Annual Report 2009 (PDF | 5.8 MB)

Annual Report 2009 (PDF | 5.8 MB)
Georg Fischer
ANNUAL REPORT 2009
Adding Quality
to People’s Lives
Credo
Adding Quality to
People’s Lives
People all over the world expect Georg Fischer to make a significant contribution to meeting their needs now and in the future.
Comfort. A reliable supply of clean water is becoming a crucial
challenge. GF Piping Systems makes the worldwide supply of
drinking water easier and enables the transport of liquids for
industrial purposes.
Mobility. People are increasingly mobile, and they have ever
greater demands for comfort and safety in their vehicles. With
its highly stressable cast parts made of light metal and iron,
GF Automotive makes it possible to build passenger and commercial vehicles that are both lightweight and safe.
Precision. The serial production of consumer goods and highquality precision parts requires sophisticated manufacturing
technologies. GF AgieCharmilles provides the machines and
sys­tem solutions for producing the necessary moulds, tools and
parts.
Comfort
Mobility
Precision
Georg Fischer
At a glance
Sales 2005–2009
million CHF
Sales 2009 by region (in %)
(100 % = CHF 2.91 billion)
4500
America
10 %
Germany
35%
4000
3500
3000
2500
Asia / Australia
16 %
2000
6%
Switzerland
Rest of Europe
29 %
Austria
4%
1500
1000
500
0
2005
8%
Asia / Australia
7%
Rest of Europe
7%
07
08
09
08
09
Results 2005–2009
million CHF
Gross value added 2009 by region (in %)
(100 % = CHF 1.00 billion)
America
06
350
300
Germany
30%
250
200
150
100
50
Switzerland
20%
Austria
28%
0
–50
–100
–150
–200
Employees 2009 by region (in %)
(100 % = 12 481)
America
7%
–250
2005
Germany
06
07
Net profit
30%
EBIT
08 / 09 EBIT before special charges
Asia / Australia
Rest of Europe
Austria
17%
18%
7%
Switzerland
21%
Free cash flow 2005–2009
million CHF
300
250
200
150
100
50
0
–50
–100
–150
–200
2005
06
07
08
09
Georg Fischer
Financial overview
million CHF
million CHF
Corporation
2009
2008
Order intake
Orders on hand at year end1
2 906
475
4 462
560
Income statement
Sales
EBITDA2
EBIT before special charges2
Special charges2
EBIT
Net profit / loss for the year 2 906
106
-58
–143
–201
–238
4 465
400
227
–93
134
69
<
Cash flow
Additions to property, plant and equipment
148
Cash flow from operating activities 242
Free cash flow 94
243
197
–197
Statement of financial position
Assets
2 866
Net Operating Assets (NOA) 1 575
Equity
1 152
Net debt
472
3 291
1 906
1 404
546
Key figures
Return on Equity (ROE) % Equity %
Return on Net Operating Assets (RONOA) %3
Return on Sales (EBIT margin) %4
Cash flow from operating activities in % of sales –19
40
–3
–2.0
8
5
43
12
5.1
4
12 481
14 326
million CHF
million CHF
–118
82
1 073
77
103
972
CHF
CHF
–61
0
273
262
14
5
337
240
Employees at year end
Holding (statutory accounts)
Net profit / loss for the year
Share capital
Market capitalization as per December 31
Key figures per registered share
Net profit / loss for the year
Distribution (proposed) 5
Equity attributable to shareholder of Georg Fischer Ltd
Share price at year end
1 In 2008 change of definition for GF Automotive
2 The previously reported figures were reclassified to conform with the current year‘s presentation
3 Calculated on EBIT before special charges / NOA adjusted by impairment on Goodwill
4 Before special charges
5 In 2008 as reduction in par value
At a glance
Financial overview
Georg Fischer 1
Content
Business Report 2009
1–40
Financial Report 2009
Investor information
Grasping opportunities
worldwide
2
Shareholder‘s Report
41–109
42
Corporate Governance
45
4
Compensation Report
55
Energy: the market of
the future
8
Consolidated financial
statements
57
Corporate Report 2009
12
Financial statements
Georg Fischer Ltd
95
105
Interview with CEO
Yves Serra
22
Affiliated companies
Corporate organization
and structure
26
Index
110
Locally anchored, globally active
111
GF Piping Systems
28
GF Automotive
30
GF AgieCharmilles
32
Corporate publications
Disclaimer
Publisher‘s information
Sustainability
36
2 Georg Fischer
GRASPING OPPORTUNITIES WORLDWIDE
Germany
Intelligent gear systems
for hybrid drives
Hans-Jörg Beeck
» 24
“ GF Automotive is all
set for the hybrid
trend even today. ”
GRASPING
OPPORTUNITIES
WORLDWIDE
Germany
Biogas
Frederik Trockel
»8
USA
New dollars with
Swiss technology
Bill Cowan
» 24
“ The way the machine
works is imperfectly
perfect – I don’t know
another one that can
do it. ”
“ The demand is so
high that we could
build a second
plant today. ”
Nicaragua
Water tanks
Doña Selfida
» 35
“ The new rainwater
tanks are wonderful.
We always have
running water in the
house. We‘re very
grateful for that. ”
Germany
Lights on for finer cutting
Volker Reichmann
» 25
“ Laser technology
opens up completely
new segments for us. ”
Georg Fischer 3
Switzerland
Cars of the future
Leopold Kniewallner
Finland
Water supply for sea-going giants
Staffan Magnuson
» 18
“ Plastic or metal –
we‘ve been working
intensively for ten years
on this new direction
in ship-building. ”
» 10
“ Growing demand for
innovative cast
components in the
automotive industry. ”
China
Light-weight engines for China
Ruiping Wang
»
18
“ GF Automotive has
an excellent reputation in China. ”
Taiwan
Power-saving light sources
Woody Wang
Germany,
Austria, China
Casting network
Dirk Lindemann
»
15
“ This network is so
much more than
just the sum of its
parts. ”
Mali
Piping systems for gold mining
Holger Hoffmann
» 15
“ We‘re the only manufacturer
that processes this kind of
dual pipe system. ”
» 11
“ Our machines are
just the right thing
for the fast-growing
LED market. ”
India
India builds nationwide gas network
Shekhar Jagtap
»
25
“ Local players are
more successful in
India. ”
4 Georg Fischer
SHAREHOLDERS REPORT
Difficult year – turnaround in the second half 2009
The global economic crisis in 2009 had a far-reaching impact on Georg Fischer. Sales fell to CHF 2,906 million, 35 percent below the previous year. Adjusted for currency effects
and changes in the scope of consolidation, sales were down
33 percent.
GF AgieCharmilles was the hardest hit Corporate Group as
customers sharply reduced their investments across-theboard. GF Automotive was also seriously affected especially in
the first half. Car and truck manufacturers sought to reduce inventories in response to the massive drop in demand in the
European and North American markets. GF Piping Systems was
less affected owing to its broad end-market diversification and
its less cyclical demand pattern.
A comprehensive restructuring programme was swiftly
launched in the first half in order to secure cash and sharply
reduce costs. As a result, the Corporation reported a positive
free cash flow of CHF 94 million for the full-year 2009 and costs
were cut by CHF 430 million compared with the previous year.
After restructuring charges of CHF 90 million and goodwill impairment of CHF 53 million, the operating loss came to
CHF 201 million. The operating loss before these special charges came to CHF –58 million.
This includes currency losses of CHF 24 million stemming
especially from the significant depreciation of the euro compared to the CHF.
In the second half, the operating result turned positive
owing mainly to the cost-cutting measures which were taken.
The net loss for 2009 amounted to CHF –238 million (previous
year CHF +69 million).
The Board of Directors proposes to the Annual Shareholders Meeting to forgo any dividend for this year owing to the
2009 loss and the uncertain market conditions.
Restructuring programme
successfully implemented
The downturn which affected GF AgieCharmilles and GF
Automotive was the worst in 70 years. Customers focused on
securing internal liquidity as credit conditions worsened in the
first half. Destocking and sharp investment cuts by most customers led right to serious undercapacity in most plants of the
two Corporate Groups from the beginning of the year. GF Piping
Systems was also affected especially in its industrial applications but managed to limit the sales drop to 13 percent.
The restructuring programme launched by the Executive
Committee in the first half of the year was unprecedented in its
scope and reach, aiming at a sustainable reduction in overall
costs by CHF 350 million. The cost savings of CHF 430 million
made in 2009 also include temporary measures such as shorttime work and salary cuts for senior management and the
Board of Directors.
Most of the measures of the restructuring programme
have already been implemented and the remainder are in place
for full implementation early 2010. At year-end 2009, the headcount reduction amounted to 1,845, well in line with the
company’s plan calling for a reduction of 2,300 by mid 2010. All
the restructuring charges have been booked to the 2009 account.
Corporate Groups
GF Piping Systems reported sales of CHF 1,066 million, a
decline of 13 percent versus 2008 (17 percent adjusted for
currency fluctuations and changes in the scope of consolidation). After a slow first quarter, turnover stabilized and even
slightly increased during the second half. Geographically, sales
in Europe showed the biggest fall especially in Eastern Europe
and Russia, whereas Switzerland remained solid. Turnover in
America was also down owing to the poor economic climate.
Sales in Asia recovered in the second half, especially in China.
The planned cost-cutting measures have been fully implemented, including the merger in Italy of two manufacturing operations into one location in Busalla. Special charges of CHF 13
million were booked as well as a goodwill write-off of CHF 10
million. As a result, operating profit after one-off special charges stood at CHF 57 million.
Operating profit before special charges improved significantly in the second half, owing mainly to the prompt costcutting measures, reaching CHF 80 million (EBIT margin: 7.5%)
for the full year.
Customers are still hesitant to build up inventories, but the
backlog of investments in water infrastructure, new builds and repairs, is huge. As a clear leader in this sector, GF Piping Systems
should benefit from this situation going forward. New plants were
opened in China and India in 2009, and new market segments
such as cooling lines, ship maintenance systems and renewable
energies were established. They will add to the momentum. GF
JRG, acquired in October 2008, has also been successfully integrated within GF Piping Systems and performed very well.
Georg Fischer 5
GF Automotive was seriously affected by the across-theboard customer destocking in the first half which quickly followed the market downturn. Once the destocking phase was
over, the automotive-related output recovered somewhat. Truck
manufacturing levels, however, remained very low, affecting capacity utilisation in the iron foundries.
Sales in CHF stood at 1,261 million or 42 percent below
previous year. The operating loss before special charges stood
at CHF 60 million (previous year profit of CHF 78 million) but
showed a sharp improvement during the second half as costcutting measures started to show their effect.
The key measures of the restructuring plan have been implemented, including the sale of the aluminium foundry in
Gleisdorf (Austria) and the closure of the aluminium plant in
Montreal (Canada), which was moved to China. The restructur-
ing of the aluminium foundries in Garching (Germany) and Herzogenburg (Austria) started in 2009 and will last until mid-2010.
Restructuring charges of CHF 49 million were booked, leading
to a loss after special charges of CHF 109 million.
The activity level in the last few months in Europe has
shown a positive trend, though from a low level. This is also true
for mid-class and premium cars, segments which hardly were
boosted by scrappage schemes in 2009 and which comprise a
substantial part of the sales of GF Automotive. Consequently,
short-time work has been reduced or lifted altogether in several plants. The light metal plant of Suzhou, China is running at
full capacity, operates successfully and is proceeding with its
third extension. The new iron foundry in Kunshan started operation in May and is ramping up production in order to meet the
brisk demand.
Martin Huber, Chairman of the Board of Directors, and Yves Serra, President and CEO.
6 Georg Fischer
SHAREHOLDERS REPORT
GF AgieCharmilles suffered the worst market slump ever
recorded in the machine-tool business. Sales plunged by
47 percent to CHF 578 million. All markets suffered, especially
in Europe and the USA. In the second half, however, demand in
Asia and South America started to pick up.
Far-reaching restructuring measures has been taken. The
EDM product line was unified to avoid redundancies. Production
capacities in Switzerland were sharply reduced with the closure
of two machine manufacturing plants out of four in Schaffhausen and Geneva and all sales companies were streamlined. The
overall personnel reduction came to 23 percent in 2009. The full
effect, however, will show up on the bottom line as of the second
half of 2010.
Despite all these measures, EBIT before special charges
came to CHF –81 million. Special restructuring charges of
CHF 27 million were booked and a goodwill impairment of
CHF 43 million was taken, leading to an overall operating loss of
CHF –151 million.
GF AgieCharmilles has adapted its organization to the underlying shift of its markets towards Asia. The operational responsibility for all activities in that region, i.e. R&D, production
and sales, is now concentrated under one divisional head, based
in Shanghai. Also, despite intensive short-time work all through
the year, a whole range of new products were exhibited at the
EMO show in Milan last October. They include in particular an
innovative 3D laser structuring machine, a world first, and new
electro-erosion machines focused on very precise applications
such as the LED market.
Positive free cash flow and secured financing
Securing liquidity was the main priority in 2009 in the face of
difficult financial markets situation. Net working capital was reduced by CHF 245 million. Capex was cut by 39 percent or about
100 million. This was more than the 30 percent announced.
As a result and despite the losses, a positive free cash flow
of CHF 94 million has been achieved, and net debt actually decreased to CHF 472 million at year end. Moreover, the medium-term financing of the Corporation was secured in the second half through the successful placement of a CHF 300 million bond and the conclusion of a CHF 420 million syndicated
loan. The equity ratio itself remained a high 40 percent (previous
year: 43 percent), reflecting a solid balance sheet.
“ Georg Fischer reiterates its 2012
objective of an EBIT margin of
8 percent, assuming a sustained
market recovery as of 2011. ”
Strategic course maintained
Despite the recession, Georg Fischer continued to implement its strategy in 2009, which is to expand GF Piping Systems,
continue investments in future growth markets, especially in
Asia, and foster innovation across-the-board.
The share of GF Piping Systems in the total sales of the
Corporation increased in 2009 to 37 percent versus 28 percent
the previous year. This was due in part to the deep recession in
the automotive and machine-tool sectors but also to the acquisitions concluded in 2008 and integrated in 2009.
With 15 plants in Asia and two more coming on stream in
2010 in China, Georg Fischer is well-positioned to take advantage of the growth in that region going forward. Already in 2009
fully 15 percent of its sales were generated in Asia, up from 12
percent in 2008.
Georg Fischer 7
Outlook
Personnel changes and acknowledgements
The restructuring programme announced in May 2009 has
been largely implemented and the remaining measures will be
fully carried out as planned by mid-2010. The cost base was
substantially reduced in 2009, and Georg Fischer enters 2010 as
a leaner and fitter company. As shown in the second half of
2009, break-even can be achieved at the present volume. The
operational leverage in the event of a market recovery is therefore substantial.
Regarding 2010, demand has slightly improved in the last
few weeks and months on the back of rising production and investment levels in Asia as well as in several sectors in Europe,
including the car industry. Uncertainties definitely remain,
however, regarding currency and raw material trends. All in all,
the sustainability of this rebound needs to be confirmed during
the course of the year. If that were the case, achieving a positive
net result for the year would be possible.
Medium-term, GF sees grounds for optimism as Georg
Fischer is well-positioned to benefit from its strong Asia presence as well as from long-term trends in water conservation,
mobility and production efficiency. Given the sustainable cost
base reduction, the company reiterates its 2012 objective of
an EBIT margin of 8 percent, assuming a sustained market
recovery as of 2011.
There were no changes to the Board of Directors or the
Executive Committee in 2009. At the end of 2009, Ernst Willi,
Head of Corporate Development and member of the Executive
Committee, retired. As a long-standing member of the Executive Committee, he was a key driver in advancing Georg Fischer‘s
strategic goals and promoting its values. The Board of Directors
and the Executive Committee thank Ernst Willi for his great
commitment and successful work and wish him good health
and much happiness in the forthcoming new stage of his life.
Most of all, we want to thank all the employees of Georg
Fischer for their commitment and positive spirit facing adversity. Their understanding of and contribution to the far-reaching
corporate restructuring of 2009 has been decisive in implementing it successfully. May we also extend a word of thanks and
gratitude to our customers, partners and shareholders for their
trust during these trying times.
In the coming year, we will do everything in our power to
boost innovative thinking, customer service and teamwork
within the organization. We will further strengthen the trust of
shareholders, customers, business partners and employees
and master the challenges that no doubt face us in 2010. Georg
Fischer intends to emerge strengthened from the crisis and will
take advantage of every opportunity.
Martin Huber
Yves Serra
Chairman of the Board of Directors
President and CEO
8 Georg Fischer
GRASPING OPPORTUNITIES WORLDWIDE
Innovative solutions to cope with rising energy demand
ENERGY: THE MARKET
OF THE FUTURE
Our world is facing huge challenges in the field of energy.
Increasing demand, dwindling fossil fuel supplies and climate
change are all problems to which humankind needs to find
solutions. The largest increase in consumption comes from
the buoyant economies of Asia and other emerging countries.
The rapidly expanding middle classes are building more comfortable houses, buying their first cars and treating themselves to TVs and computers – while constantly increasing their
energy consumption, whether for gas to heat and cook, fuel for
the car or electricity for leisure electronics. The International
Energy Agency predicts that global energy consumption will
rise by around 45 percent in the next 20 years. All three Corporate Groups of Georg Fischer contribute innovative solutions that are instrumental in shaping the future – while still
protecting the environment.
GF Piping Systems
A PARTNER
FOR THE ENERGY INDUSTRY
In order for the global community to be able to conquer the
challenge of rising demand in a sustainable way, the proportion
of renewable energy used in Europe needs to increase sharply.
This involves the use of hydroelectric, geothermal and solar
power as well as biogas. As a leading supplier of plastic piping,
GF Piping Systems also supports renewable energy production;
these types of energy are often sourced from small and medium-sized providers.
One such example is Stadtwerke Mühlacker GmbH in Baden-Württemberg, Germany. This municipal works company
constructed a biogas facility in 2007 and now produces gas with
an energy value of five megawatts. “We wanted to improve our
mix of energy and reduce our dependence on natural gas suppliers,” explains Frederik Trockel of Stadtwerke Mühlacker. The
demand for “green gas” is now so high that “we could build a
second plant today,” he says after just three years of operations.
The raw materials to produce biogas grow near the plant.
Various plants that are fermented to produce biogas are now
being grown on previously unused arable land. The fermenter is
filled and the gas removed automatically – in Mühlacker through
piping systems from Georg Fischer.
“Our plastic piping has long been certified for traditional
methods of gas supply,” explains Ingo Pfirrmann, Market
Segment Manager for Water and Gas for GF Piping Systems in
Germany. “We have the know-how it takes to ensure that this
flammable gas can be transported into the facility securely and
without any danger.” As a system supplier, GF Piping Systems
can also provide suitable products for all substances needed in
operations of this kind, whether for gas, water, coolants or
chemicals. The customer benefits from a wide product range,
can obtain everything from a single source and need not worry
about compatibility. GF Piping Systems even delivers the necessary instrumentation and control technology.
Worldwide demand is growing
More and more energy suppliers are choosing to imitate
Stadtwerke Mühlacker by investing in their own biogas plants.
The governments of other European countries and the USA are
currently latching onto the trend. According to a report
published by the United Nations Environmental Programme,
this market is set to reach a volume of 500 billion US dollars by
2020. GF Piping Systems is very well placed to cater for this
demand and is expanding the energy business as an independent market segment. GF‘s specialists tailor all the processes
in this area as closely as possible to the needs of the industry –
from research and development to customer applications.
Georg Fischer 9
Biogas
Frederik Trockel
Mühlacker, Germany
“ The demand is so high
that we could build a second
plant today. ”
OUR
CONTRIBUTION
Georg Fischer contributes to the global demand for
energy and energy efficiency through a variety of
innovative solutions. Here are just a few examples:
Piping systems for renewable energy production
facilities
Cars of the future
Leopold Kniewallner
Schaffhausen, Switzerland
“ Growing demand for
innovative cast
components in the
automotive industry. ”
GF Automotive
SMALLER, LIGHTER, ELECTRIC
The growing concern about climate change and the sharp
rise in the price of oil in 2008 have sparked the trend to hybrid
drive systems and the manufacture of smaller and lighter cars.
