annual report 2015 - cicor group · annual report 2015 innovation for success cicor technologies...

Annual Report 2015

Innovation for success

Cicor Technologies Ltd.Route de l’Europe 82017 BoudrySwitzerlandwww.cicor.com

0_Cicor_GB15_Berichtsteil_Umschlag_en.indd 1-3 03.03.2016 15:39:42

SALES BY INDUSTRY2015 / 2014

SALES BY EXPORT REGION 2015 / 2014

Aerospace and defense Communication Industry Medical Automotive and transport Watches and consumer Other

Switzerland Europe (excluding Switzerland) Asia North America Other

8%

9%

30%

27%

9%

12%

5%

28%

9%

9%

27%

11%

12%

4%

40%

35%

1%

39%

36%

6% 7%

18%17%

1%

Published byCicor Technologies Ltd.

Design concept/Realisation Linkgroup AG, Zurichwww.linkgroup.ch

Fotos: Shutterstock, Belimed AG

ADDRESSESCicor Anam Ltd.15 VSIP Street 4Thuan An DistrictBinh Duong Province VietnamTel. +84 650 375 66 23Fax +84 650 375 66 24www.cicor.com

Suzhou Cicor Technology Co. Ltd.EPZ No. 11 BuildingNo. 666 Jianlin RoadSND-EPZ Sub-industrial ParkSuzhou, China 215151Tel. +86 512 6667 2013www.cicor.com

HEAD OFFICE Cicor Technologies Ltd.Route de l’Europe 82017 [email protected]

CONTACTCicor Management AGWorld Trade Center Leutschenbachstrasse 95 8050 ZurichSwitzerlandwww.cicor.com

Tel. +41 43 811 44 05 Fax +41 43 811 44 09 [email protected]@cicor.com

CICOR ADVANCED MICROELECTRONICS & SUBSTRATESCicorel SARoute de l’Europe 82017 BoudrySwitzerlandTel. +41 32 843 05 00Fax +41 32 843 05 99www.cicor.com

Cicor Americas Ltd.185 Alewife Brook Parkway,Suite #410CambridgeMA 02138USATel. +1 617 576 2005Fax +1 617 576 2001www.cicor.com

RHe Microsystems GmbHHeidestrasse 7001454 RadebergGermanyTel. +49 3528 4199-0Fax +49 3528 4199-99www.cicor.com

Reinhardt Microtech GmbHSedanstrasse 1489077 UlmGermanyTel. +49 731 9858 8413Fax +49 731 9858 8411www.cicor.com

Reinhardt Microtech AGAeulistrasse 107323 WangsSwitzerlandTel. +41 81 720 04 56Fax +41 81 720 04 50www.cicor.com

CICOR ELECTRONIC SOLUTIONSSwisstronicsContract Manufacturing AGIndustriestrasse 89552 BronschhofenSwitzerlandTel. +41 71 913 73 73Fax +41 71 913 73 74www.cicor.com

S.C. Systronics S.R.L.Zone Parc Industrial F-N310580 AradRomaniaTel. +40 257 285 944Fax +40 257 216 733www.cicor.com

Cicor Asia Pte Ltd.45 Changi South Avenue 2#04-01 Singapore 486133SingaporeTel. +65 6546 16 60Fax +65 6546 65 76www.cicor.com

Cicor Ecotool Pte Ltd.45 Changi South Avenue 2#04-00 Singapore 486133SingaporeTel. +65 6545 50 30Fax +65 6545 00 32www.cicor.com

PT Cicor PanatecBatamindo Industrial Park, Lot 323 - 324Jalan Beringin, Muka KuningBatam 29433 IndonesiaTel. +62 770 61 22 33Fax +62 770 61 22 66www.cicor.com

This annual report is published in German and English as a print and online version. The print and online German version is binding.© Cicor Technologies Ltd., March 2015

KEY FIGURES

in CHF 1 000 unless otherwise specified 2012 in % 2013 in % 2014 in % 2015 in %

Net sales 176 016 100.0 190 453 100.0 202 458 100.0 180 612 100.0

Change compared to previous year (%) –1.5 8.2 6.3 –10.8

EBITDA before restructuring costs 15 323 8.7 17 604 9.2 19 662 9.7 12 117 6.7

Change compared to previous year (%) 53.1 14.9 11.7 –38.4

Operating profit before restructuring costs (EBIT) 7 301 4.1 8 512 4.5 10 229 5.1 3 066 1.7

Restructuring costs – 0.0 – 0.0 – 0.0 –4 718 –2.6

Operating profit (EBIT) 7 301 4.1 8 512 4.5 10 229 5.1 –1 652 –0.9

Earnings before taxes (EBT) 5 057 2.9 5 816 3.1 8 958 4.4 –3 811 –2.1

Income taxes 1 081 0.6 –1 272 –0.7 –1 952 –1.0 –245 –0.1

Net profit before restructuring costs 6 138 3.5 4 544 2.4 7 006 3.5 662 0.4

Net profit/(loss) 6 138 3.5 4 544 2.4 7 006 3.5 –4 056 –2.2

Earnings per share 2.28 1.58 2.39 –1.37

Number of employees (FTEs at end of period) 1 512 1 912 1 852 1 958

Division results 2012 in % 2013 in% 2014 in% 2015 in%

AMS Division

– Sales 63 282 100.0 59 095 100.0 56 934 100.0 49 510 100.0

– EBITDA before restructuring 7 214 11.4 7 740 13.1 7 594 13.3 4 907 9.9

ES Division

– Sales 112 872 100.0 131 405 100.0 145 662 100.0 131 578 100.0


2 Cicor | Annual Report 2015 | At a Glance


Cicor | Annual Report 2015 | At a Glance 3

in Mio. CHF240,0

200,0

160,0

120,0

80,0

40,0

0,0

in %

12.0

11.0

10.0

9.0

8.0

7.0

6.0

5.0

4.0

3.0

2.0

1.0

0.0

Net Sales AMS Net Sales ES EBITDA margin before restructuring

2013 2014 20152012

NET SALES BY DIVISION AND EBITDA MARGIN BEFORE RESTRUCTURING

GLOBAL FOOTPRINTCicor is a globally active group of leading companies in the electronics industry. It is organized into two Divisions: Advanced Mi-croelectronics & Substrates (AMS) and Electronic Solutions (ES).

in CHF 1 000 unless otherwise specified 31.12.2012 in % 31.12.2013 in % 31.12.2014 in % 31.12.2015 in %

Non-current assets 129 400 61.2 135 777 60.0 55 115 36.7 49 910 33.0

Current assets 82 207 38.8 90 522 40.0 95 015 63.3 101 404 67.0

Total assets 211 607 100.0 226 299 100.0 150 130 100.0 151 314 100.0

Equity 120 390 56.9 125 853 55.6 67 439 44.9 59 700 39.5

Financial liabilities 33 013 15.6 43 590 19.3 38 239 25.5 48 215 31.9

Cash and cash equivalents 16 756 7.9 15 369 6.8 17 006 11.3 27 681 18.3

Net debt 16 257 7.7 28 221 12.5 21 233 14.1 20 534 13.6

Gearing ratio (net debt in % of equity) 13.5 22.4 31.5 34.4

Inventories 35 229 16.6 40 893 18.1 42 127 28.1 41 459 27.4

Trade receivables 26 007 12.3 29 553 13.1 30 869 20.6 27 791 18.4

Trade payables –20 470 –9.7 –21 037 –9.3 –23 658 –15.8 –21 831 –14.4

Net working capital 40 766 19.3 49 409 21.8 49 338 32.9 47 419 31.3

in % of sales 23.2 25.9 24.4 26.3

Capex in tangible assets 13 168 15 293 10 618 8 453

in % of sales 7.5 8.0 5.2 4.7

1_Cicor_GB15_Berichtsteil_1_en.indd 3 03.03.2016 15:17:51


KENNZAHLENPROFILE

Cicor Sales Offices Cicor Productions sites

Switzerland Bronschhofen, Boudry, Wangs Germany Radeberg, Ulm Romania Arad China Suzhou Vietnam Province of Binh Duong Singapore Singapore Indonesia Batam With 1 958 employees at

10 production sites world-wide, the Group supplies high-quality custom-made solutions to its clients in Europe, America and Asia.



AT A GLANCE

2 Key figures4 Profile6 2015 Milestones8 Coverstory 10 The Cicor Group 12 Cicor Technologies Ltd. shares13 Agenda, communication

KEY STATEMENTS

14 Board of Directors and Report of the Chariman and the CEO20 Electronic Solutions Division 21 Advanced Microelectronics & Substrates Division

23 CORPORATE GOVERNANCE

33 REMUNERATION REPORT

FINANCIAL REPORT41 Consolidated Financial Statements of

the Cicor Technologies Group72 Financial Statements of the Cicor Technologies Ltd.

80 Addresses



2015 MILESTONES

Cicor wins the Outsourcing Partner accolade at the high-profile “Medical Design Excellence Awards 2015”, and also secures the “Inno-vation for Medical Tech-nology” Award from the spe-cialist publisher DeviceMed

AWARDS

The consolidation of company sites* in Switzerland led to extra-ordinary restructuring costs of CHF 4.7 million, but will also boost the efficiency of existing produc-tion sites*Moudon in Boudry and Quartino in Bronschhofen

CONSOLIDATION OF COMPANY SITES

Cicor resolves to boost the production capacities in Arad, Romania, and to expand the product development and industrialization capabilities at its competence center Bronschhofen, Switzerland, by bringing activities together in a new production and administrative building

EXPANSION OF PRODUCTION CAPACITIES



The new Chairman of the Board of Directors Heinrich J. Essing, and the new CEO Dr. Jurg Dubendorfer, assumed responsibility for the Cicor Group in the second quarter

NEW CHAIRMAN OF THE BOARD OF DIRECTORS AND NEW CEO

At the end of November, the Cicor Group announced targeted mea-sures associated with the strategic realignment. The Group will more strongly differentiate itself from its competitors by leading-edge technologies, and comprehensive manu facturing services (“box-build-ing”) in fast-growing niches and segments

STRATEGIC PRIORITIES

With the two “Cicor Innova-tion Insights” symposiums at the end of January and the beginning of December, the Cicor Group established a platform for experts to hold discussions with top speakers and qualified podium discus-sions

SUCCESSFUL EXPERT PLATFORM

In 2015, the Cicor Group invested a total of CHF 8.5 million in pioneer-ing and leading-edge infrastructure, confirming its determination to lead technology-intensive market seg-ments, as well as to provide compre-hensive solutions

INVESTMENT



MODERN CONTROL PLATFORMSFOR SOPHISTICATEDAPPLICATIONS

Connectivity is the great technology trend of the current decade. Industry 4.0 has also entered into the field of medical technology. Networked devices simplify processes and ensure quality standards. Development expertise, know-how and experience are required to ensure the optimal coordination of safe networking as well as the control and operation of electronically controlled machinery and equipment. Hardware is only effective if the control software performs well and the operating interfaces use attractive graphics, and if it can be operated intuitively.

The Cicor Group develops control platforms for sophisticated applications based on current technologies. Cicor supports its clients through all development phases, from the design of control concepts, user interaction and graphic concepts, through implementation, verification, industrialization and production.

Belimed is one of the world’s leading providers of system solutions for cleaning, disinfection and sterilization in the medical and life science fields. Belimed offers a wide range of equipment, from infection control in the CSSD (central sterile services department), or for instant processing in the operating theater. The need for low error rates, efficient service intervals and low throughput times is addressed by the networking of machinery, and thus the automation and documentation of entire preparation processes. The control platform developed in conjunction with the Cicor Group offers an API “Application Programming Interface” that is tailored to the specific requirements of Belimed. Device data and features can therefore be made available to the user, other machines, superordinate systems, mobile devices or even a global service center.



“The new industrialization has huge potential – on the way to the fourth industrial age, we sup-port our customers with extensive development expertise and know-how.”



Electronics play an important part in most areas of our lives. Technology is steadily improving thanks to continuing innova-tions, and many devices have now evolved into everyday helpers we would not want to go without. Design and lifestyle aspects certainly play their part, and applications are optimized to deliver maximum benefits. Computer-assisted traffic control systems help us every day by guiding steadily increasing traffic, while on-board computers assist us inside our cars. Smart living – networked household appliances, home automation and multimedia devices – increases both our comfort and security. Mobile payment systems, car connectivity, Internet-enabled electronic devices – the list of new developments is long.

In medical technology, innovations are improving patients’ treatment and quality of life. The use of microelec-tronics in proton therapy is becoming ever more important in the battle against cancer. Aviation and space flight would be impossible without electronics. Microelectronics play a vital part in satellite research projects. Globalization and the unrelenting evolution of information and communication technologies are opening new avenues for collaboration. Companies that focus on their core business and make effective use of external specialists can secure a competitive edge through operational and strategic partnerships.

Cicor is a solutions provider with worldwide operations and a unique portfolio of services and technologies. The latest discoveries combined with many years of experience, state- of-the-art technologies and exceptional expertise make Cicor a dependable and innovative partner in the development and production of compelling solutions in the area of electronics.

ELECTRONIC SOLUTIONS

INNOVATIVE TECHNOLOGICAL SOLUTIONS IN THE AREA OF ELECTRONICS The Electronic Solutions Division is an internationally active full-service provider offering a wide range of production op-tions for PCB assembly, system assembly, box building, control cabinet construction, cable assembly, toolmaking and injec-tion molding. Its offering comprises outsourcing solutions for the development and manufacture of electronic PCBAs as well as complete devices and systems. Its global operations and production sites in Switzerland, Romania and Asia (Singapore, Vietnam, Indonesia and China) enable the company to exploit synergies and offer solutions based on extensive know-how.

ADVANCED MICROELECTRONICS & SUBSTRATES

TECHNOLOGICAL LEADERSHIP THROUGH INNOVATION As a leading manufacturer of sophisticated microelectronics and high-quality substrates, the Advanced Microelectronics & Substrates (AMS) Division offers a broad range of products and services of the highest standards. The microelectronics area offers state-of-the-art assembly and interconnect technologies as well as packaging technologies, while the manufacture of highly complex rigid, rigid-flex and flex circuit boards and thin- and thick-film interconnect devices is what marks out the sub-strate manufacture and processing area. In close collaboration with customers and partners, the Advanced Microelectronics & Substrates Division develops and produces sophisticated prod-ucts from prototype to large-scale production and guarantees a high degree of process stability, state-of-the-art production facilities, consistent quality and absolute delivery reliability.

Customized Box Building solutions

THE CICOR GROUP

COMPELLING SOLUTIONS



ELECTRONIC SOLUTIONS

Markets – Medical technology – Security equipment – Traffic and transport technology – Automotive – Industrial – Consumer – Communication – Building automation

Competencies and services – Development – Test engineering – Industrialization – Production – After-sales service

Applications – Defibrillators – Lung ventilators – Breast pumps – Shockwave therapy equipment – Electronic dosing systems for self-medication – Endoscopy capsules – Line-of-sight radio devices – Security access systems – Audiovisual systems for vehicles – Cable harnesses for vehicles – Data recording systems – Signal control systems – Door sensors – Measuring and regulating equipment – Human-machine interfaces – Process monitoring equipment – Sensors and sensor control systems – Machine controls – Sewing machines and embroidery systems – Telecommunication devices

ADVANCED MICROELECTRONICS & SUBSTRATES

Markets – Medical – Diagnostics – Sensors and biosensors – Optoelectronics – Industrial – Telecommunication – Aerospace / defense – Automotive – Watchmaking

Competencies and services – Highly specialized technologies for thin-film

and thick-film substrates – Full range of construction and connection technologies – Rapid prototype construction – Delivery of tested and certified PCBAs

Applications – Communications and radar technology – Radio communications networks, HF equipment – Navigation systems – Satellite technology – Avionics – Position sensors – Building detectors – Camera systems – Laser printers – Optical sensors – Particle detectors – Security systems in nuclear power stations – Control assemblies in the energy sector and

solar power technology – Airbag igniters – Medical implants (cochlear and retina implants) – Pacemakers and defibrillators – Medical sensors (intraocular pressure, respiratorygas,

blood pressure sensors) – Ventilator systems – Hearing aids – Insulin pumps – Catheters – Endoscopes – Diagnostic imaging equipment – Ultrasound devices



40

35

30

25

20

In CHF

Jan. Mar. May June Sept. Nov. 2015

Number of shares

35000

30000

25000

20000

10000

0

SHARE PRICE PERFORMANCE

Last price (in CHF) Volume (Number of shares)

CICOR TECHNOLOGIES LTD. SHARES

CICOR SHARESNUMBER OF SHARES

Number of shares as at 31 December 2011 2012 2013 2014 2015

Share capital 28 659 240 28 764 240 28 805 080 28 920 920 29 020 920

Number of registered shares issued 2 865 924 2 876 424 2 880 508 2 892 092 2 902 092

par value of registered shares (in CHF) 10.00 10.00 10.00 10.00 10.00

Of which treasury shares 418 1 500 1 500 1 500 1 500

Number of outstanding registered shares 2 865 506 2 874 924 2 879 008 2 890 592 2 900 592

KEY FIGURES PER SHARES

Key figures as at 31 December 2011 2012 2013 2014 2015

Profit/loss per share (in CHF) –0.80 2.28 1.58 2.39 –1.37

Equity per share (in CHF) 41.55 41.81 43.65 23.35 20.61

Gross dividend (in CHF) * – – 862 477 866 278 1 040 613

*Distribution from capital contribution reserves

SHARE PRICE

Stock market price in CHF per share 2011 2012 2013 2014 2015

High 54.50 36.40 37.00 38.90 38.00

Low 29.00 24.00 25.55 31.60 22.65

Year-end 33.80 29.00 34.50 35.55 25.20

Average number of shares traded per day 4 092 3 336 3 826 3 344 2 402

Market capitalization at year-end (in CHF 1 000) 96 854 83 373 99 326 102 761 73 095

The registered shares of Cicor Technologies Ltd. are traded on the domestic segment on the SIX Swiss Exchange in Zurich.Securities symbol: CICN/sec. no.: 870 219/ISIN Code CH0008702190/Bloomberg: CICN SW/Reuters: CICN.S.



AGENDA

Financial calendarGeneral Assembly: Thuesday, 19 April 2016Half Year Report 2016: Wednesday, 17 August 2016Annual Report 2016: March 2017

COMMUNICATIONCicor Technologies Ltd. follows an open and transparent information policy in the interests of its shareholders and the general public.

In its periodic and ad hoc reporting, the company is committed to equal treatment in terms of timing and content of all shareholders and members of the public who take an interest in the company’s business.

The Group informs its shareholders, the media, financial analysts and other interested parties through the following publications and communication instruments: annual report, half-year report, investor and media presentations, and press releases. Price-sensitive events are published on an ad hoc basis. Additional information about Cicor Technologies Ltd. and its subsidiaries can be found on the Group’s website at www.cicor.com.

The company can be contacted at any time at [email protected] or [email protected]. Interested parties can also sign up to a mailing list on the website to receive all new press releases immediately.

Contact addressCicor Technologies Ltd.c/o Cicor Management AGLeutschenbachstrasse 958050 Zurich, SwitzerlandPhone +41 43 811 44 05www.cicor.com [email protected]

MAJOR SHAREHOLDERSThe following shareholders, known to Cicor Technologies Ltd. from its share register and from published disclosures of share-holdings in the Swiss Official Gazette of Commerce, each held more than 3% of the total share capital as at 31 December 2015:

HEB Swiss Investment AG 29.25 %

Quaero Capital (vormals ARGOS Funds) 5.00 %

Escatec Holdings Ltd. 4.86 %

Free float (according to SIX Swiss Exchange) 60.89 %

OVERVIEW OF SHAREHOLDERS AS PER SHARE REGISTER AS AT 31 DECEMBER 2015

Shares entered in the Register 2 075 090

Shareholders entered in the Register 950

Shareholders with 1–1,000 shares 838

Shareholders with 1,001–10,000 shares 91

Shareholders with over 10,001 shares 21

DIVIDEND POLICYCicor Technologies generally pursues a conservative dividend policy aimed at increasing the value of the company. The Board of Directors proposes dividend payments in line with the busi-ness’s long-term and sustainable development, taking into account investments to be made into growth and the further development of the Group.

AGENDA, COMMUNICATION

CALENDAR AND CONTACTS


14 Cicor | Annual Report 2015 | Key statements

The Cicor Group looks back on a difficult 2015 financial year, with lower sales and lower operating results than in the previous year. The abandonment of the minimum Swiss franc exchange rate against the euro unsettled many Swiss customers and caused orders to be delayed. The Board of Directors and the Group Management lined up targeted measures in accordance with the Group’s strategic focus. These measures are designed to establish the foundations for the Group’s renewed and sustainably profitable growth. The price pressure caused by the currency situation had an impact on sales and results, and the measures initiated had only a limited positive effect on the results. The Advanced Microelectronics & Substrates (AMS) Division continued to struggle with a difficult market environment in its core markets. The Electronic Solu-tions (ES) Division was hit above all by falling sales at two major customers. Investments continued to be made in highly-promising technologies and expanded services. Due to the results in the 2015 financial year, the Board of Directors will propose to the Annual Shareholders’ Meeting to forego the distribution of earnings.

