Contents

4

Welcome8

Leading the world10

Financial results

14

Our five businesses
Automation
Automotive
Renewable Energy
Energy Distribution and High Precision
Track

26

New headquarters

32

Trends, technology, R&D
Product launches 2022/23

38

Culture, talent & values
Executive Committee
Board of Directors

46

Responsibility
ESG Key Performance Indicators

52

Financial Report
PDF download:
www.lem.com/en/investors

Information for investors

Welcome

We are pleased to report record annual
results for the year. Our revenues andprofitability show high demand for our
products and the strengths of theorganization to excel despite challenges
throughout the year. LEM is preparing
for the future, and our people areembracing change with determinationand flexibility, working on innovative
solutions in rapidly accelerating businessenvironments. Our new headquarters
in Meyrin, Geneva, is a major milestone
for LEM, and the positive impact it hason our company and culture is featured
in this Annual Review.

LEM’s long-term prospects are driven by megatrends
such as electrification, decarbonization, renewableenergy, automation, and mobility. We are investing incustomer closeness and speed to market, and attracting new talent to capture opportunities emerging from these trends and to maintain our position as
global market leader in electrical measurement. Our
purpose is clear: We are helping customers and society to accelerate the transition to a sustainable
future.
A successful, challenging year
We are delighted to report record annual results. Ourrevenues demonstrated the fundamental demand forour products and the strengths of the company operationally. The megatrends that drive our businessare accelerating and offering many opportunities tocapture substantial growth. We thank our teams
around the world, who showed great flexibility anddetermination to find innovative solutions, so we canbenefit from those advantageous circumstances.
We are further rolling out our new regional organization, moving decision-making closer to the customer
and empowering local management in the regions.
While the process is demanding, we are making
good progress. The management team has achieved
our aspired strength, competence, and experience
to bring LEM to the next level. All leaders at LEM areinvited to role model Blue Behaviors: with innovationand continuous improvement, customer orientationand growth, team player mindset and learner attitude.

Challenges due to the pandemic started with lockdowns in China in April and May and then again in
November, followed by the sudden lifting of restrictions in December. This stalled production in China,
intensified component shortages, and challenged
our supply chains. We were unable to deliver on allorders in China and around the world. Teams werehighly solution oriented in establishing secondsources. They also stepped up communication withlongstanding and new customers and suppliers,
working together openly and diligently on the best
possible solutions as well as fair allocations acrosscustomers. Trust and strong relationships were key
here, especially as competition increased. Remarkably, we emerged from these challenges stronger
than ever. This was a major achievement for the LEM
team.
New headquarters — change made visible
We moved to our new headquarters in Meyrin, Geneva, in April 2022 and celebrated this together withour 50th anniversary during the Inauguration Day in
November. For LEM Geneva, located since 1988 in
offices at the CTN industrial park in Plan-les-Ouates,
our new headquarters is a major milestone in LEM’s
corporate transition.
Our new headquarters has a global coordination
function, empowers regional teams to executive efficiently, and makes us flexible to capture growth. It
brings together more than 250 employees with a richvariety of expertise in a modern and sustainable
working environment – ideal for innovation, which iscore to our DNA. In the light, clean, open spaces ofthe building, our culture and our ambition are visible.

This new 12’000-square-meter facility will allow us
to meet growing customer demand globally and give
us new skillsets and flexibility in our supply chain.
Penang will be the main testing base for our integrated current sensor (ICS) products, which are in great
demand from customers in our Automation, Automotive, and Renewable Energy businesses. Hiring is
progressing well, and we will benefit from excellent
local talent and experience, especially in the semiconductor area. We will start with 50 employees andexpect to grow to 500 in a few years.
R&D and future technologies
More than half of our R&D investment goes into developing our core current sensor products and therest into developing new products for new and adjacent markets. In addition to developing product lines,
our R&D teams have developed three entirely new
platforms, in metering, integrated current sensing,and smart grid. This is impressive and substantiates
our investment. In 2022/23 we launched 9 products.
We continue to build specific competence centers
across our sites in Geneva, Lyon, Beijing, and Sofia.
Our R&D teams provide a diversified skillset and ingenuity, plus the determination to constantly develop new solutions. Investing in integrated current
sensors has proven to be the right move, and we arebuilding out this capacity. Our software competency
is also increasing across sites. In addition, we areworking on the development of AC measurement for
smart grid and highly sophisticated magnetic sensing technology.

Our geographic footprint
We aim at a sufficiently diversified geographic footprint to enable full supply assurance in each region
as well as a natural currency hedge. In the US, ourreinforced leadership team pursues new opportunities in EVs and the EV charging infrastructure. Malaysia will be the seventeenth country in which we operate and will further balance our global footprint.
Construction at the Penang site is on time, and we
expect to be ready for production early 2024.

LEM Annual Review 22 | 23

4

5

LEM Annual Review 22 | 23

Welcome

Robust results
This year’s record performance reflects yet again thefundamental global trend towards decarbonizationand electrification, but also our corporate culture ofinnovation and agility to respond to customer demands. We achieved our record results despite lockdowns in China, supply chain difficulties, and geopolitical challenges. Sales increased by 8.8 % from CHF
373.4 million last year to CHF 406.4 million this financial year. Without the foreign exchange impact, sales
would have increased by 12.6 %. EBIT increased by
4.3 % to CHF 92.2 million, while the EBIT margin decreased to 22.7 % from 23.7 % in 2021/22. We posted a net profit of CHF 75.3 million, up from CHF
72.4 million last year.
Our balance sheet is strong and we continue to generate healthy cash flow. Based on these excellent
results for the year 2022/23 and the long-term fundamentals for the business, the Board of Directors
proposes a dividend of CHF 52 per share, up from
CHF 50 per share.
Strategic focus and outlook
We are investing in next generation applications andpartnerships with customers in adjacent markets thatare closely connected to current measurement. We
are pleased with the steady, organic growth at LEM
that yields success and motivation year after year for
all stakeholders. In the financial year ahead, ourgrowth will continue, with the opening of LEM Malaysia and with our metering and integrated circuit sensors businesses reaching the next level. In the future, we look forward to further applications in
automotive, metering, and electrical safety, with newsensors for intelligent EV charging, for renewableenergy storage plants and robotics, and for functional safety.

LEM Annual Review 22 | 23

6

Thank you
On behalf of the Board of Directors and the Executive
Management, we thank our shareholders and our
employees, customers, suppliers, and partners forthe confidence they have placed in us. Our talented
teams worldwide have demonstrated yet again theircommitment and ingenuity – and the resolve to contribute to the transformation taking place at LEM. Our
performance is also due to the trusted relationships
we have developed with customers, suppliers, andbusiness partners with whom we work closely tobring new innovative products to market. All of us at
LEM are inspired by a common purpose: helping ourcustomers and society accelerate the transition to asustainable future. We hope you enjoy this Annual
Review and learn something new about LEM.

Andreas Hürlimann
Chairman of the Board of Directors

Frank Rehfeld
Chief Executive Officer

life
Our new headquarters in Meyrin, Geneva, and ourcelebrations of LEM’s 50th year as a company there
in November 2022 were full of positive energy
and inspiration for the future. LEM talent, investors,
customers, partners, and key stakeholders cansee and feel transformation underway. We are proud
to report record performance again this year.

energyBehind the numbers, the new premises, and stellar
events are LEM people. Skilled individuals with a strong
sense of resolve keep our company improving andgrowing. Although at times over the past year, the pandemic and component constraints depleted our energy
and disrupted our plans, LEM people persevered byremaining strong, caring, and positive.

motionThe electronic sensor industry is changing fast, being
shaped by continuous technological breakthroughs.
The rapid rise in the electrification of the world is driving
change faster than ever before. We are focused andmoving fast to capture growth opportunities in all of ourmarkets, pursuing our purpose: to help our customers
and society accelerate the transition to a sustainable
future.

Leading the world inelectrical measurement

E ME A

Geneva, Switzerland
Frankfurt, Germany
Vienna, Austria
Brussels, Belgium
Randers, Denmark
Paris, France
Padova, Italy
Skelmersdale, UK
Lyon, France
Sofia, Bulgaria
C H INA

BeijingShanghai
Shenzhen
Xian
Hefei
Taipei, Taiwan
Wuhan

LEM headquarters
Geneva, Switzerland

A ME R ICAS

Milwaukee, Wisconsin
Detroit, Michigan
Bridgewater, New Jersey
Columbia, South Carolina
Los Angeles, California
R E ST O F AS IA

Pune, India
Seoul, South Korea
Tokyo, Japan
Penang, Malaysia ** Penang site is still
under construction

P R O D U CTI O N | R &D | SAL ES
AG E NTS | DISTR IB UTO RS

A leading company in electricalmeasurement, LEM engineers the bestsolutions for energy and mobility,
ensuring that our customers’ systems
are optimized, reliable, and safe.

