Siegfried reported sales for the 2015 financial year of CHF 480.6 million, an increase of 52.4% in Swiss francs or 57.9% in local currencies. EBITDA grew by CHF 18.3 million (31.1%) to CHF 77.1 million, corresponding to an EBITDA margin of 16.0%. Earnings before interest and taxes (EBIT) are stated as CHF 43.4 million, a growth of 27.6%. Net profit grew slightly as a result of lower tax credits and higher financial expenses, namely by 1.4% to CHF 39.1 million.
The revaluation of the Swiss franc reduced Siegfried’s sales in 2015 by CHF 17 million. The resulting effect on results was fully compensated for by the high cost exposure in the euro and dollar regions and, consequently, operating results as a whole were not negatively impacted. Owing to the difficult foreign-currency situation resulting from the abolishment of the lower level of the euro-franc exchange rate at the beginning of 2015, this type of internal compensation, also called natural hedge, has become a core element of risk management, and it safe-guards the company’s competitiveness in its key markets.
Siegfried owes the strong growth reported in sales and results to a combination of internal and external growth. Corrected by these acquisition effects, the sales growth in 2015 lay in the single digit percentage area.
In the year under review, Siegfried reported operating cash flow before changes in net current assets of CHF 65.0 million (2014: CHF 58.1 million), representing a growth of 12.0%. Including changes in net working capital, operating cash flow decreased slightly to CHF 23.1 million (2014: CHF 24.6 million).
In view of the good results, the Board of Directors will propose to the Annual General Meeting a higher payout from the capital contribution reserve to CHF 1.80 (2014: CHF 1.50). The profit distribution is tax-exempt in many countries.
Positive development of pipeline and order situation
The risk-adjusted value of projects gained in the year under review – without the sites acquired in 2015 – rose by 25%, the highest level in this decade.
"Transform" Strategy: Core objective "critical size" achieved
Siegfried charted the course for a successful future by initiating the “Transform” strategy in 2010. Today, the company is significantly larger and more competitive. It is market leader in the field of exclusive synthesis and controlled substances and a major supplier of sterile filling and of dossiers for generics companies including the production of solid dosage forms. Its unique selling proposition, namely the combination of chemical and pharmaceutical capabilities, represents a large advantage to customers in their daily close cooperation with Siegfried.
The final step in implementing the “Transform” strategy was taken by acquiring BASF’s active pharmaceutical ingredients business and three connected sites, providing Siegfried with the critical size essential in this segment. The company is now in a position to react faster and more flexibly to customer inquiries.
In addition, other strategically important projects were advanced. The new production facility in Nantong (China) was inaugurated in August 2015, and initial commercial production batches have been successfully produced.
The new production plant in Zofingen was also put into operation. Its construction supports vertical-flow production and includes the latest developments in technology. Its operation will be significantly more efficient than the older facilities which it replaces. By means of this plant, Siegfried actively contributes toward maintaining industrial jobs in Switzerland. Without this investment, profitable production activity in Zofingen would sooner or later become unviable.
Following the acquisition of the three BASF sites, the number of employees grew by 850 to about 2,200 (full-time equivalents). Owing to its new size, Siegfried today is a clearly more attractive employer as it provides an increasing number of more varied career opportunities in its global network. In the future, Siegfried will succeed even better in bringing aboard talented people who will remain with the company long term.
Two new Board members
The Board of Directors will propose to the Annual General Meeting the nomination to the Board of Ulla Schmidt (Member of the German Bundestag) and Martin Schmid, Member of the Swiss Council of State. Ulla Schmidt has been a member of the German Bundestag since 1990, and she serves as its vice-president since 2013. She was appointed Minister of Health in the German federal government in 2001, a position she held until 2009. Martin Schmid was elected to Switzerland’s Council of States representing Canton Grisons in 2011. He served on the Grisons cantonal government from 2003 to 2011, initially as head of the department of justice, security and health and subsequently of the department of finance. Membership on Siegfried’s Executive Committee remained unchanged in the year under review.
Siegfried expects sales in 2016 to grow by over 40% compared to 2015. The company anticipates EBITDA in the range of CHF 100 million (before cost of integration) and net profit to develop positively. As a result, the dividend is expected to increase further.
Peter Gehler, Chief Communications Officer
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Siegfried Holding AG
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The Siegfried Group is active worldwide in the field of Life Sciences with production facilities located in Switzerland, the USA, Malta, China, Germany and France. At the end of 2015, Siegfried reported annual sales of CHF 481 million and employs at the time being approximately 2200 employees at nine locations on three continents. Siegfried Holding AG is listed on the Swiss Exchange (SIX: SFZN).
Siegfried is active in both the primary and secondary production of drugs. The company develops and manufactures active pharmaceutical ingredients for the research-based pharmaceutical industry as well as the corresponding intermediates and controlled substances, and provides development and production services for finished dosage forms including sterile filling.
Cautionary Statements Regarding Forward-Looking Statements
This press release may contain forward-looking statements based on current assumptions and forecasts made by Siegfried Group management and other information currently available to the Siegfried Group. Various known and unknown risks, uncertainties and other factors could lead to material differences between the actual future results, financial situation, development or performance of the company and the estimates given here. Siegfried Holding AG does not intend, and does not assume any liability whatsoever, to update these forward-looking statements or to conform them to future events or developments.