Contents

4

Welcome8

Leading the world10

Financial results

14

Industry segment performance20

E-mobility infrastructure

26

Automotive segment performance

32

Trends, technology, R&D

38

Culture, talent & values		— Conversation with ExCo members

		— Stories of resilience & agility		— Behaviors & values

52

Board of Directors

53

Responsibility

56

Information for investors

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

Welcome

For all of us around the world, thispast year has been immensely
challenging both professionally andpersonally. The COVID-19 pandemic
has put huge strains on public healthsystems, government finances,diverse economic sectors, educationand societal norms and behaviors.
Today in May 2021 we can happily
identify some positive trends thanks
to the rapid deployment of new
vaccines, the adoption of new technologies, the support of government
programs and the sheer adaptabilityof humanity to such challenges.
At LEM we have come throughthis pandemic in better shape thanwe could have foreseen thankslargely to the engagement of ouremployees, and the long-standing
relationships with our customers
and suppliers.

Indeed, the past year has underlined some fundamental strengths of our company: the diversity of ourbusiness across sectors and regions, with balancing
investment cycles and customer demand, and exposure to both mature industries and novel technologies. Thanks to our recognized heritage and market
leadership, even in this exceptional year, we maintained a steady flow of orders, robust margins, astrong balance sheet and healthy cash flow. Moreover, LEM’s long-term prospects are driven by mega
trends such as energy efficiency, CO2 neutrality, mobility and automation, all of which remain paramountfor society’s progress beyond the pandemic.
Resilience and agility
The theme of this year’s Annual Review is “Resilienceand Agility”. The first quality is the ability of an organization, system or person to adjust to and respondreadily to adversity – which our teams demonstrated
amply by continuing to meet customer and supplierchallenges, showing huge commitment in difficult circumstances. Resilience is also perseverance – andLEM kept clearly focused on its strategic priorities
despite the disruptions to everyday operations. The
attribute of agility is the power of moving swiftly andeasily, thinking and drawing conclusions quickly – andour teams showed this by working smarter, adapting
to new ways of remote collaboration, and identifying
new processes which will benefit us and our customers for the future.
We are pleased to share with you the experiences
during the pandemic of six LEM team members acrossdifferent regions and functions – wonderful examples
of stamina and flexibility. And there is an insightful
conversation with the two newest members of our
Executive Committee as they recount their reasonsfor joining the company, their experiences of the past
year, and plans for success.
Culture & talent for growth
Far from being mature, the current sensor market isforecast to grow by about 8% CAGR. Products areundergoing significant evolutions, driven by new applications and technologies. To ensure we capture
and manage this global growth we are making the organization more agile, with decentralized decision
making closer to the customer and increased speed
to market. We are developing and recruiting the best

LEM Annual Review 20 | 21

4

global talent with new competencies to deliver thisgrowth potential. As market leader in several applications of electrical measurement, our employees enjoy
intellectual challenges, diverse pathways and global
career opportunities. The company is committed toensuring that its talent acquisition and development
strategies are as broad-based as possible, recognizing that diversity and inclusion brings many benefits.
We are proud that 36% of management positions areheld by women and are committed to raising this proportion.

Robust results
Our financial results demonstrate even in these unprecedented times that LEM’s business is resilient,and we were able to quickly adjust our operations andexpenditures. Sales in the financial year 2020/21 totaled CHF 301.0 million, a slight decline of 2.3%, but
up 0.4% at constant exchange rates. EBIT increased
to CHF 60.9 million from CHF 58.3 million, yielding an
improved EBIT margin of 20.2%. We posted a net
profit of CHF 55.6 million, with an encouraging net
profit margin of 18.5%.

In 2019 LEM began its program to continually develop
a constructive High-Performance Culture which underpins how we all think, behave and communicate
personally and collectively. Over the past year, wehave identified four groups of key “LEM Blue Behaviors” which all employees should aspire to embraceand enact, whatever their function or seniority.

Our balance sheet is strong and we continue to generate healthy cash flow. For the year 2020/21, theBoard of Directors proposes an increased dividend of
CHF 42 per share, taking into consideration the company’s robust performance this year and its financial
strength.

Successful new product launches from R&D
investments
For the second consecutive year we launched ten
new products. These are strong evidence of successfrom our strategic R&D investment rate of about 9%of sales over the past few years. Indeed, customer
demand has been exceptional for two products: theDC meter for charging stations for electric vehicles,
and the HMSR integrated current sensor for bothdrives and solar power.
In Geneva and Lyon we are focused on long term research and innovation around new applications, while
in Beijing and Sofia new products are developed forspecific customers and applications. This is leading
us from a traditional, electromagnetic sensors company into a broadened business of various integrationlevels, still centered around sensing. It is to our advantage that we produce for customers in the industry
and automotive segments, which allows us to leverage synergies to produce larger systems, modules
and semiconductors. We continue to invest in newtechnologies and talents which provide the agility tomaster the value chain from the design function to thefull sensor and customer application.

Strategic focus
Mega trends drive demand for sensors, give multiple
opportunities to leverage LEM expertise and ensure asustainable long-term business for all our stakeholders. Despite the turbulence caused by the pandemic,
we remained focused on our strategic priorities andwere persistent in execution to the highest standards.
We are strengthening our technology leadership, delivering new solutions for customers, improving ourquality systems and operational excellence, investingin and broadening our talent capabilities, and buildinga High-Performance Culture. In short, we are making
sure that LEM is fully able to move swiftly and exploit
the growth opportunities we see across multiple sectors and regions. Although there have been delays
due to the pandemic, we hope to make significant
progress with the new production plant in Malaysia inthe coming year, and look forward to moving into our
new headquarters in Geneva in 2022.

5

LEM Annual Review 20 | 21

Welcome

Looking ahead, we believe that our business has
adapted well and coped with the challenges of thepandemic, but COVID-19 will undoubtedly continue toimpact our customers and our business in the coming
year. There are also headwinds caused by supply
chain shortages and ongoing trade disputes. We do
benefit from a diverse global footprint, but like manybusinesses today our progress is strongly linked to
the growing markets in Asia. It is pertinent to note thatwhile much of the world’s attention has rightly been
focused on dealing with the pandemic, there remain
the underlying challenges of climate change, and thisis a key area where LEM is making its mark.
Thank you
On behalf of the entire Board of Directors and the Executive Management, we thank our shareholders forthe confidence they have placed in us. Special thanks
go to our employees worldwide for their outstanding
commitment and responsiveness in managing the exceptional challenges of the past year. Our performance is also the result of the deep and trusted relationships we have developed over years withcustomers, suppliers and business partners. We areproud that we continued to meet their needs, andcould also bring to market several new products
which have been so well received. We hope you enjoy this Annual Review and will appreciate the evidence of LEM’s “Resilience and Agility”, as we focus
on supporting society’s transition to a sustainable
future.

Andreas Hürlimann
Chairman of the Board of Directors

life

There is no doubt that over the past year,
life as we had known it at LEM was disrupted
by the pandemic. Many of us were affected
personally by the virus, and all of us
had to adjust to new ways of working.
Our resilience was proven many times over.
And we appreciated more than ever thehuman understanding and trust among
our teams, customers and suppliers.

energyWe established virtual communication
immediately, becoming more efficient andtransparent. Around the world, LEM teams
came together to ensure that our business
partners’ needs were met rapidly. We
launched new smart solutions to optimize
our customers’ systems and continued
to invest for the future.

motionThe extraordinary circumstances allowed us
to identify future business opportunities.
We used the challenges of COVID-19 to worksmarter, adopt new ways of thinking andact quickly. This has set new processes into
motion, many of which will benefit our stakeholders and the company for years ahead.

Frank Rehfeld
Chief Executive Officer

LEM Annual Review 20 | 21

6

7

LEM Annual Review 20 | 21

Customization

Production

R&D

Sales

Leading the world inelectrical measurement
EuropeGeneva, Switzerland
Frankfurt, Germany
Vienna, Austria
Brussels, Belgium
Randers, Denmark
Paris, France
Padova, Italy
Skelmersdale, UK
Lyon, France
Sofia, Bulgaria
China
BeijingShanghai
Shenzhen
Xian
Hefei
Taipei, Taiwan
North America
Milwaukee, Wisconsin
Columbus, Ohio
Amherst, Massachusetts
Los Angeles, California

LEM headquarters
Geneva, Switzerland

Rest of world
Pune, India
Seoul, South Korea
Tokyo, Japan
Tver, Russia
Agents/Distributors

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 20 | 21

8

Our 1,500 people in over 15 countries
transform technology potential into
powerful answers. We develop and recruit
the best global talent, working at
the forefront of mega trends such as
renewable energy, mobility, automationand digitization.

With innovative electrical solutions,
we are helping our customers andsociety accelerate the transition toa sustainable future.

9

LEM Annual Review 20 | 21

Financial results

Resilient financial performance
Sales in the financial year 2020/21 totaled CHF 301.0
million, a decrease of 2.3% compared with the previous year. However, our constant currency sales
growth was +0.4%, with the Automotive segment
accounting for most of this positive like-for-likegrowth. Overall, this was a resilient performance inthe context of the COVID-19 pandemic and global
economic slowdown. It is testament to how ourteams responded to the challenges, to our customers’ appreciation for our products, and our reliability
as a partner.
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. China
became even more important this year with 38% of
total sales (32% in 2019/20), Europe 30% (32%),
North America 10% (12%) and the rest of the world
22% (24%). Sales increased notably in China(+14.6%), driven mainly by demand for solar powerand electric vehicles (EV), while all other regions witnessed a decline in sales as they took longer to adjust to the pandemic: Europe (-7.1%), North America(-18.6%), rest of the world (-10.1%).

Our sales performance attests tothe breadth of our product portfolio,
our reliability as a partner and how
we responded to the challenges
of COVID-19.

During the financial year 2020/21, orders were up by
12.3% at CHF 362.0 million compared with CHF
322.4 million, reflecting solid demand in the Industry
segment (+5.3%) while the Automotive segment(+38.2%) was boosted by the continued switch toEVs. The full year book-to-bill ratio reached 1.20, up
from 1.05.
Gross profit was down slightly by 1.5% at CHF 140.6
million, while the gross margin improved again to46.7%. This is 30 basis points better than in the prior year, with increased supply chain costs offset by
improved purchasing efficiencies and other improvement programs.
We remain vigilant with overheads, and managed
to reduce total SG&A costs by CHF 3.9 million to
CHF 52.6 million, or 17.5% of sales compared with
18.3% last year. This decrease reflects reduced marketing and travel expenses and changes in working
practices.
We continued to maintain investment in research anddevelopment (R&D), up slightly at CHF 28.2 million,
or 9.4% of sales, up from 9.1%. Our investment continues to bear fruit with another ten new products
launched successfully this year. This long-term strategy will ensure LEM has the right new technologies
and applications for customers, as their businesses
are increasingly driven by renewable energy, mobility, automation and digitization.
EBIT for the year 2020/21 improved by 4.4% to CHF
60.9 million from CHF 58.3 million, mainly due to theimproved gross margin and reduction in SG&A discussed above. Our reported EBIT margin was up at
20.2% compared with 18.9%, in line with guidance.

