group since 2011. Mr. Patrick Balkanyi
has been the lead auditor with audit responsibility
since 2012.

Supervisory and control instruments
pertaining to the audit
The Audit Committee is responsible for evaluating
the external audit. The external auditors prepare an
audit report to be submitted to the Board of Directors.
At least two consultations are held each year between
the external auditors and the Audit Committee.
­Material findings for each entity (Management Letters)
as well as for the consolidated accounts are presented
in the “Comprehensive Auditor’s Report to the Boardof Directors”, which is discussed in detail.

13 INFORMATION POLICY
Contact person
Interroll is committed to providing swift, transparent and synchronous information to all stakeholders.
To ensure that, the CEO is available as a direct contact
person.
Published reports on the course of business
Interroll Group publishes comprehensive financial
results twice a year: for the first half and for the financial year as a whole. In addition to the financial resultsthat are carried out in accordance with IAS / IFRS,
shareholders and financial markets are regularly
informed of significant changes and developments.
Source of information
Further relevant information and financial reports
are available on www.interroll.com/investor-relations,where reports can be downloaded. Shareholders
recorded in the share r­egister may ­request to receive
the Annual Report in printed form and register for
automatic delivery of the Annual Report with theInvestor Relations department.

Audit fees
The audit fees charged by PwC to subsidiaries of­Interroll Group in the business year 2015 amounted
to CHF 0.4 million. The audit fees charged by PwC in2014 amounted to CHF 0.4 million.

2_INT_GB2015_Corporate-Governance_EN.indd 50

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REMUNERATION REPORT51

REMUNERATIONREPORT

2_INT_GB2015_Corporate-Governance_EN.indd 51

BASIC REMUNERATION PRINCIPLES 

52

REMUNERATION OF THE BOARD OF DIRECTORS52

REMUNERATION OF GROUP MANAGEMENT54

REPORT OF THE STATUTORY AUDITOR

58

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REMUNERATION REPORT52

The remuneration report provides information about
the principles of Interroll’s remuneration policy, themanagement process and the remuneration of theBoard of Directors and Group Management. It complies
with the requirements of Sections 14 to 16 of the Swiss
ordinance against excessive compensation in listed
stock companies dated 20 November 2013 (VegüV),
the guidelines on corporate governance informationof SIX Swiss Exchange and the principles of the Swiss
Code of Best Practice for Corporate Governance ofEco­nomiesuisse, which came into force on 30 June 2014.

BASIC REMUNERATION PRINCIPLES
A fair, systematic and transparent remuneration system
is aimed at contributing to the long-term developmentof the Interroll Group and to securing its business­success. The Interroll Group’s remuneration system isin line with its corporate strategy and based on appropriately rewarding short-term and long-term targets
which have been achieved. It is aimed at putting­Interroll in a position to attract, develop and retain thebest people in its particular field and sector.
The Interroll Group’s remuneration policy features thefollowing aspects:–– Directors’ compensation exclusively comprises
fixed remuneration. In this way, Interroll
ensures the corporate body’s independence in its
super­vision of Group Management.
–– The ratio of fixed to variable remuneration formembers of Group Management is appropriate andthe level of the respective elements does not­fluctuate excessively in order to prevent excessive variable remuneration components from­negatively influencing individuals’ willingness totake risks or resulting in a short-term approach.
–– Remuneration must be commensurate with the
responsibility, quality of the work and individual
workload of the relevant role.
–– In addition, remuneration is to ensure appropriate
and competitive compensation based on the value
contribution, the role and individual performance.
–– As a component of the remuneration for members of Group Management, share plans are aimed
at rewarding the achievement of long-termGroup ­targets in the interests of shareholders andpromoting long-term corporate performance.
The Board of Directors is responsible for the prin­ciples of the Group’s remuneration policy and management process and is supported by the Compensation
Committee in the fulfilment of this responsibility. The
Board of Directors decides on the total remuneration
for the Board of Directors as well as Group Manage-

2_INT_GB2015_Corporate-Governance_EN.indd 52

ment and presents a proposal to the Annual General­Meeting for approval, starting with financial year 2015.
On behalf of the Board of Directors, the Compensation Committee prepares all proposals and the basis forremuneration decisions to be taken.
The Compensation Committee’s key duties are as
follows:–– Propose and regularly review Interroll Group’s
remuneration policy–– Propose and develop remuneration regulations for
the Board of Directors and Group Management–– Propose and specify the remuneration principles forthe following financial year–– Propose the remuneration for members of theBoard of Directors–– Propose the remuneration for the CEO and,at the CEO’s request, the remuneration of the othermembers of Group Management–– Propose employment terms and conditions, material
amendments to existing contracts of employment
with members of Group Management as well asother strategic HR decisions
At the Annual General Meeting of Interroll Holding AG
on 13 May 2016, the Board of Directors will propose
the total remuneration of the Board of Directors forthe period up to the 2017 Annual ­General Meetingand the total remuneration for Group Management for
the financial year 2016 for approval. The voting rules
authorising the remuneration of Board of Directors
and Group Management are included ­in the Articles of
Association of the Company approved during the last
Annual General Meeting.

REMUNERATION OF THE BOARD
OF DIRECTORS
Principles and specifying the remuneration
Remuneration paid to members of the Board of Directors is fixed, commensurate with their responsibilities
and paid in cash. No variable components are included.
In this way, Interroll ensures the independence of theBoard of Directors in its supervision of Group Management. The remuneration depends on the workload
and responsibilities of the Board of Directors. It takes
into account market conditions and is based on thecomparative values from other listed Swiss mediumsized industrial companies with international activities.
All remuneration paid to members of the Board of Directors of Interroll Holding AG by Interroll H­ olding
AG and the subsidiaries over which it has direct orin­direct control is decisive in determining annual
remuneration.

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REMUNERATION REPORT

53

Every year, the Board of Directors determines the fixed
remuneration of the members of the Board of Directorsof Interroll Holding AG for the period of time up to thenext Annual General Meeting of Interroll Holding AG
on the basis of the remuneration regulations and at theCompensation Committee’s request, subject to approvalby the Annual General Meeting. No separate remuneration is paid to members of committees. Extraordinary
efforts that go beyond the normal duties of the Board of
Directors may be additionally compensated. All social
security contributions are made by the employer.
Fixed-term contracts of employment and mandate
agreements for members of the Board of Directors may
be for a fixed contractual term of up to one year.
Total remuneration for 2015 (audited)
Compensation paid to members of the Board of Directors is disclosed in accordance with VegüV and OR 663c
as follows:
Cashin thousands CHF

Shares /Options

SocialSecurity *

Other
Total
Benefits Compensation

Shares held
as of 31.12.

Voting Rights
in %Kurt Rudolf
2015

P, CC

150

18

168

400

0.05

2014

P, CC

150

18

168

500

0.06

Urs Tanner
2015

VP

75

12

87

0.00

2014

VP

75

12

87

0.00

2015

AC

57

9

66

20

0.00

2014

AC

50

8

58

20

0.00

2015

AC

57

9

66

100

0.01

2014

AC

50

8

58

100

0.01

Paolo Bottini

Philippe Dubois

Horst Wildemann
2015

CC

57

5

62

0.00

2014

CC

50

4

54

0.00

2015

57

12

69

0.00

2014

50

10

60

0.00

2015

57

9

66

82,340

10.43

2014

50

8

58

86,695

11.17

2015

510

74

584

82,860

10.49

2014

475

68

543

87,315

11.25

Stefano Mercorio

Ingo Specht

Total Board of Directors

P: Chairman of the BoD; AC: Audit Committee; VP: Vice Chairman of the BoD; CC: Compensation Committee* Social Security costs consist of employers’ and employees’ contributions to the state-run Swiss social security system.

The Board of Directors holds no stock options withre­spect to Interroll Holding AG shares.

2_INT_GB2015_Corporate-Governance_EN.indd 53

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REMUNERATION REPORT

54

Valuation of total remuneration for 2015
In the reporting year, the remuneration of the Boardof Directors comprised no non-recurring effects. Nochange has occurred compared with the previous year.
At the 2015 Annual General Meeting, the Board of
Directors will propose the same remuneration as in
the past period.
Other remuneration (audited) and additional
information
No further payments in cash or in kind are made orother remuneration, e.g. commission for the takeoveror transfer of companies or parts thereof, is paid tomembers of the Board of Directors.
Severance pay for members of the Board of Directors
is not permitted, whereby remuneration due to members up to the end of the contractual term does notconstitute severance pay.
Loans (audited)
Interroll Holding AG and its subsidiaries granted noloans and advances to members of the Board of Directors in the two reporting years. There were no loans
from past years.

REMUNERATION OF GROUPMANAGEMENT
Principles and specificationof total remuneration
For each Group Management member an individual
remuneration agreement exists, the projected total
remuneration, which is based on the criteria specified
below for determining the remuneration and market
conditions in the relevant country. The projected total
remuneration comprises a fixed and a variable remuneration component and may be exceeded as a resultof excellent performance. The Group Management’s
actions must always focus on achieving a long-termsustained increase in value rather than pursuing shortterm profit maximisation. The composition of total
remuneration for the members of Group Management in general and the CEO in particular is based on
this aim.
Total remuneration is determined on the basis of key
criteria, such as global responsibility in the relevantrole, individual actual performance contributing to
the Group’s long-term strategic development, the complexity of the area of responsibility and the personal
results achieved on behalf of the Group.

2_INT_GB2015_Corporate-Governance_EN.indd 54

External consultants may additionally be involved indetermining the structure and level of remuneration
on a case-by-case basis. As part of the Group’s reorganisation and the appointment of a new Group Management in 2011–2013, market comparisons were madewith the help of the relevant recruitment consultants
and used in determining the level of remuneration
when recruiting staff in Europe, America and Asia.
Furthermore, comparisons were made on the basisof a detailed up-to-date Kienbaum salary study and a
Towers Watson salary survey.
In determining the annual total remuneration, allremuneration paid to members of Group Management by Interroll Holding AG and the subsidiaries
over which it has direct control is taken into account,irrespective of whether global or local activities for one
or more subsidiaries in Switzerland or abroad (basedon a separate contract of employment) of the respective
member of Group Management are compensated.
On the basis of the remuneration regulations and at
the Compensation Committee’s request, the Board of
Directors specifies the total remuneration of GroupManagement every year, subject to approval from theAnnual General Meeting from 2015 onwards. The
Compensation Committee works out the CEO’s total
remuneration. The CEO works out the total remuneration of the other members of Group Management and submits his proposal to the Compensation
Committee every year for approval by the Board of
Directors. At the Annual General Meeting of Interroll
Holding AG on 13 May 2016, the Board of Directors
will present for the first time a proposal for total remuneration of Group Management for financial year 2016
for approval.
Fixed remuneration
The fixed remuneration component of total remuneration is contractually stipulated and generally remains
unchanged for three to four years if the job does notchange. Adjustments may be made on the basis of theassessment of individual performance and in the eventof changes to the area of responsibility.
Variable remuneration
The maximum possible share of variable remuner­
ation amounts to approx. 60 % of total remuneration
for members of Group Management in an operating
managerial role and approx. 30 % for members in acentralized holding role. In the reporting year, the variable share in relation to total remuneration of GroupManagement amounted to 40 %.

04.03.16 16:18

REMUNERATION REPORT55

The calculation basis for variable remuneration includes the measurable sustained financial success (ofthe company or a part thereof) and annual individual
targets, which must be measurable and of considerable
strategic significance.
The company’s financial success used to calculate thefinancial success component of variable remuneration is measured in terms of the key figures listed
below, compared with the previous year and a rolling
3-year plan:
Operating profit (EBITDA), operating profit margin(EBITDA in % of sales), gross margin (in % of sales),sales growth (growth compared with forecast and /orprevious year) and return on net assets (RoNA).
Specific key figures may be weighted differently or disregarded, depending on the company’s strategic position or the role of each member of Group Management.
As a rule, the weighting of the financial success component in variable remuneration amounts to at least
66 % for members of Group Management in an operating managerial role and at least 33 % for membersof Group Management in a centralized holding role.
For the individual targets component, between 3 anda maximum of 5 individual measurable targets areagreed every year, with either the same or a different
weighting. These targets must make an important contribution to the current or long-term success of theGroup or parts thereof. They relate, for example, to new
products, gaining market share, developing new markets, the successful integration of a business acquired,successful strategic projects, the achievement of inventory reduction targets etc.

Allotment of shares
The Interroll shares granted as part of fixed (CEO) andvariable remuneration to members of Group Management are blocked for four to eight years. The blocking
period is aimed at motivating Group Management
to perform its duties in the interests of the Interroll
Group’s long-term ­sustainable development rather thanshort-term profit maximisation.
Based on their commitment and influence, GroupManagement members are to participate long-termin the Group’s increased value and also share the business risk as shareholders (and equity co-investors).
In this sense, the share plan for Group Management
represents a long-term performance incentive and isintended to promote identification with and loyalty toInterroll in the long run.
The conversion rate for variable remuneration applicable to the number of Interroll shares allotted is the rele­vant share price on 31 December of the financial year
ended less the deduction permitted for tax ­purposes,
depending on the length of the blocking period. The
members of Group Management decide by 15 December of the relevant financial year ended on the percentage of variable remuneration which they wish toreceive in the form of Interroll shares (min. 20 % ofvari­able remuneration). In the financial year ended,Group Management members held no stock options
entitling them to acquire Interroll ­Holding AG shares.

Using the plan for several years as the basis of variable
remuneration (rather than the budget) motivates
members of Group Management to think long-term.
It means that the relative improvement is measured
compared with the previous year, and short-termcost-cutting is prevented in the areas of market development and innovation etc. which could otherwise
hamper the long-term development of Interroll.
The Compensation Committee may deviate from theagreed variable remuneration in favour of a GroupManagement member if failure to achieve specific­targets was solely attributable to external factors, or if
an exceptional one-off performance was delivered. In
the two reporting years, no deviation from the agreement occurred.

2_INT_GB2015_Corporate-Governance_EN.indd 55

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REMUNERATION REPORT

56

Total remuneration for 2015 (audited)
Compensation paid to members of Group Management is disclosed in accordance with the requirementsof Sections 14 to 16 of the Swiss ordinance against
excessive compensation in listed stock companies
dated 20 November 2013 (VegüV), the guidelines on
corporate governance information of the SIX Swiss
Exchange and the principles of the Swiss Code of Best
Practice for Corporate Governance of Economiesuisse, which came into force on 30 June 2014 as follows:
Remuneration (net)in thousnads CHF

Fixed

Variable *Equity-based compens.
Shares **Options

SocialSecurity ***

Other
Total
Benefits Compensation

CEO (highest)
2015

661

856

389

520

43

2,469

2014

663

792

390

508

43

2,396

Other members
2015

1,347

407

341

258

118

2,471

2014

1,429

471

226

262

94

2,482

Total Group Management
2015

2,008

1,263

730

778

161

4,940

2014

2,092

1,263

616

770

137

4,878

*

The difference between provisions made in the previous year and the actually paid-out bonuses is netted with the variable compensation
planned for the year under review.

** In the period under reivew 2,043 (previous year: 1,769) own shares were attributed. 2,043 of these shares (previous year: 1,769) may not besold for a period of four to eight years as of grant date. Share-based payments correspond to tax values.
*** Social security costs consist of employers’- and employees’ contributions to the state-run Swiss social security system.

Explanations regarding the calculation method
The calculation method under IFRS differs in two
aspects from the calculation of remuneration andshareholdings of members of the Board of Directors
and Group Management in accordance with OR 663(bis) and OR 663c:–– Compensation for company cars under IFRS isbased on the expenses including depreciationand lease instalments stated in the annual accounts.
Under the OR, a rate of 0.8 % per month of theacquisition cost of the vehicles is used.
–– Under IFRS, share-based remuneration is determined at market value on the allotment date. Under
the OR, shares are valued at their taxable value,
which is derived from the market value. As a resultof the blocking period, the taxable value decreases
compared with the market value according to theblocking period defined.
–– The difference of CHF 0.39 m (previous year:
CHF 0.32 m) related to company cars – CHF 0.07 m(previous year: CHF 0.08 m) – and share-based
remuneration – CHF 0.32 m (previous year:
CHF 0.24 m).

2_INT_GB2015_Corporate-Governance_EN.indd 56

Valuation of total remuneration for 2015
Due to the high achievement of financial and individual objectives total remuneration to Group Management in the reporting year was higher than in theprevious year in local currencies, but about equal tothe previous year expressed in Swiss francs. However,it was significantly lower than the maximum totalcompensation of CHF 5.8 million approved during
the Annual General Meeting in 2015 (incl. share-based
compensation at market and at tax value at the granting date).

