Notes to the consolidated financial statements

Additional information on the consolidated financial statements

1. Segment information

1. Segment information

1.1 Net sales by region

in CHF thousand

2020

%

2019

%

Switzerland

48 289

11 

74 494

14 

Europe (excluding Switzerland)

276 755

62 

322 071

62 

The Americas

64 602

15 

69 482

13 

Asia

49 461

11 

53 403

10 

Rest of the world

6 082

5 207

Total

445 189

100 

524 657

100 

Total net sales were 15.1 % (CHF 79.5 million) below their prior-year level, or 10.7 % (CHF 59.8 million) down based on prior-year currency exchange rates and excluding acquisitions. The impact of currency movements amounted to –4.4 % (CHF –19.7 million) while, as in 2019, acquisitions and disposals had no impact on net sales results. Average Swiss-franc currency exchange rates were down 3.7 % against the euro and down 5.6 % against the US dollar.

1.2 Income statement by division

2020 in CHF thousand

Chemistry

Paper

Packaging

Other/ consolidation

Group

Net sales

73 286

209 581

162 322

445 189

EBITDA

9 467

17 369

27 819

496

55 151

in % of net sales

12.9 

8.3 

17.1 

12.4 

EBIT

4 612

– 2 035

21 626

460

24 663

in % of net sales

6.3 

– 1.0 

13.3 

5.5 

2019 in CHF thousand

Chemistry

Paper

Packaging

Other/ consolidation

Group

Net sales

78 212

293 236

153 209

524 657

EBITDA

9 491

54 511

23 746

246

87 994

in % of net sales

12.1 

18.6 

15.5 

16.8 

EBIT

4 403

34 724

17 263

210

56 600

in % of net sales

5.6 

11.8 

11.3 

10.8 

2. Other operating income

2. Other operating income

in CHF thousand

2020

2019

Energy sales

3 116

3 198

Rental income from business premises

507

498

Income from production waste

676

744

Miscellaneous

1 324

1 160

Total

5 623

5 600

Other operating income for 2020 was broadly in line with its prior-year level.

3. Personnel expense

3. Personnel expense

in CHF thousand

2020

2019

Salaries and wages

76 914

77 037

Pension scheme contributions and other social security expense

14 346

13 635

Other personnel expense

1 871

2 230

Total

93 131

92 902

Personnel expense for 2020 was a 0.2 % (CHF 0.2 million) increase on the prior year. The Packaging Division saw its workforce further enlarged in response to high product demand. By contrast, personnel expense for the Paper and Chemistry divisions (excluding the special impact of US pension scheme expense, see Note 18.2) was lower as a result of the lower business demand, rigorous cost management and short-time working compensation (CHF 1.6 million). In addition to the contributions to state social security institutions, “Pension scheme contributions and other social security costs” includes the contributions to company pension schemes described in Note 18. Members of Group Executive Management were assigned a total of 2 381 shares in 2020 under their share-based compensation provisions. At a share price of CHF 75.75, the corresponding expense, which is shown under “Salaries and wages”, amounted to some CHF 180 000.

4. Other operating expense

4. Other operating expense

The CHF 24.7 million of other operating expense (prior year: CHF 26.1 million) includes sales and administrative costs and further operating expenses. Thanks to consistent cost management and reduced travel activities in the light of the COVID-19 pandemic, other operating expense was CHF 1.4 million or 5.2 % below its 2019 level.

5. Financial income

5. Financial income

in CHF thousand

2020

2019

Interest income

32

42

Other financial income

179

424

– currency exchange rate gains

143

399

– further financial income

36

25

Income from securities

1

25

Total

212

491

Financial income was CHF 0.3 million below its prior-year level, owing to lower exchange rate gains on amounts held in foreign currencies.

6. Financial expense

6. Financial expense

in CHF thousand

2020

2019

Interest expense

2 693

4 648

– interest paid

2 690

6 202

– changes in deferred interest due

3

– 1 554

Other financial expense

2 166

1 486

– currency exchange rate losses

1 856

1 160

– further financial expense

310

326

Expenditure on securities

5

4

Total

4 864

6 138

Financial expense was CHF 1.3 million below its prior-year level owing to lower interest expense (in 2019 interest was paid on two parallel corporate bonds).

7. Non-operating result

7. Non-operating result

The non-operating income of CHF 7.3 million (prior year: CHF 1.4 million) comprises rental income and sale proceeds from non-operating real estate in Buchrain (CHF 5.2 million, prior year CHF 0.8 million) and Full-Reuenthal (CHF 0.1 million, prior year CHF 0.6 million), along with the release of CHF 2.0 million of provisions made for environmental protection measures to clean up the Rotholz waste disposal site in Meilen, Canton Zurich. The non-operating expense of CHF 0.5 million (prior year: CHF 0.6 million) consists of expenditure relating to the sale and management of non-operating real estate in Uetikon, Perlen, Buchrain and Full-Reuenthal.

8. Extraordinary result

8. Extraordinary result

The provisions for the lake bed clean-up at the former Uetikon site were reduced by CHF 12.0 million in 2020, with the release effected via the extraordinary result by analogy to the original creation in 2016 of the provisions concerned (see Notes 25/27). There was no extraordinary income or extraordinary expense in 2019.

9. Income taxes

9. Income taxes

in CHF thousand

2020

2019

Current income taxes

3 745

3 124

Deferred income taxes

– 11 856

202

Total

– 8 111

3 326

Perlen Papier AG has transferred real estate at the Perlen site to newly founded group member company Perlen Papier Immobilien AG at market rates. The transaction was effected using a previously uncapitalized CHF 97.1 million of tax losses carried forward. The intragroup transaction resulted in 2020 in deferred tax assets and corresponding deferred tax income of CHF 11.9 million, as the purely tax-related upward revaluation generated a deductible temporary difference. This resulted overall in profits from income taxes of CHF 8.1 million for the year. Tax rates varied in 2020 between 10 % and 34 % (prior year: between 10 % and 34 %) depending on the country and the location.