LEM Annual Review 22 | 23

8

Our 1,700 people in 17 countries transform
technology potential into powerful answers.
We develop and recruit the best global talent,
working at the forefront of megatrends,
such as renewable energy, mobility, automation,and digitization.

With innovative electrical solutions,
we are helping our customers and society
accelerate the transition to a moresustainable future.

9

LEM Annual Review 22 | 23

Financial results

Record financial performance
Sales in the financial year 2022/23 totaled CHF
406.4 million up by 8.8 % from CHF 373.4 million; atconstant exchange rates, sales increased by 12.6 %.
We achieved this despite lockdowns in China, supply
chain difficulties, and geopolitical challenges.
LEM’s diversity of applications across multiple sectors of the global economy provides a steady flow oforders and a prudent spread of risk. We also benefit
from a good geographic spread of business and interms of relative share, the regions remained stablewith China at 38.9 % of sales, EMEA at 31.4 %, Restof Asia at 17.5 %, and Americas at 12.3 %. All regions
grew by one digit growth, except for Americas, whichgrew by 32.9 %, mainly due to the impact of government policies on the demand for electric vehicles.

During the financial year 2022/23, orders were downby 19.3 % at CHF 465.2 million compared with CHF
576.4 million in 2021/22. The full year book-to-bill ratio
reached 1.14, down from 1.54.

in CHF millions

2020/212021/222022/23
465.2

320.5

322.4

362.0

576.4

Book-to-bill ratio

1.00

1.05

1.20

1.54

1.14

Sales

321.6

307.9

301.0

373.4

406.4

SG&A costs were up by 14.1 % to CHF 68.1 million(CHF 59.7 million) and accounted for 16.8 % of sales(16.0 %). This increase reflects our digitalization projects (investment in software and hardware), external
consulting support for several key initiatives, and recruitment of additional talent.

EBIT

EBIT increased by 4.3 % to CHF 92.2 million from CHF
88.4 million, primarily due to improved sales. Our reported EBIT margin was down, at 22.7 % comparedwith 23.7 % last year.
The negative impact of foreign exchange translations
was CHF 1.9 million, compared to CHF 2.7 million lastyear, mainly due to depreciation of the EUR. The
Group tax expenses of CHF 13.6 million represent a tax
rate of 15.3 %.

Gross margin
in % of sales
in % of sales

146.5

142.7

140.6

177.3

192.2

45.6%

46.4%

46.7%

47.5%

47.3%

64.8

58.3

60.9

88.4

92.2

20.1%

18.9%

20.2%

23.7%

22.7%

Net profit for the year

52.4

60.7

55.6

72.4

75.3

EPS basic (CHF)

45.97

53.27

48.79

63.48

66.12

Dividend per share (CHF)

42.00

40.00

42.00

50.00

52.00 1

Operating cash flow

53.5

73.6

50.9

50.4

87.4

Investing cash flow

–14.8

–14.7

–13.5

–21.0

–26.9

31.3.2019

31.3.2020

31.3.2021

31.3.2022

31.3.2023

In CHF millions, %Net financial cash/(debt)
Shareholders’ equity

4.5

10.2

–1.6

–23.5

–21.8

113.1

117.4

131.9

161.2

173.6

Equity ratio (in % of assets)

60.5%

51.0%

49.9%

53.5%

53.0%

Market capitalization

1’459.2

1’210.7

2’082

2’554

2’241

Employees (in FTEs)

1’477

1’497

1’448

1’575

1’716

1 Proposal of the Board of Directors to the Annual General Meeting of Shareholders on June 29, 2023.

Sales per business

Regional sales breakdown

in CHF millions

in CHF millions

180

180

150

150

120

120

90

90

60

60

30

30

0

18/19

19/20

20/21

21/22

22/23

0

18/19

19/20

20/21

21/22

Automation

Automotive

China

Rest of Asia

Renewable Energy

Energy Distribution &High Precision

EMEA

Americas

Track

10

2019/20

Orders received

We posted a record net profit for the year of CHF
75.3 million, up from CHF 72.4 million last year. The
profit margin decreased to 18.5 % compared with
19.4 % last year.

LEM Annual Review 22 | 23

2018/19

Gross profit was up by 8.4 % at CHF 192.2 million(CHF 177.3 million), while the gross profit margin decreased slightly to 47.3%, sales price increases being
offset by purchase price increases.

We continue with our long-term investment in futureapplications, with R&D up in absolute terms by 9.5 %to CHF 32.2 million (CHF 29.4 million), or flat at 7.9 %of sales.

Top-line growth of 8.8%, andan EBIT margin of 23.1% are indeed
pleasing. Without the foreignexchange impact, sales
would have increased by 12.6%.

Key figures 2018/19 to 2022/23

11

22/23

LEM Annual Review 22 | 23

Financial results

Strong cash flow and balance sheet
Cash flow from operating activities was CHF 87.4 million (CHF 50.4 million), and free cash flow was CHF
60.5 million (CHF 29.4 million). This reflects thehealthy financial situation. Our balance sheet remains
strong with limited net debt of CHF 21.8 million. As of
31 March 2023, total assets increased to CHF 327.5
million. Shareholders’ equity reached CHF 173.6 million, representing an equity ratio of 53.0 % (53.5 %as of 31 March 2022).

Outlook
Our businesses have proven successful and will benefit as the megatrends of decarbonization and electrification continue to be fundamental growth drivers.
The building and staffing of our new production plantin Malaysia is advancing well, and we plant to start
production by early 2024. We continue to invest in
R&D at between 8 % – 10 % of sales, ensuring LEM
has the right new technologies and applications forcustomers.
For the mid and long term, we are confident about ourcompany’s growth. Demand remains high for our
products, as they play an important role in the acceleration of the shift towards sustainability. We see
many opportunities to capture future growth. In the
short term, however, growth may be affected in somebusinesses and regions by market adjustments andcomponent shortages. There may be slowdowns resulting from geopolitical tensions as well. Therefore,
we will remain vigilant for the next 12 months. Nevertheless, we see our orderbook normalizing towards
the 3-4 months visibility that we had before the supply chain challenges started.

8.8 %Sales growth

22.7

%

EBIT margin % of sales

75.3 mRecord net profit

LEM Annual Review 22 | 23

12

13

LEM Annual Review 22 | 23

Our fivebusinesses

We are working on innovative solutions
and increasing speed to market,
to capture opportunities in accelerating
markets driven by the electrificationof the world.

Our five businesses
Automation

INDUSTRIAL PRODUCTION

Automation sensors are used in industrial
manufacturing equipment such as toolingmachines, robotics, and conveyor belts
for production lines.
CONSUMER REL ATED

Energy savings are driving demand for sensors
in heating, ventilation, air conditioning(HVAC) products such as fans, coolers, andheat pumps.

The electronic sensor industry ischanging fast and being shaped bycontinuous technological breakthroughs
and new opportunities connectedto the electrification of the world.
The fundamental macroeconomic trends
behind this momentum are driving
change faster than ever before.
Heritage market, linked to industrial
manufacturing
Automation focuses on sensors for machine equipment that converts electrical energy into mechanicalenergy in a controlled way. As the core business is
motor drives for industrial manufacturing and for production lines, Automation is connected to the industrial investment cycle. Components shortages andsupply chain disruptions continued to prove challenging for global manufacturing.

Outlook
The Automation business depends largely on the
manufacturing investment cycle and is one of ourmore traditional businesses. This market will continue to grow in the years to come. Our ICS productfamily for small drives and robotics is fast becoming
well established in the marketplace.

HMSR
DA

GO

On the consumer side, the market for small and medium power applications including tooling machinesand heating, ventilation, air conditioning (HVAC)
products such as fans, coolers, and heat pumps isincreasing. Energy savings are a major climate-related
growth driver, and we anticipate continuous growthin this area.
A general slowdown might be on the horizon. While
this remains to be seen, we remain confident thatour product mix across a large variety of applications
and our diversified geographical footprint will allow
us to reduce the impact on our business.

Ventilation unit
(outdoor)

Financial performance
Full-year sales totaled CHF 136.3 million, an increaseof 4.6 %. At constant exchange rates, sales improvedby 8.2 % compared to full-year last year. The Q4 performance was CHF 33.7 million, 2.3 % better thanlast year.
We have seen strong demand for our products in
manufacturing equipment such as tooling machines,
robotics, and conveyor belts.
Extreme weather conditions caused by global climate change are driving demand for sensors going
into applications such as coolers and heat pumps for
consumer markets.