Key figures 2016/17 to 2020/21
in CHF millions

2016/172017/18 1

2018/192019/20

2020/21

Orders received

271.2

319.7

320.5

322.4

362.0

Book-to-bill ratio

1.03

1.06

1.00

1.05

1.20

Sales

264.5

301.2

321.6

307.9

301.0

Gross margin

123.6

138.9

146.5

142.7

140.6

46.7%

46.1%

45.6%

46.4%

46.7%

In % of sales
EBIT
In % of sales

64.8

58.3

60.9

20.1%

18.9%

20.2%

44.6

54.4

52.4

60.7

55.6

EPS basic (CHF)

39.11

47.76

45.97

53.27

48.79

Dividend per share (CHF)

35.00

40.00

42.00

40.00

42.00 2

Operating cash flow

52.8

54.1

53.5

73.6

50.9

Investing cash flow

–13.2

–15.1

–14.8

–14.7

–13.5

31.3.201731.3.2018 1

31.3.2019

31.3.2020

31.3.2021

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

12.8

12.6

4.5

10.2

–1.6

Shareholders’ equity

90.5

111.6

113.1

117.4

131.9

Equity ratio (in % of assets)

60.7%

60.0%

60.5%

51.0%

49.9%

Market capitalization

1’064.8

1’812.6

1’459.2

1’210.7

2’082

Employees (in FTEs)

1’453

1’527

1’477

1’497

1’481

1 Restated financial statements
2 Proposal of the Board of Directors to the Annual General Meeting of Shareholders on 24 June 2021.

Sales per segment

Regional sales breakdown

in CHF millions

in CHF millions

250

100

200

80

150

60

100

40

50

20

16/17

17/18

Automotive segment

10

63.1
21.0%

Net profit for the year

0

LEM Annual Review 20 | 21

55.8
21.1%

18/19

19/20

Industry segment

20/21

0

16/17

China

17/18

Europe

18/19

19/20

North America

11

20/21

Rest of world

LEM Annual Review 20 | 21

Financial results

9.4

Net financial income was effectively zero, with financial expenses offset by foreign exchange gains. The
Group tax expenses of CHF 5.3 million represent a tax
rate of 8.7%. This outcome was mainly due to non-recurring tax benefits, which if excluded would resultin an underlying rate of 17.4%.

Cash flow from operating activities was CHF 50.9
million (-30.9%) and free cash flow was CHF 37.4
million (-36.4%). This decrease is mainly due to two
factors: we have higher receivables outstanding
from strong Q4 sales, and we deliberately built-up
inventory in anticipation of supply chain shortages.

We posted a net profit for the year of CHF 55.6 million, down from CHF 60.7 million last year. However
last year’s net result was largely boosted by a non-recurring positive tax impact of CHF 14.0 million fromthe sale of technical IP from LEM Intellectual Property SA based in Fribourg to LEM International SA
based in Geneva and to LEM China. This year’s net
profit margin thereby decreased to 18.5% comparedwith 19.7%, although excluding the positive tax impact the net profit margin last year would have been
15.2%.

Our balance sheet remains strong with practicallyzero net debt. As of 31 March 2021, total assets increased to CHF 264.4 million. Shareholders’ equity
reached CHF 131.9 million, representing an equity
ratio of 49.9% (51.0% as of 31 March 2020).

%

R&D investments% of sales

20.2 %EBIT margin% of sales

55.6 mNet profit
18.5% of sales

LEM Annual Review 20 | 21

12

Improved dividend
Based on the results for 2020/21, our performancein adapting to the COVID-19 pandemic and the longterm fundamentals for the business, the Board of
Directors proposes a dividend of CHF 42 per share(CHF 40 for 2019/20), payable on 06 July 2021. The
proposal follows LEM’s dividend policy of distributing significantly more than 50% of its consolidated
net profit to shareholders and corresponds to a payout ratio of 86.1%, up from 75.1% last year.
Cautiously optimistic outlook
The dramatic impact of COVID-19 on the world economy has been well reported, although the actual
outcome for the past year was better than many predicted. The IMF consistently upgraded its forecasts
as the pandemic has evolved, and its bi-annual
World Economic Outlook in April 2021 forecast an
increase of 6.0% for global GDP in 2021 and 4.4% in
2022. However, there is a significant difference between Advanced Economies and China compared toother Emerging Market and Developing Economies,
with the latter group unlikely to benefit from vaccination programs as rapidly. The IMF identifies a numberof factors which will determine economic performance: the efficacy of vaccines against new variantsof the virus, the effectiveness of policy actions tolimit persistent economic damage, the evolution offinancial conditions and commodity prices.

LEM’s business does benefit from geographic andsector diversity. Our operations in China (accounting
for 38% of sales and 65% of production) were backup and running nearly at full capacity by the end of
March 2020. However, a substantial portion of our
China production is destined for export, and therefore is dependent on demand from other economies
as they adjust to the pandemic.
Despite this challenging environment, it is importantto remember the fundamental long-term prospects
for LEM remain strong, driven by mega trends suchas renewable energy, mobility and automation. We
see this particularly in the demand for our new products in solar power, EVs and e-mobility.

Our leading market
positions across diverse
regions and sectors resultin robust margins, astrong balance sheet andhealthy cash flow.

We are maintaining our key projects of investing in a
new production plant in Malaysia and a new global
headquarters in Geneva. We continue to invest in
R&D at between 8-10% of sales, ensuring we leverage new technologies. We are improving the efficiency of production, while also empowering ourglobal sites with full capabilities in R&D, operations,sales and quality management. This is making ourorganization more agile, increasing our speed of execution and reducing the time to market.
We have been encouraged this year by the steadydemand for our products and how the organization
has responded so well to such exceptional circumstances, and we are cautiously optimistic for the future. However, we must recognize that the impactsof the pandemic will reverberate across markets andsociety for many months if not years, and thus ourprogress is not entirely in our own hands.

Beyond these, there are two specific factors which
are likely to impact LEM’s business: shortages andsupply chain blocks for components such as semiconductors, and the ramifications of ongoing tradedisputes.

13

LEM Annual Review 20 | 21

Industrysegment
performance
A reliable agile partner, we continually reinforce
strategic alignment with key players and thought
leaders in our industry, adapting to clientdemands across markets. Despite the varied
global economic impacts from COVID-19,
Industry segment performance remained
resilient, thanks to our broad portfolio of
applications and new launches. We thus continue
to maintain significant market share in ourbusiness segments.

Powerful

SteadfastIndustry segment
performance

Solar inverter

Global industry market – quick reboundThe contraction of economic growth in 2020 due tothe pandemic was unprecedented in its speed andsynchronicity. After an abrupt slump in the first half of2020, global manufacturing rebounded in the second
half. Indicators suggest that manufacturing and tradeare back to pre-pandemic levels as of April 2021. The
near-term growth outlook for global manufacturing
remains positive, although at a slower pace (source:
IMF).
The J.P. Morgan Global Purchasing Managers’ Index
registered a sharp easing in the global downturn inJune 2020, while output and new orders both rosethroughout the third quarter of 2020 and new export
business expanded for the first time in over two years
in September. By the end of 2020, global manufacturing production saw rates of growth and new orders
remain among the strongest seen over the past decade. The index rose to a ten-year high as growth of
output, new orders and employment gathered pace inMarch 2021 (source: IHS Markit).
Against this unsteady global economic backdrop, Industry segment performance remained resilient,
thanks to our broad portfolio of applications and newlaunches. We thus continue to maintain significant
market share in our business segments. Although
COVID-19 interrupted global supply chains, we were
proud to deliver to our customers on time throughout
the year.
We are adapting to important and accelerating changes across markets, such as higher power densities,
the electrification of mobility, digital disruption, smart
grids and distributed energy resources. We won new
designs and accelerated the production of new sensors, such as the DC meter and integrated current
sensor (ICs) models.
LEM delivers steady performance
Sales in the Industry segment decreased by 6.3% to
CHF 225.2 million in the financial year 2020/21; atconstant exchange rates the sales decrease was
3.7%. Orders improved by 5.3% to CHF 267.8 million,
resulting in a full year book-to-bill ratio of 1.19. The
mid and long-term drivers for renewables are growing stronger thanks to major policy and technology
shifts. Sales in China increased by 8.5% due mainly

LEM Annual Review 20 | 21

16

to renewable energy, which is particularly encouraging in such a tough competitive market. China remains our most important single country, representing 35.3% of Industry sales. However, there weresignificant declines in other regions. Sales in North
America decreased by 16.4%, due to the manyclosed businesses while in Europe sales dropped by
11.4% due to the low demand for rail transport andreduced investment in test benches. Sales in therest of the world decreased by 13.5% due to theweak traction business in India and lower investment
in renewables and drives in Korea. Japan saw a difficult first half year, but started to recover in the second half thanks to investments into robotics. EBIT
decreased from CHF 50.4 million to CHF 49.4 million
while the EBIT margin slightly increased from 21.0%
to 21.9%.

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 & DC currents with high accuracy
and high immunity to external interference. LZSR,
primarily used on the AC side, measures evenhigher peaks of AC current.

LDSR 0.3-NP

Drives and welding
Sales in the drives and welding business dropped
only marginally by 1.5% to CHF 98.0 million, principally due to the strong recovery from China, Japanand Korea in the second half year. Automation andenergy savings applications are the main growth drivers for our sales. We still continue to receive very
positive feedback on the introduction of our new
product family of ICs for small drives and robotics.
Renewables
Sales in the renewables business grew by 3.6% to
CHF 81.6 million with customers from the Chineseand European solar industry producing for the world
market. With solar as the most stable type of green
energy, we continue to grow strongly in China due tothe country’s heavy investment in solar applications
and our new ICs family. Sales in Europe and the US
remained steady, mainly due to our products for gridmonitoring and the certified DC meters for the German market. Wind activity remains weak in most regions. We continue to build a pipeline of smart gridprojects and won some designs with new products.
Traction
Sales are down by 25.5% to CHF 38.0 million.
COVID-19 reduced the global demand for rail traffic
immensely, leading to lower investments in our traction and trackside businesses in India, China, Russia
and the US.