Income taxes for 2020

Tax rate in %

Tax amount in CHF thousand

Earnings before taxes

38 852

Weighted average tax rate expected/estimated tax expense

18.2 

7 080

Impact of losses carried forward not recognized in current year in tax terms

140

Impact of losses carried forward not previously recognized in tax terms

– 3 656

Impact of intragroup real-estate transaction resulting in using of losses carried forward not previously recognized in tax terms

– 11 929

Taxes paid in prior years

– 135

Other effects

389

Tax rate/tax expense as per income statement

– 20.9 

– 8 111

The Group’s expected income tax rate for 2020 amounted to 18.2 % (prior year: 14.2 %). This is the weighted average tax rate based on the individual profits/losses before taxes and tax rates for each group member company. The change in this expected income tax rate is due to the profit situation and changed tax rates at the various group member companies. The difference between the estimated income tax expense and the income tax expense shown in the income statement is attributable largely to the offsetting of losses carried forward from previous years in connection with an intragroup real estate transaction.

In accordance with the consolidated accounting principles, deferred taxes on losses carried forward are not capitalized. Uncapitalized losses carried forward declined for 2020 to CHF 65.2 million (prior year: CHF 199.5 million), with a potential tax impact of CHF 7.4 million (prior year: CHF 11.8 million), paying due regard to the multi-year plan and the provisions of and possibilities under the relevant national tax laws. The change is attributable in particular to the use of CHF 97.1 million of losses carried forward in connection with an intragroup real estate transaction. None of the losses carried forward are of indefinite duration, and CHF 5.2 million thereof will expire within a year.

Income taxes for 2019

Tax rate in %

Tax amount in CHF thousand

Earnings before taxes

51 779

Weighted average tax rate expected/estimated tax expense

14.2 

7 357

Impact of losses carried forward not recognized in current year in tax terms

18

Impact of losses carried forward not previously recognized in tax terms

– 4 500

Taxes paid in prior years

– 35

Other effects

487

Tax rate/tax expense as per income statement

6.4 

3 326

10. Liquid funds and securities

10. Liquid funds and securities

Liquid funds increased from CHF 93.1 million to CHF 116.3 million in 2020 as a result of the positive free cash flow trends. Financial liabilities were also reduced by a net CHF 4.8 million.

11. Trade accounts receivable

11. Trade accounts receivable

in CHF thousand

2020

2019

Receivables from third parties

60 032

81 865

Receivables from associates

0

0

Provisions for doubtful debts

– 7 140

– 9 470

– individual adjustments

– 7 135

– 9 469

– blanket adjustments

– 5

– 1

Total

52 892

72 395

Trade accounts receivable were CHF 19.5 million below their prior-year level, owing to the lower net sales in the Paper Division.

Individual adjustments are effected to certain doubtful receivables. Such adjustments were CHF 2.3 million lower in 2020 than they had been for the prior year. A long-standing receivable issue with a Paper Division client was also resolved in the course of the year.

12. Other receivables

12. Other receivables

Other receivables were CHF 3.2 million up on their prior-year level. The increase is attributable largely to real estate activities and environmental protection actions.

13. Prepaid expenses and accrued income

13. Prepaid expenses and accrued income

Prepaid expenses and accrued income were down CHF 1.9 million from their prior-year level. 2019 had seen a substantially higher amount of outstanding state “KEV” compensation for green energy generated.

14. Inventories

14. Inventories

14.1 Inventories by division

in CHF thousand

2020

2019

Chemistry

28 468

30 331

Paper

23 567

29 821

Packaging

26 288

18 391

Total

78 323

78 543

14.2 Inventories by type

in CHF thousand

2020

2019

Raw materials

17 367

15 460

Auxiliary and operating materials

13 997

14 888

Finished and semi-finished products

46 257

47 407

Goods for resale

702

788

Total

78 323

78 543

Inventories for 2020 were broadly at prior-year levels. Volumes of finished and semi-finished products declined in the Chemistry and Paper divisions as a result of active and cautious inventory management. Inventories for Packaging increased owing to the division’s sales growth.

Inventories were subjected to an overall impairment of CHF 4.4 million (prior year: CHF 2.8 million), primarily for the Paper Division.

15. Intangible assets

15. Intangible assets

Intangible assets in 2020 in CHF thousand

Software, licences and patents

Other intangible assets

Total intangible assets

At purchase values

Opening balance on 1.1.2020

15 769

1 173

16 942

Currency impact on opening balance

– 24

– 34

– 58

Additions

1 268

1 268

Disposals/reclassifications

– 167

– 167

Currency impact on movements

2

2

Closing balance on 31.12.2020

16 848

1 139

17 987

Depreciation

Opening balance on 1.1.2020

10 912

434

11 346

Currency impact on opening balance

– 17

– 14

– 31

Depreciation for the period

1 251

23

1 274

Disposals/reclassifications

– 167

– 167

Currency impact on movements

1

– 1

0

Closing balance on 31.12.2020

11 980

442

12 422

Book value on 1.1.2020

4 857

739

5 596

Book value on 31.12.2020

4 868

697

5 565

The goodwill deriving from the acquisitions of business activities and minorities was offset directly against equity (see Note 28). The “Additions” position reflects major investments in new ERP systems (software) for the Packaging Division.

