Financial statements of CPH Chemie + Papier Holding AG

Additional information

1. Valuation principles used

1. Valuation principles used

These financial statements have been compiled in accordance with the provisions on business bookkeeping and accounting specified in the Swiss Code of Obligations (Article 957ff). The major balance sheet items have been capitalized as described below:

No cash flow statement or certain additional notes

Since CPH Chemie + Papier Holding AG provides consolidated financial statements in accordance with recognized (Swiss GAAP FER) accounting standards, it has – as permitted under the relevant legal provisions – elected not to provide details of auditors’ fees or a cash flow statement in the present accounts.

Financial assets and investments

Financial assets are stated at their nominal value less any value adjustments required. Investments are stated at their purchase price less value adjustments. Investments are valued individually if they are material, and are not usually grouped together for such valuation because of any similarity.

Treasury shares

Treasury shares are shown at their original purchase price. The treasury shares held are shown as a negative item in equity. If they are later sold, the resulting profit or loss is taken directly to voluntary retained earnings.

Share-based compensation

Share-based compensation is valued at the share price applicable on the shares’ assignment, and is shown under both equity and personnel expense. The definitively assigned shares are subject to a three-year vesting period, during which the number of shares assigned is not contingent on any further performance, results or other vesting conditions.

Foreign currency positions

Foreign currency positions have been translated into Swiss francs at the following conversion rates:

Foreign currency

2021 income statement

2021 balance sheet

2020 income statement

2020 balance sheet

EUR

1.0810

1.0360

1.0710

1.0820

USD

0.9140

0.9110

0.9380

0.8840

The balance sheet conversion rates are the rates that ruled on the balance sheet date of 31 December, while the conversion rates used for the income statement are the average rates for the full financial year.

2. Notes on the financial statements

2. Notes on the financial statements

CPH Chemie + Papier Holding AG domiciled in Root

The company employed an average of six persons in 2021 (prior year: six persons) in full-time-equivalent terms.

2.1 Net revenue from sale of goods and services

2.1 Net revenue from sale of goods and services

The CHF 5.1 million in this item (prior year: CHF 4.9 million) represents the net revenue from goods and services provided to subsidiaries by the holding company and invoiced accordingly.

2.2 Additions/Reversals of impairment losses on non-current assets

2.2 Additions/Reversals of impairment losses on non-current assets

An impairment of CHF 77.4 million was effected in 2021 to the investment in Perlen Papier AG, Root/CH in view of its negative equity development following an impairment to its fixed assets. At the same time, CHF 15.3 million of a previous impairment to the investment in Zeochem AG, Rüti ZH/CH was reversed in view of positive business developments. There had been no such adjustments in 2020.

2.3 Income from investments

2.3 Income from investments

This item includes the profit distributions by subsidiaries.

2.4 Interest income

2.4 Interest income

Interest income derives predominantly from intercompany loans. For 2021, these were subject to interest rates of between 1.00% and 2.25% (prior year: between 1.00% and 2.25%).

2.5 Other financial income

2.5 Other financial income

This item consists primarily of income from the net positive impact of currency movements on foreign-currency amounts held.

2.6 Interest expense

2.6 Interest expense

This item consists largely of the CHF 2.0 million (prior year: CHF 2.0 million) interest paid on the CHF 100 million 2.00% corporate bond (duration 12 October 2018 to 12 October 2023).

2.7 Other financial expense

2.7 Other financial expense

Other financial expense for 2021 consisted largely of ordinary financial expense of CHF 0.1 million (prior year: CHF 0.1 million). Other financial expense for 2020 additionally included currency losses of CHF 0.4 million.

2.8 Extraordinary, non-recurring or prior-period income and expense

2.8 Extraordinary, non-recurring or prior-period income and expense

No such amounts were earned or incurred in 2021 or 2020.

2.9 Cash and cash equivalents and assets held for short-term disposal with a quoted market price

2.9 Cash and cash equivalents and assets held for short-term disposal with a quoted market price

in CHF thousand

2021

2020

Cash and cash equivalents

32 592

52 156

Assets held for short-term disposal with a quoted market price

32

20

Total

32 624

52 176

2.10 Other short-term receivables

2.10 Other short-term receivables

Other short-term receivables consisted largely of value-added tax credits in both 2021 and 2020.