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REMUNERATION REPORT

57

Total remuneration of the last 10 years
The table below indicates total remuneration of GroupManagement from 2006 to 2015:
in CHFm

2006

2007

2008

2009

2010

2011

2012

2013

2014

2015

Executive

5.8

5.2

4.4

4.3

4.9

5.0

5.2

4.7

4.9

4.9

* Source: Annual Reports 2006 –14, according to figures in column “Total Compensation” e.g. incl. all pension and other services.

Group Management and the total remuneration ofGroup Management remained at a steady level since2006. During these 10 years, Interroll has advanced to
become the global market leader for key products in
the internal logistics business and market capitalisation was increased by 3 times.
Outlook for total remuneration in 2016
As in the last years, in 2016 total remuneration andits payment depend on target achievement. With
two members of the Group Management the fixed
remuneration increased a bit in 2016 after 3 – 4 yearsof service. Total achievable remuneration presented to
the Annual General Meeting in 2016 assumes maximum target achievement and comprises a reservefor currency fluctuations. The actual amount paid is
usually lower than than the amount approved by the
Annual General Meeting.

No further payments in cash or in kind are made orother remuneration, e.g. commission for the takeoveror transfer of companies or parts thereof, is paid tomembers of Group Management.
Severance pay for members of Group Management is
not permitted, whereby remuneration due to members
up to the end of the contractual term does not constitute severance pay.
The notice periods for members of Group Management range from three to twelve months.
Loans (audited)
Interroll Holding AG and its subsidiaries granted noloans or advances to members of Group Managementin the two reporting years.

Other remuneration (audited) and additional
information
The regulations on expenses and pensions are specified
in the applicable local employment terms and conditions as well as the relevant statutory and ­prevailingmarket conditions of the countries concerned, inparticular Germany, the USA and China as well as
Switzerland.
In Switzerland, each Group Management member
contributes a quarter to a third of the “savings element”
to the pension fund. The rest is paid by the employer.
A company car and mobile phone are made available tothe members of Group Management for business andprivate use. Alternatively, the corresponding amount is
paid as a monthly flat rate. The maximum permitted
limits in terms of the value of company cars are regulated in-house.

2_INT_GB2015_Corporate-Governance_EN.indd 57

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REPORT OF THE STATUTORY AUDITOR58

REPORT OF THE STATUTORY AUDITOR TO THE GENERAL MEETING
INTERROLL HOLDING LTD
Sant’Antonino

We have audited the remuneration report of Interroll Holding AG for the year ended 31 December 2015.
The audit was limited to the information according to articles 14 –16 of the Ordinance against Excessive
Compensation in Stock Exchange Listed Companies (Ordinance) contained in the tables labeled “audited”
on pages 52 to 57 of the remuneration report.
Board of Directors’ responsibility
The Board of Directors is responsible for the preparation and overall fair presentation of the remuneration
report in accordance with Swiss law and the Ordinance against Excessive Compensation in Stock Exchange­Listed Companies (Ordinance). The Board of Directors is also responsible for designing the remuneration­system and defining individual remuneration packages.
Auditor’s responsibility
Our responsibility is to express an opinion on the remuneration report. We conducted our audit in accordancewith Swiss Auditing Standards. Those standards require that we comply with ethical requirements and plan andperform the audit to obtain reasonable assurance about whether the remuneration report complies with Swisslaw and articles 14–16 of the Ordinance.
An audit involves performing procedures to obtain audit evidence on the disclosures made in the remuneration report with regard to compensation, loans and credits in accordance with articles 14–16 of the Ordinance.
The procedures selected depend on the auditor’s judgment, including the assessment of the risks of material
misstatements in the remuneration report, whether due to fraud or error. This audit also includes evaluating thereasonableness of the methods applied to value components of remuneration, as well as assessing the overall
presentation of the remuneration report.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our
opinion.
OpinionIn our opinion, the remuneration report of INTERROLL HOLDING LTD for the year ended 31 December 2015
complies with Swiss law and articles 14–16 of the Ordinance.
PricewaterhouseCoopers AG

Patrick Balkanyi				Remo Zenegaglia
Audit expert				Auditor in charge			

Zürich, 3 March 2016

2_INT_GB2015_Corporate-Governance_EN.indd 58

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FINANCIAL REPORT OF INTERROLL GROUP

59

FINANCIAL REPORTOF INTERROLL GROUP

1

3_INT_GB2015_Finance_EN.indd 59

CONSOLIDATED FINANCIAL STATEMENTS OF INTERROLL

60

1.1

CONSOLIDATED STATEMENT OF FINANCIAL POSITION

60

1.2

CONSOLIDATED INCOME STATEMENT

61

1.3

CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME

62

1.4

CONSOLIDATED STATEMENT OF CASH FLOWS

63

1.5

CONSOLIDATED STATEMENT OF CHANGES IN EQUITY 64

NOTES ON THE FINANCIAL STATEMENT OF INTERROLL GROUP

65

2

GENERAL INFORMATION ON THE FINANCIAL STATEMENTS

65

3

RISK MANAGEMENT

75

4CHANGES TO THE SCOPE OF CONSOLIDATION

78

5

OPERATING SEGMENTS

80

6

NOTES ON THE CONSOLIDATED STATEMENT OF FINANCIAL POSITION

81

7

NOTES ON THE CONSOLIDATED INCOME STATEMENT101

8

OTHER DISCLOSURES ON THE FINANCIAL STATEMENTS

106

9REPORT OF THE STATUTORY AUDITOR

11004.03.16 16:18

CONSOLIDATED FINANCIAL STATEMENTS OF INTERROLL

60

1

CONSOLIDATED FINANCIAL STATEMENTS OF INTERROLL

1.1

Consolidated statement of financial position
see notes*

31.12.2015

Property, plant and equipment

6.1

90,37485,969Intangible assets

6.3

43,16049,874in thousands CHF

in %31.12.2014

in %ASSETS

Financial assets
Deferred tax assets

7.6

626

3,959

4,150

138,119

Total non-current assets
Inventories

626

6.5

Current tax assets
Trade and other accounts receivable

6.6

Cash and cash equivalents

6.7

47.1

44,833

140,61950.6

42,2731,360

457

76,98970,42831,654

24,380Total current assets

154,83652.9

137,538

49.4

Total assets

292,955

100.0

278,157

100.0

EQUITY AND LIABILITIESShare capital

854

Share premium

6,519

6,416

Reserve for own shares–1,623–2,008Translation reserve–55,227–41,104

Retained earnings

257,123
207,646

8,540

228,48670.9

200,330

Total equity

6.10

Non-current financial liabilities

6.12

8

153

Deferred tax liabilities

7.6

4,505

5,286

Pension liabilities

6.15

6,324

5,766

Provisions

6.14

5,893
16,730Total non-current liabilities

72.0

6,000
5.7

17,205Current financial liabilities

6.12

296

317

Current tax liabilities

7.6

11,7848,029

Trade and other accounts payable

6.16

56,4996.2

52,276

Total current liabilities

68,57923.4

60,622

21.8

Total liabilities

85,30929.1

77,82728.0

Total liability and shareholder's equity

292,955

100.0

278,157

100.0* See notes to the consolidated financial statements, which are an integrated part of this year's financial statement.

3_INT_GB2015_Finance_EN.indd 60

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CONSOLIDATED FINANCIAL STATEMENTS OF INTERROLL

61

1.2

Consolidated income statementin thousands CHF

see notes*

Sales
Material expenses
Personnel expenses

6.15 & 7.1

2015

in %

2014

in %

360,738100.0

335,306

100.0–149,900–41.6–143,585–42.8–105,099–29.1–103,507

–30.9

4,194

1.2

1,825

0.5

Increase / (Decrease) in work in progress, finished products
and own goods capitalized
Other operating expenses

7.3–54,057–15.0–55,112–16.4

Other operating income

7.4

2,358

0.7

9,178

2.7

58,23416.1

44,105

13.2

Operating result before depreciation
and amortization (EBITDA)
Depreciation

6.1–10,597–2.9–10,919–3.3

Amortisation

6.3–7,830–2.2–7,805–2.3

39,80711.0

25,381

7.6

Finance expenses

–138

–0.0

–954

–0.3

Finance income

74

0.0

993

0.3

–64

–0.0

39

0.0

39,74311.0

25,420

7.6–10,440–2.9–6,232–1.9

29,303

8.1

19,188

5.7

120

0.0

29,303

8.1

19,068

5.7

Operating result (EBIT)

Finance result, net

7.5

Result before income taxes
Income tax expense

7.6

ResultResult attributable to:– non-controlling interests– owners of Interroll Holding AG
Values per share (in CHF)
Non-diluted earnings (result) per share

6.11

34.51

22.45

Diluted earnings (result) per share

6.11

34.51

22.45

9.00

8.80

Face value reduction / Distribution out of reserves
from capital contributions* See notes to the consolidated financial statements, which are an integrated part of this year's financial statement.

3_INT_GB2015_Finance_EN.indd 61

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CONSOLIDATED FINANCIAL STATEMENTS OF INTERROLL

62

1.3

Consolidated statement of comprehensive incomein thousands CHF

see notes*

Result

2015

in %

2014

29,303

19,188in %Other comprehensive income
Items that will not be reclassified to income statement–840–3,009

Income tax

174

605

Total items that will not be reclassified to income statement–666–2,404–14,123

4,359

statement in the future–14,123

4,359

Other income–14,789

1,955

Comprehensive income

14,514

21,143Remeasurements of pension liabilities

6.15

Items that may be subsequently reclassified to income
statement in the future
Currency translation differences
Total items that may be subsequently reclassified to income

Result attributable to:– non-controlling interests– owners of Interroll Holding AG

14,514

4.0

120

0.0

21,023

6.3* See notes to the consolidated financial statements, which are an integrated part of this year's financial statement.

3_INT_GB2015_Finance_EN.indd 62

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CONSOLIDATED FINANCIAL STATEMENTS OF INTERROLL

63

1.4

Consolidated statement of cash flows

in thousands CHF

see notes*

Result2015

2014

29,303

19,188

6.1 & 6.3

18,427

18,724

6.2, 7.3 & 7.4

–453

–197

Financial result, net

7.5

64

–39

Income tax expense

7.6

10,4406,232

Changes in inventories–6,167–2,612

Changes in trade and other accounts receivable–12,077–8,958Changes in trade and other accounts payable

8,175

3,889

Depreciation, amortization and impairment
Loss / (gain) on disposal of tangible and intangible assets

Changes in provisions, net

6.14

Income tax paid

–1,451452–7,807–8,148972

926

Other non-cash expenses / (income)

764–1,701

Cash flow from operating activities

40,19027,756

Personnel expenses on share-based payments

7.1

Acquisition of property, plant and equipment

6.1–21,179–13,750

Acquisition of intangible assets

6.3–3,134–1,645Acquisition of financial assets
Proceeds from disposal of property, plant and equipment

6.2

–20

1,344

1,165

14

Settlement of loans receivable
Acquisition of subsidiaries, net of cash acquired

–46

156
–1,4304

74

107–22,927–15,417–7,661–7,493Purchase of own shares–900–1,123

Sale of own shares

381

Interests received
Cash flow from investing activities
Distribution out of reserves from capital contributions
Purchase of shares of subsdiaries

–367

4

Proceeds from financial liabilities

13

33

Repayment of financial liabilities

–156

–382

–32

–42

Cash flow from financing activities–8,355–9,374

Translation adjustments on cash and cash equivalents–1,634618

Changes in cash and cash equivalents

7,274

3,583

Interests paid

Cash and cash equivalents at 1 January
Cash and cash equivalents at 31 December

6.7

24,38020,79731,654

24,380* See notes to the consolidated financial statements, which are an integrated part of this year's financial statement.

3_INT_GB2015_Finance_EN.indd 63

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CONSOLIDATED FINANCIAL STATEMENTS OF INTERROLL

64

1.5

Consolidated statement of changes in equity

in thousands CHF

see notes* Share Capital

Share
Premium

Reserve forown shares

Translation
Reserve

Retained
Earnings

Noncontrollinginterests

Total equity

8,540

13,740–1,641–45,463

211,924

145

187,245

19,068120

19,188120

21,143

Balance at 1 January 2014
ResultOther comprehensive income,net of taxes

4,359–2,404

Total comprehensive income

4,359

16,664

1,955

Distribution from reserves
Share-based payments–7,493–7,493from capital contributions, net

169

7.1

756

925

–1,123–1,123

Sale of own sharesincl. tax effects

6.10

Purchase of own sharesincl. tax effects

6.10

Acquisition of–265

non-controlling interests
8,540

Balance at 31 December 2014

6,416

–2,008–41,104

Result228,486

200,330

29,30329,303

Other comprehensive income,net of taxes–14,123–666–14,789

Total comprehensive income–14,123

28,637

14,514–7,686

Face value reduction, net
Share-based payments

25–7,661

7.1

–15

987

972

6.10

118

273

391

6,519

–1,623

Sale of own sharesincl. tax effects
Purchase of own sharesincl. tax effects
Balance at 31 December 2015

–900

–900

6.10

854

–55,227

257,123

207,646* See notes to the consolidated financial statements, which are an integrated part of this year's financial statement.

3_INT_GB2015_Finance_EN.indd 64

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

GENERAL INFORMATION TO THE FINANCIAL STATEMENTS

65

2

GENERAL INFORMATION ON THE FINANCIAL STATEMENTS

2.1

Convention of preparation

General notes on the convention of preparation
The 2015 consolidated financial statements of Interroll Group are based on the annual financial statements of Interroll Holding Ltd.,Sant’Antonino and its subsidiaries as of 31 December 2015, drawn up according to uniform Group accounting principles. The consolidated financial statements present a true and fair view of the financial position, results of operations and cash flows in accordance with
the International Financial Reporting Standards (IFRS) and comply with Swiss law.
The consolidated financial statements are based on historical cost except for marketable securities, investments not involving significant
influence and derivative financial instruments, which are stated at fair value.
The preparation of financial statements in conformity with IFRS requires management to make judgments, estimates and assumptions
that affect the application of policies and reported amounts of assets and liabilities, income and expenses. These judgments, estimatesand assumptions are based on historical experience and other factors that are believed to be reasonable under the given circumstances.
Actual results may differ from these estimates.
The estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting ­estimates are recognized in the
period in which the estimate is revised if the revision affects only that period or in the period of the revision and future periods if therevision affects both current and future periods.
Judgments made by management in the application of IFRS that have a significant effect on the consolidated financial statements andestimates with a significant risk of material adjustment in the next years are disclosed under “2.2 – Critical accounting estimates andjudgments.”
New and amended IAS / IFRS standards and interpretations coming into effect in 2015
The Group’s results are in line with IAS / IFRS standards and interpretations. Thus, the Group regularly monitors the amendments andnew standards published by the International Accounting Standards Board (IASB).
As per 1 January 2015 the Interroll Group has adopted new IASB standards and interpretations (IAS 19 and the annual improvement
project). There was no significant impact on the disclosure and reporting from these on the annual financial statements.
Future new or revised IAS / IFRS standards and interpretations
The following new or revised standards and interpretations were enacted before the balance sheet date but will come into force later.
Interroll does not early adopt these standards and interpretations in its consolidated financial statements.
The IASB has published new and revised standards and interpretations. These come into force on or later than 1 January 2016 and are
not early adopted in this financial statement. The impact of the introduction / amendment of IFRS 9 (Financial Instruments), IFRS 10
and IAS 28 (Group closing and investments into associated companies and joint ventures), IFRS 11 (Joint Arrangements), IFRS 15(Revenue Recognition) as well as IAS 16 and IAS 38 (Clarification on acceptable depreciation methods) cannot yet be assessed with
sufficient certainty.
Therefore, Group Management analyzes potential effects of other new or amended standards and interpre­tations on the consolidated financial statement. Interroll Group closely follows discussions on IAS / IFRS standards and checks potential effects on groupfinan­cial statement or disclosure requirements. At the time being, the Group expects only minor impacts in the presentation of
the financial statements and no material impact on the annual financial statements except regarding IFRS 15, revenue from contracts
with customers.