Intangible assets in 2019 in CHF thousand

Software, licences and patents

Other intangible assets

Total intangible assets

At purchase values

Opening balance on 1.1.2019

14 968

1 202

16 170

Currency impact on opening balance

– 94

– 29

– 123

Change in consolidated companies

0

Additions

971

971

Disposals/reclassifications

– 71

– 71

Currency impact on movements

– 5

– 5

Closing balance on 31.12.2019

15 769

1 173

16 942

Depreciation

Opening balance on 1.1.2019

9 915

413

10 328

Currency impact on opening balance

– 71

– 4

– 75

Depreciation for the period

1 144

25

1 169

Disposals/reclassifications

– 71

– 71

Currency impact on movements

– 5

– 5

Closing balance on 31.12.2019

10 912

434

11 346

Book value on 1.1.2019

5 053

789

5 842

Book value on 31.12.2019

4 857

739

5 596

The “Additions” position reflects major investments in adopting a new ERP system (software) in the Chemistry Division.

Goodwill is offset against equity (retained earnings) at the time of its acquisition. The impact of a theoretical capitalization of goodwill with five-year straight-line amortization on the balance sheet and income statement is shown below:

Theoretical goodwill movement

in CHF thousand

2020

2019

At purchase values

Opening balance on 1.1.

61 736

61 736

Additions

1 285

0

Closing balance on 31.12.

63 021

61 736

Depreciation

Opening balance on 1.1.

44 264

37 061

Depreciation for the period

7 203

7 203

Closing balance on 31.12.

51 467

44 264

Net book value of goodwill on 1.1.

17 472

24 675

Net book value of goodwill on 31.12.

11 554

17 472

Impact of goodwill on the income statement

in CHF thousand

2020

2019

Earnings before interest and taxes (EBIT)

24 663

56 600

EBIT margin in % of net sales

5.5 

10.8 

Depreciation of goodwill

– 7 203

– 7 203

Theoretical earnings before interest and taxes (EBIT), including depreciation of goodwill

17 460

49 397

Theoretical EBIT in % of net sales

3.9 

9.4 

Net result for the year

46 963

48 453

Depreciation of goodwill

– 7 203

– 7 203

Theoretical net result, including depreciation of goodwill

39 760

41 250

Impact of goodwill on the balance sheet

in CHF thousand

2020

2019

Equity as per balance sheet

471 867

441 289

Equity in % of balance sheet total

67.0 

62.8 

Theoretical capitalization of net book value of goodwill

11 554

17 472

Theoretical equity including net book value of goodwill

483 421

458 761

Theoretical equity including net book value of goodwill in % of balance sheet total

67.5 

63.7 

16. Tangible fixed assets

16. Tangible fixed assets

Tangible fixed assets for 2020 in CHF thousand

Undevel- oped land

Developed land and buildings

Plant and equipment

Other facilities, IT HW

Fixtures in rented property

Vehicles

Assets under construction

Total

At purchase values

Opening balance on 1.1.2020

5 743

336 824

695 585

329 944

7 290

11 315

16 075

1 402 776

Currency impact on opening balance

– 14

– 2 347

– 4 666

– 246

– 149

– 44

– 160

– 7 626

Investments

1 050

214

7 529

3 463

25

177

6 031

18 489

Disposals

119

– 2 524

– 929

– 519

– 442

– 4 295

Reclassifications

0

230

2 319

393

– 2 942

0

Currency impact on movements

– 5

– 13

– 44

– 17

– 1

3

– 77

Closing balance on 31.12.2020

6 893

332 384

699 794

333 018

7 165

11 006

19 007

1 409 267

Depreciation

Opening balance on 1.1.2020

102

151 274

412 399

218 670

2 397

8 816

0

793 658

Currency impact on opening balance

– 3

– 973

– 3 380

– 154

– 142

– 33

– 4 685

Depreciation for the period

20

5 139

16 983

6 001

471

600

29 214

Disposals

– 2 364

– 778

– 519

– 442

– 4 103

Reclassifications

0

Currency impact on movements

0

– 21

– 90

– 5

– 2

2

– 116

Closing balance on 31.12.2020

119

153 055

425 134

223 993

2 724

8 943

0

813 968

Impairments

Opening balance on 1.1.2020

0

53 225

138 732

50 779

0

0

0

242 736

Currency impact on opening balance

0

Impairments for the period

0

Release of impairments for the period

0

Disposals

0

Reclassifications

0

Closing balance on 31.12.2020

0

53 225

138 732

50 779

0

0

0

242 736

Opening balance on 1.1.2020

5 641

132 325

144 454

60 495

4 893

2 499

16 075

366 382

Closing balance on 31.12.2020

6 774

126 104

135 928

58 246

4 441

2 063

19 007

352 563

Tangible fixed assets for 2020 include a net book value of CHF 0.5 million for leased assets (vehicles) capitalized through finance leases maturing between 2021 and 2023. Leasing liabilities amount to some CHF 0.5 million, of which CHF 0.3 million are short-term.

The production facilities of the Paper Division were assessed in terms of their current value as of 31 December 2020. No impairment was deemed necessary. The valuations were conducted using a WACC of 5.4 % and EUR/CHF exchange rates of CHF 1.05 for the 2021 plan period, CHF 1.11 for 2022 and CHF 1.14 for 2023. The values of the projected income statements were adjusted to take account of the facts and findings available on the balance sheet date.

Investments in the Chemistry Division in 2020 included various optimization projects (in Louisville, USA) and real estate (in Lianyungang, China). The Paper Division invested in a range of projects to maintain and further raise the efficiency of its production plant. The Packaging Division also made major investments at multiple locations: in enhancing the efficiency of the mono film production at its Müllheim (Germany) site, in modernizing the infrastructure at its Perlen facility and in expanding its production capacities in Suzhou, China.