DC

AC
DC

AC

Solar inverter

HMSR 30-SMS

LZSR 150-P

17

LEM Annual Review 20 | 21

Industry segment
performance

DC fast charging stationfor electric vehicles

High precision
In the project-driven high-precision business, sales
declined by 31.0% to CHF 7.7 million. As hospitals
and the wider health care community focused oncontaining COVID-19, investments in MRI scanners
decreased. The pandemic also led to a lower investment in test bench applications. Still, our most recent product line, the IN family, continues to be wellreceived by customers thanks to its superior performance.
Moving into new markets
Our DC meter for charging green cars was launchedin 2020/21 and has seen a serious ramp-up in Q4 ofthis financial year. The DCBM offers a high level ofintegrated functions, with a reliable and certifi ed
solution for billing electricity for fast charger users.
With the official DC meter qualification and certification granted by the German Physical Technical Federal Institution PTB, LEM is one of the first to introduce integrated functions and a certified software
solution for billing electricity for fast charger users.
We shall continue to invest in the DC metering withthe aim of offering our solutions in other European
markets.
In the following pages there isan interview with an expert
from ABB about E-mobility infrastructure and where our
DCBM fits into this fast-developing landscape.

Industry sales
2020/21

CHF 225.2
millionDrives and welding
Renewables
TractionHigh precision

LEM Annual Review 20 | 21

98.0 m81.6 m38.0 m
7.7 m

18

In the drives business, we aremoving from current transducers with analog output to digital outputs. For our smart gridprojects, we finalized the development and ramp-up phaseof the ARU outdoor Rogowski
and AI-P1A Rogowski new integrator. Both products haveseen large orders and are leading our growth in the low voltage market. We continue todevelop other sensors basedon the Rogowski technology

to enter the highly promising medium voltage switchgear business. We offer a broad variety of secondary
cables and connectors.
LEM accelerated its efforts for ICs by preparing thelaunch of a large portfolio of smaller current sensors
in addition to the existing HMSR, a miniature current
sensor manufactured on semiconductor processes,
and GO series of chip-based sensors. The new family of ICs stands out with a high agility of application,such as robots in logistics, EV chargers and heatpumps, and allows us to penetrate new low-power,
high-volume applications such as air conditioners,
drones and e-bikes.
LEM organization – an agile and reliable partner
At LEM we pride ourselves on being a reliable partner forour customers, across all phases of a project, wherever
and whenever the customer needs our products andexpertise. The qualities of resilience and agility came tothe fore during the pandemic, and we are proud of how
all our global teams collaborated and adapted to new
ways of working.

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.

DC Meter

We continuously strive to achieve and reinforce strategicalignment with key players and thought leaders in our
industry. This includes technical product roadmap synchronization, but also the implementation of advanced
and most efficient logistic processes for seamless delivery around the world to guarantee best service levels
and timely delivery at best cost.
OutlookThe Industry segment continues to be impacted by
the pandemic and we are expecting new trade tariffs
in the first semester of 2021. As markets start to accelerate, supply chain reliance remains the biggest
challenge. This will inevitably impact our ability todeliver and sales in the first half of the coming financial year. However, LEM benefi ts from a portfolio
which is well balanced geographically and acrossapplications. Our order book on heritage and new
products is in very good shape, which will lead tofurther market share gains. We expect new opportunities in grid monitoring and EV charging systems in
the US, which might be accelerated by the new US
government administration.

LESR 25-NP

AC
AC
DC
DC
CDSR 0.07-TP

19

LEM Annual Review 20 | 21

E-mobility
infrastructure
Electric car drivers want to go long range
on a full battery and recharge quickly
and conveniently. At the right price. New
technologies in battery development andcharging infrastructure are key to success.
Whoever finds the best solutions will win
the market. The race is on. Niek Knapen,
expert in EV infrastructure, explains.

Speed

StaminaE-mobility
infrastructureInterview with Niek Knapen, Supply Chain
Manager / Strategic Sourcing, ABB E-mobility
Division, Eindhoven, The Netherlands

Consumer perspective

HistoryThank you for this opportunity to talk about myfavorite subject.

1. We are finally beginning to master EV performance and implement charging infrastructure ona large scale. What is key to success?
If you look at the modern electric car, the battery is
the most expensive part. The one who has the battery with the highest range per kilowatt and the lowest cost of the battery per kilowatt will win the market.

To understand the future of electric vehicle
infrastructure (EVI), it is helpful to take a look at thepast. People tend to forget that the first cars everdeveloped more than 100 years ago in Europe were
electric.1 At the beginning of the 20th century,
about 38% of the cars being sold were electric.2
The Baker Electric Roadster (US) had a range of up
to 100 miles (324 kilometers) with the old leadbatteries in 1911. So the advantage of electric cars
was known from the start. There’s only one
disadvantage of the electric car – the lack ofinfrastructure.

In 2010 the lithium ion battery cost about $1000 per
kW. In 2012 Tesla developed a battery with a different
chemistry that cost about $800/kW, so the battery
in a 85kW Tesla was around $65,000. Since then,prices of lithium ion batteries have dropped morethan 85%. Whereas the market average is $137, in2020 battery prices of below $100 were cited for the
first time.3 This price breakpoint means it will be
more economical to build an electric car than a combustion engine car. The forecast is for the battery
price to drop to $60–65/kW by 2025, through economy of scale and further technological development.

Electric cars were used in the cities but not in the
countryside because it did not have electricity forcharging. But for combustion engine cars, althoughdeveloped later, a horse and carriage with a big
tank of gasoline could go to a small village where acar could refuel.

2. The battery is key. What more can you tell us
about battery development?
First, from a price point of view the electric car is on
the verge of a complete breakthrough. You can buy
an EV for less than €50,000 that has a very acceptable range of 400–500 kilometers. There is only one
disadvantage, and that is that charging takes time.
Second, there’s the battery density. The whole drive
towards EVs started in 2009 with Tesla and 2010 with
Nissan. Since then, lots of companies were spending billions of dollars on batteries to create the “golden goose” or winning chemistry of batteries. Current
energy density of batteries is about 200-250 watts
per kilogram (Wh/kg). Forecast for 2025 are batteries with energy density of up to 1,000 Wh/kg.

Interviewed by Eleanor Close Kraft, Process AG,
Nick Miles, CPC

AC charging versus DC charging
On-board versus Off-board equipment

AC Charging

DC Charging

On-board
ChargerBMS
Li-ion battery

Every vehicle needs to have its
own on-board equipment

Infrastructure investment is sharedwith hundreds of users

Source: ABB, EV Infrastructure Product Group presentation, Niek Knapen, January 2020

The initial problems with electric vehicles in theprevious century are, to a certain extent, the sameas those we are faced with today. How can we
increase the range? How can we decreasecharging time? What does an optimal EV infrastructure look like?

There’s only one disadvantageof the electric car – lack ofinfrastructure.

LEM Annual Review 20 | 21

22

Battery development will continue and will affectwhere batteries are used. First, in EVs. Second, ine-buses for urban public transportation. And third, inelectric trucks used for distribution. This will also go
pretty fast. At a certain point, batteries will be usedin airplanes. 15–20 years from now we will see commercial flights for regional destinations. For longer
distances, the batteries are still too heavy.

Developments in charging
3. Let’s move on to the technical side of charging.
What are the developments?
Up until a couple of years ago, all electric cars used
AC current for charging. AC current goes to the car,and an on-board charger converts it to DC and thenthe battery is charged. Whereas DC charging takes
the entire process of converting AC current into DC
outside of the car. This removes weight (and cost)from the car and creates a public charging station
with the same standard to be used by any car.

The one who has the battery withthe highest range per kilowatt
and the lowest cost per kilowatt
will win the market.

With high-power charging today, a car with 90kW ofbattery can be charged in 15 minutes. Some claimthat new batteries, even solid state, will allow
charging in 10 minutes. However, that requires a battery with 1,200V.

1 www.energy.gov “The History of the Electric Car”
2 Encyclopedia Britannica, “Early electric automobiles”
3 BloombergNEF “Battery Pack Prices Cited Below $100/kWh for the First Time in 2020, While Market Average Sits at $137/kWh”

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LEM Annual Review 20 | 21

E-mobility
infrastructureMarkets and infrastructure

Public and commercial car charging – Use cases

7. What can you tell us about charging infrastructure in Europe? There seems to be a lack ofchargers in historic cities. Will this change?

Charging service should match charging application and demand
Public and commercial EV charging
AC destination

DC destination

DC FastDC High Power

3–22 kW

20–25 kW

50 kW

150 to 350 kW+

4–16 hours

1–3 hours

20–90 min10–20 min

– Office, workplace– Home– Multi family housing– Hotel and hospitality– Overnight fleet– Supplement at DC charging
sites for PHEVs– Office, workplace– Hotel and hospitality– Parking structures– Dealerships– Urban fleets– Public or private campus– Sensitive grid applications– Retail, grocery, mall,
big box, restaurant– High turnover parking– Conveniencefueling stations– Highway truck stops
and travel plazas– OEM R&D

– Highway corridor travel– Metro ‘charge and go’– Highway rest stops– Petrol station areas– City ring service stations– OEM R&D

Source: ABB, EV Infrastructure Product Group presentation, Niek Knapen, January 2020

4. Could you explain the benefits of AC charging
and DC charging?
This is where different kinds of charging service
comes in. AC charging takes longer but works fine at
the office, or overnight at home or a hotel. For shopping, higher capacity is needed to charge up faster.
On the highway, the goal is to charge fast and driveon, so this is where DC charging is critical. An 800V
battery can charge with 350kW in about 10–15 minutes.
What would it mean to the grid if we all drive EVs? It
will harmonize, or balance out, power production
and power usage. When you charge during the night,
there is an abundance of energy and consumption islow. When you charge during off-peak hours of theday, electricity from solar and wind can be used. This
could be a big benefit for our total electricity grid.
5. How would you describe your experience working with LEM on the DC charger?
In terms of EVI development, charging is happening
more and more in public places. Germany is the first
country to develop strict standards on power delivery to consumers i.e. you know for sure how muchyou are paying for the exact power you have charged.

LEM Annual Review 20 | 21

24

With LEM, we have developed a DC meter device
that we can build into our chargers to accurately
measure how much power is delivered and communicate this to each customer.
It is very important for us to have a partner with fullunderstanding of the sensor and measuring technology used for the specific application we are talking
about here. For all DC applications – from 24kW tosoon above 1 mW of charging – we need a measuring
device that is accurate and measures within thenorms and standards that have been set. LEM did agood job in delivering a device that fulfills these requirements.
6. Can you tell us more about the standard set by
Germany? Will this be used elsewhere?
While France and other countries are still looking into
new standards, they will probably adopt the German
VDE at 90% with small modifications. It will be a ripple effect by country, not imposed top-down by aEuropean regulator, but rather bottom-up from themarket. This happened with trains. If a standard has
been developed and works well, I expect it to be
adopted by other EU countries, and possibly as asimilar standard worldwide.