Since GF Automotive has for many years geared its research
and development to lowering CO2 emissions and reducing car
weight, thereby contributing to more efficient fuel consumption,
it is very well prepared for this trend. GF Automotive is a leader
in the design of lightweight components, the use of bionics and
the application of composite casting techniques for cast components. GF Automotive has developed two particularly durable
and temperature-resistant cast alloys, SiMo 1000 and SiboDur.
And GF‘s engineers and casters will also be there to meet
the special demands of hybrid drive systems. “In the coming
Resource-efficient closed cycles for water
and other liquids
Energy-efficient engines and lighter components
for cars and trucks
Greater efficiency in foundries and multiple
heat usage
Reduction of energy consumption in EDM generators
High-precision machines for the manufacture
of LED-based lighting systems
years, our customers will mostly be demanding vehicle technologies that optimise combustion engines,” says Leopold Kniewallner, Head of GF Automotive‘s Central Laboratories in
Schaffhausen, Switzerland. “But we‘re already involved in the
development of pure electric drives.”
New roles for cast components
Experts agree that it will still be years before electric motors have a serious impact on the market share of classical
combustion engines. Combustion engines and gearing systems
are set to become much simpler – and ultimately even superfluous. On the other hand, stresses Kniewallner, “other components will become much more demanding. Carmakers will continue to need clever and highly stable solutions when it comes
to battery housings or electric engines.” And because the batteries will make cars heavier, all the other components will
need to be lighter. “Even if the combustion engine becomes less
important, the demand for innovative castings in the automotive
industry is set to continue,” says Kniewallner. A demand that GF
Automotive‘s engineers and casters are sure to meet with their
innovative solutions.
Georg Fischer 11
GF AgieCharmilles
MORE LIGHT –
AND POWER-SAVING TOO
In an average company, between 15 and 25 percent of
energy consumption goes on lighting. Energy-efficient lighting
systems are therefore gaining in importance, and the magic
word nowadays is LED, which stands for light-emitting diode.
Compared with a normal light bulb, light-emitting diodes
require eight times less power.
Billions of LEDs are already being built into flat-screen
TVs and computer monitors, they light the way on the road in
car headlights or traffic lights and they are part and parcel of
daily life as light sources for rooms or even street lighting for
entire cities. Forecasts are for the LED market to double between now and 2013.
rely on these two core technologies of GF AgieCharmilles in the
manufacture of the necessary components. “Our competencies
and machines are just the right thing for the fast-growing
LED market,” says Woody Wang, Managing Director of
GF AgieCharmilles in Taiwan.
A brilliant future for LEDs
Right now, demand from manufacturers of flat screens is
driving this market. But in the summer of 2009, China launched
a pilot project in which the lighting of ten cities is to be switched
over entirely to LEDs. LED street lighting is also gaining a
foothold in Europe, and LED lamps in private households are
increasingly regarded as an alternative to the unloved energy
saving bulbs. LED manufacturers are expecting sales to soar by
35 percent in 2010 alone. “We‘re proud we can contribute to the
development and even better use of LEDs,” says Wang, “and of
course we want to leverage our excellent position in this fastgrowing market.”
GF AgieCharmilles in demand
The electronics of LEDs are minuscule and have to be
manufactured in high-precision moulds. An international team
of specialists at GF AgieCharmilles responded rapidly to
this challenge. As a leading manufacturer of machine tools
featuring electric discharge machining and high-speed milling,
the Corporate Group has the necessary competencies to
provide the right solutions for this demanding task. Especially
in Taiwan, the largest producer of LEDs, leading manufacturers
Power-saving light sources
Woody Wang
Taipei, Taiwan
“ Our machines are
just the right thing
for the fast-growing
LED market. ”
12 Georg Fischer
CORPORATE REPORT
Corporate Report 2009
Corporation
In 2009, sales at Georg Fischer dropped to CHF 2.9 billion,
35 percent below the previous year‘s level of CHF 4.46 billion.
Adjusted for currency effects and changes in the scope of consolidation, sales were down 33 percent. As a consequence, the
operating result before special charges was CHF –58 million
(previous year: CHF 227 million). Including special charges of
CHF 90 million for restructuring and CHF 53 million for goodwill
impairments, the operating loss was CHF –201 million (previous
year: CHF 134 million), while net profit came to CHF –238 million (previous year: CHF 69 million).
In May 2009, Georg Fischer launched far-reaching measures, expecting restructuring costs of CHF 100 million and a
sales drop in 2009 of about one third compared with the previous year. Despite tough conditions, the operating result before
special charges was still positive in the second half, and GF generated a positive free cash flow of CHF 94 million for the full
year.
Sales. In the wake of the unprecedented market slump,
GF AgieCharmilles (–47%) was the hardest hit division as customers across the board sharply reduced their investments.
GF Automotive (–42%) was also severely affected, especially in
the first half. Car and truck manufacturers sought to reduce inventories as a reaction to the massive drop in demand in the
European and North American markets. GF Piping Systems
(–13%) was less affected owing to its broad end-market diversification and less cyclical demand pattern.
Results. Consequently, GF’s operating profit (EBIT before
special charges) came in well below the previous year’s level at
CHF –58 million (2008: CHF 227 million) for an operating margin
of –2 percent (previous year: 5.1%). Yet in the second half, all
three Corporate Groups improved profitability substantially. After an EBIT of CHF -63 million in the first half, GF achieved a
positive EBIT of CHF 5 million in the second half, both before
special charges. This proves that the break-even-level could be
reduced very quickly.
Structural programme. Georg Fischer was quick to react,
announcing a comprehensive structural programme in May
2009 in addition to the steps already started at the end of 2008.
The measures were unprecedented in their scope and reach,
encompassing cost-cutting measures, capacity and structural
adjustments and divestments. The objective is to post a positive
operating result and positive free cash flow in 2010 and, with the
aim of sustainably cutting overall costs by CHF 350 million by
2012, to achieve an EBIT margin of 8 percent by 2012 at the latest.
In 2009 costs were cut by CHF 430 million. About half these
cuts are sustainable, while the other half were achieved through
temporary measures such as short-time work and salary cuts,
starting with the Board and Executive Committee. At year-end
2009, the headcount reduction amounted to 1,845, well in line
with the company’s plan for a reduction of 2,300 by mid 2010.
Most of the measures envisaged in the restructuring plan have
already been implemented and those remaining are in place for
full implementation early 2010.
Special charges. The one-off costs for the structural programme amounted to CHF 90 million in 2009. Impairment tests
showed that the goodwill values of the Agie Charmilles Group,
System 3R (both GF AgieCharmilles) and Technoplastic Alprene
(GF Piping Systems) are not supported so that impairment
losses of CHF 53 million also had to be booked. These are a
consequence of the sharp fall in demand in the machine-tool
business worldwide and the collapse of the Italian market for
building technology, which placed considerable strain on the
restructuring of GF Piping Systems’ Italian business.
Net profit. Net profit in 2009 came to CHF –238 million
(previous year: CHF 69 million). This corresponds to a loss per
share of CHF –61 (previous year: earnings per share of CHF 14).
Dividends. The Board of Directors proposes to the Annual Shareholders Meeting that it forgo any dividend for this
year owing to the 2009 loss as well as the uncertain market
conditions.
Free cash flow. A huge achievement in such a difficult
year, GF generated a free cash flow of CHF 94 million (previous
year: CHF –197 million). This exceptional result is due mainly to
the decrease in net working capital of CHF 245 million, which is
well above the CHF 100 million target announced at the Annual
General Meeting of March 2009. In the year under review the
Corporation invested CHF 148 million (Capex), 39 percent less
than in 2008 (CHF 243 million), but still a considerable amount.
As a result net debts were reduced by CHF 74 million to
CHF 472 million.
Value added. The gross value added slumped by 33 percent compared with last year (CHF 1.5 billion) to CHF 1.0 billion.
Georg Fischer 13
The cost of materials and products was 42 percent lower than
the previous year. Operating expenses came to CHF 553 million,
again 34 percent below 2008. Personnel expenses fell by 19 percent in 2009, mainly due to extensive short-time work and layoffs. Up to 5,500 employees in Germany, Austria, France and
Switzerland have been on short-time work. Where short-time
work was not possible, working hours were reduced and wages
adjusted accordingly. The fixed salaries of the Corporation‘s
Executive Committee members and its 250 senior managers
were temporarily reduced by 10 percent as of May 2009. The
CEO waived 20 percent of his fixed salary and members of the
Board of Directors 20 percent of their cash compensation.
85 percent of gross value added was generated in Europe
(previous year: 88%). Germany (30%), Switzerland (28%) and Austria (20%) remain at the top of the list. These three countries
also accounted for 68 percent of all Corporation employees (unchanged over the previous year) at the end of the year under
review.
Financing. The mid-term financing of the Corporation was
secured by the successful issue of a CHF 300 million bond after
mid-year and the conclusion of a CHF 420 million syndicated
loan. At the moment, Georg Fischer has a favourable maturity
structure. The financing of the CHF 157 million bond that
reaches maturity in autumn 2010 is fully covered by existing
credit lines.
Balance sheet. Total assets decreased by CHF 425 million
to CHF 2.87 billion, mainly owing to inventories (CHF –224 million), trade accounts receivable (CHF –135 million) and operational losses which affected retained earnings (CHF –244 million). Equity therefore declined to CHF 1.15 billion (previous year:
1.40 billion) and now comes to 40 percent (previous year: 43%)
of total assets, what is a very solid and healthy balance sheet.
Exchange rate exposure. The GF sales figures were affected by negative currency effects of CHF 115 million. EBIT was
shaved by CHF 24 million, mainly because of the euro.
The strategy of Georg Fischer with regard to exchange rate
exposure is geared to reducing risk through global sourcing in
the currencies in which sales are generated. Where possible
and appropriate, Georg Fischer produces locally in its most important markets. This is one of the reasons why all three Corporate Groups are expanding their production capacity in Asia.
Nevertheless, owing to serious currency fluctuations, mainly of
the euro, exchange rates had a major impact at corporate level.
Strategy and targets. Despite the recession, Georg Fischer continued to implement its strategy in 2009. Expanding
GF Piping Systems, continuing investments in future growth
markets, especially in Asia, and fostering innovation across the
board are all part of that strategy.
The share of GF Piping Systems in the Corporation’s total
turnover increased to 37 percent in 2009 compared with 28 percent in the previous year. This is due in part to the deep recession in the automotive and machine-tool sectors, and in part to
the acquisitions concluded in 2008.
With 15 plants in Asia and two more coming on stream in
China in 2010, Georg Fischer is well-positioned to take advantage of the growth going forward in that region. Asia / Oceania /
Australia‘s share of total sales increased to 16 percent (previous year: 13 %), although the figures have been somewhat distorted by consolidation of the accounts in Swiss francs. Both the
euro and the US dollar lost value against the Swiss franc in the
period under review. In local currency terms, sales decreased
only 15 percent in Asia / Oceania / Australia and 28 percent in
America. Both these figures are well below the 33 percent sales
decrease of the Corporation as a whole. Sales in China grew
3 percent compared to last year.
Gross value added 2009 by region (in %)
(100 % = CHF 1,00 billion)
America
8%
Asia / Australia
Rest of Europe
Austria
7%
Germany
30%
7%
Switzerland
20%
28%
Sales 2009 by end consumer (in %)
(100 % = CHF 2,91 billion)
Others
5%
Energy industry
8%
Automotive /
Transport 47 %
Construction
industry 13%
Chemical /
Plastics 9%
Metal / Machines /
Equipment 18 %
14 Georg Fischer
CORPORATE REPORT
Europe’s share of total sales fell to 74 percent (previous
year: 78 percent), but nevertheless remains high. This is thanks
mainly to GF Automotive, whose key market is Germany, even if
its most important customers export more than half the
vehicles they produce on average.
Outlook 2010. Georg Fischer enters 2010 as a leaner and
fitter company. As shown in the second half of 2009, break-even
can be achieved at the present volume. Operational leverage in
case of a market recovery is therefore substantial.
Regarding the outlook for 2010, demand improved toward
the end of 2009, not just on the back of rising production and investment levels in Asia, but also in several sectors in Europe, including the car industry. Absolute levels are still way behind the
peaks of 2007 and the sustainability of the rebound will not become apparent until later in the year. If it were sustainable, the
operating result would probably exceed the current break-even
target for this year.
Mid-term, GF sees grounds for optimism as Georg Fischer
is well-positioned to benefit both from its strong Asian presence
and long-term trends in water conservation, mobility and production efficiency. Given the CHF 350 million cost base reduction, the
company remains committed to its 2012 objective of a 8 percent
ROS, conditional on a sustained market recovery as of 2011.
GF Piping Systems
Results. GF Piping Systems reported sales of CHF 1.066
billion, a decline of 13 percent over 2008. Operating profit before
special charges improved significantly in the second half, mainly owing to prompt cost-cutting measures, and reached CHF 80
million (7.5% ROS) for the full year. The EBIT margin in local
currencies was 9.2 percent.
wide with one new plant in Ratnagiri (India) and one in Shanghai
(China). The new plant in India will enable local customers to
satisfy the substantial and fast-growing demand for water and
gas utility products. Building Technology also performed very
well, thanks in part to Georg Fischer JRG, which was acquired
toward the end of 2008 and is now fully integrated. GF JRG,
which was mainly active in Switzerland and southern Germany,
has been actively taking advantage of the Group’s worldwide
sales network. Thanks to GF JRG, therefore, Building Technology increased its share of the GF Piping Systems portfolio to
one third.
Structural programme. All the cost-cutting measures announced have been fully implemented, including the merger of
two manufacturing operations at a single new location in Busalla (Italy) and the merger of two companies in Switzerland, both
focused on Building Technology. Special charges of CHF 13 million were booked, as was a goodwill write-off of CHF 10 million
related to the actions taken in Italy. As a result, operating profit
after one-off special charges stood at CHF 57 million.
GF Piping Systems
in CHF million
2009
2008
Sales
1 066
1 224
– Industry
353
458
– Utility
388
505
– Building Technology
325
261
80
122
598
691
4 317
4 736
236
291
94
112
Gross value added as measured
against personnel expenses
143
155
Return on Net Operating Assets
(RONOA)2
12
20
Return on Sales (EBIT margin) 1
8
10
EBIT1
Net Operating Assets (NOA)
Employees
in CHF thousands
Sales per employee
Gross value added per employee
Markets. After a slow first quarter, turnover stabilized and
even increased slightly during the second half. Geographically,
sales fell furthest in Europe, especially in industrial applications, which is linked to the capital goods industry, while the
building technology sector in Switzerland and southern Germany has proven remarkably resilient to the recession. Turnover in
America was also down owing to the poor economic climate.
Sales in Asia recovered in the second half, especially in China.
The unusually severe winter hampered sales in the utility
and gas market and infrastructure business. Over all, however,
GF Piping Systems strengthened its number one position world-
in %
1 before special charges
2 Calculated on EBIT before special charges /
NOA adjusted by impairment on Goodwill
Georg Fischer 15
Casting network
Dirk Lindemann
Germany, Austria, China
“ More than just the sum
of its parts. ”
With its commitment to continuous improvement,
GF Automotive switched from its previous materials-based
organisational structure to a process-oriented structure at the
beginning of 2009. Its business units are now called Sand
Casting, Pressure Die Casting and Gravity Die Casting and work
together in an international production network. „This network
is so much more than just the sum of its parts,“ explains Dirk
Lindemann, Head of Sand Casting.
One of the benefits of the network is increased customer
focus: the value chain has been improved and logistics optimised to ensure high delivery capability. The various plants
work together very closely, provide mutual support for technical
issues and lend assistance if temporary bottlenecks occur. This
network therefore not only boosts productivity and added value
at GF Automotive but also offers customers simpler supplier
handling.
In practice, the benefits offered lead to orders such as that
placed by one of the leading commercial vehicle manufacturers,
which is installing 77 chassis, gear and engine components
supplied by six GF Automotive plants in an all-wheel-drive
truck. Thanks to the new single-source support principle, this
customer now only has one point of contact, and its own development and logistics costs are therefore lower. „As we are experts in the key production processes in aluminium, magnesium and iron, we can offer our customers a tailored, harmonised solution for each vehicle,“ explains Dirk Lindemann.
Piping systems for gold mining
Holger Hoffmann
Kayes, Mali
“ Reliable quality. ”
In the emerging economies, growth has top priority. Work
safety and environmental protection usually come a poor
second. But some companies are pioneers in these areas.
AngloGold Ashanti (AGA), the world‘s third-largest gold producer, is now equipping one of its mines with technology from
GF Piping Systems.
The South African company operates the Semos gold mine
in the Kayes region in western Mali. One of its partners in
this venture, which employs around 2,000 people, is the government of Mali. A cyanide solution is used to separate the precious metal from the ore. Every precaution must be taken to
prevent this toxic chemical, which is used in the production
cycle, from leaking and harming both people and the environment. The mine will install a dual pipe system from GF Piping
Systems. “Our installation company recommended GF as an
excellent partner for this purpose,” says project Manager
Luyanda Xulu from AngloGold Ashanti. “That’s why we opted for
the dual pipe system.”
The installation is demanding because GF Piping Systems
supplies a completely unique pipe-in-pipe system in which
a highly stable, chemical-proof inner pipe is protected by an
outer pipe. Holger Hoffmann, Regional Sales Manager of
GF Piping Systems, explains: “We‘re the only manufacturer that
processes this kind of dual pipe system in two separate steps so
that only we are able to reliably check the quality of the joints of
the inner pipe.” He is confident that the dual pipe system in
Mali will last a good 25 years. The mine operators are not only
complying with a demand of the International Cyanide Management Code, but they are also helping to protect people and
the environment in Mali.
16 Georg Fischer
CORPORATE REPORT
Outlook. GF Piping Systems is well-positioned to serve
growing water needs as the backlog of investments in water infrastructure is huge – be they new buildings or repairs. In Industry, the recovery in microelectronics will benefit our Group, just
as new market segments such as cooling lines, ship repair systems and renewable energies will add volume in both Industry
and Building Technology. New plants in China and India were
opened in 2009 and will add to the momentum.
Outlook. GF Automotive intends to take advantage of the
favourable consumer market. The rise in activity levels in Europe seen in the last few months is a positive sign, even if it started from a low level. This is also true of premium cars and
trucks, two segments which did not receive a boost from scrappage schemes in 2009 and which account for a substantial part
of GF Automotive’s turnover. With the two plants in China,
GF Automotive covers all the most relevant technologies and
materials in what is now the world’s largest car market, and is
consolidating its position.
GF Automotive
Results. GF Automotive reported sales of CHF 1.261 billion, a decline of 42 percent over 2008. The operating loss
before special charges stood at CHF -60 million (previous year:
CHF 78 million) but showed a sharp improvement during the
second half as the cost-cutting measures started to take effect.
Markets. GF Automotive was hit by across-the-board
customer destocking during the first half-year, although car
production-related output recovered somewhat during the
second half. Truck manufacturers’ production levels remained
low, on the other hand, with the result that our iron foundries
were unable to work to capacity. In addition, falling metal prices
led to a decrease in sales price of 6 percent due to the contractual price adjustment mechanism.
The light-metal plant in Suzhou (China) is working to capacity, operates successfully and is going ahead with its third extension. The new iron foundry in Kunshan (China) commenced
operations in May and is ramping up production in response to
the brisk demand.
The current crisis has intensified the trend to lighter, more
fuel-efficient vehicles. GF Automotive is therefore working with
several customers on the development of light-weight construction solutions for future models.