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The new standard on the recognition of revenue (IFRS 15) applies to all contracts with customers exept those that are financial instruments, leases or insurance contracts. IFRS 15 is based on a five step approach: 1) Identify the contract with the customer, 2) Identify
the separate performance obligations in the contract, 3) Determine the transaction price, 4) Allocate the transaction price to separate­performance obligations, 5) Recognize revenue when a performance obligation is satisfied. To what extent IFRS 15 will require Interroll
to redefine the revenue recognition, to adjust the invoicing and accounting systems and to renegotiate contracts with the clients and theoverall impact on the consolidated financial statements of Interroll is being assessed at the moment.

2.2 Critical accounting estimates and judgments
When preparing the consolidated financial statements, Group Management and the Board of Directors must make estimates andassumptions concerning the future. The resulting accounting estimates have an impact on the Group’s assets, liabilities, income andexpenses. Also, these estimates have an impact on the presentation of financial statments. Estimates made are assessed continuously andare based principally on historical experiences and other factors. The resulting accounting estimates can, by definition, deviate from theactual outcome.
The estimates and assumptions that have a significant risk of causing a material adjustment to the carrying amount of assets and­liabilities within the next financial years are discussed below:a) Income tax expense
The Holding company and its subsidiaries are subject to income taxes in various countries. Significant judgment is required in determining the required worldwide provision for current and deferred income taxes and the realization of tax losses carried forward. There
are many transactions and calculations made for which the final tax determination is uncertain in the year under review. In case final
tax assessments or tax audits of such matters are different from the amounts that were initially recorded, such differences may materially
impact income tax expenses of the current period. The assessment of deferred tax assets is done with reference to business plans.
­Capitalized effects of losses carried forward are subject to annual review. Losses carried forward are only capitalized if they are usable
under valid fiscal law in respective countries. The relevant figures are outlined in note 7.6.
b) Recoverable amount of goodwill, patents and licenses
The assessment of the recoverable amount of goodwill and other intangible assets is, by definition, ­subject to uncertainties regarding
expected future cash flows. It requires making adequate assumptions a­ nd ­calculating parameters. We refer to comments made undernote 6.3 that also includes the relevant carrying amounts.
c) Provisions
Liabilities from warranty are a result of the operational business of the Group. These provisions are accrued at balance sheet datebased on historical experience. The actual cash flow can be lower or higher, or specific requests can be covered by insurance.
The assessment of provisions and pension liabilities is, by definition, subject to uncertainties regarding future cash flows. It requires
making assumptions and determining parameters, whose adequacy will ­only become clear in the future. We refer to comments madeunder notes 6.14 and 6.15, which also include the relevant carrying amounts.

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2.3

Principles of consolidation and valuation

General notes on the principles of consolidation
The consolidated financial statements of Interroll Holding Ltd. include the parent company’s financial statements and the financial
statements of all directly or indirectly held Swiss and foreign subsidiaries where the parent company holds more than 50 % of the voting
rights or effectively exercises control through other means.
The full consolidation method is applied, whereby the assets, liabilities, income and expenses are fully i­ncorporated. The proportion of the
net assets and net income attributable to minority shareholders is ­presented separately as non-controlling interests in the consoli­dated
statement of financial position, the consolidated income statement and the consolidated statement of comprehensive income. Accounts
payable to, accounts receivable from, income and expenses between the companies included in t­ he scope of consolidation are eliminated.
Intercompany profits included in inventories of goods produced are also eliminated.
Subsidiaries acquired during the year are included in the consolidated financial statements from the date on which control is obtained,
while subsidiaries sold are excluded from the consolidated financial statements from the date on which control is given up. The capitalconsolidation at acquisition date is carried out using the purchase method. The acquisition price for such a business combination isdefined by the sum of assets and liabilities acquired or incurred, measured at fair value, and of the sum of equity instruments issued.
Transaction costs related to a business combination are expensed. The goodwill resulting from such a business combination is to be recognized as an intangible asset. It corresponds to the excess of the sum of the acquisition price, the amount of non-controlled i­nterestsof the entity acquired, the fair value of equity instruments already held, liabilities and contingent liabilities at fair value. For the valua­tion of non-­controlled interests there are options per transaction. Either the non-controlled interests is valued at fair value or basedon the proportion of the net assets acquired at fair value related to the non-controlled interests. Any negative goodwill is immediately
recognized in the income statement after review of the fair value of the net assets acquired and set off against the purchase price. The
goodwill is subject to a yearly impairment test or even earlier, if indications for an early impairment test exist.
Changes in the amount of holding which do not result in a loss of control are considered to be transactions with equity holders. Any­difference between the acquisition price paid or the consideration received and the amount by which the non-controlled interests value
is adjusted, is recognized in the equity.
Investments in associates are investments where the parent company is either (directly or indirectly) entitled to 20 % – 50 % of
the voting rights or has considerable influence through other means. Investments in a­ ssociates are accounted for by applying theEquity Method. Under this method, the investment is initially recorded at the purchase price and subsequently increased or decreasedby the share of the associate’s profits or losses incurred after the acquisition, adjusted for any impairment losses. The Group’s shareof ­results of associates is recognized in the income statement and in the statement of comprehensive income under share of profit
and loss of associates. Goodwill included in the purchase price, representing any excess of consideration over the Group’s sharein net assets of the associate, is recognized as part of the investment’s carrying amount. Dividends received during the year reducethe carrying amount of such investments.
Investments of which the Group does not hold a significant position of voting rights or of which the Group holds less than 20 % are notconsolidated but stated at their estimated fair value. Such investments are p­ resented under financial assets at their estimated fair value.
Any fair value adjustments are recognized in ­retained earnings. Fair value adjustments are recycled through the income statement at
the date of disposal.

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Foreign currency translation
The consolidated financial statements are presented in Swiss Francs (CHF). All assets and liabilities of the consolidated foreign­subsidiaries are translated using the exchange rates prevailing at the closing date. ­Income, expenses and cash flows are translated at
the average exchange rates for the year under review. The foreign currency translation differences resulting from applying different
translation rates to the statement of financial position, the income statement and the statement of comprehensive income are added toor ­deducted from the line translation reserve of the equity. The same principle is applied for those resulting from the translation of thesubsidiaries’ opening net asset values at year end rates and those arising from long term intercompany loans (net investment approach).
Transactions in consolidated entities where the transaction currency is different from the functional currency of the entity are recorded
using exchange rates prevailing at the time of the transaction. Gains or ­losses arising on settlement of these transactions are included in
the income statement. Monetary assets and liabilities denominated in foreign currencies are translated using the exchange rates prevailingat year end (closing date). Any gains or losses resulting from this translation are also recognized in the income statement.
The following most important exchange rates were used for the translation of financial statements denominated in foreign currencies:
Income Statement (average rates)

Balance sheet (Year end rates)

2015

2014

Change in %31.12.2015

31.12.2014

Change in %
–9.8

1

EUR

1.065

1.213

–12.2

1.084

1.202

1

USD

0.964

0.920

4.9

0.995

0.990

0.5

1

CAD

0.748

0.829

–9.9

0.717

0.855

–16.2

1

GBP

1.470

1.511

–2.7

1.476

1.544

–4.4

1

SGD

0.700

0.724

–3.3

0.703

0.749

–6.1

1

CNY

0.153

0.149

2.9

0.153

0.160

–3.8

1

JPY

0.008

0.009

–7.0

0.008

0.008

0.0

1

PLN

0.254

0.289

–12.2

0.254

0.281

–9.7

1

THB

0.028

0.028

–1.1

0.028

0.030

–8.3

1

ZAR

0.075

0.085

–11.3

0.064

0.086

–25.4

1

DKK

0.143

0.163

–12.3

0.145

0.162

–10.1

1

AUD

0.718

0.824

–12.9

0.727

0.811

–10.3

1

CZK

0.039

0.044

–11.4

0.040

0.043

–7.6

1

BRL

0.288

0.390

–26.2

0.251

0.373

–32.7

100

KRW

0.085

0.087

–2.6

0.085

0.091

–6.8

Current / Non-current distinction
Current assets are assets expected to be realized within one year or consumed in the normal course of the Group’s operating cycle, orassets held for trading purposes. All other assets are classified as non-current assets.
Current liabilities are liabilities expected to be settled by use of cash generated in the normal course of the Group’s operating cycle or
liabilities due within one year from the reporting date. These also include short-term borrowings made as part of credit limits granted
for an indefinite period, but subject to a termination period of less than one year from reporting date. All other liabilities are classified
as non-current liabilities.

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Segment reporting
Since 1 January 2011, Interroll Group consists of one single business unit. The complete product range is sold in all markets through therespective local sales organizations. The customer groups that are OEM’s (original equipment manufacturers), system integrators andend users are taken care of with tailor-made product offerings and differentiated consulting levels. The Interroll manufacturing units
focus on the production of specific product ranges. Assembly units receive semi-finished products from the manufacturing units andassemble a wide product range for their local markets. The Interroll Research Center, which is centrally ­located, develops new application­technologies and new products for all product groups. The manufacturing units continuously refine the current product ranges they arefocused on.
Group Management and the Interroll management structure are organized by functions (Overall ­Man­agement, Products & Technology,
Global Sales & Service, Corporate Marketing and Corporate Finance). The financial management of the Group by the Board of Directors
is effected on one hand by turnover according to product groups and geographical markets and on the other hand by the reporting of
the consolidated financial statements. Group Management additionally assesses the achievement of financial and ­qualitative ­targets of
all legal entities.
Based on the current management structure, financial reporting to the chief operating decision makers is carried out in one reportablesegment which is equal to the consolidated statements of the Group.
Statement of cash flows
The statement of cash flows presents, net of any foreign exchange rate effects, changes in cash flows during the year classified by o
­ perating,investing and financing activities, thereby providing information about the changes of cash and cash equivalents during the reporting
period. Cash equivalents are held for the purpose of meeting the Group’s short-term cash commitments rather than for investment or
any other purposes. The effect of foreign exchange rate changes on cash and cash equivalents in foreign currencies is disclosed separately.
Net cash from operating activities is determined using the indirect method, whereby the net result f­ or the year is adjusted for:a) effects of transactions of non-cash nature;b) deferrals or accruals of past or future operating cash receipts or payments;c) items of income or expense associated with investing or financing cash flows.
Impairments
The carrying value of long term non-financial assets except assets from retirement benefits and assets from deferred taxes are assessedat least once a year. If indications for an impairment exist, a calculation of the ­recoverable amount is performed (impairment test). For
goodwill, other intangible assets with an indefinite useful lifetime and intangible assets which are not yet available for use, the recoverable
amount is calculated regardless of the existence of indications of a decrease in value. If the carrying value of such an asset or the cash
generating unit to which such an asset belongs is to exceed the recoverable amount, an adjustment is recognized through the income
statement. Impairments on a cash generating unit or a group of cash generating units are first adopted on the goodwill and are thereafter
proportionally split onto the other assets of the unit (or the Group).
The recoverable amount is the higher value of fair value less selling costs and value in use. The estimated ­future discounted cash flows
are evaluated to determine the value in use. The discounting rate applied ­corresponds to a pre-tax rate which reflects the risk related tothe assets. If an asset does not largely generate independent cash flows, the recoverable amount of the cash generating unit is calculated
to which the ­asset concerned belongs to.
Impairments on the remaining assets are reversed if the estimations made in the calculation of the r­ ecoverable amount have changed
and either has resulted in a reduction of the impairment amount or no impairment is required anymore. An appreciation in value of the
goodwill may not be performed.

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Derivative financial instruments
Derivative financial instruments are stated at fair value. The method of recognizing gains or losses depends on the type of the underlying
transaction. The Group designates certain transactions with derivatives as either hedges of the fair value of recognized assets or liabilities(fair value hedges) or hedges of highly probable forecasted financial transactions (cash flow hedges). The Group documents at the
inception of the transaction the relationship between hedging instruments and hedged items within the context of its risk management
objective and strategy. The Group also documents its assessment of the effectiveness of the d­ erivatives at acquisition and during its termin relation to both, the values hedged or also in view of future cash flows.
Changes in fair value are recognized as follows:a) Fair value hedges
Changes in the fair value of derivatives designated and qualified as fair value hedges are recorded in the income statement, together withany changes in the fair value of the hedged assets or liabilities.
b) Cash flow hedges
Changes in fair value of derivatives designated and qualified as cash flow hedges are recognized in equity. Amounts accumulated inequity are recycled to the statement of comprehensive income in the periods when the hedged item will affect profit or loss. When ahedging instrument expires or is sold, or when a hedge no longer meets the criteria for hedge accounting, any cumulative gain or loss
existing in equity at that time remains in equity and is recognized when the initial transaction is ultimately recognized in the income
statement. When a forecast transaction is no longer expected to occur, the cumulative gain or loss that was reported in equity is immediately transferred to the income statement.
c) Other securities or financial instruments
Certain derivatives do not qualify for hedge accounting. Changes in the fair value of such hedging instruments are recognized immediately in the income statement. The fair value of derivatives traded in public markets is based on quoted market prices at the balance
sheet date. The quoted market price used for fi­ nancial assets is the current bid price; the appropriate quoted market price for financial
liabilities is the current ask price. The fair value of derivatives which are not traded publicly (for example, “over-the-counter” derivatives)is determined by a valuation provided by the financial institution from which the derivative has been acquired.

2.4

Accounting principles: statement of financial position

Property, plant and equipment
Property, plant and equipment are stated at cost less accumulated depreciation and any impairment losses. Non-current assets acquiredby way of finance leases are recognized at the lower of the present value of f­ uture minimum lease payments and fair value, and depreciatedaccordingly. The related leasing liabilities are presented at their present value.
Depreciation is recognized on a straight-line basis over the estimated useful life and considering a potential residual value. The following
useful economic life terms apply to the Group’s main asset categories:
Buildings
Machinery
VehiclesOffice machines and furniture
Tools and moulds
IT infrastructure

25 years
10 years
5 years
5 years
5 years
3 years

Land is not depreciated.
Components of major investments in fixed assets with different estimated useful lives are recognized s­ eparately and depreciated accordingly.
Estimated useful lives and estimated residual values are revised on a yearly basis as per reporting date and resulting adjustments arerecorded in the income statement.

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71

Assets under construction which completion has not yet been concluded or which cannot be used yet are capitalized based on incurredcosts as per closing date. Respective depreciation is recognized when the construction can be used.
Interests directly related to the acquisition or construction of property, plant and equipment is capitalized and allocated to the related
asset.
Intangible assets
Intangible assets include goodwill, intangible assets purchased in the course of business combinations (­ patented and unpatented technology, customer relationship), licenses and patents and similar rights ­acquired from third parties as well as software acquired fromthird parties. These assets are stated at cost value and are amortized on a straight-line basis over the following, expected useful lifetime:Standard software
ERP software
Customer relationshipPatents, technology and licenses

3 years
8 years
5–10 years
6 years

Acquired customer relationships are customer values identified within the scope of IFRS 3. They are amortized based on their estimatedmelt-off time being a period of 5 to 10 years. In markets in which Interroll holds a solid market position, customer value is amortizedover 10 years. A shorter amortization period is defined in markets with stiff competition.
Patents and technical know-how are amortized over their expected useful life. In view of the innovative market and competitive­environment the amortization period has been determined to be 6 years.
Furthermore, intangible values acquired within business combinations may be identified. Such result from individual contractual­agreements. These values are amortized over the period derived from the c­ ontractual agreement.
Goodwill with an indefinite useful life is allocated to specific cash generating units in order to allow the identification of possible impairment. Such impairment tests are carried out on an annual basis and any impairment is recognized in the income statement. Goodwill­arising from the acquisition of a foreign entity is attributed to that entity’s net assets and reported in the functional currency of that
entity being translated to the Group’s reporting currency at the year end rate.
Financial assets
Financial assets mainly comprise loans receivable that are stated at amortized cost less any valuation a­ llowance. The recognition of interest
income is based on the effective interest rate method.
Non-current assets held for saleTangible assets or a group of assets are classified as “non-current assets held for sale” if their carrying value will most probably be realized
in a divestment transaction rather than by being used in the normal course of business. Such assets are brought actively onto market
and should be sold within one year. Non-current assets held for sale are presented at the recoverable amount, which is the lower of bookvalue or fair value less costs to sell.
Inventories
Inventories are stated at the lower of cost (purchase price or Group production cost) and net realizable value. The cost of inventories
is calculated using the weighted average method. Production overheads are allocated to inventories on a proportional basis. Slow
moving goods and obsolete stocks are impaired. Intercompany profits included in inventories are eliminated by affecting net result.