With electric buses in London, the last thing theywanted to do was to install these big pantograph systems in the old city center. They considered it ugly.
So they adopted bigger batteries to charge busesovernight at the depot. Design is important to Europeans. We try to hide our chargers in discreet cabinets or put them out of sight. We are getting more
and more requests for special design features forbus chargers.
Historically, over the past couple of centuries, wealthin Europe shifted from the south to the north. With
the new technologies, EVs are booming in the northern countries but lagging in the southern because
their electricity grids are not up to scale and need a
lot of investment.
8. What can you tell us about IONITY and ELAM?
The chicken and the egg story: EVs or EVIs? Tesla
realized more than anyone else that without acharging infrastructure you will not sell your car. IONITY is a consortium of multiple companies. The project will install a cross-European infrastructure able tocharge up to 350kW. That’s why we are participatingby supplying our charger with the LEM DC meter forthis network.
ELAM (Electrify America) in the US was different. VW
negotiated to have their penalty for the diesel scandal serve as investment into charging infrastructure.
This became the ELAM project, a consortium set up
by VW to roll out and manage this national infrastructure, so that with a CCS (Combined Charging System) standard car you can drive coast to coast. ABB
delivers the chargers.

9. From your experience what is the differencein adaption and potential of EV in the US andEurope?
In Europe manufacturers believed the EV should bea small car only used for driving around cities: small
battery, short range, local use. Tesla and the Asiancompanies had a different philosophy. Tesla envisioned a big car, a sedan, with at least 350 km range.
It was pushed by celebrities in the US and soon everyone wanted to drive a Tesla. By the end of 2015,
they had 1/3 of the market share for $100,000+ carsin the US. This scared the European manufactures.
However, the EU very early saw the need for standardized charging and connectors, and is way aheadof the US in this respect. President Biden’s infrastructure plan will have to roll out and harmonize
charging to make sure that at every charging station
you can use the connector you need.
10. What are the lessons from China?
Europe did a good job with subsidizing at the beginning. China did this as well. It is extremely importantto have government support and investments in the
new technology. China obviously does this in a hugeway. Europe could do much more to help support thetechnological development. If we are capable of developing a super battery with for example a 10kW/kg
and no one else can produce and make it at an economical price – we will win. I would not be surprised
if China comes out with it first.
Thank you for the discussion. I’ve been working 11
years in this business. E-mobility infrastructure is myfavorite subject.

If we all drive EVs, it will harmonize
power production and power usage.
This could be a big benefit forour total electricity grid.

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LEM Annual Review 20 | 21

Automotive
segment
performance
The 2020 global car market was hit hard by the
pandemic, with an output drop of 16.1% to74.6 million units. The significant shift to electricvehicles continued, now standing at 5% of global
output. LEM’s strategic focus on electric andhybrid powertrains underpinned our growth, withtotal sales up 12.2%, driven mainly by China.
During the pandemic our Automotive teams havemet all the challenges posed by our customers
and our suppliers.

Dynamism

PersistenceHybrid electric vehicles /Electric vehicles

Automotive segment
performance

Battery management
Highly accurate and ASIL ready sensors provide
all the required information to improve efficiency
and safety of the charging and discharging
process of the battery management system.

HAH3DR
Market dynamics strongly influenced by COVID-19
and electrification
The global vehicle production output in 2020
dropped sharply by 16.1% to 74.6 million units, owing
to the disruption caused by the pandemic across theindustry and the lockdowns that gripped consumer
demand in key global economies for several months.
The crisis particularly hit market demand and production during the first semester, with many automotive carmakers having shut down operations in the
US and Europe, and to a lesser extent in Asia. The
sector saw a sharp recovery during the second semester, heralded by China where carmakers resumed
operations earlier than in Europe and the US.

3

13 %

9

15

30 %

21

47 %
32

87
70
51

2020

2023

2026

Electric vehicles
Hybrid vehicles
Internal combustion engines

Electric Traction Motor
Electronics + Inverter
DC/DC Converter

Motor control
The accelerator gives the signal to themotor control to take power from the batteries.
Reliable sensors are integrated in or to theinverter modules to provide current signals
at very high speed to assure smooth andjerk-free acceleration.

Onboard Charger

Internal Combustion Engine

HMSR

Lead Acid Battery

Strong recovery driven by EV demand
Full year 2020/21 sales in the Automotive segment
totalled CHF 75.7 million, an increase of 12.1%. At
constant exchange rates, sales improved by 14.8%,
which is significant given the shutdowns during thefirst phase of the COVID-19 pandemic. The Q4 salesof CHF 22.9 million (+64.5%) are the highest quarterly sales yet achieved by the business.

New car production –propulsion share10

In response to this unprecedented situation, governments in Europe have put in place more ambitious
subsidy programs to support consumer demand forelectric vehicles (EV), while China’s subsidy scheme
has been extended for another year until 2022.
These measures helped further accelerate the electrification of the industry, with EVs representing
nearly 5% of the global production output in 2020
versus 3% in 2019. Despite the crisis, EV production
doubled in Europe to reach 1.3m cars, matching thelevels of China, while they remained broadly stable
year-on-year in Japan/Korea (369,000 units) and the
US (500,000 units). Conversely, the global production of conventional cars further declined by 16.1%
to 74.6m units.

GO

HBCT

With the acceleration of the deployment of EV platforms by carmakers, our products have been designed in for several vehicles which entered production in 2020.
Our largest market China performed excellently, withsales up +32.2%, driven by consumer appetite for
EVs and the launch of several new vehicles. We benefit from a leading market position, and LEM is well
positioned to capture growth opportunities unleashed by the government’s ambition to achieve
25% electrified cars by 2025. It is worth noting that
our operations in China have been operating at
100% since April 2020.
Europe continued its strong growth (+63.5%), as
manufacturers (OEMs) ramped-up their production
operations. Carmakers are under significant pressure
to achieve the CO2 emissions targets for new car
fleets, and we see significant investments to launch
new electric or hybrid-electric car platforms.

High Voltage Battery

HAH1DRCAB SF 1500

DC Charger

Source: IHS Markit 2020

1

LEM Annual Review 20 | 21

Electric vehicles (EV), defined as plug-in hybrids and battery electric vehicles but excluding traditional hybrids

28

29

LEM Annual Review 20 | 21

Automotive segment
performance

Sensor integration levels
Well positioned to capture growth on green cars
The green car sector now represents more than
80% of the Automotive revenues, reflecting LEM’s
strategic focus on electric and hybrid powertrains.
Analyzing our sales performance by the different
businesses underlines this dramatic shift:Battery management
We are offering intelligent battery sensors for start/
stop architectures combining a unique know-how
on current sensing technologies together with ourexpertise acquired on lead acid battery technologies.
For the full year 2020/21 sales grew by 1.7% to CHF
45.7 million, reflecting the US reduction in 12V demand offset by the increase in demand for high voltage products.
Motor control
Our sensors for power inverter applications provide
flexibility to Tier 1 and original equipment manufacturers (OEMs) in their design, with solutions that can be
implemented on various subsystems such as: gate
driver boards, power modules, integrated busbar
and standard busbar mounting.

Automotive sales
2020/21

Battery Management
Motor Control
Charging Systems

LEM Annual Review 20 | 2130

Charging system
This new product range is offering dedicated technologies to support transfer energy subsystems
from AC to DC and DC to DC with high and low voltages applications.
For the full year 2020/21 sales grew by 16.1% to CHF
3.4 million due to continued momentum for battery
electric and hybrid vehicles.
Constantly adapting our portfolio roadmap to thelatest technology trends
LEM works with the industry’s trendsetters to stayabreast of the latest technological trends and develop solutions that deliver superior value in our customers’ applications.
The electrification of the automotive powertrain isreshuffling the industry following three main trends:
functional integration, physical integration and higher power density. LEM is developing an ambitious
product roadmap by investing significant R&D efforts
in two directions.
First, we are building an Integrated Current Sensor(ICs) portfolio to address the need for ever higher
integration of the current sensing function in battery
management systems, power modules or power
conversion systems. GO and HMSR are the two firstbuilding blocks of this roadmap.
Second, we are collaborating with leading carmakers
and Tier 1s to develop complex modular solutions
featuring a high level of mechanical integration andfunctions. Modules include additional features(hardware and software) beyond a standard sensor.

CHF 75.7
million45.7 m26.7 m
3.4 m

LEM’s strategic thrusts

For the full year 2020/21 sales grew by 35.0% to
CHF 26.7 million, with strong demand spurred byEVs.

LEM resilience and agility
During the past year, our Automotive teams have amply demonstrated their resilience and agility. They
have met all the challenges posed by our customers
and by our suppliers. We pride ourselves on being
reliable partners, striving to achieve the highest levels of product quality and project execution.

Functional
integration
C

Leveraging our ASIC
know-how in developing
complex modules

Strengthening our
ASIC and ICs offer

Add’lfunctionality(e.g. voltage,
SoX)
Smart sensor(e.g. measurement evaluation)
Simple sensor(e.g. direct
output)A
Technology

B
Sensing
element(e.g. IC)

Semi-integrated
sensor(e.g. ASIC &shielding)Standard
sensor(e.g. stand-alone
sensor)Complex /customized sensor(e.g. integrated
busbar, multiphase)

Physicalintegration

Source: Strategy Engineers; AVL

Our products are also resilient, designed to operate
under demanding conditions and comply with themost stringent testing procedures for vibration andtemperature. In addition, our solutions enable ourcustomers to reach the levels of system safety required under international norms of functional safety
regulations, such as ISO 26262. We continuously
work to create and maintain a highly collaborativemindset by nurturing tight relationships with key actors across the value chain: research institutes, integrators, engineering companies, Tier 1s and OEMs
are our main stakeholders.

Outlook
The pandemic has caused very significant disruption
to the global economies and the long-term effects
are yet to be fully seen. This crisis has hit the automotive market, compounding the structural changes
linked to electrification, forcing all actors of the value
chain to adapt and accelerate the implementation of
new solutions to the market. We expect the shortterm outlook to remain tough, with the pandemic
sending shockwaves through supply chains, illustrated by the global shortage of semiconductors affecting the whole automotive industry. However, we areconfident about the long-term outlook. The strong
demand for electric vehicles is a driving force for thesector and all major actors are clearly committing
significant investments to this fundamental transformation of the market.

As we emerge from the COVID-19 crisis, the automotive
industry is pivoting sharply to an electrified future.
The increase in electric vehicles is already disruptive.
Opportunities will come to the organizations that are
most aware, knowledgeable, and proactive.
IHT Markit “Pivoting to an Electrified Future – The Automotive Industry Amps Up” April 2021

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LEM Annual Review 20 | 21

Trends,
technology,
R&D
The current sensor market is expected to growabout 8% annually until 2025, driven by mega
trends such as renewable energy, mobility anddigitization. Producing for both the industry andautomotive segments enables LEM to develop
larger systems, modules and semiconductors.
We continue to invest in new technologies and in
our highly skilled R&D teams. LEM launched
ten new products again this year.