Tangible fixed assets for 2019 in CHF thousand

Undevel- oped land

Developed land and buildings

Plant and equipment

Other facilities, IT HW

Fixtures in rented property

Vehicles

Assets under construction

Total

At purchase values

Opening balance on 1.1.2019

5 766

337 216

690 585

329 367

6 176

10 591

9 437

1 389 138

Currency impact on opening balance

– 16

– 1 576

– 2 760

– 317

– 41

– 18

– 113

– 4 841

Investments

401

6 104

2 469

1 471

12 456

22 901

Disposals

– 7

– 4

– 1 337

– 2 141

– 2

– 779

– 4 270

Reclassifications

830

3 082

562

1 157

49

– 5 680

0

Currency impact on movements

– 43

– 89

4

1

– 25

– 152

Closing balance on 31.12.2019

5 743

336 824

695 585

329 944

7 290

11 315

16 075

1 402 776

Depreciation

Opening balance on 1.1.2019

95

146 495

398 071

214 678

1 966

9 043

0

770 348

Currency impact on opening balance

– 3

– 427

– 1 820

– 189

– 39

– 11

– 2 489

Depreciation for the period

10

5 249

17 622

6 314

474

556

30 225

Disposals

– 4

– 1 337

– 2 141

– 2

– 772

– 4 256

Reclassifications

0

Currency impact on movements

0

– 39

– 137

8

– 2

– 170

Closing balance on 31.12.2019

102

151 274

412 399

218 670

2 397

8 816

0

793 658

Impairments

Opening balance on 1.1.2019

0

53 225

138 732

50 779

0

0

0

242 736

Currency impact on opening balance

0

Impairments for the period

0

Release of impairments for the period

0

Disposals

0

Reclassifications

0

Closing balance on 31.12.2019

0

53 225

138 732

50 779

0

0

0

242 736

Opening balance on 1.1.2019

5 671

137 496

153 782

63 910

4 210

1 548

9 437

376 054

Closing balance on 31.12.2019

5 641

132 325

144 454

60 495

4 893

2 499

16 075

366 382

Tangible fixed assets for 2019 included a net book value of CHF 0.8 million for leased assets (vehicles) capitalized through finance leases maturing between 2021 and 2023. Leasing liabilities amounted to CHF 0.9 million, of which CHF 0.4 million were short-term.

There were no indications as of 31 December 2019 that any impairment might be necessary on any production facilities.

17. Long-term financial assets

17. Long-term financial assets

in CHF thousand

Long-term financial assets

At purchase values

Opening balance on 1.1.2020

10 000

Investments

0

Disposals

0

Currency impact on movements

0

Closing balance on 31.12.2020

10 000

At purchase values

Opening balance on 1.1.2019

10 000

Investments

0

Disposals

0

Currency impact on movements

0

Closing balance on 31.12.2019

10 000

As in 2019, the long-term financial assets consist of the 10 % equity holding in waste incinerator company Renergia Zentralschweiz AG, Root, with which a supply agreement has been concluded for the provision of low-pressure steam to the Perlen paper factory.

18. Assets from employer contribution reserves and pension schemes

18. Assets from employer contribution reserves and pension schemes

18.1 Pension schemes in Switzerland (547 working insurees)

Employer contribution reserve (ECR)

Nominal value

Appro- priation waiver

Other value adjustments

Discount

Balance sheet

Balance sheet

ECR result in personnel expense

in CHF thousand

31.12.2020

31.12.2020

31.12.2020

31.12.2020

31.12.2020

31.12.2019

2020

2019

Pension schemes

11 189

11 189

11 078

– 111

0

Total

11 189

0

0

0

11 189

11 078

– 111

0

Economic benefit/economic obligation and pension scheme expense

Funding surplus/shortfall as per Swiss GAAP ARR 26

Economic interest of company

Change from prior year or recognized in income statement

Accrued contribu- tions for the period

Pension scheme expense in personnel expense

in CHF thousand

31.12.2020

31.12.2020

31.12.2019

31.12.2020

31.12.2020

2020

2019

CPH Group Pension Scheme

3 800

3 800

3 699

Pension schemes without funding surplus/shortfall

0

0

0

0

3 800

3 800

3 699

UBV Betriebs- und Verwaltungs AG Staff Welfare Fund

664

Perlen Group Assistance Fund

11 550

11 550

11 350

– 200

0

– 200

56

Employer’s funds

12 214

11 550

11 350

– 200

0

– 200

56

Total

12 214

11 550

11 350

– 200

3 800

3 600

3 755

Under the investment regulations of the CPH Group Pension Scheme, the scheme is considered to have a funding surplus if it has a fluctuation reserve amounting to 16.5 % or more of its total asset investments (calculated using the Value-at-Risk Method).

The CPH Group Pension Scheme is a defined-contributions pension scheme offering old-age, death and disability benefits. Employer’s contributions are strictly defined in the scheme’s regulations and deed of trust. The companies concerned do not bear any primary risk, i. e. the insurance and investment risks are borne primarily by the pension scheme itself. Actuarial recalculations are regularly conducted.

The latest static recalculation of actuarial capital was performed on 31 December 2019, based on an actuarial interest rate of 2.0 %, the actuarial foundations of the BVG 2015 Generation Table and a conversion factor of 5.8 %. Actuarial capital has since been further developed in line with insuree numbers effective 31 December 2020. With the exception of the employer contribution reserve of CHF 11.2 million (prior year: CHF 11.1 million), all the scheme’s surpluses are payable solely to its beneficiaries. According to its provisional balance sheet, the scheme had a funding ratio of 118 % as of 31 December 2020 (prior-year actual funding ratio: 116 %).