Andreas Dill, Heinrich J. Essing (Chairman), Robert Demuth (Vice President), Erich Haefeli


Cicor | Annual Report 2015 | Key statements 15

During the 2015 financial year, the Cicor Group saw its business activities contract. This was caused by a difficult market envi-ronment in Switzerland, compounded by a decline in sales at two major customers. Immediate measures, programs to increase efficiency, restructuring, as well as targeted measures in terms of the strategic focus were adopted and implemented, or are currently in the process of being implemented. These are designed to ensure that the Group can return to the path of growth. Nevertheless, in this difficult year, the Cicor Group put its implementation skills to the test and was able to increase customer satisfaction. Important new customers were acquired, thus strengthening the focused segments of medical and in-dustry. The joint market presence of the two Divisions was well-received by global customers and has already attracted the first joint orders. The services and capabilities of the ES Division were also carefully expanded, in order to meet the very high regulatory requirements for product development and production in the field of medical technology. The technology road map of the AMS Division was focused even more sharply last year on the technological challenges of customer applica-tions. This is a decisive factor for the future growth of the Division. AMS technology experts are now more frequently in-volved in customer development activities. Its proven ability to develop new products in close collaboration with its customers and then to produce these cost-effectively for these customers determines the Group’s strategic focus.

DEAR SHAREHOLDERS,



LOWER SALESThe operating conditions for the market segments addressed by the Cicor Group varied in the 2015 financial year. Due to the abandonment of the minimum Swiss franc exchange rate against the euro, the Group’s key Swiss market segment was hit hard. By contrast, there was higher demand for production capacities in Eastern Europe. Demand in the focused markets of the USA and Asia remains much stronger than in Europe. Net Sales in the year 2015 of CHF 180.6 million fell by 10.8% relative to 2014 (CHF 202.5 million). In local currency terms, sales con-tracted by 6.9%, the Cicor Group grew in local currency terms at its Romania and Singapore sites. Healthy growth was also posted by the Engineering Unit at the site in Bronschhofen near Wil in Switzerland. This confirms the importance of Switzerland as a center of excellence for product development and engi-neering.

The growth achieved by the industrial segment, which saw its share in sales increase from 27% in the year 2014 to 30% in the year 2015, was particularly noteworthy. For Cicor, this segment, together with the consistently strong medical market segment, is the main focus of its activities, as this is where demand for engineering support and expertise in product launches and production design is continuing to grow.

For all market segments, many original equipment manu-facturers (OEM) are following the outsourcing trend, due to the challenging requirement to uphold certifications, the need for state-of-the-art production facilities, and increasingly complex supply chain operations. They are looking for a partner able to cover the entire product life cycle management, which conse-quently offers opportunities for companies such as Cicor that are able to offer corresponding development, technology, and production expertise.

The net sales of the ES Division fell by 9.7% to reach CHF 131.6 million. In addition to lower sales for two large-scale customers, competitive pressure in the European electronics manufacturing business remained high in 2015. A substantial project secured at the end of 2014 as well as the customer projects obtained in 2015 were not able to offset the fall in sales.

Sales recorded by the AMS Division in the year 2015 reached CHF 49.5 million, which is 13.0% lower than in the year 2014. The relatively poor sales seen during the first half of 2015 weakened even further during the 2nd half of the year, due to a fall in demand among a number of customers. In particular, orders from the watchmaking sector declined, confirming the long-term trend in this segment. As a consequence, the watch-es and consumer goods segment accounted for only 12% of Group sales (2012: 20%).

At the end of 2015, targeted measures were introduced to strengthen profitability and achieve the desired EBITDA mar-gin. For example, the AMS Division’s two Swiss printed circuit board production sites (Moudon and Boudry sites) are to be merged in Boudry. Customer support, provided by the ES Divi-sion in Switzerland, will be relocated from the existing two sites to a joint site of the ES Division in Bronschhofen. These mergers of Swiss sites will boost efficiencies and reduce costs in both Divisions. The restructuring costs associated with this move totaled around CHF 4.7 million. Within the globally positioned Cicor Group, with its production sites in Germany, Romania, China, Vietnam, Indonesia, and Singapore, the Swiss sites con-tinue to play a central role.

Particularly note-worthy growth was achieved by the in-dustrial segment, which saw its share in sales increase from 27% in the year 2014 to 30% in the year 2015.



ORDER BACKLOG AT THE END OF THE YEARThere was a particular emphasis on winning new customers in the year 2015. The acquisition of new, international custom-ers during the past financial year remained below expecta-tions and for this reason a variety of additional activities were launched at an early stage in order to intensify sales activities. The Group’s positioning was adjusted, and the portfolio of tech-nologies and services of the entire Cicor Group was emphasized, thereby underscoring the Group’s unique profile. In Swiss franc terms, order intake recorded in the year 2015 (CHF 176.3 million) declined relative to 2014 by 9.4% to (2014: CHF 194.7 Mio.). In local currencies, order intake fell 4.7% year-on-year. Despite lower order intake, at the end of 2015 the Group had a order backlog with a delivery volume of CHF 103.2 million from 2016 onwards. REDUCTION IN RESULTSDuring the course of 2015, the year under review, the Cicor Group switched its financial reporting from IFRS to Swiss GAAP FER. The switch took place retrospectively to 1 January 2014, and the figures for the previous year were adjusted corre-spondingly in the consolidated financial statements. The use of Swiss GAAP FER ensures that the Cicor Group will continue to present high-quality and clear financial accounts that pro-vide an accurate picture of the asset, financial and earnings situation, in accordance with the “true and fair view” principle. The retrospective amortization of the goodwill over five years led to a reduction in equity. Additionally, the pension liabilities recognised in context with the existing pension schemes are significantly lower under Swiss GAAP FER than they were un-der IFRS. In overall terms, the effect of the switch reduced the balance sheet total and the equity ratio. The effects of the switch relating to the previous year, 2014 are detailed under Note 2.1 in the notes to the consolidated financial statements.

Together with the reduction in sales and due to falling margins profitability fell at a disproportionally higher rate than sales. Operating result before interest and taxes (EBIT) as well as net profit fell sharply. The operating profit (EBIT) reached CHF –1.7 million or –0.9% of net sales (2014: CHF 10.2 Mio./ 5.1%), the operating profit before restructuring costs reached CHF 3.1 million. The ES Division recorded a positive EBIT, but the figure at AMS was negative. Cicor achieved an EBITDA before restructuring of CHF 12,1 million (2014: CHF 19.7 million); the EBITDA margin before restructuring declined to 6.7% (2014: 9.7% ) of net sales. Net profit reached CHF 0.7 million in the 2015 financial year (Net profit 2014: CHF 7.0 million) before restruc-turing costs of CHF 4.7 million, or CHF –4.1 million after taking account of restructuring costs.

Many factors contributed to the fall in results: The cost-cutting measures implemented were unable to fully offset the decline in profit from reduced sales. Exchange rate move-ments also meant that the dependence on the Swiss franc had a major impact on the results, despite the fact that the Cicor Group had steadily reduced this factor in recent years. In addi-tion, the result was also negatively impacted by the altered product mix. In general terms, excess market capacity had the effect of depressing prices.

EXTENSION OF TECHNOLOGICAL LEADERSHIP AND THE PORTFOLIO OF SERVICES The Cicor Group’s business is highly technology-based and entails the operation of a large number of complex, costly devices and processes. To be positioned in the market as a comprehensive solution provider, a comprehensive portfolio of technologies and services are specifically required for the development and production of customer products.

During the 2015 financial year, the Cicor Group invested a total of CHF 8.5 million (2014: CHF 10.6 million) into key proj-ects related to the updating and modernization of production facilities in all regions. Particularly worthy of mention is the newly-acquired capability to manufacture medical products under heightened clean-room conditions, obviating the need for subsequent sterilization. This helps customers to reduce costs and boosts the competitiveness of their products. Thanks to this and other investments, Cicor is continuing to consolidate its technological leadership.



BALANCE SHEET REMAINS SOUNDThe consolidated balance sheet remained sound for the year 2015 as a whole, including after the switch from IFRS to Swiss GAAP FER. With equity of CHF 59.7 million and a balance sheet total of CHF 151.3 million, the equity ratio was 39.5% . Net working capital at the end of 2015 was CHF 1.9 million lower than in 2014 and totalled CHF 47.4 million. Net debt on 31 December 2015 was CHF 20.5 million, compared to CHF 21.2 million as at 31 December 2014.

Free cash-flow for 2015 totaled CHF –0.5 million (2014 CHF 7.8 million). Thanks to the syndicated bank loan signed in December 2014, with a funding framework amounting to CHF 65 million, Cicor retains the long-term financial flexibility it needs to return the Group to growth.

PERSONNEL CHANGESAt the Annual Shareholders’ Meeting in April 2015, Cicor Group shareholders elected Erich Haefeli as a new member of the Board of Directors. Antoine Kohler and Hans Knöpfel did not stand for reelection at the Annual Shareholders’ Meeting. Heinrich J. Essing assumed the position of Chairman of the Board of Directors from Antoine Kohler. On 1 June, the new CEO, Dr. Jürg Dübendorfer, joined the Group. He has extensive expe-rience from his international activities. Jürgen Steinbichler joined the Cicor Group in August 2015 and assumed overall responsibility for the AMS Division from Pascal Keller who left the Group in Novmeber 2015. Jürgen Steinbichler has extensive specialist expertise in the semi conductor field as well as in the electronics industry, and long-standing business experience from a number of senior positions at internationally-operating corporations.

NO DISTRIBUTION OF EARNINGSOn account of the results recorded in the 2015 financial year, the Board of Directors will propose to the Annual Shareholders’ Meeting that no distribution of profits should be made for the past financial year.

OUTLOOK: CHALLENGES IN THE 2016 FINANCIAL YEAROver the past three years, Cicor has intensively invested in expanding its global footprint and production capacities abroad. In comparison to earlier years, its global focus helped to signi-ficantly reduce the dependency on Switzerland as a production site as well as the impact of exchange rate movements.

During the final quarter of 2015, our market environ-ment cooled markedly. The falls on international stock markets in January 2016 further unsettled the electronics industry and reinforced the usual seasonality of the first quarter of the year. It remains unclear what impact this uncertainty will have on our order intake and, as a consequence, the sales and earnings performance of the Cicor Group is difficult to forecast for the 2016 financial year. Assuming the macroeconomic operating conditions remain the same as those that prevailed in the 2015 financial year, we expect the results of the internal changes to produce growth in sales and results during the 2nd half of 2016. The Cicor Group will do everything it can in the year 2016 to return to a sustainable growth course.

On behalf of the Board of Directors and the Group Man-agement, we would like to thank all those who contributed towards the performance in the 2015 financial year: our em-ployees for their commitment and dedication, our customers for their loyalty and our shareholders and business partners for the confidence they have shown in us.

Heinrich J. Essing Dr. Jürg DübendorferChairman of the Board of Directors CEO



HEINRICH J. ESSING, CHAIRMAN

“The Cicor Group will do everything it can in the year 2016 to return to a sustainable path of growth.”

DR. JÜRG DÜBENDORFER, CEO

“The Cicor Group invested in a targeted way in the

extension of technological leadership and the portfolio

of services on the way to becoming a comprehensive

solution provider.”



ELECTRONIC SOLUTIONS DIVISION

CHALLENGING FINANCIAL YEAR

The situation during the second half of the year remained un-changed in comparison with the first half of 2015. The pressure on prices caused by the currency situation remained stubbornly high. The electronic production capacities available in the market exceeded market demand. This situation led to pressure on prices, affecting not just series and mass production, but also prices for the production of prototypes, zero series, and very small series. Production capacity utilization at the site in Arad in Romania remained high, as did demand for Romanian production services, confirming the importance of the planned construction project in Romania.

The performance of the business in the Asia region remained unchanged during the second half of 2015 in com-parison to the first half 2015. However, there is increasing demand for smaller unit volumes with greater product variety, which calls for greater flexibility at the production sites. A major project secured at the end of 2014, as well as the customer projects acquired in 2015, were unable to offset the decline in sales at two major customers. While the decline for one of these two customers was brought about by a strategic realignment, the reason for the decline for the other customer was a delay in the market launch of its latest product. Sales of its existing product were already considerably lower. The newly-acquired customer projects relate to highly-complex products. The prod-ucts are at an early stage in the product life cycle and are being produced only in low numbers. Demand for engineering services remained high throughout 2015. In this field, a trend towards early involvement in the technical product design at the cus-tomer is apparent, although this also imposes greater demands on feasibility studies. On the one hand, the advantage of this very early involvement is that production aspects can be intro-duced earlier and more effectively. At the same time, however, it also extends the time between winning the order and man-ufacturing the product.

Sales at the ES Division during the 2015 financial year were CHF 131.6 million, which is 9.7% below the respective figure for the previous year (2014: CHF 145.7 million). In local currency terms, the decline was 5.8%. On account of the lower sales, the currency effects and the pressure on prices, EBIT reached CHF 5.1 million, which was clearly lower than in the previous year (2014: CHF 10.0 million). At the EBITDA level be-fore restructuring, the result was CHF 9.4 million, corresponding to a decline of CHF 4.5 million relative to the previous year 2014.

MARKET ENVIRONMENT

OPPORTUNITIES THANKS TO DEVELOPMENT EXPERTISE AND KNOW-HOWThe fourth industrial age has huge potential for companies such as the Cicor Group in a variety of market fields. The major technology trend of networking (IoT, Internet of Things) is also increasingly influencing the design and the features of our customers’ products. This trend will lead to new business op-portunities, both for our customers as well as for the ES Division.

The situation in the market segments of Switzerland and Europe is set to remain difficult, and competitive pressures remain high. The highest quality in the field of services and production processes as well as flexibility are important pre-conditions for success in this environment. Asia remains the market segment with the highest expected growth rates.

OUTLOOK

FOCUS ON BOOSTING EFFICIENCY AND THE INTERNATIONAL SALES ORGANIZATIONConstruction of the new building in Bronschhofen is proceed-ing according to plan. The first offices are set to be occupied during the third quarter of 2016, and the production facilities are scheduled to become operational at the beginning of the fourth quarter. With the move into the new building interfaces within order processing and product productions will be reduced or even eliminated which will lead to an improved efficiency. Planning activities for the new building in Romania continue. It is expected to move into the new building in 2017. The produc-tion site in Arad will then be able to double its current produc-tion capacities.

In addition to the two building projects, targeted activ-ities in the individual sites, promoting “box building” services, boosting sales growth, and improving efficiency will be persued during the 2016 financial year under the heading of “Business Excellence. Another key measure will be the strengthening of the global sales organization. This will support and promote the necessary growth in the regions of Asia and Europe.



ADVANCED MICROELECTRONICS & SUBSTRATES DIVISION

DIFFICULT BUSINESS ENVIRONMENT

The results reported by the AMS Division in the past financial year were characterized by the demanding economic environ-ment. A large proportion of the market segments stagnated during the period under review. The Swiss watchmaking in-dustry, in particular, continued to disappoint. Due to this situ-ation in the watchmaking industry, at the end of 2015, the Cicor Management Team took the decision to merge the two Swiss printed circuit board production sites in Moudon and Boudry to create a single facility in Boudry. In addition, the decision of the Swiss National Bank to abandon the minimum exchange rate for the Swiss franc against the euro also had a negative impact.

Over the year as a whole, year-on-year sales fell by 13.0% to CHF 49.5 million (2014: CHF 56.9 million), this was influenced by the decline in sales at several customers. With the exception of the communications market segment, sales declined in line with the market trend. Sales generated within the communications segment actually rose, thanks to a major customer. In the printed circuit board production field, sales declined in percentage terms less sharply than in the thin-films and micro-assembly field. The AMS Division recorded an EBIT of CHF –4.4 million (2014: CHF 2.3 million) after restructuring costs from consolidating the Cicorel SA site in Moudon with the Boudry site. Before restructuring costs, the operating result at the EBIT level was CHF –0.2 million and CHF 4.9 million at the EBITDA level (2014: CHF 7.6 million).

MARKET ENVIRONMENT

STRATEGIC POSITIONING IN THE HIGH-TECH FIELD The market strategy of the AMS Division, which specializes in technological high-end applications with a focus on the mar-ket segments of medical, industry, aerospace, and defense, will be rigorously maintained. Thanks to the unique set-up of the production sites in the fields of microelectronics and thin-films, with state-of-the-art machinery that also includes clean-room fittings, as well as the combination of processes and materials using thin-film and printed circuit board technologies, the AMS

Division is ideally positioned to develop innovative applications with combined technologies for various highly demanding ap-plications in the focus market segments.

The Group is optimistic about the industry market seg-ment, driven by current megatrends such as e-mobility, minia-turization of electronic devices and components, as well as the expansion of the broadband network. These trends are boosting demand for innovative PCB systems and solutions. The division is expected to profit in particular from its high development expertise in the fields of interconnect devices, microelectronics, and assembly. In this regard, with its high-end applications, the market sees the AMS Division as the technology leader, par-ticularly when it comes to the development of such products.

The AMS Division remains dependent on individual projects and large customers. In addition, the printed circuit board market is highly fragmented. For this reason, the stra-tegic focus of the AMS Division on high-end applications and technologically challenging solutions plays a crucial role. Close cooperation on the development side, as well as in re-spect of the protection of intellectual property, is often the decisive competitive factor. Here too, the AMS Division has established itself on the market as a proven and trustworthy business partner.

The strength of the Swiss franc has already been kept in check by the efficiency rises initiated. The watches and con-sumer goods market segment is again likely to contract or stag-nate in 2016. Demand for high-quality printed circuit boards in the high-end field will rise and these will be produced in Europe and in the USA.

OUTLOOK

FOCUS ON IMPROVING PROFITABILITY The new projects acquired in the year 2015 will begin to gener-ate sales during the 2016 financial year and these will have a positive impact on the results. The focus on high-end projects within the customer portfolio will continue to be pursued rigorously, and the technology leadership will continue to be extended. The AMS Division will concentrate on technological-ly challenging niches in Europe and in the USA. Considerable potential for this challenging and profitable field is also to be found in the medical, aerospace, and defense market segments. The turnaround will be achieved and the Division will return to the path of growth by concentrating on strengths and main-taining a clear focus on leading-edge technologies.


22 Cicor | Financial Report 2015 | Corporate Governance

2_Cicor_GB15_Coporate_Governance_en.indd 22 03.03.2016 15:18:48

Cicor | Financial Report 2015 | Corporate Governance 23

CORPORATE GOVERNANCE

24 Group structure and shareholders24 Capital structure26 Board of Directors29 Group Management30 Compensation, shareholdings and loans30 Shareholders’ rights30 Changes of control and measures31 Auditors31 Information policy



1. GROUP STRUCTURE AND SHAREHOLDERS

Cicor Technologies Ltd. is committed to meeting the high stan-dards of Corporate Governance that seek to balance entrepre-neurship, control and transparency whilst ensuring efficient decision-making processes.

This report explains how the management and control of the Company are organized and provides background infor-mation on the Group’s executive officers and bodies, effective 31 December 2015. The report complies with the SIX Swiss Exchange Directive on Information relating to Corporate Gov-ernance. In addition, the report considers Cicor Technologies Ltd.’s Articles of Incorporation as well as the Company’s orga-nization regulation.

In the following Corporate Governance Report, the terms “Cicor” and “Company” shall be used alternatively to “Cicor Technologies Ltd.” and the term “Group” for the company and its subsidiaries.

1.1 GROUP STRUCTURECicor Technologies Ltd. is registered in Boudry, Switzerland, and is operationally organized into the AMS and ES Divisions. Cicor Technologies Ltd. is the parent company and is listed on the SIX Swiss Exchange.

Market capitalization as of 31 December 2015 CHF 73.1 Mio.

Security symbol CICN

Security number 870 219

ISIN CH008702190

Without consideration of the treasury shares, see section 2.1.An overview on the Group’s affiliated companies is shown on page 51.

1.2 PRINCIPAL SHAREHOLDERSThe following shareholdings correspond to the ones reported according to the regulations of the Swiss Stock Exchange (SIX Swiss Exchange) and updated as in the shares register per year-end:

31.12.2015 31.12.2014

SharesTotal

in %* SharesTotal

in %*

HEB Swiss Investment AG, Zurich, Switzerland 848 375 29.25 848 375 29.33

Quaero Capital (vormals ARGOS Funds), Luxembourg 145 000 5.00 145 000 5.01

Escatec Holdings Ltd. Port Vila, Vanuatu 141 061 4.86 141 061 4.88

* in % of the total outstanding shares of the company

Cicor Technologies Ltd. has received no notice of any sharehold-ers’ agreement regarding its shares.