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72

Trade and other accounts receivable
Trade and other accounts receivable are stated at amortized cost, generally equalling nominal value. The amount of valuation adjustments corresponds to the difference between the carrying amount and the net present value of the future estimated cash flow. The
valuation adjustments include individual impairment for specifically identified positions, where indication exists that the outstanding
amount might not be fully recovered.
Collective impairment covers expected losses that cannot be excluded based on historical data and payment statistics. As soon as­sufficient evidence is available that the receivable will definitively not be recovered, the related amount is directly written off and offset
with the specific individual impairment respectively.
Marketable securities
Marketable securities are stated at their fair value as of balance sheet date. Unrealized gains and losses are included in the financial result.
Cash and cash equivalents
Cash and cash equivalents include cash on hand, postal and bank accounts, as well as credit balances p­ ayable on demand and deposits
with a residual maturity of not more than 90 days at acquisition date. These balances are stated at nominal value.
Shareholders’ equity
Shareholders’ equity is categorized as follows:a) Share capital
The share capital contains the fully paid in registered shares.
b) Share premiumShare premium comprises payments from shareholders that exceed the par value as well as realized gains / losses including tax on­transactions with own shares.
c) Reserve for own shares
The acquisition price of own shares is disclosed as a reduction of shareholders’ equity. Realized gains and losses on transactions with
own shares are recognized in share premium. Compensation and cash inflows resulting from the issue and subsequent possible exerciseof share options are credited to the Groups’ ­reserves.
d) Translation reserve
Translation reserve consists of accumulated translation differences resulting from translation of group subsidiaries’ financial statementswith a functional currency other than Swiss Franc and of equity-alike intercompany loans. The changes in currency differences is­presented in the consolidated statement of comprehensive income.
e)	Retained earnings
Retained earnings contain non-distributed profits.
Financial liabilities
Loans payable and overdrafts are stated at amortized cost. The recognition of interest expenses is based on the effective interest rate
method.
Provisions
Provisions relate to product warranties and impending losses whose amount and timing is uncertain. They are recognized if theGroup has an obligation based on past occurrences at balance sheet date or a cash drain is probable and can be reliably determined.
The amounts recognized represent management’s best ­estimate of the expenditure that will be required to settle the obligation. Providing
the effect is material, long-term provisions are discounted.

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73

Retirement benefits
The Group sponsors pension plans according to the national regulations of the countries in which it ­operates. All significant pension
plans are operated through pension funds that are legally independent from the Group. Generally, they are funded by employees’ andemployers’ contributions. The foreign p­ ension schemes are normally defined contribution plans whereby the pension expense for aperiod equals the companies’ contributions during that period. The Swiss and French pension schemes have certain ­characteristics ofa defined benefit plan; the financial impact of this plan on the consolidated financial statements is determined based on the Projected
Unit Credit Method.
Trade accounts payable
Trade accounts payable are stated at amortized cost, generally equalling nominal value.

2.5

Accounting principles: income statement

Revenue recognition, income from services
Revenue is generally recognized upon delivery (transfer of risk and use). The Group establishes appropriate warranty provisions­relating to rendered services in order to cover expected claims. Services which the ­Interroll Group performs in direct relation to its
core products sold are recognized upon delivery in net sales.
Material expenses
Material expenses include all costs of raw materials and consumables used, goods purchased and third-­party manufacturing, processing
or conversion of the Group’s products (services purchased).
Product development
Expenditure on research and development is only capitalized when the cumulative recognition criteria of IAS 38 are met. Expenses
for product development include wages and salaries, material costs, depreciation of technical equipment and machinery dedicatedto research and development, as well as proportional o­ verhead costs. Such expenses are included in the respective line item of theincome statement.
Employee participation plans
Certain employees participate in equity-based compensation plans of Interroll Holding Ltd. All equity-based compensation granted
to these employees is valued at fair value at grant date and recognized as personnel expense over the period until vesting date. The fairvalue is calculated on the basis of the binomial method. Discounts granted to beneficiaries on the unconditional purchase of Interroll
shares are recognized in the income statement at grant date. Cash inflows resulting from equity-based participation plans are recognized
as an increase in equity. Cash compensated participation plans are recognized as other liabilities and are valued at fair value at balance
sheet date.
Operating lease expenses
Property, plant and equipment that are held under operating leases are not recognized on the statement of financial position. The
operating lease expense is recognized in the income statement on a straight-line basis over the lease contract period. Operating leaseobligations depending on revenues are estimated and accrued as they become due.

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Financial result
Interest expenses on loans and finance lease liabilities are recognized as financial expenses, whereas interest income on financial assets
is recognized in financial income, both on an accrual basis. Moreover, the ­financial result includes foreign exchange gains and losses
arising from the translation of items of the ­statement of financial position and transactions in foreign currencies as well as changes infair value of ­financial instruments.
Income tax expense
Current income taxes are calculated on the statutory results of the Group companies at the enacted or ­substantively enacted tax rate.
They also include adjustment charges and credit notes issued on previous years’ results.
Changes in deferred taxes are generally recognized in the income tax position, unless the underlying ­transaction has been directly recognized in the other comprehensive income. In such case the related ­income tax is also directly recognized in the statement of comprehensive income or in equity. Temporary differences resulting from initial recognition of assets and liabilities are not recognized in theincome ­statement. Temporary differences on the participation value of subsidiaries are recognized except the parent is able to control
the timing of the reversal of temporary differences and it is probable that the temporary difference will not be reversed in the foreseeable
future. Deferred tax effects from the initial recording of assets / debts related to a transaction that affects neither the taxable result nor
the annual profit are also not registered in the deferred tax expenses or deferred tax income.
Deferred taxes are calculated using local enacted or substantively enacted tax rates. The future benefits of tax loss carry-forwards arerecognized as an asset if it is probable that future taxable profits will be available to realize such benefits.

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75

3RISK MANAGEMENT

3.1 Operational and strategic risk management
Risk management on Group level supports strategic decision making. Operational and strategic risk m­ anagement coordinates andmonitors risks arising from the economic activities of the Group.
A systematic operational and strategic risk analyzis is performed annually by Group Management. In an annual strategy m­ eeting, GroupManagement discusses and analyzies such risks. The Board of Directors is regularly informed in a uniform manner of the nature, scope,
assessment and counteractive measures of the risks.

3.2

Financial risk management

General information on the financial risk management of Interroll GroupThe Group’s activities expose it to a variety of financial risks: market risk (currency risk, interest rate risk and price risk), credit risk,
liquidity risk and cash flow risk. The Group’s risk management program focuses on the unpredictability of financial markets and seeks
to minimize potential adverse effects on Group’s ­financial performance.
The Board of Directors has supreme responsibility for risk management. The Board of Directors ­appoints thereto the Audit­Committee, who is responsible for the development and the supervision of the risk management principles. The Audit Committee
reports regularly to the Board of Directors.
The principles established for risk management are geared to identify and analyse those risks that may ­impact the Group, to definead­equate limits and to perform controls over the risks and adherence to them. The risk management principles and the related procedures are regularly verified in order to consider changing market conditions and operations of the Group. The target is to develop
management regulations and management processes and a disciplined and constructive control environment through existing ­training
and guidelines ensuring a disciplined and conscious handling of risks.
The Audit Committee supervises management in the control of compliance with principles and processes. Their adequacy is ­permanently verified with respect to the risks that the Group is exposed to. The Audit C­ ommittee is supported in this respect by the internal
audit department.
Financial risk management is carried out by the central treasury department. Group Treasury identifies, evaluates and reduces financial
risks in close cooperation with the Group’s operating units and reports at regular intervals to the Audit Committee.
The following sections provide a summary of the scope of individual risks and the targets, principles and processes implemented
for measuring, monitoring and hedging financial risks. Additional information on the financial risks is included in the notes to theconsolidated financial statements (see note “6.9 – Financial risks”).

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Market risk
Market risks to which Interroll Group is exposed to can be summarized into the following three main risk categories:a) Currency risk exposure
The Group operates internationally and is exposed to foreign exchange risks arising from various currencies. Foreign exchange risksarise from future commercial transactions and from recognized assets and liabilities. To manage its foreign exchange risk arisingfrom future commercial transactions and recognized assets and liabilities, the Group operates an internal monthly “netting” process. Net exposure ­resulting from assets and liabilities recognized is partially reduced using forward currency contracts. Suchcontracts are entered into only with high-credit-quality financial institutions. Furthermore, the decentralized structure of the Group
contributes to a substantial reduction of foreign currency exchange risks.
b) Interest rate risk
Financial assets and liabilities contain interest-bearing loans at either a fixed or a variable rate. Related interest risks are disclosed in 6.9.
c) Price risk
The Group is exposed to raw material price changes (steel, copper, technical polymers) as well as to price changes in financial liabilities and assets. Raw material price risks are not hedged, while risks from financial assets and liabilities may p­ artially or fully reduced
using derivative financial instruments (as described in 2.3 – Principles of ­consolidation and valuation, section “derivative financial
instruments”).
Credit risk
The risk of default is the risk to incur a financial loss when a customer or a counterparty to a financial instrument does not fulfill its legal
obligation. The default risk at Interroll exists on trade and other accounts receivable and on cash and cash equivalents.
Customers exceeding EUR 5,000 credit limit are verified for their creditworthiness before the order is ­executed. The creditworthinessverification is also based on the credit information database provided by an international service provider leading in this sector. Theirsoftware allows determination of a credit limit per single customer, based on specifically determined calculation formulas. The calculation formulas have been defined by Interroll Group.
Accumulation of credit risks in trade and other accounts receivable is limited due to numerous customers and their worldwide location.
The extent of credit risks is mainly determined by the individual characteristics of each single customer. The risk evaluation includes
an assessment of the creditworthiness by con­sidering the customer’s financial situation, its credit history and other factors. Sales andrevenue from services are performed only with customers whose creditworthiness is proved through the above process. A credit limit isdefined for each customer. These limits are verified at least once a year.
Interroll invests its funds in short-term deposits at a multitude of banks with whom long standing rela­tionships exist. Such deposits havea maturity date shorter than twelve months. Likewise, transactions with derivative financial instruments are entered into only with major
financial institutions. Interroll does not hold material open positions with these institutions.
The maximum credit risk from financial instruments corresponds to the balance sheet amount of each ­single financial asset. There areno guarantees or other liabilities that could increase the risk over the corresponding amount in the statement of financial position.
Liquidity risk
Liquidity risk is the risk that the Group cannot fulfill its financial obligations on time.
Prudent liquidity risk management implies maintaining sufficient cash and marketable securities, the a­ vailability of funding through anadequate amount of committed credit facilities and the ability to close market positions at any time. Due to the dynamic nature of theunderlying business, Group Treasury aims to ensure funding by keeping committed credit limits available.

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77

3.3

Capital risk management

Objectives and principles of capital management
It is the objective of Interroll Group to safeguard its going concern by the definition and adherence to a strong base of equity. Suchequity level is defined based on the operational and balance sheet risk of the Group. Refunding of the Group shall be adapted to the asset
structure and allow further growth of the b­ usiness. The distribution of a regular portion of the profits shall be made possible based on
the realization of an appropriate return on equity.
Equity ratio targets and pay-out ratio
Based on above targets and principles, Group Management aims at a long-term equity ratio of approximately 50 %. The ordinary pay-out
ratio corresponds to about 30 % of net profits. This ratio may deviate depending on the general economic outlook and planned future
investment activities.
Key figures to capital management
The following table discloses some essential key figures with regard to capital risk management. Further notes can be found in the coverof the annual report.
Debt Covenants
Determined debt covenants for comitted credit lines over CHF 40 million demand an equity ratio of at least 35 % (see 6.9 “Financial
risks – Credit facilities and debt covenants”)
in million CHF, if not noted differently

2015

2014

Total assets

293.0

278.2

Net financial assets

31.3

23.9

Gearing (net debts / equity)

n/a

n/a

Operating cash flow

40.2

27.8

Indebtedness factor (net debts / cash flow)

n/a

n/a

Equity

207.6

200.3

Equity ratio (equity in % of assets)

70.9

72.0

Result29.3

19.1

Return on equity (in %)

14.4

9.9

Non-Diluted Earnings per share (in CHF)

34.5

22.5

Distribution per share (in CHF)

12.0

9.0

Pay out ratio (in %)

34.8

40.1

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78

4

CHANGES IN THE SCOPE OF CONSOLIDATION

Changes in business year 2015
New companies
No new companies were started during the year under review.
Acquisitions / Divestitures
No acquisitions or disinvestments were made during the year under review.
Allocation of net assets acquired
The following overview shows a summary of the paid purchase price for the acquisition as well as the values of the identified assets and­lia­bilities as per acquisition date. For 2014, Pert Engineering Limited is shown.
in thousands CHF

2014
Fair value

Property, plant and equipment

82

Intangible assets

866

Deferred tax assets
Total non-current assets

948

Other receivables
Inventory
Trade receivables
Cash & cash equivalents

50
2,205
245

Total current assets

2,500

Total assets

3,448

Trade payables

1,116Bank loans

217

Other short term accounts payables

844

Accrued expenses & deferred income

30

Deferred tax liabilities

194

Provisions

45

Minority interests
Total liabilities

2,446

Total net assets acquired

1,002

Goodwill acquired

1,045

Total acquisition costs

2,047

Cash flow from acquisitions
The full amount settled in cash was for the acquisition of 100% of the shares of Pert Engineering Limited in 2014.
in thousands CHF

2014

Cash settlement of acquisition

2,047./. Acquired liquid funds from Portec–245./. Purchase price retention–372

Net cash used in acquisitions

1,430

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79

Changes in business year 2014
New companies
In Shanghai, the Interroll Holding Management (Shanghai) Co. Ltd. started its sales activities in China in August 2014. Besides two
Regional Centers of Excellence, Interroll is now also managing a sales unit in this important market. The effects of the establishment of
this new company had no material impact on the Interroll Group’s consolidated financial statements in the 2014 reporting year as theemployees, assets and business activities mainly were transferred from the existing Interroll Suzhou Co. Ltd.
Acquisitions
As per 28 February 2014 the activities of the Interroll Dynamic Storage Inc. in Hiram / Atlanta (USA) were sold for USD 1.1 million to
the local management. The company had achieved a turnover of CHF 1.7 million in fiscal year 2013. The result was not essential for the
consolidation of the Interroll Group.
As per 1 July 2014 a 40 % minority stake into Portec Asia Limited in Hong Kong, China was bought for USD 0.4 million from the Pert
Group. Interroll is now controling 100 % of the equity of this company. At the moment of the purchase the book value of the minority
participations of Portec Asia Limited amounted to CHF 0.3 million. This amount was booked out from the equity of the minority­participations and the difference to the purchase price in the amount of CHF 0.1 million was booked to the shareholders’ equity.
Furthermore, as per 1 September 2014 100 % of the shares of Pert Engineering Limited in Shenzhen, China were bought from the Pert
Group for USD 2.2 million. Thereby, Interroll took over its Asian partner for the production and the sales of belt curves in the Asia-­
Pacific region. Besides direct access to the important Chinese sales market Interroll also gained its own production plant for belt curvesin Shenzhen, China. Belt curves are primarily sold to customers from the airport, postal services and logistics sectors. The value of the
net assets acquired totalled CHF 1.0 million. Goodwill amounted to CHF 1.0 million. It is not expected that the goodwill will be deductiblefor income tax purposes. Intangible assets amounting to CHF 0.9 million consisted of customer relationships. The purchase price allocation was not final as of the reporting date of 31 December 2014. It is expected that Interroll’s presence in China and other Asian countries
is strengthened in particular, following these acquisitions. The goodwill amounting to CHF 1.0 million resulted from the ­customer baseand significant synergies expected from the integration of the Pert companies into the Interroll Group.
Further notes to the acquisition of Pert Engineering Limited
Acquisition-related expenses of CHF 0.1 million were stated under consultancy expenses in the profit and loss account for financial
year 2014.
The fair value of trade receivables amounted to CHF 2.2 million. The gross amount of trade receivables due totalled CHF 2.3 million.
Of this amount, it is expected that CHF 0.1 million will be irrecoverable.
Since 1 September 2014, Pert Engineering has made a contribution totalling CHF 0.8 million to Interroll Group’s sales revenue. Its sharein the profit for the same period of time amounted to CHF 0.09 million.
Had Pert Engineering already been consolidated from 1 January 2014, sales revenue of CHF 339.4 million and a profit of CHF 19.3 million would have been reported in Interroll Group’s profit and loss account.