The UBV Uetikon Betriebs- und Verwaltungs AG Staff Welfare Fund

The UBV Uetikon Betriebs- und Verwaltungs AG Staff Welfare Fund is an employer’s fund for all employees at the CPH Group’s companies in Uetikon and Rüti. The Fund provides provident benefits for employees and financial assistance for employees and their families in hardship situations. Contributions to it are made solely by the employer. The Fund’s freely disposable trust capital (including fluctuation reserves) amounted to CHF 0.8 million on 31 December 2020 (prior year: CHF 0.8 million).

The Perlen Group Assistance Fund, Perlen

The Perlen Group Assistance Fund is an employer’s fund for all employees at the CPH Group’s Perlen site. The Fund provides provident benefits for employees and financial assistance for employees and their families in hardship situations. Contributions to it are made solely by the employer. The Fund can also be used to finance employer’s contributions to the occupational pension schemes of the Group’s Perlen-based companies. The Fund paid CHF 0.0 million to these schemes for such purposes in 2020 (prior year: CHF 0.0 million). The Fund’s freely disposable trust capital (including fluctuation reserves) amounted to CHF 13.7 million on 31 December 2020 (prior year: CHF 13.5 million).

As for 2019, economic interest was calculated based on freely disposable trust capital excluding fluctuation reserves.

18.2 Pension schemes outside Switzerland

Economic benefit/ economic obligation Pensions scheme expense

Funding surplus/shortfall

Economic interest of company

Change from prior year or recognized in income statement

Accrued contributions for the period

Pension scheme expense in personnel expense

in CHF thousand

31.12.2020

31.12.2020

31.12.2019

31.12.2020

31.12.2020

2020

2019

USA

474

474

492

Pension schemes without funding surplus/shortfall

0

0

0

0

474

474

492

USA

– 1 157

– 1 157

– 678

479

0

479

– 592

Pension schemes with funding shortfall

– 1 157

– 1 157

– 678

479

0

479

– 592

Total

– 1 157

– 1 157

– 678

479

474

953

– 100

In the USA the CPH Group has one defined-contributions and one defined-benefits occupational pension scheme.

The 401(k) defined contribution plan is a purely contributions-based savings scheme that does not expose the company to any liability and has neither a surplus nor a shortfall.

The defined-benefits scheme was frozen on 1 January 2016. As a result, there have been no further increases in pension obligations to beneficiaries since this date, and no further beneficiaries have been admitted. The scheme had 101 members as of 31 December 2020 (prior year: 108). The scheme currently has a funding shortfall of USD 1 309 000 (prior year: USD 700 000). The calculations were made using the Current Liability Method, under which no regard is paid to future salary increases or expected returns on investment.

The Group’s occupational pension schemes in its other countries of operation are of insignificant size, and provide all the social benefits prescribed by law.

18.3 Breakdown of pension scheme costs

in CHF thousand

In Switzerland

Outside Switzerland

2020

2019

Pension scheme contributions from employer

3 800

474

4 274

4 191

Total contributions

3 800

474

4 274

4 191

+/– changes in ECR through asset development, value adjustments etc.

– 111

– 111

0

Contributions and changes in employer contribution reserves

3 689

474

4 163

4 191

Decrease/Increase in company’s economic benefit from funding surplus

– 200

– 200

56

Decrease/Increase in company’s economic obligation towards funding shortfall

479

479

– 592

Change in economic impact on company of funding surplus/shortfall

– 200

479

279

– 536

Pension scheme expenses as part of personnel expense for the period

3 489

953

4 442

3 655

19. Other long-term receivables

19. Other long-term receivables

Other long-term receivables consist mainly of a CHF 29.6 million (prior year: CHF 31.1 million) remaining receivable from Canton Zurich in connection with the sale in 2016 of the former Uetikon operating site and the cost of cleaning up the adjacent lake bed (a total of CHF 32.0 million was originally retained in this regard from the sale proceeds of CHF 52.0 million). Following a downward adjustment of the originally estimated CPH share of the lake bed clean-up costs from CHF 32 million to CHF 20 million in May 2020, some CHF 12 million should be returned to CPH after the project’s completion in 2024. For further information see also Notes 25 and 27 on short-term and long-term provisions. The CHF 1.4 million of costs expected to be incurred in the following year (prior year: CHF 0.0 million) were reclassified as other short-term receivables.

20. Deferred tax assets

20. Deferred tax assets

Temporary differences deriving from an intragroup real estate transaction resulted in deferred tax assets of CHF 11.9 million for 2020 (see also Note 9). The remaining CHF 0.5 million of this item relates to further temporary differences arising from deviations between the group consolidated value and the tax value of assets, equity and liabilities.

21. Trade accounts payable

21. Trade accounts payable

in CHF thousand

2020

2019

To third parties

56 742

66 216

To related parties and companies

9

37

Total

56 751

66 253

Trade accounts payable declined in 2020 owing to the lower demand for the products of the Paper Division.

22. Other payables

22. Other payables

in CHF thousand

2020

2019

To third parties

4 576

3 636

To related parties and companies

0

0

Total

4 576

3 636

The increase in other payables for 2020 is due to higher customer prepayments in the Chemistry Division.

23. Accrued liabilities and deferred income

23. Accrued liabilities and deferred income

in CHF thousand

2020

2019

Accrued interest expense

495

497

Income tax owed

1 561

925

Accrued personnel expense

6 508

5 290

Other accrued liabilities and deferred income

8 251

9 541

Total

16 815

16 253

Accrued liabilities and deferred income increased by CHF 0.6 million as a result of higher income taxes owed and accrued personnel expense.