Moving manufacturing platform
with welding robots

HLSR

LEM Annual Review 22 | 23

16

Control unit
(internal)

HO

LKSR

HMSR

Our five businesses
Automotive

BATTERY MANAGEMENT

Highly accurate and reliable sensors provide all
the required information to improve the efficiency
and safety of the charging and discharging
process of the battery management system.
MOTOR CONTROL

Vigorous growth in all markets
Markets for battery electric and plug-in hybrid vehicles (EVs) were dynamic as demand increased rapidly while component shortages remained. Demand
was driven by new brands on the market, government subsidies and CO2 emissions targets, and increasing charging infrastructure. In response to
semiconductor and component shortages, ourteams worked closely and diligently with customers
and suppliers to maximize demand fulfillment andaccelerate the end-user EVs adoption rate.
Last year, demand for our products was strong, andcustomer order intake was high throughout the year,
especially during the first half. There were positive
signals across regions: China and Rest of Asia are
driving nicely and the US growing. Europe sufferedfrom exchange rates and allocations impact. We
faced strong supply chain constraints as well as pandemic setbacks in China in the first and fourth quarters. Despite this, we had vigorous growth in all markets.

There will be short and long-term
growth opportunities, as LEM offers
unparalleled experience in automotive
current sensing, with the largest
portfolio in the industry.

In 2022/23 we launched one new product for DC/
DC converters, four new products for motor control,
and two new products for battery management,
which will support further growth in Automotive.
Financial performance
The business showed impressive results for both Q4
and the full year, despite lockdowns and supply constraints. Full-year sales totaled CHF 100.7 million, an
increase of 17.4 %. At constant exchange rates, sales
improved by 19.0 % compared to full-year last year.
The Q4 performance was CHF 25.4 million, 9.1 % better than last year. Global fundamental demand for EVs
remained strong, and we delivered to most players
in the market.
Future trends
Fundamental transformation of the automotive industry towards electrification is unprecedented andwell underway. Electric and hybrid vehicles require ahigher number of current sensors than combustion
engine powertrains, spurring an exponential growth
for the demand of sensors. There will be short andlong-term growth opportunities, as LEM offers unparalleled experience in automotive current sensing,with the largest portfolio in the industry.

HMSR

Pressing the accelerator pedal sends a signal
to motor control to pull power from the batteries inorder to increase torque and speed. Reliable
sensors are integrated in the inverter module tomeasure current signals at very high speeds
to assure smooth, jerk-free acceleration.

DCDT

Electric traction motor
Electronics + inverter
DC/DC converter
Onboard charger

Internal combustion engine
Lead acid battery

HBCT

From a supply point of view, global semiconductor
players are investing significantly in capacity increases, which will gradually improve the supply and demand balance. Additional opportunities will appear inadjacent markets such as 2–3 wheelers. We expect
growth to continue.
The next aim of the automotive market will be to contribute to better efficiency in electricity management
globally. One way to achieve this ambition is to allow
energy flowing from vehicles back into the grid infrastructure and into electric powered tools. While suchvehicle-to-grid or vehicle-to-load systems still require solutions to technical challenges, this represents a new area of opportunity for LEM.

High-voltage battery

HC5FW

HSTDR

HC16

HAH3DRCAB SF 1500

LEM Annual Review 22 | 23

18

Our five businesses
Renewable Energy

SOL AR INVERTER

Every house with a photovoltaic system needs
an inverter to convert the solar DC electricity into
AC electricity.
LDSR measures AC and DC leakage currents intransformerless photovoltaic systems to ensure
the safety of people and installations. Primarily
used on the DC side of the inverter, HMSR SMS
measures AC and DC currents with high accuracy
and high immunity to external interference.
On the AC side, newly launched LWSR supports
a lower levelized cost of energy (LCOE).

Growing markets
Our Renewable Energy business has shown good
performance overall, the market is expected to continue growing for the upcoming years. The market isled by sensors for grid and hybrid solar applications.
Consolidation has taken place in Europe, and themarket has largely moved to Asia and especially China. We are well positioned in the market and workwith the big players.
Solar, wind, energy storage
While our first sales of sensors for industrial photovoltaics were in 1992, today there are new opportunities for the sale of current sensors in hybrid solar
inverters, as more and more photovoltaics are installed around the world. Similarly, our first sales of
sensors for wind turbines in Germany were in 1990,
we now sell products for highly complex wind park
projects often in offshore locations. There is increasing demand for commercial energy storage, withvery large systems to store energy in battery parks
used to provide flexibility for the electricity network.

With the expansion of giga-scalebattery facilities for energy storage
to offset power peaks anddrops in the grid, LEM will havenew opportunities for sales.

Financial performance
Sales increased only by 1.6 % to CHF 67.0 million.
This was mainly due to component shortages and astrong foreign exchange effect. Without the latter,
we would have grown by 6.3 %. In Q4 sales totaled
CHF 16.7 million, 1.4 % higher than Q4 last year. We
had good demand for our products, with China as
the major market for our solar products. With theglobal trend of decarbonization continuing, the prospects remain promising.

LDSR
0.3-NP

Outlook
We see new opportunities in consumer markets forsolar as people install more photovoltaics at homewith hybrid solar applications, which allow for temporary power storage in a battery. As a favorite clean
renewable energy, solar has the potential to significantly reduce carbon emissions produced by traditional energy and thus help mitigate catastrophic
global warming. Technological innovation will further
reduce the overall cost of photovoltaic systems andso boost the deployment along with our sales. With
the expansion of giga-scale battery facilities for energy storage to offset power peaks and drops in thegrid, LEM will have new opportunities for sales. We
expect the solid performance in Renewable Energy
to continue.

AC
DC

DC

AC

Solar inverter

HMSR
30-SMSLEM Annual Review 22 | 23

20

LWSR

Our five businesses
Energy Distribution andHigh Precision

DC FAST-CHARGING STATIONFOR ELECTRIC VEHICLES

DC fast chargers provide power to the car battery
directly and quickly, which is essential for
convenient long-distance driving and for fleets.
The AC/DC power module enables the conversion
from alternating current to a direct current.
Sensors ensure the control loop function, which
regulates the stability and power of power
modules.

Impressive growth in Energy Distribution
The Energy Distribution business has seen the strongest growth this past year. Applications for our sensors in this business can be grouped into three areas.
DC meter for fast-charging EV stations
We have had a major success with the roll-out of our
DCBM integrated DC meter for electric vehicle fastcharging stations. A seamless plug-and-play charging
experience and cost transparency is a must for mass
EV adoption, and the number of customers for our
DC Meter is continuously increasing.
As the leading supplier for such technology, LEM
developed this type of DC meter and earned certification. On top of our testing and calibration skills thatguarantee top quality products to our customers, wehave developed our own in-house expertise in metrology to comply with European and US regulatory
authorities. While the market for DC metering essentially started in 2021 in Germany, now other Europeanand American markets are adopting similar requirements.

A seamless plug-and-play charging
experience and cost transparency is amust for mass EV adoption, and thenumber of customers for our DC Meteris continuously increasing.

Power monitoring
Our well-known Rogowski coil sensors, which areused for measuring AC current in power lines, areexperiencing high demand related to improving gridreliability.
Sophisticated high-precision equipment
Our High Precision sensors are essential for manufacturing equipment and test benches, and for MRI
scanners, for which our products have been thestandard for decades. Our new product range of theIN family is adopted by more and more players in themarket.
Financial performance
Energy Distribution and High Precision sales increased
by 22.3 % to CHF 59.4 million year on year. Without theforeign exchange impact, we would have performed
27.6 % better than last year. The Q4-on-Q4 performance was also quite impressive, as it increased by
25.2 % to CHF 16.6 million.

DC meter

We gained many new customers signing orders for
products in EV charging stations and energy grid applications. Global investments in e-mobility infrastructure drive the strong performance of our DC
meter product, with Europe and the US contributing
to major growth.
Outlook
We expect continued healthy growth, although component shortages will remain for some time. We continue to invest in DC metering to offer our solutions
in new markets. With the CDSR device we are venturing into the market of AC wall boxes, where wehave existing customers and foresee to further extend our customer base. We will likely see growth
coming from grid technology providers deploying
our Rogowski coils in their AC grids. We are continuously improving our MRI sensors as the technology
advances.

LESR 25-NP

AC
DC
CDSR 0.07-TP

LEM Annual Review 22 | 23

22

Our five businesses
Track

TRACTIONLEM Traction sensors are used in converters toregulate speed and power of locomotives aswell as in auxiliary systems such as ventilation,lighting, etc. In addition, our products are used forenergy metering to make sure the electricity
use is precisely accounted for.
TRACKSIDE

Long-term market, slower growth
The first LEM products in the 1970s were sensors inlocomotives for trains, trams, and trolleys. Our traction business includes on-train sensors that control
and protect signals to power converters and inverters that regulate energy for air-conditioning, heating,lighting, electrical doors, or ventilators. Our trackside
sensors are for infrastructure along the rails such as
in substations, crossing gates, track circuits, control
and safety systems, signaling and point machines.
These minimize train service interruptions due toequipment breakdown and reduce lifecycle costs.
Fundamental long-term investments
Today, while growth is not as fast as that of new
trending areas, our legacy Track business continues
to show solid year-over-year growth. Electric trains
will continue to replace diesel trains, and many countries are investing in electrification of railroads, andmore public transport is required. These are fundamental long-term infrastructure investments by governments as well. LEM has major market share in thisbusiness.