As of 31 December 2015, a total of 950 (previous year 1 061) shareholders with voting rights were registered in the share register of Cicor Technologies Ltd.

1.3 CROSS-SHAREHOLDINGSCicor Technologies Ltd. has no cross-shareholdings with any other company exceeding a reciprocal 3% of capital or voting rights.

2. CAPITAL STRUCTURE

2.1 ORDINARY CAPITAL As of 31 December 2015, the ordinary share capital of Cicor Technologies Ltd. is CHF 29 020 920 divided into 2 902 092 fully paid-in registered shares with a par value of CHF 10 each.

As of 31 December 2015, the Company held 1 500 (pre-vious year 1 500) of its own shares as “Treasury Shares”. For a detailed description, please refer to section 18 of the notes to the consolidated financial statements.

2.2 AUTHORIZED AND CONDITIONAL CAPITAL

Authorized capitalAt the Shareholders’ Meeting at 24 April 2014, the shareholders decided to renew the authorization of the Board of Directors to increase the share capital by a maximum of 600 000 fully paid-in shares at a nominal value of CHF 10 until 24 April 2016.

Conditional capitalAt the Shareholders’ Meeting of 13 May 2009, the shareholders decided to increase the conditional share capital up to 200 000 fully paid-in registered shares with a total nominal value up to CHF 2 000 000 for the exercise of stock option rights granted to officers and other key employees under an employee stock option plan established by the Board of Directors.

As of 31 December 2015, according to the stock option plans approved by the Board of Directors on 3 January 2008, 3 January 2009 and 26 November 2009, 21 793 options (previ-ous year 35 793) were outstanding.

At the Shareholders’ Meeting of 13 May 2009, the shareholders decided to create additional conditional share capital of up to 500 000 fully paid-in registered shares with a total nominal value of up to CHF 5 000 000 for the exercise of conversion rights granted to holders of convertible debt secu-rities to be issued by the company. Such conversion rights would have to be exercised within five years of the issuance of such convertible debt securities.



2.3 CHANGES IN CAPITALDuring 2015, the Company’s share capital was increased by CHF 100 000 from the previous CHF 28 920 920 to CHF 29 020 920 by issuing 10 000 (2014: 11 584) registered shares from conditional capital with a par value of CHF 10 for the ex-ercise of stock options.

Ordinary capital 31.12.2015 31.12.2014 31.12.2013

Registered shares 2 902 092 2 892 092 2 880 508

Ordinary share capital (in CHF) 29 020 920 28 920 920 28 805 080

Authorized share capital

Authorized shares 600 000 600 000 600 000

Authorized share capital (in CHF) 6 000 000 6 000 000 6 000 000

Conditional share capital

Conditional shares 620 670 630 670 642 254

Conditional share capital (in CHF) 6 206 700 6 306 700 6 422 540

Further information about changes in capital for the last two years can be found on pages 64 and 75/76.

2.4 SHARES AND PARTICIPATION CERTIFICATES

With the exception of the shares held by the Company it s elf, each ordinary share is entitled to the same share in the Com-pany’s assets and profits and bears one voting right at the Annual Shareholders’ Meeting, provided the shareholder is registered with voting rights in the Company’s share register.

Provided that a shareholder does not request the print-ing and delivery of share certificates for their investment, the shares of the Company are held in collective deposit at SIX SAG AG rather than issued as physical certificates. At the re-quest of some shareholders, the Company has issued a number of physical certificates.

As of 31 December 2015, the Company has not issued any participation certificates.

2.5 PROFIT-SHARING CERTIFICATESAs of 31 December 2015, the Company has not issued any profit-sharing certificates.

2.6 LIMITATIONS ON TRANSFERABILITY AND NOMINEE REGISTRATIONS

All shares of Cicor Technologies Ltd. are registered shares and freely transferable without any limitation. Entry in the Com-pany’s share register with voting rights requires evidence that the shares have been transferred for ownership or beneficial interest. There are no registration provisions for nominees. The share register is kept by the SIX SAG AG.

2.7 CONVERTIBLE BONDS AND WARRANTS/OPTIONS

The Company has not issued any convertible bonds or similar equity-linked debt instruments as of 31 December 2015.

Based on the Company’s conditional capital (see sec-tion 2.2 “Authorized and conditional capital”), a first stock op-tion plan for members of the management was established on 3 January 2008. Under this plan (Plan 1), a total of 22 500 call options on shares were allotted to members of the Group Man-agement and certain other key employees. An option is the right to buy one share at a price of CHF 78 during the exercise period. The options are granted free of charge. One third of the options may be exercised as from one year after the grant date, i.e. after 3 January 2009; another third of the options may be exercised as from two years after the grant date, i.e. after 3 January 2010; the last third of the options may be exercised as from three years after the grant date, i.e. after 3 January 2011. The exercise period has ended seven years after the grant date, i.e. on 3 January 2015. None of the options have been exercised.

A second stock option plan for members of the manage-ment has been established on 3 January 2009. Under this plan (Plan 2), a total of 18 500 call options on shares were allotted to the members of the Group Management and certain other key employees. An option is the right to buy one share at a price of CHF 32 during the exercise period. The options were granted free of charge. One third of the options may be exercised as from one year after the grant date, i.e. after 3 January 2010; another third of the options may be exercised as from two years after the grant date, i.e. after 3 January 2011; the last third of the options may be exercised as from three years after the grant date, i.e. after 3 January 2012. The exercise period ends seven years after the grant date, i.e. on 3 January 2016. To date, 11 330 (2014: 11 330) options have been exercised.

A third stock option plan for executive directors and members of management was established on 26 November 2009. Under this plan (Plan 3), a total of 99 500 call options on shares was allotted to executive directors and members of management. An option is the right to buy one share at a price of CHF 28.80 during the exercise period. The options were granted free of charge. Half of the options may be exercised as from 27 November 2009; another 25% of the options may be exercised as from one year after the grant date, i.e. as from 27 November 2010; the last 25% of the options may be exer-cised as from two years after the grant date, i.e. as from 27 November 2011. The exercise period ends seven years after the grant date, i.e. on 26 November 2016. To date, 68 000 (2014: 58 000) options have been exercised.



3. BOARD OF DIRECTORS

3.1 MEMBERS OF THE BOARD OF DIRECTORS

On 31 December 2015, the Board of Directors (Board) of the Company consisted of the following persons:

Name/position/ nationality

First election

Current term ends

Other significant board memberships

Heinrich J. Essing Chairman Non-executive, German

2009 2016 Managing Director of HEB Swiss Investment AG, Zurich, Member of the Advisory Board of HSBC Trinkaus & Burkhardt AG, Dusseldorf

Robert Demuth Non-executive, Swiss

2007 2016 None

Andreas Dill Non-executive, Swiss

2009 2016 Member of the Board of Tec-Sem Group, CEO of Evatec Advanced Technologies until 31. August 2015

Erich Haefeli Non-executive, Swiss

2015 2016 Owner and President of Mariposa Immobilien AG

3.2 OTHER ACTIVITIES AND VESTED INTERESTS

Information about other activities of the Board members in addition to their functions for Cicor Technologies Ltd. is listed in the table above. Unless otherwise described in the curriculum vitae, the non-executive members of the Board do not have any material business connections with the Group.

3.3 ELECTIONS AND TERMS OF OFFICEAccording to the Company’s Articles of Incorporation, the Board consists of one or more members. The members of the Board as well as the Chairman of the Board are elected by the Annual Shareholders’ Meeting for a term of office of one year. There are no limits as to how many times a member can be re-elected, or any upper age limit for election.

According to the Company’s Articles of Incorporation, at least one member must be domiciled in Switzerland.

3.4 INTERNAL ORGANIZATIONAL STRUCTURE

The Board constitutes itself at its first meeting after the Annual Shareholders’ Meeting except for the appointment of the Chair-man of the Board and the members of the Remuneration Com-mittee. It appoints if necessary its Vice Chairman, the Presidium and the Audit Committee as well as a Secretary, who does not need to be a member of the Board. The Board meets as often as the Company’s affairs require or upon the written request of one of its members. The Board approves resolutions and holds elections with the majority of its votes.

The Board is the highest executive instance within the Group Management structure and takes responsibility of the overall governance of the Company and the Group. It oversees the management of their affairs. The basic principles regarding the definition of the areas of responsibility between the Board and the Group Management are described in section 3.5.

The Chairman of the Board of DirectorsThe Chairman heads the Meetings of the Board, the Presidium, and the Shareholders’ Meeting. He supervises the implemen-tation of the resolutions passed by the Board and coordinates the work of the Committees ensuring that the Board as a whole operates as an integrated, cohesive body. The Chairman of the Board of Directors is Heinrich J. Essing.

The Presidium The Presidium consists of the Chairman of the Board and up to two additional designated Board members. The following members have been appointed to the Presidium: – Heinrich J. Essing, Chairman – Robert Demuth, Vice Chairman

It is the first priority of the Presidium to supervise the duties and functions undertaken by the CEO and CFO as well as the other members of the Group Management and to act as an intermediary between the Board and the officers entrusted with the management of the Group. The Presidium takes decisions on financial and other matters delegated by the Board in ac-cordance with the Regulations regarding the Delegation of Management. In particular, the Presidium is responsible for: – preparing resolutions of the Board and overseeing their im-plementation where this function is not carried out directly by the CEO or by a Committee of the Board;

– planning for the replacement of outgoing members and evaluating candidates for positions on the Board;

– proposing to the Board for approval the members of the Com-mittees of the Board, the members of the Presidium, the CEO, the CFO, the members of the Group Management;

– appointing members to the Boards of subsidiaries and appointing the Unit Managers proposed by the CEO;

– discharging other duties in the area of Corporate Gover nance, where such duties are not assigned to a Committee or Com-mittee of the Board under the revised Regulations;



Heinrich J. Essing, ChairmanBorn 1949, has acted as private secretary and manager of various family offices for more than 20 years. He is currently CEO of HEC Group and of its subsidiaries in Germany and abroad like Sydney or Toronto. Heinrich J. Essing also acts as managing director of HEB Swiss Investment AG which is one of the Company’s larger sharehold-ers. Heinrich J. Essing is also a member of the Board of Directors of HSBC Trinkhaus & Burkhardt AG, Düsseldorf.

Robert Demuth, Vice ChairmanBorn 1947, holds a degree in mechanical engineering (dipl. Ing. HTL Maschinenbau) from the Hochschule für Technik & Archi-tektur Luzern as well as an Ex-ecutive MBA from the University of St. Gall. Robert Demuth started his career with Rieter before being appointed head of R&D of Bühler AG. Robert Demuth then served as CEO and delegate of Dyconex AG, a Swiss company active in the field of high-tech PCBs, MCMs and electronic inter-connection technology. From 2005 to 2007, Robert Demuth held executive functions within the Group. Robert Demuth is owner of the Consulting Company Robert Demuth Industrial Invest-ment Management.

Andreas DillBorn 1954, graduated as an electrical engineer (MEng) from the ETH Zurich. He started his professional career in the semiconductor industry at Zevatech AG where he took on various re sponsibilities from R+D engineer to General Manager. From 1998 to 2015, Andreas Dill has worked in various management positions at the Oerlikon Corporation, last as CEO of the Advanced Technologies Segment and a member of the Oerlikon executive committee. Andreas Dill is the owner of the Consulting Company Andreas Dill Strategic Business Consulting. He is also a board member of Tec-Sem Group.

Erich HaefeliBorn 1950, studied law at the University of Zurich. For many years, he headed the legal and patent department of OC Oerlikon Balzers AG and was also a mem-ber of the company’s Executive Management. In addition, he served on the Board of Directors of many firms in the Oerlikon-Bührle Group, which is today the indus-trial group Oerlikon. Erich Haefeli is owner and President of Mariposa Immobilien AG.

– supervising and performing the ad hoc and regular informa-tion requirements, especially under the SIX Swiss Exchange regulations and guidelines;

– approving expenditures, investments or divestments of property, plant and equipment whose total value exceeds CHF 0.5 million. In case of investments and divestments whose total value exceeds CHF 2 million, the Presidium sub-mits a report and a proposal to the full Board.

In addition, the Presidium assists the Board on matters relating to finance, investment and capital assets, and in evaluating risks pertaining thereto. It prepares proposals on such issues for a vote by the Board. Specifically, the Presidium reviews: – financial planning, budgets and budget execution; – investments of liquid assets and financial investments, including investments of assets by the Company’s postem-ployment benefit plans;

– long-term business plans and strategy as well as their communication in the Company’s annual reports;

– reporting of non-operational results.

The Presidium also makes decisions and takes preliminary action on behalf of the full Board in urgent cases.

Audit CommitteeThe Audit Committee consists of three Board members elected by the Board of Directors. The following members have been appointed: – Robert Demuth, Chairman – Andreas Dill – Erich Haefeli

The Audit Committee assists the Board in supervising the management of the Company, particularly with respect to financial and legal matters as well as in relation to compliance with internal business policies and codes of practice.



Remuneration CommitteeIn accordance with the Articles of Incorporation, Cicor has a Remuneration Committee that consists of three members of the Board of Directors, who are elected individually by the Annual Shareholders’ Meeting. The following members have been elected: – Andreas Dill, Chairman – Heinrich J. Essing – Robert Demuth

The roles and responsibilities of the Remuneration Committee are defined in detail by the Board of Directors. More information on their duties is provided in the Compensation Report.

Operating methods of the Board, the Presidium and the CommitteesBetween 1 January and 31 December 2015, the Board met for eight ordinary Board meetings as well as three phone conferences. The CEO and/or the CFO of the Group attended all meetings. On a selective basis, external advisors also participated in some meetings on specific subjects. The meetings of the Board lasted on average six hours. For each Board meeting, the members were provided with adequate material in advance to prepare for the items on the agenda. At each ordinary meeting, the CEO or the CFO presented the results of Cicor Technologies Ltd. and its segments in detail. The members discussed the results comprehensively and, if required, instructed the CEO or the CFO to take necessary actions or to draw up plans for measures.

In 2015, the Presidium held three meetings. The Audit Committee held three meetings in 2015. The

CFO of the Group participated in each conference. In addition, these meetings were attended by the Head of External Audit. The meetings lasted on average two hours.

The Remuneration Committee held three meetings in 2015. The meetings lasted on average two hours.

3.5 DEFINITION OF AREAS OF RESPONSIBILITY

The duties and responsibilities of the Board, the Presidium and the Group Management are defined as follows:

The Board holds the ultimate decisionmaking authority and decides on all matters which have not been reserved for or conferred upon another governing body of the Company by law, the Articles of Incorporation or Regulations regarding the Delegation of Management of the Company.

The Board has the following nontransferable and indefeasible duties in particular: – overall governance of the Company and the Group, including formulating medium and longterm strategies, planning priorities and laying down guidelines for corporate policy;

– approving the annual Group budgets and medium to long term Group business and investment plans;

– establishing the basic organizational structure; – defining the guidelines for accounting, financial controlling and financial planning systems;

– taking decisions on transactions of substantial strategic significance;

– appointing and removing those responsible for managing the Company’s affairs and acting as its agent, in particular the members of the Presidium, the CEO, the CFO, the Executive Vice President of the Divisions and other members of the Group Management;

– appointing and removing the members of the Committees of the Board (Remuneration Committee is elected by the Annual Shareholders’ Meeting);

– overall supervision of the bodies and officers responsible for the management of the Company;

– drawing up the annual and interim reports, preparing the Annual Shareholders’ Meeting;

– notifying the court in the event of overindebtedness; – proposing and implementing capital increases and amend ing the Articles of Incorporation;

– checking the professional qualifications of the external Group auditors.

The Board conferred management functions in the manner provided by the organizational regulation to the CEO, the Group Management or the Executive Vice President of the Divisions. Thereby, it follows the Company’s general principle accord ing to which all executive bodies and officers delegate their duties and powers to the hierarchically lowest possible body or officer that possesses the knowledge and expertise necessary to make appropriate decisions. The transferable supervisory and representative functions of the Board are delegated to the Presidium. The Operational Group Management is responsible for the daytoday operational business of the Group. Its main duties consist of: – conducting daytoday business of the Group in compliance with the applicable laws, Articles of Incorporation, regulations and instructions;

– implementing the Group strategy; – preparing and executing the resolutions of the Board and ensuring their Groupwide implementation;

– reporting all matters to be dealt with by the Board, the Presidium and the Committees;

– accounting and analyzing of the monthly results and semiannual and annual accounts on Group and divisional levels as well as implementing the required internal control measures.



3.6 INFORMATION AND CONTROL INSTRUMENTS TOWARDS THE GROUP MANAGEMENT

The Board receives annotated key data of all segments within the framework of a Group-wide institutionalized reporting system. The format of the data is defined within a MIS (Man-agement Information System).

Each month, the Management Information System sum-marizes in a simplified format the most important key figures of all operational units; every quarter, it presents comprehensive financial statements in line with the requirements set for the year-end. These reports are available to the Group Management in full length and in a condensed format to the Board of Directors.The Board analyzes such data in detail in its meetings. At each ordinary meeting of the Board and the Presidium, the CEO and the CFO inform on the operational day-to-day business and all important business events. The members of the Board, the Presidium and the Board Committees are entitled to request information on all Company-related issues. See section 3.4 for additional information on the work methods of the Board, the Presidium and the Committees.

In addition to the above described Management Infor-mation System, a Risk Management System was introduced in 2008. More detailed information is given on page 68.

4. GROUP MANAGEMENT

4.1 MEMBERS OF THE GROUP MANAGEMENT

The members of the Group Management are appointed by the Board upon proposal by the Presidium. The Group Management consists of the CEO, the CFO and the Executive Vice Presidents. As of 31 December 2015, the Group Management consisted of the following persons:

Name/nationality Position Appointment

Dr. Jürg Dübendorfer Swiss CEO June 2015

Patric Schoch Swiss CFO July 2012

Jürgen Steinbichler German

Executive Vice President AMS Division August 2015

Erich Trinkler Swiss

Executive Vice President ES Division August 2011

Dr. Jürg DübendorferBorn 1968, holds a Master of Science ETH in Physics and ob-tained his PhD at the University of Freiburg, Switzerland. In addition, he also obtained an MBA from the Rochester-Bern Executive MBA Program. He has 20 years of experience in the industry and has generated excellent results in various management positions. His professional career includes 12 years at Tecan, where in his last function he was the Executive Vice President of the Product Development & Operations division until 2012. Before joining Cicor, he was CEO of Sauser Management AG, a holding company that has interests in various firms, in particular in Bamotec AG, which operates in outsourcing and supply chain management of complex mecha-tronic structural components and equipment for the industrial and medical products sector.

Patric SchochBorn 1972, Patric Schoch is a senior international CFO, with a proven international career in finance as a controller or CFO for major business units and regions of international companies. Patric Schoch has many years of experience in working in the industry, including living and working for more than ten years in South East Asia, Taiwan and China. He joined Cicor Group as interim CFO end of July 2012 and became permanent CFO per 1 April 2013. From December 2012 to Mai 2015 Patric Schoch was also acting CEO of the Group. Patric Schoch is part owner of the interim & management consulting company FS Partners AG, Herisau, in which he serves as a Board member.

Jürgen SteinbichlerBorn 1962, gained his degree in mechanical engineering at the Regensburg University of Applied Sciences. He has a wealth of technological expertise in semiconductors and electronics as well as many years of professional experience from his various leadership roles at international companies such as Siemens, ESEC and Dyconex. Before joining Cicor as Division Head AMS, Jürgen Steinbichler held a range of management roles at Tecan.

Erich Trinkler Born 1962, he completed his degree as an electrical engineer at the University of Applied Sciences Rapperswil in 1991 and earned an Executive MBA at the University of Applied Sciences HTW Chur from 2009 through 2011. After completing his degree in electrical engineering, he spent several years in the development of fiber testing systems in the textile industry as a group and project manager. He has more than 15 years of experience as a key account manager and head of sales at an Electronic and Engineering Manufacturing Services (E2MS) company with about 400 employees. Erich Trinkler joined the Cicor Group as executive Vice President ES Division in August 2011.



4.2 OTHER ACTIVITIES AND VESTED INTERESTS

No member of the Group Management held a position outside the Cicor Technologies Group which could be of significance to the Company.

4.3 MANAGEMENT CONTRACTSCicor Technologies Ltd. delegated no management duties to legal entities or natural persons outside the Company in 2015.

5. COMPENSATION, SHAREHOLDINGS AND LOANS

This information is provided in the Compensation Report.