Creative

Resolute

Trends,
technology,
R&D

Mega trends drive long-term growth
Our growth is driven by mega trends such as renewable energy, energy efficiency, reliable energy, distributed energy, mobility, automation and digitization.
They drive demand for sensors, give multiple opportunities to leverage LEM expertise and ensure a sustainable long-term business for all our stakeholders.

LEM has opportunities thanks to the switch to electric powertrains, the miniaturization of components
and the adoption of integrated current sensors.
Across both Industry and Automotive applications,
we see demand for additional functionalities towards
current transmission and digital information.

Based on IHS data and our analysis, the current sensor market is expected to grow from about CHF 2.6
billion in 2020 to CHF 3.9 billion in 2025. Our strong
heritage is Industry applications where we are market leader and have significant growth potential,
while our fastest growing sector in the long-term is
Automotive applications. Far from being a mature
market, current sensing products are undergoingsignificant changes, driven by new applications andtechnologies. These fast-changing markets will leadto pricing pressure, shorter product lifetimes, quicker return on investments and will require companies
to be more agile.

Technology trends
Ever higher power densities drive new current
sensing technologies
The power density is the amount of power generated
per unit volume of the motor. The more powerful the
motor in a smaller envelope, the higher the power
density. Increasing power density is therefore a critical factor to increase performance, as space constraints are present in virtually all industry and automotive applications.

We are developing smarter sensors
with data processing, safetywith self-diagnostics, and added
value with embedded software
to achieve real time computation,
which accelerates informationtransmission and decision making
in the system.

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34

Two technologies are enabling a step-change in levels of power density: Silicon Carbide (SiC) and Gallium Nitride (GaN). These allow higher switching frequencies and thus are very well-suited for industrial
applications where performance is key.
The increased demand for small sensors, capable ofhandling high levels of power density, led to theemergence of integrated current sensors over thelast decade. Integrated current sensors (ICs) measure the primary current line directly through surface-mounted integrated circuit (IC) and became atechnology of choice for industrial and automotive
applications thanks to their ability to sense high currents while using a very compact footprint.

Digital is disrupting energy andmobility usages
Smart grid and autonomous driving are two major
disruptions led by digital revolutions to bring smarter,
greener and more efficient ecosystems. This is creating a lot of data, communication and the need for
artificial Intelligence. At LEM we are developing
smarter sensors with data processing, safety with
self-diagnostics, and added value with embedded
software to achieve real time computation, which
accelerates information transmission and decision
making in the system.
The electrification of vehicles opens new
applications to current sensors
By 2028, 50% of annual car production will be using
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 125m of current phases measured in
2020, LEM estimates that the market will grow morethan 4x, to reach about 450m in 2028.
LEM believes on-board chargers (OBC), DC metersand DC/DC converters will play a key role in energy
distribution and management of hybrid and electric
powertrains. OBCs provide the means to recharge
the battery using an AC socket at home or from acharging station. DC/DC converter translates highvoltage coming from the battery to a lower voltage
which is then used for various on-board applications(A/C, electric power steering, etc.).
DC metering is becoming mandatory in the EU andthe US markets, as regulators want customers to pay
only for the power load of the battery of the vehicle,
net of power line losses. Detecting current leakage
is an important side application for DC metering,
bringing a protection for customers in case of a malfunction of the charging station. Ever higher power
levels (up to 800V) place the battery system as theheart of the hybrid and electric powertrains. Accurate battery management systems that can measure
the state of charge (SoC) and state of health (SoH),
have become increasingly important to ensure thedriver has access to reliable information on the remaining driving range, and that the battery cells arewell maintained to protect the battery life.

More stringent safety standards pave the way
for autonomous driving
Automated driving functions are realized with interconnected systems using Automated Driving Assistance Systems (ADAS). Those systems are replacing
part of a driver’s usual decisions keeping him andothers safe from hazards. To maintain this level ofsafety, ADAS are implementing functional safety defined by the ISO 26262 standard. We are introducing
this standard to offer the strongest safety functions
to our customers using LEM sensors in electrical vehicles powertrain systems such as battery, motor or
power converters.
Smart grid, a new market for current
sensing solutions
Our energy system is undergoing a radical transformation, as millions of electric vehicles hit the roadand terawatts of renewable energy capacity are installed. These changes are essential to decarbonize
our energy system but are creating significant challenges. First, wind and solar energy’s intermittent
nature force grid operators to provide flexibility to thesystem. Second, the rapid growth of Distributed Energy Resources (DER) is decentralizing the distribution network, increasing the complexity of its operation. A smarter grid is thus needed to reliably
integrate intermittent renewable energies and DERs.
LEM provides sensors that measure electrical parameters along the network, allowing grid operators
to monitor, control and automate the grid operation.
LEM offers best-in-class solutions for the ever-increasing demands of utilities and equipment manufacturers.

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LEM Annual Review 20 | 21

Trends,
technology,
R&D

Ongoing R&D investments
In 2020/21 we continued to invest in R&D to assure
long-term growth. Four main trends prevail in driving
our investments: strong global demand for electromobility; measurement of energy flows in smart
grids; requests from Automotive customers for functional safety through third-party certification; anddemand for tailored solutions in high volume applications.
Our investments are split into near-, mid-, and longterm projects, such as developing building blocks
for the next decade. Long term research and innovation around new applications is performed by our
R&D sites in Geneva and Lyon. In Beijing and Sofia
new products are developed for specific customers
and applications.
This is leading us from a traditional, electromagnetic
sensors company into a broadened business of various integration levels. Examples are the HMSR andthe DC meter for charging stations. The HMSR is an
integrated current sensor (ICs) which includes ahigh-performance ASIC, a micro ferrite and the benefits from a specific overmolding method ensuringhigh isolation in a very small package. The DC meterhas an intelligent ethernet interface and a high integration level into the customer product. Both products, launched in 2020, have seen a fast ramp-up
and are a success story of our collaborative work
approach.
Our R&D team provides a diversified skillset to deliver the best product. It is to our advantage that we
produce for customers in the industry and automotive segments, which allows us to leverage synergies
to produce larger systems, modules and semiconductors. This gives us the agility to master the value
chain from the design function at an IC level all theway up to the full sensor and customer application.
An example is the development of the DC meter,where we involved alpha customers early on andquickly provided prototypes for customer feedback.
Our broad skillset also led us to produce functionally safe sensors to protect customer products andusers from higher system and vehicle malfunction.
As a result, dedicated products in the automotive
segment have been certified by an external third party and are thus functional safety compliant.

LEM Annual Review 20 | 21

36

Development across sites, teams and segments
We slightly increased our R&D investment from CHF
28.0 million in 2019/20 to CHF 28.2 million in
2020/21 and continued to contract R&D resources
to support projects.
In Lyon we develop products for smart grid, traction,
DC metering for EV fast charging stations, and automotive battery management systems. Our talentdemonstrated great agility this year. The R&D sitemanager in Bulgaria moved to Lyon to lead the R&D
team. In turn, the position in Sofia was filled with anexpert from the local Technical Customer Support
team. In Lyon, one of our talents from the embedded
software team took on a new role with R&D innovation in Geneva. The Lyon position was filled with an
external hire.
The Geneva team is becoming our leading hub for
innovation and advanced engineering for products
going into drives, residual current detection, highprecision and semiconductors. We continued tostrengthen the semiconductor team with a mix ofindustry veterans and internal talents.
R&D teams in both Geneva and Lyon focus on new
and advanced technologies, such as embedded
software and validation, predevelopment of technologies and innovative applications of our products,
including algorithms for intelligent battery management. Therefore, we have a dedicated innovationteam on both sites, which is working with universities and technical institutions. In Lyon we are building up our automotive software development team,while in China and Bulgaria we continue to executemajor locally customized projects, such as open
loop sensors in Beijing and Rogowski coils in Sofia.
Technical focus and product launches
We are running product projects in the areas of automotive battery management, integrated current
sensors for renewable energy applications, drives
and traction.
With the production start of the HMSR in summer
2020, we are executing an ambitious roadmap in thisdomain by significantly increasing our capabilities in
the area of IC packaging, IC testing, characterization
and applications.

We launched a weather resistant outdoor ARU Rogowski coil and a digital integrator. Multiple Rogowski sensors for different applications are in the pipeline, such as a hard molded version. In our traction
business we updated existing products via testingand validation to be compatible with new standards,
and in China we engineered new sensors for trackside monitoring. Building on our successful launchof the 400 AMP DC meter for fast charging stations
last year, we are now designing sensors at lower
ranges, such as at 100 AMP. This will allow our customers to charge their EVs in convenient locations at
an economical speed of two to three hours. We also
continued to further extend our residual current detection solutions.

Product launches 2020/21
Product

Segment

Application

DCBM-400

Industry

EV chargers

DCBM-600

Industry

EV chargers

CDSR

Industry

EV chargers

HMSR

Industry

Drives, Renewables

ARU

Industry

Smart gridAI-P1A

Industry

Smart grid

ART-SP102

Industry

Smart gridTOP-90Industry

Trackside

CAB 1500 SF

Automotive

Battery management

HC16F

Automotive

Motor control

We further enhanced our battery management system family with a broader CAB product portfolio, including a functional safety certified version of CAB
1500 SF.
Our efforts were recognized by the granting of 3 patents, 1 utility model, and 18 designs.
Our significant investments in R&D over recent years
continue to bear fruit. In 2020/21 we launched 10
products.
OutlookIn 2021/22, the investment in our R&D capabilities
will remain stable. In Automotive we will focus oncompact packaging of products, improved performance, enhanced features and functionalities, aswell as reduced volume. In Geneva, new residual
currents will be in the pipeline and we will work on a
new product architecture. Our team in Lyon will continue to extend the DC meter portfolio and begin withonboard traction projects. In China, we’ll be focusing
on new transducers for high current levels in solar
applications, on trackside applications, and on acompact split core transducer. Our Bulgaria team will
be in charge of growing the Rogowski portfolio.

HMSR
New generation high insulated
integrated current sensor.
Product family provides a robust,compact and very accurate
solution for measuring DC
and AC currents in all highly
demanding, switching power
applications for commercial,industrial.

DCBM
A fully certified electricity meterfor use in automotive fast DC
Charging Stations. Consistingof a modular architecture(sensor unit and meter unit)
for optimal installation into thecustomers application.

CAB 1500 SF
Open loop fluxgate technology
sensor delivers superior accuracy
and offset performance.
Complies with stringent
ISO26262 ASIL C metrics.
Highly accurate current
measurement for automotive
battery management systems,
to extended driving range.

HC16F
Unique open loop Hall-based
sensor with measurement
up to 1,600 Amp. Suits allarchitectures up to 1,000 V.
Compatible with surface-mounted and through-hole assembly
processes. Highly versatilesolution for motor control
applications.