2.11 Long-term receivables from group member companies

2.11 Long-term receivables from group member companies

Long-term receivables from group member companies increased by a net CHF 23.6 million to CHF 359.7 million in 2021 as a result of investment needs.

2.12 Investments

2.12 Investments

Holding in 2021

Holding in 2020

Name and legal form

Domicile

Remarks

Currency

Capital in thousand

Capital/Voting rights

Capital in thousand

Capital/Voting rights

CPH Immobilien AG 1)

Root/CH

Founded 29.4.2021

CHF

500

100 %

Zeochem AG 1)

Rüti ZH/CH

CHF

1 000

100 %

1 000

100 %

Zeochem L.L.C.

Louisville/USA

USD

36 547

100 %

36 547

100 %

Jiangsu Zeochem Technology Co. Ltd. 1)

Lianyungang/CN

CNY

90 000

92 %

90 000

92 %

Zeochem d.o.o.

Zvornik/BA

Transferred 2021 to Zeochem AG

EUR

2

100 %

2

100 %

Perlen Papier AG 1)

Root/CH

CHF

81 000

100 %

81 000

100 %

Perlen Papier Immobilien AG

Root/CH

CHF

1 000

100 %

1 000

100 %

APS Altpapier Service Schweiz AG

Root/CH

CHF

100

100 %

100

100 %

Perlen Deutschland GmbH

Munich/D

EUR

100

100 %

100

100 %

Perlen Packaging AG, Perlen 1)

Root/CH

CHF

24 000

100 %

24 000

100 %

Perlen Packaging GmbH, Müllheim

Müllheim/D

EUR

1 300

100 %

1 300

100 %

Perlen Packaging L.L.C.

Whippany/USA

USD

1 000

100 %

1 000

100 %

Perlen Packaging (Suzhou) Co., Ltd.

Suzhou/CN

USD

13 000

100 %

13 000

100 %

Perlen Packaging Anápolis Indústria e Comércio Ltda.

Anápolis/BR

BRL

2 464

100 %

2 464

100 %

1) Directly held by CPH Chemie + Papier Holding AG

CPH Immobilien AG, Root/CH was founded on 29 April 2021. UBV Immobilien Treuhand Perlen AG was acquired with the merger of Uetikon Industrieholding AG of 11 June 2021. CPH Immobilien AG, Root/CH integrated the assets, equity and liabilities of UBV Immobilien Treuhand Perlen AG in a merger of 22 November 2021. Zeochem d.o.o., Zvornik/ BA was transferred by CPH Chemie + Papier Holding AG to its subsidiary Zeochem AG, Rüti ZH/CH at book value in the course of 2021. There were no changes in 2020 to CPH Chemie + Papier Holding AG’s directly held investments.

An impairment of CHF 77.4 million was effected in 2021 to the investment in Perlen Papier AG, Root/CH. At the same time, CHF 15.3 million of a previous impairment to the investment in Zeochem AG, Rüti ZH/CH was released from hidden reserves (see also Note 2.2).

2.13 Liabilities towards pension schemes

2.13 Liabilities towards pension schemes

As in the previous year, there were no liabilities towards pension schemes as at 31 December 2021.

2.14 Accrued expenses and deferred income

2.14 Accrued expenses and deferred income

Accrued expenses and deferred income for 2021 included accrued interest on corporate bonds of CHF 0.4 million (prior year: CHF 0.4 million), accruals on employees’ salary and vacation entitlements of CHF 0.5 million (prior year: CHF 0.6 million) and pending tax payments and miscellaneous amounts of CHF 0.3 million (prior year: CHF 0.3 million).

2.15 Corporate bond

2.15 Corporate bond

This item relates to the CHF 100.0 million 2.00% unsecured corporate bond (SIX code CPH18) issued on 12 October 2018 and maturing on

12 October 2023. The bond is listed on the SIX Swiss Exchange.

2.16 Share capital

2.16 Share capital

Share capital consists of 6 000 000 registered shares with a nominal value of CHF 0.20 per share.