Financial performanceWith a year-on-year growth of 0.4 %, sales remained
nearly flat at CHF 43.0 million. However, the foreignexchange impact was considerable. At constant currencies, Track would have grown by 5.7 %. In our lastquarter, the business grew by 3.1 % to CHF 11.6 million. With its project-based long investment horizons, Track remains stable. We saw extra demand
coming from the EU, which is renewing its energy
meters in various countries.

Privatization of rail networks means
new requirements such as monitoring tracks
to minimize service interruptions. Our new
HTRS family of sensors features DC and
AC measurement with the same performancein an ultra-compact, robust design.

TEMA 4G

Outlook
There are two fundamental changes taking placearound the word: transformation from diesel to electric locomotives, and an increase in electric public
transportation, such as tramways and trolleybuses.
Both require long-term government investment ininfrastructure, which takes time to secure, regulate,and implement. India and China are investing in rail
infrastructure, as are Germany and France. We expect the solid growth in Track to continue.

AC/DC

Energy metering for railroads
In Europe where railroads move across nationalboundaries often, our specially designed Energy meter for traction measure how much energy is used bywhom, and how much energy moves to the grid if a
train breaks.

With its project-based long investment
horizons, securing, regulating andimplementing applications for Tracktakes time.

LTC
SeriesLEM Annual Review 22 | 23

24

DV
Series

HTRS

t
r
e
a
r
u
s
q

h
e
a
w
d
e

Our new headquarters is an essential
part of our business transformation
and brings us forward to where we want
to be as a company.

NNew
headquarters

Frank Rehfeld (left picture), LEM Chief Executive
Officer, and Hannes Ehrensperger (right picture),
CCHE Associate, Architect HES, share theirperspectives on LEM’s new global headquarters
in Meyrin, Geneva.

What triggered your move to thisbrand-new location?
Frank Rehfeld (FR) This new headquarters is a milestone for us. Over many years LEM grew profitably tojust below 300 million in annual revenue, and werealized that to go over this threshold, we needed tomultiply volumes and go into new applications. Froma cultural point of view, LEM needed a new inspiration, a new behavior, a new ambition, and even a new
purpose. The idea of moving to a new building wasborn in 2018 when, after more than 30 years, ourrental contract at our former headquarters in Planles-Ouates, Geneva, was expiring. Our research led
us to HIAG Real Estate and to you, Hannes, at CCHE.
For me and the whole team, the move to this building
was breathtaking. In this light and transparent environment, the energy levels accelerated from dayone.

It is not spectacular, but it has
attitude and style. I think LEM canidentify with this unique building.
Hannes Ehrensperger

What are the key architectural featuresof the building?
Hannes Ehrensperger (HE) It is a pleasure to hearthis. For us the story began several years earlier with
Yves Perrin at HIAG Real Estate. We had the vision ofa human campus at this site, where technology andpeople could create together. Hewlett Packard was
our first partner. One day Yves Perrin said that hefound the company we were looking for. It was LEM.
In terms of architecture, this building is special. It is
the representative headquarters of LEM, where people arrive by taxi from the airport on one side of thebuilding. It is also an industrial research and prototyping center, where trucks deliver materials on theother side. Normally, people who work downstairs,
where the production lines are, would rarely come tothe upper floors to meet the Executive Management,
and the executives would only go down to visit fromtime to time. Here it is another world. Fitting everyone together and finding an expression for this new
way of working was an adventure. LEM had the idea
to make the canteen the heart of the building, aplace where all teams can mingle in the same space.
Everyone here feels they are working on something
together. This building is not only a place where people work, but also where the company is being represented to customers, suppliers, and other stakeholders. It is not spectacular, but it has attitude andstyle. I think LEM can identify with this unique building.
FR I agree. It was important to us to have a headquarters that fits our Swiss culture of under-promise andoverdeliver. You have been introducing inspirational
elements for our teams, with the spiral staircase for
instance, and very successfully created a special
feeling here with stone, steel, glass, and wood.
HE This staircase is truly unique. These are the first
100 % algorithmic stairs we have done for an officebuilding. I am proud of this. The complexity of thispiece had an influence on the process of production
and, in a way, represented the spirit of LEM: be afrontrunner for complex developments.

How does this building reflecttransformation at LEM?
FR This new headquarters is an essential part of ourbusiness transformation. We began changing ourorganization, from an industry-automotive set up toa regional organization with five business and overarching functions, at the same time as we moved
into this building. We needed a regional organization,
where headquarters is not taking all the decisions
but rather focuses on strategy and lets the regions
execute with more agility and speed than we could
do from the HQ. The state-of-the-art equipment here
is also an upgrade towards a more digital way of communicating and working.
Can you describe a few key phases of the project?
HE In the initial phase, all negotiations regarding ourconcept and arguments, price and timeline took
place between HIAG and LEM. Once LEM acceptedand signed the agreement, we had to obtain all building permissions and ensure we would not go overbudget. This meant working intensely with LEM, a
company we did not know well at the time and trusting them to make important decisions very quickly
on issues such as fire, security, and technical operations. When construction began, the pandemic hit.
At times I wondered if we would make it on time.
Geneva stopped all work on construction sites.
There were delays, but we handled it well. By the
final phase of construction, collaboration was excellent. With this complicity, we delivered the buildingon time.
What about sustainability?
HE We try to be highly advanced in terms of sustainability. Building elements have different lifecycles.
The structure has a cycle of 100 years, the façade 50
years, the technical elements from 30 to 50 years. In
this building, everything can be separated, and nothing is glued, except perhaps the carpet. Old elements can be removed easily in case things need to
be changed. We used the central heating system of
the campus to heat the building and we bought certified wood.

I think the spirit of innovation
can be felt when you enter ourheadquarters.
Frank Rehfeld

The connection between two cultures, business andproduction, is also seen in the connection between
the inside and the surroundings. The outside features and the landscape were an important part ofthis project. There are rooms below the garden, so
we designed the garden to let natural light in. I am
looking forward to seeing all the trees in bloom
again.
FR Our purpose at LEM is to accelerate the transformation of the world and our customers towards amore sustainable future. This building helps us do
this. We have reduced our CO2 emission by morethan 50 %, compared to our former offices. This issubstantial because we have given ourselves thetarget of net zero in all three Scopes by 2040.
How important was this move in yourstrategic development?
FR Everybody wants to attract and retain the best
people, but how? By providing them a work environment they enjoy. I think the spirit of innovation canbe felt when you enter our headquarters. This moves
us into a completely different league for attracting
more talented people, and for retaining people here
in the region. This light, this transparency, but also
the technology that we have installed – it is just fun
to be here. It is nice to see what this headquarters
evokes emotionally in people. My family was excitedwhen they saw the building. Perhaps not too many
people working at LEM for years, sometimes decades, expected that they would ever work in suchan environment. We are really making a statement.

FR Design for manufacturing is a relevant topic for us
as well. When you develop prototypes, you need tothink from the very beginning how to manufacture
them later.

LEM Annual Review 22 | 23

28

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LEM Annual Review 22 | 23

New
headquarters

It has now been slightly over a year since you moved
here. What has been the feedback so far? How
would you summarize your experience at HQ?
FR We proudly invite people here. We even haveschool classes visit to see the working environment.
We have seen improved energy levels in people here
and see communication increasing. People meetmore. Our HR department organizes many events inthe canteen. We do townhalls that can be broadcast
across the world via state-of-the-art equipment. This
headquarters brings us forward to where we want tobe, and we are radiating this image to the world.

Damien Pestel Maintenance Deputy Manager
These are beautiful workshops. Not just the machineryand equipment but also the windows that open onto
nature. However, I would like to underscore theimportance of the two lower floors for the company: theenergy and focus, the positive attitude and dedicationof everyone in production. What we do here is thefoundation for everything that takes place upstairs.

LEM Annual Review 22 | 2330

I am extremely happy with the road we have taken,
from the decision to move to this just-in-time delivery during the pandemic. This was a huge challenge,
but the result is overwhelming. Extremely well done.
Congratulations from the entire LEM team to you,Hannes, and your whole team.
By the way, this place is setting standards across thewhole organization. The new LEM headquarters wasinaugurated in the year of our 50th anniversary: We
gave this, so to say, as a present to ourselves for ouranniversary. A company with this track record deserved such a present. Many thanks for your ideas,
contributions, and guidance throughout the process.