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LEM Annual Review 20 | 21

Culture, talent& values
The COVID-19 pandemic revealed the true
strengths of the LEM culture. Our teams
responded with resilience and agility, andwith a heightened focus on customer needs.
Several employees recount their inspiring
stories, and the two newest members of the
Executive Committee share their insights.
We are strengthening the links between ourvalues, behaviors and the way we develop
and attract talent.

Agility

ResilienceConversation

Two relatively recent arrivals at LEM and membersof the Executive Committee, Rebecca Cullinan,
Senior Vice President Industry, and Rodolphe
Boschet, Chief Human Resources Officer, share
their perspectives on the company today and theroad ahead.
1. What motivated you to join LEM?
Rebecca Cullinan (RC)It was time to try something different after over 20
years in the automotive sector. That business historically is very driven by cost pressures, with huge investments, and is associated with a poor track record in pollution management, although there is therecent pivot to EVs. I was attracted by LEM’s role inthe development of electrification, renewable energy and its contribution to a more sustainable economy.
And what about the experiences you could
bring to LEM?
Indeed, I felt that the experience, skillsets and process methods I had learned in large multinationals
could have a bigger impact in a smaller company
such as LEM. Meeting with my future colleagues, I
was enthused by their description of the company
being at cross-roads of markets and technologies,
moving both upstream and downstream. Moreover,it became clear that the company has a global mindset, and has ambitions to scale its impact.

I was enthused by my colleagues’
description of the company being
at a cross-roads of markets andtechnologies, by their global
mindset and ambitions to scale
LEM’s impact.
Rebecca Cullinan

LEM Annual Review 20 | 2140

And did the fact that LEM has a big presence in
China play a role, given your personal heritage?
Well actually I have spent most of my professional
life working in Europe (laughing), so this was more
an opportunity for me to play catch up on the growthof China. But I do bring a Chinese mindset and focus
on speed!
Rodolphe Boschet (RB)I would echo Rebecca’s motivations for joining. Having worked in the healthcare sector for many years,
it is important for me to have a real purpose in what
I am doing (especially for my children). So LEM’scontribution in enabling a more sustainable economy
was a key factor in my decision. And yes, there wasalso the attraction of joining a more “human sized”
company, where you can feel the impacts you havewith decisions, and in a shorter time frame. Third, thecompany is going through a transformation as it seizes many opportunities for growth; we are evolving
the culture, diversifying the talent, introducing processes and systems for scale. Finally, in the selection process I was impressed by the diversity ofthinking amongst the team – dialogue is encouraged.
2. The word transformation …does that resonate
with you Rebecca?
RC Absolutely. The world itself is going through atransformation, with 50% of our electricity due tocome from renewables by 2050. The businesses wesupply have to adapt dramatically – both industry
and automotive. For LEM we have to adapt our technologies, products, processes and people to themarkets and environment.
3. And of course, COVID-19 has been atransformational experience for the company.
How have your teams coped?
RC Actually, things turned out a lot better than I expected. We are a conservative company, so the concept of home-office was quite radical. It meant that
our ways of managing people had to change, we had
to trust and empower them more. It soon became
obvious that people were really motivated, could
manage themselves, and their output was great.
However, communication became even more important – personal conversations rather than justemail. And many of us do miss the interface withcolleagues over a coffee or tea. In short, we have
now proven that this flexibility of both on site andhome-office does work well for the future.
RB Personally, I started my role at LEM in quarantine
so that was a special experience (laughing); seriously it was a pretty efficient way to get immersed into
the company with documents and systems learning!
The first priority has to be the safety and well-beingof the people. Some really miss the workplace, so
we had to build in flexibility. Second, we had nochoice but to become more creative and take risks,
in order to serve customers and suppliers whom wejust could not meet physically. We run many global
projects, so as Rebecca said, that meant extra efforts on communication. Leaders had to do things
differently. For example, taking care of their teammembers and their personal well-being. Actually, as
part of our culture journey, there is a formal process
now for “checking in” and “checking out” with people on team calls, to cover this aspect.
4. Given the pandemic, the theme of this year’s
Annual Review is Resilience + Agility. Can you
share your own understanding of these words,
and give an example in practice from the pastyear?
RB First of all this year has shown that LEM’s positioning and business model were extremely resilient
despite the turbulences. It is the same for our people, because we know that our customers need us
and we take what we do seriously, it gives us thestrength to overcome some of the headwinds created by the pandemic. Because of our size and theintimacy we have with our customers, it is easier for
us to react and adapt to a changing environment
such as the one we encountered in the past months.
RC Resilience in Chinese is , it means to put a knife
on your heart. The pandemic situation has taught us
many valuable lessons including to realize the quality of our employees. In the day to day operations atsite level, we have witnessed the dedication of ouremployees to continue producing, delivering to thecustomers despite the difficulties of lockdown andspread of the virus. There has been no stop of production at any site during the pandemic, our operational teams have reacted well to extreme stress inthe supply chain. The remarkable result of LEM in

2020 was assured by the resilience and agility froma worldwide team.
5. You mentioned the Culture Journey. This
company-wide process started in 2019. Where is
LEM now?
RB Well, we have clearly defined and communicatedthe business rationale which requires an evolution of
LEM organizational culture, we call it the “story” ofLEM. And this has created much enthusiasm and creative ideas with discussions at all levels in the organization. So now we have defined the so called “LEM
Blue Behaviors” which, we believe, will help us drive
more innovation and make us more agile so we canbring even more value to our customers. We are currently in the process of embedding the LEM Blue
Behaviors in our HR processes from talent acquisition to the way we incentivise performance. Alongside this goes training and practicing, such as asking, giving and receiving feedback. And there is rolemodelling, starting at the top with the ExCo – wehave to keep each other accountable, and be respectful in the manner we do so.
And Rebecca what has been your personal
experience of this Culture Journey?
RC As I mentioned earlier, I come from over 20 years
in the automotive sector – this is a tough business,with a focus on efficiency and giving orders. So mynatural style of behavior was rather more aggressive
than constructive. Now I have learned that there aredifferent ways to get better results, welcoming thediverse perspectives of the team, listening better.
And with regard to the “WE”, our team has certainly
grown with better dynamics and a feel for how best
we complement each other. Lastly for the “IT” weare much better aligned across all of LEM on our purpose and strategies, with a common approach forboth the Industry and automotive segments.
6. Culture is also driven largely by the type oftalent in a company. What do you look for whenhiring new members of LEM?
RB Well, the first thing to observe is that the perfect
employee does not exist! I think there are 3 key attributes: firstly, we are effectively working in a teamsport, so you have to be a team player. Next, individuals who want to have an impact, are conscious of
the major issues facing the economy and society,41

LEM Annual Review 20 | 21

Conversation

Executive Committee

We have defined the LEM Blue
Behaviors which will help us drive
innovation and make us
more agile so we can bring evenmore value to our customers.
Rodolphe Boschet

and really appreciate how LEM fits into that bigger
picture. And thirdly, we need people who want tolearn, want to be challenged, and have the humility
to grow and add value, whatever their initial rolehere.
RC I look at it from the perspective of success factors. Given our heritage of being market leader, thebusinesses we are in and where we want to grow,
LEM must be first to market with any new products.
So that means the 2 key attributes for employees
must be a focus on innovation and being customer
and service driven.
And so as LEM is transforming with newtechnologies and markets, is that where you
hunt for new talent?
RB You are right, we like to find talent with exposure
to the new customers and markets we are targeting,and of course we are building competencies for ICs(Integrated Current Sensors).
7. You mentioned success factors. How do you
measure success in your particular functions?
RC Classically in any business it would be the revenue growth rate and its profitability. However, these
are actually the outputs and consequences of doing
the right things. So ultimately for us it is do we havea satisfied customer? And can we sustain the customer relationship to become a long-term partner for
many years? Coming from the automotive sector,
where the focus is on efficiency, speed and cost-cutting, and essentially one competes on price, it wasquite a change for me at LEM. Here, I have learned
the intrinsic value of the company is the customer
focus, designing solutions together, doing whatever

LEM Annual Review 20 | 2142

the customer wants, being flexible and going the extra mile. All this results in customers who are willingto pay for this added value, and deep relationships
over 20 years. These partnerships plus our portfolioof over 2,000 product references really does provide a significant barrier to entry for competitors.
RB For the Human Resources function, we have 3
focus areas for measuring success: firstly, employee
attrition rate – we need to prevent and learn fromwhy people leave. Then in terms of employee engagement, there is a bi-annual survey, with actionplans on improving communication around strategy
and organizational efficiency and we measure ourprogress through spot surveys. And another metricis the on-time delivery of talent, alongside the % of
positions being filled internally as we encourage employees to grow and support their development.
8. You have both spoken glowingly about the
many positive aspects of joining LEM. What can
the company do better?
RC Given part of the theme of this year’s Annual Review is “Agility”, I think we can still improve further
that attribute. By this I mean we can adapt better tomarket needs, and be faster. Also we should be more
rigorous, for example in the design and consistent
application of processes.
RB I agree with you about rigour. As we transformfrom an SME to a company with greater global scale,then we should be able to achieve 80% of output
through standard processes, rather than re-inventing
every time. And that leaves 20% for keeping the entrepreneurial spirit, being agile, and creating value.
We need to strike the right balance.

Frank Rehfeld

Chief Executive Officer

Rebecca Cullinan

Senior Vice President, Industry

Andrea Borla

Chief Financial Officer

Rodolphe Boschet

Chief Human Resources Officer

Rainer Bos

Senior Vice President, Automotive

43

LEM Annual Review 20 | 21

Culture and talent
for growth

Organization fit to capture growth
Our industry is changing fast and being shaped byseveral technology breakthroughs. So is LEM: we aremaking the organization more agile to ensure we capture and manage global growth to 2025. LEM is madeof the expertise, talent and leadership of the 1,500
people working relentlessly to bring customers thebest solutions. Our organization is evolving towards
a decentralized model where the headquarters are
responsible for strategy, setting standards, innovation and coordination. Decision making will become
increasingly decentralized as capabilities are being
deployed at each site in R&D, operations, sales andquality. With these changes, LEM is increasing speed
and agility while reducing time-to-market.

LEM offers people a significant
purpose and opportunity to makean impact on society, working at
the forefront of mega trends
such as renewable energy, mobility
and sustainability.