6. SHAREHOLDERS’ RIGHTSEach registered share of the Company entitles the owner/ben-eficiary of the share to one vote at the Shareholders’ Meeting, provided that he is registered in the share register of the Com-pany as a shareholder with voting rights.

6.1 VOTING RIGHTS AND REPRESENTATION RESTRICTIONS

There are no statutory restrictions on voting rights. All share-holders, provided that they are registered in the share register of the Company as shareholders with voting rights, have the same right to attend the Shareholders’ Meeting or to be repre-sented by a legal representative or, with written authorization, by another person or by the independent voting proxy.

6.2 STATUTORY QUORUMThe Shareholders’ Meeting passes its resolutions with the absolute majority of the votes allocated to the shares repre-sented. If a second ballot is required, the relative majority of the votes allocated to the shares represented is sufficient for the adoption of an agenda item. In the event of equality of votes, the Chairman has the casting vote. According to the Articles of Incorporation, a resolution of the Shareholders’ Meeting passed by at least two thirds of the votes represented and the absolute majority of the par value of shares represented are required for: – changing the purpose of the Company; – introducing shares with privileged voting rights; – limiting the transferability of registered shares; – increasing authorized or conditional share capital; – increasing share capital out of equity, against contributions in kind or for the purpose of acquisition of assets and grant-ing special benefits;

– limiting or withdrawing preemptive rights; – changing the domicile of the Company; – dissolving the Company.

6.3 CONVOCATION OF THE SHAREHOLDERS’ MEETING

Shareholders’ Meetings are convened by the Board and, if required, by the Auditors at the latest 20 days before the date of the meeting. The Annual Shareholders’ Meeting is held at the latest within six months of the close of the financial year. Shareholders registered in the share register with voting rights representing an aggregate of at least 10% of the share capital may request in writing, setting forth the items to be discussed and the proposals to be decided, that an extraordinary Share- holders’ Meeting is convened.

The Company publishes the invitation to the Sharehold-ers’ Meeting in the “SOGC”, as well as in other publications as decided by the Board of Directors. Simultaneously, the written invitation is sent to the shareholders or beneficiaries who are entered in the share register of the Company.

The invitation contains details of the day, time and place of the meeting as well as the agenda and the proposals of the Board and the shareholders who have requested the Sharehold-ers’ Meeting or an item to be included on the agenda.

6.4 AGENDAShareholders registered in the share register with voting rights, whose combined shareholdings represent an aggregate nominal value of at least CHF 1 million, may request that an item be included in the agenda of a Shareholders’ Meeting. Such a request shall be made in writing at least 60 days before the meeting and shall specify the items and motions to be included in the agenda.

6.5 ENTRY INTO THE SHARE REGISTERThe SIX SAG AG keeps the Company’s share register which contains the names and addresses of shareholders and the number of shares they have registered. After dispatch of the invitation to the Shareholders’ Meeting, no entries can be made in the share register until the day after the Shareholders’ Meeting has taken place.

7. CHANGES OF CONTROL AND MEASURES

7.1 DUTY TO MAKE AN OFFERThe Company does not have an opt-in or opt-out clause in its Articles of Incorporation, meaning that the mandatory bid obligation of the Swiss Stock Exchange Act is triggered if a shareholder or a group of shareholders acting in concert acquire more than one third of the outstanding shares of the Company.

7.2 CLAUSES ON CHANGES OF CONTROLAs of 31 December 2015, there are no specific clauses included in agreements and schemes benefitting members of the Board or Group Management in the event of a change of control situation.



8. AUDITORS

8.1 DURATION OF THE MANDATE AND TERM OF OFFICE OF THE LEAD AUDITOR

The Annual Shareholders’ Meeting elects the auditors for a term of one year. On 23 April 2015, the General Meeting mandated KPMG, Cicor Technologies Ltd.’s Group auditor since 2007, for an additional year. KPMG or a subsidiary of the KPMG Group audits the consolidated and statutory financial statements. The auditor in charge since 2014 of the current mandate is Roman Wenk.

8.2 AUDITING FEESDuring the year under review, KPMG charged a total of TCHF 264 (previous year TCHF 257) for their services in connec-tion with the auditing of consolidated and statutory financial statements.

8.3 ADDITIONAL FEESKPMG AG additionally received fees of TCHF 6 (previous year: TCHF 11) for other services to the Company.

8.4 SUPERVISORY AND CONTROL INSTRUMENTS PERTAINING TO THE AUDIT

The Audit Committee supervises and controls on behalf of the Board of Directors the performance and independence of the external auditors. It determines the targets of the audit and assesses the work of the external auditors and their fees. In addition, it reviews the audit result and monitors the implementation of the findings by the Management.

In 2015, the Audit Committee and the external auditors met once to plan the auditing of the financial statements of the Group and its subsidiaries. In a second meeting, these statements, as well as the corresponding “Management Letter” formulated by external auditors, were reviewed and discussed in detail with the Audit Committee. In total, the Audit Committee had three meetings in the presence of the external auditors.

9. INFORMATION POLICYFor the benefit of its shareholders and the public interested in the business activities of the Company, Cicor Technologies Ltd. pursues an open and transparent information policy. In terms of periodical as well as ad hoc reporting, the Company aims to guarantee equal treatment with respect to time as well as to content. The Company has a clear policy to prevent insider dealings. The corresponding guidelines contain provisions re-garding the handling of confidential information to which all persons concerned within and outside of the Company are subject, as well as clear instructions regarding time and form of the respective publication.

From internal availability to approval of the semi-annual or annual results by the Board, the Company and its management refrain from communicating to the investing public any qualitative and quantitative statements and information which might give an indication as to the expected sales or results. After the Board meeting, in which the semi-annual and annual reports are approved, the general public is informed in summary about the course of business by means of an ad hoc announcement.

Furthermore, the Company informs its shareholders, the media, financial analysts and other interested parties by using the following publications and channels: – Annual and Interim Reports in accordance with Swiss GAAP FER;

– presentation of annual results; – Shareholders’ Meeting; – press releases as well as publications of share price-sensi-tive facts (ad hoc publicity).

The 2016 General Shareholders’ Meeting will be held on 19 April 2016. The Interim Report is planned to be published on 17 August 2016.

For additional information about Cicor Technologies Ltd. and its subsidiaries, please visit the Group’s website (www.cicor.com). Inter alia, previous annual reports and press releases can be found on the website.

Responsible for investor relations are Heinrich J. Essing, Chairman, and Jürg Dübendorfer, CEO, phone +41 43 811 44 05, [email protected].


32 Cicor | Remuneration Report

3_Cicor_GB15_Vergütungsbericht_en.indd 32 03.03.2016 15:19:22

Cicor | Remuneration Report 33

REMUNERATION REPORT

34 Introduction34 Remuneration system35 Approval process 36 Remuneration during the year under review37 Remuneration during the previous year37 Payments to related parties37 Loans39 Report of the statutory auditor on

the Remuneration Report



1. INTRODUCTIONThis Remuneration Report details Cicor’s remuneration policy, covering all key elements and general principles, and outlines the responsibilities with regard to planning, approval framework and implementation. It also contains detailed information on the remuneration of the Board of Directors and the Group Management for financial years 2014 and 2015.

This Remuneration Report meets the requirements of the Swiss Ordinance against Excessive Compensation in Listed Stock Companies (Verordnung gegen übermässige Vergütun- gen bei börsenkotierten Aktiengesellschaften, VegüV, which r e places article 663bis by the corresponding VegüV provisions) and Article 5 of the Annex to the Directive on Information Relat-ing to Corporate Governance (Corporate Governance Directive, DCG) of the SIX Swiss Exchange dated 1 September 2014, as well as the recommendations in Art. 38 “Compensation report and transparency” of Appendix 1 to the Swiss Code of Best Practice for Corporate Governance of economiesuisse.

2. REMUNERATION SYSTEM

Principles of remuneration The remuneration paid to members of the Group Management may comprise three components: – fixed basic remuneration; – variable performance-related compensation; – individual allocation of company shares.

Members of the Board of Directors have no executive duties and receive a fixed salary, plus any compensation due to them for the performance of special duties that exceed the usual scope of their mandate.

Basic remuneration The basic remuneration for the members of the Group Man-agement may comprise a monthly salary, a lump sum for enter-tainment and car expenses, other benefits as per individual agreement, and the relevant social security contributions. Other benefits as per individual agreement include contributions to professional development.

The monthly salary is determined on a discretionary basis, taking into account the individual’s duties, amount of responsibility, qualifications and experience required, as well as the actual external market environment in relation to the entire remuneration system for the senior management of the Group.Members of the Board of Directors receive a fixed salary, which is dependent on their function and committee memberships.

Variable compensationMembers of the Group Management are entitled to a variable salary component. If the defined targets are met or exceeded, the CEO receives a variable salary component worth up to 130% of his base salary, while the other members of the Group Management receive up to 80% of their base salary. The

achievement of targets, and thus the amount of the variable salary component, is determined once a year following the approval and publication of the Cicor Group’s Annual Report. The variable performance-related compensation is paid in cash only and is based on: – individual targets (30–60%, depending on the function) – the achievement of predefined operative and/or financial key figures (40–70%)

For the CEO and other members of the Group Management, operative key figures have been defined as targets like growth in net sales, achievement of the budgeted operative result (EBIT) and free cash flow for the Group as a whole as well as for the relevant Division. Individual targets are based on stra-tegic and operative parameters agreed following the budgeting process and strategy meeting and approved at the beginning of the year.

Cicor does not provide members of the Group Manage-ment or Board members with a company vehicle.

Long-term participation plansIn 2008 and 2009, Cicor paid to members of the Group Man-agement as well as certain employees in key positions an addi-tional, performance-related remuneration on top of the variable salary component. The objective of this remuneration in form of an allocation of call options is to increase the long-term commitment of these key employees to the Company and its success. The call options entitle holders to buy Cicor shares at a predefined price, subject to certain blocking periods. The existing plans of 2008 and 2009 carried blocking periods of two respectively three years and can be exercised within seven years. As per 31 December 2015, all options of Plan 2 and Plan 3 can be exercised.

Employment contracts and special benefitsNo member of the Group Management has an employment contract with a notice period of more than 12 months. None of these employment contracts involve any severance payments.

Number of external mandates and functionsAccording to the Articles of Incorporation, Board members may not have or perform more than three mandates in other listed companies and not more than 15 in non-listed companies. Members of the Group Management may not have or perform more than one mandate in another listed company and not more than three in non-listed companies.

Mandates or employment relationships with associated companies outside the Cicor Group that entail sitting on a man-agement or administrative body or a function in executive man-agement are deemed a single mandate under this provision.



3. APPROVAL PROCESSThe remuneration system and the remuneration of the Group Management are established by the Remuneration Committee in consultation with the CEO and submitted to the Board of Directors for approval. The processes and responsibilities within Cicor are organized as follows:

CEOThe Group CEO supports the Remuneration Committee by pro-posing for discussion: – the conditions of employment contracts for the Group Man-agement and senior management members;

– the individual target achievement for the variable salary com-ponent at the beginning of the year, and

– new targets to be determined for the current financial year for the Group Management and senior management.

Remuneration CommitteeThe Remuneration Committee comprises three Board members. It currently consists of: – Andreas Dill, Chairman – Heinrich J. Essing – Robert Demuth

The Remuneration Committee reviews, evaluates and submits for approval to the entire Board: – the conditions and remuneration set out in the employment contracts of the CEO, CFO and other members of the Group Management;

– the total remuneration for the members of the Group Management and senior management members, including the achievement of individual targets for variable compen-sation for the past financial year at the beginning of the year, as well as new targets to be set for the current financial year;

– remuneration guidelines; – the introduction of performance-related remuneration sys-tems, including the introduction of share and option-based remuneration systems;

– changes in pension schemes; – additional benefits for employees; – remuneration of the Board of Directors; – compensation for additional duties of Board members; – compensation for the various Board committees.

Board of DirectorsThe Board of Directors decides on all matters that are not, ac-cording to the law, Articles of Incorporation or organizational regulations, explicitly entrusted to another governing body of the Company. In particular it approves, upon request by the Remuneration Committee: – the conditions and remuneration set out in the employment contracts of the CEO, CFO and other members of Group Man-agement;

– total remuneration for members of Group Management and senior management, including variable compensation;

– remuneration guidelines; – the introduction of performance-related remuneration sys-tems, including the introduction of share and option-based remuneration systems;

– changes in pension schemes; – additional benefits for employees; – remuneration of the Board of Directors; – compensation for additional duties of Board members; – appointment of members to the various Board committees, except the members of the Remuneration Committee, as well as their remuneration.

Annual Shareholders’ MeetingThe Annual Shareholders’ Meeting prospectively votes on the approval of the total remuneration amounts for the Board of Directors and the Group Management once a year. In addition, it can hold a consultative vote on the full remuneration report.If, after the remuneration has been prospectively approved by the Annual Shareholders’ Meeting, the Group Management is expanded or a member of Group Management is promoted or replaced, there is, compliant to the Articles of Incorporation, an additional amount available. Such additional amount may not exceed 30% of the previously approved total compensation amount per remuneration period and per member promoted or replaced.



4. REMUNERATION DURING 2015Remuneration is reported in accordance with the principle of accrual.

Board of DirectorsBoard members receive a fixed salary, paid in cash, as well as any compensation due to them for the performance of special duties that exceed the usual scope of their office.

in CHF 1 000 Remu- neration

Bonus Pension fund

Social security contributions

Other Consul- tancy

fee

Total

Heinrich J. Essing 58 – – – – 17 75

Robert Demuth 40 – – 3 – 15 58

Andreas Dill 30 – – 5 – 1 36

Erich Haefeli 1) 21 – – – – – 21

Total current Board members 149 – – 8 – 33 190

Antoine Kohler 2) 20 – – 3 – – 23

Hans Knöpfel 2) 9 – – – – – 9

Total former Board members 29 – – 3 – – 32

Total current and former Board members 178 – – 11 – 33 222

No other payments, services, payments in kind, premiums, guarantees or compensation were awarded.

1) Member of the Board of Directors since 23 April 20152) Member of the Board of Directors until 23 April 2015

Group Management


Bonus Pension fund


Other Consul- tancy

fee

Total

Total current Management 846 323 99 77 15 – 1 360

Of which highest single compensation paid to:

Patric Schoch 3) 300 87 31 25 – – 443

Total former Management 205 64 13 27 17 – 326

Total current and former Management 1 051 387 112 104 32 – 1 686


3) Remuneration for five months as acting CEO and CFO of the Group.



5. REMUNERATION DURING 2014

Board of Directors


Bonus Pension fund


Other Consul- tancy

fee

Total

Antoine Kohler 68 – – 11 – – 79

Heinrich J. Essing 42 – – – – 19 61

Robert Demuth 42 – – 4 – 9 55

Andreas Dill 32 – – 5 – – 37

Hans Knöpfel 32 – – – – – 32

Total current Board members 216 – – 20 – 28 264


Group Management

in CHF 1000 Remu- neration

Bonus Pension fund


Other Consul- tancy

fee

Total

Total current Management 732 277 72 76 36 – 1 193

Of which highest single compensation paid to:

Patric Schoch 300 157 22 29 – – 508

Total former Management 244 77 20 19 – – 360

Total current and former Management 976 354 92 95 36 – 1 553


6. PAYMENTS TO RELATED PARTIESNo persons close to the Board of Directors or the Group Management were granted any loans of any kind, nor did they receive any remuneration at all.

7. LOANSCicor does not grant loans to Board members or to members of the Group Management.



We have audited the accompanying remuneration report dated 8 March 2016 of Cicor Technologies Ltd. for the year ended 31 December 2015. The audit was limited to the information according to articles 14–16 of the Ordinance against Excessive compensation in Stock Exchange Listed Companies contained in the sections 4 to 7 on pages 36 to 37 of the remuneration report.

Responsibility of the Board of DirectorsThe Board of Directors is responsible for the preparation and overall fair presentation of the remuneration report in accor-dance with Swiss law and the Ordinance against Excessive com-pensation in Stock Exchange Listed Companies (Ordinance). The Board of Directors is also responsible for designing the remu-neration system and defining individual remuneration packages. Auditor’s ResponsibilityOur responsibility is to express an opinion on the accompanying remuneration report. We conducted our audit in accordance with Swiss Auditing Standards. Those standards require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether the remuneration report complies with Swiss law and articles 14–16 of the Ordinance.

An audit involves performing procedures to obtain audit evidence on the disclosures made in the remuneration report with regard to compensation, loans and credits in accordance

with articles 14–16 of the Ordinance. The procedures selected depend on the auditor’s judgment, including the assessment of the risks of material misstatements in the remuneration report, whether due to fraud or error. This audit also includes evaluating the reasonableness of the methods applied to value components of remuneration, as well as assessing the overall presentation of the remuneration report.

We believe that the audit evidence we have obtained is suffi-cient and appropriate to provide a basis for our opinion.

OpinionIn our opinion, the remuneration report for the year ended 31 December 2015 of Cicor Technologies Ltd complies with Swiss law and articles 14–16 of the Ordinance.

Zurich, 8 March 2016 KPMG AG

Roman Wenk Simon WidmerLicensed Audit Expert Licensed Audit ExpertAuditor in Charge

REPORT OF THE STATUTORY AUDITOR ON THE REMUNERATION REPORT TO THE GENERAL MEETING OF SHAREHOLDERS


40 Cicor | Financial Report 2015 | Consolidated Financial Statements

4_Cicor_GB15_Finanzteil_1_en.indd 40 03.03.2016 15:19:44

FINANCIAL REPORT

CONSOLIDATED FINANCIAL STATEMENTS OF THE CICOR TECHNOLOGIES GROUP

Consolidated balance sheetConsolidated income statement Consolidated cash flow statementConsolidated statement of changes in equityNotes to the consolidated financial statementsReport of the statutory auditor on the consolidated financial statements

FINANCIAL STATEMENTS OF CICOR TECHNOLOGIES LTD.