Massimilliano Quaglia Group Functional Safety Manager
I really like the environment here. It feels calm.
The building is light and open to the outside. Today
I went for a run over lunch. This gives me energy.

Cecilia Albo Senior Accountant
The building is beautiful and clean, but its elevatedposition gives it a special feeling – like a citadel or theguardian of the area. The canteen is lively, with theterrace overlooking the Jura. I often go for a run withcolleagues on lovely trails through the vineyards.

Wen Liu Site Purchasing Manager
I would describe HQ as refreshing. It makes it easy towork openly and flexibly with people from different
cultures who have different opinions. I can react quickly
with other teams such as supply chain and production.
This HQ reflects how the leadership team is preparing for
big transformation at LEM – and a very positive future.

José-Manuel Mestre Rosa Facility Manager
It’s a challenge moving furnishings around every day,keeping everything in this new building functioning,and making sure my team is happy. We often needto find spontaneous solutions. I’ve been at LEM for over
30 years, so I’ve lived the transformation.

Marion Tibessart Head of Business Applications
I feel good vibes here. The clean design and purematerials are calm and relaxing. I started working
at LEM in this building, and it really fits the mindset ofthe company. Positive, modern, with the latest
technologies and IT – we are producing products
for the future here.

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LEM Annual Review 22 | 23

Our global R&D team focuses ondeveloping innovative solutions to
support our customers worldwide.
We are pleased to announce thelaunch of 9 products this past year.

Trends,
technology,
R&D
Megatrends drive long-term growth
Megatrends and their transformative global forces
continue to build a solid base for our future growth.
The future of mobility and infrastructure development, the future of energy as decarbonization anddigitalization, and the rise in industrial automation
trends are key drivers for business opportunities.

The increased demand for small sensors capable ofhandling high levels of power density led to theemergence of integrated current sensors (ICS) overthe last decade. They are the technology of choicefor our applications thanks to their ability to sense
relatively high currents using a very compact footprint.

Our strong heritage is in Track and Automation,
where we are market leader. We have significant
growth potential in Renewable Energy and High Precision. Our fastest growing sector in the mid andlong-term are Automotive and Energy Distribution.

Electrification of vehicles, new sensor applications
By 2028, 50 % of annual car production will employ
hybrid and electric powertrains. In addition, electricand hybrid vehicles require a higher number of current sensors than combustion powertrains, spurring
an exponential growth for the demand of sensors:from about 125 million current phases measured in
2020, LEM estimates that the market will grow morethan three times, to reach about 450 million in 2028.

Renewable energy systems, electric and hybrid vehicles, and sustainable technologies are important
growth drivers of the global current sensor market.
LEM has opportunities in electric powertrains, theminiaturization of components, and the deploymentof the Internet of Things with current sensors. Acrossour five businesses, we see the demand for improved communication capabilities, a deeper integration level, and an increased level of safety andsecurity resulting in additional sensor functionalities.
Technology trends
Higher power densities drive new current sensing
technologies
The more powerful the motor in a smaller component, the higher the power density. Thus, increasing
power density is a critical factor for increasing performance, as space constraints are present in virtually all our applications.
Two technologies, silicon carbide and gallium nitride,are enabling higher switching frequencies in power
density and thus a reduction in the size of inductors
and capacitors. We are investing significant time andenergy on evaluating, gaining access to, and mastering future sensor technologies.

On-board chargers, DC/DC converters, and DC chargers play a key role in energy distribution and management of hybrid and electric powertrains. Onboard chargers allow recharging the battery with an
AC socket at home or a charging station. DC/DC
converters transform high voltage from the battery
to a lower voltage for on-board applications such as
air conditioning and electric power steering. DC metering is becoming mandatory in the EU and the US
markets, as regulators want customers to pay only
for the power load of the battery of the vehicle, notpower line losses. Electrical safety is also becoming
increasingly important to protect customers in caseof charging station malfunction.
Ever higher voltage levels up to 800V make the battery system the heart of hybrid and electric powertrains. Accurate battery management systems havebecome increasingly important to ensure reliabledriving range information and that battery cells arewell maintained.
Stringent safety standards and autonomous driving
Automated driving functions are realized with interconnected systems using Automated Driving Assistance Systems (ADAS). These systems replace partof the driver’s usual decision making, keeping themand others safe from hazards. ADAS are implementing functional safety defined by the ISO 26262 standard. We are introducing this standard LEM sensors
in electrical vehicles powertrain systems.

LEM Annual Review 22 | 23

34

Smart grid, new market for current sensing solutions
Our energy system is undergoing radical transformation as millions of electric vehicles hit the road andterawatts of renewable energy capacity are installed.
While essential to decarbonize our energy system,
these changes create significant challenges. First,
the intermittent nature of wind and solar energy
force grid operators to provide flexibility in the system. Second, the rapid growth of Distributed Energy
Resources (DER) is decentralizing the distribution
network, increasing the complexity of operation. A
smarter grid is needed to reliably integrate intermittent renewable energies and DERs.
LEM provides best-in-class sensors and solutions
that measure electrical parameters along the network, allowing accurate monitoring, controlling, andautomation of the grid.
Ongoing R&D investments
We continue to invest to assure growth long term, with
R&D investments in 2022/23 of CHF 32.2 million, up
from CHF 29.4 million the year before. Several trends
prevail in driving our investments: the increasing
global demand for electromobility and the relatede-charging infrastructure; the need to measure energy flows in smart grids; requests from Automotive
customers for functional safety through third-party
assessments; and the overall demand for tailoredand highly customized solutions in high volume applications.
Our technology and product roadmaps reflect short-,
medium-, and long-term investments to underpin our
broad product portfolio. Our innovation team is conducting research activities and feasibility studies andprototyping rapidly. We are engaging with external
research and innovation partners to propel our technology pipeline for future product building blocks.
Product development teams in Geneva, Lyon, Sofia,
and Beijing are developing new products in close
cooperation with our customers in the regions.
This is leading us from a traditional, electromagnetic
sensors company to a broader business of various
integration levels. Examples are the HMSR and the
DC meter for charging stations. A deep understanding of integrated sensors in analog mixed signal
silicon platforms and highly miniaturized systems

Developing products for our fivebusinesses allows us to leveragesynergies and gives us the agility
to master the value creation
up to the full sensor and customer
application.

including their complex packages are fundamental
success factors for these types of products. The DC
meter features an ethernet interface and enables ahigh integration level into the customer product. Early customer involvement and the ability to quickly
provide prototypes for customer feedback were thedriving forces behind the successful market introduction of the DC meter.
Our broad engineering skillset led us to producefunctionally safe sensors to protect customer products and users from system and vehicle malfunction.
The demand for residual current detection associated with charging solutions is visibly taking off.
Our R&D team provides a diversified skillset, ingenuity, and particular design capabilities resulting from a
deep and extensive understanding of specific application demands. Developing products for our fivebusinesses allows us to leverage synergies to produce systems, modules, and highly integrated monolithic sensors. This gives us the agility to master thevalue creation from the sensor and sensor interface
IC design all the way up to the full sensor and customer application.
Our R&D teams
LEM engineering teams are located at five sites
worldwide today. The global presence of R&D enables us to be close to our customers and to benefit
from local talent to strategically grow our teams. Engineering growth in 2022/23 focused on ICS andsemiconductor expertise and software. We added
considerable analog design, IC-test development,
package and material engineering, application engineering and software algorithm capabilities in Geneva, Lyon, and Sofia.

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LEM Annual Review 22 | 23

Trends,
technology,
R&D

The R&D teams in both Geneva and Lyon focus onadvanced product and technology development,
ICS and software development. The main productfamilies cover drives for our five businesses, residual current detection at different integration levels, DC
metering, battery management, and highly integrated
field sensors.
In Sofia we develop Rogowski coils for smart grid
applications. Our portfolio has been expanded witha highly customized product, the ARH, a Rogowski
for high temperature applications. We started enhancing the embedded software capabilities in Sofia
to enable software enhanced module development.
Product development in Beijing focuses on Automotive, Renewable Energy, Track, and Automation. We
launched several open loop sensors for motor control and a flux gate battery management sensor, theCAB 1500, significantly increasing our portfolio ofcustomer specific Automotive applications. Several
ASIC projects continue to ensure supply during theongoing semiconductor shortage.
Our R&D team in Machida, Japan, supports our regional customer base with excellent application
knowledge especially in digital servo drives.
While teams in the different locations have theirunique application and technology focus, we areworking across locations by sharing our engineeringbusiness process, best practice, and our internaland external engineering training. We foster crosssite product development.
Technical focus and product launches
We are running product projects in battery management, ICS for Renewable Energy, smart infrastructure, drives and traction. New market needs are
emerging around electrical safety. Residual current
detection is becoming more and more prominent asa trend, driven and enforced by regulations and standards. Examples are the detection and monitoring ofcurrent overload in DC charging as well as in photovoltaic and data centers.