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5

OPERATING SEGMENTS

Sales and non-current assets by geographical markets
Sales and non-current assets according to geographical market is presented as follows:
Sales

2015

in %

Germany

49,938Rest of EMEA

164,334

Total EMEA*

in thousands CHF

USA

Non-current assets

2014

in %

2015

in %

2014

in %

13.8

55,86816.7

55,48741.6

52,21938.4

45.6

154,379

46.0

43,411

32.5

48,941

36.1

214,27259.4

210,247

62.7

98,89874.1

101,160

74.5

80,99822.5

63,40018.9

28,803

21.6

28,545

21.0

Other Americas

16,646

4.6

18,485

5.5

1,177

0.9

1,526

1.1

Total Americas

97,64427.1

81,88524.4

29,98022.5

30,071

22.1

Total Asia-Pacific

48,822

13.5

43,174

12.9

4,656

3.5

4,612

3.4

Total Group

360,738100.0

335,306

100.0

133,534

100.0

135,843

100.0* Europe, Middle East, Africa

The key definition of turnover has been defined according to the invoice address. Non-current assets are disclosed excluding financial
assets and deferred tax assets.
Information about major customers
Sales are realized with more than 10,000 customers. There is no customer achieving a turnover of more than 4 % percent of Group sales.
Sales by product group
Sales realized by product group is presented as follow:
in thousands CHF

2015

in %

2014

in %

2013

in %

Drives110,27630.6

114,905

34.3

109,447

34.6

Rollers

93,36925.981,20924.2

75,40623.8

Conveyors & Sorters

107,23929.7

79,77323.8

71,16422.5

Pallet & Carton Flow

49,85413.8

59,41917.7

60,31719.1

360,738100.0

335,306

100.0

316,334

100.0

Total Group

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6	NOTES ON THE CONSOLIDATED STATEMENT OF FINANCIAL POSITION
6.1

Property, plant and equipment

Movements of property, plant and equipment
Land& building

Production equipment& machinery

Office equipment& motor vehicles

Assets underconstruction

Total

2015

2014

2015

2014

2015

2014

2015

2014

2015

2014

At 1.1.

86,54485,62094,857

91,734

9,044

8,804

4,463

1,281

194,908

187,439in thousands CHF

COSTS
Currency translation adj.

–5,824726–5,589

660

–644

87

–392

46

–12,449

1,519

Additions

2,330

791

8,222

7,015

980

1,290

9,647

4,654

21,17913,749

Disposals–1,885–588–3,305–3,605–1,215–890–11–6,416–5,083

Reclassifications

11,625–5

1,168–1,02643–251–12,613–1,518223–2,80092,79086,54495,353

94,857

8,208

9,044

1,094

4,463

197,445

194,907–104,173

Changes in the scopeof consolidation*
At 31.12.

79

83

4

ACCUMULATED DEPRECIATION & IMPAIRMENTS–32,666–29,442–70,038–68,981–6,235–5,750–108,939

Currency translation adj.

At 1.1.

2,377

–144

3,905

–507

435

–60

6,717

–711

Depreciation–3,131–3,208–6,387–6,509–1,079–1,202–10,597–10,919

Disposals

1,644

124

3,095

3,249

1,037

743

5,776

4,116

4

–24

2,710

–4

34

–28

2,748

–31,776–32,666–69,449–70,038–5,846–6,235–107,071–108,939

61,01453,87825,904

24,819

2,362

2,809

90,37485,969

9,670

745

2,584

1

104,834

101,423

113,646

115,407

Reclassifications
At 31.12.
Property, plant and­equipment at 31.12.
Capital commitments
Insurance value**

1,094

4,463

746

12,254

218,480

216,830* Detailed information on the changes in the scope of consolidastion is disclosed in note 4.
** The insurance value of production equipment and machinery also covers other tangible assets.

Further notes to property, plant and equipment
At the end of the period under review no risks exist in the opinon of Group Management which negatively impacted the book value of
fixed assets.

6.2 Non-current assets held for saleIn the year under review 2015 as well as in the previous year 2014 there were no non-current assets held for sale.

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82

6.3

Intangible assets

Movements of goodwill and intangible assets
Goodwillin thousands CHF

SoftwarePatents, technology
and licences

Total

Customer relationship

2015

2014

2015

2014

2015

2014

2015

2014

2015

2014

20,73319,09133,07431,50820,42721,51425,96025,113

100,194

97,226

–828

731

–172

13

–1,956–363–1,968229–4,924

611

42

3,044

1,585

91

2

16

3,135

1,645

–176

–429

–73

–593

–110

–525

–952

41

–133

–154

COSTS
At 1.1.
Currency translation adj.
Additions
Disposals–96

Reclassifications–246

Changes in the scopeof consolidation*
At 31.12.

1,045
19,80920,733

1,911

866
35,51733,074

18,562

20,42723,99225,96097,880100,195–14,000–10,288–14,673–14,310–18,521–16,448–50,320–44,172

126

–19

1,367

227

1,665

199

3,158

406

–1,152–1,316–2,425–2,536–7,830–7,805272

952

ACCUMULATED AMORTIZATION & IMPAIRMENTS
At 1.1.

–3,126–3,126

Currency translation adj.
Amortization–176–4,253–3,777

Disposals

176

272

73

593

110

11

133

154

Reclassifications
At 31.12.

298–3,126–3,126–17,855–14,000–14,458–14,673–19,281–18,521–54,720–50,321

16,683

17,607

17,662

19,074

4,104

5,754

4,711

7,439

43,16049,874

Total intangible assets, net
at 31.12.

* Detailed information on the changes in scope of consolidastion is disclosed in Note 4.

Goodwill: impairment test
The impairment tests are generally based on a three-year plan and on the present value of future (pre-tax) cash flows (value in use)
determined using a discount rate before tax of 11.3 % (2014: 10.6 %). The growth rate is defined as a key assumption. No further growth
was assumed for the extrapolation of free cash flows. The Cash Generating Unit (CGU) equals the Interroll Group. There is only one
Operating Segment which equals the Reporting Segment. All decisions are made at Interroll Group level.
Sensitivity analysis to the goodwill impairment tests
The sensitivity analysis performed resulted in both years under review to the conclusion that the discounted value of future free cash
flows exceeds the value of the current goodwill even when assuming a change of the discount rate under normal economical conditions.
The growth rate was reviewed in regards to its sensitivity. This test led to the conclusion that the discounted value of future cash flows
exceeds the value of the current goodwill position even if no growth is assumed.

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83

Software
Out of the accumulated acquisition costs, CHF 29.9 million (previous year: CHF 28.7 million) relate to the setup, design and introduction of SAP. In the year under review the additions to this process management system amount to CHF 1.2 million (previous year:
CHF 1.6 million). Amortization starts with the go live date and ends after 8 years.
SAP was launched in 2011 for the two Centers of Excellence for Drum Motors and Rollers / RollerDrive as well as for all European sales
and service subsidiaries. In 2012, SAP was also launched in the Center of Excellence for Supermarket Products, in the Regional Centerof Excellence for Rollers and Drum Motors in the USA as well as in several sales subsidiaries in Asia-Pacific. In 2013, SAP became activewith Interroll China. Finally, SAP went live with the Center of Excellence for Automation in Sinsheim as per 1 August 2014. During theyear 2015 SAP projects in North America and France were ongoing.
Patents and licenses
Patents and licenses are normally amortized on a straight line basis over 6 years unless the life cycle is shorter. In the year under review
and in the previous year no essential patents oder licenses were bought. As per the end of 2015 an amortization term of additional 4 years
remains on the major portion of patents and licenses. A review whether indicators exist that point towards an impairment of patents andlicenses was performed. There are no signs that would indicate an impairment of this value.
Customer relationship
Customer relationship is amortized on a straight line basis over 10 years unless the life cycle is shorter. At year end 2015, an amortization
term of an additional seven years remains on the major portion of customer relationship. A review whether indicators exist that point
towards an impairment of customer relationship was performed. There are no signs that would indicate an impairment of this value.

6.4

Assets pledged or assignedin thousands CHF

31.12.2015

Land & buildings

31.12.2014
1,289

Trade receivables

201

185

Total assets pledged or assigned

201

1,474

These assets are pledged or assigned to local credit lines granted (see liquidity risk in note 6.9).

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84

6.5

Inventories

Detailed overview on the positions belonging to the inventory
in thousands CHF

31.12.2015

31.12.2014

Raw materials

31,25832,033Work in progress

11,341

10,168Finished products

4,388

2,285

Valuation allowance–2,154–2,213

Total inventory, net

44,83342,2732015

2014–2,213–1,901

No inventory was pledged in either year under review.

Developement of valuation allowance on inventory
in thousands CHF

Balance as per 1.1.
Currency translation adjustment

219

–27

Additions

–566

–665

Reductions
Total valuation allowance on inventory as per 31.12.

406

380

–2,154–2,213

The addition of valuation allowances is due to slow or non-moving items within the inventory. The reduction of valuation a­ llowanceon inventory is related to sale or scrapping of items, as well as to a reassessment of the valuation allowance affecting the consolidated
income statement of the Group.

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6.6

Trade and other accounts receivable

Detailed overview of trade and other accounts receivable
Trade accounts receivable arise from deliveries and services relating to the Group’s operating activities. VAT, whithholding tax and othercurrent receivables are included in the other accounts receivable. The other accounts receivable are analyzed for valuation adjustment
like trade receivables. There was no valuation adjustment necessary on other accounts receivable in either year under review.
in thousands CHF

31.12.2015

31.12.2014

62,256

62,242

Trade accounts receivable from goods and services
Valuation allowance–2,784–2,783

Total trade accounts receivable, net

59,47259,459Prepaid expenses and accrued income

5,934

1,623

Prepayments for inventories

1,594

1,677

Other accounts receivable

10,471

7,584

Forward exchange dealing

–482

85

Total other accounts receivable

17,517

10,969Total trade and other accounts receivable, net

76,98970,428Aging and valuation allowance of trade accounts receivable
Trade accounts receivable are due and specific / general valuation allowance have been evaluated as follows:
31.12.2015

in thousands CHF
GrossValuation allowance
individual

Not past due

41,831

Past due 1– 30 days

9,573

Past due 31– 60 days

4,061

Past due 61– 90 days

2,415

–10

Past due > 90 days

4,376

–2,07562,256–2,340Net

31.12.2014
Grosscollective

Valuation allowance
individualNet

collective

41,576

41,56041,5609,573

11,683

11,683

4,061

3,412

2,405

2,418

7

–444

1,857

3,169

–2,297

–493

379

–444

59,472

62,242–2,290–493

59,459

–255

3,412
2,425

Total trade accounts
receivable

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86

Development of the individual and collective valuation allowance of trade accounts receivable
The valuation allowance on trade accounts receivable from third parties developed as follows:
2015

2014

Valuation allowance

Valuation allowancein thousands CHF
Total

individualcollective

Total

individualcollective–2,783–2,290–493–2,873–1,891

–982

230

181

49

–32

–52

20

–1,078–1,078–868–868

Alllowance used

381

381

422

422

Allowance reversed

466

466

568

99

469

–2,784–2,340–2,783–2,290–493

At 1.1.
Currency translation adjustment
Additions

At 31.12.

–444

During the year under review, an amount of CHF 0.4 million (2014: CHF 0.4 million) relating to irrecoverable trade receivables
was ­written off. Currently, no other risks are identifiable in the net trade accounts receivable. Sales are broadly diversified across geographical and industrial markets. Thus, the risk of unexpected losses from trade receivables is assessed to be low.

Currencies in trade accounts receivable
Trade accounts receivable reported in CHF are denominated from the following currencies:
31.12.2015

in %31.12.2014

in %

EUR

25,32540.7

25,928

41.7

USD

13,11921.1

14,67523.6

CNY

11,44918.4

10,169

16.3

THB

1,272

2.0

1,528

2.5

DKK

1,774

2.8

1,452

2.3

all other currencies

9,317

15.0

8,490

13.6

Total trade accounts receivable, gross

62,256100.0

62,242100.0

31.12.2015

in %31.12.2014

in %Europe, Middle East, Africa

30,97049.7

31,11050.0Americas14,05922.6

16,761

26.9

Asia-Pacific

17,22727.7

14,371

23.1

Total trade accounts receivable, gross

62,256100.0

62,242100.0

in thousands CHF

Regional break down of trade accounts receivable
Trade accounts receivable can be broken down into the following geographical areas:in thousands CHF

On average, trade accounts receivable are 56 days outstanding (DSO). The respective value is for Europe 47, for Americas 62 and for Asia 84.
In the previous year, the DSO was 57 for the Group, for Europe 49, for Americas 68 and for Asia 81.

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6.7

Cash and cash equivalents

Positions included in cash and cash equivalents
31.12.2015

31.12.2014

Cash on hand, bank and postal accounts

30,28921,147

Short term deposits

1,365

3,233

Total cash and cash equivalents

31,654

24,380in thousands CHF

Interest rates of cash and cash equivalents
The interest rates on cash and cash equivalents vary between 0 % (for CHF) and 16 % (BRL). The respective rates for 2014 were 0 %(CHF) and 11 % (BRL) respectively.

Currencies held in cash and cash equivalents
in %31.12.2015

31.12.2014

EUR

29.0

27.0

CHF

8.0

7.0

USD

21.0

15.0

THB

6.0

7.0

JPY

3.0

6.0

KRW

10.0

5.0

ZAR

1.0

3.0

Other currencies

22.0

30.0

Total cash and cash equivalents

100.0

100.0

Transfer limitations on cash and cash equivalents
Cash and cash equivalents of CHF 0.6 million (2014: CHF 0.8 million) of Interroll South Africa as well as of Interroll Brasil are s­ ubject
to transfer limitations. These transfer limitations do not have any impact on their operating activities.

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88

6.8

Financial instruments

Reconciliation from balance sheet items to valuation categories as per IAS 39
The table below shows an overview of financial instruments held by valuation category according to IAS 39:
31.12.2015

31.12.2014

Cash and cash equivalents

31,654

24,380Trade and other accounts receivable w / o advances

75,877

68,666626

626

108,157

93,672in thousands CHF

Financial assets
Total financial assets at amortized costs
Foreign currency forward contracts*

–482

85

Total financial instruments at fair value

–482

85

Trade and other accounts payable

39,76739,611

304

470

40,071

40,081

Financial liabilities
Total financial liabilities
at carrying value* see notes 6.9

Book values of cash and cash equivalents, trade and other accounts receivable and payable as well as financial assets closely correspondto fair value due to their short-term maturity. Advance payments for inventory are excluded from the valuation categories as per IAS 39
because the subsequent transaction is not of a monetary nature. Financial assets and liabilities are predominantly due within approximately 2 years and their net present values correspond very closely to their book values.

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89

6.9

Financial risks

Currency risk exposure
Due to its international focus, Interroll Group is exposed to foreign currency risks. Risk exposures result from transactions incurrencies deviating from the entity’s functional currency.
The following table shows the major currency risks at the respective balance sheet date:
31.12.2015

in thousands CHF

Financial assets

EUR

CHF

USD

SGD

3

75

5,227

1,030

5,342

1,870

2,495

11,747

2,751

1,476

JPY

31.12.2014
EUR

CHF

USD

SGD

70

12

2,983

6,624

558

5,599

1,978

2,520

11,719

1,443

1,573

4,038

JPY

Trade and otheraccounts receivable

2,730

1,454

Cash and cash equivalentsincl. intercompany loans
Financial liabilities

4,998

6,633

Trade and otheraccounts payable
Short term liabilities

9,330

5,711

2,744

314

28,361

158

1,267

3

7,737

3,417

2,652

569

6,994

118

1,353

17,45022,75816,457

7,887–9,534–17,798–6,141

–7

7,916

4,960

10,316

7,880

–996

–1,117

Currency risks on
the balance sheet (gross)

17,36946,924

15,993Elimination equal currency–8,389–25,704–6,373

8,980

21,220

9,620

8,651

2,733

1,454

Currency risks on ­the balance sheet (net)Natural hedges

8,651

2,733

–311

–260

–478

–60

FX forward contracts–1,423–13,862–6,042–4,214–743–848

Net currency risk exposure

7,246

7,098

3,100

4,377

1,990

6,072

3,843

1,454

–279

–84

–3,915–3,779

–750

6,122

4,017

704

The currency risk on the balance sheet (gross) is equal to the sum of the value of all positions in the balance sheet that are held in adifferent currency than the functional currency of a company. Such positions contain both group-internal as well as external amounts.
In a first step, all of those risks are added up because a currency risk can arise on the debit as well as on the credit side of the balance
sheet. The total is then disclosed as currency risk on the balance sheet (gross). The risk of each currency group is translated into CHF
at the closing rate and added up to total Group values. “Elimination equal currency” results from setting off short positions versus longpositions of currrency risks which exist in the same foreign currency deviating from the functional currency and which are presented
in the same group entity. Natural hedges result from netting out currency risks among all group entities. The amount disclosed in line
“FX forward contracts” (foreign currency forward contracts) corresponds to the amount actually ­hedged and translated into CHF.
Changes in the valuation of fair value hedges are recognized in the financing result (see note 7.5). The table only contains the material
foreign currency risks. All others are regarded to be immaterial in both years.
Net investments in foreign subsidiaries are long term investments. Such investments are exposed to currency fluctuation, because they
are held in another currency than the Group’s functional currency. From a macroeconomic and long term point of view, the currency
exchange effects should be neutralized by the inflation rate at the subsidiaries’ domicile. Due to this reason and also due to costs forrespective derivative instruments, the Group does not hedge such risks.