24. Short-term financial liabilities

24. Short-term financial liabilities

in CHF thousand

2020

2019

Towards third parties

8 088

5 889

– towards banks

7 818

5 532

– financial leasing liabilities

270

357

Total

8 088

5 889

Details of short-term financial liabilities are shown in Note 26.

25. Short-term provisions

25. Short-term provisions

in CHF thousand

Environmental protection measures

Restructuring provisions

Guarantee obligations

Other provisions

Total short-term provisions

Opening balance on 1.1.2019

0

637

567

0

1 204

Currency impact on opening balance

– 2

– 2

Additions

184

350

534

Use

– 344

– 151

– 495

Releases

2

2

Reclassifications

2 579

2 579

Currency impact on movements

0

Closing balance on 31.12.2019

2 579

477

766

0

3 822

Opening balance on 1.1.2020

2 579

477

766

0

3 822

Currency impact on opening balance

– 2

– 2

Additions

711

711

Use

– 556

– 37

– 207

– 800

Releases

– 2 023

– 302

– 2 325

Reclassifications

1 925

1 925

Currency impact on movements

0

Closing balance on 31.12.2020

1 925

440

966

0

3 331

The environmental protection measures relate to the lake bed clean-up at the former Uetikon site and to future waste disposal site obligations (see Note 27 for further details). The provisions for the clean-up of the Rotholz waste disposal site in Meilen were released in May 2020. The income expected from the sale of the Rotholz site should cover all its clean-up costs.

The restructuring provisions relate to the closure of the Uetikon site (and the associated lake bed clean-up).

The guarantee obligations stem from the Paper and Packaging divisions, and relate to any claims or entitlements arising from customer complaints.

26. Long-term financial liabilities

26. Long-term financial liabilities

2020 in CHF thousand

Current + 1 year

Current + 2 years

Current + 3 years

Current + 4 years

Current + 5 years

After + 5 years

Total 2020

Long-term bank loans

3 000

6 500

9 500

Corporate bond 1)

100 000

100 000

Financial leasing liabilities

164

82

246

Total

3 164

106 582

0

0

0

0

109 746

1) unsecured bond, SIX Swiss Exchange “CPH18”, issued 12.10.2018

2019 in CHF thousand

Current + 1 year

Current + 2 years

Current + 3 years

Current + 4 years

Current + 5 years

After + 5 years

Total 2019

Long-term bank loans

6 775

3 000

6 500

16 275

Corporate bond 1)

100 000

100 000

Financial leasing liabilities

249

164

82

495

Total

7 024

3 164

106 582

0

0

0

116 770

1) unsecured bond, SIX Swiss Exchange “CPH18”, issued 12.10.2018

Financial liabilities for 2020

Instrument

Currency

Amount in currency (thousand)

Amount in CHF (thousand)

Interest rate

Duration

Covenants

Short-term financial liabilities

Bank loan

CHF

1 500

2.41 

30.06.2021

1)

Bank loan

CHF

1 500

2.41 

31.12.2021

1)

Bank loan (PPPA paycheck protection program loan SBA US)

USD

1 550

1 370

1.25 

open

Industrial bond

USD

3 900

3 448

4.44 

01.08.2021

Financial leasing liabilities

CHF

270

various

Total

8 088

Long-term financial liabilities

Corporate bond

CHF

100 000

2.00 

12.10.2023

Bank loan

CHF

9 500

2.41 

20.03.2023

1)

Financial leasing liabilities

CHF

246

various

Total

109 746

Total financial liabilities

117 834

1) Repayment in steps; debt ratio max. 2.5 (from 31.12.2019). The debt ratio is calculated as follows: total financial liabilities/EBITDA for the Packaging Division for the last 12 months. This requirement was still being met as of 31.12.2020.

The CPH Group also has an additional CHF 40 million credit facility with Swiss banks.

Financial liabilities for 2019

Instrument

Currency

Amount in currency (thousand)

Amount in CHF (thousand)

Interest rate

Duration

Covenants

Short-term financial liabilities

Bank loan

CHF

1 500

2.41 

30.06.2020

1)

Bank loan

CHF

1 500

2.41 

31.12.2020

1)

Current account credit

CHF

1 796

3.90 

unlimited

Current account credit

USD

750

726

6.76 

unlimited

Current account credit

BRL

43

10

unlimited

Financial leasing liabilities

CHF

357

various

Total

5 889

Long-term financial liabilities

Corporate bond

CHF

100 000

2.00 

12.10.2023

Industrial bond

USD

3 900

3 775

6.10 

01.08.2021

Bank loan

CHF

12 500

2.41 

20.03.2023

1)

Financial leasing liabilities

CHF

495

various

Total

116 770

Total financial liabilities

122 659

1) Repayment in steps; debt ratio max. 2.5 (from 31.12.2019). The debt ratio is calculated as follows: total financial liabilities/EBITDA for the Packaging Division for the last 12 months. This requirement was still being met as of 31.12.2019.