Balance sheetIncome statementNotes to the financial statementsReport of the statutory auditor on the financial statements

424344454671

72737478

Cicor | Financial Report 2015 | Consolidated Financial Statements 41



CONSOLIDATED BALANCE SHEET

in CHF 1 000 Notes 31.12.2015 in % 31.12.2014 in %

Assets

Property, plant and equipment (5) 45 041 29.8 50 477 33.6

Intangible assets (6) 787 0.5 1 066 0.7

Deferred tax assets (11) 4 082 2.7 3 572 2.4

Non-current assets 49 910 33.0 55 115 36.7

Inventories (7) 41 459 27.4 42 127 28.1

Trade accounts receivable (8) 27 791 18.4 30 869 20.6

Income tax receivable 4 0.0 37 0.0

Other accounts receivable (8) 3 685 2.4 3 983 2.6

Prepaid expenses and accruals 784 0.5 993 0.7

Cash and cash equivalents (9) 27 681 18.3 17 006 11.3

Current assets 101 404 67.0 95 015 63.3

Total assets 151 314 100.0 150 130 100.0

Liabilities and shareholders’ equity

Ordinary share capital 29 022 19.2 28 922 19.3

Share premium 113 455 75.0 114 308 76.1

Treasury shares –37 –0.0 –37 –0.0

Retained earnings –80 575 –53.3 –76 593 –51.0

Translation reserve –2 324 –1.5 533 0.3

Equity attributable to Cicor shareholders 59 541 39.4 67 133 44.7

Non-controlling interests 159 0.1 306 0.2

Total equity 59 700 39.5 67 439 44.9

Long-term provisions (10) 2 875 1.9 2 016 1.4

Deferred tax liabilities (11) 902 0.6 1 219 0.8

Long-term financial liabilities (12) 43 668 28.9 32 780 21.8

Liabilities for post-employment benefits (13) 1 652 1.1 1 306 0.9

Other long-term liabilities 12 0.0 44 0.0

Non-current liabilities 49 109 32.5 37 365 24.9

Short-term financial liabilities (12) 4 547 3.0 5 459 3.6

Trade accounts payable 21 831 14.4 23 658 15.8

Other current liabilities (14) 6 514 4.3 6 912 4.6

Accruals (14) 6 233 4.0 7 010 4.7

Short-term provisions (10) 3 278 2.2 1 979 1.3

Income tax payable 102 0.1 308 0.2

Current liabilities 42 505 28.1 45 326 30.2

Total liabilities 91 614 60.5 82 691 55.1

Total equity and liabilities 151 314 100.0 150 130 100.0

General remark to the notes of the consolidated financial statements: Unless otherwise stated all amounts in CHF 1 000

CONSOLIDATED FINANCIAL STATEMENTS



CONSOLIDATED INCOME STATEMENT

in CHF 1 000 Notes 2015 in % 2014 in %

Net Sales (4) 180 612 100.0 202 458 100.0

Change in inventory of finished and unfinished goods 5 0.0 1 577 0.8

Material costs –89 466 –49.5 –103 482 –51.1

Personnel costs (21) –56 889 –31.5 –58 820 –29.1

Other operating income 1 181 0.7 2 101 1.0

Other operating expenses (23) –23 326 –12.9 –24 172 –11.9

Restructuring costs (10) –4 718 –2.6 – 0.0

Depreciation (5) –8 702 –4.8 –8 788 –4.3

Amortization (6) –349 –0.2 –645 –0.3

Operating loss/profit (EBIT) –1 652 –0.9 10 229 5.1

Financial income (24) 5 504 3.0 4 844 2.4

Financial expenses (24) –7 663 –4.2 –6 115 –3.0

Loss/profit before tax (EBT) –3 811 –2.1 8 958 4.4

Income tax (11) –245 –0.1 –1 952 –1.0

Net loss/profit –4 056 –2.2 7 006 3.5

Attributable to:

– Cicor shareholders –3 982 6 896

– Non-controlling interests –74 110

Earnings per share (CHF)

– basic (19) –1.37 2.39

– diluted (19) –1.37 2.38



CONSOLIDATED CASH FLOW STATEMENT

in CHF 1 000 Notes 2015 2014

Loss/profit before tax –3 811 8 958

Depreciation (5) 8 702 8 788

Impairment (10) 3 463 –

Amortization (6) 349 645

Interest income (24) –57 –178

Interest expenses (24) 1 767 1 775

(Gain)/loss on disposal of assets –41 –86

Increase/(decrease) in provisions 934 –174

Increase/(decrease) in other non-current liabilities –29 –2

Unrealized currency (gains)/losses 507 –298

Subtotal before working capital changes 11 784 19 428

Decrease/(increase) in inventories –986 –890

Decrease/(increase) in trade accounts receivable 859 –966

Decrease/(increase) in other current assets 1 227 1 228

(Decrease)/increase in trade accounts payable 157 2 519

(Decrease)/increase in other current liabilities –3 413 –744

(Increase)/decrease in working capital –2 156 1 147

Income tax paid –788 –901

Interest paid –881 –1 541

Interest received 57 178

Net cash from operating activities 8 016 18 311

Purchase of property, plant and equipment (5) –8 453 –10 618

Proceeds from sale of property, plant and equipment 45 268

Purchase of intangible assets (6) –153 –154

Net cash used in investing activities –8 561 –10 504

Proceeds from issue of share capital 288 335

Payment to shareholders from capital contribution reserves –1 041 –866

Payment of finance lease liabilities 84 –814

Proceeds from borrowings 15 943 3 418

Repayment of borrowings –3 536 –7 798

Net cash from/(used in) financing activities 11 738 –5 725

Currency translation effects –518 –445

Net increase/(decrease) in cash and cash equivalents 10 675 1 637

Cash and cash equivalents at the beginning of the period (9) 17 006 15 369

Cash and cash equivalents at the end of the period (9) 27 681 17 006



CONSOLIDATED STATEMENT OF CHANGES IN EQUITY

in CHF 1 000 Share capital

Share premium

Treasury shares

Retained earnings

Translation reserve

Equity attributable

to Cicor shareholders

Non- controlling

interest

Total equity

Balance at 1 January 2014 28 806 114 955 –37 –83 489 – 60 235 258 60 493

Net profit 6 896 6 896 110 7 006

Dividend/capital contribution paid to shareholders –866 –866 –866

Capital increase for the established stock option plans 116 219 335 335

Translation adjustment 533 533 –62 471

Balance at 31 December 2014 28 922 114 308 –37 –76 593 533 67 133 306 67 439

in CHF 1 000 Share capital

Share premium

Treasury shares

Retained earnings

Translation reserve

Equity attributable

to Cicor shareholders

Non- controlling

interest

Total equity

Balance at 1 January 2015 28 922 114 308 –37 –76 593 533 67 133 306 67 439

Net loss –3 982 –3 982 –74 –4 056

Dividend/capital contribution paid to shareholders –1 041 –1 041 –1 041

Capital increase for the established stock option plans 100 188 288 288

Translation adjustment – –2 857 –2 857 –73 –2 930

Balance at 31 December 2015 29 022 113 455 –37 –80 575 –2 324 59 541 159 59 700



1. CORPORATE INFORMATIONCicor Technologies Ltd., Boudry, is a public company, the shares of which are traded on the Swiss Stock Exchange (SIX).

Cicor Group offers a seamless production and service chain for electronic components and systems – from develop-ment and engineering to large-scale manufacturing, after-sales service and product lifecycle management. Mainly active in Europe, the USA and Asia, Cicor’s main competences are: – Manufacture of PCBs and HDIs – rigid, rigid-flexible and flexible

– Hybrid manufacturing (thin/thick film, RF boards) – Quick turn prototypes, small, medium and large series – Microassembly (SMD, wire bonding, flip chip, etc.) – Packaging – Outsourcing services for the manufacture of electronic mod-ules, component groups and complete electronic products (EMS: Electronic Engineering and Manufacturing Services)

2. BASIS OF THE CONSOLIDATED FINANCIAL STATEMENTS

2.1 BASIS OF PREPARATION

Statement of complianceThe consolidated financial statements of the Cicor Group are based on uniform accounting and valuation principles applica-ble to all subsidiaries of the Group. The consolidated financial statements have been prepared in accordance with Swiss GAAP FER (GAAP = Generally Accepted Accounting Principles / FER = Fachempfehlungen zur Rechnungslegung) and the require-ments of the Swiss Code of Obligations.

The consolidated financial statements of Cicor Group for the year ended 31 December 2015 were authorized for issue on 8 March 2016 and are subject to approval at the Shareholders’ Meeting of 19 April 2016.

Conversion to Swiss GAAP FEROn 20 February 2015, the Board of Directors decided to change the Group’s financial reporting standard to Swiss GAAP FER with effect from 1 January 2015. Up to 31 December 2014, Cicor Technologies had prepared its interim and annual financial statements in accordance with the International Financial Reporting Standards (IFRS), which have been applied since 1998. The switch to Swiss GAAP FER was performed in retro-spect from 1 January 2014. The consolidated financial state-ments 2015 of Cicor have been prepared for the first time in accordance with Swiss GAAP FER. The change to Swiss GAAP

FER marks a decision for a more pragmatic standard of com-parative informational value that meets the requirements of an international, medium-sized company while being less complex and thus reducing costs. The application of Swiss GAAP FER continues to guarantee transparent reporting in accordance with the principle of true and fair view.

The accounting principles applied in the preparation and presentation of the 2015 consolidated financial statements de-viate in the following essential points from the consolidated annual financial statements for 2014 prepared according to IFRS:

Goodwill from acquisitionsUnder IFRS, goodwill was capitalized, not amortized but tested for impairment annually. Swiss GAAP FER 30 ”Consolidated financial statements“ gives the option of either offsetting the goodwill as at the acquisition date with equity, or capitalizing and amortizing it, usually over five years, in justified cases over 20 years at the most. Cicor decided to capitalize goodwill and depreciate it over the recommended period by Swiss GAAP FER of five years. Most of the goodwill is already fully amortized at 1 January 2014, Cicor’s date of transition to Swiss GAAP FER.

Employee benefit obligationsUnder IFRS (IAS 19), the pension plans of Cicor Technologies in Switzerland and in Germany qualify as defined benefit plans. The calculation was performed annually by a qualified actuary using the projected unit credit method. The net obligation with respect to defined benefit plans was calculated separately for each plan by estimating the amount of future benefit that em-ployees have earned in return for their service and deducting the fair value of plan assets. By contrast Swiss GAAP FER 16 stipulates that a provision only needs to be recognized, if an economic obligation exists and the conditions for the forma-tion of a provision are met, e.g. to cover a underfunding. For the calculation of the pension cost and the surplus or deficit, the financial statement of the pension plans drawn up in ac-cordance with Swiss GAAP FER 26 should be used. Employer contribution reserves are recognized as assets. Cicor dissolved all obligations except the ones for Reinhardt Microtech GmbH and RHe Microsystems GmbH.

Intangible assetsUnder IFRS, brand names, customer relationships and technol-ogies acquired in a business combination were separately cap-italized and amortized over their estimated useful economic lives as part of the purchase price allocation. Intangible assets with an infinite lifespan, however, were not depreciated on a

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS



regular basis under IFRS (impairment only approach). Under Swiss GAAP FER, the amortization period is 20 years at most (even if the lifespan is infinite). Cicor will depreciate intangible assets for which the useful life cannot be clearly determined over the period recommended by Swiss GAAP FER of five years. Intangible assets include capitalized development costs. If the capitalization criteria were fulfilled, it was a requirement by IFRS to capitalize these costs. Swiss GAAP FER however permits an option as to whether capitalize or immediately recognize the development costs as expense. Cicor will continue to capitalize all development costs if the conditions of FER 10 are met, and depreciate these assets over a period of five years.

Deferred income taxesThe above-mentioned valuation and balance sheet adjustments have consequences for deferred income taxes in the balance sheet and income statement.

Presentation and structureThe presentation and structure of the balance sheet, income statement, statement of changes in equity and the cash flow statement were adjusted to meet the requirements of Swiss GAAP FER. The previous periods were reported as required under Swiss GAAP FER. As a result of the first time adoption of Swiss GAAP FER, accumulated translation differences are offset with retained earnings as of 1 January 2014. The implications of the above-mentioned adjustments for equity and the net profit of Cicor Technologies are summarized in the table below:

until the date that control ceases. A list of all subsidiaries is disclosed in note 3. Cicor does not hold any subsidiaries, in-vestments, assets or liabilities which are not fully consolidated within the financial statements of the Cicor Group.

Upon the loss of control the Group derecognizes the assets and liabilities of the subsidiary, any non-controlling interests and the other components of equity related to the subsidiary. Any surplus or deficit arising on the loss of control is recognized in profit or loss.

Non-controlling interests in equity and profit are shown separately. Changes in the Group’s interest that do not result in a loss of control are accounted for as equity trans-actions. The carrying amounts of the Group’s interests and the non-controlling interests are adjusted to reflect the changes in their relative interests in the subsidiaries. Any difference between the amount by which the non-controlling interests are adjusted and the fair value of the consideration paid or received is recognized directly in equity and attributed to owners of the Group. Intercompany balances, transactions and profits are eliminated on consolidation.

in CHF 1 000 1.1.2014 31.12.2014

Equity according to IFRS 125 853 125 602

Intangible assets –79 567 –78 805

Liability for post-employment benefits 14 043 22 230

Deferred tax –100 –1 852

Translation adjustment 264 264

Equity according to Swiss GAAP FER 60 493 67 439

1.1.–31.12.2014

Net profit according to IFRS 6 202

Depreciation/Amortization of Intangible assets 810

Personnel costs –168

Interest costs 358

Deferred tax –196

Net profit according to Swiss GAAP FER 7 006

Basis of measurementThe consolidated financial statements have been prepared on an accrual basis under the historical cost convention except for de-rivative financial instruments which are measured at fair value.

Presentation currencyThe consolidated financial statements are presented in Swiss francs (CHF).

2.2 SIGNIFICANT ACCOUNTING PRINCIPLES

Basis of consolidationThe consolidated financial statements comprise the financial statements of Cicor Technologies Ltd. and all subsidiaries which the parent company, directly or indirectly, controls either by holding more than 50% of the voting rights or by otherwise having the power to govern their operating and financial poli-cies. These subsidiaries are fully consolidated. The financial statements of subsidiaries are included in the consolidated financial statements from the date that control commences



Purchase methodAcquisitions of subsidiaries and businesses are accounted for using the purchase method. The consideration paid plus directly attributable transaction costs for each acquisition are eliminat-ed at the date of acquisition against the fair value of the net assets acquired, determined based on uniform accounting policies. Any excess of the consideration transferred over the net assets acquired is recognized as goodwill. Goodwill is amor-tized over five years.

Foreign currency conversionTransactions in foreign currencies are converted at the rate of exchange as of the transaction date. Gains and losses from for-eign currency transactions and from converting year-end foreign currency balances are recognized in the income statement.

Foreign exchange differences on long-term loans to foreign operations with equity characteristics, where a repay-ment is neither likely nor planned, are recognized in equity.

The financial statements of subsidiaries that report in foreign currencies are translated into Swiss francs as follows: – balance sheet items: at year-end exchange rates – income statement and cash flow statement items: at average exchange rates for the year

– Equity is translated at historical rates

The translation differences resulting from the conversion of financial statements denominated in foreign currencies are directly charged to equity. At the date of sale of a foreign sub-sidiary, the respective cumulative foreign currency translation differences are recognized in profit or loss.

Foreign exchange rates 2015 2014

Closing EUR 1.0807 1.2027

USD 0.9891 0.9899

RON 0.2386 0.2680

SGD 0.6996 0.7484

CNY 0.1523 0.1618

Average EUR 1.0680 1.2146

USD 0.9623 0.9152

RON 0.2403 0.2733

SGD 0.7001 0.7222

CNY 0.1545 0.1489

Segment informationSegment information presented is based on the internal report-ing regularly provided to the Board of Directors. This reporting includes discrete financial information for the two divisions AMS and ES which were identified as the two segments of the Group.

Property, plant and equipmentItems of property, plant and equipment are individually measured at cost less accumulated depreciation and accumulated impairment losses. Depreciation is computed on a straight-line basis over the estimated useful life of the assets as follows:

Land*

Buildings 25–50 years

Improvements max 10 years

Machinery 3–10 years

Furniture 5–15 years

Equipment 3–10 years

Vehicles 4 years

* Land is not depreciated as it is deemed to have an indefinite life.

When parts of an item of property, plant and equipment have different useful lives, they are accounted for as separate items (major components) of property, plant and equipment.

Subsequent expenditure is capitalized if the market value or the value in use or the useful live of the respective item of property, plant and equipment has increased substantially.

GoodwillGoodwill represents the excess of the consideration transferred over the Group’s interest in the net of the identifiable assets acquired and the liabilities assumed measured at fair value. Subsequently, goodwill is measured at cost less accu-mulated amortization and accumulated impairment losses. Goodwill is amortized over five years, in justified cases over 20 years at the most.

Other intangible assetsOther intangible assets are measured at cost less accumulated amortization and accu mulated impairment losses. Amortization is computed on a straight-line basis over the estimated useful life of the asset (normally 5 years, in justified cases over 20 years at the most).



Impairment of assetsProperty, plant and equipment as well as intangible assets are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of the asset may not be recoverable. If such indication exists, then the as-set’s recoverable amount is estimated.

An impairment loss is recognized in profit or loss when the carrying amount of an asset exceeds its estimated recover-able amount. The recoverable amount of an asset or a group of assets is the greater of its value in use and its net selling price. In assessing value in use, the estimated future cash flows from continuing use of an asset or a group of assets that are largely independent of cash flows of other assets are discounted to their present value using a pre-tax discount rate that reflects current market assessments of the time value of money and the risks specific to the asset. The relevant cash flows are based on the most recent business plans of these cash-generating units (period of three years) and the assumptions therein concerning development of prices, markets and market shares. Assets for which an impairment loss was recognized are reviewed at each reporting date for any indications that the loss has decreased or no longer exists. An impairment loss is re versed only if there has been a change in the estimates used to determine the recover able amount. The reversal is limited to the amount that would have been determined, net of depreciation or amortiza-tion, if no impairment had been recognized. Such reversal is recognized in profit or loss. Impairment losses on goodwill are not reversed.

Impairment losses recognized in respect of cash-gen-erating units are allocated first to reduce the carrying amount of any goodwill allocated to the units and then to reduce the carrying amounts of the other assets in the unit (group of units) on a pro rata basis.

Leasing agreementsFixed assets acquired under leasing contracts where both the risks and rewards of ownership are substantially transferred to Cicor, are classified as finance leases. Such assets are recorded at the lower of the estimated net present value of future lease payments and the estimated fair value of the asset at the inception of the lease. Assets under finance leases are fully amortized over the shorter of the lease term and its useful life. The corresponding lease obligations, ex cluding finance charges, are included in either short or long-term financial debt. Lease installments are divided into an interest and a redemption com-ponent.

Operating lease payments are recognized as an expense in profit or loss on a straight-line basis over the lease term.

InventoriesInventories are valued at the lower of purchase or manufac-turing costs and fair value less cost to sell. Costs for raw ma-terial are measured according to the weighted average cost method. Cost of work-in-progress and finished goods include materials, related manufacturing labor and related overheads. Concerning work-in-progress, estimated losses correspond to the negative difference between the fair value less cost to sell and the estimated costs until finalization of work-in-progress.

Trade accounts receivableTrade accounts receivable are measured at nominal value less necessary allowances for bad debts. The Group establishes an allowance for impairment that represents its estimate of incurred losses in respect of trade accounts receivables. The main com-ponents of this allowance are a specific loss component that relates to individually significant exposure, and a collective loss component established for groups of assets with similar risk characteristics in respect of losses that have been incurred but not yet identified. The collective loss allowance is determined based on historical data of payment statistics for similar receiv-ables.

Cash and cash equivalentsCash and cash equivalents are stated at amortized costs and include cash on hand, postal and bank accounts at sight and time deposits with maturities at the balance sheet date of 90 days or less.

Bank borrowings, trade and other liabilitiesNon-derivative financial liabilities are initially recognized at fair value less any attributable transaction costs and are subse-quently measured at amortized cost.

ProvisionsProvisions are recognized when – the Group has a present legal or constructive obligation as a result of past events

– it is probable that resources are needed to extinguish the obligation

– the amount of the obligation can be estimated in a reliable way.

A provision is recognized for expected warranty claims on products sold during the last two years, based on past experi-ence of the level of repairs and returns.



Government grantsGovernment grants are recognized as income over the periods matching the related costs, which they are intended to com-pensate on a systematic basis. Government grants are only recognized when there is reasonable assurance that the com-pany will comply with the conditions attached to them and that the grants will be received. Income taxesIncome tax is recognized in profit or loss except to the extent that it relates to items recognized directly in equity, in which case it is recognized in equity. Current income taxes are ac-crued based on taxable income of the current year. The tax rates and tax laws used to compute the amount are those that are enacted or substantially enacted at the reporting date. Deferred income tax assets and liabilities are recognized for all temporary differences between the tax and accounting bases of assets and liabilities at the reporting date using the liability method.

Deferred income taxes are measured at the tax rates that are expected to apply in the period when the asset is re-alized or the liability is settled.

Deferred tax assets arising from tax loss carry-forwards and deductible temporary differences are capitalized only if it is probable that they can be used to be offset against future taxable profits.

Derivative financial instrumentsDerivative financial instruments are stated at fair value, and gains and losses are reported in the financial result.

Pension plansCicor maintains several pension plans for employees in Swit-zerland and Germany. A liability is recognised if a pension plan has an underfunding and there is an economic obligation for Cicor to pay additional contribution. The assessment of whether there is an obligation is made using the recognition criteria for provisions. For Swiss plans, the measurement of the liability is based on the financial statements of the pension plan prepared in accordance with FER 26, and for German plans, this is based on an actuarial calculation. An asset arising from an economic benefit relating to an overfunding is not recognized. Employer contribution reserves are always recognized as an asset.

Changes in the economic obligation, the employer con-tribution reserves and the contributions incurred for the period are recognized in Personnel costs in the income statement.

Earnings per shareBasic earnings per share are calculated by dividing net profit excluding non-controlling interests by the weighted average number of shares outstanding during the reporting period. Diluted earnings per share include all potentially dilutive effects.

Treasury sharesWhen share capital is repurchased, the amount of the con-sideration paid, which includes directly attributable costs, is recognized net of any tax effects as a deduction from capital reserves. Repurchased shares are classified as treasury shares and are presented as a deduction from total equity. When trea-sury shares are sold or reissued subsequently the resulting gain or loss on the transaction is recognized in capital reserves.

Share-based paymentsThe grant date fair value of options granted to employees is recognized as an employee expense, with a corresponding increase in equity, over the period that the employees become unconditionally entitled to the options. The amount recognized as an expense is adjusted to reflect the number of share options for which the related service and performance conditions are expected to be met such that the amount ultimately recognized is based on the number of options that are going to meet the related service and performance condition at the vesting date, if any.

Revenue recognitionRevenue from the sale of products comprises all revenues that are derived from sales of products to third parties after deduc-tion of price rebates and value-added tax. Revenues from the sale of products are recognized when the significant risks and rewards of ownership of the goods have passed to the buyer, usually on delivery of the products.

Revenues from engineering and consulting services are recognized in the accounting period in which the services are rendered.