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90

Foreign currency forward contracts
The Group regularly prepares a rolling forecast of foreign currency cash flows. 0–50 % of such budgeted, future foreign currency flows
may be hedged through forward contracts. At the end of the year under review, there were no open cash flow hedges held by the Group.
The notional amount corresponds to the hedged balance sheet risk, translated into CHF. With derivative financial instruments, theGroup normally hedges 50–100 % of its net currency risks on the balance sheet.
The following table shows the contractual and fair values of the foreign currency forward contracts held by the Group:
31.12.2015

in thousands CHF

31.12.2014

Sell / Buy

Maturity

notional
amount in CHF

Fair value

Sell / Buynotional
amount in CHF

Fair value

USD

USD / CAD

Feb 16980–63

USD / CAD

839

–25

USD

USD / CHF

Feb 16

632

–30

USD

EUR / USD

Feb 16

1,764

73

EUR / USD

2,488

147

CNY / USD

588

–1

834

–15

Hedgedcurrency

USD
SGD / EUR

Feb 16879–19

SGD / EUR
JPY / SGD

694

51

SGD

SGD / CHF

Feb 162,717–76

SGD / CHF

2,251

–32

EUR

USD / EUR

Jan – Dec 16

2,665

–87
CHF / EUR

848

–3

BRL / EUR

Feb 16631–33
JPY / EUR

750

47

JPY

JPY / EUR

Feb 16

743

–25

JPY

JPY / SGD

617

–9
CNY / EUR

1,482

–84

1,433

–26

SGD
SGD

EUR
EUR
JPY

CNY
CNY / EUR

Feb 16CNY

CNY / CHF

Feb 16

905

–24

CHF

EUR / CHF

Feb 16

12,957–91

GBP

GBP / EUR

Feb 16

1,888

8

CZK

EUR / CZKFeb 16325

BRL

USD / BRL

Jan – Sep 16

468

CNY

–80

Total FX forward­contracts

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85

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91

Sensitivity analysis of the currency risk exposure
As per year end, a sensitivity analysis was carried out with respect to financial instruments. The sensitivity analyses calculates the effectof FOREX–changes on the major currency pairs within the Group. These risks particularly result from different currencies b­ etween costs
for production and invoicing currency to the customers. Assumed currency fluctuations would have the following effects on the foreign
currency positions in the balance sheet:
31.12.2015

in thousands CHF
Currency pairFinancial assets

EUR
vs. CHF

Cash and cash equiv. incl. IC-loans

CHF
vs. USDCAD
vs. USDEUR
vs. CHF

525

1,673

2

752

75

Trade and other receivables
11,511

31.12.2014
CHF
vs. USDCAD
vs. USD

–267

847

2,600

10,7391

860

70

Financial liabilities
Trade and other payables

1,901

Short term and current liabilities

28,362

606

779
6,995

Gross exposure per currency pair

41,849527

3,031

17,537

848

4,239

Risks opposing each other–22,335573–1,213–15,399308–1,559FX forward contracts–12,957

–632

–980

–848

6,557

468

838

1,290

1,156

1,841

Net FX exposure per currency pair

–839

Currency change in %

12

5

14

1

1

7

Effect on the result

787

23

117

13

12

129

Income tax expense at 20.73 %

–163

–5

–24

–3

–2

–27

Net FX exposure after income taxes

624

18

93

10

10

102

The net risks of currency pairs are summed up analogously to the current risk analysis. The position “Risks opposing each other” is a
result of netting out those risks that are contrary to each other. The disclosed amount in line “FX forward contracts” equals the total ofhedged currency risks of a currency pair. It is also deducted from the gross risk as it deviates linearly with the fluctuation of the currency.
The income taxes are calculated in line with the applicable rate for an ordinary taxed entity in Switzerland (see note 7.6).

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92

Interest risks
As per balance sheet date, the Group had net financial assets of CHF 1.7 million (previous year: CHF 3.3 million, see a­ lso note 6.12).
There are CHF 1.9 million (previous year: CHF 3.7 million) financial assets, of which CHF 0.7 million (previous year: CHF 0.5 million)
are not interest-bearing. There are financial liabilities of CHF 0.2 million (previous year: CHF 0.3 million). The portion of not interest-­
bearing financial liabilities was immaterial in both years under review.
The following table divides interest-bearing assets and liabilities into fixed and variable parts. Furthermore, it shows not interest-bearing
positions within financial assets and liabilities. A change of the interest rate would have had no effect on equity because the Group­currently does not hold any cash flow hedges to hedge currency risks and because there are no assets held for sale at a fixed interest rate.
The Group ­regularly monitors its interest risks and reserves the possibility to hedge such in future.
31.12.2015

in thousands CHF
Nom. int. rate in % Book values

Basis points
+ 100

– 100

11

–11

31.12.2014
Nom. int. rate in % Book values
00Basis points
+ 100

– 100

24

–24

24

–24

24

–24

FINANCIAL ASSETS
Fixed interest rate0 – 0.73

195

Variable interest rate0 – 5.75

1,055

Not interest-bearing–

690

Total deposits

1,940

11

0 – 2.63754

0 – 10.3

2,410

–

502

–11

3,666

Total loans
Cash on hand, bank and postal accounts

30,289Trade and other receivables

76,35921,147
68,581

Total other financial assets

106,648

89,728

Total financial assets

108,58811–11

93,394

FINANCIAL LIABILITIES
Total bank loans
Fixed interest rate

3.6

6.0 – 9.85

8153

Not interest-bearing

183

188

Total other loans

191

341

Bank overdrafts

1

1

0

Trade and other accounts payable

39,76739,611

Total trade and other accounts payable

39,76839,612

Total financial liabilities

39,95939,9530

Net financial liabilities

68,62953,441

24

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11

–11

–24

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93

Sensitivity analysis of interest risks
Interest sensitivity is only calculated on interest-bearing items of the balance sheet. No effect is calculated on items bearing interest at ­afixed rate. As per above analysis, the Group’s annual result would have changed slightly by CHF 0.01 million in case of an interest rate
being one percentage point higher or lower. In the previous year, an increase in the interest rate of one percentage point, would havechanged the Group’s result slightly by CHF 0.02 million. For certain interest-bearing positions, the interest rate is already ­lower than one
percent. Therefore, the effect of the reduction was only calculated up to the current interest rate being lower than 1.0 %.
Liquidity risk
The Group carries out a complete liquidity planning on a quarterly basis. The Group holds liquidity reserves in the form of committed
and uncommitted credit lines in order to comply with an unexpected and extraordinary liquidity demand.
Credit facilities and debt covenants
The amount of unused credit facilities as per end of the reporting year amounted to CHF 78.5 million (­ 2014: CHF 78.4 million).
In the year under review, the committed credit lines in the amount of CHF 40.0 million which were agreed upon in 2009 were extended
with the same conditions for another duration of 3 years. They ensure the ­funding of the future investment program and serve ­generally
for the for business financing. The Group ­always complied with the agreed debt covenants, which are the following:
EBITDANet debt
Equitynet interest costs = min. 4.0
EBITDA = max. 3.0
total assets = min. 35 %The ageing of the financial liabilities is disclosed in note 6.12 (see “Ageing of financial liabilities”).

6.10

Information on shareholders’ equity

Reconciliation from total issued shares to outstanding shares
2015

2014

854,000

854,000

Own shares held by the Group as per 1.1.

4,170

3,849

Purchase of own shares

1,360

2,090

Sale of own shares–502

Issued shares par value CHF 10.00 each (previous year: CHF 10.00)

Attribution of shares relating to bonus plan

–2,043–1,769Own shares held by the Group as per 31.12.

2,985

4,170

thereof unreserved

2,985

4,170

851,015

849,830

Shares outstanding at 31.12.

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94

6.11 Earnings per shareNon-diluted earnings per share
The non-diluted earnings per share in 2015 amount to CHF 34.51 (2014: CHF 22.45). The calculation is based on the profit a­ ttributable
to the equity holders of the parent company, divided by the weighted average of shares outstanding. In 2014 there is no diluting effect.
2015

2014

Result attributable to the equity holders (in thousands CHF)

29,30319,068

Shares outstanding as per of 1.1.

849,830

850,151

Effect of the purchase of own shares

–63

–294

Effect of the sale / attribution of own shares

–612

–687

Weighted average of shares outstanding

849,155

849,170

Non-diluted earnings per share (in CHF)

34.51

22.45

Diluted earnings per share
The diluted earnings per share in 2015 amount to CHF 34.51 (2014: CHF 22.45). They are calculated by adjusting the weighted average
number of ordinary shares outstanding to include all dilutive potential ordinary shares.
There were no dilutive effects in 2015 or 2014.
2015

2014

Result attributable to the equity holders (in thousands CHF)

29,30319,068Weighted average of shares outstanding

849,155

849,170

849,155

849,170

34.51

22.45

31.12.2015

31.12.2014

Dilutive effect of share options
Weighted average of shares outstanding (diluted)
Diluted earnings per share (in CHF)

6.12 Financial liabilities
Details of current and non-current financial liabilities
in thousands CHF

Bank overdrafts
Other loans

1

1

182

188

Finance lease

113

128

Total current financial liabilities

296

317

Other loans

8153

Total non-current financial liabilities

8

153

304

470

Total financial liabilities

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Net financial liabilities to equity ratio
31.12.2015

in thousands CHF

Total financial liabilities

31.12.2014

304

470

. /. Cash and cash equivalents–31,654–24,380

Net financial liabilities (-net cash)–31,350–23,910Equity207,647

200,330n/a

n/a

Net financial debt in % of the equity

Loan structure
31.12.2015

in thousands CHF
Currency

Other loans

USD / DKK

Weighted av.
Interest dueinterest rate Fixed / Variable0  – 3.6 %FYear ofmaturity

Face
value

2017

Total loans

31.12.2014

Carrying
amountFace
value

Carrying
amount

190

190

341

341

190

190

341

341

Ageing of financial liabilities
The financial liabilities as per 31 December 2015 are due as follows:in thousands CHF

Other loans
Bank overdrafts

Book value

Face value(undiscounted)

190

190

1

1

within6 months

within6 –12 months

within
1– 2 years

182

8

182

8

within2 – 5 years

1

Trade / other accounts payable*

39,767

41,97041,970Total financial liabilities

39,95842,161

41,971* An ageing analysis is not readily available. Based on past experience, it can be reliably assumed that the full amount is due within less than 6 months.

The financial liabilities as per 31 December 2014 were due as follows:in thousands CHF

Other loans
Bank overdrafts

Book value

Face value(undiscounted)

341

341

1

1

within6 months

within6 –12 months

within
1– 2 years

188

153

188

153

within2 – 5 years

1

Trade / other accounts payable*

39,61137,53037,530Total financial liabilities

39,95337,87237,531* An ageing analysis is not readily available. Based on past experience, it can be reliably assumed that the full amount is due within less than 6 months.

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96

6.13 Leasing liabilities
Finance leases
In the year under review, there were CHF 0.1 million in finance leases (2014: CHF 0.3 million) of which CHF 0.1 million (2014:
CHF 0.1 ­million) will become due in one to five years.
Operating leases
Liabilities from operating leases mainly relate to building rentals and will become due as follows:
31.12.2015

in thousands CHF

31.12.2014

within 1 year

2,149

2,175

between 1 and 5 years

4,154

5,650

over 5 years
Total operating leases

618

1,319

6,921

9,144

In both years under review, operating lease expenses do not include material amounts for contingent rent.

6.14 Provisions
Movements in provisions
Warranties

Total

Other provisions

in thousands CHF

2015

2014

2015

2014

2015

2014

At 1.1.

5,955

5,868

45

34

6,000

5,902

Currency translation adjustments

–450

132

–4

Provisions made

3,013

2,913

30

Provisions used

–1,595–1,987

Provisions reversed–1,092–1,016

Acquired provisions
At 31.12.

11

–9

–454

132

3,043

2,924

–1,595–1,987–1,101–1,016

5,893

6,000

45

45
5,831

5,955

62

45

Warranty provisions
The Group companies normally grant a 24-month warranty. The warranty provision is recognized based on past experience as well as
on specific projects. The warranty provision in 2015 corresponds to roughly 1.6 % ­(2014: 1.8 %) of net sales.
Other provisions
The other provisions mainly include provision for litigation. In connection with the restatement related to IAS 19 pension liabilities werereclassified from other provisions to a separate balance sheet line.

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6.15 Pension obligations and pension costs
General information on the pension plans of the GroupThe pension costs for 2015 amounted to CHF 1.8 million (2014: CHF 2.3 million). Such costs consist of ­employer contributions relating
to the defined contribution plans and pension costs relating to the defined benefit plans.
The pension plans in Switzerland and France are regarded as defined benefits plans in line with IAS 19. In 2015, 216 and in 2014,
201 employees participated in the defined benefit plans. The Swiss plan is outsourced to a collective foundation whereas the plan inFrance is outsourced to an insurance company. For the defined benefit plans the pension costs in each period are calculated on the basisof an actuarial valuation. The deficit or excess of the fair value of plan assets over the present value of the defined benefit obligation is­recognized as a liability or an asset in the balance sheet. Actuarial gains and losses arise mainly from changes in actuarial assumptions anddiffereneces between actuarial assumptions and actual developments. They are recognized in the statement of comprehensive income.
It can be assumed that the assets of both plans do not include Interroll shares.
Components of defined benefit costin thousands CHF

2015

2014

Costs of the defined contribution plans

1,389

1,525

Current service costs, net

253

446

Administrative expenses

54

54Interest costs

70

59

Costs of the defined benefit plans

377

559

Effects of changes in financial assumptions

523

3,012

Effects of experience assumptions

137

–7

(Return) on plan assets (excl. interest income)180

4

Remeasurements included in other income

840

3,009

2,606

5,093

Effects of changes in demographic assumptions

Defined benefit costs

The expected contributions of the employer will not change materially in future years provided the number of insured employees
remains stable.

Amounts recognized in the statement of financial position
2015

2014

Present value of defined benefit obligation–22,477–19,907

Fair value of plan assets

16,15314,141

Pension liability–6,324–5,766in thousands CHF, as per 31.12.

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98

Roll forward of the defined benefit obligationin thousands CHF

Benefit obligation as per 1.1.

2015

2014

–19,907–15,787

Current service costs, net

–253

–500

Interest costs

–264

–366

Contributions from employees

–409

–394

Benefits paid / (funded), net–1,061124

Benefits paid / (funded), net from employer

1

11

Translation difference7610– Effects of changes in financial assumptions–523–3,012– Effects of experience assumptions

–137

7

–22,477–19,907

2015

2014

Remeasurements

Benefit obligation as per 31.12.

Roll forward of the present value of plan assets
in thousands CHF

Fair value of plan assets as per 1.1.

14,141

12,962Administrative expenses

–54

–54

Interest income

194

361

Employer contributions

591

606

Employee contributions

409

394

1,061

–124

Benefits (paid) / funded, net
Translation difference–90Income of plan assets

–180

–4

16,15314,141

2015

2014

16,15314,141

Fair value of plan assets as per 31.12.

Investment categories
in %Qualified insurance policies* These assets are fully invested by the collective foundation of AXA in qualified insurance policies within AXA

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 NOTES ON THE CONSOLIDATED STATEMENT OF FINANCIAL POSITION99

Net defined benefit liability (asset) reconciliationin thousands CHF

Net defined benefit liability (asset) as per 1.1.