GF Automotive
in CHF million
2009
2008
Sales
1 261
2 161
– Passenger cars
955
1312
– Trucks
223
680
83
169
– Non-automotive
EBIT1
–60
78
Net Operating Assets (NOA)
663
706
5 476
6 123
217
360
74
115
Employees
in CHF thousands
Sales per employee
Gross value added per employee
in %
Gross value added as measured
against personnel expenses
109
136
Return on Net Operating Assets
(RONOA)2
–9
10
Return on Sales (EBIT margin)1
–5
4
1 before special charges
2 Calculated on EBIT before special charges /
Structural programme. All the key measures of the restructuring plan have been fully implemented, including the
sale of the aluminium foundry in Gleisdorf (Austria) and the
closure of the aluminium plant in Montreal (Canada), which has
been moved to China. The restructuring of the aluminium
foundries in Garching (Germany) and Herzogenburg (Austria)
started in 2009 and will last until mid-2010. Restructuring charges of CHF 49 million were booked, leading to a loss after special charges of CHF –109 million.
NOA adjusted by impairment on Goodwill
Georg Fischer 17
GF AgieCharmilles
GF AgieCharmilles
Results. GF AgieCharmilles has just suffered the worst
market slump ever recorded in the machine-tool business.
Sales fell 47 percent to CHF 578 million and all markets were
affected, especially Europe and the U.S. EBIT before special
charges came to CHF –81 million.
Markets. Some markets such as Japan or Europe stalled
almost completely. This impacted not only on machine sales,
but also on the service business since the installed machines
are less in use. Demand in Asia and South America started to
pick up again in the second half.
Despite intensive short-time work throughout the year, a
whole range of new products was exhibited at the EMO show
held in October in Milan. Among them was an innovative 3D laser structuring machine – a world first – and new electro-erosion machines for maximum precision applications such as LEDs.
Structural programme. Deep restructuring measures
have been adopted. The EDM product line has been unified to
avoid redundancies. Production capacities in Switzerland have
been sharply reduced with the closure of two out of four machine
production plants in Schaffhausen and Geneva. Swiss production
of milling machines will take place in Nidau in future and that of
EDM machines in Losone. The Corporate Group headquarters
will be in Geneva. All the sales companies were streamlined making for an overall reduction in personnel of 23 percent in 2009.
Special restructuring charges of CHF 27 million were booked
and a goodwill impairment of CHF 43 million taken, leading to an
overall operating loss of CHF –151 million.
GF AgieCharmilles has adapted its organization to the underlying shift of its markets towards Asia. Operational responsibility for all activities in that region, in other words for R&D,
production and sales, is now concentrated under one head
based in Shanghai.
Outlook. The full impact of the restructuring measures will
not become apparent until the second half of 2010 at the earliest.
The traditional mould & die markets in Europe and the U.S. first
have to absorb their overcapacity, while the signals coming out of
China are positive. GF AgieCharmilles has launched some new
low-cost machines made in China which will add to our competitiveness and strengthen our position in boom markets such as
smart phones, LEDs and chips. Some rebound can also be seen
in precision manufacturing such as dental, aerospace or medical.
2009
2008
Sales
578
1 080
– EDM
176
407
– Milling
152
309
in CHF million
39
77
– Customer Services
211
287
EBIT1
–81
34
Net Operating Assets (NOA)
305
496
2 543
3 319
197
332
42
99
Gross value added as measured
against personnel expenses
65
115
Return on Net Operating Assets
(RONOA)2
–19
7
–14
3
– Automation / Tooling
Employees
in CHF thousands
Sales per employee
Gross value added per employee
in %
Return on Sales (EBIT
margin)1
1 before special charges
2 Calculated on EBIT before special charges /
NOA adjusted by impairment on Goodwill
Light-weight engines for China
Ruiping Wang
Suzhou, China
“ GF Automotive has an excellent
reputation in China. ”
Water supply for sea-going giants
Staffan Magnuson
Helsinki, Finland
“A new direction in ship-building.”
The cruise industry is used to superlatives. The ships are
bigger, more exclusive and costlier than ever. But in December
2009, the Oasis of the Seas indisputably broke every record. The
new flagship of the American-Norwegian Royal Caribbean
Cruise Line (RCCL) beats them all – in length (361.8 metres),
height (65 metres), number of passengers (5,400) and, of course,
the facilities.
To take care of water supply on board the ocean-going
giant, the ship-builders STX Finland Cruise Oy turned to
their long-standing partner GF Piping Systems. The physical
dimensions of the order –165 kilometres of pipes, 8,200 ball valves and 370,000 fittings – put it in a completely different
league. “But the real challenge was elsewhere,” says Staffan
Magnuson, Sales Manager Ship-Building at GF Piping Systems
Sweden: “A fundamental decision was taken to get away from
metal and go for plastic piping. We‘ve been working intensively
for ten years on this new direction in ship-building.”
The owners were helped in their decision by the plastic
pipes from GF that have been installed in the last three of
RCCL‘s new ships. Kari Pihlajaniemi, project manager at RCCL,
puts it succinctly: “The successful long-term tests in the other
ships plus the reliability, availability and costs over the entire
life cycle were the decisive factors for us in choosing GF Piping
Systems.” The main problem with conventional metal pipes is
corrosion. The pipes are rusted by moisture, high temperatures
and the salt water.
“Over the years, GF Piping Systems has gained a competitive edge in know-how,” says Magnuson. This lead has made
GF Piping Systems the development partner of the shipyard,
which is already working on sister ships of the Oasis of the Seas.
Technology from GF will also be on board these ocean giants.
Light-weight, fuel-efficient automotive technology counts
not only in the traditional markets of Europe and the USA. In
China, too, the world‘s largest automotive market, customers
are looking for cars that offer fuel economy and low emissions.
The government is even encouraging people to buy models with
engines no larger than 1.6 litres. These relatively small engine
blocks have to be lighter, and so carmakers are increasingly
replacing the cast iron block by an aluminium version that
weighs almost half as much. Chinese manufacturers used to
buy such engines in Korea and Japan; now they produce them in
China. That‘s how the GF Automotive light-metal foundry in
Suzhou won Great Wall Motors (GWM), China‘s leading carmaker, as a customer. Every month since the start of the year,
GF Automotive has been supplying GWM, whose sales soared
77 percent in 2009, with 20,000 oil sumps and engine blocks
with 1.1, 1.3 and 1.5 litre engines.
The early presence of GF on the Chinese market is paying off as it gave the company a lead over its competitors.
“We work together with Georg Fischer because of its many
years‘ experience in manufacturing aluminium engine blocks.
GF Automotive has an excellent reputation as a supplier to the
leading European carmakers,” says Ruiping Wang, General
Manager of the GWM engine plant, explaining the decision.
The engine blocks are mainly used in compact models
such as the Gwperi, Florid and Coolbear. The Phenom, which
Great Wall Motors plans to distribute on the EU market starting
in 2010, will also contain castings from GF Automotive.
KONZERNBERICHT 2009
Markets and customers
Customer satisfaction. Georg Fischer’s Corporate Groups
conduct regular surveys among their target groups, thereby adding to their knowledge of the market and improving their assessment. In the past year, for example, GF Automotive conducted structured interviews with all key customers and external
specialists. The results were used for the continuous improvement of customer relations.
Another yardstick of customer satisfaction are the awards
given by customers and professional associations. In 2009,
GF AgieCharmilles demonstrated its technological leadership
once again, earning a EuroMold Award for its new laser products and technology. The awards, known among industry
experts as the “Oscar of application development,” honour the
three best products and services exhibited at EuroMold, the
international fair for mouldmaking, tooling, design and application development.
GF Automotive received the 2009 Castings Supplier of the
Year award at Knorr-Bremse Suppliers‘ Day. GF Automotive in
Singen (Germany) supplies cast-iron brake calipers to the
Knorr-Bremse plant in Aldersbach (Germany). Knorr-Bremse is
a worldleader in the manufacture of disc brakes for heavy goods
vehicles. Given the difficult circumstances in 2009, the award
reflects the GF’s high standards and commitment to its
customers.
Global presence. Georg Fischer maintains a global presence, with a sales and service network encompassing some 200
sites worldwide. Accounting for 35 percent of sales (previous
year: 40%), Germany remained the Corporation’s most important market. Europe’s share of total sales decreased slightly to
74 percent (previous year: 78%) due to the deep recession. Asia /
Oceania / Australia increased its share to 16 percent (previous
year: 13%), while America’s rose to 10 percent (previous year:
9%). In Asia, Japan was hit just as badly by the recession as
Europe, while sales in China grew 3 percent in local currency.
In the year under review, all three Corporate Groups expanded their production and distribution structures in Asia,
which was not as badly hit by the worldwide crisis and confirmed its position as the main growth market. GF Piping
Systems now has 12 plants in Asia, 10 of them in China, one in
Malaysia and one in India. In 2009 it opened new plants in
Ratnagiri (India) and Shanghai (China). GF Automotive runs
2 plants in Asia, both of them in China. The light-metal foundry
in Suzhou is going ahead with its third extension; the iron
Georg Fischer 19
foundry in Kunshan commenced production officially in May
2009. GF AgieCharmilles has been producing EDM machines in
Beijing since 1994 and in the year under review commenced the
production of milling machines in Beijing, too. Once the volume
has exceeded current capacity, milling machine production will
move to Changzhou. GF employs now more than 2,000 people,
or 18 percent of its workforce, in Asia.
Brand policy. The Georg Fischer corporate brand enjoys
an excellent reputation and widespread recognition. The Georg
Fischer corporate logo, which has been a protected trademark
since 1902, is central to the image projected by all three Corporate Groups. The Patent department systematically takes legal
action against all imitations and forgeries.
The Corporation supports the perception of the corporate
logo by a number of appropriate measures, in particular clear
rules as to its use and an active approach to corporate communications. Regular polls are conducted in Switzerland and Germany
to facilitate the continuous improvement of our brand strategy.
The efforts of Georg Fischer to report transparently about
its own work received several awards in 2009. In this connection, the Corporation attaches great importance to its Internet
website, which it is constantly developing. These efforts have
gained public recognition. Georg Fischer won first place for its
internet site in the joint annual report rating of the Swiss business magazine Bilanz and the Harbour Club, the professional
association of Swiss heads of corporate communications. The
GF Internet site stands out for its „generally high level“ and
there are „brilliant gems“ in its reporting, said the jury.
The Northwest Switzerland University of Applied Sciences
also singled out Georg Fischer’s 2008 Annual Report for praise,
awarding it 275 out of a possible total of 317 points.
Innovation
Research and development. In 2009, Georg Fischer invested CHF 116 million in research and development. This equates
to over 4 percent of sales. Spending on research and development is not capitalised as an asset on the balance sheet, but
is booked to the income statement as expenditure. A total of
500 employees work in research and development for the
Corporation.
As a Swiss company, GF regards innovation as crucial to
the Corporation. R&D centres are established on three continents, where engineers work hand-in-hand with the local
20 Georg Fischer
CORPORATE REPORT
sales force and customers. GF will continue to decentralise in
order to speed up the innovation process. On average, 25 new
patent applications are filed every year, reflecting the
Corporation’s innovativeness.
Innovation strategy and rate. GF Piping Systems is growing with the water cycle and hence the worldwide demand for
clean drinking water. This core competency is being pooled and
expanded at the GF Piping Systems Technology Centre in
Schaffhausen, Switzerland. As the innovation and technology
pivot, the Technology Centre focuses primarily on materials
and jointing technology. In 2009, the Corporate Group spent
CHF 23 million on R&D.
R&D at GF Automotive is geared to trends in automotive
engineering: the sparing use of resources, increased safety and
greater comfort. In vehicle construction, the customer and supplier work together closely from an early stage. About half the
R&D expenditure at GF Automotive is invested in the next product generation, a third in later generations and the remainder
in the improvement and development of existing products.
In 2009, the Corporate Group spent CHF 52 million on R&D,
technical product management and production process
management.
In the most important customer segments of GF AgieCharmilles, the key trends – miniaturisation, greater precision,
speed and system availability – continue without let-up. Electric
discharge machining is a highly sophisticated technology in
which enhanced machine performance is opening up new applications. High-speed milling increasingly benefits customers in
the manufacture of precision and miniature parts made of highquality materials. GF AgieCharmilles is focusing on this aspect
in its innovation drive. In the year under review, about
40 percent of the machines sold had been on the market for
less than three years. In 2009, the Corporate Group spent
CHF 41 million on R&D.
Synergies. Georg Fischer manages the Corporate Groups
so that the units can each pursue their individual strategic and
operational targets. In the year under review GF started an
ambitious programme to standardise a considerable part of its
enterprise support processes and services, starting with travel
management and IT. It is the objective of the corporate synergy
projects to exploit step by step the potential for improvement
from shared services and standardised support processes.
Specialists from GF Automotive and GF AgieCharmilles
co-operate in the area of metal-machining and mould-making
at GF Automotive. As a world leader in the manufacture of
machining equipment, GF AgieCharmilles has specialists
whose know-how is now benefiting the production processes of
GF Automotive.
Products and processes
Bacteria-free water. For GF Piping Systems, the acquisition of JRG AG (Switzerland) marks a giant step forward in Building Technology. JRG’s LegioTherm system is an attractive solution to an age-old problem: the need for water in pipes to be
perfectly clean so that there is no chance of bacteria and other
germs lurking in sanitary installations.
The LegioTherm system ensures that germs such as lifethreatening legionellae have no opportunity to multiply and
spread. LegioTherm is increasingly becoming the application of
choice for senior citizen’s homes, hospitals and hotels. Thanks
to LegioTherm, the circulation and disinfection temperature can
be set, as can the duration of thermal disinfection. This data can
be stored and then later analysed using a computer. GF Piping
Systems, with its worldwide sales channels, is in a position to
market these patented systems all over the world.
Expanded value chain. GF Automotive is known first and
foremost as a good foundry group. But customers expect more
than just a ready-to-assemble product from their key partners.
As a result, GF Automotive started years ago developing knowhow in areas such as coating, finishing and subassembly.
Nowadays, GF Automotive foundries deliver about 60 percent of
its components machined or with “added value” in other technical areas. The advantages are significant for both supplier
and customer: quick feedback between casting and machining,
less scrap, reduction of logistics and inventory costs.
Time to market. GF AgieCharmilles recently demonstrated its technological leadership with a new laser line which
adds to and extends the existing range. The new laser technology enables the texturising, engraving, microstructuring,
marking and labelling of 2D and even complex 3D geometries.
GF AgieCharmilles’ laser ablation for product individualisation,
meanwhile, has clear economic, ecological and design advantages over conventional surface treatment using the etching
method.
The project kicked off in March 2009. Despite the restrictions of short-time work, the first prototypes of the new ma-
Georg Fischer 21
chine were available in July and the laser ablation technology
was unveiled as a world premiere at the EMO in Milan in October 2009. One key customer was closely involved in the development of this new technology (see page 25).
Risk management
Risk control. Georg Fischer has adopted a strategy of
risk control, for which it employs a range of risk management
tools. These include systematic identification, evaluation and
reporting on strategic, operational and financial risks as well
as generally ensuring comprehensive and efficient insurance
coverage. Georg Fischer identifies all relevant risks in the areas
of strategy, markets, management and resources, operations
and finance on a consistent basis throughout the corporation.
Risks are assessed and illustrated on so-called “risk maps” in
accordance with their possible consequences and likelihood of
occurrence.
Reporting. The strategic risks are assessed primarily by
the Board of Directors, and the financial and operational risks
primarily by the CEO and the Executive Committee. Risk management is largely integrated in existing planning and management processes. Other units in addition to Risk Management are involved at the Corporation level: Corporate Controlling, Corporate Compliance, Human Resources, Corporate
Audit, Communications, Planning, Legal and Treasury.
Risk analysis. Generally speaking, risks can never be
completely ruled out in production, and this is particularly so in
the foundries. The careful analysis and minimisation of risks increases process security and thus improves reliability of delivery to customers. Georg Fischer attaches very great importance
to these aspects. The standard of risk management at virtually
all production sites is either HPR (Highly Protected Risk) or
HMP (Highly Managed Prevention) and is regularly audited by
external specialists. In the year under review, 20 (previous year:
15) production sites out of a total of 42 (previous year: 41) underwent such audits. The results are discussed with the units
concerned and with the management. Wherever necessary,
corrective measures are agreed.
Risk standards. In consultation with the corporate subsidiaries and Corporate Groups, Risk management has drafted
technical and organizational standards for the entire Corpora-
tion which serve as an internal basis and as a norm in dealings
with external consultants and insurers. These Corporation-wide
standards prescribe measures for the Georg Fischer sites
which are to be carried out in order to avoid major production
outages and to preserve the Corporation’s assets. The Highly
Protected Risks (HPR) standard applied to 74 percent of the
Corporation’s insured assets at the end of the year under review. This percentage is continuously being increased by means
of appropriate operational measures.
Investments
Property, plant and equipment. During the year under
review, the Corporation’s investments in property, plant and
equipment amounted to CHF 148 million. GF Piping Systems
accounted for 25 percent of the total, GF Automotive for 69 percent and GF AgieCharmilles for 2 percent. 67 percent of the total was invested in Europe. The largest single project in 2009,
however, was the new iron foundry in Kunshan (China), which
commenced production officially in May 2009. Most of the
capital spending went on product and process innovation and on
investments to upgrade and streamline production processes.
Investment volume in 2010 will be similar to the 2009 level.
GF will proceed at the same pace, completing the third extension of the aluminium foundry in Suzhou, adding a new pipe plant
in Beijing and commissioning the new milling machine plant in
Changzhou (all three in China). A large part of the investments,
especially plant upgrades, will again be made in Europe.
GF Piping Systems will expand its production capacity wherever
needed, including in larger components.
22 Georg Fischer
INTERVIEW WITH CEO YVES SERRA
“ We are determined to succeed ”
Interview with Yves Serra, CEO
Mr Serra, 2009 was an extraordinarily demanding year.
What was the major challenge?
We had to adapt quickly. In this case that meant cutting
costs and saving cash in order to master the dramatic change in
market conditions we experienced in 2009. But doing so calmly,
respecting our values and with an eye to preparing for the future, beyond the downturn.
How did you allocate your time in 2009?
During periods of uncertainty, it is important to remain
present and visible. Like my colleagues on the Executive Committee, I spent fifty percent of my time visiting our companies
and our customers in 2009. For our companies, the purpose
was to inform, clarify, support and encourage. For our customers, it was important to demonstrate the financial stability
of our corporation, but also to feel their changing needs and
quickly act upon them.
More than 250 managers agreed to voluntarily cut their salaries by 10 percent. Why did you ask them to do so?
As managers, we are role models. The number of employees working short-time increased in the first quarter of 2009 to
about 5,500, or close to half of our workforce.
I thought that in such an exceptional situation senior management, and in the first place the CEO and the Executive Committee, should carry their part of the burden. I therefore proposed a salary cut of 20 percent for me and 10 percent for senior management, a proposal that was accepted by almost all
senior managers. And incidentally, the Board of Directors also
reduced their cash compensation by 20 percent.
This measure, whilst helping to cut costs, also went a long
way to showing everyone, inside and outside the corporation,
our determination to succeed.
Could you elaborate on the “Winning in the downturn”
programme?
At the beginning of the year we launched a company-wide
contest called “Winning in the downturn”, aimed at drawing out
the best contributions in that respect and rewarding it accordingly. It was a way of rallying all energies in a positive manner,
promoting teamwork and encouraging new ideas. New revenue
streams were identified and developed, including in countries
and sectors which suffered the worst market slump. All
companies participated. The response was very positive and the
awards will be presented in March at the 2010 Corporate Convention.
Going forward, what are the priorities at Georg Fischer?
As a Swiss company, innovation has to take centre stage.
We now have R&D centres in three continents which collaborate among themselves and work hand-in-hand with our local
sales force and customers. We will certainly put the emphasis
on nurturing our key know-how, but also on decentralising R&D
because this speeds up our innovation process.