27. Long-term provisions

27. Long-term provisions

in CHF thousand

Major repairs and renovations

Environmental protection measures

Other provisions

Deferred tax liabilities

Total long-term provisions

Opening balance on 1.1.2019

3 702

38 093

1 095

7 062

49 952

Currency impact on opening balance

– 8

– 88

– 96

Additions

865

310

1 175

Use

– 358

– 358

Releases

– 8

– 615

– 623

Reclassifications

– 2 579

– 2 579

Currency impact on movements

– 1

– 2

– 3

Closing balance on 31.12.2019

3 702

35 156

1 943

6 667

47 468

Opening balance on 1.1.2020

3 702

35 156

1 943

6 667

47 468

Currency impact on opening balance

– 1

– 72

– 73

Additions

339

339

Use

– 294

– 294

Releases

– 12 000

– 1 755

– 227

– 13 982

Reclassifications

– 1 925

– 1 925

Currency impact on movements

– 1

1

0

Closing balance on 31.12.2020

3 702

20 937

186

6 708

31 533

The provisions for major repairs and renovations relate to the work required on the Perlen weir. The corresponding project was approved by Canton Lucerne in 2019, enabling the work to be performed in the next few years.

Environmental risks arise as a result of the Group’s business activities.

In connection with the CHF 52.0 million sale of the Uetikon operating site in 2016, provisions of CHF 32.0 million (80 % of the CHF 40.0 million estimated total costs) were made at the time for CPH’s share in the expense of cleaning up the adjacent lake bed. The remaining 20 % of these costs are being met by Canton Zurich. Since the site’s sale was concluded, a pilot project and inspections were conducted for the lake bed clean-up between 2016 and 2018. A tender invitation for the clean-up work was issued in 2019, and a study was also commissioned on the options available. In May 2020 Canton Zurich awarded the commission for the work to a general contractor. As a result of this, the Canton now expects the total cost of the work to be CHF 25.0 million, of which 80 % or CHF 20.0 million will be borne by the CPH Group. In view of this, the corresponding provisions were reduced by CHF 12.0 million, in the form of extraordinary income, in May 2020. The clean-up work is expected to commence towards the end of 2021, and will take about two years. The corresponding provisions amounted to CHF 19.0 million at the end of 2020 (prior year: CHF 31.4 million), of which CHF 1.4 million are short-term provisions and CHF 17.6 million long-term provisions. The use of these provisions since their creation in 2016 has been largely for the project work and the external consultancy and inspection services required.

The further CHF 3.8 million of provisions for environmental protection measures (CHF 0.5 million short-term, CHF 3.3 million long-term) relate to future waste disposal site running cost obligations and a possible transfer thereof to the Canton Zurich Waste Disposal Site Aftercare Fund.

“Other provisions” consist mainly of provisions for agency agreements in the Paper Division.

All provision amounts expected to be paid in the following year are reclassified as short-term provisions (see Note 25).

28. Purchase of business activities and minority shareholdings

28. Purchase of business activities and minority shareholdings

Perlen Packaging AG acquired the remaining 40 % of the capital of Perlen Packaging Anápolis Indústria e Comércio Ltda., Anápolis, State of Goia (Brazil) on 4 December 2020, and now wholly owns the company. The consideration amounted to CHF 1.6 million, of which CHF 0.3 million was accounted for in minority interest and CHF 1.3 million in goodwill.

The CPH Group acquired no business activities in 2019.

29. Additional corporate governance information

29. Additional corporate governance information

29.1 Capital structure

2020

2019

Share capital in CHF thousand

1 200

12 000

Registered shares issued

6 000 000

6 000 000

Nominal value per share in CHF

0.2

2.0

Market capitalization in CHF thousand

435 600

475 200

The registered shares of CPH Chemie + Papier Holding AG are listed on the SIX Swiss Exchange in the Swiss Reporting Standard segment. The company’s share capital amounts to CHF 1.2 million and is fully paid in. The share capital consists of 6 000 000 registered shares with a nominal value of CHF 0.20 each.

29.2 Transactions with related parties and companies

All balances and business transactions between companies within the scope of consolidation were eliminated during consolidation and are not shown here. As in the previous year, all transactions with related parties and companies in 2020 were conducted at market rates. The following transactions were effected for services rendered with companies associated with the CPH Group and members of its Board of Directors:

in CHF thousand

2020

2019

UBV Immobilien Treuhand Perlen AG, Root

99

145

UBV Immobilien Treuhand AG, Uetikon

0

19

Niederer Kraft Frey AG (Manuel Werder)

20

66

Weber Schaub & Partner (Peter Schaub)

42

66

Total transactions

161

296

Total open liabilities at year-end

9

26

As in the previous year, no loans or credits were granted to related parties in 2020.

29.2.1 Shares held by members of the Board of Directors and Group Executive Management

Shares held by members of the Board of Directors (including related parties):

Number of shares

2020

Name

Own

Related parties

Total

2019

Peter Schaub

0

400

400

400

Tim Talaat

9 140

43 076

52 216

52 216

Manuel Werder

7 200

42 820

50 020

50 020

Christian Wipf

400

0

400

400

Total

16 740

86 296

103 036

103 036

Shares held by members of Group Executive Management (including related parties):

Number of shares

2020 shares vested until

Name

2023

Later

2020

2019

Peter Schildknecht

793

0

993

200

Klemens Gottstein

397

0

397

0

Wolfgang Grimm

397

0

457

60

Richard Unterhuber

397

0

647

250

Alois Waldburg-Zeil

397

0

797

400

Total

2 381

0

3 291

910

CPH Chemie + Papier Holding AG introduced a long-term incentive (LTI) programme for the members of Group Executive Management in 2020. The general contractual foundations and the vesting conditions thereof are detailed in the Remuneration Report. A total of 2 381 shares with a vesting period of three years were awarded under the programme in 2020.