2015

2014

–5,766–2,824

Defined benefit costs included in P / L

–377

–559

Total remeasurements included in OCI–840–3,009

Employer contributions

591

606

Translation difference

68

20–6,324–5,7662015

2014

Discount rate

1.0

1.3

Future salary increases

1.5

1.5

Expected benefit increases

0.0

1.8

Fluctuation rate

10.0

10.0

BVG 2010

BVG 2010

Net defined benefit liability (asset) as per 31.12.

Actuarial assumptionsin %Mortality probabilities

Sensitivities
Discount rate and future salary increases are considered as essential actuarial assumptions. The following effects are expected:
Discount rate

1.03 %+0.25 %

–0.25 %

Benefit obligation–22,477–21,398–23,478

Rate of salary increase

1.50 %+0.25 %

–0.25 %

Benefit obligation–22,477–22,601–22,347

Sensitivities are based on likely possible changes as per end of 2015.

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100

6.16 Trade and other accounts payable
31.12.2015

31.12.2014

Trade accounts payable to third parties

10,896

13,446

Advances received from customers

14,52914,746

Total trade accounts payable

25,42528,192in thousands CHF

Other liabilities

14,342

11,419Total other accounts payable

14,342

11,419Accrued personnel expenses

8,835

8,272

Accrued interest

3

3

Other accrued expenses

7,894

4,390

Total accrued expenses

16,732

12,665

Total trade and other accounts payable

56,49952,276

Advances received from customers mainly relate to larger projects within the product groups Conveyors & Sorters and Pallet &­Carton Flow. Other liabilities include VAT and social security related liabilities. Accrued personnel expenses relate to accrued vacation
and bonuses.

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NOTES ON THE CONSOLIDATED INCOME STATEMENT

101

7

NOTES ON THE CONSOLIDATED INCOME STATEMENT

7.1

Personnel expenses

Details on personnel expenses and number of employees
2015

2014

Wages and salaries

87,57584,420Social security costs

13,56013,074

Pension costs (see note 6.15)

1,766

2,084

Other personnel-related costs

1,226

3,004

in thousands CHF

Equity-based personnel expenses to management personnel

972

925

105,099

103,507

Thereof production-related personnel expenses

47,92346,504

Average number of employees

1,820

1,675

Total personnel expenses

In the period under review 2,043 own shares (2013: 1,769) were attributed to management members as part of their bonus scheme. In
the year under review 2,043 shares (2014: 1,769) have been blocked from sale for a period of four to eight years as of grant date. The
shares were valuated at the market value of the attribution date.
7.2 Research and development expenditures
These expenses are mostly incurred to further develop and complete the product range of the segments. They are included in p
­ ersonnel
and other operational expenses as well as in depreciation on fixed tangible assets. No expenses have been capitalized as the preconditions
stated in IAS 38 are not met cumulatively.
The Group incurred the following expenses for research and development during the years under review:in thousands CHF

2015

2014

Research and development (R&D) expenditures

8,465

8,694

R&D in % of net sales

2.35

2.59

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NOTES ON THE CONSOLIDATED INCOME STATEMENT

102

7.3

Other operating expenses

in thousands CHF

2015

2014

Production-related expenses

9,302

9,079

Freight

9,132

8,644

Office, administration and IT services

6,196

6,277

Building costs

4,937

4,932

Traveling and transportation

5,809

5,707

Marketing

3,786

4,673

Consultancy, auditing and insurances

3,778

6,249

Provisions and allowances, net

2,790

1,743

Variable sales costs

2,618

2,599

Non-income taxes

2,065

1,737

Other expenses and services

3,644

3,472

Total other operating expenses

54,057

55,112in thousands CHF

2015

2014

Scrap income and miscellaneous receipts

7.4

Other operating income

1,603

8,715

Income from services

263

252

Government grants received

14

14

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

453

197

Realized effects on cash flow hedges
Total other operating income

7.5

25
2,358

9,178

2015

2014

Financial resultin thousands CHF

Fair value changes of foreign currency forward contracts

567

–74

Realized translation loss

236

–840

Realized translation expenses–908

Interest expenses

–33

–40

Finance expenses

–138

–954

Realized translation result, net

885

Interest income

74

108

Finance income

74

993

Finance result, net

–64

39

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7.6

Income tax expense

Components of income tax expense
2015

2014

Income taxes relating to the current period

10,844

7,394

Income taxes relating to past periods, net

59

–793

Current income tax expense

10,9036,601

Due to temporary differences–1,503–1,745

–34

1,318

1,093

127

in thousands CHF

Due to tax rate changes
Due to (recognition) / use of tax loss carry-forwards
Adjustments to deferred tax assets

–40

109

Other effects (including acquisition)

21

–178

–463

–369

10,4406,232

Deferred income tax expense / (income)
Total income tax expense

Taxes on capital are included in other operating expenses (see note 7.3).
Deferred tax liabilities of CHF 0.2 million (2014: CHF 0.2 million) have not been recognized for w­ ithholding and other taxes on theunremitted earnings. Such distributable earnings which are subject to withholding tax are normally left in the respective companies.

Reconciliation of effective tax rate
2015

2014

Result before income taxes

39,74325,420

Income tax expenses at the expected tax rate of 20.7 % (2014: 20.1 %)

8,239

5,109

in thousands CHF(Tax credits) / tax charges on prior years’ results, net

59

–793

Effect from deviation to tax rates in Group companies

2,273

–990

Tax rate changes, net

–34

1,318

(Non-taxable income) / non-tax deductible expenses, net

710

707

(use of unrecognized tax losses)/effect of unrecognized tax losses on the current year’s result, net

–774

829

(Reversal of) / write-offs on deferred tax assets, net

–32

51

Other effects–1

1

10,4406,232

Effective (total) income tax expense

The income tax expense analysis is based on the expected tax rate for an ordinarily taxed company in Switzerland.

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104

Tax effects on and expiry dates of losses carried forward
31.12.2015

in thousands CHF

31.12.2014

not activatedactivated

not activated

2017

30

34

2018

661

662

2019

509

510

activated

Expiry
2016
30
64

2020
2021 and later

8,292

unlimited

10,921

Total

20,413

1,727

Tax benefit

6,191

787

Thereof unrecognizable–6,191

Deferred tax assets from carried forward losses

1,693

10,9794,468

15,103406

27,284

4,938

8,838

1,906

–8,838787

1,906

A tax effect of CHF 1.2 million resulted from new tax losses carried forward of CHF 4.0 million in 2015 (2014: new tax losses of CHF
3.8 million with a tax effect of CHF 1.3 million, whereof CHF 0.3 million were capitalized). During the year under review no tax assets
were capitalized.
Deferred tax assets on unused tax losses carried forward and based on temporary differencies are capitalized in case it is probable thatsuch assets can be set off against future taxable profits. Due to the probability to set off current tax losses carried forward against future
profits in various subsidiaries, an amount of CHF 0.8 million has been capitalized in 2015 (2013: CHF 1.9 million). Interroll considers
the future set off probable based on approved business plans. The majority of non-capitalized deferred tax assets on losses carried foward
concern US-based subsidiaries. The applicable tax rate for both years under review is 39 %.

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105

Attribution of deferred tax assets / liabilities to balance sheet items
31.12.2015

in thousands CHF

Intangible assets
Property, plant and equipment

Deferredtax assets

Deferredtax liabilities

Deferredtax assets

Deferredtax liabilities

799

1,644

1,632

2,018

1,117

2,482

1,032

2,657

Financial assets
Inventory

31.12.2014

649
1,291

394

286
376

670

Benefits of loss carry forwards

787

Receivables

181

1,404

96

266

Total assets

4,175

6,573

5,042

5,897

Long term debts

1,906

139

78

Provisions

2,371

2,506

1,992

2,917

Short term debts

1,213

65

554

1

Other liabilities

700

Total liabilities

4,423

2,571

2,637

2,918

Set-off–4,639–4,639–3,529–3,529Total net

3,959

4,505

4,150

5,286

13

Deferred tax assets and deferred tax liabilities are netted within and between companies belonging to the same taxable unit.

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OTHER DISCLOSURES TO THE FINANCIAL STATEMENTS

106

8

OTHER DISCLOSURES ON THE FINANCIAL STATEMENTS

8.1 Contingent liabilities and other commitments
In 2015 Interroll Group has committed to guarantees versus third parties in the amount of CHF 0.1 million (2014: CHF 0.3 million).
These guarantees are in relation to customer orders. There are no further contingent liabilities in both years under review.

8.2

Related party transactions

Transactions with related parties
VolumeCategory

2015

Purchase of materialsa310

Consulting servicesb

IT Investments / IT Services

a

234

206

Other purchases

a

28

6

572

2,925

in thousands CHF

Total purchases

Open payables

2014

31.12.2015

31.12.2014

591

22

15

1

3

23

18

2,122

VolumeOpen receivables

Category

2015

2014

31.12.2015

31.12.2014

Sale of material

a

188

338

15

38

Other income

b

15

38

in thousands CHF

Total services

15
188

353

Definition of related parties
Interroll Group defines and categorizes its related parties as follows:a) Shareholders of Interroll Holding Ltd. holding more than 3 % of the shareholder capital.
b) Members of the Board of Directors of Interroll Holding Ltd. and legal entities that are directly controlled by them.
c) Members of Group Management of Interroll Group and legal entities that are directly controlled by them.
d) Local managing directors as well as people reporting to them (only for substantial transactions).

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OTHER DISCLOSURES TO THE FINANCIAL STATEMENTS

107

Total compensation to the Board of Directors
Total compensation in the year 2014 to the Board of Directors of Interroll Holding Ltd. is CHF 0.58 million (2013: 0.54 million). The
detailed disclosure on the compensation to and shares owned by the Board of Directors and Group Management required by Swiss law
are included in the Compensation Report.
Total compensation to Group Managementin thousands CHF

2015

2014

Salaries incl. bonus

3,708

3,780
557

Post-employment benefits

566

Equity based compensation

1,052

903

Total compensation to the Group Management

5,326

5,240

In the period under review as well as in the previous year no loans were granted.
The detailed disclosure of the compensation and equities held by the Group Management in line with Swiss law (OR) can be found in
the Compensation Report.

8.3 Subsequent events
The consolidated financial statements for the year 2015 were approved by the Board of Directors on 3 March 2016 and are subject tofurther approval by the Annual General Meeting of the Shareholders on 13 May 2016.
No event has occurred between 31 December 2015 and 3 March 2016 which would require adjustment to the carrying amountof the Group’s assets and liabilities as per 31 December 2015, or would require disclosure in accordance with IAS 10.

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108

8.4

Scope of consolidation

Name
Name

Location
Location (country)(country)

Function
Function

Owner
Owner

Share
Share capital
capitain1’000
1,000 Ownership in %Sant’Antonino (CH)

F

0

CHF

Switzerland
Interroll Holding AG

854.0

Interroll SA

Sant’Antonino (CH)

P

HD

CHF

100.0

100 %

Interroll (Schweiz) AG

Sant’Antonino (CH)

F

HD

CHF

5,000.0

100 %Interroll Management AG

Sant’Antonino (CH)

F

HD

CHF

100.0

100 %

EMEA (without Switzerland)Interroll Fördertechnik GmbH

Wermelskirchen (DE)

S

DP

EUR

25.6

100 %

Interroll Engineering GmbH

Wermelskirchen (DE)

P

DHO

EUR

1,662.2

100 %Interroll Automation GmbHSinsheim (DE)

P

DHO

EUR

2,000.0

100 %Interroll Holding GmbH

Wermelskirchen (DE)

F

HD

EUR

500.0

100 %

Interroll GmbH

Wermelskirchen (DE)

D

HD

EUR

25.0

100 %

Interroll Trommelmotoren GmbH

Baal / Hückelhoven (DE)

P

DHO

EUR

77.0

100 %

Interroll SAS

Saint-Pol-de-Léon (FR)

F

HDE

EUR

2,808.0

100 %Interroll SAS

La Roche sur Yon (FR)

P

F

EUR

2,660.0

100 %Interroll SAS

Saint-Pol-de-Léon (FR)

S

F

EUR

61.0

100 %

Interroll Nordic AS

Hvidovre (DK)

S

DKP

EUR

67.1

100 %

Interroll Joki AS, Hvidovre

Hvidovre (DK)

P

HD

EUR

2,013.8

100 %Interroll Ltd.

Kettering (GB)

S

HDE

GBP

0.0

100 %

Interroll Engineering Ltd.

Corby (GB)

D

HDE

GBP

0.1

100 %

Interroll Italia Srl

Rho (IT)

S

HDE

EUR

10.0

100 %

Interroll España SA

Cerdanyola del Vallès (ES) S

HDE / TI

EUR

600.0

100 %

Interroll CZ sro.

Breclav (CZ)

S

HDE

CZK

1,000.0

100 %Interroll Europe BV

Emmeloord (NL)

F

HD

EUR

90.8

100 %

Interroll Polska Sp. z o.o.

Warszaw (PL)

S

HD

PLZ

100.0

100 %

Interroll Lojistik Sistemleri

Istanbul (TR)

S

HD

TRY

1,000.0

100 %Interroll SA (Proprietary) Ltd.

Johannesburg (ZA)

S

HD

ZAR

0.3

100 %

AmericasInterroll Corporation

Wilmington, NC (US)

P/S

IAU

USD

65.0

100 %

Interroll USA Holding, LLC

Wilmington, DE (US)

F

HD

USD

0.1

100 %

Interroll Engineering West, Inc.

Cañon City, CO (US)

P/S

HDP

USD

0.0

100 %

Interroll Atlanta, LLC

Hiram / Atlanta, GA (US)

P/S

IAU

USD

0.0

100 %

Interroll Real Estate, LLC

Wilmington, DE (US)

F

IAU

USD

0.0

100 %

Interroll Canada Ltd.

Aurora (CA)

P/S

HD

CAD

1,720.1

100 %Interroll Logistica Ltda.

Jaguariuna / S. Paolo (BR) P / S

E

BRL

9,049.7

100 %5_INT_GB2015_Finance_EN.indd 108

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OTHER DISCLOSURES TO THE FINANCIAL STATEMENTS

109

Name

Location (country)

Function

Owner

Share capital in 1,000 Ownership in %Asia-PacificInterroll (Asia) Pte. Ltd.

Singapore (SG)

S

HDE

SGD

18,625.0

100 %Interroll Suzhou Co. Ltd.

Suzhou (CN)

P/S

SGP

CNY

42,490.2

100 %(Shanghai) Co. Ltd.

Shanghai (CN)

S

SGP

CNY

3,066.5

100 %Interroll Shenzhen Co. Ltd.

Shenzhen (CN)

P

SGP

CNY

5,770.0

100 %Portec Asia Limited

Hong Kong (CN)

S

SGP

HKD

700.0

100 %

Interroll Australia Pty. Ltd.

Victoria (AU)

S

HD

AUD

51.2

100 %

Interroll (Thailand) Co. Ltd.

Panthong (TH)P/S

SGP / HD

THB

100,000.0

100 %Interroll Japan Co. Ltd.

Tokyo (JP)

S

HD

JPY

10,000.0

100 %Interroll (Korea) Corporation

Seoul (KR)P/S

SGP / HDKRW

1,500,000.0

100 %Interroll Holding Management

Function: P = Production, S = Sales, F = Finance, D = dormant
Owner: HD = Interroll Holding Ltd., HDE = Interroll Europe BV, TI = Interroll SA, DHO = Interroll Holding GmbH, DKP = Interroll Joki AS,
F = Interroll SAS, Saint-Pol-de-Léon, E = Interroll España SA, SGP = Interroll (Asia) Pte. Ltd., Singapore, IAU = Interroll USA Holding LLC

Movements within the scope of consolidation in 2015
During the year under review the share capital of the Interroll Holding AG was reduced from CHF 8.5 million to CHF 0.854 million.
Portec International Ltd. in Leicester (UK) was liquidated. Portec Group International, Inc. in Cañon City (US) was merged down into
Interroll Engineering West, Inc. Furthermore, Interroll Dynamic, Inc. (US) changed its name to Interroll Real Estate, Inc. and moved
its legal location to Wilmington, DE (US).
Movements within the scope of consolidation in 2014
In Shanghai, China Interroll Holding Management (Shanghai) Co. Ltd. was started up. Furthermore, in 2014 a 40 % minority stake into
Portec Asia Limited in Hong Kong, China, and 100 % of the shares of Pert Engineering Limited in Shenzhen, China, were bought. Pert
Engineering Limited subsequently changed its name to Interroll Shenzhen Co. Ltd. Portec Asia Limited in Hong Kong is now held byInterroll (Asia) Pte. Ltd. in Singapore, Singapore (2013: Portec Group International in Cañon City, US). In 2014 the share capital of Interroll Logistica Ltda in Brazil was increased by BRL 8,050 from BRL 1,000 to BRL 9,050. Interroll Automation LLC, formerly located in
Jeffersonville, IN trades now under the name Interroll USA Holding LLC and is registered in Wilmington, DE, USA, as a holding company.