The second priority is customer focus and teamwork. We
have 130 companies worldwide. If we want to serve our customers more quickly and better than the competition, a spirit of
mutual support and collaboration is essential. Our internal training efforts will be intensified accordingly.
“ We must certainly maintain
a good balance and a wide
presence worldwide. ”
Finally, the recession has simply accelerated our end markets’ shift towards Asia. China became the largest market for
cars in 2009, and has been the largest machine-tool market for
quite some years – to say nothing of Asia’s huge general need
for housing and water infrastructure. We will continuously adapt ourselves to this shift.
That said, we must certainly maintain a good balance and
a wide presence worldwide, especially in our major markets in
Europe and the U.S.
How do you want to capitalise on the growth markets of Asia?
During the recession, we continued and intensified our investments in Asia. We now have 15 plants in Asia, 30 companies
and more than 2,000 employees. We will go on adding facilities
in Asia because it makes economic sense to produce locally for
the Asian markets.
We have also organized ourselves in the Corporate Groups
to bring all functions in Asia – i.e. R&D, production and sales –
under one manager, based in Shanghai. And we have done so to
act quickly on local needs.
Georg Fischer 23
“In 2009 we did our homework and the corporation is now leaner and better prepared for the future”, says Yves Serra,
CEO of Georg Fischer. Picture taken at the International Alpensymposium in Interlaken (Switzerland), 19 January 2010.
What are our intentions regarding Europe?
Our roots lie in Switzerland. Our key customers, a major
part of our turnover as well as our production are in Europe,
and our core R&D facilities too. We will continue to produce in
Europe for the European markets. Key components will also
continue to be developed and produced in our European plants.
In that sense, every product we manufacture in Asia, every order we get, attracts key components made in Europe or the U.S.
– such as Swiss-made spark generators for EDM machines, or
complementary products like the water sensors that we make
in the U.S. A good part of our contracts at GF Automotive in Asia
stem from our long-standing contacts with European automobile manufacturers. It is vital to nurture them.
And what about the Americas?
The U.S. and the Americas in general will remain a vibrant
and dynamic region whatever the temporary uncertainties. We
have substantially increased our turnover in that area thanks to
our two acquisitions in North America in 2008. But our presence
is not yet in line with its market potential. It is therefore our intention to increase our revenues from the Americas.
What is the outlook for 2010 and beyond?
We did our homework during 2009 and the corporation
is now leaner and better prepared for the future. There are
signs of a rebound, particularly in Asia. Nevertheless, we
have to brace ourselves for some ups and downs in the markets
in 2010. Despite the positive signs in the economy, customers
are still cautious about investments and inventory build-up.
So it is important to remain vigilant with regard to costs and
cash outlays.
That said, the long-term chances of Georg Fischer are intact. GF Piping Systems is a leading actor worldwide in the whole water cycle, which is definitely a long-term growth market.
Access to car ownership is a universal aspiration, and production efficiency is certainly a key topic for GF Agie Charmilles’
customers.
It is up to us to remain flexible, continuously adapt ourselves and seize all these chances.
Mr. Serra, thank you very much for talking to us.
Last question: What are your personal objectives for 2010?
Stay healthy, keep my family happy and make GF prosper.
24 Georg Fischer
GRASPING OPPORTUNITIES WORLDWIDE
New dollars with Swiss technology
Bill Cowan
Philadelphia, USA
“ Imperfectly perfect. ”
In 1907, the President of the United
States, Theodore Roosevelt, had the
idea of minting coins to serve as his
country‘s ambassador. He believed that
coins could be the most visible and tangible representatives of the land and he
ordered an impressive coin to be struck
that had an especially high relief. However, production technology was not up
to realising this ambitious idea, and only
a few handmade samples were ever produced. It was not until 2009 that the United States Mint succeeded in producing
the Ultra High Relief Double Eagle gold
coin efficiently – with technology from
GF AgieCharmilles.
Bill Cowan from Holco, the distribution partner of GF AgieCharmilles in the
USA, supplied the United States Mint
with the necessary high-speed milling
machines. “Some of the lines are so fine
that an exact reproduction of the original
is really impossible,” says Bill Cowan.
“We digitised the entire process. A com-
puter digitally maps the original and
controls the machines. To retain the
original‘s artistic aspect, we can even
build in a small amount of imprecision –
the way we work is imperfectly perfect.”
Despite modern digital technology,
it took ten years to perfect the process
to the point where the coining dies
could strike large series of the handshaped, ultra-high relief and complicated double eagle coin on the gold blanks,
without missing any of the details. Collectors are certainly not wrong in believing that this coin, showing Lady Liberty
on the obverse, is one of the most beautiful ever minted. Bill Cowan is satisfied:
“The process is highly complex, but
the machines are incredibly precise.
Four manufactures competed to produce
the dies and only GF AgieCharmilles
met the requirements of the United
States Mint.”
Of course, the day-to-day business
of the United States Mint looks some-
what different. Since 1792, it has been
supplying the population with money
for commercial purposes. Nowadays, it
strikes up to 20 billion coins a year. Since
2009, the dies for these everyday coins
have all been cut on machines from
GF AgieCharmilles. So, millions of US citizens carry around a small piece of Swiss
precision in their wallets every day.
Intelligent gear systems for hybrid drives
Hans-Jörg Beeck
Werdohl, Germany
“ All set for the hybrid trend. ”
The trend is to electric and hybrid
technology, and it‘s the automotive manufacturers that are coming up with clever
innovations. The new 8-speed automatic
transmission that ZF Friedrichshafen AG
developed from the drawing board with
GF Automotive was designed right from
the start so that it can initially be combined with a combustion engine but can
later be built into hybrid cars too. That‘s
why it includes an electric engine rather
than a torque converter. The engine
housing delivered by GF Automotive is
“made to measure”. What‘s more, to obtain higher performance, oil ducts that
are cast in the gearbox supply defined
shift elements, while the hydraulic impulse oil storage reduces fuel consumption for the start/stop function. “The conventional, cost-intensive drilling of the
ducts is a thing of the past,” explains
Hans-Jörg Beeck, Key Account Manager
at GF Automotive for the ZF Group.
The environmental impact of the
start/stop automatic function is huge. The
8-speed automatic transmission requires
eleven percent less fuel than the previously most efficient 6-speed transmission. The fuel consumption of this socalled mild hybrid is 26 percent lower; the
saving rises to 49 percent in the full
hybrid model. Says Hans-Jörg Beeck:
“With engineering solutions like these,
GF Automotive is all set for the hybrid
trend even today.”
Georg Fischer 25
India builds nation-wide gas network
Shekhar Jagtap
Ratnagiri, India
“ Local players are more successful in India. ”
Gas consumption in India is soaring as urbanisation spreads and the
demand for energy grows. Huge infrastructure projects are underway, and
GF Piping Systems is benefiting with its
new products.
The BRIC countries – Brazil, Russia,
India and China – have certainly come
out on top in the last decade. Like China,
Lights on for finer cutting
Volker Reichmann
India has an exceptionally good record.
The economic crisis hardly touched India, which even at the low point of the
recession was reporting growth of over
four percent.
Shekhar Jagtap, Head of GF Piping
Systems in India, provides an explanation
for the country‘s astounding resilience:
“India has a huge backlog of infrastructure needs and domestic demand; that‘s
what keeps the economy booming.” The
government is investing massively in
modernising the country; infrastructure
spending between 2007 and 2015 is
expected to come to 500 billion US
dollars. Jagtap says: “In order to finance
this growth, the authorities are cooperating with the private sector in publicprivate partnership projects.”
The energy giant Reliance Industries, for instance, is constructing a gigantic pipeline network. According to the
Managing Director “More than 200 cities
will be connected in the medium term.”
The fast-growing agglomerations desperately need gas either for power generation or for domestic use. So it comes
as no surprise that even now “around
one million households are connected up
to the gas grid every year.”
To keep pace with this tremendous
growth, since 2009 GF Piping Systems
has been supplying grid operators
throughout the country with welded
fittings for gas distribution from a new
plant in the port town of Ratnagiri.
Shekhar Jagtap is certain that the investment in the new production site will pay
off fast since “local players are more
successful in India.”
Solingen, Germany
“ Access to completely new segments. ”
Laser technology is a particularly
promising and future-oriented addition
to the GF AgieCharmilles product range.
Early-adopter customers, such as surface treatment specialists J. & F. Krüth
in Solingen, are already putting the
technology through its paces. CEO Stefan
Krüth recognized the potential of laser
as soon as he heard that it could be used
for ablation. “Laser ablation creates
possibilities that up to now designers
could only dream about,” explains Krüth.
Volker Reichmann, Marketing Coordinator
at GF AgieCharmilles, agrees: “Laser
technology opens up completely new
segments for us.”
In October the Corporate Group
launched a five-axis laser ablation machine. Stefan Krüth was one of the first to
purchase the equipment and is placing
great hopes in it: “We are now in a position to transfer absolutely identically
sized and reproducible 3D structures onto the surfaces of injection moulds.” The
automobile industry is particularly interested in the technology: “We‘ve already
designed steering wheels, body trim
and glove compartments for high-profile
carmakers, and all the feedback has
been positive,” reports Krüth. He can
also envisage other uses for the technology: “From spectacle cases to designer
furniture – the laser will soon be leaving
its mark everywhere.”
26 Georg Fischer
CORPORATE ORGANIZATION AND STRUCTURE
Corporate organization and structure
Georg Fischer Ltd, the holding company of the Georg
Fischer Corporation, is organized under Swiss law, headquartered in Schaffhausen (Switzerland) and listed on the SIX
Swiss Exchange.
Board of Directors. The ten members of the Board of
Directors, elected individually by the Annual General Meeting,
are responsible for determining the Corporation’s strategic
direction, the design of accounting, the financial controlling and
financial planning. It appoints the Executive Committee and has
ultimate responsibility for supervising and monitoring the management of Georg Fischer Ltd.
Executive Committee. The President and Chief Executive
Officer is responsible for the management of the Corporation
and is assisted in this task by the other members of the Executive Committee. The Executive Committee addresses all issues
of relevance to the Corporation.
Structure. Georg Fischer Corporation is organized in three
operational groups and two corporate staffs. Operational
groups are GF Piping Systems, GF Automotive and GF AgieCharmilles. Corporate staffs are Finance & Controlling and Corporate Development. The heads of the Corporate Group and the
Corporate Staff units are responsible for managing their businesses and for achieving their business objectives.
Corporate Management. The CEO, the CFO and the Delegate of the CEO for Corporate Projects form Corporate Management in the narrower sense. Corporate Management is closely involved in management, planning, communications,
finance, management development and corporate culture and
is supported in these tasks by a team of about 50 people.
Corporate Governance. Detailed information about the
Corporate Governance of Georg Fischer see page 45 to 54.
Executive Committee of Georg Fischer (left to right):
Jürg Krebser, Pietro Lori, Yves Serra (President and CEO), Roland Abt, Michael Hauser, Josef Edbauer.
Georg Fischer 27
As of January 1, 2010
EXECUTIVE COMMITTEE
6 members
GF Piping Systems
Head: Pietro Lori
Finance & IT &
Strategic Planning
Mads Joergensen
Human Resources
Alain Ritter
CEO:
Yves Serra
GF Automotive
Head: Josef Edbauer
GF AgieCharmilles
Head: Michael Hauser
Operations
Stefan Gautschi
Finance & Controlling
Andreas Müller
Sand Casting
Dirk Lindemann
Finance & Controlling
Mauro Fontana
Technology &
Innovation
Nabil El Barbari
Human Resources
Josef Hary
Pressure Die Casting/
Permanent Mould
Casting
Ulrich Forrer
Human Resources
Joachim Heidrich
Europe & KAM
Jens Frisenborg
America
Christof Blumer
Purchasing
Atul Malhotra
Marketing & Sales
Arne Allée
Global Marketing &
Customer Services
Jean-Pierre Wilmes
Research &
Development
Beat Ruckstuhl
Milling
Bernhard Iseli
Asia
Tony Steels
Corporate
Development
Head: Yves Serra
Delegate of the CEO
for Corporate Projects
Jürg Krebser
Corporate Controlling
& Investor Relations
Daniel Bösiger
Risk, Tax &
IP Services
Daniel Vaterlaus
Corporate
Communication
Bettina Schmidt
Corporate Human
Resources
Stephan Wittmann
Corporate Treasury
Andreas Häggi
Law & Compliance
Richard Furrer
Secretariat General
Roland Gröbli
Corporate Planning
Helmut Elben
Internal Auditing
Peter Gyger
EDM
Ivan Filisetti
Europe and Americas
Jean-Pierre Wilmes
Asia
Herbert Zengerling
Finance &
Controlling
Head: Roland Abt
New Technologies &
Automation
Jean-José Paccaud
28 Georg Fischer
GF PIPING SYSTEMS
“ We bring you clean water. ”
Serving our customers. The transport of water, gas and
corrosive media requires particularly safe and leak-free piping
systems that assure effective environmental protection and the
careful use of resources. GF Piping Systems engineers, produces and distributes worldwide a broad range of piping systems
in different materials for the safe transport of water, gas and
aggressive media. The product offering includes pipes, fittings,
manual and actuated valves, sensors and instrumentation,
using plastic and complementary materials such as malleable
cast iron and brass. The wide range of jointing technologies
such as welding, electrofusion, solvent cementing, compression or push-fit enable its customers to assemble the components efficiently and to avoid possible leaks.
Thanks to its comprehensive know-how and years of experience in materials and jointing technology, GF Piping Systems
is the technology leader in problem solving packages for water
treatment, water mains and water distribution. This ensures
that the system solutions for these applications are second to
none: all piping components are available from a single source
and are compatible with each other.
Customer support in more than 100 countries is backed up
by efficient, round-the-clock service. Development and production facilities in Europe, Asia and the USA are located close to
customers and meet all local requirements. Certification of the
product range to international and local standards is a matter of
course at GF Piping Systems.
Markets. GF Piping Systems is the world leader in PE fittings and jointing technology for water and gas utilities; it is also
the world leader in industrial plastic applications and in selected markets of building technology.
GF Piping Systems has developed a strong presence not
only in Europe, its home market, but also in Asia, the Americas
and the emerging markets, especially in Central and Eastern
Europe, Russia and the Gulf Region. Despite the 2009 economic
downturn, the market potential and future outlook of these
countries remains positive.
GF Piping Systems is aiming at a geographically balanced
portfolio and is forging ahead in its drive to open up new
markets. The new production facilities in India and Malaysia are
part of this strategic thrust. They secure worldwide market
leadership for GF Piping Systems in the gas and water utilities
segment as well as in building technology.
Trends and strategy. The careful management of basic
resources such as water and energy is growing in importance,
as is the fight against environmental pollution, contamination
and leakage. Major investments have been planned by governments all over the world to overhaul their water pipe networks
and to promote programmes to save energy or develop alternative sources.
The world faces major challenges in the field of energy.
The rapidly rising consumption of energy, the finite nature of
fossil fuels, increasing prices and climate change are only some
Georg Fischer 29
Key markets of GF Piping Systems:
Gas and water utilities, industry, building
technology and the chemical industry
Completely relaxed the young
couple enjoys a perfect night at the
swimming pool. Life can be so easy.
More and more people all over the world
fulfil their dream of having more comfort, at home or in any resort worldwide.
Satisfying moments like these are
possible partly thanks to Georg Fischer:
GF Piping Systems is a specialist, among
other things, for absolutely leak-proof
and resource-saving joints connecting
water pipes.
Thousands of metres of pipes, fittings, valves of every kind and sensors
are needed in a wellness resort so that
everyone feels comfortable.
GF Piping Systems has more than
40,000 products in its range for a wide
variety of applications and special areas.
They are employed in water treatment,
water distribution and the transport of
liquids and gases.
At GF Piping Systems, all products
come from a single source and are
matched with each other. That is why
GF Piping System is a preferred supplier
for many large infrastructure projects
like hotels, apartments and offices,
creating security and comfort for
mankind the world over.
Butterfly valve
4 300
over
employees worldwide
40 000
over
products in the range
of the topics that business, society and politics need to contend
with. As a leading supplier of plastic piping systems, GF Piping
Systems supports research and development of the energyefficient use of raw materials and resources. Our innovative
solutions help reduce energy consumption, shape the future
and sustainably protect the environment.
Water treatment and water recycling plants are the key to
ensuring adequate water supply. Sea-water desalination is increasingly important for overcoming the problems of drought
and water scarcity that affect many countries. At the same time,
as wealth in Asia and the emerging markets grows, demand for
more comfort at home is spreading fast.
Global customers demand globally available, integrated
system solutions from a single source in order to avoid compatibility risks. The strategy of GF Piping Systems is to satisfy
these needs. It systematically gears its products to serve specific
applications and market segments. The four most important
customer segments are gas and water utilities, building services, water treatment and the chemical industry.
The acquisition of JRG Gunzenhauser AG in Switzerland
significantly strengthened the Corporate Group’s market position
in building services. Pooling the two product portfolios, which
make an excellent fit, has greatly expanded the combined
offering.
GF Piping Systems is well positioned to take advantage of the global
trends in the water market, energy
sector and environmental issues.
Actions to improve profitability. Developing sales in noncyclical businesses, the emerging markets and Asia is having a
positive and stabilising effect on profitability. GF Piping Systems
is systematically expanding its network of sales offices and production units. Sales per customer are being increased by focusing on market segments and harnessing the Corporate Group‘s
worldwide support network.
Profitability is being achieved by continuous productivity
gains in production processes, logistics and procurement.
Standardisation of supply chain management at the global level
is delivering excellent results, as regards both procurement
and enterprise resource planning systems. The expansion of
decentralised warehouse capacity is being consistently pursued
outside Europe too.
GF Piping Systems ensures its worldwide leadership by
offering a complete package. Long life, resistance to corrosion,
ease of installation and leak-tight connections are fundamental
customer requirements. Plastic piping systems are increasingly becoming the first choice since they are simple to install,
flexible, have a considerable weight advantage and are highly
resistant to acids and other chemical compounds.
30 Georg Fischer
GF AUTOMOTIVE
“ We make your ride smooth and safe. ”
Serving our customers. Working in close cooperation with
customers, GF Automotive develops components for the automotive and commercial vehicle industry. Almost all the major
automotive manufacturers source highly stressed castings in
aluminium, magnesium or iron from GF Automotive. Each component is the result of cooperative dialogue between the customers and our specialists in research and development, casting,
processing and assembly. Our foundries are pioneers in the use
of new processes for quality assurance and environmental
protection.
The Corporate Group manufactures components at
10 locations in Germany, Austria and China with a total weight
of 325,000 tonnes. Manufacturers all over the world value the
innovativeness of Georg Fischer incorporated in the materials
and production processes and the development and manufacturing know-how that goes into the product solutions.
The research and development competencies of GF Automotive are concentrated in Munich (Germany), Schaffhausen
(Switzerland) and Suzhou (China). Essential development
aspects include component design, computer-assisted calculations, and simulations as well as analyses to ensure costeffective manufacturing. About three percent of sales are
ploughed back into research and development every year.
Markets. GF Automotive is the European technology and
market leader with proven competencies in all casting processes relevant for serial production (sand casting, pressure die
casting and gravity die casting) and for processing the
associated materials iron (spheroidal graphite), aluminium and
magnesium.
GF Automotive develops and manufactures mainly components for automotive drive systems, chassis and bodywork. It
delivers unfinished, partly finished or ready-to-assemble parts,
in line with customer needs. At the top of the customer list are
German passenger and heavy-goods vehicle manufacturers
who export their products all over the world.
GF Automotive is also present in China, now the largest
market for passenger cars and light trucks. In 2005, the
Corporate Group opened a new light-metal foundry in Suzhou,
and in May 2009 production began at its new iron foundry in
Kunshan. In addition to Western companies and joint ventures,
the cus-tomer base of the Suzhou and Kunshan plants increasingly includes Chinese automotive manufacturers, who in
cooperation with Georg Fischer are producing high-quality
vehicles for the domestic market and for export.