Uetikon Industrieholding AG, which had previously been the main shareholder of CPH Chemie + Papier Holding AG with a holding of 49.99%, was acquired by the latter through a merger by absorption effective 11 June 2021. Under the merger transaction, the previous shareholders of Uetikon Industrieholding AG exchanged their shares therein for a commensurate number of shares of CPH Chemie + Papier Holding AG, and have thence held direct CPH shareholdings. For the shares held by members of the Board of Directors and other significant shareholders, please see Note 30.2 in the ‘Additional information on the consolidated financial statements’.

2.17 Legal capital reserves

2.17 Legal capital reserves

The capital contribution reserve derives from the reduction in the nominal value of the CPH share in 2018. Following a distribution to shareholders, it was reduced in 2021 to a small remaining amount.

2.18 Treasury shares (and share-based compensation)

2.18 Treasury shares (and share-based compensation)

CPH Chemie + Papier Holding AG held no treasury shares at the end of 2021 (prior year: 376 shares, acquired at an average purchase price of CHF 72.61 per share). A total of 5 593 treasury shares were purchased on the SIX Swiss Exchange in the course of 2021 (prior year: 21 438 shares) at an average purchase price of CHF 70.45 (prior year: CHF 71.97) per share, and a total of 3 287 treasury shares were sold via the SIX Swiss Exchange in the course of 2021 (prior year: 19 253 shares) at an average sale price of CHF 71.49 (prior year: CHF 70.38) per share. A further 1 341 shares of a total value of CHF 0.09 million (prior year: CHF 0.09 million) were assigned to members of the management of CPH Chemie +  Papier Holding AG; and a further 1 341 shares of a total value of CHF 0.09 million (prior year: CHF 0.09 million) were sold to subsidiaries for such assignment to their management members.

Guarantees to third parties

Guarantees to third parties

Contingent liabilities amount to CHF 31.5 million (prior year: CHF 37.9 million), of which CHF 21.5 million (prior year: CHF 27.9 million) consists of guarantees and securities issued by CPH Chemie + Papier Holding AG to Swiss banking institutions in respect of subsidiaries’ credit limits and overdraft facilities. CPH Chemie + Papier Holding AG has also provided a guarantee of CHF 10.0 million (prior year: CHF 10.0 million) to Canton Zurich should Zeochem AG be unable to meet the outstanding costs of the inspection, monitoring and clean-up of a waste disposal site.

Pledged assets

Pledged assets

Liquid funds with a value of CHF 0.7 million are pledged (prior year: CHF 0.7 million).

Joint and several liability

Joint and several liability

CPH Chemie + Papier Holding AG is jointly and severally liable towards the Swiss federal tax authorities in Bern for current and future value-added tax obligations of the CPH Group (group taxation).

Assets subject to reservation of ownership

Assets subject to reservation of ownership

The book value of leased tangible fixed assets amounts to CHF 0.1 million (prior year: CHF 0.0 million).

Leasing liabilities

Leasing liabilities

The liabilities on leased vehicles amount to CHF 0.1 million (prior year: CHF 0.0 million).

Remuneration of members of the Board of Directors and Group Executive Management

Remuneration of members of the Board of Directors and Group Executive Management

The remuneration paid to members of the Board of Directors and Group Executive Management is detailed in the Remuneration Report.

Subordination agreements

Subordination agreements

Subordination agreements have been concluded between CPH Chemie + Papier Holding AG, Perlen and its subsidiaries Zeochem AG, Rüti ZH amounting to CHF 40.0 million (prior year: CHF 40.0 million) and Perlen Papier AG, Root amounting to CHF 5.0 million (prior year: CHF 0.0 million).

Subsequent events

Subsequent events

No significant events occurred between 31 December 2021 and 11 February 2022.

In response to a cyber attack, the IT systems of the CPH Group were shut down in a controlled manner on 7 January 2022 and production had to be halted at the Perlen and Müllheim sites. Once the key IT systems were back in operation, production was resumed at the sites concerned in the course of 13 January 2022. The CPH Group does not expect this incident to have any material impact on its 2022 business results.