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REPORT OF THE STATUTORY AUDITOR

110

9REPORT OF THE STATUTORY AUDITOR

Report of the statutory auditor to the Annual General Meeting on the consolidated
financial statements 2015
Report of the statutory auditor on the consolidated financial statements
As statutory auditor, we have audited the consolidated financial statements of INTERROLL HOLDING LTD,
which comprise the balance sheet, income statement, statement of comprehensive income, cash flow
­statement, statement of changes in equity and notes (pages 60 to 109), for the year ended 31 December 2015.
Board of Directors’ responsibility
The Board of Directors is responsible for the preparation and fair presentation of the consolidated financial
statements in accordance with the International Financial Reporting Standards (IFRS) and the requirementsof Swiss law. This responsibility includes designing, implementing and maintaining an internal control system
relevant to the preparation and fair presentation of consolidated financial statements that are free from­material misstatement, whether due to fraud or error. The Board of Directors is further responsible for­selecting and applying appropriate accounting policies and making accounting estimates that are reasonable
in the circumstances.
Auditor’s responsibility
Our 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 the 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 purpose of expressing an opinion on theeffectiveness 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 theoverall 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.

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REPORT OF THE STATUTORY AUDITOR

111

OpinionIn our opinion, the consolidated financial statements for the year ended 31 December 2015 give a true and fairview of the financial position, the results of operations and the cash flows in accordance with the International
Financial Reporting Standards (IFRS) and comply with Swiss law.
Report on other legal requirements
We confirm that we meet the legal requirements on licensing according to the Auditor Oversight Act (AOA) andindependence (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 aninternal 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.
PricewaterhouseCoopers AG

Patrick Balkanyi				Remo Zenegaglia
Audit expert				Auditor in charge
Zürich, 3 March 2016

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6_INT_GB2015_Finance_EN.indd 112

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FINANCIAL STATEMENTS OF INTERROLL HOLDING LTD.

113

FINANCIALSTATEMENTS
OF INTERROLLHOLDING LTD.

6_INT_GB2015_Finance_EN.indd 113

1

FINANCIAL STATEMENTS OF INTERROLL HOLDING LTD.

114

2

GENERAL INFORMATION ON THE FINANCIAL STATEMENTS

116

3

NOTES ON THE FINANCIAL STATEMENTS 

117

4

OTHER DISCLOSURES ACCORDING TO SWISS LAW119

5

PROPOSED APPROPRIATION OF AVAILABLE EARNINGS

119

6

REPORT OF THE STATUTORY AUDITOR

12004.03.16 16:19

FINANCIAL STATEMENTS OF INTERROLL HOLDING LTD.

114

1

FINANCIAL STATEMENTS OF INTERROLL HOLDING LTD.

1.1

Balance sheet

in thousands CHF

see notes*

31.12.2015

31.12.2014

ASSETS
592

1,141

Accounts receivable from subsidiaries

1,144

1,268

Other receivables from third parties

126

197

1,862

2,606

106,957

106,957

Cash and cash equivalents

Total current assets
Investments

39,757

9,615

Total non-current assets

146,714

116,572

Total assets

148,576

119,178

Trade and other accounts payable from subsidiaries

337

264

Trade and other accounts payable from third parties

43

Loans to subsidiaries

3.3

EQUITY AND LIABILITIESLoans from subsidiaries

77
1,648

3.4

Accrued expenses

1,887

1,069

Total current liabilities

2,267

3,058

854

8,540

Total non-current liabilities
Share capital

3.5

Legal reserve– Share premium– Other legal reserve– Available earnings

8

8

5,209

5,209

141,861

104,371–1,623–2,008

Total shareholder's equity

146,309

116,120

Total liabilities and equity

148,576

119,178

Own shares

3.1* See notes to the financial statements.

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FINANCIAL STATEMENTS OF INTERROLL HOLDING LTD.

115

1.2

Income statement2015

in thousands CHF

2014

Investment income

37,534520

Royalty income

3,524

3,165

Other operating income

1,333

1,334

Financial income

1,431

1,396

Total income

43,822

6,415

Administration expenses

–468

–504

Personnel expenses–1,886–1,877

Other operating expenses–1,510–1,236

Financial expenses–2,468–749

Total expenses–6,332–4,366

Result before income taxes

37,4902,049

37,4902,049

Direct taxes
Result1.3

Statement of changes in equity

in thousands CHF

Share capital

Reserves from
capital contrib.

Legal reserve

Available
earnings

Own shares

Total

As of 1.1.2014

8,540

7,501

5,209

102,322–1,641

121,931

Result 2014

2,049

2,049

Distribution from approbrationfrom capital contributions–7,493–7,493

Change of balance for own shares
Per 31.12.2014

8,540

8

5,209

Result 2015
Distribution from face value reduction

104,371

6_INT_GB2015_Finance_EN.indd 115–367–2,008116,120
37,49037,490–7,686–7,686

Change of balance for own shares
Per 31.12.2015

–367

854

8

5,209

141,861

385

385–1,623

146,30904.03.16 16:19

GENERAL INFORMATION TO THE FINANCIAL STATEMENTS

116

2

GENERAL INFORMATION ON THE FINANCIAL STATEMENTS

2.1

Accounting Policies

Accounting law
These financial statements were prepared according to the provisions of the Swiss Law on Accounting and Financial Reporting (32ndtitle of the Swiss Code of Obligations). To allow comparison previous year figures of the balance sheet and profit and loss statement wererestated to align with the new classification regulation.
In particular following positions changed:
Own shares are recognized at acquisition cost and deducted from shareholders’ equity at the time of acquisition. The reserve for own
shares was dissolved accordingly and assigned to the opening balance as per 01.01.2014 of the position available earnings.
Alike the provisions for investments already existing in the previous year are now contained in the position investments.
Current / Non-current distinction
Current assets are assets expected to be realized or consumed in the normal course of the Company’s ­operating cycle or assets held for
trading purposes. All other assets are classified as non-current assets.
Current liabilities are liabilities expected to be settled by use of cash generated in the normal course of the Company’s operating cycle or
liabilities due within one year from the reporting date. All other liabilities are classified as non-current liabilities.
Foreign currency translation
Transactions in foreign currencies are recorded using exchange rates prevailing at the time of the transaction. Gains or losses arising on
settlement of these transactions are included in the current year’s income under financial income and financial expenses respectively.
Monetary assets and liabilities denominated in foreign currencies are translated using the exchange rates prevailing at the balance sheet
date. Any gains or losses resulting from this translation are also included in the current year’s income, except for unrealized gains which
are deferred.
Foregoing a cash flow statement and additional disclosures in the notes
As Holding Ltd has prepared its consolidated financial statements in accordance with a recognized accounting standard (IFRS), it
has decided to forego presenting additional information on interest-bearing liabilities and audit fees in the notes as well as a cash flow
statement in accordance with the law.

2.2

Principles of valuation

Cash and cash equivalents, accounts receivable and payable
Cash and cash equivalents are stated at nominal value. Accounts receivable are stated at nominal value less any valuation adjustment for
credit risks. Accounts payable are stated at nominal value. Accounts receivable from Group companies arise from services provided byInterroll Holding Ltd. and related interest and ­royalties billed. These services are recognized on an accrual basis.
Own shares
Own shares are stated at the lower of cost and fair value.
Loans
Non-current loans receivable are stated at nominal value less any valuation adjustments deemed necessary to reflect the credit risk.
Non-current loans payable are stated at nominal value.
Investments
Investments are stated at cost less any valuation adjustments deemed necessary to recognize a decline other than temporary in value(impairment). Additional provisions are recognized for general investment risks.
Accrued expenses
Accrued expenses primarily relate to interest due on loans payable stated at nominal value and to accruals for the compensation of theBoard of Directors.

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NOTES TO THE FINANCIAL STATEMENTS

117

3

NOTES ON THE FINANCIAL STATEMENTS

3.1

Own shares

Shares sold, acquired and held in the periods under review
In the year under review, the Company did sell 502 own shares at an average price of CHF 800.44 (previous year: the Company did notsell any own shares). In the year under review, the Company did acquire 1,360 shares (previous year: 2,090 shares). At year end 2015,
the Company held 2,985 own shares at a book value of CHF 1.6 million (2014: 4,170 own shares at a book value of CHF 2.0 million).
Attribution of own shares to employees
2,043 shares (previous year: 1,769 shares) at a carrying value of CHF 1.0 million (previous year: CHF 0.9 million) were attributed
to employees.

3.2 Investments
An overview of the material investments either directly or indirectly held by Interroll Holding Ltd. can be found in the notes on the
consolidated statements of the Interroll Group (see 8.4 “Scope of consolidation”).

3.3

Loans to subsidiaries

The interest rates used were the following:

lowesthighestIn the year 2015

0.00 %

3.50 %In the year 2014

0.00 %

4.50 %The loans due to subsidiaries are normally redeemable with a notification period of three months. As of year end, the total outstanding group loans amounted to CHF 39.8 million (2014: CHF 9.6 million). For loans amounting to CHF 2.8 million (previous year:
CHF 2.8 million) a valuation allowed has been accounted for.

3.4

Loans from subsidiaries

The following interest rates were used:lowesthighestIn the year 2015

0.25 %

0.25 %In the year 20141.50 %

4.50 %The loans due from subsidiaries are normally redeemable with a notification period of three months. As of year end 2015, the total outstanding group loans amounted to CHF 0.0 million (2014: CHF 1.6 million).

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NOTES TO THE FINANCIAL STATEMENTS

118

3.5

Shareholders' equity

Composition of the share capital
The share capital consists of 854,000 fully paid-in registered shares with a par value of CHF 1 each (­ previous year: CHF 10). Each shareentitles to equal dividend and voting rights.
Significant shareholders (at least 3 % of the share capital)
The following table shows the number of shares held by the most significant shareholders as well as their participation in percent.
31.12.2015

31.12.2014

Number of sharesparticipationin %Number of sharesparticipationin %B. Ghisalberti, E. Moreschi and Family

109,213

12.79

11,1243

13.03

D. Specht and Family

82,3409.64

86,695

10.15

Allianz Group

50,084

5.86

50,084

5.86

Schroders PLC

43,833

5.13

43,833

5.13

Kempen European Participations N.V.

43,554

5.10

43,554

5.10

Sarasin Investmentfonds AG

40,1504.70

66,850

7.83

N. Axmann and Family

39,017

4.57

39,017

4.57

Swisscanto Fondsleitung AG

34,371

4.02

0

0.00

Various other shareholders

411,438

48.19

412,724

48.33

Total

854,000

100.00854,000

100.00Shareholder / Shareholder Group

3.6 Contingent liabilities
Interroll Holding Ltd. has issued a guarantee for an existing shared credit facility in the amount of CHF 42 million (previous year:
CHF 42 million) in favor of Interroll (Schweiz) AG. The credit facility was not utilized on 31 December 2015.
In addition, payment guarantees of CHF 0.4 million (previous year: CHF 0.0 million) were made to customers.
In addition, Interroll Holding Ltd. issued letters of continuing financial support in favor of the following Group companies:
Country

Company

Germany

Interroll Automation GmbH, Sinsheim (DE)FranceInterroll SAS La Roche sur Yon (FR)Switzerland

Interroll (Schweiz) AG, Sant'Antonino (CH)

CanadaInterroll Canada Ltd., Aurora (CA)Interroll Holding Ltd. carries joint liability with respect to the federal tax authorities for value added tax debts of all Swiss subsidiaries.

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

OTHER DISCLOSURES ACCORDING TO SWISS LAW

119

4	OTHER DISCLOSURES ACCORDING TO SWISS LAW
4.1 Full-time equivalents
The annual average number of full-time equivalents for the reporting year, as well as the previous
Year is zero.
4.2 Compensation of and shares held by the Board of Directors and the Group Management
The compensation of the members of the Board of Directors and the Group Management as well as the shares and options held by themembers of the Board of Directors at year end are disclosed in the Compensation Report in accordance with VegüV and the Swiss Codeof Obligations 663c (see Compensation Report, pages 51 to 58).
4.3

Shares held by Group Management
Shares as of 31.12.

2015

2014

Paul Zumbühl

18,59817,268Tim McGill

3,205

3,003

Dr. Christoph Reinkemeier

516

390

Dr. Ralf Garlichs

390

350

Daniel Bättig

329

147

Dr. Ben Xia

161

Jens Karolyi
Total

5

104

83

23,303

21,241

2015

2014

PROPOSED APPROPRIATION OF AVAILABLE EARNINGS

Appropriation of available earnings
in thousands CHF

Result37,4902,049

Available earnings carried over from previous year

104,371

102,322

141,861

104,371

Distribution of a dividend of

10,248to be carried forward

131,613
141,861

The Board of Directors proposes to the General Assembly as of 13 May 2016 to appropriate the available earnings as per end of the year
under review as follows:

Proposed dividend payment
The Board of Directors proposes to the General Assembly to pay a dividend in the amount of CHF 12.00 per share. In total a maximumof CHF 10.2 million is proposed to be paid out. In the previous year a reduction in nominal value of the Interroll share in the amount of
CHF 9.00 or a total of CHF 7.7 million was paid out. If the dividend is approved, the respective payment will be processed in the second
quarter of 2016.

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REPORT OF THE STATUTORY AUDITOR

120

6REPORT OF THE STATUTORY AUDITOR

Report of the statutory auditor to the General Meetingon the financial statements 2015
Report of the statutory auditor on the financial statements
As statutory auditor, we have audited the financial statements of INTERROLL HOLDING LTD, which comprise thebalance sheet, income statement and notes (pages 114 to 119), for the year ended 31 December 2015.
Board of Directors’ responsibility
The 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 responsibility
Our responsibility is to express an opinion on these financial 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 performthe 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 ofmaterial 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 inorder 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 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 sufficientand appropriate to provide a basis for our audit opinion.

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REPORT OF THE STATUTORY AUDITOR

121

OpinionIn our opinion, the financial statements for the year ended 31 December 2015 comply with Swiss law andthe company’s articles of incorporation.
Report on other legal requirements
We 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 aninternal 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 comply with Swiss law and the­company’s articles of incorporation. We recommend that the financial statements submitted to you be approved.
PricewaterhouseCoopers AG

Patrick Balkanyi
Audit expert
Auditor in charge

Remo Zenegaglia

Zürich, 3 March 2016

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FINANCIAL CALENDAR
2016
Preliminary Financial Figures 2015 (unaudited)

22 January

Publication Annual Report 2015 and Balance Sheet Press Conference

18 March

Annual General Assembly

13 MayPublication Half-Year Report 2016 and Web Conference (English)

5 August

CONTACT UND IMPRINT
If you have any questions regarding Interroll Group or
would like to be included in our distribution list pleasecontact the Investor Relations Team:
Investor.relations@interroll.com

Erwin Teichman
Head of PR & Investor Relations
Tel: +41 91 850 25 21
Email: e.teichmann@interroll.com
EditorInterroll Holding AG
Via Gorelle 36592 Sant’Antonino, Schweiz
Tel: +41 91 8502525
Fax: +41 91 8502505
www.interroll.com
LayoutCalydo, Steinhausen (Zug)
Produktion
GateB, Steinhausen (Zug)
Druck
Victor Hotz AG, Steinhausen (Zug)

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NOTE ON THE ANNUAL REPORTThis annual 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 annual 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 of a similar kind. Such future-­oriented statements are subject to risks and uncertainties since they relate to future events and are based on thecompany’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 events­including the financial position and profitability of the Interroll Group and developments in the economic andregulatory 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 positionand profitability and the economic and regulatory fundamentals, are in accordance with such future-oriented
statements in this annual report, no guarantee can be given that this will continue to be the case in the future.

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Interroll Holding Ltd.
Via Gorelle 3 | 6592 Sant᾽Antonino | Switzerland
www.interroll.com© Interroll Holding AG