Trends and strategy. Passenger and heavy-goods vehicles
remain the preferred means of transport. The long-term trend
is to build lighter, cheaper and environmentally-friendlier cars.
A parallel trend is to develop vehicles offering greater safety,
comfort and performance, coupled with a smaller environmental footprint.
Engineers are working flat out to develop alternatives to
conventional combustion engines. In the near term, the focus is
on hybrid engines, but further out cars powered by electric motors will increasingly compete with gasoline-powered vehicles.
Georg Fischer 31
A young woman in China fills up
her car‘s gas tank. A scene that is taken
for granted today, but was unthinkable
only a few years ago. And in future?
Georg Fischer is working to ensure that
the now global demand of people for
individual mobility can certainly be fulfilled. GF Automotive is an important
development partner and manufacturer
of highly stressable cast parts for the
automotive industry.
In order to increase resource efficiency, GF Automotive is continuously
improving its materials, processes and
products. The materials developed and
patented by GF make it possible to build
light and yet more efficient vehicles and
thus to save fuel.
Almost every major car manufacturer is a customer of GF Automotive.
With its two foundries in China, GF is
also participating in the growth in what
is now the world‘s largest automotive
market. GF Automotive is involved in
developing the cars of tomorrow, including vehicles with pure electric drives.
Will this picture soon look different in
one important detail?
Key markets of GF Automotive:
Passenger and commercial
vehicle industry
Gear housing
5 400
over
employees worldwide
GF Automotive is cooperating closely with customers in developing the cars of tomorrow, including vehicles running purely on
electric motors.
GF Automotive has for years geared research and development to lowering CO2 emissions and reducing vehicle weight to
maximise fuel efficiency. It will therefore emerge strengthened
from the present downturn. GF Automotive is an industry leader
in the design of light-weight components, the use of bionics
and the integration of composite casting technology. With
SiMo 1000® and SiboDur®, GF Automotive has developed two
very robust and heat-resistant cast iron alloys.
The trend to platform-sharing concepts is paving the way
for global production networks continues to increase. These
trends go hand in hand with the manufacturers‘ focus on development, assembly, brand management and marketing. As it
GF Automotive is closely involved
in developing the cars of tomorrow,
including vehicles running purely
on electric motors.
expands vertical integration and deepens its competency in
processing complex parts, GF Automotive is taking advantage
of the scope for increasing added value. It is constantly expanding its customer base, especially in Asia. Iron, aluminium and
80 mill.
approx.
parts produced in 2009
magnesium components are consolidating their strong foothold
in vehicle construction.
In 2009, China for the first time became the largest market
for passenger vehicles and is said to expand this position. China
will therefore be increasingly important as a production location. GF Automotive will be able to participate in this growth
owing to its two Chinese foundries: one in Suzhou (pressure die
casting), which is being expanded for the third time, and the
other in Kunshan (iron casting).
Actions to improve profitability. GF Automotive was hit
very hard in 2009 by the massive slump in sales in the motor
vehicle industry. It sold its foundry in Gleisdorf, Austria, and
closed down its plant in Montreal, Canada, while stepping up
operational measures to boost productivity at all its sites. There
will be no let-up in these efforts. GF Automotive is entering 2010
with production capacity that has been fully optimised.
As a specialist for automated metal casting in serial production, GF Automotive also manufactures escalator steps,
gear housings for wind turbines, components for construction
machinery and other castings. GF Automotive will continue to
expand this non-automotive business.
GF Automotive is well positioned in Europe and China to
capitalise on the opportunities in the passenger and truck markets. The current recession is a challenge from which GF Automotive will emerge stronger, leaner and tougher.
32 Georg Fischer
GF AGIECHARMILLES
“ We shape your daily life. ”
Serving our customers. The customers of GF AgieCharmilles are small and medium-sized machine-tool makers as
well as global corporations. Their success depends on the precision and efficiency with which they can manufacture their products. Owing to superior precision, speed and reliability, the
machines from GF AgieCharmilles yield higher productivity at
lower operating costs over their entire life, generating greater
value for customers.
Electric discharge machining (EDM) and high-speed milling (HSM) are key technologies used in the manufacture of
practically all modern consumer durables. And the new laser
technology launched in 2009 offers economic, environmental
and design advantages. This technology, furthermore, opens up
a whole new range of possible applications in the design area.
Our customers benefit from our highly qualified and
trained employees the world over. The Corporate Group‘s
research and development centres and production sites are
located in Meyrin, Nidau and Losone (Switzerland), in Vällingby
(Sweden) and in Beijing and Changzhou (China).
Markets. GF AgieCharmilles is the world’s leading
supplier of machines, automation solutions and services to
the tool- and mould-making industry as well as to manufacturers of precision parts and components. GF AgieCharmilles
is the global no. 1 in the areas of EDM and automation for
the tool-making industry and a leader in the field of highspeed milling.
The Corporate Group has a strong market position especially in Europe and the United States but is also an important
player in Asia, particularly in China, India, Japan, Korea, Singapore and Taiwan, where it has its own distribution and sales offices. In Brazil, too, the most important market in Latin America,
GF AgieCharmilles is the market leader.
A globally active company with its own organizational
structure, GF AgieCharmilles is present at about 50 locations worldwide. It covers the rest of the world‘s markets
with a fine-meshed network of distribution offices and sales
representatives.
Trends and strategy. Mass consumer goods are now
manufactured primarily in Asia, more specifically in China,
which has itself become a growing market for mass-produced
articles. Working closely together with its R&D departments in
Europe and China, GF AgieCharmilles has developed machines
for these markets. There is, in addition, growth potential particularly in Eastern Europe, India, Malaysia, Vietnam and Brazil
as well as in Mexico, which is increasingly important for the
US market as an alternative location to China for production.
GF AgieCharmilles is well represented in these countries and
can take full advantage of this potential.
In Northern and Central Europe, customers are concentrating more and more on high-tech components, for instance
precision parts or small components made of high-grade
materials for applications in medical technology, the energy
sector, aerospace or microtechnology. The trend to miniaturisation is also opening up new business opportunities.
GF AgieCharmilles has an unrivalled production programme for
these demanding customers.
Georg Fischer 33
The young girl is enjoying her book.
LED lighting like this is still an exception,
but the experts are forecasting that it will
catch up with the best traditional bulbs in
terms of light quality in the current year
– 2010. In terms of energy efficiency, it is
already as much as eight times better.
Partly because of Georg Fischer.
The electronics of LEDs are minuscule and have to be manufactured in
high-precision moulds. An international
team of specialists at GF AgieCharmilles
responded rapidly to this challenge.
As a leading manufacturer of machine
tools featuring electric discharge machining and high-speed milling, the Corporate Group has the necessary competencies to provide the right solutions for this
demanding task.
Especially in Taiwan, the largest
producer of LEDs, leading manufacturers rely on these two core technologies of GF AgieCharmilles in the manufacture of the necessary components.
GF AgieCharmilles is going all out to
ensure that this young girl can continue
to read by the light of LED lamps thanks
to GF AgieCharmilles.
Key markets of GF AgieCharmilles:
Tool and mould-making industry, consumer industry
Electric discharge machine
2 500
over
employees worldwide
There is no let-up in price pressure in the tool- and
mould-making industry, and this competition on price is driving
demand for integrated and inexpensive automation solutions. The Corporate Group depends on the experience and
know-how of the world‘s market leader, System 3R, part of the
Georg Fischer Corporation, to offer its customers impressive
automation solutions.
In manufacturing, machines operate round the clock
nowadays, enabling customers to cut operating costs and
increase productivity. These are weighty arguments in the
unrelenting price battle. The GF AgieCharmilles Customer
Services unit meets this need, ensuring high-quality and rapid
service and professional application know-how.
In 2010 GF AgieCharmilles is
offering new products and
applications for all growth
markets and customer segments.
Actions to improve profitability. GF AgieCharmilles responded swiftly to the massive slump in 2009, reducing the
number of its production sites for machines in Switzerland from
four to two, rationalising organizational complexity and streamlining its distribution network. The Corporate Group will approach 2010 with a much leaner and more agile structure that
can react flexibly to changing market needs.
48 000
approx.
machines installed worldwide
Despite cost savings, major milestones in product development were achieved in 2009. New products are being offered
for all growth markets and customer segments. In addition,
GF AgieCharmilles developed a new technology in 2009 and has
already put a range of six inexpensive laser machines on the
market. This new technology fits in with the existing portfolio
and is being marketed to the same customer segments through
the existing sales channels. GF AgieCharmilles has thus
once again proven that it is an innovation driver in the machine
tool industry.
With its excellent position in its core markets, GF AgieCharmilles is confident that the measures it has taken will enable it
to maintain its market leadership. The Corporate Group has
every intention – and the know-how too – to remain the technology leader in EDM and HSM.
Thanks to its outstanding overall range, in particular its
tooling and process support and its high-performance electronics, it is the preferred partner in the tool- and mould-making
industry and in high-quality precision manufacturing. Its service
and customer support are second to none in the industry. The
Corporate Group is unlocking new applications in all technologies and taking full advantage of the opportunities.
Clean Water supports the construction of water tanks
WATER SUPPLY MEANS
NEW OPPORTUNITIES
Water tanks
Doña Selfida
El Ojochal del Listón, Nicaragua
“ The new rainwater
tanks are wonderful.
We always have running
water in the house.
We‘re very grateful
for that. ”
In Nicaragua, the Georg Fischer Clean Water Foundation
is supporting the Nuevas Esperanzas development project.
The project‘s goal is to collect valuable rain water and promote sustainable agriculture.
The lava in the crater of the Telica volcano makes an impressive sight, but the farmers from the nearby mountain village El Ojochal del Listón have no time for sight-seeing. Their
life in northwestern Nicaragua has always been harsh. “We
used to have to ride an hour and a half at dawn with two horses
to fetch water.” 57-year-old Selfida Ballasteros Zapata recounts. “Sometimes the horses lost their footing on the slippery
paths and fell.” Then the well dried up, and she had to ride yet
another hour to the next town to get water. Afterwards, she walked home with the two fully laden pack animals. One reason
that the region suffers from a lack of water is that it rains seldom, but then it pours. In the past, the farmers collected the
water in small containers, but there was never enough. The
development organization Nuevas Esperanzas and the Clean
Water Foundation have changed that.
“On 21 December last year, we had an unusually heavy
downpour,” recalls Andrew Longley, a British hydrogeologist
who is in charge of the Nuevas Esperanzas aid project. “That
meant that in December alone we were able to collect 2,300
litres of rainwater for each family.” A valuable reserve since the
water will probably have to last until May. The supply is now
kept in large new community water tanks. With support from
Clean Water, five large rainwater tanks, each with a capacity of
40,000 litres, were built in the region in 2009. In addition, five
large families each received one such tank, and eleven families
each a smaller 20,000 litre tank.
Until now, the people in the region have tried to get by on
only 13 litres of water a day for each person. Visibly pleased,
Longley says: “Now it‘s twice as much.” Yet this is only a tenth
of the average American‘s private daily water consumption.
About 1,000 farmers use the collected water mainly for drinking, eating and washing. But the water tanks also create new
opportunities. A third of the water is now distributed by a drip
irrigation system and employed to grow vegetables.
“Initially, people were dubious,” Longley recalls. “They
couldn‘t imagine that the thin-walled reinforced concrete tanks
could withstand the large quantities of water.” In gruelling conditions, the 13 employees of Nuevas Esperanzas and many volunteers hauled the building materials up to the remote villages
with an all-terrain vehicle, a tractor and oxen carts. “It was
great to see how the project brought the communities the one
thing they needed most,” says civil engineer Arturo Juárez, recalling with pleasure the difficult task.
But the environmental sins of the past – committed out of
poverty and ignorance – are still visited on the present generations. “Deforestation and non-sustainable farming methods
have caused environmental damage and soil erosion, which
result in meagre harvests,” Longley explains. Reforestation is
being actively promoted, and the farmers are being shown
methods of sustainable farming. The latest project is beekeeping, practised without setting fire to the trees in which the
wild bees live. For the local farmers, the project is more than an
improvement in living conditions. When asked about the
changes that the water tanks have meant, they stress how the
project has fostered a sense of community and how their selfrespect has grown as a result of their hands-on involvement in
the construction work.
36 Georg Fischer
SUSTAINABILITY
Sustainability
This Report summarises the principles of Georg Fischer
on sustainable business practices and shows how the Corporation is implementing them. Georg Fischer publishes a complete
account with up-to-date figures in a separate Sustainability Report every two years, the next one being in summer 2010. In addition, the information on the subject of sustainability is updated
regularly on the Georg Fischer website www.georgfischer.com.
Commitment and responsibility. Georg Fischer regards
its industrial and social commitment as a long-term undertaking. The Corporation‘s goal is to be a preferred partner for
all stakeholders and to excel for its responsible, sustainabilitydriven conduct and for continuity. “Quality of life from Georg Fischer” means that people in all corners of the world can expect
Georg Fischer to make an important contribution to their
present and future needs.
Transparency and openness. In 1992 Georg Fischer
signed the Charter of the International Chamber of Commerce
(ICC) for sustainable development with due regard to economic,
ecological and social aspects. The Corporation thus “officially”
committed itself to sustainable conduct.
Georg Fischer has been recording and evaluating environmental indicators since 1997. Since 2005, it has also been collecting social key figures through its substantially expanded
Sustainability Information System (SIS). The environmental data
are supplied by all production companies and large sales companies, while the social data are obtained from all Georg Fischer companies with more than ten employees.
Georg Fischer published its Sustainability Report as a separate publication for the first time in 2006. Reporting is based
on the guidelines of the Global Reporting Initiative (GRI) and is
validated by the Swiss Association for Quality and Management
Systems (SQS).
In the reporting year, the Northwestern Switzerland University of Applied Sciences selected the Georg Fischer Annual
Report as the best in Switzerland. In the analysis, special emphasis was placed on the transparency of reporting on economic, ecological and social figures. All told, more than 250 annual reports of leading Swiss companies were evaluated. Georg
Fischer likewise won first place for its internet site in the joint
annual report rating of the business magazine Bilanz and the
Harbour Club, the professional association of heads of corporate communications in Switzerland.
Adding Quality to People‘s Lives. With this brand promise,
GF contributes to sustainable improvement in the quality of
people‘s lives. Mobility, comfort and precision are the key market needs that Georg Fischer satisfies with its products and services. The objective of GF is to create value for all stakeholders
in its global environment through profitable organic growth and
targeted acquisitions. Georg Fischer endeavours to strike a balance between ecological, economic and social concerns.
The huge slump in demand and the related drop in sales
confronted Georg Fischer with very special challenges in 2009.
Nevertheless, the Corporation did not relax its efforts to contribute actively with its products and services to solutions for climate change, greater energy efficiency and the improved supply of
clean drinking water. Concern about environmental protection
forms an integral part of Georg Fischer‘s corporate culture. The
protection and conservation of natural resources has long
played an important role. This applies both to manufacturing
processes and to the development of new products.
People
Structural measures. In May 2009, Georg Fischer announced a far-reaching structural programme in response to the
massive slump in sales. This involved reducing the number of
employees by about 2,300 people by mid-2010 through the disposal of companies, natural fluctuation, early retirement arrangements and dismissals. By the end of 2009, the number of employees had fallen by 1,800 persons net. Honouring its corporate
culture and policy statements, Georg Fischer did everything
within its power to avoid giving employees notice. In order to
decrease personnel capacity, therefore, Georg Fischer first
used up overtime, reduced flexitime balances and introduced a
hiring freeze. Contracts about to expire with temporary and
staffing agencies were not extended. Short-time work was introduced in many plants in order to forestall dismissals. The
number of people on short-time work peaked at over 4,000 by
mid-2009 and had fallen to below 1,500 by the end of the year.
Wherever dismissals were unavoidable to adjust personnel
capacity to the drop in demand, vacancies in other parts of the
company were offered or employees were given advice and active assistance in finding a new job.
Almost 300 senior managers declared that as of May 2009
they would waive 10 percent of their monthly salary and the CEO
20 percent. The Board of Directors also participated in this saving
drive and waived 20 percent of its cash remuneration for 2009.
Georg Fischer 37
Net added value. Public perception focuses first and foremost on the profit generated by a company. However, of greater
significance for society and the economy is the net added value
created by the company, i.e. the added value that remains
after deduction of all external costs. In 2009, Georg Fischer
generated net added value of CHF 692 billion. Of this total, over
120 percent was disbursed to employees as wages and salaries.
Distribution of net value added 2009 (in %)
(100 % = CHF 692 million)
–40%
0%
40%
80%
12 0 %
Employees
Public authorities
Lenders
Shareholders
Safety at work and health protection. In all production and
logistics corporate subsidiaries, occupational safety and health
protection are integrated into the management system and certified to OHSAS 18001. OHSAS 18001 is compatible with ISO
9001 and ISO 14001, which are now standard practice in the
Georg Fischer manufacturing facilities. By the end of the year
under review, 38 percent of the certifiable firms had been
certified. The aim is for all these companies to have introduced
OHSAS 18001 by end-2011. Companies that are newly founded
or acquired are to be certified within three years at most.
An additional goal defined by the Executive Committee was
to reduce the accident rate in all Corporate Groups by at least
5 percent in both 2008 and 2009, compared with the average for
the previous three years. Precise figures for the 2009 Sustainability Report will be available in summer 2010.
Pandemic. As instructed by the Executive Committee, a
crisis team headed by the Chief Risk Officer was established.
The team drafted a global preparedness plan, on the basis of
which each corporate subsidiary or each location drew up a
pandemic preparedness plan adapted to local requirements. By
means of this plan, Georg Fischer both ensured that its business would continue to run in orderly fashion (business continuity planning) and addressed its duty of care towards its employees. The H1N1 pandemic was fortunately less severe than
had been feared. No major loss of working days or serious illnesses due to the pandemic were reported at Georg Fischer.
Management training. Having already proven its worth
over many years, the Management Development process
helped the Corporation to fill around 80 percent of all senior
management vacancies with candidates from its own ranks in
2009. Despite the far-reaching cost cuts, the courses important
for the ongoing training of managers – Financial Management
Training (FMT) und Corporate Management Training (CMT) –
were each held once. Over 50 managers representing 20
different nationalities from all parts of the Corporation again
participated in several days of intensive training in the
Corporation
Corporation’s own training centre, Klostergut Paradies. In
addition to the technical and management training courses, the
three Corporate Groups also offer training programmes geared
to operations.
Sharing best practices. The Corporation’s senior managers address issues of strategic and operational significance
both at an annual two-day conference and at the regional meetings of the Managing Directors, which are chaired by the President and Chief Executive Officer. In 2009, 30 Managing Directors
participated in the meetings for Germany and Austria in Schorndorf, Germany, and for China in Shanghai. In addition to strategy
and financial management, the topics under discussion
addressed human resources management.
Training at all levels. In 2009, Georg Fischer offered 487
training positions, about 200 of them in Switzerland, for training
in various technical or commercial professions. Georg Fischer
has a long tradition of apprentice training and will continue to
make every effort to maintain the high percentage of trainees in
the workforce and to offer attractive training positions for basic
vocational training. In the restructuring, all existing apprenticeship contracts were exempt from the job cutback measures.
After the Schaffhausen plant of Mikron Agie Charmilles AG was
closed, the apprentices there were able to continue their apprenticeship in another Georg Fischer factory.
Georg Fischer is making great efforts in providing support
to apprentices. For instance, Georg Fischer in Singen, Germany,
once again held its “Open Door Day” where school-leavers,
parents and teachers had the chance to visit the plant and find
out in person about the mainly technical training opportunities.
For its exemplary efforts in apprenticeship training, Georg Fischer Traisen, Austria, is now permitted to call itself a “nationally recognized training enterprise”.