Research and development costsResearch costs are expensed as incurred. An intangible asset arising from development expenditure on an individual project is recognized only when a future benefit is expected, costs can be measured reliably, the asset is controlled by the organization and the resources needed to complete the asset are/will be made available. Additionally, the Group has to demonstrate the technical feasibility, the availability of resources and its intention of completing the project so that it will be available for use or sale.

Capitalized development cost is measured at cost less accumulated amortization and accumulated impairment losses.



3. SCOPE OF CONSOLIDATION

in local currency 1 000 Currency 2015 Nominal share capital

Participation in %

2014 Nominal share capital

Participation in %

Cicorel SA, Boudry/Switzerland* CHF 8 000 100 8 000 100Engineering/Production/Sales/Distribution

Reinhardt Microtech AG, Wangs/Switzerland* CHF 1 800 100 1 800 100Engineering/Production/Sales/Distribution

Reinhardt Microtech GmbH, Ulm/Germany EUR 500 75 500 75Engineering/Production/Sales/Distribution

RHe Microsystems GmbH, Radeberg/Germany* EUR 216 100 216 100Engineering/Production/Sales/Distribution

Electronicparc Holding AG, Bronschhofen (Wil)/Switzerland* CHF 23 271 100 23 271 100Holding/Finance

Swisstronics Contract Manufacturing AG, Bronschhofen (Wil)/Switzerland

CHF 3 000 100 3 000 100

Engineering/Production/Sales/Distribution

Systronics SRL, Arad/Romania RON 5 145 100 5 145 100Production

Systel Italia SRL, Milano/Italy EUR 10 100 10 100Sales/Distribution

ESG Holding Pte Ltd., Singapore* SGD 1 896 100 1 896 100Holding/Finance

Cicor Asia Pte Ltd., Singapore SGD 1 000 100 1 000 100Sales/Distribution

Cicor Ecotool Pte Ltd., Singapore SGD 1 000 100 1 000 100Engineering/Production

PT Cicor Panatec, Batam/Indonesia USD 300 100 300 100Production

Brant Rock Enterprises Corporation, British Virgin Islands USD 10 100 10 100Holding/Finance

Cicor Anam Ltd., Anam/Vietnam USD 1 500 100 1 500 100Production

Suzhou Cicor Technology Co. Ltd., China CNY 34 798 100 23 507 100Production

Cicor Americas Inc., USA USD 10 100 10 100Sales/Distribution

Cicor Management AG, Zurich/Switzerland* CHF 250 100 250 100Management Services

* Directly held subsidiaries of Cicor Technologies Ltd.



4. SEGMENT REPORTING

2015 in CHF 1 000

AMS Division 2015

ES Division 2015 Total reportable segments

2015

Corporate and eliminations

2015

Consolidated 2015

Income statement

Sales to external customers 49 508 131 342 180 850 –238 180 612

Intersegment sales 2 236 238 –238 –

Segment result before depreciation and amortization (EBITDA) 642 8 930 9 572 –2 173 7 399

Segment result (EBIT) –4 440 5 136 696 –2 348 –1 652

Balance sheet 31.12.2015 31.12.2015 31.12.2015 31.12.2015 31.12.2015

Intangible segment assets 650 18 668 119 787

Other than intangible segment assets 59 577 82 228 141 805 8 722 150 527

Total assets 60 227 82 246 142 473 8 841 151 314

Segment liabilities 60 666 57 912 118 578 –29 964 91 614

Other segment information 2015 2015 2015 2015 2015

Depreciation and amortization 4 952 3 794 8 746 305 9 051

Capital expenditures for property, plant and equipment 4 059 4 394 8 453 – 8 453

2014 in CHF 1 000

AMS Division 2014

ES Division 2014 Total reportable segments

2014

Corporate and eliminations

2014

Consolidated 2014

Income statement

Sales to external customers 56 934 145 524 202 458 – 202 458

Intersegment sales – 138 138 –138 –

Segment result before depreciation and amortization (EBITDA) 7 594 13 912 21 506 –1 844 19 662

Segment result (EBIT) 2 283 10 025 12 308 –2 079 10 229

Balance sheet 31.12.2014 31.12.2014 31.12.2014 31.12.2014 31.12.2014

Intangible segment assets 838 63 901 165 1 066

Other than intangible segment assets 66 239 80 245 146 484 2 580 149 064

Total assets 67 077 80 308 147 385 2 745 150 130

Segment liabilities 60 391 55 909 116 300 –33 609 82 691

Other segment information 2014 2014 2014 2014 2014

Depreciation and amortization 5 311 3 887 9 198 235 9 433

Capital expenditures for property, plant and equipment 6 535 4 083 10 618 – 10 618

Cicor defines its reportable segments based on the internal reporting to its Board of Directors. They base their strategic and operational decisions on these monthly distributed reports, which include the aggregated financial data for the Group and for the Divisions. The two divisions, AMS and ES, have been identified as the two reportable segments. The AMS Division supplies printed circuit boards and thin/thick-film-coating technologies as well as a wide range of microelectronic man-ufacturing capabilities to different industries whereas the ES

Division provides electronic manufacturing services from prod-uct development to volume production and after-sales service.

For internal reporting, and therefore the segment reporting, the applied principles of accounting and valuation are the same as in the consolidated financial statements. Intersegment sales are recognized at arm’s length.



in CHF 1 000 2015 2014

Reconciliation of total reportable segment result

Total reportable segment result (EBIT) 696 12 308

Other corporate expenses –2 348 –2 079

Financial income 5 504 4 844

Financial expenses –7 663 –6 115

Consolidated profit before tax –3 811 8 958

Other corporate expenses contain stewardship costs and costs related to the listing at the Swiss Stock Exchange (SIX).

Entity-wide information

2015 in CHF 1 000

Switzerland 2015

Germany 2015

Other 2015

Total 2015

Sales to external customers (attributed to the entity's country of domicile) 98 576 15 803 66 233 180 612

31.12.2015 31.12.2015 31.12.2015 31.12.2015

Other non-current assets 20 474 11 307 14 047 45 828

2014 in CHF 1 000

Switzerland 2014

Germany 2014

Other 2014

Total 2014

Sales to external customers (attributed to the entity's country of domicile) 111 178 20 200 71 080 202 458

31.12.2014 31.12.2014 31.12.2014 31.12.2014

Other non-current assets 28 728 11 226 11 589 51 543

Other non-current assets contain property, plant and equipment and intangible assets.

in CHF 1 000 31.12.2015 % 31.12.2014 %

Sales by destination

Switzerland 72 097 39.9 79 425 39.2

Europe (without Switzerland) 63 155 35.0 73 204 36.2

Asia 31 658 17.5 35 008 17.3

North America 11 537 6.4 13 798 6.8

Other 2 165 1.2 1 023 0.5

Total 180 612 100.0 202 458 100.0

Sales by industry

Aerospace & defence 14 881 8.2 17 921 8.9

Communication 16 596 9.2 18 245 9.0

Industrial 54 100 30.0 54 953 27.1

Medical 48 473 26.8 56 663 28.0

Automotive & transport 16 332 9.0 22 980 11.4

Watches & consumer 22 117 12.2 23 252 11.5

Other 8 113 4.6 8 444 4.1

Total 180 612 100.0 202 458 100.0

Major customersCicor Group’s biggest customer contributes less than 8% (2014: less than 7%) to the Group’s consolidated sales. In 2015, about 45% (2014: about 43%) of total Group’s net sales can be attributed to the Group’s top ten clients.



5. PROPERTY, PLANT AND EQUIPMENT

2015 in CHF 1 000

Land and buildings

Machinery Furniture and equipment

Other equipment

Total

Acquisition costs

Balance at 1 January 2015 29 482 92 264 11 073 2 187 135 006

Additions 530 6 802 1 064 57 8 453

Disposals –9 –4 565 –26 –13 –4 613

Translation adjustment –684 –2 283 –428 –129 –3 524

Balance at 31 December 2015 29 319 92 218 11 683 2 102 135 322

Accumulated depreciation

Balance at 1 January 2015 –13 145 –62 203 –7 355 –1 826 –84 529

Depreciation –1 602 –5 869 –1 054 –177 –8 702

Impairment –134 –3 078 – – –3 212

Disposals 9 4 133 17 13 4 172

Translation adjustment 197 1 462 228 103 1 990

Balance at 31 December 2015 –14 675 –65 555 –8 164 –1 887 –90 281

Net book value

1 January 2015 16 337 30 061 3 718 361 50 477

31 December 2015 14 644 26 663 3 519 215 45 041

Thereof net book value of assets under financial lease – 980 – 47 1 027

Net book value of pledged assets 4 319

Addition of assets under financial lease –

In 2015, Cicor invested CHF 6.8 million in machinery in compa-nies in Switzerland, Germany, Romania and Asia. The biggest investments were undertaken in Romania where CHF 1.7 million was invested in new assembly machines (SMT SX line). In Germany, CHF 1.6 million was invested in a fully automated SMD- and Chip-Assemblyline. The remaining investment sum was spent on several minor investments in Switzerland and Asia.

The impairments are mainly due to the consolidation of the production sites of Cicorel SA (see Note 10).



2014 in CHF 1 000

Land and buildings

Machinery Furniture and equipment

Other equipment

Total

Acquisition costs

Balance at 1 January 2014 28 336 87 963 9 931 1 940 128 170

Additions 1 070 8 049 1 345 154 10 618

Disposals –207 –4 388 –127 – –4 722

Reclassifications –28 28 –99 99 –

Translation adjustment 311 612 23 –6 940

Balance at 31 December 2014 29 482 92 264 11 073 2 187 135 006


Balance at 1 January 2014 –11 559 –60 344 –6 585 –1 483 –79 971

Depreciation –1 696 –5 877 –982 –233 –8 788

Disposals 207 4 247 89 – 4 543

Reclassifications – – 121 –121 –

Translation adjustment –97 –229 2 11 –313

Balance at 31 December 2014 –13 145 –62 203 –7 355 –1 826 –84 529

Net book value

1 January 2014 16 777 27 619 3 346 457 48 199

31 December 2014 16 337 30 061 3 718 361 50 477

Thereof net book value of assets under financial lease – 1 116 – – 1 116

Net book value of pledged assets 6 193

Addition of assets under financial lease –

In 2014, Cicor invested CHF 8.0 million in machinery at compa-nies in Switzerland, Germany, Romania and Asia. Of this, CHF 3.1 million was invested in one site in Switzerland to increase its leading position as manufacturer of high demanding printed circuit boards with ultra-fine lines. Investments included a state-of-the-art laser direct imaging (LDI) system, delivering the highest imaging accuracy and yields for today’s most com-plex IC substrate applications including Flip-Chip BGA, Flip-Chip CSP, BGA/CSP and modules manufacturing.



6. INTANGIBLE ASSETS

2015 in CHF 1 000

Goodwill Brand Technology Clients Other Total

Acquisition costs

Balance at 1 January 2015 96 188 6 711 7 743 3 617 1 264 115 523

Additions – – 23 – 130 153

Translation adjustment – – –351 –441 1 –791

Balance at 31 December 2015 96 188 6 711 7 415 3 176 1 395 114 885


Balance at 1 January 2015 –96 109 –6 711 –6 937 –3 617 –1 083 –114 457

Amortization –79 – –120 – –150 –349

Translation adjustment – – 268 441 –1 708

Balance at 31 December 2015 –96 188 –6 711 –6 789 –3 176 –1 234 –114 098

Net book value

1 January 2015 79 – 806 – 181 1 066

31 December 2015 – – 626 – 161 787

2014 in CHF 1 000

Goodwill Brand Technology Clients Other Total

Acquisition costs

Balance at 1 January 2014 95 922 6 711 7 640 3 626 1 248 115 147

Additions – – 151 – 3 154

Translation adjustment 266 – –48 –9 13 222

Balance at 31 December 2014 96 188 6 711 7 743 3 617 1 264 115 523


Balance at 1 January 2014 –95 688 –6 711 –6 625 –3 626 –930 –113 580

Amortization –157 – –344 – –144 –645

Reclassification – – – – – –

Translation adjustment –264 – 32 9 –9 –232

Balance at 31 December 2014 –96 109 –6 711 –6 937 –3 617 –1 083 –114 457

Net book value

1 January 2014 234 – 1 015 – 318 1 567

31 December 2014 79 – 806 – 181 1 066

7. INVENTORIES

in CHF 1 000 31.12.2015 31.12.2014

Net value of raw materials 21 110 21 783

Net value of work-in-progress 11 764 13 197

Net value of finished goods 8 585 7 147

Total inventories 41 459 42 127

Change in inventory allowance (+ increase / – decrease) 740 –127

The main reasons for the increase in inventory allowance are the impairment due to the restructuring in Moudon (TCHF 250, see Note 10) and an increase in an individual allowance related to one specific customer (TCHF 400).



8. TRADE ACCOUNTS RECEIVABLE AND OTHER ACCOUNTS RECEIVABLE

in CHF 1 000 31.12.2015 31.12.2014

Trade accounts receivable 28 002 31 157

Allowance for bad debts –211 –288

Total trade accounts receivable 27 791 30 869

Ageing of trade accounts receivable

in CHF 1 000 31.12.2015 Gross

31.12.2015 Allowance

31.12.2014 Gross

31.12.2014 Allowance

Not yet due 21 833 –140 24 465 –

Overdue 0–45 days 4 903 –27 5 048 –5

Overdue 46–90 days 676 –19 1 076 –61

Overdue 91–180 days 91 –3 384 –88

Overdue 181–360 days 177 –5 149 –99

Overdue more than 360 days 322 –17 35 –35

Total trade accounts receivable 28 002 –211 31 157 –288

Movement in the allowance for impairment for trade accounts receivable

in CHF 1 000 2015 2014

Individual impairment allowance

Balance as of 1 January 288 419

Allowance increase 72 28

Utilization/consumption –2 –75

Reversal of allowance –152 –84

Translation adjustments –2 –

Balance as of 31 December 204 288

Collective impairment allowance

Balance as of 1 January – –

Change in allowance 7 –

Balance as of 31 December 7 –

Other accounts receivable

in CHF 1 000 31.12.2015 31.12.2014

Receivables on bullion dealers’ accounts 746 526

Value added taxes 423 1 357

Withholding taxes – 5

Other 2 516 2 095

Total other accounts receivable 3 685 3 983



9. CASH AND CASH EQUIVALENTS

in CHF 1 000 31.12.2015 31.12.2014

Bank accounts 27 681 17 006

Total cash and cash equivalents 27 681 17 006

Cicor Technologies’ banking partners are first-rate Swiss, Ger-man, English and Romanian banks. Cash earns interests at floating rates of 0.00% (CHF); 0.00% (EUR); and 0.05% (USD).

10. PROVISIONS

2015 in CHF 1 000 Restructuring Warranties Other Total provisions Deferred taxes Total provisions and deferred

taxes

Balance at 1 January 2015 – 2 137 1 858 3 995 1 219 5 214

Additional provisions 1 217 1 454 1 284 3 955 110 4 065

Unused amounts reversed – –715 –244 –959 – –959

Amount used –16 –2 –629 –647 –427 –1 074

Translation adjustments – –91 –100 –191 – –191

Balance at 31 December 2015 1 201 2 783 2 169 6 153 902 7 055

thereof short-term provisions 1 201 1 068 1 009 3 278

thereof long-term provisions – 1 715 1 160 2 875

2014 in CHF 1 000 Restructuring Warranties Other Total provisions Deferred taxes Total provisions and deferred

taxes

Balance at 1 January 2014 – 2 140 2 160 4 300 1 599 5 899

Additional provisions – 1 578 807 2 385 17 2 402

Unused amounts reversed – –1 226 –153 –1 379 – –1 379

Amount used – –336 –981 –1 317 –396 –1 713

Translation adjustments – –19 25 6 –1 5

Balance at 31 December 2014 – 2 137 1 858 3 995 1 219 5 214

thereof short-term provisions – 811 1 168 1 979

thereof long-term provisions – 1 326 690 2 016

Warranty provisions are recognized for warranty claims on products sold. The additional provisions in 2015 were based on several smaller cases.

As per 31 December, other provisions consist mainly of jubilee benefits (2015: TCHF 781; 2014: TCHF 752) and rebuilding costs (2015: TCHF 356; 2014: TCHF 377). The increase compared to last year is mainly due to rent obligations in connection with the move to the new building in Bronschhofen (TCHF 320) and an imminent loss for an order on hand concerning a single fixed price project customer (TCHF 125).

The restructuring costs as shown in the income state-ment 2015 of TCHF 4 718 include impairments on fixed assets (TCHF 3 212) and valuation adjustments on inventory (TCHF 250), termination based benefits (TCHF 504) and other costs (TCHF 752). The costs recognized as provisions at year-end are TCHF 1 201. These restructuring costs are due to the fact that Cicor Group has decided to merge the AMS Division’s two PCB production locations in Switzerland. This move will involve consolidating the Cicorel SA location in Moudon with the loca-tion in Boudry. Cicor Group has also decided to merge the ES

Division’s customer support operation in Switzerland from its previous two locations into one joint location. As part of this measure, the Ticino sales office in Quartino will relocate to the ES Division’s headquarters in Bronschhofen and have its exist-ing competencies integrated there.



11. TAXES

Major components of tax expense in CHF 1 000 2015 2014

Current income taxes 1 099 1 566

Income tax for prior years –183 –91

Deferred tax –671 477

Total tax expense 245 1 952

Deferred tax assets and liabilities

in CHF 1 000 31.12.2015 Assets

31.12.2015 Liabilities

31.12.2014 Assets

31.12.2014 Liabilities

Deferred taxes on intangible assets – 157 4 241

Deferred taxes on property, plant and equipment 134 301 150 495

Deferred taxes on other assets 516 451 778 1 012

Deferred taxes on liabilities 544 179 976 682

Total 1 194 1 088 1 908 2 430

Deferred taxes on loss carried forward 3 074 – 2 875 –

Offset of assets and liabilities –186 –186 –1 211 –1 211

Total deferred tax assets and liabilities 4 082 902 3 572 1 219

Balance at 1 January 3 572 1 219 4 429 1 599

Change of temporary differences recognized in the income statement 310 –317 209 –380

Change in tax loss carried forward 200 –1 066 –

Balance at 31 December 4 082 902 3 572 1 219

The Group average tax rate for the calculation of the deferred income taxes is 16.5%.

Reconciliation of current income taxes and deferred taxes

in CHF 1 000 2015 2014

Loss/profit before tax –3 811 8 958

Weighted average income tax in % 9.2 % 21.0 %

Expected income tax expense/(income) –352 1 878

Current year losses for which no deferred tax asset is recognized 934 399

Recognition of tax assets on previously unrecognized tax losses –802 –71

Effects of change in losses carried forward 602 –

Effect of tax rate changes compared to prior period – 8

Effect of non-deductible expenses 13 –

Effect of tax-exempt income – –178

Adjustments for current tax of prior periods –183 –91

Other adjustments 34 7

Effective income taxes 246 1 952

Effective income taxes in % of profit/(loss) before tax –6.5 % 21.8 %



Tax loss carried forward for which no deferred tax assets have been capitalized in CHF 1 000 31.12.2015 31.12.2014

tax loss carried forward expiring within 1 year 4 231 –

tax loss carried forward expiring in 1 year 515 –

tax loss carried forward expiring in 2 years 1 398 4 951

tax loss carried forward expiring in 3 years 1 305 1 385

tax loss carried forward expiring in 4 or more years 7 893 2 939

Since the group operates in various tax jurisdictions, its average expected tax rate is calculated as a weighted average of the tax rates in these jurisdictions. This rate changes from year to year due to changes in the mix of the group’s taxable income and changes in local tax rates.

Tax losses carried forward are capitalized where the possibility of using them is high. In 2015, an additional deferred tax asset of TCHF 802 has been capitalized.

12. FINANCIAL LIABILITIES

Long-term financial liabilities

in CHF 1 000 31.12.2015 31.12.2014

Financial leases – 97

Borrowings, long-term 43 668 32 683

Total long-term financial liabilities 43 668 32 780

Short-term financial liabilities

in CHF 1 000 31.12.2015 31.12.2014

Bank overdrafts 2 016 2 601

Bank borrowings, short-term 1 945 2 104

Short-term portion of long-term borrowings 484 352

Financial leases 102 402

Total short-term financial liabilities 4 547 5 459

Maturity of financial liabilities

in CHF 1 000 31.12.2015 31.12.2014

Within 1 year 4 547 5 459

Within 2 to 5 years 43 668 32 780

Over 5 years – –

Total financial debts 48 215 38 239



Repayments of financial liabilities

2015 Interest rate 2016 2017 2018 2019 2020 2021 and after

CHF 65.0 million revolving credit line 1.9 % – 42 476 – – – –

EUR 3.0 million revolving credit line 1.6 % 2 016 – – – – –

EUR 3.4 million revolving credit line 1.7 % 2 429 420 353 299 120 –

Leasing n.a. 102 – – – – –

Total 4 547 42 896 353 299 120 –

2014 Interest rate 2015 2016 2017 2018 2019 2020 and after

CHF 45.0 million revolving credit line 1.8 % – – 32 000 – – –

EUR 1.25 million loan 2.5 % 842 – – – – –

EUR 2.0 million loan 2.3 % 1 759 – – – – –

EUR 2.71 million revolving credit lines 2.6 % 2 456 281 207 128 67 –

Leasing n.a. 402 97 – – – –

Total 5 459 378 32 207 128 67 –

On 22 December 2014, the Group signed a syndicated bank loan agreement on a total line of CHF 65 million plus an allowance of an external basket of CHF 10 million valid for three years, beginning on 19 January 2015, with two extension options of one additional year each, therefore running for a maximum term of five years.