LEM Annual Review 22 | 2336

We conducted a process assessment to produce
the DC meter 600 Amp and certified it according to
the MID module D. This allows LEM to deliver DC meters at fast charging EV stations directly to our German customers and forego an additional interim certification step. Our teams continue to work on thelower cost, high volume 100 Amp DC meter.
Rogowski sensors are in strong demand in smart grid
applications. We updated existing traction products
via testing and validation to be compatible with new
standards, and in China we engineered new sensors
for trackside monitoring. Our efforts were recognized by the granting of 21 patents. Significant investments in technology and product development
over the recent years continue to produce the desired
results. In 2022/23 we launched 9 products.
OutlookIn 2023/24 we will focus our R&D investments along
the major growth trajectories. Resources and capabilities investments will be allocated, in particular, inthe following engineering domains: systems and application engineering, program management, software development, and test and validation engineering. Our ICS domain will be strategically grown toenhance system modelling and simulation support aswell as analog and digital IC design. A focused andbalanced competence level will accelerate criticalinnovation steps, enabling a broad and customized
product and solution portfolio.
The trend of increased sensor functionality anddeep integration leads to higher complexity of our
products. Compliance with Automotive SPICE, functional safety, and cybersecurity standards require anadequate development process maturity as well as
critical engineering capabilities, such as system engineering, and requirements management to deliverproducts effectively and reliably.
Embedded software is increasingly integrated into
LEM measurement systems including DC metering,battery monitoring, and residual current detection,requiring a balanced hardware and software resourcing of the product development teams. A strategic
technology platform approach will drive development efficiency and support time to market.

Product launches 2022/23
Product

Business

Application

HOF

Energy Distribution & High Precision

Robots/servo drives

HMSR DA

Energy Distribution & High Precision

Robots/servo drives

HAH2DR

Automotive

DC/DC converters

HAH6DR

Automotive

Motor control

HAH3DRS07

Automotive

Motor control

HSTDR

Automotive

Motor control

HC16F

Automotive

Motor control

CAB 1500-C

Automotive

Battery management

CAB SF 1500-C

Automotive

Battery management

HMSR DAThe HMSR DA is the first integrated current sensor on
the market with a sigma delta bitstream output. The digital
output can reach 11 to 13 bits of effective resolution.
Using the HMSR package, it provides 5.0kV isolation andcorrect measurement down to 4A nominal. The small
footprint, high integration, and flexible output makeit a convenient replacement for shunt solutions in servo
drives and robots.

HC16F
Another addition to the family of motor control current
sensors is the HC16F. This is a light and compact
single-phase current sensor designed to be mounted
SMD on a PCB, with an aperture to measure up to 1600 A
on carrying busbar. This sensor allows great flexibility
in terms of mechanical integration into the electricvehicle inverter.

HAH2DR / HAH6DR
The HAH2DR measures currents in bi-directional 400V
to 800V DC-DC boost converters in plug-in hybrid electricvehicles. Used in combination with HAH6DR, it measures
the three-phase current in the inverter driving the electricmotor and in a three-phase generator that recharges
the battery. These two products are good examples ofcustom-made products offering high level of integrationin highly constrained spaces.

CAB SF 1500-C
This is the third generation CAB series: CAB 1500
with an extended current range of up to ±1500A.
This ASIL (automotive safety integrity level) C device
complies with ISO26262 and enables redundant current
measurement using a single current sensor in the BMS.
CAB SF 1500-C delivers best-in-class accuracy andoffers extremely low offset, which enables accurate
coulomb counting for SoC estimations.

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LEM Annual Review 22 | 23

We are committed to maximizing
sustainable global growth bybuilding organizational ability
and a work environment
where diverse talents thrive.

Culture, talent& values

A strong sense of resolve
New headquarters, enhanced collaboration
We officially moved to our new headquarters in Meyrin, Geneva, in April 2022. The state-of-the-art building signals our agile, transparent, and collaborative
way of working. It brings together more than 250
employees with a rich variety of backgrounds andoffers a modern and sustainable working environment that empowers ingenuity and innovation. We
are convinced that the new location and its premises, known as The Hive, will inspire current and future
LEM people to fulfill their potential.
Our commitment to talent development
We are committed to maximizing sustainable global
growth by building organizational ability and a work
environment where diverse talents thrive. Last year,
we hired more than 150 new talents across theworld. Despite the need for new skills and competencies to fuel our growth, we remained committed
to providing opportunities for internal development.
One third of our manager/leadership positions andone fourth of our non-managerial positions havebeen filled internally.

Around the world, LEM people
showed resolve in dealing withchallenging situations by remaining
caring, strong, and positive.

We have digitalized and automatized our global onboarding program, ensuring that each new employee
has access to the necessary information and knowledge to be successful in their new role. Since July
2022, all employees have unlimited access to a global online learning platform that allows them to learn
hard and soft skills critical to their development andto LEM’s success. In 2022, 71 % of our employees
were actively studying on the platform. On average,
they have had more than six hours of training, whichin total represents more than 440 days of training.
Employer of choice
At LEM, we are a global and human-sized company
with a collaborative culture. Our caring and empowering work culture fosters ingenuity, which is essential for achieving our purpose: helping our customers
and society transition to a more sustainable future.
Every two years, we ask all employees for their opinion on the progress we are making towards becoming employer of choice in our industry. In 2022, theyanswered more than 90 questions to help us understand where and how we can act on a global andlocal level to improve engagement. We are pleased
to report that our Global Engagement Index improvedby 2 percentage points compared to 2020, placing
us 5 points above the global average benchmark
provided by our engagement survey partner. Progress is particularly significant in areas such as innovation (+3 points), collaboration (+3 points), managerial behaviors (+3 points), and professional
development (+3 points). Our dedication to improve
our ways of working and our work environment also
showed in the reduction of voluntary turnover from
10 % in 2021 to less than 7 % in 2022.

A challenging year
In 2022, all of us have had to continue to adjust to
the extraordinary consequences of the COVID-19
pandemic and geopolitical instability. This was especially true in China where our teams faced multiple
lockdowns and supply chains issues. We are very
proud of the solidarity and caring spirit showed byour colleagues in China and across the globe during
the Shanghai lockdown. This helped them getthrough difficult times.
Around the world, LEM people showed resolve indealing with challenging situations by remaining caring, strong, and positive. We donated to the Swiss
Red Cross in support of Ukrainian refugees. We continued to support our employees following our decision to cease all operations in Russia in April 2022.
After the devastating earthquake which struck last
February, we extended assistance and support tothose in need in Turkey and Syria. A total of 90 beds,
100 sets of blankets, sheets, and pillows were collected and shipped.
Our way of working – LEM Blue Behaviors
The LEM team is made up of experts, talent, and caring leaders working tirelessly to bring customers thebest solutions. Our way of working closely with ourcustomers and all our stakeholders differentiates us
from the competition and helps us achieve our ambitious business objectives and deliver on our purpose.
– Innovation and continuous improvement
mindset– Customer orientation and growth mindset– Team player mindset– Player/learner mindset
Specific behaviors for each point have been identified and integrated into individual development
plans, performance assessment systems, and talentacquisition processes. All employees, whatever theirfunction or seniority, should aspire to embrace andenact these LEM Blue Behaviors. It is clear that a constructive culture not only helps employees achieve
their full potential and enjoy their experiences, butalso attracts the right caliber of new talent to ensure
LEM achieves its strategic goals.

LEM Annual Review 22 | 23

40

Diversity and inclusion
As LEM adapts its organizational structure to meetthe demands of its customers and seize the growth
opportunities of the various megatrends, there is aneed to diversify our talent base across different regions, product applications, technologies, and support functions. Recognizing that diversity and an
inclusive organizational culture brings many benefits. LEM is committed to ensuring that its talent acquisition and development strategies are as broadbased as possible.
LEM provides equal opportunity to all qualified individuals. 54 % of the overall workforce is female. Given the historically high share of engineering positions in product development, sales & marketing,and management, the share of female employees in
non-production positions is 30 %. We actively seek
female candidates in higher qualification positions,and there has been significant progress in markets
such as China where many engineering graduates
are women. Several global responsibilities such as
R&D, supply chain, business transformation, global
talent management, and communications are headed
by female employees. LEM has key female managers
in China (Finance, Purchasing, Quality, and Supply
Chain) and in Bulgaria (General Manager, Purchasing,
Human Resources).