38 Georg Fischer
SUSTAINABILITY
Environment
Employees 2009 by region (in %)
(100 % = 12 481)
America
7%
Germany
Asia / Australia
18 %
Rest of Europe
7%
Austria
30%
Switzerland
21%
17 %
Information. The employee newspaper GLOBE, which appears regularly in five languages, keeps all employees up-todate about issues relevant to sustainability. In addition, Managing
Directors and specialists have been regularly receiving a sustainability newsletter, which informs them about current events
and sustainability trends in society and the world of science.
Deeply rooted in society. Georg Fischer fosters active
cooperation with local communities and the authorities. It supports employees who work for the good of their communities. In
accordance with its fundamental values and corporate principles, GF undertakes to promote cultural, social and environmental involvement and contribute to the common good. The
holding company and corporate subsidiaries are involved in
many local projects at their respective locations. In 2009, the
Corporation donated around CHF 1.5 million for such projects,
and in addition some 30 corporate subsidiaries made in some
cases substantial contributions to local activities.
The Corporation maintains and funds a number of charitable foundations, including the Iron Library Foundation, the
largest private library in the world devoted to the production and
use of iron.
Clean Water. With its Clean Water Foundation, Georg Fischer
has been involved since 2002 in projects to improve water supply
in developing countries and disaster areas. Since then, GF has
donated over CHF 5 million to the Foundation and has thus funded the implementation of more than 70 projects in 40 countries
on four continents. In the year under review, seven projects were
completed. Five new projects – in Indonesia, Brazil, Tajikistan,
southern Sudan and Bangladesh – received around CHF 350,000
in financing. In all projects, the aim is for experienced partners
to support the local population in its efforts to sustainably improve its supply of drinking water. GF continues to donate a substantial sum to the Foundation every year.
Environmental footprint. About 80 percent of the
Corporation‘s environmental footprint is incurred by the energy-intensive production in GF Automotive‘s foundries. In the reporting year, the economic trend led to a reduction in the
amount of external energy needed, although the plants did not
achieve any further improvement in efficiency. This also applies
to the foundries‘ blast furnaces, which have to be heated even
when running at low capacity. Precise figures for the 2009 Sustainability Report will be available in summer 2010.
Energy. The challenges of the future include climate
change, the finite nature of fossil fuels and the marked increase
in the demand for energy. In 2008, Georg Fischer caused nearly
700,000 tonnes of CO2 emissions, of which 310,000 tonnes were
due to fossil fuels, 370,000 tonnes to electric power and about
10,000 tonnes to business travel by car and plane.
All three Corporate Groups of Georg Fischer contribute,
through their products and solutions, to increasing energy
efficiency and lowering energy consumption. See pages 28 to 33
as well.
Clean Water
Clean Water projects 2002–2009 (total = 75 projects)
0
5
10
15
20
25
Asia
Africa
Latin America
Europe
Clean Water projects
Energy performance. With its directive on Energy-Using
Products (EUP), the European Union has launched a farreaching process designed to improve the energy performance
of electric devices and machines. As a purchaser and user of
energy-driven products and as a manufacturer of machine
tools, Georg Fischer is affected by this programme. In industrial
production, electric motors account for 70 percent of power
consumption on average. More than 95 percent of the life cycle
costs of a motor are energy costs. GF AgieCharmilles takes
these facts into account and is constantly improving the energy
efficiency of its generators. When new machines are purchased,
Georg Fischer 39
the life cycle costs are taken into account in the cost analysis
preceding the purchase decision.
Helping prevent global warming. Georg Fischer is committed to energy-saving measures in production. In January
2009, the project launched by Georg Fischer Singen in Germany
and the Nestlé corporation to use waste heat officially started
operation. The blast furnaces of the GF foundry now supply the
adjacent Maggi factory with waste heat, thereby reducing annual CO2 emissions by over 11,000 tonnes.
“Reducing emissions that cause pollution is one of the primary environmental goals of our times. Despite the financial
and economic crisis, companies must not neglect their ecological responsibility,” stressed Chairman of the Board Martin Huber at the official inauguration of the plant. Sigmar Gabriel, who
was then Germany‘s Minister for the Environment, came from
Berlin for the ceremony and emphasised the exemplary nature
of this neighbourhood project.
Plastic is “greener”. Another example of environmentally
friendly products is the plastic pipes in the applications and
dimensions supplied by GF Piping Systems. As a study commissioned by GF shows, they almost invariably outperform competitor materials. To give an example: the CO2 footprint – in other
words the total greenhouse gas emissions produced by manufacture, transport and disposal – of one metre of PE piping with
a nominal pipe size of DN 80 is about five times smaller than
that of a stainless steel pipe.
Supplier Code. The social and environmental responsibility of a company increasingly also extends to the choice of business partners. The Georg Fischer Supplier Code came into effect in January 2009. The Code defines the requirements for all
Georg Fischer suppliers with respect to sustainable business
practices. The principles embodied in the Code are based on
international agreements and standards.
The key points of the Code are ethical conduct, respect for
human rights, socially responsible working conditions, compliance with environmental standards and certified management systems. The Code is available in eight languages. All key
suppliers have been requested to sign the Code, and with a few
exceptions all of them did. The Code stipulates that, all other
things being equal, Georg Fischer will give preference to those
suppliers who have signed on.
Dialogue. For many customers of Georg Fischer, for
instance in the construction or automotive industries, sustainability and the efficient use of resources have become an important issue. The technology and price must be right, but so must
the sustainability performance. For example, only suppliers
who have passed the “sustainability test” qualify for construction projects for the 2012 Olympic Village in London. GF Piping
Systems has qualified!
The German carmaker Daimler asks its suppliers to adhere to its Sustainability Guideline and gives the topic a prominent place in the procurement process. As one of only two suppliers, GF Automotive was invited to the 2nd “Daimler Sustainability Dialogue” on 5 November 2009, where over a hundred
stakeholders from business, politics and social organizations
discussed the issue of sustainability and exchanged ideas.
Know-how transfer. In developing new products and solutions and improving on existing ones, GF works across national
borders with other companies, universities and renowned research institutes. Cooperation with research and scientific institutes enables GF to tap into a wealth of ideas and unleashes
creative potential in the Corporation’s own ranks. GF Automotive, for instance, works closely together with the Technical Universities in Aachen, Vienna, Clausthal and Leoben and with the
Konstanz University of Applied Sciences. GF Piping Systems cooperates with the Technical University in Aachen in the field of
plastics and with EMPA, the Swiss materials science and technology research institute in Zurich. GF AgieCharmilles cooperates with the Federal Institutes of Technology in Zurich and
Lausanne and with the Catholic University in Louvain, Belgium,
among others.
Life cycle assessment. Sustainable solutions require that
a product’s entire life cycle be taken into account. For a number
of years, therefore, life cycle assessment (LCA) has been gaining in importance at Georg Fischer. With the help of this approach, the impact of new products on the environment is ascertained by assessing the raw materials and suppliers selected, production, customers’ use of the products along with reuse of the products once their life cycle has expired.
GF Automotive uses only unmixed scrap, some of it from
car manufacturers, as a raw material to produce its iron materials. For the production of aluminium and magnesium alloys, it
employs clean pig iron (cast bars). It uses recycled materials to
meet around 50 percent of its raw material requirements. More
than 85 percent of the waste produced when smelting raw
40 Georg Fischer
SUSTAINABILITY
materials and casting is recycled for use in other areas of industry. The iron, aluminium and magnesium castings are 100 percent recyclable.
GF Piping Systems carries out life cycle assessments on
selected products. In the period under review, the Corporate
Group concentrated on implementing the new EU requirements
in the area of hazardous substances (ROHS and REACH).
GF AgieCharmilles provides its customers with an extensive service offering which ensures that the installed base of
machines always meets the current technical standards and
has a long service life. Energy consumption is a major concern
in development work.
Impact on the overall result. The impact of these environmental efforts on the overall result is not explicitly quantified.
Georg Fischer does not doubt that they have a positive impact,
despite the substantial investment often required. Lower costs
for waste disposal and the reduced consumption of water, for
example, both have a positive effect. Thanks to heat recovery
systems and energy-saving processes, the demand for external
energy is falling. High safety and environmental standards
make it possible to obtain lower insurance premiums and reduce environmental risks. Georg Fischer is also convinced of
the unquantifiable, but nevertheless high value of its reputation
as an environmentally responsible business enterprise.
42
Share price 2005–2009
43
Five-year overview Corporation
44
Corporate Governancee
45
Compensation Report
55
Consolidated financial
statements
57–94
Statement of financial position
58
Income statement, statement of comprehensive income
59
Statement of changes in equity
60
Statement of cash flows
61
Notes to the consolidated financial statements
Segment information
62
Corporate accounting principles
66
Notes
71
Report of the Statutory Auditor
94
Financial statements
Georg Fischer Ltd
95–104
Statement of financial position
96
Income statement, statement of changes in equity
97
Notes to the financial statements
98
Proposal by the Board of Directors for the
This financial report is a translation
appropriation of retained earnings 2009
103
from the original German version.
Report of the Statutory Auditor
104
In case of inconsistencies the German
version prevails.
Affiliated companies
105–109
Consolidated financial statements
Share information
Financial statements Georg Fischer Ltd
42–56
Affiliated companies
Investor information
Investor information
Financial Report 2009
42 Georg Fischer
INVESTOR INFORMATION
Share information
Share capital
2005
2006
2007
2008
2009
Number of shares as per 31 December
Registered shares
3 500 638
4 100 898
4 100 898
4 100 898
4100 898
Dividend-entitled thereof
Registered shares
3 450 638
4 050 898
4 050 898
4 050 898
4 100 898
12 226
10 848
12 308
15 347
15 410
453
290
449
790
446
790
1 040
653
697
697
183
240
300
110
262
10
13
12
17
n/a
1 549
42
141
3 198
79
232
2 823
63
189
972
22
72
1 073
37
97
Cash flow from operating activities in CHF
per registered share
88
85
106
49
60
Earnings / (loss) in CHF
per registered share
46
62
58
14
–61
326
372
372
337
273
Dividend paid (proposed) in million CHF 1
52
101
101
20
0
Dividend paid (proposed) in CHF
per registered share 1
15
25
25
5
0
Pay-out ratio in %
33
40
43
36
n/a
Conditional capital
Registered shares
648 847
Number of registered shareholders
Share prices adjusted in CHF
Registered share
highest
lowest
closing as per 31 December
Price-earnings ratio
Market capitalization as per 31 December
million CHF
in % of sales
in % of equity attributable to shareholders of Georg Fischer Ltd
Equity attributable to shareholders of Georg Fischer Ltd in CHF
per registered share
Tickersymbols
Telekurs, Dow Jones (DJT): FI-N
Reuters: FGEZn
Security number: 175 230
ISIN: CH000175 230 9
Cedel / Euroclear Common Code: XS008592691
1 From 2005 to 2008 in form of a reduction in par value.
Georg Fischer 43
Share price 2005 – 2009
CHF
1 050
1 000
Investor information
950
900
850
800
750
700
650
600
550
Consolidated financial statements
500
450
400
350
300
250
200
150
100
50
Dec. 2007
Dec. 2008
Dec. 2009
GF closing (CHF)
SPI closing – rebased
Market capitalization, earnings / (loss) per share
The market capitalization stood at CHF 1,073 million
on 31 December 2009. Loss per share is at CHF 61
(previous year: earnings CHF 14).
Significant shareholders
According to a statement of BDS Beteiligungsgesellschaft
AG, Buchberg, solely owned by Prof. Dr. Giorgio Behr, it
held 6.36 % of the voting rights as per 27 November 2008
in Georg Fischer Ltd. The package consists of 211,000
shares, equivalent to 5.15 % of share capital, and 50,000
options, equivalent to 1.21 % of share capital.
According to an announcement of UBS Fund Management
(Switzerland) AG, it held 3.09 % of the share capital of
Georg Fischer Ltd as per 26 June 2009.
Credit Suisse Assets Management Funds AG announced
that it held 3.64 % of the share capital of Georg Fischer Ltd
as per 1 July 2009. On 27 October 2009 it reported that its
share of the share capital had fallen below the 3 % threshold again.
Categories of shareholders as per 31 December 2009
Number of shares
1–100
101–1 000
1 001–10 000
10 001–100 000
100 000
Shares not registered in share register
Total
Number of shareholders
12 936
2 258
187
26
3
Number of shares %
10.6
15.1
13.8
16.2
10.1
15 410
34.2
100.0
Financial statements Georg Fischer Ltd
Dec. 2006
Affiliated companies
Dec. 2005
Dec. 2004
44 Georg Fischer
INVESTOR INFORMATION
Five-year overview Corporation
million CHF
2005
2006
2007
2008
2009
Order intake
Orders on hand at year-end1
3 783
947
4 245
1 094
4 635
1 186
4 462
560
2 906
475
3 692
403
252
4 048
474
327
4 497
484
326
252
175
327
249
326
245
4 465
400
227
–10
–83
134
69
2 906
106
–58
–90
–53
–201
–238
298
146
5
–128
–5
184
317
143
4
–138
14
298
426
151
7
–217
–1
243
197
159
14
–243
–159
–197
242
152
12
–148
–10
94
1 390
1 684
3 074
1 202
995
158
877
1 656
606
1 363
1 845
3 208
1 448
827
1 440
1 953
3 393
1 540
748
1 543
1 748
3 291
1 404
621
1 447
1 419
2 866
1 152
750
933
1 712
324
1 105
1 769
264
1 266
1 906
546
964
1 575
472
45
55
42
58
42
58
47
53
50
50
39
32
29
45
26
29
45
24
31
43
19
38
40
26
34
16
15
6.8
2.3
8
19
19
8.1
2.4
8
16
19
7.2
2.6
10
5
12
5.1
2.5
4
–19
–3
–2.0
1.7
8
12 403
7 782
4 427
2 326
2 565
2 558
602
1 454
12 385
7 413
3 995
2 397
2 646
2 630
652
1 674
12 986
7 511
4 056
2 393
2 723
2 705
652
2 100
14 326
7 829
4 047
2 664
3 064
3 046
1 161
2 272
12 481
6 816
3 796
2 164
2 570
2 560
897
2 198
Income statement
Sales
EBITDA2
EBIT before special charges2
Restructuring expenses2
Impairment on goodwill and property, plant and equipment2
EBIT
Net profit / (loss) for the year
Cash flow
Cash flow from operating activities
Depreciation2
Amortization2
Additions to property, plant and equipment
Cash flow from acquisitions and divestitures
Free cash flow
Statement of financial position
Non-current assets
Current assets
Assets
Equity
Non-current liabilities
thereof subordinated convertible bond
Current liabilities
Net operating assets (NOA)
Net debt
Asset structure
Non-current assets %
Current assets %
Capital structure
Equity %
Non-current liabilities %
Current liabilities %
Key figures
Return on equity (ROE) %
Return on net operating assets (RONOA) %3
Return on sales (EBIT margin) %4
Asset turnover
Cash flow from operating activities in % of sales
Employees
Employees at year-end
European Union
thereof Germany
thereof Austria
Other European countries
thereof Switzerland
America
Asia, Australia
1
2
3
4
In 2008 change of definition for GF Automotive.
The previously reported figures were reclassified to conform with the current year‘s presentation.
Calculated on EBIT before special charges / NOA adjusted by impairment on goodwill.
Before special charges.
CORPORATE GOVERNANCE
Georg Fischer 45
Corporate Governance
As of 1 January 2010
Affiliated companies. An overview of all affiliated companies can be found in the financial section on pages 106 to 109.
Significant shareholders. Three disclosure notifications
were published in 2009. According to an announcement by UBS
Fund Management (Switzerland) AG, it held 3.09 percent of the
share capital of Georg Fischer Ltd as per 26 June 2009.
Credit Suisse Asset Management Funds AG announced that
it held 3.64 percent of the share capital as per 1 July 2009. On 27
October 2009 it reported that its share of the share capital had
fallen below the 3 percent threshold again.
Board of Directors
10 members
Chairman: Martin Huber
Investor information
The organizational structure of the Corporation is illustrated
in the diagram on this page. The Corporation has three operational
Corporate Groups: GF Piping Systems, GF Automotive und
GF AgieCharmilles, plus the Corporate Staff units Finance & Controlling and Corporate Development. As of 1 January 2010, the
CEO will also be the Head of Corporate Development. The parent
company of all the corporate subsidiaries is Georg Fischer Ltd. It
is incorporated under Swiss law and is domiciled in Schaffhausen.
Georg Fischer Ltd is listed on the SIX Swiss Exchange (FI-N, security number 175 230). Its share capital is CHF 82 017 960 (previous year: CHF 102 522 450), and its market capitalisation was
CHF 1 073 million (previous year: CHF 972 million) as at
31 December 2009.
Consolidated financial statements
Contents. The present publication fulfils all obligations of
the corresponding SIX Swiss Exchange directive on information
relating to Corporate Governance in terms of content and order.
The Compensation Report is presented in a separate chapter on
pages 55 to 56.
All figures apply to 31 December 2009, unless otherwise
noted. Any changes occurring before the copy deadline on 19 February 2010, are listed at the end of this section. Any changes
occurring after the copy deadline can be found on our website.
Georg Fischer also publishes the Articles of Association of Georg
Fischer Ltd, the internal Organization and Business Regulations,
its mission statements and much more information online at
www.georgfischer.com/corporate_governance_en
Corporate Structure and Shareholders
Financial statements Georg Fischer Ltd
The Board of Directors and Executive Committee of Georg
Fischer attach considerable importance to corporate governance
in the interests of shareholders, customers, business partners
and employees. The implementation and ongoing improvement of
the generally accepted principles of corporate governance ensure management that is transparent and commensurate with
risk. This report provides information on structures and processes, areas of responsibility and decision-making paths, control
mechanisms as well as the rights and obligations of the various
stakeholders.
GF Piping Systems
Pietro Lori
GF Automotive
Josef Edbauer
GF AgieCharmilles
Michael Hauser
Finance & Controlling
Roland Abt
Delegate of the CEO
for Corporate Projects
Jürg Krebser
Corporate Development
Yves Serra
Affiliated companies
Executive
Committee
Verwaltungsrat
6 members
10
Mitglieder
CEO: Yves
Serra
Präsident:
Martin
Huber
46 Georg Fischer
CORPORATE GOVERNANCE
One disclosure notification was published in 2008. According to an announcement of BDS Beteiligungsgesellschaft AG,
completely controlled by Prof. Dr. Giorgio Behr, it held 6.36
percent of voting rights in Georg Fischer Ltd as per 27 November
2008. The package consisted of 211,000 shares, equivalent to 5.15
percent of share capital, and 50,000 options, equivalent to 1.21
percent of share capital.
www.six-swiss-exchange.com
Significant shareholder group. As at end-2009, Prof. Giorgio Behr and BDS Beteiligungsgesellschaft AG were entered in the
share register with 4.7 percent of the share capital with voting
rights. Another 0.3 percent of the share capital was held by natural
persons and legal entities, which the Board of Directors, in compliance with its obligations under the Articles of Association,
pursuant to § 4.9, para. a (clause on voting right restriction) counted as part of this group. In the Schaffhausen Cantonal Court, Prof.
Giorgio Behr and BDS Beteiligungsgesellschaft AG challenged the
Board of Directors‘ view that a group had been formed. At yearend, the lawsuit of BDS Beteiligungsgesellschaft AG regarding the
0.3 percent of shares entered in the share register without voting
rights was still pending. (See ‚Changes after the balance sheet
date‘, page 54).
Cross-shareholdings. There are no cross-shareholdings or
shareholder pooling agreements with other companies.
Capital Structure
Capital and share information. Fully paid-in share capital
amounts to CHF 82,017,960 (previous year: CHF 102,522,450). It is
divided into registered shares with a par value of CHF 20 (previous
year: CHF 25). Each share has one vote at the General Meeting of
Shareholders. Further information concerning the share capital
and changes in capital for the past five years can be found in the
financial section on pages 42 to 43. No participation or profit sharing certificates exist.