The covenants are net debt/EBITDA ratio of a maximum of 2.5 times and a minimum equity ratio of 35% (previous year under IFRS 45%). EBITDA is calculated before restructuring costs, possible acquisitions can be added pro forma. The interest bases on LIBOR added by a margin variable depending on the net debt/EBITDA ratio. The bank covenants were fulfilled at all times.

The current CHF 65 million revolving credit line, which was divided into CHF 60 million cash and CHF 5 million for guarantees, was utilized by CHF 43 million cash at a variable interest rate of 1.85% on average and for guarantees of CHF 0.6 million bearing commission charges of 0.7%.

In addition to the syndicated loan, the Group has revolving loans of EUR 6.4 million utilized with EUR 5.2 million at an average variable interest rate of 1.3%.

Collateral assets of CHF 4.3 million were pledged. The shares of the following companies at a nominal value of CHF 36.3 million (2014: CHF 36.1 million) are in deposit with the lead bank pledged as collateral for the syndicated credit line: Cicorel SA, Electronicparc Holding AG, Swisstronics Contract Manu facturing AG, Reinhardt Microtech AG and RHe Microsystems GmbH.



13. LIABILITIES FOR POST-EMPLOYMENT BENEFITS

Cicor maintains several pension plans for employees in Switzerland and Germany. Pension expenses totaled TCHF 2 212 (2014: TCHF 2 026). German pension funds are not legally independent in contrast to Swiss pension funds. Companies therefore need to recognize a provision according to the German Commercial Code. RHe Microtech GmbH and Reinhardt Microtech GmbH did so by recognizing TCHF 893 resp. TCHF 759 as liability.

The majority of Cicor‘s insured employees are covered for the risk of old age, death and disability within two collective pension schemes which are administrating pension plans of various unrelated employers. Plan A is an independent pension fund whereas Plan B has been established by an insurance company.

Plan A:The standard retirement age for Plan A is 65. Employees qualify for early retirement on their 58th birthday at the earliest. Furthermore, the employees may choose to take their entire pension or part thereof in the form of capital payment. For retirements at the age of 65, the conversion rate is 6.8%. This rate is relevant to determine the pension payment in relation to the accumulated savings. These savings result from employee and employer contributions which are paid into the individual savings account of each individual insured person as well as the interest accruing on the accumulated savings.

Plan A has reinsured its exposure to the risks of death and disability. It is a collective multiemployer pension fund organized as a foundation under Swiss law. The most senior governing body of the foundation is the Board of Trustees that consists of an equal number of employer’s and employees’ representatives. The people entrusted with the management of the pension fund and its assets are subject to the charter of the Swiss Pension Fund Association ASIP. All processes are audited by the internal auditors and the independent external auditors

as well as the investment controller. And finally, the supervisory authority, the Zentralschweizer BVG und Stiftungsaufsicht (ZBSA), audits the management of the pension fund and the assets in collaboration with the auditors. The actual funding ratio as per 31.12.2015 is 104.3%. Whenever there is a legal obligation to cover an underfunding this has to be remedied by various measures such as increasing employee and employer contributions, lowering the interest rate on retirement account balances, reducing prospective benefits and a suspension of the early withdrawal facility.

Plan B:The standard retirement age for Plan B is 65. Employees qualify for early retirement on their 58th birthday at the earliest. Furthermore, the employees may choose to take their entire pension or part thereof in the form of capital payment. For retirements at the age of 65, the conversion rate is 6.8% for the compulsory part and between 5.24% and 5.60% for the supplementary part. The accumulated savings result from employee and employer contributions which are paid into the individual savings account of each individually insured person as well as the interest accruing on the accumulated savings. The final benefit is contributionbased with certain minimum guarantees. Plan B is legally organized as a foundation under Swiss law and has all risks reinsured under an insurance contract. The most senior governing body of the foundations is the Board of Trustees that consists of an equal number of employer’s and employees’ representatives . The reinsurance contract covers the risks of death and disability as well as the investment risk, the legally required minimum interest rate and the lifelong payment of current oldage and survivors‘ pensions, regardless of financial market performance.

The Group does not have employer contribution reserves.

in CHF 1 000 Surplus/deficit

Economical part of the organization

Change to prior year period or

recognized in the current result of the period,

respectively

Contribu-tions

concerning the

business period

Pension benefit expenses with personnel expenses

31.12.2015 31.12.2015 31.12.2014 2015 2014

Pension institutions without surplus/deficit (Plan A) – – – – 1 443 1 443 1 090

Pension institutions with surplus (Plan B) 1) – – – – 597 597 865

Pension institutions without own assets – 1 652 1 306 346 –174 172 71

Total – 1 652 1 306 346 1 866 2 212 2 026

1) The surplus of the collective pension fund attributable to Cicor cannot be determined.



14. OTHER CURRENT LIABILITIES AND ACCRUALS

in CHF 1 000 31.12.2015 31.12.2014

Value-added taxes 250 134

Other current liabilities 1 086 2 038

Other accounts payable 5 178 4 740

Total other currenct liabilities 6 514 6 912

Accrued interest 398 –

Accrued personnel expenses 2 524 2 957

Other accrued expenses 3 311 4 053

Total accruals 6 233 7 010

Total other current liabilities and accruals 12 747 13 922

Other current liabilities and accrued expenses are noninterestbearing financial liabilities.

Other accounts payable also contain payables for social security.

15. LEASE COMMITMENTS

Operating leasing

in CHF 1 000 31.12.2015 31.12.2014

within 1 year 3 199 3 029

from over 1 year to under 5 years 7 193 4 426

due in 5 years or later 19 083 2 723

Total operating leasing 29 475 10 178

Operating leasing commitments stem mostly from mid to longterm lease obligations for production and office premises. The leases have varying terms and renewal rights. Other operational leasings are for leasingfinanced cars.

For financial leasings, please refer to note 12.

16. CONTINGENT LIABILITIESThere are no contingent liabilities for Cicor Group companies as at 31 December 2015. For contingent liabilities of Cicor Technologies Ltd. refer to the notes of the financial statements (Holding) on page 78.



17. ISSUED CAPITAL

Capital structure

in CHF 1 000

Share capital at 1 January 2014 28 806

Increase of ordinary share capital of 11 584 registered shares at CHF 10 116

Share capital at 31 December 2014 28 922

Increase of ordinary share capital of 10 000 registered shares at CHF 10 100

Share capital at 31 December 2015 29 022

2 902 092 registered shares of CHF 10

Ordinary share capitalThe ordinary share capital was increased in 2015 by 10 000 shares (2014: 11 584 shares) out of conditional capital at a nominal value of CHF 10 for the established stock option plans.

Cicor Technologies Ltd. is a holding company established under Swiss law. According to the provisions of law governing the appropriation of retained earnings by holding companies, the share capital and appropriations to the general legal reserve to the extent of 20% of share capital as well as the reserve for treasury shares may not be distributed.

DividendAny dividend distribution must be proposed by the Board of Directors and approved by the Annual Shareholder’s Meeting. At the Shareholders’ Meeting of 23 April 2015, the shareholders decided to allocate TCHF 1 041 from the capital contributions to the free reserves and to distribute CHF 0.36 per share (totaling CHF 1 040 613.12) to the shareholders out of these free reserves. Due to the results in the 2015 financial year, the Board of Directors will propose to the Annual Sharholders’ meeting to forego the distribution of earnings.

Authorized capitalAt the Shareholders’ Meeting at 24 April 2014, the shareholders decided to renew the authorization of the Board of Directors to increase the share capital by a maximum of 600 000 fully paidin shares at a nominal value of CHF 10 until 24 April 2016.

Conditional capitalAt the Shareholders’ Meeting of 13 May 2009, the shareholders decided to increase the conditional share capital up to 200 000 fully paidin registered shares with a total nominal value up to CHF 2 000 000 for the exercise of stock option rights granted to officers and other key employees under an employee stock option plan established by the Board of Directors. During 2015, 10 000 (2014: 11 584) shares were issued.

As of 31 December 2015, according to the stock optionplans approved by the Board of Directors on 3 January

2008, 3 January 2009 and 26 November 2009, 21 793 options (previous year 35 793) were outstanding.

At the Shareholders’ Meeting of 13 May 2009, the shareholders decided to create additional conditional share capital of up to 500 000 fully paidin registered shares with a total nominal value of up to CHF 5 000 000 for the exercise of conversion rights granted to holders of convertible debt securities to be issued by the company. Such conversion rights would have to be exercised within five years of the issuance of such convertible debt securities.

18. TREASURY SHARES

Number of shares

in CHF 1 000

Balance as per 1 January 2014 1 500 37

Transactions of own shares – –

Balance as per 31 December 2014 1 500 37

Transactions of own shares – –

Balance as per 31 December 2015 1 500 37



19. EARNINGS PER SHAREBasic earnings per share are calculated by dividing the net profit attributable to shareholders by the weighted average number of ordinary shares outstanding during the year.

Basic earnings per share

2015 2014

Net profit attributable to Cicor shareholders in CHF 1 000 –3 982 6 896

Weighted average number of ordinary shares outstanding 2 896 914 2 888 571

Basic earnings per share in CHF –1.37 2.39

Diluted earnings per share

2015 2014

Weighted average number of shares outstanding (basic) 2 896 914 2 888 571

Adjustment for share options 1 282 6 224

Weighted average number of shares outstanding (diluted) 2 898 196 2 894 795

Profit applicable for calculation of earnings per share (basic and diluted) in CHF 1 000 –3 982 6 896

Diluted earnings per share in CHF –1.37 2.38

20. SHARE-BASED PAYMENTSCicor Technologies Ltd. has issued options under three stock option plans during the financial years 2008 and 2009. Since then, no additional stock option plans have been issued. Plan 1 has expired on 3 January 2015.

AssessmentThe prices of the call options issued to executive directors and management on 3 January 2008, 3 January 2009 and 26 November 2009 were calculated according to a trinomial model using the following parameters:

Plan 1 Plan 2 Plan 3

Share price on 3 January 2008/2009 and 26 November 2009 CHF 73.70 CHF 26 CHF 30

Exercise price CHF 78 CHF 32 CHF 28.80

Expected volatility 28 % 40 % 45 %

Life of the option 3 January 2015 3 January 2016 26 November 2016

Risk-free interest rate 2.97 % 2.44 % 1.88 %

Vesting period three years three years two years

Option type American American American

The weighted average share price for 2015 was CHF 30.57 (2014: 35.61). There were no option expenses recognized during the financial years 2015 and 2014.



Option holdingsThe following table shows the option holdings of executive directors and the members of the executive and senior management as of 31 December:

2015


Outstanding options per 1 January 2015 4 000 2 668 29 125

Exercised – – –10 000

Expired –4 000 – –

Outstanding options per 31 December 2015 – 2 668 19 125

Thereof exercisable – 2 668 19 125

These potential ordinary shares from Plan 2 and Plan 3 are dilutive. For the dilution effect on earnings per share, please refer to note 19.

2014


Outstanding options per 1 January 2014 6 000 3 002 40 375

Exercised – –334 –11 250

Expired –2 000 – –

Outstanding options per 31 December 2014 4 000 2 668 29 125

Thereof exercisable 4 000 2 668 29 125

21. PERSONNEL COSTS

in CHF 1 000 2015 2014

Wages and salaries 46 646 48 427

Social security costs 7 653 7 416

Other personnel costs 2 590 2 977

Total 56 889 58 820

22. EMPLOYEES

2015 2014

Number of employees (FTE)

Production 1 786 1 673

Marketing and sales 64 70

Administration 108 109

Total 1 958 1 852



23. OTHER OPERATING EXPENSES

in CHF 1 000 2015 2014

Facility costs 8 006 8 283

Maintenance costs 3 389 4 076

Other production costs 4 626 5 276

Sales and marketing costs 1 557 1 808

Administration costs 5 748 4 729

Total 23 326 24 172

24. FINANCIAL INCOME AND EXPENSE

in CHF 1 000 2015 2014

Income

Interest income 57 178

Foreign exchange gains 5 447 4 666

Total 5 504 4 844

Expense

Interest expense 1 767 1 775

Foreign exchange losses 5 896 4 340

Total 7 663 6 115

The increase in net foreign exchange losses of TCHF 775 is mainly due to the change in unrealized exchange losses of TCHF 571. The reason for this increase in expenses is the fact that the Swiss National Bank decided to discontinue the minimum exchange rate of CHF 1.20 per euro as of 15 January 2015.



25. RELATED PARTIES DISCLOSURESThe consolidated financial statements include the financial statements of Cicor Technologies Ltd., Boudry, and the subsidiaries listed in note 3.

The governing and supervisory bodies of Cicor Technologies Ltd. are the only other related parties.

As per 31 December 2015, HEB Swiss Investment AG, the main shareholder, holds 29.25% of total shares outstanding. Other principal shareholders are presented in the notes of the financial statements of Cicor Technologies Ltd.

On 17 September 2015, Swisstronics Contract Manufacturing AG sold the property in Bronschhofen, newly acquired in 2015 from a third party, to HEB Swiss Investment AG at the original purchase price of TCHF 2 930 (payment date 18 September 2015). Additionally, HEB Swiss Investments AG compensated Swisstronics Contract Manufacturing AG for investments already undertaken in the amount of TCHF 1 265 (payment date 1 December 2015) in connection with the building of a new production plant.

Compensation of key management personnel of the GroupThe remuneration of the Board of Directors and the Management also include the remuneration recorded at subsidiaries. Detailed information concerning compensation is published within the remuneration report on pages 36–37.

26. RISK MANAGEMENTRisk management is a fundamental element of Cicor’s business practice at all levels and encompasses different types of risks. It has been integrated into the controlling and reporting process according to the regulation in the Swiss Code of Obligation Art. 663b/12. Material risks are identified and quantified in workshops and discussed with the executive management and the Board of Directors. The risk management process will be repeated regularly, at least once a year.

27. FINANCIAL RISK MANAGEMENTThe Group has exposure to the following risks from its use of financial instruments: – Credit risk – Market risk – Liquidity risk

This note presents information about the Group’s exposure to each of the above risks. Further quantitative disclosures are included throughout these consolidated statements. The Board of Directors has overall responsibility for the establishment and oversight of the Group’s risk management framework. The following paragraphs give an overview of the extent of the above mentioned risks.

Credit riskThe credit risk is the risk of financial loss to the Group if a customer or counterparty to financial instruments fails to meet its contractual obligation. The assets mainly exposing the Group to a credit risk are: cash, cash equivalents and trade accounts receivable. The Group minimizes credit risk arising on cash and cash equivalents by investing in funds of high credit rated banks. These investments generally have a maturity of less than three months.

The Group’s exposure to credit risk arising from trade receivables is influenced mainly by the individual characteristics of each customer. The demographics of the Group’s customer base, including the default risk of the industry and country in which customers operate, has less of an influence on credit risk. The danger of risk concentration is generally minimized by the large number of customer credit balances, as no single customer accounts for more than 8% of consolidated sales 2015 (2014: no single customer accounted for more than 7% of consolidated sales).

The carrying value of financial assets reflects the maximum credit risk and is presented in the table below:

in CHF 1000 2015 2014

Cash and cash equivalents 27 681 17 006

Trade receivables 27 791 30 869

Other accounts receivable 1 791 1 959

Other currrent assets 489 114

Total 57 752 49 948

Every operational unit has a credit policy under which each new customer is analyzed individually for creditworthiness. Purchase limits are established for each customer which represent the maximum open amount possible. Customer lists are reviewed in a monthly meeting with the Group management. On a quarterly basis the allowances made according to the Group’s rules laid down in the financial manual are closely monitored.



Market riskThe market risk is the risk that changes in market prices, such as foreign exchange rates, interest rates and equity prices will affect the Group’s income or the value of its holdings of fi nancial instruments. The objective of risk management is to manage and control market risk exposures within acceptable limits. Cicor does not hold any financial instruments carried at fair value, but classifies all financial assets and liabilities as loans and receivables respectively as liabilities at amortized costs.

Currency riskThe Cicor Technologies Group is exposed to currency risk on sales and purchases that are denominated in a currency other than the respective currencies of Group entities. The currencies in which these transactions are primarily denominated are Swiss francs (CHF), euros (EUR), Singapore dollars (SGD) and US dollars (USD). These risks are mostly offset by cash flows from financial assets or liabilities resulting from opposite operational transactions (natural hedge). Consequently, these risks are at present not hedged by currency forwards or derivative instruments. Currency translation effects arising from yearend valuations are also not hedged.

Interest rate riskThe interest rate risk is the risk that there is a change in market value or future cash flow of a financial instrument if there is a change in interest rate.

The Group’s exposure to market risk for changes in interest rates relates primarily to the Group’s interest bearing financial debts. The Group’s policy is to manage its interest cost using a mix of fixed and variable debt. For an amount of CHF 43 million, the interest rate was reduced in 2015 from an average of 2.2% to an average of 1.9%. At the reporting date the interest rate profile of the Group’s interestbearing financial instruments is presented in note 12.

Liquidity riskThe liquidity risk is the risk that Cicor Technologies Ltd. cannot meet its financial obligations when they are due.

A syndicated loan of CHF 65 million (utilized as per 31 December 2015: CHF 43 million) is available to secure short to longterm financing requirements (see note 12). Compliance with the financial covenants defined in the syndicated loan is a central element of the Group’s financial risk management. The bank covenants were fulfilled at all times. The shortterm liquidity risk is reduced by the cash flow generated by operations, the trend of which is monitored continuously.

The following table shows the contractual cash flows of financial liabilities including interest payments as of 31 December:

2015 in CHF 1 000 Carrying amount

Contractual cash flow

2016 contractual

cash flow

2017 contractual

cash flow

2018 contractual

cash flow

2019 contractual

cash flow

2020 and after contractual

cash flow

Financial liabilities 47 691 50 825 5 408 1 234 43 762 304 117

Trade payables 21 831 21 831 21 831 – – – –

Other current liabilities and accruals 12 139 12 139 12 139 – – – –

Total 81 661 84 795 39 378 1 234 43 762 304 117

2014 in CHF 1 000 Carrying amount

Contractual cash flow

2015 contractual

cash flow

2016 contractual

cash flow

2017 contractual

cash flow

2018 contractual

cash flow

2019 and after contractual

cash flow

Financial liabilities 38 239 40 509 6 166 992 33 150 133 68

Trade payables 23 658 23 658 23 658 – – – –

Other current liabilities and accruals 13 921 13 922 13 922 – – – –

Total 75 818 78 089 43 746 992 33 150 133 68

The net carrying amount of financial assets and liabilities is a reasonable approximation of the fair value. No significant deviations between the net carrying amount and the fair value were noted.

Financial liability is measured using the effective interest method. The effective interest method is a method of calculating the amortized cost of a financial liability and allocating the interest expense over the relevant period.



28. RESEARCH AND DEVELOPMENTCicor Group does not have any costs for research activities, but on average spends about 7% to 8% of sales as development costs.

29. SUBSEQUENT EVENTSNo events took place between 31 December 2015 and 8 March 2016 that would require an adjustment to the amounts recognized in these consolidated financial statements.



REPORT OF THE STATUTORY AUDITOR ON THE CONSOLIDATED FINANCIAL STATEMENTS TO THE GENERAL MEETING OF SHAREHOLDERSREPORT OF THE STATUTORY AUDITOR ON THE CONSOLIDATED FINANCIAL STATEMENTSAs statutory auditor, we have audited the consolidated financial statements of Cicor Technologies Ltd., Boudry, which comprise balance sheet, income statement, cash flow statement, statement of changes in equity and notes on pages 42 to 70 for the year ended 31 December 2015.

Board of Directors’ responsibilityThe board of directors is responsible for the preparation of the consolidated financial statements in accordance with Swiss GAAP FER and the requirements of Swiss law. This responsibility includes designing, implementing and maintaining an internal control system relevant to the preparation of consolidated financial statements that are free from material misstatement, whether due to fraud or error. The board of directors is further responsible for selecting and applying appropriate accounting policies and making accounting estimates that are reasonable in the circumstances.