29.2.2 Significant shareholders and numbers of shares held

Name

2020

2019

J. Safra Sarasin Investmentfonds AG

300 250

300 250

Ella Schnorf-Schmid estate

429 320

429 320

Uetikon Industrieholding AG

2 999 800

2 999 800

Total

3 729 370

3 729 370

30. Net financial liabilities

30. Net financial liabilities

in CHF thousand

2020

2019

Liquid funds and securities

116 285

93 121

Short-term financial receivables

0

36

Total liquid funds and financial receivables

116 285

93 157

Short-term financial liabilities to banks

7 818

5 532

Short-term financial liabilities to others/financial leasing

270

357

Total short-term financial liabilities

8 088

5 889

Corporate bonds

100 000

100 000

Long-term financial liabilities to banks

9 500

16 275

Long-term financial liabilities to others/financial leasing

246

495

Total long-term financial liabilities

109 746

116 770

Net financial liabilities

1 549

29 502

EBITDA

55 151

87 994

Debt ratio (net financial liabilities/EBITDA)

0.0

0.3

31. Contingent liabilities and off-balance-sheet business

31. Contingent liabilities and off-balance-sheet business

31.1 Contingent liabilities

As in the prior year, there were no guarantees towards third parties as of 31 December 2020.

31.2 Pledged assets

Real estate of Jiangsu Zeochem Technology Co. Ltd. with a book value of CHF 3.2 million (prior year: CHF 2.4 million) was subject to a CHF 3.0 million (prior year: CHF 2.4 million) lien as of 31 December 2020. Liquid funds with a value of CHF 0.7 million are pledged.

31.3 Other off-balance-sheet obligations

Operating lease agreements with notice periods of more than one year amounted to CHF 0.8 million (prior year: CHF 1.0 million), and relate mainly to vehicle leases. They show the following maturities:

in CHF thousand

2020

2019

Below 1 year

421

405

1 to 5 years

330

615

Above 5 years

0

0

Total

751

1 020

Off-balance-sheet obligations relating to rental agreements amounted to CHF 4.0 million (prior year: CHF 4.7 million), and relate largely to rental agreements in Rüti (Switzerland), Utzenstorf (Switzerland) and Whippany (USA). They show the following maturities:

in CHF thousand

2020

2019

Below 1 year

1 159

926

1 to 5 years

2 788

3 211

Above 5 years

100

550

Total

4 047

4 687

Purchase obligations for the acquisition of tangible fixed assets and intangible assets totalled CHF 12.3 million as of 31 December 2020 (prior year: CHF 5.1 million).

31.4 Derivative financial instruments and foreign-currency hedges

As in the prior year, no derivative financial instruments subject to balance sheet reporting were held as of 31 December 2020.

Open foreign-currency hedges as of 31 December 2020

in CHF thousand

2020

2019

Instrument

Contract value

Positive replacement value

Negative replacement value

Purpose

Contract value

Positive replacement value

Negative replacement value

Purpose

Forward foreign-exchange contracts in EUR

91 888

0

1 392

Cash flow hedge

115 027

2 535

54

Cash flow hedge

Forward foreign-exchange contracts in USD

9 726

533

0

Cash flow hedge

15 321

175

7

Cash flow hedge

Total

101 614

533

1 392

Cash flow hedge

130 348

2 710

61

Cash flow hedge

The open foreign-currency hedges are forward contracts designed to secure future cash flows.

32. Net result per share

32. Net result per share

Net result per share is calculated by dividing the net result for the year by the average number of shares entitled to dividend issued, less any treasury shares. The company held an average of 474 treasury shares in 2020 (prior year: 816 shares). Since no authorized or conditional capital is currently outstanding, diluted net result per share is identical to the net result per share amount.

2020

2019

Net result as per consolidated income statement (in CHF thousand) after minorities

46 901

48 341

Weighted average number of shares entitled to dividend

5 999 526

5 999 183

Net result per share (in CHF)

7.82

8.06

33. Treasury shares

33. Treasury shares

2020

2019

in CHF thousand

Number

Transaction price (CHF)

Value (CHF thousand)

Number

Transaction price (CHF)

Value (CHF thousand)

Opening balance on 1.1.

572

79.20

45

1 063

79.08

84

Purchased

21 438

71.97

1 543

16 584

81.91

1 358

Sold

19 253

70.38

– 1 355

17 075

81.67

– 1 394

Share-based compensation

2 381

75.75

– 180

0

Profit/loss

– 26

– 3

Closing balance on 31.12.

376

72.61

27

572

79.20

45

The company held 376 treasury shares at the end of 2020 (prior year: 572 shares).

A total of 21 438 treasury shares were purchased on the SIX Swiss Exchange in the course of 2020 (prior year: 16 584 shares) at an average purchase price of CHF 71.97 (prior year: CHF 81.91) per share. A total of 19 253 treasury shares were sold via the SIX Swiss Exchange in the course of 2020 (prior year: 17 075 shares) at an average sale price of CHF 70.38 (prior year: CHF 81.67) per share. A total of 2 381 shares with a vesting period of three years were awarded in 2020 in the form of share-based compensation.

34. Subsequent events

34. Subsequent events

The Board of Directors of CPH Chemie + Papier Holding AG has proposed to the company’s shareholders to acquire Uetikon Industrieholding AG, which is presently the company’s largest shareholder, via a merger by absorption. Under the merger proposal, the shareholders of Uetikon Industrieholding AG will exchange their shares therein for a commensurate number of shares in CPH Chemie + Papier Holding AG, newly giving them a direct CPH shareholding. The proposal will be submitted to the shareholders concerned for approval at an Extraordinary General Meeting in early June 2021.

No further events occurred between 31 December 2020 and 12 February 2021 which would require adjustments to the book values of the Group’s assets, equity and liabilities or would need to be divulged here. There are also no exceptional pending business items or risks which would need to be mentioned in the income statement.

The Board of Directors approved these consolidated financial statements at its meeting of 12 February 2021. They are also subject to the approval of the Ordinary General Meeting.