Restrictions on transferability. Registration in the company’s share register as a shareholder with voting rights or beneficiary with voting rights is subject to the approval of the Board of
Directors. Approval of registration is subject to the following rules:
A natural person or legal entity may directly or indirectly accumulate no more than 5 percent of registered share capital. Persons
who are bound by capital or voting rights, by consolidated management or in another similar manner, or who have come to an
Board of Directors
Martin Huber
Chairman of the Board, 1941 (Switzerland)
Dipl.-Ing. ETH (Zurich), lic. iur. University of Zurich
Bruno Hug
Vice Chairman of the Board, 1941 (Switzerland)
Lic. oec. HSG, lic. iur. University of Geneva
Board member since 1992;
Chairman of the Board since 2003
2012
Board member since 1992;
Vice Chairman of the Board since 2004
2010
Professional background, career
Assistant at ETH’s Institute of Telecommunications
(1966–1967); clerk at the cantonal court of
Schaffhausen (1970–1972); various positions at
Mettler Instrumente AG (1972–1981), appointed to
the Executive Board in 1976; various positions for
the Georg Fischer Corporation in Switzerland and the
USA (1981–2003), including Head of Georg Fischer
Piping Systems (1984–1992), President and CEO and
Delegate to the Board (1992–2003).
Various positions at the Union Bank of Switzerland
(now UBS) in New York, Basel, Geneva and Zurich
(1971–1998), ultimately as Executive Vice President
and as a member of the Expanded Executive Board;
Chairman of the Senate of the University of Fribourg
(1999–2005); Chairman Banque Ferrier Lullin & Cie
SA (1999–2004); Deputy Chairman of the CSS Insurance Group (1996–2008); business lawyer in Geneva
(since 1998).
Further professional activities
and functions
Member of the Board of Directors of economiesuisse
Vice Chairman of Schenk Group Rolle/VD; member
of the Boards of Directors of Chopard S.A., H&M
Hennes & Mauritz, Karl Steiner AG and SogelymDixence S.A.S. Lyon.
Chairman of the Compensation and
Nomination Committees
Member of the Nomination Commitee
Independent member
Independent member
Name
Position, year of birth, nationality
Educational background
First term as Board member
Termination of current term
Committees
Corporate Governance
Georg Fischer 47
As of January 1, 2010
Convertible bonds and options. There are no outstanding
convertible bonds and no options issued by Georg Fischer.
Compensation Committee
Investor information
Rudolf Huber, Chairman
Gerold Bührer
Ulrich Graf
Kurt E. Stirnemann
Martin Huber, Chairman
Flavio Cotti
Ulrich Graf
Nomination Committee
Martin Huber, Chairman
Roman Boutellier
Gertrud Höhler
Bruno Hug
Roman Boutellier
Member of the Board of Directors, 1950 (Switzerland)
Dr. sc. math. ETH (Zurich)
Gerold Bührer
Member of the Board of Directors, 1948 (Switzerland)
Lic. oec. publ. University of Zurich
Flavio Cotti
Member of the Board of Directors, 1939 (Switzerland)
Lic. iur. University of Fribourg (Switzerland)
Board member since 1999
Board member since 2001
Board member since 2000
2013
2011
2010
Kern AG (1981–1987);
member of the executive management of Leica AG
(1987–1993); Professor of Business Management
at the University of St. Gallen (1993–1998);
CEO and Delegate to the Board of Directors of
SIG Holding AG (1999–2004); Professor of Innovation
and Technology Management at the ETH in Zurich
(since 2004) and Vice President Human Resources
and Infrastructure ETH Zurich (since 2008).
Various positions at the Union Bank of Switzerland
(now UBS) (1973–1990), ultimately as a member of
the executive management of the bank’s investment
company; member of the Executive Committee of
Georg Fischer Ltd (1991–2000); member of the
Swiss Parliament (1991–2007), business consultant
(since 2000).
Lawyer and notary in Locarno (1965–1975);
member of the cantonal government in Ticino
(1975–1983) and of the Swiss Parliament
(1983–1986); Federal Councillor (1987–1999),
President of the Swiss Confederation (1991, 1998).
Board member of Ammann Group Holding AG;
member of the bank council of the Cantonal Bank
of Appenzell; member of the board of trustees of
Vontobel Foundation.
President of economiesuisse, member of the
Bank Council of the Swiss National Bank, Vice
Chairman of the Board of Directors of Swiss Life,
member of the Boards of Bank Sal. Oppenheim
(Switzerland), Cellere AG and Züblin Immobilien
Holding AG.
Member of the Board of Directors of Società
Elettrica Sopracenerina SA; member of the board
of trustees of Jacobs Foundation.
Member of the Nomination Committee
Member of the Audit Committee
Member of the Compensation Committee
Independent member
Independent member
Independent member
Consolidated financial statements
Cancellation or amendment of restrictions. Cancellation or
easing of the restrictions on the transferability of registered
shares requires a resolution of the General Meeting of Shareholders passed by at least two-thirds of the shares represented and
an absolute majority of the par value of the shares represented.
Audit Committee
Financial statements Georg Fischer Ltd
Nominee registrations. Persons who hold shares for third
parties (referred to as nominees) are only entered in the share
register with voting rights if the nominee declares his willingness
to disclose the names, addresses and shareholdings of those
persons on whose behalf he holds the shares. The same registration limitations apply mutatis mutandis to nominees as to individual shareholders. Applications for registration that exceed the
threshold of five percent are refused. No such applications were
received during the year under review.
BOARD COMMITTEES
Affiliated companies
agreement for the purpose of circumventing this rule, shall be
deemed as one person. Applications for registration that exceed
the threshold of five percent are refused.
48 Georg Fischer
CORPORATE GOVERNANCE
Board of Directors
Responsibilities. The Board of Directors has ultimate responsibility for supervising and monitoring the management of
Georg Fischer Ltd. The Board of Directors is responsible for all
matters vested in it by the law (Art. 698 Swiss Code of Obligations)
or the Articles of Association. These are in particular:
– decisions on corporate strategy and the organizational
structure,
– appointing and dismissing members of the Executive
Committee
– organizing finance and accounting,
– determining the annual and investment budgets
The Board of Directors delegates operational management
to the Chief Executive Officer, who is assisted in this task by the
Executive Committee. The competencies and the cooperation between the Board of Directors and the Executive Committee are
defined by the Organisation and Business Regulations.
www.georgfischer.com/corporate_governance_en
Independence. All members of the Board of Directors are
non-executive. There are no significant business relationships
between the members of the Board or the companies or organizations they represent and Georg Fischer AG or a subsidiary company.
Election and term of office. Members of the Board of Directors are elected individually by the Annual General Meeting and
normally for a term of four years. Each year the General Meeting
of Shareholders will elect or re-elect around a quarter of the
Board members. Particular emphasis is placed on entrepreneurial experience, relevant expertise or international ties when selecting Board members. The Board of Directors aims for a proper
balance of competence and knowledge, taking into account the
main operational focus of the Corporation, its international orientation and the accounting requirements of companies listed on the
stock exchange.
The term of office of newly elected members is determined at
the time of election, with consideration given to the staggered renewal of the Board. Members whose terms expire may be reelected
immediately. Members of the Board must resign their mandate at
the Annual General Meeting following their 70th birthday.
Board of Directors
Name
Position, year of birth, nationality
Educational background
First term as Board member
Termination of current term
Professional background, career
Further professional activities
and functions
Committees
Corporate Governance
Ulrich Graf
Member of the Board of Directors, 1945 (Switzerland)
Dipl. El.-Ing. ETH (Zurich)
Gertrud Höhler
Member of the Board of Directors, 1941 (Germany)
Dr. phil. University of Mannheim (Germany)
Board member since 1998
2010
Board member since 1999
2011
Various positions at the Kaba Group (1976–2006),
ultimately as President and CEO and Delegate to
the Board of Kaba Holding AG (1990–2006).
Professor of Literature and German at the University
of Paderborn, Germany (1976–1995); personal
assistant to the Chairman of the Board of Deutsche
Bank (1987–1990), economic and political consultant
and author of authoritative books on corporate
development and management (since 1978).
Chairman of the Board of Directors of Kaba
Holding AG, Dätwyler AG, Griesser Holding AG and
of Fr. Sauter AG; member of the Board of Directors
of Feller AG, member of the supervisory board of
Dekra e.V. and member of the board of trustees
of REGA.
Member of the Board of Directors of Bâloise
Holding AG.
Member of the Audit and
Compensation Committees
Member of the Nomination Committee
Independent member
Independent member
Rudolf Huber
Member of the Board of Directors, 1955 (CH)
Dr. oec. publ. University of Zurich
Kurt E. Stirnemann
Member of the Board, 1943 (Switzerland)
Dr. sc. techn. ETH (Zurich)
Zhiqiang Zhang
Member of the Board of Directors, 1961 (China)
Bachelor of Sciences from Northern Jiatong
University, Beijing (China); MBA from Queen’s
University, Kingston (Canada)
Board member since 2006
2012
Board member since 2003
2011
Board member since 2005
2013
Various positions in the financial sector of industrial
firms in Switzerland (1985–1992); CFO of Geberit AG
(1992–2004); business consultant (since 2005);
part-time lecturer at the Hochschule für
Wirtschaft in Lucerne and lecturer at the University
of St. Gallen.
Assistant (1969–1971) and lecturer (1973–1977)
at the ETH in Zurich; various positions at Rieter
(1977–1990), ultimately as Managing Director of
Maschinenfabrik Rieter AG and as deputy member
of the Executive Committee of Rieter Holding AG;
President and CEO of Agie AG (1990–1996); member
of the Executive Committee of Georg Fischer as
well as CEO and Delegate to the Board of Directors
of the Agie Charmilles Group (1996–2003);
President and CEO of Georg Fischer Ltd and
Delegate to the Board (2003–2008).
Various positions at Siemens in a number of countries, including the USA, Germany and China (1987–
2006), CEO of Nokia Siemens Networks, Greater
China Region (since 2007).
Chairman of the Board of Directors of Looser Holding AG, member of the Board of Directors of Swiss
Prime Site AG and Jelmoli Hold-ing AG and of the
non-listed companies Hoerbiger Holding AG, Wicor
Holding AG and Zur Rose AG; President of the CFO
Forum Switzerland.
Member of the Board of Directors of Feintool AG
–
Chairman of the Audit Committee
Member of the Audit Committee
–
Independent member
Non-executive member
Independent member
Consolidated financial statements
Areas of responsibility. The members of the three standing
Board Committees are listed on page 47. The Board Committees
provide preliminary advice to the Board of Directors and do not
make any definitive decisions (except the Compensation Commit-
Work methods of the Board of Directors. Decisions are
made by the Board of Directors as a body. Members of the Executive Committee also participate in Board meetings for agenda
items relating to the company’s business. They are not entitled to
vote, however. Only the Chief Executive Officer is present when
personnel topics are dealt with. Invitations to Board meetings list
all of the issues that the Board of Directors, a Board Committee
or the CEO wish to discuss. All participants in a Board meeting
receive written material on the proposals in advance.
The Board of Directors meets at least four times a year
under the leadership of its Chairman. During the year under review, it met seven times: the annual strategy meeting lasted two
days, four meetings lasted half a day, and two lasted less. The
Financial statements Georg Fischer Ltd
Internal organizational structure. The Board of Directors
constitutes itself by electing a Chairman and a Vice Chairman
from among its members on an annual basis. Members of the
committees are elected in the same manner. The Board of Directors constituted itself the day of the Annual General Meeting,
18 March 2009, as follows: Martin Huber Chairman (hitherto) and
Bruno Hug Vice Chairman (hitherto).
tee). They discuss the issues assigned to them and make proposals to the Board of Directors as a whole. The President and
CEO attends the meetings of the Board Committees, but is not
entitled to vote. Minutes of the committee meetings are sent to all
members of the Board of Directors. The chairmen of the individual committees also make a verbal report at the next meeting of the
Board of Directors and submit any proposals.
Affiliated companies
2009. At the 113th Annual General Meeting on March 18,
2009, Martin Huber, Roman Boutellier and Zhiqiang Zhang were
re-elected individually. Since Martin Huber will reach the statutory age limit at the 2012 Annual General Meeting, he was reelected for a term of only three years. Roman Boutellier and Zhiqiang
Zhang were re-elected for four years. The Board of Directors,
which in accordance with the Articles of Association consists of
seven to ten members, has ten members.
Investor information
Georg Fischer 49
50 Georg Fischer
CORPORATE GOVERNANCE
three standing Board Committees held a total of 14 meetings,
while two temporary Board Committees held four meetings. The
appointments for the regular meetings are generally set well in
advance in order that all members can attend personally. In 2009
the attendance rate was 100 percent.
External consultants are called on for their services involving specific topics. Further information is provided in the section
on the Board Committees.
Evaluation. The Board of Directors reviews its performance
and that of its members annually within the framework of a selfassessment. In the year under review, it assessed the work of the
Board of Directors, the procedure and quality of the meetings and
cooperation generally as well as succession planning for the
Board of Directors. The Board of Directors incorporates the conclusions of this assessment into its annual planning for 2010.
Audit Committee. The Audit Committee is comprised of four
Board members. The Audit Committee supports the Board of
Directors in monitoring the accounting and financial reporting,
supervises internal and external audits, assesses the efficiency of
the internal control system, including risk management, and the
compliance with statutory provisions, acknowledges the closing
financial statements, endorses the sensitivity analysis of the
pension trust funds of Georg Fischer Ltd and issues its opinions
on transactions concerning equity and liabilities at Georg Fischer
Ltd. The Audit Committee also decides whether or not the
consolidated financial statements and those of Georg Fischer Ltd
can be recommended to the Board of Directors for presentation to
the Annual General Meeting.
As a rule, the Chairman of the Board, the President and
CEO, the CFO, the chief internal auditor and a representative of the
external auditors also attend the meetings. At the request of the
Audit Committee and in agreement with the CEO, the external
auditor also provides information on current questions relating to
the financial statements and financial aspects. During the business year just ended, the Audit Committee held six meetings, two
of which lasted half a day, four less.
Executive Committee
Name
Position, year of birth, nationality
Educational background
Member of the Executive Committee
Professional background, career
Further professional activities
and functions
Yves Serra
President and CEO of Georg Fischer
Ltd, 1953 (France)
Roland Abt
CFO
1957 (Switzerland)
Josef Edbauer
Head of GF Automotive
1957 (Germany)
Engineering degree from Ecole Centrale
de Paris (France) and a M. Sc. in
construction engineering from the
University of Wisconsin-Madison (USA)
Dr. oec. HSG (St. Gallen)
Dipl.-Ing. (FH) University of Konstanz
(Germany)
Since 2003, CEO since 2008
Since 2004
Since 2008
Deputy commercial attaché at the
French Embassy in Manila (1977–
1979); customer service engineer for
Alstom in France and South Africa
(1979–1982); various positions at Sulzer in France and Japan (1982–1992);
various positions for the Georg Fischer
Corporation (since 1992), Managing
Director of Charmilles Technologies
Japan and Regional Head of Sales
Asia (1992–1996), Head of Charmilles
(1996–2003), Head of GF Piping Systems (2003–2008); President and CEO
of Georg Fischer Ltd (since 2008).
Head of Finance for a corporate
group in the areas of data processing
and real estate (1985–1987); various
positions at the Eternit Group (1987–
1996) in Switzerland and Venezuela,
ulti-mately as Division Manager of
their asbestos cement manufacturing
activities; various positions for the Georg Fischer Corporation (since 1996),
including CFO of the Agie Charmilles
Group (1997–2004) and CFO of the
Georg Fischer Corporation (since
2004).
Various positions at Georg Fischer
Automotive (since 1982), including
Head Engineering and Maintenance at
George Fischer (Lincoln) Ltd., Lincoln
UK (1985–1989), Managing Director
Georg Fischer Automobilguss GmbH,
Singen (Germany) (1999–2005); member of the Group Management and
Head Iron Casting Technology Unit at
GF Automotive (2005–2008); Head of
GF Automotive (since 2008).
Member of the Executive Committee
of swissmem
Member of the Regulatory Board and
Issuers Committee of the SIX Swiss
Exchange
–
Information and control instruments. The Board of Directors is kept informed continually and comprehensively about
business performance. The members of the Board also receive
the monthly report, which contains current information concer-
Michael Hauser
Head of GF AgieCharmilles
1961 (Germany)
Jürg Krebser
Delegate of the CEO for Corporate Projects
1948 (Switzerland)
Pietro Lori
Head of GF Piping Systems
1956 (Italy)
Studies of mechanical engineering and business
administration at Munich Technical University
(Germany) and University of Mannheim (Germany),
BA from the University of Mannheim (Germany).
Dr. sc. techn. ETH (Zurich)
Studies of mechanical engineering,
degree of Dr. Ing. Politecnico di Milano (Italy).
Since 2008
Since 1994
Since 2008
Various positions in different companies of the machine tool industry in Germany, Italy (1988–1996); Chairman of the Standard Milling Machines business unit
and member of Group Management of the Mikron
Technology Group (1996–2000); member of Group
Management of Agie Charmilles Holding Ltd (now:
GF AgieCharmilles) (since 2000), first as Head of the
Mikron division (2000–2004) and then as Head of the
Technology Unit Milling and of Marketing and Sales
Support (2004–2008); Head of GF AgieCharmilles
(since 2008).
Researcher on the scientific staff of the Institute of
Communication Technology at the ETH in Zurich
(1976–1980), various positions at BBC (today ABB)
(1980–1990), latterly as Head of Development in
a joint venture between BBC and Ascom; various
positions for the Georg Fischer Corporation in Switzerland and the USA (since 1990), including Head of
GF Piping Systems (1994–2003), CEO and Delegate
to the Board of Agie Charmilles Holding AG (today
GF AgieCharmilles) (2003–2008) and Delegate of the
CEO for Corporate Projects (since 2008).
Various positions in different companies
in Italy and United States (1982–1988) and GF Piping
Systems (since 1988), including Managing Director
of GF Piping Systems Italy (1994–1998), Head of
Southern Europe at GF Piping Systems, (1999–2001),
member of the Group Management of GF Piping
Systems (since 2002), latterly Vice President Division
Europe and Emerging Markets (2003–2008), Head of
GF Piping Systems (since 2008).
President of swissmem’s „Machine tool and manufacturing technology“ group and Chairman of
CECIMO, the European Committee for Cooperation
of the Machine Tool Industries.
Chairman of the Board of Directors of inspire AG.
–
Consolidated financial statements
Nomination Committee. The Nomination Committee is
comprised of four Board members. It supports the Board of Directors with succession planning for the Board itself and the Executive Committee and assists in the selection of candidates for ap-
Ad hoc Committees. In the course of the year under review,
the Board of Directors established two temporary ad hoc committees, each with three Board members. These committees studied
restructuring measures in depth and reviewed issues relating to
stock corporation law. The four meetings they held were attended
by members of Corporate management (CEO, CFO and Head Corporate Development) as well as the Head of the Corporate Group
directly affected, and internal and external specialists.
Financial statements Georg Fischer Ltd
pointment to the Board of Directors and the Executive Committee.
The Nomination Committee is informed annually about senior
management succession planning for the two highest operating
management levels. During the last financial year, the Nomination
Committee held four meetings, which lasted on average around
two hours.
Affiliated companies
Compensation Committee. The Compensation Committee
is comprised of three Board members. It supports the Board of
Directors in determining compensation policy for the highest corporate level and, on request, uses knowledge of external compensation specialists as regards market data from comparable industrial companies in Switzerland to this effect. In the 2009 business
year, no external consultants were hired to design compensation
and share option programs.