LEM Annual Review 20 | 21

44

Human resources function designed to enablegrowthAt LEM, Human Resources is a strategic business
partner, committed to maximizing sustainable global
growth by building organizational capability and awork environment where diverse talent can strive.
The HR function has four key pillars: being an employer of choice, attracting and developing readynow talent, continuous improvement of the function,and delivering operational excellence. These pillars
connect the company’s values and behaviors with its
overall purpose and sustainable growth strategy.
Employer of choice
We are developing and recruiting the best global talent with new competencies to deliver the growthpotential of the company. LEM offers people a significant purpose and opportunity to make an impact onsociety, working at the forefront of mega trends suchas renewable energy, mobility and sustainability. We
are a high-quality global employer, human-sized witha collaborative culture. As market leader in several
applications of electrical measurement, our employees enjoy intellectual challenges, diverse pathways
and global career opportunities.
Resilience & agility during COVID-19
Over the past year, all of us have had to adjust to theextra-ordinary consequences of the COVID-19 pandemic. Our teams have delivered outstanding performances, ensuring “normal service” for all our customers and delivering projects on time, while learningand integrating many new ways of working. This required not only new technical and digital skills, butalso adaptation of management and leadershipstyles. A very positive benefit of the pandemic has
been the improvement in communication acrossfunctions, and a greater appreciation of how bothplanned and spontaneous communication by leaders
can make a real difference to team performance. On
the following pages there are some inspiring stories
by employees from different functions and regions
about how they demonstrated resilience and agility
to overcome the challenges of COVID-19. It is intimes of pressure that one discovers the true worthof an organization’s culture, and how a sense of purpose enables people to be truly engaged, performing above and beyond the stated parameters of a job
description.

During the year we completed our bi-annual employee engagement survey. This showed some very encouraging results such as confidence in senior management, pride to work for LEM, team spirit andprofessional development where results are significantly above global average and more importantly
where we continue to improve year over year.
Progress towards a High-Performance Culture
In 2019 LEM began its Culture Journey program,starting with the Executive Committee. It has been
adopted by all senior management teams, and cascaded across the company with the engagement ofinternal Culture Ambassadors. Our goal is to continually develop a constructive High-Performance Culture to underpin how we all think, behave and communicate personally and collectively. Over the past
year, we have identified four groups of key “LEM
Blue Behaviors” which all employees should aspire
to embrace and enact, whatever their function orseniority:– Innovation and continuous improvement
mindset– Customer orientation and growth mindset– Team player mindset– Player/Learner mindset
Within these groups, specific behaviors have been
identified, and are being integrated into individual
development plans, performance assessment systems, and talent acquisition processes. It is alreadyclear that a Constructive Culture will help current
employees achieve their full potential and enjoy theirexperiences, as well as attract the right caliber of
new talent to ensure LEM achieves its strategic
goals.

High performance culture model

Sustainable
Performance

WE
WE
Collaboration
Trust & Respect
Mutual accountability
Shared values
No “elephants”

Player mindset
Learner mindset
Self awarenessSelf discipline
Coach

Shared purpose
Clear goals
Effective organization
Productive meetings

Source: sum people all rights reserved, 2020

45

LEM Annual Review 20 | 21

Culture and talent
for growthDiversity and inclusion
As LEM adapts its organizational structure to meetthe demands of its customers and seize the growth
opportunities of the various mega trends, there is aneed to diversify its talent base across different regions, product applications, technologies and support functions. The company is committed to ensuring that its talent acquisition and development
strategies are as broad-based as possible, recognizing that diversity and inclusion brings many benefits.
LEM provides equal opportunity to all qualified individuals. The share of female employees is 54% in
the overall workforce. However, given the historically high share of engineering positions in productdevelopment, sales & marketing and management,
the share of female employees in the non-production related activities is 29% which was a slight decrease compared to the previous year. We actively
seek female candidates in order to increase theirshare in the higher qualification positions, and there
has been significant progress in markets such as
China where many engineering graduates are women. In December 2019, we welcomed our first female
member of the Executive Committee with Rebecca
Cullinan as new Senior Vice President Industry. Several global responsibilities such as purchasing, supply chain, quality, finance and reporting, and groupcontrolling are headed by female employees. LEM
has several key female managers in China (Finance,
Purchasing, Quality, and Supply Chain) and in Bulgaria (General Manager, Purchasing, Human Resources,
and R&D). Last year 36% of management positions
were held by women which represents a significant
increase compared to the previous year.

Employee analysis
31.03.2021

31.03.2020

FTE
Permanent employees

1’297

1’376

Temporary employees

135

109

Trainees

16

12

1’448

1’497

Women in overall workforce

54%

54%

Women in non-production related activities

29%

31%

Women in management positions

36%

30%

Total

LEM Annual Review 20 | 21

46

During 2019 the Geneva site conducted an in-houseequal pay survey following a new disclosure requirement by the Swiss government. The analysis, which
was verified by an independent body, showed that
men and women earn the same salary for equivalent
positions.
Ready now talent
A committed workforce is essential for LEM’s lasting
success. To this end, we support our employees toattend regular leadership and job-specific training
and develop their personal skills. Our aim is to continue to invest 1.5% of total group salary costs forreskilling or upskilling with an increased focus on
web based / remote delivery to adapt to the newnormal. We are committed to developing our people
through job rotation, global projects, international
mobility and promotion. In the last year, internal talents filled 70% of positions requiring the management of teams. The implementation of the LEM Job
Architecture in 2021 will provide a clearer careerframework so each employee can co-create theirown career path within our company.
New talent
We are continually looking for new talent who wish
to make a difference and have a concrete impact onsociety. We offer a multicultural, human-focusedworking environment allowing self-fulfillment in a
growing and challenging context. We are focused on
hiring core competencies in new markets such as
smart grid, semiconductors and embedded software
as well as in the fastest growing area of e-mobility. In
addition to technical competences, new recruits
should demonstrate qualities such as humility, entrepreneurship, continuous improvement mindset, innovation and ambition.

Workforce by activity

Average length of service

1’448 total employees

1’297 permanent employees

9.9

10

14 %

8

7.4
6.4

6.8

6

15 %

4

9%
2

62 %

0
Years

Operations
Admin & Logistics

R&D
Sales & Marketing

Health and safety
We continue to enhance health and safety at theworkplace. The most important measures include
systematic health and safety training for newcomers,
annual evacuation trainings and signage in all areas.
All sites have a clear evacuation plan in place. We
perform regular internal and external audits to analyze the effectiveness of the measures and the development of improvements.

Operations
Admin & Logistics

R&D
Sales & Marketing

health authorities as well as the WHO. Globally, we
also adapted our way of working to make sure employees could work efficiently from home or split
their time at the office. We provided additional
equipment where necessary, implemented newcommunication tools such as Microsoft Teams andshared best practices on how to lead remote teams
with our people leaders so they could adapt to thisnew environment.

In regard to COVID-19, we strictly followed the hygiene measures and social distancing rules communicated by the local authorities across all our sites.
In Beijing and Sofia, production quickly resumed atfull capacity in April after the initial shutdowns. In
Geneva there was a three-month period when production was reduced, but this resumed at 100% in
November. We provided hand sanitizers and protective masks, deployed additional cleaning of door
handles and handrails, asked people at risk to stay athome, and issued employer certificates forcross-border commuters. In Geneva, we mobilized acrisis management team, which met frequently tomonitor the situation at the Geneva site and to follow
the guidelines provided by the local and national47

LEM Annual Review 20 | 21

Stories of resilienceand agility

Dina Stampasidou
Finance Manager, Europe & Tech France (R&D)

COVID-19 created the most volatile, uncertain, complex
and ambiguous environment we’ve ever seen. None of
us was prepared for it. On 13 March 2020 Bulgaria declared a state of emergency; the same day LEM announced my new assignment as General Manager of LEM
Bulgaria. In the context of the pandemic shock in theorganization, it was difficult to protect people’s healthand ensure business continuity without the support andcommitment of the whole team. Customer orders didn’t
cease, and we managed to stay operational. In fact, wedidn’t stop a single day. By year end we reverted back tonormal operations and met most Key Performance Indicators for the site. It was clear that in a period of crisis
the team unites with a common goal. Our new mission isto support business growth by becoming a LEAN culture
leader of the LEM Group. We focused on how, after the
pandemic, we will improve faster to become a reallyhigh-performance team. Training is now completed, andthe team is prepared. We have the critical mass to makethe change. Specific projects are defined and by midyear we will show first results.

LEM Annual Review 20 | 21

48

Working from home during a pandemic is a testament
to LEM’s agile workforce. Last year, our finance department integrated remote digital solutions, streamlining
communication and enabling global participation. Interactive dialog via daily face-to-face meetings encourages brainstorming and problem-solving. While adapting
to Germany’s COVID-19 restrictions as Finance Manager
of LEM Europe, I accepted the additional responsibility
to oversee, forecast, and budget the LEM Tech France
R&D entity. This unique situation has forced our department to reevaluate existing processes and integrate newprocedures that will remain in place. Although the global
economy is experiencing new challenges, I am extremely happy and proud to see our LEM team quickly adapt
and overcome these difficulties together without any
significant disruptions.

Verka Alexieva
General Manager & HR Manager, Bulgaria

Jinwoo Park
Sales Manager Automotive, Korea & Rest of WorldDue to the impact of the COVID-19, the support teamfrom LEM headquarters was unable to come to China
for equipment debugging. To ensure smooth transfer ofthe HO Tester2 project, our colleagues in Geneva madea detailed video to explain the operation of the equipment. They also introduced the use of virtual reality or
VR glasses for this purpose. The core members of our
project team in China carefully studied the video materials as well as use of the VR glasses in advance. Due to aflight problem, the planned arrival of the equipment wasdelayed for a week. Once here, the team members worked nonstop to solve the programmable logic system
controller (PLC) problem. The flexibility and dedicationof team members enabled us to quickly verify the equipment and deliver samples to the lab for inspection. In
the debugging process, we found the root cause of thehigh scrap rate of the insulation test, corrected the pin
length, and reduced this type of scrap rate to 0%. Mass
production began one week ahead of schedule.

Last year’s unexpected crisis impacted all of our customers. In such situations, I believe the most important
thing in a crisis is to see the whole situation. We had
to be flexible and act quickly. LEM Automotive has one
plant in China which I could not visit, but our supply
chain team supported us 100%. I communicated oursituation transparently with all our customers on a
weekly basis to help them make informed decisions.
I did the same with our supply chain team, of course.
This was possible because of long-standing relationships between LEM and our customers. The global sales
network also helped us see the development of our
products so we could adjust and support each region
very flexibly. We are a small company, but we are a global
company. This is one big advantage of working at LEM.
For Automotive, quick electrification of vehicles is changing the business situation constantly, but opportunities
are increasing. It’s like walking on fragile ice, but that’sbusiness. I enjoy the challenge.