Employee analysis
31.3.2023

31.3.2022

Permanent employees

1’488

1’350

Temporary employees

215

201

Trainees

13

24

1’716

1’575

Women in overall workforce		

54 %

54 %

Women in non-production related activities

32 %

29 %

Women in management positions

22 %

22 %

FTE

Total

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LEM Annual Review 22 | 23

Culture, talent& values

Executive Committee

Workforce by activity

Average length of service

1’716 total employees

1’488 permanent employees

12
10.2

13 %

10
7.6

8

6.6

14 %
6

5.7

4

9%

2
64 %
0
Years

Operations

R&D

Operations

R&D

Admin and logistics

Sales and marketing

Admin and logistics

Sales and marketing

New Executive Committee members
This year was transformative from a corporate governance point of view. We successfully completed theextension of our Executive Committee with newmembers.

With diverse nationalities and cultures, experienceand expertise, this team is well prepared to lead theorganization and to achieve our ambitions in a collaborative spirit.

In line with our new regional and functional matrix, inplace since April 2022, we appointed a Senior Vice
President Asia, John McLuskie, who is based in
Shanghai. We also appointed a Chief Technology Officer, Dr. Verena Vescoli, who leads our efforts in
R&D, and a Senior Vice President Operations, Uwe
Gerber. Finally, Bastien Musy, who was Vice President Product Management, has been promoted to
Senior Vice President Europe and Americas.

From left to right: Andrea Borla Chief Financial Officer, Bastien Musy Senior Vice President Europe and Americas,
Uwe Gerber Senior Vice President Operations, Frank Rehfeld Chief Executive Officer, Verena Vescoli Chief Technology Officer,
Rodolphe Boschet Chief Human Resources Officer, John McLuskie Senior Vice President Asia

LEM Annual Review 22 | 23

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LEM Annual Review 22 | 23

Our values andbehaviors

Board of Directors

Our values Our core values are the beliefs we share – and the spirit and intent of everything we do:

We are customer driven
All our activities are driven
by the desire to provide best
quality service.

We commit
We set our goals high andtake responsibility for all our
actions.

We operate with integrity
Our relationships with co-workers,
customers, suppliers, partners
and the investor community arebased on openness and fairness.

We strive for excellence
No matter how good our
products, services, process
and results, we are dedicatedto making them better.

We value teamwork
Teamwork is more than justworking together, it is bringing out
the best of everyone’s strengths

We lead innovation
By thinking out of thebox, we adapt to tomorrow’s
requirements.

LEM Blue Behaviors The LEM team is made of the expertise, talent, and leadership working relentlessly
to bring customers the best solutions. We have identified four groups of LEM Blue Behaviors which
all employees should aspire to embrace and enact, whatever their function or seniority:

1

Innovation and continuous 		
improvement mindset

3Team player
mindset2

Customer orientationand growth mindset

4

Player/learnermindsetFrom left to right: Ilan Cohen Member of the Board of Directors, François Gabella Member of the Board of Directors,
Member of the Strategy Committee, Andreas Hürlimann Chairman of the Board of Directors, Chairman of the Strategy Committee,
Member of the Nomination and Compensation Committee, Werner C. Weber Member of the Board of Directors, Member of theStrategy Committee, Ueli Wampfler Member of the Board of Directors, Chairman of the Audit and Risk Committee,
Ulrich J. Looser Member of the Board of Directors, Compensation Committee, Member of the Audit and Risk Committee

LEM Annual Review 22 | 23

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LEM Annual Review 22 | 23

Responsibility

We continually develop our internal
capabilities and sustainability
initiatives, and we report transparently
on our progress.

Responsibility

We believe that sustainable and ethicalpractices create long-term value for all
key stakeholders in society, assure
longevity of businesses, lead to smart
solutions, and inspire us and others to do
better. Our success stems from operatingand evolving within a clear value system,
following best practice principles andstandards, together with the closemonitoring of Environmental, Social andGovernance (ESG) Key Performance
Indicators (KPIs).
LEM Code of Conduct
The LEM Code of Conduct (CoC) is the cornerstoneof our company’s responsibility to society. It reflects
the United Nations Global Compact (UNGC) principles, global environmental standards, and our core
corporate values. It is a binding document for employees and business partners, such as suppliers.
Every LEM employee receives and signs it.

For each new product, we develop
an environmental profile before launch,which includes recyclability rate andmaterial saving compared to previous
or equivalent models.

United Nations Global Compact
Since 2006 we adhere to the Ten Principles of the
UNGC, which are driving global action to achieve the17 Sustainable Development Goals (SDGs) by 2030.
These principles, which relate to human rights, labor,
environment, and anticorruption, are embedded inevery aspect of LEM, from our strategy to our actions. As we do every year, we provided an update to
the United Nations through our Communication on
Progress (CoP), available on the LEM and UNGC
websites.
In 2023, LEM is pleased to take part in the “SDG Innovation Accelerator for Young Professionals”, an
initiative helping participating UNGC companies
learn how to use the 17 SDGs in designing more sustainable business models and products. As part ofthis nine-month program, four LEM employees areworking as a team, on a voluntary basis, to come up
with creative solutions for several sustainable development challenges that our company is facing.
Out of the 17 Sustainable Development Goals (SDGs)
from the 2030 Agenda for Sustainable Development,
we have identified four SDGs on which we are focusing through concrete initiatives and projects: Affordable and Clean Energy (Goal 7); Industry, Innovation
and Infrastructure (Goal 9); Responsible Consumption and Production (Goal 12); and Climate Action(Goal 13).
Environmental standards
The trends to sustainable energy sources and electromobility are two of LEM’s key growth drivers. Our
accurate sensing solutions give our customers acompetitive edge in energy management solutions.
For example, LEM sensors’ high accuracy directly
impacts the battery pack size of a battery electric orplug-in hybrid vehicle, reducing car weight and energy consumption. Our products are also found inother green energy applications such as solar panels
and wind turbines.

All our main production sites are ISO 14001:2015 certified, an environmental certification which we renew
regularly. Our production activities are compliant with
the European Regulation for Registration, Evaluation,
Authorization and Restriction of Chemicals (REACH)
and the Restriction of Hazardous Substances(RoHS). We regularly publish updates to its standards and reporting on our website. All LEM manufacturing sites apply waste sorting and treatment
solutions. For each new product, we develop an
environmental profile before launch, which includes
recyclability rate and material saving compared toprevious or equivalent models.
Assessments by third-party organizations
We attach great importance to external assessmentsof our Corporate Social Responsibility (CSR) performance. For the second year in a row, we chose to beassessed by EcoVadis, which provides us guidelines
to grow and evolve by highlighting our strengths but
also targeting specific areas for improvement.
EcoVadis
EcoVadis assesses how well a company has integrated the principles of sustainability and CSR into its
business and management system. EcoVadis attributed us an overall score on our sustainability
achievements based on an extensive questionnairethat was completed by our teams in the fields of
Quality & Environment, Corporate Risk, Legal, Purchasing, Supply Chain, and Human Resources. Our
employees had to provide factual evidence whenanswering the EcoVadis questionnaire, which wasthen reviewed to attribute an objective assessmentof our sustainability performance. For 2022/23, ourefforts in the field of environment have been particularly underlined and our score regarding sustainableprocurement improved. Our scores in the fields oflabor & human rights and ethics went slightly down
partly due to a lack of detail in our labor, human rights,
and ethics policies, which we are currently updating.

ESG metrics
We recognize the importance of keeping score of
our ESG performance. Our ambition is to continuallydevelop our internal capabilities and sustainability
initiatives, and to report transparently on our progress. Last year, we took the decision to align our ESG
reporting to the globally recognized and standardized NASDAQ ESG Reporting Guide 2.0. to report on
selected and meaningful ESG KPIs. In line with new
regulations on non-financial reporting in force in
Switzerland since 1 January 2022, we will produce a
separate sustainability report starting next year.
Moreover, to reinforce LEM’s commitment towards
the three dimensions of ESG, our Executive Committee has decided to directly oversee climate-relatedrisks from 1 April 2023 onwards.
Environmental
We measure our environmental footprint with several
KPIs: the emissions of greenhouse gas (GhG), in CO2
equivalents, across all three Scopes (1, 2, and 3), thetotal GhG emissions per output scaling factor 1, thetotal direct energy usage per output scaling factor 2,
continuous compliance with ISO 14001, and the direct involvement of our senior management team inclimate-related matters.
As part of the CO2 strategy in place at LEM since lastyear, we recalculated our CO2 emissions in 2022. In
2022, we emitted 39 tons of CO2 in Scope 1, 4’066
tons in Scope 2 and 100’454 tons in Scope 3. Thismeans that, compared to last year, we reduced ourCO2 footprint by 37 tons in Scope 1 and 2 and increased it by 6’496 tons in Scope 3. The total net
increase is 6’459 tons of CO2 compared to 2021. 3