Auditor’s responsibilityOur responsibility is to express an opinion on these consolidated financial statements based on our audit. We conducted our audit in accordance with Swiss law and Swiss Auditing Standards as well as International Standards on Auditing. Those standards require that we plan and perform the audit to obtain reasonable assurance whether the consolidated financial statements are free from material misstatement.

An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the consolidated financial statements. The procedures selected depend on the auditor’s judgment, including the assessment of the risks of material misstatement of the consolidated financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers the internal control system relevant to the entity’s preparation and fair presentation of the consolidated financial statements in order to design audit procedures that are appropriate in the circumstances, but not for the pur

pose of expressing an opinion on the effectiveness of the entity’s internal control system. An audit also includes evaluating the appropriateness of the accounting policies used and the reasonableness of accounting estimates made, as well as evaluating the overall presentation of the consolidated financial statements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion.

OpinionIn our opinion, the consolidated financial statements for the year ended 31 December 2015 give a true and fair view of the financial position, the results of operations and the cash flows in accordance with Swiss GAAP FER and comply with Swiss law.

REPORT ON OTHER LEGAL REQUIREMENTSWe confirm that we meet the legal requirements on licensing according to the Auditor Oversight Act (AOA) and independence (article 728 CO and article 11 AOA) and that there are no circumstances incompatible with our independence.

In accordance with article 728a paragraph 1 item 3 CO and Swiss Auditing Standard 890, we confirm that an internal control system exists, which has been designed for the preparation of consolidated financial statements according to the instructions of the board of directors.

We recommend that the consolidated financial statements submitted to you be approved.

Zurich, 8 March 2016KPMG AG



72 Cicor | Financial Report 2015 | Financial Statements (Holding)

FINANCIAL STATEMENTS OF CICOR TECHNOLOGIES LTD.BALANCE SHEET

in CHF 1 000 31.12.2015 31.12.2014

Assets

Cash and cash equivalents 18 926 9 032

Other current receivables

– third party 44 21

– Subsidiaries 1 958 1 141

Accruals 607 92

Current assets 21 535 10 286

Long-term loans to Subsidiaries 49 795 45 885

Long-term loans to Subsidiaries subordinated 18 000 18 000

Investments 83 236 121 236

Non-current assets 151 031 185 121

Total assets 172 566 195 407

Liabilities and shareholders’ equity

Financial liabilities

– Subsidiaries 9 645 5 236

Other liabilities 13 85

Accrued expenses 2 211 1 783

Current liabilities 11 869 7 104

Non-current interest bearing liabilities

– third parties 43 000 32 000

Non-current liabilities 43 000 32 000

Ordinary share capital 29 021 28 921

Legal capital reserve

– General reserve 1 467 1 467

– Capital contribution reserves 108 171 109 211

– Share premium 1 239 1 051

Voluntary retained earnings

– Gain brought forward 15 706 12 748

– Net profit of the year –37 869 2 958

Treasury shares –38 –53

Shareholders’ equity 117 697 156 303

Total liabilities and shareholders’ equity 172 566 195 407


Cicor | Financial Report 2015 | Financial Statements (Holding) 73

INCOME STATEMENT

in CHF 1 000 2015 2014

Income

Financial income 3 747 4 664

Interest received from Group companies 1 373 1 365

Interest received from third party 41 161

Other income – 68

Total income 5 161 6 258

Expenses

Financial expense 2 591 1 409

Administrative expense 2 437 1 886

Impairment 38 000 –

Tax 2 6

Total expenses 43 030 3 301

Net profit of the year –37 869 2 957



NOTES TO THE FINANCIAL STATEMENTS OF CICOR TECHNOLOGIES LTD.1. PRINCIPLES

General aspectsThese financial statements were prepared according to the provisions of the Swiss Law on Accounting and Financial Reporting (32nd title of the Swiss Code of Obligations). Where not prescribed by law, the significant accounting and valuation principles applied are described below. Certain prior year amounts have been reclassified to conform to the current year’s presentation. these relate to the changes due to the new Swiss Code of obligations.

Financial assetsFinancial assets include longterm loans. Loans granted in foreign currencies are translated at the rate at the balance sheet date, whereby unrealized losses are recorded but unrealized profits are not recognized.

Treasury sharesTreasury shares are recognized at market value and deducted from shareholder’s equity at the time of acquisition. In case of a resale, the gain or loss is recognized through the income statement as financial income or financial expenses.

Long-term interest-bearing liabilitiesInterestbearing liabilities are recognized in the balance sheet at nominal value. Issue costs for financial debts are capitalized and amortized on a straight line method over the financial debt maturity period.

Foregoing a cash flow statement and additional disclosures in the notesAs Cicor Technologies Ltd. has prepared its consolidated financial statements in accordance with a recognized accounting standard (Swiss GAAP FER), it has decided to forego presenting additional information on interestbearing liabilities and audit fees in the notes as well as a cash flow statement in accordance with the law.

2. INFORMATION ON BALANCE SHEET AND INCOME STATEMENT ITEMS

Long-term loans to subsidiariesLoans in the amount of TCHF 47 750 have been granted to our companies in Switzerland, Romania and Asia. Loans in the amount of TEUR 7 650 have been granted to our companies in Germany. Loans in the amount of TUSD 8 725 have been granted to our companies in Asia. A loan in the amount of TSGD 4 500 has been granted to one of our companies in Asia.

Investments

in CHF 1 000, unless otherwise stated Participation in %

Currency 31.12.2015 31.12.2014

Cicorel SA, Boudry/Switzerland* 100 CHF 8 000 8 000Engineering/Production/Sales/Distribution

Reinhardt Microtech AG, Wangs/Switzerland* 100 CHF 1 800 1 800Engineering/Production/Sales/Distribution

Reinhardt Microtech GmbH, Ulm/Germany 75 EUR 500 500Engineering/Production/Sales/Distribution

RHe Microsystems GmbH, Radeberg/Germany* 100 EUR 216 216Engineering/Production/Sales/Distribution

Electronicparc Holding AG, Wil/Switzerland* 100 CHF 23 271 23 271Holding/Finance

Swisstronics Contract Manufacturing AG, Wil/Switzerland

100 CHF 3 000 3 000

Engineering/Production/Sales/Distribution



Systronics SRL, Arad/Romania 100 RON 5 145 5 145Production

Systel Italia SRL, Milano/Italy 100 EUR 10 10Sales/Distribution

ESG Holding Pte Ltd., Singapore* 100 SGD 1 896 1 896Holding/Finance

Cicor Asia Pte Ltd., Singapore 100 SGD 1 000 1 000Sales/Distribution

Cicor Ecotool Pte Ltd., Singapore 100 SGD 1 000 1 000Engineering/Production

PT Cicor Panatec, Batam/Indonesia 100 USD 300 300Production

Brant Rock Enterprises Corporation, British Virgin Islands 100 USD 10 10Holding/Finance

Cicor Anam Ltd., Anam/Vietnam 100 USD 1 500 1 500Production

Suzhou Cicor Technology Co. Ltd., China 100 CNY 34 798 23 507Production

Cicor Americas Inc., USA 100 USD 10 10Sales/Distribution

Cicor Management AG, Zurich/Switzerland* 100 CHF 250 250Management Services

*) Directly held subsidiaries

Non-current interest bearing liabilitiesCicor signed a new syndicated bank loan agreement on 22 December 2014 on a total line of CHF 65 million, which was utilized by CHF 43 million cash on 31 December 2015 (please refer to page 61 for further information).

Capital structure

31.12.2015 31.12.2014

Share capital at 31 December

2 902 092 (2014: 2 892 092) registered shares of CHF 10 29 020 920 28 920 920

Issued capital and changes in capital structureThe ordinary share capital was increased in 2015 by 10 000 shares (2014: 11 584 shares) out of conditional capital at a nominal value of CHF 10 for the established stock option plans.

Cicor Technologies Ltd. is a holding company established under Swiss law. According to the provisions of law governing the appropriation of retained earnings by holding companies, the share capital and appropriations to the general legal reserve to the extent of 20% of share capital as well as the reserve for treasury shares may not be distributed.

DividendAny dividend distribution must be proposed by the Board of Directors and approved by the Annual Shareholder’s Meeting. At the Shareholders’ Meeting of 23 April 2015, the shareholders decided to allocate TCHF 1 041 from the capital contributions to the free reserves and to distribute CHF 0.36 per share (totaling CHF 1 040 613.12) to the shareholders out of these free

reserves. Due to the results in the 2015 financial year, the Board of Directors will propose to the Annual Sharholders’ meeting to forego the distribution of earnings.

Authorized capitalAt the Shareholders’ Meeting at 24 April 2014, the shareholders decided to renew the authorization of the Board of Directors to increase the share capital by a maximum of 600 000 fully paidin shares at a nominal value of CHF 10 until 24 April 2016. Conditional capitalAt the Shareholders’ Meeting of 13 May 2009, the shareholders decided to increase the conditional share capital up to 200 000 fully paidin registered shares with a total nominal value up to CHF 2 000 000 for the exercise of stock option rights granted to officers and other key employees under an employee stock option plan established by the Board of Directors. During 2015, 10 000 (2014: 11 584) shares were issued.

As of 31 December 2014, according to the stock option plans approved by the Board of Directors on 3 January 2008, 3 January 2009 and 26 November 2009, 21 793 options (previous year 35 793) were outstanding.

At the Shareholders’ Meeting of 13 May 2009, the shareholders decided to create additional conditional share capital of up to 500 000 fully paid in registered shares with a total nominal value of up to CHF 5 000 000 for the exercise of conversion rights granted to holders of convertible debt securities to be issued by the company. Such conversion rights would have to be exercised within five years of the issuance of such convertible debt securities.



Treasury shares

Number of shares

1 January 2014 1 500

31 December 2014 1 500

31 December 2015 1 500

Neither in 2015 nor in 2014 have any treasury shares been sold or purchased.

Financial incomeThe financial income mainly consists of the dividends of Electronicparc Holding AG (TCHF 2 700), RHe Microsystems GmbH (TEUR 350) and Reinhardt Microtech AG (TCHF 300) and of realized foreign exchange gains (TCHF 379).

Administrative expenseThe administrative expense mainly consist of remuneration to the Board of Directors of TCHF 264 and stewardship costs of TCHF 1 676 (costs charged by Cicor Management AG, costs for the annual report and annual general meeting).

ImpairmentAccording to the new law on accounting and financial reporting, article 960 CO paragraph 1, the principle of individual valuation applies for the first time while in prior years investments were valued by a portfolio approach. As consequence, impairment losses on investments in the amount of TCHF for 25 462 for Reinhardt Microtech AG and TCHF 12 538 for Cicorel SA were recorded in 2015.

3. OTHER INFORMATION

Full-time equivalentsCicor Technologies Ltd. does not have any employees.

Contingent liabilitiesFor a lease contract between Cicorel and a Swiss insurance company, Cicor Technologies Ltd. grants a guarantee in favour of the said insurance company in the amount of TCHF 5 869, which represents the discounted value of future rental payments.

Pledged assetsThe shares of the following companies at a book value of TCHF 117 308 (2014: TCHF 109 604) are in deposit with Commerzbank AG and pledged as collateral for the syndicated credit line contracted in 2014: Cicorel SA, Electronicparc Holding AG, Swisstronics Contract Manufacturing AG, Reinhardt Microtech AG and RHe Microsystems GmbH.

in CHF 1 000 31.12.2015 31.12.2014

Guarantee in favour of a Swiss insurance company 5 869 6 524

Principal shareholdersThe following shareholdings correspond to the ones reported according to the regulations of the Swiss Stock Exchange (SIX Swiss Exchange) and updated as in the shares register per yearend.

31.12.2015 Number of

shares

in %1) 31.12.2014 Number of

shares

in %1)

HEB Swiss Investment AG, Zürich, Switzerland 848 375 29.25 848 375 29.33

Quaero Capital (previously ARGOS Fund), Luxembourg 145 000 5.00 145 000 5.01

Escatec Holdings Ltd., Port Vila, Vanuatu 141 061 4.86 141 061 4.88

1) in % of the total outstanding shares.



Compensation of Board of Directors and Management 2015Please refer to pages 36 to 37.

Shareholdings of Board of Directors and Management

in CHF 1 000 2015 Number of

shares

2015 Number of

options

2014 Number of

shares

2014 Number of

options

Heinrich J. Essing – – – –

Robert Demuth 5 124 10 000 5 124 10 000

Andreas Dill 1 000 – – –

Erich Haefeli – – n/a n/a

Total current Board members 6 124 10 000 5 124 10 000

in CHF 1 000 2015 Number of

shares

2015 Number of

options

2014 Number of

shares

2014 Number of

options

Jürg Dübendorfer 4 000 – n/a n/a

Patric Schoch 4 000 – 3 200 –

Erich Trinkler – – – –

Jürgen Steinbichler – – n/a n/a

Total current Management 8 000 – 3 200 –

Shares or options on shares for members of the board and employeesIn 2015 and 2014, no shares or options on shares were allocated to members of the board or to employees.

Significant events after the balance sheet dateThere are no significant events after the balance sheet date which could impact the book value of the assets or liabilities or which should be disclosed here.

4. PROPOSED APPROPRIATION OF AVAILABLE EARNINGS

in CHF 1 000 31.12.2015

Gain brought forward 15 706

Net profit of the year –37 869

Gain brought forward 22 163

The Board of Directors is proposing to forego a profit distribution.



the appropriateness of the accounting policies used and the reasonableness of accounting estimates made, as well as evaluating the overall presentation of the financial statements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion.

OpinionIn our opinion, the financial statements for the year ended 31 December 2015 comply with Swiss law and the company’s articles of incorporation.

REPORT ON OTHER LEGAL REQUIREMENTSWe confirm that we meet the legal requirements on licensing according to the Auditor Oversight Act (AOA) and indepen dence (article 728 CO and article 11 AOA) and that there are no circumstances incompatible with our independence.

In accordance with article 728a paragraph 1 item 3 CO and Swiss Auditing Standard 890, we confirm that an internal control system exists, which has been designed for the preparation of financial statements according to the instructions of the board of directors.

We further confirm that the proposed appropriation of available earnings complies with Swiss law and the company’s articles of incorporation. We recommend that the financial statements submitted to you be approved.

Zurich, 8 March 2016KPMG AG


REPORT OF THE STATUTORY AUDITOR ON THE FINANCIAL STATEMENTS TO THE GENERAL MEETING OF SHAREHOLDERS

REPORT OF THE STATUTORY AUDITOR ON THE FINANCIAL STATEMENTSAs statutory auditor, we have audited the financial statements of Cicor Technologies Ltd., which comprise the balance sheet, income statement and notes on pages 72 to 77 for the year ended 31 December 2015.

Board of Directors’ responsibilityThe board of directors is responsible for the preparation of the financial statements in accordance with the requirements of Swiss law and the company’s articles of incorporation. This responsibility includes designing, implementing and maintaining an internal control system relevant to the preparation of financial statements that are free from material misstatement, whether due to fraud or error. The board of directors is further responsible for selecting and applying appropriate accounting policies and making accounting estimates that are reasonable in the circumstances.

Auditor’s responsibilityOur responsibility is to express an opinion on these finan cial statements based on our audit. We conducted our audit in accordance with Swiss law and Swiss Auditing Standards. Those standards require that we plan and perform the audit to obtain reasonable assurance whether the financial statements are free from material misstatement.

An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial statements. The procedures selected depend on the auditor’s judgment, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers the internal control system relevant to the entity’s preparation of the financial statements in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the entity’s internal control system. An audit also includes evaluating


SALES BY INDUSTRY2015 / 2014

SALES BY EXPORT REGION 2015 / 2014

Aerospace and defense Communication Industry Medical Automotive and transport Watches and consumer Other

Switzerland Europe (excluding Switzerland) Asia North America Other

8%

9%

30%

27%

9%

12%

5%

28%

9%

9%

27%

11%

12%

4%

40%

35%

1%

39%

36%

6% 7%

18%17%

1%

Published byCicor Technologies Ltd.

Design concept/Realisation Linkgroup AG, Zurichwww.linkgroup.ch

Fotos: Shutterstock, Belimed AG

ADDRESSESCicor Anam Ltd.15 VSIP Street 4Thuan An DistrictBinh Duong Province VietnamTel. +84 650 375 66 23Fax +84 650 375 66 24www.cicor.com

Suzhou Cicor Technology Co. Ltd.EPZ No. 11 BuildingNo. 666 Jianlin RoadSND-EPZ Sub-industrial ParkSuzhou, China 215151Tel. +86 512 6667 2013www.cicor.com

HEAD OFFICE Cicor Technologies Ltd.Route de l’Europe 82017 [email protected]

CONTACTCicor Management AGWorld Trade Center Leutschenbachstrasse 95 8050 ZurichSwitzerlandwww.cicor.com

Tel. +41 43 811 44 05 Fax +41 43 811 44 09 [email protected]@cicor.com

CICOR ADVANCED MICROELECTRONICS & SUBSTRATESCicorel SARoute de l’Europe 82017 BoudrySwitzerlandTel. +41 32 843 05 00Fax +41 32 843 05 99www.cicor.com

Cicor Americas Ltd.185 Alewife Brook Parkway,Suite #410CambridgeMA 02138USATel. +1 617 576 2005Fax +1 617 576 2001www.cicor.com

RHe Microsystems GmbHHeidestrasse 7001454 RadebergGermanyTel. +49 3528 4199-0Fax +49 3528 4199-99www.cicor.com

Reinhardt Microtech GmbHSedanstrasse 1489077 UlmGermanyTel. +49 731 9858 8413Fax +49 731 9858 8411www.cicor.com

Reinhardt Microtech AGAeulistrasse 107323 WangsSwitzerlandTel. +41 81 720 04 56Fax +41 81 720 04 50www.cicor.com

CICOR ELECTRONIC SOLUTIONSSwisstronicsContract Manufacturing AGIndustriestrasse 89552 BronschhofenSwitzerlandTel. +41 71 913 73 73Fax +41 71 913 73 74www.cicor.com

S.C. Systronics S.R.L.Zone Parc Industrial F-N310580 AradRomaniaTel. +40 257 285 944Fax +40 257 216 733www.cicor.com

Cicor Asia Pte Ltd.45 Changi South Avenue 2#04-01 Singapore 486133SingaporeTel. +65 6546 16 60Fax +65 6546 65 76www.cicor.com

Cicor Ecotool Pte Ltd.45 Changi South Avenue 2#04-00 Singapore 486133SingaporeTel. +65 6545 50 30Fax +65 6545 00 32www.cicor.com

PT Cicor PanatecBatamindo Industrial Park, Lot 323 - 324Jalan Beringin, Muka KuningBatam 29433 IndonesiaTel. +62 770 61 22 33Fax +62 770 61 22 66www.cicor.com

This annual report is published in German and English as a print and online version. The print and online German version is binding.© Cicor Technologies Ltd., March 2015

KEY FIGURES

in CHF 1 000 unless otherwise specified 2012 in % 2013 in % 2014 in % 2015 in %

Net sales 176 016 100.0 190 453 100.0 202 458 100.0 180 612 100.0

Change compared to previous year (%) –1.5 8.2 6.3 –10.8

EBITDA before restructuring costs 15 323 8.7 17 604 9.2 19 662 9.7 12 117 6.7

Change compared to previous year (%) 53.1 14.9 11.7 –38.4

Operating profit before restructuring costs (EBIT) 7 301 4.1 8 512 4.5 10 229 5.1 3 066 1.7

Restructuring costs – 0.0 – 0.0 – 0.0 –4 718 –2.6

Operating profit (EBIT) 7 301 4.1 8 512 4.5 10 229 5.1 –1 652 –0.9

Earnings before taxes (EBT) 5 057 2.9 5 816 3.1 8 958 4.4 –3 811 –2.1

Income taxes 1 081 0.6 –1 272 –0.7 –1 952 –1.0 –245 –0.1

Net profit before restructuring costs 6 138 3.5 4 544 2.4 7 006 3.5 662 0.4

Net profit/(loss) 6 138 3.5 4 544 2.4 7 006 3.5 –4 056 –2.2

Earnings per share 2.28 1.58 2.39 –1.37

Number of employees (FTEs at end of period) 1 512 1 912 1 852 1 958

Division results 2012 in % 2013 in% 2014 in% 2015 in%

AMS Division

– Sales 63 282 100.0 59 095 100.0 56 934 100.0 49 510 100.0


ES Division

– Sales 112 872 100.0 131 405 100.0 145 662 100.0 131 578 100.0




Annual Report 2015

Innovation for success

Cicor Technologies Ltd.Route de l’Europe 82017 BoudrySwitzerlandwww.cicor.com


annual report 2015 - cicor group · annual report 2015 innovation for success cicor technologies...

Documents