Liu Zhihua
Operations Manager China

49

LEM Annual Review 20 | 21

Our behaviors
and values

Stories of resilienceand agility

During this crazy year, we worked on the new LEM DC
meter, to comply with PTB (National Metrology Instituteof Germany) certification for DC charging stations. Production was planned for December 2020, so together
with the R&D and sales teams, we suddenly had toreaddress our work process. It was a mindset change
for us. We shared information between all the teams to
be really agile and to respond quickly internally and tothe customer. This strengthened relationships between
LEM, our customers and our suppliers. It was important
to bring more transparency to all the teams: to have thesame understanding to avoid any mistakes, and to havea clear objective in the end. We found an approach toaccelerate the process with support from our customers
and from colleagues at LEM including purchasing andsupply chain. The new DC meter was launched on schedule as planned, with full certification. It is a big successfor LEM. We are expecting a high level of market sharefor this product, and the forecast for the future is excellent. The market is really booming.

Song Xiaoyang (Chloé)
Supply Chain Manager, China

LEM Annual Review 20 | 21

50

Our behaviors
The LEM team is made of the expertise, talent and leadership working relentlessly to bringcustomers the best solutions. We have identified 4 groups of LEM Blue Behaviors which
all employees should aspire to embrace and enact, whatever their function or seniority:

Mathieu Béguin
Product Manager Industry, Geneva

1 Innovation and continuous
improvement mindset

3 Team player
mindset2 Customer orientationand growth mindset

4 Player /Learner mindset

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

During the Chinese Lunar New Year holiday, China entered COVID-19 lockdown. On February 7th, we initiatedweekly online COVID-19 reviews for our sales teams tounderstand the supply side and communicate with ourcustomers, and for our sourcing and supply chain teams
to understand the customer side. We were bridging endto-end communication, which we shared with the whole
LEM organization. During the mainland shutdown, international customers had priority. As the global situation
changed, we allocated more resources to our domestic
market. In August 2020, a major Industry customer
doubled their order. With top management’s support, we
set up a special squad in China to organize all resources,from supply to production. Everything ran just-in-time
to shorten process lead time. And we delivered on time.
During the 2nd wave in Europe, a Covid-caused labor
shortage stopped production at a supplier in France.
With great effort by our sourcing, sales and R&D teams,
we validated a local supplier in record time and secured
delivery. Integration of the LEM supply chain streamlines
processes between automotive and industry, resulting
in flexibility of resource allocation and improvement incost efficiency.

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 dedicated to making thembetter.

We value teamwork
Teamwork is more than just working
together, it is bringing out thebest of everyone’s strengths.

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

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LEM Annual Review 20 | 21

Board of Directors

Responsibility

We believe that sustainable and ethical practices
create long-term value for all key stakeholders in society and assure the longevity of businesses. Our
success stems from operating within a clear value
system, following best practice principles and standards, together with the close monitoring of environmental, social and governance (ESG) key performance indicators (KPI).

Our success stems from operating
within a clear value system,
following best practice principles
and standards.

LEM Code of Conduct
The LEM Code of Conduct (CoC) is our key document. It reflects the United Nations Global Compact,global environmental standards and our core values.
It is a binding document for employees and business
partners, such as suppliers and consultants, whose
compliance we regularly audit. Every LEM employee
receives e-learning training on the CoC, including instructions and case studies, and signs it.

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 an electric or hybrid-electric car, and hence improves car weight andenergy consumption.

United Nations Global Compact
Since 2006 we adhere to the Ten Principles of theUnited Nations Global Compact (UNGC), which are
driving global action to achieve the Sustainable Development Goals by 2030. These principles, which
relate to human rights, labor, environment and anticorruption, are embedded in every aspect of LEM,
from our strategy to our actions. As we do every year,
we provided an update on our progress to the United
Nations which is available on LEM’s and the UNGC’s
website. In addition, we follow the best practice policies of the Universal Declaration of Human Rights
and the UK Bribery Act.

All our production sites are ISO 14001:2015 certified,an environmental certification which we renew regularly. Our production activities are compliant with
REACH (European Regulation for Registration, Evaluation, Authorization and Restriction of Chemicals),
RoHS (Restriction of Hazardous Substances) as wellas conflict minerals reporting and obligations. LEM
regularly publishes 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 to previous orequivalent models.

LEM Code of Conduct
From left to right: François Gabella, Ilan Cohen, Werner C. Weber, Andreas Hürlimann, Ueli Wampfler, Ulrich J. Looser

François Gabella
Member of the Board of Directors,
Member of the Strategy Committee

Ilan Cohen
Member of the Board of Directors

Werner C. Weber
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 andCompensation 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,
Chairman of the Nomination andCompensation Committee,
Member of the Audit and Risk
Committee

LEM Annual Review 20 | 21

52

EthicsHuman rights

Business practices

United Nations Global Compact– UN Sustainable Development Goals
Environmental standards– Preserving the environment– Protecting human health– Utilizing natural resources rationally53

LEM Annual Review 20 | 21

We recognize the importance ofmaking a meaningful contribution
within our organization and to keepscore of our environmental, social,and governance (ESG) performance.
ESG performanceWith our sensors for energy efficient applications, we
contribute to a more sustainable and responsible
world. Equally, we recognize the importance to makea meaningful contribution within our organization andto keep score of our environmental, social, and governance (ESG) performance. This is why we started
collecting key performance indicator (KPI) data since2015. Our ambition is to continually develop our internal capabilities and sustainability initiatives, and toreport transparently on our progress.
Environmental
We measure our environmental footprint through theconsumption of power, water, and fuel, the CO2
emissions from air freight, continuous compliancewith ISO 14001, and the number of supplier audits
conducted.
Power, water, and fuel consumption are measured by
the total numbers of sensors sold, as all of them are
directly output related. Gasoline is used for our company cars globally, mainly by our sales teams, andalso to back generators during power shortages in
China. We disclose CO2 emissions from air freight, as
this is the main mode of transportation to get our
products to our customers.

Our four production sites comply with the ISO 14001
standard. Every year, we audit suppliers based on
their ESG performance and make sure that our ESG
principles are well cascaded across our supply chain;
this is our standard procedure before we accept a
new supplier.
Since 2015, the KPIs for freight emissions as well as
fuel and water consumption have shown a positive
development and we maintain the ISO 14001 certification due to consistent processes. Globally, we
reduced our water consumption in our production
sites. The global COVID-19 pandemic reduced ourfuel consumption, especially in China, and represented a challenge to our on-site supplier audits. We
reduced freight emissions, as we are increasingly
using transportation with a lower CO2 footprint.
Social
It is our goal to foster a culture that encourages professional development, equal and fair treatment, andthat nourishes and empowers every individual. We
want to be a company where every employee canfeel 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. We reconfirm
that our Geneva site was audited for its gender pay
gap in 2019, demonstrating that women and men
earn the same salary for equivalent positions (seechapter Culture, talent and values). To help our talentprosper, we encourage them to seek professional
development. However, due to COVID-19, we had to
reduce our on-site training days in 2020.

ESG Key Performance Indicators
2015

2016

2017

2018

2019

2020

2020 vs 2019

Power consumption (kWh)/total numbers of sensors sold

0.152

0.149

0.141

0.144

0.156

0.151

–4%

Water usage (L)/total numbers of sensors sold

0.65

0.72

0.63

0.49

0.51

0.38

–24%

Petrol usage (g)/total numbers of sensors sold

1.25

1.21

0.89

0.85

0.90

0.72

–20%

Freight emissions in tons of CO2

N/A

N/A

N/A

7’618

7’577

6’520

–14%

Production sites with ISO 14001

100%

100%

100%

100%

100%

100%

38

36

55

46

44

32

Discrepancy between salaries of men and women*

N/A

N/A

N/A

N/A

99.7%

99.7%

Number of training days by external companies

287

410

571

366

908

420

–54%

Code of Conduct signed by our employees

93%

89%

93%

96%

97%

97%

0%

% of employees trained on the Code of Conduct

N/A

N/A

N/A

63%

84%

77%

–8%

Environmental

Number of supplier audits–27%

SocialGovernanceAll years are 12 month calendar periods*100% = no discrepancy, Geneva site only

Governance
We want our employees to act based on our CoC tomake sure that our values are well understood acrossall sites, cultures, and positions. This is why we ensure all employees sign the CoC upon their arrivaland require them to take an e-learning. The test was
launched in mid-2017, is based on 12 questions andhas to be retaken every three years. For the year
2020, 77% of our employees with more than six
months at LEM have taken this test. As a logical consequence of COVID-19, fewer training programs for
CoC and other subjects were conducted on site.

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Information for investors

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

Number of registered shareholders
31.3.2021

31.3.2020

1– 499

1’195

1’048

500 – 4’999

49

50

5’000 – 49’999

65

50’000 and more

2

4

1'252

1’107

Total

Share price development LEM HOLDING SA (LEHN)
compared to SPI

2500

2000

Shareholders by category
31.3.2021

31.3.2020

Institutional shareholders

44.3

48.7

Private individuals

25.2

25.6

LEM employees, managers and board

6.5

6.6

In %

Treasury shares

0.1

0.0

Nonregistered shares

23.8

19.1

Total

100.0

100.0

1500

1000

500

0

Share information
LEHN

Listing

SIX Swiss Exchange

Nominal value

CHF 0.50

ISIN

CH0022427626

Swiss Security Number (Valor)

2 242 762

In number of shares, CHF

Number of sharesYear high 1

2020/212019/20

1’140’000

1’140’000

1’998

1’520

1

980

850

Year-end 1

1’826

1’062

Average daily trading ­volume (shares)1

1’343

1’041

Earnings per share

48.79

53.27

42

40

2’082

1’211

Ordinary dividend per share2

1

31.3.1231.3.1331.3.1431.3.15

31.3.16

31.3.1731.3.18

31.3.19

31.3.20

31.3.21

Financial calendar
1 April 2021 to 31 March 2022

LEM share

Market capitalization as per 31 March

31.3.11

Source: Bloomberg

SymbolYear low

LEM share price (+220%)
SPI Index (+142%)

in CHF

1 (in CHF millions)24 June 2021
1 July 2021
6 July 2021
28 July 2021
8 November 2021
4 February 2022
24 May 2022
30 June 2022
5 July 2022
7 July 2022

Annual General Meeting for the financial year 2020/21
Dividend ex-date
Dividend payment date
First-quarter results 2021/22
Half-year results 2021/22
Third-quarter results 2021/22
Year-end results 2021/22
Annual General Meeting for the financial year 2021/22
Dividend ex-date
Dividend payment date

Source: SIX

2 Proposal of the Board of Directors to the Annual General Meeting of Shareholders for 2020/21

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LEM Annual Review 20 | 21

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

Copyright© 2021 LEM HOLDING SA,
Plan-les-Ouates

Concept and text
LEM
Cabinet Privé deConseils SA, Genève
Process AG, Zurich

DesignProcess AG, Zurich

PhotosMara Truog, Zurich
Xiao Nan, Shanghai incollaboration with Process
Shanghai
Getty Images

Printing
Druckprodukt, Zurich

Annual Review
20 | 21

LEM HOLDING SA
Chemin des Aulx 81228 Plan-les-Ouates
GenevaSwitzerland
www.lem.com