1 The total direct energy usage per output scaling factor (E4.1) is calculated by dividing the annual energy consumption by the number of FTEs
2 The total GhG emissions per output scaling factor (E2.1) is calculated by dividing the annual emissions by the revenue
3 Inaccurate figures were communicated with regards to our CO2 footprint last year. Figures put forward were 245 tons in Scope 1, 4’042 tons in Scope 2
and 163’610 tons in Scope 3. After careful analysis, we can affirm that the effective footprint of LEM in 2021 was 43 tons in Scope 1, 4’099 tons in Scope 2
and 93’958 tons in Scope 3

LEM Annual Review 22 | 23

48

49

LEM Annual Review 22 | 23

Responsibility

Our ambition is to continually develop
our internal capabilities andsustainability initiatives, and to reporttransparently on our progress.
The decrease in Scope 1 can be explained by therenewal of our car fleet in China from conventional tobattery electric vehicles, while the decrease in
Scope 2 can be explained by our site in Bulgaria
switching to the purchase of green energy. These
reductions are in line with our ambition to be CO2
neutral (net zero) in Scope 1 and 2 by 2025. To makethis a reality, we have a clear plan in which transitioning to fully green energy for our own electricity consumption plays a crucial part. The increase compared to last year for Scope 3 can partly be explainedby a sharp rise of CO2 emissions due to the ongoing
conflict in Ukraine and its geopolitical consequences. Avoiding Ukrainian and Russian airspace, airfreight flight routes between China and Europe are
longer. On top of that, Scope 3 emissions increased
due to a rise in purchased components to meet thegrowing demand from our customers. Scope 3 still
represents by far the biggest source of our emissions, with around 96 % of the total. We are confident that by closely cooperating with all partners
along our supply chains, as well as making use of
train and sea freight for outbound transportation, we
can become net zero by 2040.
In 2022, the total of GhG emissions per output scaling factor went slightly down from 262.7 to 259.8
gCO2/CHF. This can be explained by a turnover increase that was greater than the CO2 emissions increase. Regarding total direct energy usage per output scaling factor, we have seen a significant
improvement since last year, declining from 5’599
kWh/FTE in 2021 to 4’471 kWh/FTE in 2022, which
underlines efficiency gains by energy savings at our
new sustainable headquarters in Meyrin, Geneva,
and replacement of energy-intensive machines atour site in Sofia, Bulgaria.

LEM Annual Review 22 | 23

50

Our four main production sites adhere to the ISO
14001 standard, and we ensure that all new suppliersof direct materials also have a valid certification.
Social
It is our duty to make sure that all our activities respect human rights. Additionally, we strive to fostera culture that encourages professional development,
equal and fair treatment, and that nourishes and empowers every individual. We want to be a company
where our employees can feel safe to be creative,
innovative, and thrive with their personal talents.
We make sure that our employees are not subject todiscrimination based on characteristics other thaninherent factors required for the job. The total enterprise headcount shows that there are more womenthan men working for LEM globally, and that thistrend slightly increased between 2021 and 2022.
Our CoC – which also covers suppliers and vendors– stipulates strict policies protecting human rights,
condemning sexual harassment, discrimination, andchild and forced labor.
Governance
We place ethics at the heart of our corporate practices. As such, we want our employees to act basedon our CoC to make sure that our values are wellunderstood across all sites, cultures, and positions.
Employees sign the CoC upon arrival, and we requirethem to take an online training. In 2022, 99.8 % of
our employees worldwide have signed the CoC.

ESG Key Performance Indicators *Environmental (E)

2018

2019

2020

2021

2022

E1.1

GhG emissions

Total amount (in tons) in CO2 equivalents
for Scope 1

N/A

N/A

N/A

43

39

E1.2

GhG emissions

Total amount (in tons) in CO2 equivalents
for Scope 2

N/A

N/A

N/A

4’099

4’066

E1.3

GhG emissions

Total amount (in tons) in CO2 equivalents
for Scope 3

N/A

N/A

N/A

93’958100’454

E2.1

Emissions intensity

Total GhG emissions per output scaling factor(gCO2/CHF) **

N/A

N/A

N/A

262.7

259.8

E4.1

Energy intensity

Total direct energy usage per output scaling
factor (kWh/FTE) **

N/A

N/A

N/A

5’599

4’471

E7.1

Environmental operations

Does your company follow a formal
environmental policy? Yes, No

Yes

Yes

Yes

Yes

Yes

E9.1

Climate oversight/
management

Does your senior management team oversee
and/or manage climate-related risks? Yes/No

N/A

N/A

N/A

Yes

Yes

2018

2019

2020

2021

2022

Social (S)S4.1

Gender diversity

Percentage: Total enterprise headcount held
by women

N/A

N/A

N/A

52.6%

54.0%

S6.1

Nondiscrimination

Does your company follow a sexual harassment
and/or nondiscrimination policy? Yes/No

Yes

Yes

Yes

Yes

Yes

S9.1

Child and forced labor

Does your company follow a child and/or
forced labor policy? Yes/No

Yes

Yes

Yes

Yes

Yes

S9.2

Child and forced labor

Does your child and/or forced labor policy also
cover suppliers and vendors? Yes/No

Yes

Yes

Yes

Yes

Yes

S10.1 Human rights

Does your company follow a humanrights policy? Yes/No

Yes

Yes

Yes

Yes

Yes

S10.2 Human rights

Does your human rights policy also coversuppliers and vendors? Yes/No

Yes

Yes

Yes

Yes

Yes

2018

2019

2020

2021

2022

Corporate governance (G)G6.1

Ethics and anticorruption

Does your company follow an ethics and/or
anticorruption policy? Yes/No

Yes

Yes

Yes

Yes

Yes

G6.2

Ethics and anticorruption

If yes, what percentage of your workforce has
formally certified its compliance with the policy?

96%

97%

97%

98%

99.8%

* Aligned with NASDAQ ESG Reporting Guide 2.0** Adjusted scaling factor

51

LEM Annual Review 22 | 23

Information for investors

ContactAndrea Borla (CFO)
Phone: +41 22 706 12 50
E-mail: investor@lem.com

Number of registered shareholders
31.3.2023

31.3.2022

1 – 499

1’422

1’297

500 – 4’999

63

58

5’000 – 49’999

8650’000 and more

3

3

1’496

1’364

Total

Share price development LEM HOLDING SA (LEHN)
compared to SPI
in CHFLEM share price (+334 %)SPI Index rebased (+201 %)

3000
2500

Shareholders by category
31.3.2023

31.3.2022

Institutional shareholders

45.2

44.6

Private individuals

25.8

25.5

LEM employees, managers, and Board

6.9

6.8

in %

Treasury shares

0.0

0.0

Nonregistered shares

22.1

23.1

Total

100.0

100.0

Share information

2000
1500
1000
500

0

Symbol

LEHN

Listing

SIX Swiss Exchange

Nominal value

CHF 0.50

ISIN

CH0022427626

Swiss Security Number (Valor)

2 242 762

31.3.1331.3.1431.3.15

31.3.16

31.3.1731.3.18

31.3.19

31.3.20

31.3.2131.3.2231.3.23

Source: Bloomberg

LEM share
2022/232021/22

1’140’000

1’140’000

2’440

2’690

Financial calendar
1 April 2023 to 31 March 2024

In number of shares, CHF

Number of sharesYear high 1
Year low 1

1’364

1’610

Year-end 1

1’966

2’240

Average daily trading ­volume (shares) 1
Earnings per share
Ordinary dividend per share 2
Market capitalization as per March 31 1 (in CHF millions)
1 Source: SIX
2 Proposal of the Board of Directors to the Annual General Meeting of Shareholders 2023

LEM Annual Review 22 | 23

52

540

587

66.12

63.48

52

50

2’241

2’554

29 June, 2023
4 July, 2023
6 July, 2023
27 July, 2023
10 November, 2023
2 February, 2024
28 May, 2024
27 June, 2024
2 July, 2024
4 July, 2024

Annual General Meeting for the financial year 2022/23
Dividend ex-date
Dividend payment date
First quarter results 2023/24
Half year results 2023/24
9 months results 2023/24
Full year results 2023/24
Annual General Meeting for the financial year 2023/24
Dividend ex-date
Dividend payment date

53

LEM Annual Review 22 | 23

Leading the world in electricalmeasurement, LEM engineers
the best solutions for energy
and mobility, ensuring that ourcustomers’ systems are
optimized, reliable, and safe.

Copyright© LEM HOLDING SA,
GenevaConcept and text
LEM HOLDING SA, Geneva
Eleanor Close Kraft, Zumikon
Cabinet Privé de Conseils SA,
GenevaProcess AG, Zurich

DesignProcess AG, Zurich

PhotosMara Truog, Zurich
Xiao Nan, Beijing
Sacha Di Poi, Morges
Maud Guye-Vuilleme, Morges

Printing
Druckprodukt, Zurich

Annual Review
22 | 23

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