The Compensation Committee proposes to the Board of
Directors the total amount of compensation to be paid to the Executive Committee and the Chief Executive Officer and decides on
the remuneration of the other members of the Executive Committee upon a proposal of the Chief Executive Officer. The Compensation Committee held four meetings during the last financial
year, each of which lasted about an hour.
Investor information
Georg Fischer 51
52 Georg Fischer
CORPORATE GOVERNANCE
ning business performance and the accounts of the Corporation,
the Corporate Groups and subsidiaries together with a detailed
commentary. The Executive Committee presents and comments
on business performance and tables all important matters at the
Board meetings. It also presents its assessment of business performance for the coming three months.
The Board of Directors also receives projections of the annual financial statements twice a year, and the results of mediumterm planning for the next three years once a year. Once a year,
the Board of Directors has a two-day meeting behind closed doors
to concentrate exclusively on the strategies of the Corporate
Groups and the Corporation as a whole.
The Chairman of the Board of Directors attends the annual
conference of the Corporation’s top managers, the Executive
Committee’s two-day planning meeting and is a regular attendee
at other corporate management events. The Chairman of the
Board of Directors and the CEO inform and consult each other
regularly on all business matters that are of fundamental importance or have far-reaching ramifications. The Chairman of the
Board of Directors receives the invitations and minutes of the
meetings of the Executive Committee and Corporate management. He visits corporate subsidiaries on a regular basis to see for
himself their operations and how they are implementing the
Corporation’s strategies. In 2009 he visited Corporate Subsidiaries
in Europe, Asia and the USA.
Internal Audit. Internal Audit reports to the Chairman of the
Audit Committee and to the CFO functionally and administratively.
Based on the risk-oriented audit plan approved by the Audit Committee, corporate subsidiaries are audited either annually or every
two to three years, depending on the risk assessment. During the
year under review, 28 internal audits were conducted. The written
report is reviewed in depth with the management of the company
concerned; copies are given to the line managers, the external
auditor, the Executive Committee, and the Chairmen of the Board
and of the Audit Committee. Audit reports with significant findings
are presented to and discussed in the Audit Committee.
Internal Audit also ensures that all discrepancies arising
in internal and external audits are dealt with and submits a
corresponding report to the Executive Committee and the Audit
Committee. The head of Internal Audit prepares an annual
report, which is discussed by the Executive Committee and the
Audit Committee. He also serves as the secretary of the Audit
Committee.
Corporate Compliance. The Compliance Officer, who reports to the CEO, is responsible in particular for preventive
measures, training the Corporate Groups and providing information and consultation to the corporate subsidiaries to ensure that
the corporate subsidiaries comply with the law, internal rules and
the Corporation’s principles of business ethics in their business
activity.
The Executive Committee, in consultation with the Compliance Officer, defines the priority issues for the next two years.
In 2009, the Compliance Officer instructed some 200 employees
– especially managing directors and Marketing & Sales employees
– in five training modules on the avoidance of corrupt practices.
The Compliance Officer was, moreover, repeatedly consulted on
issues relating to exports controls, cartel law and labour law.
Risk Management. The Board of Directors and Executive
Committee attach considerable importance to a cautious approach to strategic, financial and operating risks and they therefore expanded corporate risk management during the past business year. The head of the Corporate Risk Management & Taxes
Service Division is the Chief Risk Officer (CRO). In this function, the
CRO reports directly to the President and CEO and is supported in
this task by Risk Officers from the three Corporate Groups. Together with specialists in Corporate Risk Management, they form
the Corporate Risk Council, which is headed by the CRO and which
met four times during the past business year.
The handling of financial risks is explained in the financial
section on pages 85 to 87 and of operational risk on page 21.
Assessment. The performance of the Executive Committee
and of its members is evaluated and assessed at least once a year
by the Board of Directors in the absence of the Executive Committee members. Members of the Executive Committee may not accept appointments to external Boards of Directors or take on
high-level political or military functions without the approval of the
Nomination Committee.
Executive Committee
The President of the Executive Committee and CEO is responsible for the direction of the Corporation. In this duty he is
supported by the other members of the Executive Committee.
Under the leadership of the CEO, the Executive Committee deals
with all Corporation-related issues, takes decisions within the
scope of its authority and submits proposals to the Board of Directors. The heads of the Corporate Groups and corporate units are
responsible for formulating and achieving their corporate goals
and for managing their areas autonomously. No management
responsibility is delegated to third parties at the Executive
Committee level (management contracts).
Members: As per 31 December 2009, Ernst Willi retired
from the firm, whereupon he ceased to be Head of Corporate
Development and a member of the Executive Committee. As per 1
January 2010, the Executive Committee has the following members: Yves Serra, CEO and Head of Corporate Development; Pietro
Lori, GF Piping Systems; Josef Edbauer, GF Automotive; Michael
Hauser, GF AgieCharmilles; Roland Abt, CFO; and Jürg Krebser,
Delegate of the CEO for Corporate Projects.
Georg Fischer 53
Proxy voting. A shareholder may, on the basis of a written
power of attorney, be represented at the General Meeting of
Shareholders by another shareholder entitled to vote, a member
of a governing body, the independent proxy, or a proxy holder of
deposited shares. Partnerships may be represented by a partner
or authorised signatory, legal entities by a person authorised by
law or the articles of association, married persons by their spouse,
wards by their legal guardians and minors by their legal representative, regardless of whether such representatives are shareholders or not.
Change of control and defence measures
The Articles of Association of Georg Fischer Ltd do not contain any regulation with regard to „opting-out“ or „opting-up“. For
one year subsequent to the effective date of a change of control,
the term of notice of termination agreed upon by contract is doubled for the members of the Executive Committee (from 12 to 24
months), as well as for several other members of senior management (from 6 to 12 months). Furthermore, a change of control will
result in the cancellation of all existing disposal limitations for
shares allocated according to the share plan.
In the event of a change of control, bondholders and banks
have the right to demand the immediate repayment of bond issues
and loans before they are due.
Auditors
Statutory quorum. The following resolutions of the General
Meeting of Shareholders require a majority greater than that laid
down by law. At least two-thirds of the shares represented and an
absolute majority of the par value of the shares represented must
be in favour of:
– the easing or revocation of restrictions on the transferability of shares,
– the introduction, expansion, easing or revocation of
restrictions on voting rights,
– the conversion of registered shares into bearer shares,
– the removal from office of a quarter or more of the
members of the Board of Directors,
– amendments to § 16.1 of the Articles of Association
concerning the election and term of office of members
of the Board of Directors,
– the removal of limitations in the Articles of Association
regarding the resolutions passed by the General Meeting
of Shareholders, in particular those contained in § 12.
Mandate. KPMG AG of Zurich became the external auditors
of Georg Fischer Ltd in 1985. The chief auditor, Philipp Hallauer,
has held that position since the 2003 Annual General Meeting. The
chief auditor is changed every seven years.
Audit fees. In 2009, the Corporation paid KPMG AG a total of
approximately CHF 2.28 million (previous year: CHF 2.12 million)
for services relating to the audit of the annual financial statements
of Georg Fischer Ltd, the Corporation as a whole and the corporate subsidiaries audited by KPMG worldwide. Globally, KPMG AG
received fees of approximately CHF 0.4 million (previous year: CHF
0.4 million), in particular for tax advice (CHF 0.3 million) and legal
advice.
Supervisory and control instruments. The Audit Committee
reviews and evaluates the effectiveness and independence of external auditors annually. The Audit Committee bases its evaluation
on the following criteria:
Investor information
Entries in the share register. The deadline for entering
shareholders in the share register with regard to attendance at
the General Meeting of Shareholders is around ten days before the
date of the General Meeting of Shareholders. It is stated in the
invitation.
Consolidated financial statements
Restriction on voting rights. The total number of votes exercised by one person for his own shares and shares for which he
votes by proxy may not exceed five percent of the votes of the
company’s total share capital. Persons or legal entities bound by
capital or voting rights or by joint management or otherwise or
acting in concert for the purpose of circumventing this provision
are regarded as one person. The Board of Directors may approve
exceptions to this rule.
The restriction of voting rights under § 4.10 of the Articles
of Association may be revoked only by a resolution of the General
Meeting of Shareholders, passed by a two-thirds majority of the
shares represented and an absolute majority of the par value of
the shares represented.
Agenda. Shareholders representing a minimum of 0.3 percent of the share capital may request that an item be added to the
agenda. The application must be submitted in writing no later than
60 days before the meeting and must specify the item to be
discussed and the shareholder’s proposal.
Financial statements Georg Fischer Ltd
As at 31 December 2009, Georg Fischer Ltd had 15,338 (previous year: 15,347) shareholders with voting rights, most of whom
reside in Switzerland. To maintain this broad base, the Articles of
Association provide for the statutory restrictions summarized
hereinafter.
Convocation of the General Meeting of Shareholders. No
regulations which deviate from those laid down by law exist.
Affiliated companies
Shareholders’ Rights
54 Georg Fischer
CORPORATE GOVERNANCE
–
–
–
quality of the documents and management letters,
time taken and costs,
quality of oral and written reports on individual aspects
and pertinent questions relating to accounting, auditing
or additional consulting mandates.
For the evaluation, the members of the Audit Committee use
first of all their knowledge and experience which they have acquired as a result of similar functions at other companies. Internal
Audit also issues an annual list of all services rendered by external
auditors for the Corporation and their costs. This report is
discussed in the Executive Committee and the Audit Committee.
Authorisation of the costs for the auditor of Georg Fischer Ltd and
the external auditing companies around the world is given by the
CFO or by the managing directors of the individual subsidiaries in
consultation with their line managers. A high level of cost transparency is ensured because Internal Audit prepares a report
every year. Any other mandates granted to KPMG AG are assessed
by the CFO.
In the presence of internal and external auditing, the Audit
Committee also evaluates potential for improvement regarding
collaboration, the processing of assignments and any interfaces
or overlapping of internal and external auditing. A representative
of the auditors attended the five regular meetings of the Audit
Committee.
The key facts and figures on Georg Fischer, digital media
kits on important events and the calendar of events of relevance
to shareholders, analysts and the media (Annual General
Meetings, press conferences, etc.) can be viewed and downloaded
from the Georg Fischer website.
Subscription to the e-mail service is free of charge. All media releases are available on the Georg Fischer website at the
same time as they are published. The online media release archive
dates back to 1996. In addition, shareholders of Georg Fischer AG
and all other interested persons receive the Annual Report and the
mid-year report directly in the post.
www.georgfischer.com/medien_en
www.georgfischer.com/628/663/285/8198.asp
www.georgfischer.com/628/652/2091.asp
Investor Relations
Daniel Bösiger
daniel.boesiger'georgfischer.com
Communications
Bettina Schmidt
bettina.schmidt'georgfischer.com
Changes after the balance sheet date
Information Policy
Georg Fischer has a policy of communicating proactively,
openly and promptly with all stakeholders. All communication
measures are based on a commitment to uphold the company’s
credibility. Whenever possible and permissible, employees are
notified first of issues that affect them. Open communication at all
levels is an important element of management responsibility. The
Corporate Communications and Investor Relations units are entrusted with the task of information and communication.
The Corporation‘s continually updated Internet site
www.georgfischer.com and media releases on important events
are a fixed feature of Georg Fischer communications. As a company listed on the SIX Swiss Exchange, Georg Fischer is subject to
the requirements on ad hoc publicity, i.e. the obligation to report
any events that may affect the share price. Georg Fischer also
maintains a dialogue with investors and media workers at special
events and road shows.
As at 4 February 2010, Prof. Giorgio Behr, Buchberg, and the
other shareholders belonging to the same group, BDS Beteiligungsgesellschaft AG, Buchberg, and the pension fund and welfare fund of Cellpack AG, Villmergen, are entered in the share
register with a total of five percent of the share capital of Georg
Fischer AG with voting rights. (See ‚Significant shareholder group‘,
page 46).
COMPENSATION REPORT
Georg Fischer 55
the financial section.
Compensation policy
Executive Committee
The Human Resources Policy lays down the principles of the
compensation policy. It is designed to provide simple and clearly
structured salary systems that ensure fair remuneration and are
transparent for the Corporation’s employees. Georg Fischer gears
salary levels to salaries in the relevant market and reviews these
levels at regular intervals. Individual compensation is determined
by the specifications of the position, competencies, performance
and the Corporation’s business success. Wherever possible,
Georg Fischer uses results- and performance-driven compensation
systems that include a results-related variable component. These
principles also apply to the compensation policy for the Board of
Directors and the Executive Committee, which are adopted by the
Board of Directors on a proposal of the Compensation Committee.
The amount and the elements of the compensation are
tailored to the respective sector and labour market and are reviewed regularly. Freely available information from companies of
similar size in the mechanical and electrical engineering industries in Switzerland as well as, if applicable, the findings from
surveys and studies by third parties are used for this purpose.
The performance-related bonus paid to members of the
Executive Committee is dependent on their reaching individual
performance objectives and on the business success of the Corporation. The share-related remuneration paid to the Executive
Committee members is a long-term incentive.
Board of Directors
The criteria for determining the remuneration of the Board
of Directors are the responsibility conferred on its members, the
complexity of their task, the specialist and personal requirements
made of them and the average time expected to be involved. The
details are set out in regulations which were amended in 2008.
The compensation consists of the following elements:
A) cash compensation
B) share-related compensation
C) other benefits
A) Each member of the Board of Directors receives a fixed
cash compensation as part of his or her basic remuneration.
Additional time for special tasks such as chairmanship, vicechairmanship or committee membership, for extraordinary meetings or for travel to and from meetings which does not take place
on the day of the meeting is also remunerated in cash. The cash
compensation may be paid out, wholly or in part, in Georg Fischer
shares. The shares can be vested for five years. The accountable
value of the shares is determined by the share price at the end of
the reporting year. This stood at CHF 261.75 on 31 December 2009.
The compensation consists of the following elements:
A) a fixed base salary in cash
B) a performance-related bonus in cash
C) share-related remuneration (long-term incentive)
D) contributions to pension and social insurance funds
A) The fixed base salary is determined primarily by the
manager’s task, responsibility, skills, managerial experience and
labour market conditions.
B) The performance-related bonus depends on the fulfilment of the individual performance objectives and the business
success of the Corporation.
As part of the management by objectives process, measurable individual targets are agreed at the beginning of the year
between the Chairman of the Board of Directors and the Chief
Executive Officer, and between the Chief Executive Officer and the
individual members of the Executive Committee. Fulfilment of
these targets is assessed at the end of the business year.
The business success of the Corporation as a whole and of
the individual Corporate Groups is measured by three financial
value drivers:
– organic sales growth
(excluding acquisitions and divestments),
– EBIT margin (ROS, EBIT / sales),
– asset turnover (sales / average net operating assets).
Consolidated financial statements
For the remunerations paid in the year under review, see pages 100 of
Financial statements Georg Fischer Ltd
B) Each member of the Board of Directors receives a fixed
number of Georg Fischer shares as part of his or her basic remuneration. It is possible to vest these shares for a period of five
years.
C) The other benefits include employee contributions to
social insurance funds and lumpsum remuneration for expenses
which are assumed by Georg Fischer Ltd.
Affiliated companies
Contents. The following information follows the guidelines
of the SIX Swiss Exchange on compensation policy and the remuneration paid to the Board of Directors and Executive Committee
and takes into account the transparency regulations of the Swiss
Code of Obligations Art. 663b and 663c CO.
The remunerations paid in accordance with the abovementioned provisions of the Swiss Code of Obligations are listed
and commented on in the consolidated financial statements
(pages 92 and 93) and in the statements of Georg Fischer Ltd
(pages 100 to 102).
Investor information
Compensation Report
56 Georg Fischer
COMPENSATION REPORT
The objectives are set by the Board of Directors for the medium term and are weighted in accordance with the strategic
priorities. A lower threshold and an upper ceiling are defined for
each of the three value drivers. If the lower threshold for the criterion in question is not reached, that part of the bonus will not
apply. Exceeding the ceiling, however, does not lead to a further
increase in the bonus.
The amount of the bonus is derived from fulfilment of the
targets. The maximum bonus for the members of the Executive
Committee may not exceed 90 percent of the base salary; for the
Chief Executive Officer the maximum is 110 percent.
The individual objectives and the business success are
weighted as follows: For the Corporate Group Heads, the weighting is one third each for the individual targets, the business success of the Corporate Group and that of the Corporation. For
heads of Corporate staff functions, the weighting is one third for
the individual targets and two thirds for the business success of
the Corporation. For the Chief Executive Officer, the business
success of the Corporation has a slightly higher weighting.
C) The share-related remuneration is a long-term incentive.
A fixed number of shares, vested for at least five years, are distributed to each member of the Executive Committee. The purpose of
this share allocation is to reward managers for the long-term
success of the Corporation over a period of at least five years. The
number of shares allocated is dependent on the function.
D) The pension and social insurance fund expenses include
employer contributions to social insurance funds and to obligatory and non-mandatory pension funds.
The expense regulations apply to members of the Executive
Committee in the same way as they do to all other employees
of the Georg Fischer corporate subsidiaries. Furthermore, an
additional regulation governing lump sum remuneration for minor
expenses and expenses incurred on behalf of the company applies
to members of the Executive Committee and all senior management employees in Switzerland. Both sets of regulations have
been approved by the relevant cantonal tax authorities. Members
of the Executive Committee do not have use of a company car.
For the remunerations paid in the year under review, see page 101 of the
financial section.
Other compensation payments
The Board of Directors and the Executive Committee of the
Georg Fischer Corporation do not receive any further compensation within the framework of these functions. None of the following
direct or indirect compensation payments apply.
Severance payments. There is no contractual entitlement to
severance payments by the members of the Board of Directors or
the Executive Committee. In the 2009 business year, no severance payments were made to persons who left governing bodies
in the year under review or earlier.
Options. Options are not allocated to members of the Executive Committee or the Board of Directors.
Additional fees. The members of the Executive Committee
and the Board of Directors or related parties did not receive
any fees or other remuneration for additional services to
Georg Fischer Ltd or one of its corporate subsidiaries in the 2009
business year.
Loans to members of governing bodies. Neither Georg Fischer Ltd nor its corporate subsidiaries granted any guarantees,
loans, advances or credit facilities to members of the Executive
Committee or the Board of Directors or related parties.
Decision-making authority and supervision
Board of Directors. Based on the compensation regulations, each member of the Board of Directors receives an annual
total compensation for expected time spent and the tasks assumed. The Compensation Committee may adjust the amount of
the total compensation should the actual time required deviate
significantly from the assumptions on which the payment is based.
Compensation is made on a pro rata basis for members joining or
leaving during the year he or she is in office. The compensation
due to members of the Board of Directors, in accordance with the
regulations, is proposed by the Chairman of the Board of Directors
to the Compensation Committee, which takes a decision at its
regular meeting in December.
Executive Committee. On the basis of the compensation
regulations, the Board of Directors decides, at its December meeting, based on a proposal by the Compensation Committee, on the
amount of the fixed remuneration to be paid for the following year
to the Chief Executive Officer and the entire Executive Committee.
The fixed compensation of the individual members of the Executive Committee is set by the Compensation Committee based on a
proposal by the Chief Executive Officer. At the February meeting
of the Compensation Committee and the Board of Directors, a
decision is taken, on the same basis, on whether the individual
objectives have been reached and on the resulting performancerelated bonus for the past business year.
Supervision. The internal auditors annually ensure compliance with the rules of compensation for the Executive Committee and the Board of Directors on behalf of the Board of Directors.
Statement of financial position
58
Income statement, statement of comprehensive income
59
Statement of changes in equity
60
Statement of cash flows
61
Investor information
Consolidated financial statements 2009
Corporate accounting principles
66
Notes
71
Report of the Statutory Auditor
94
Financial statements Georg Fischer Ltd
62
Affiliated companies
Segment information
Consolidated financial statements
Notes to the consolidated financial statements
58 Georg Fischer
CONSOLIDATED FINANCIAL STATEMENTS
Statement of financial position as per 31 December 2009
million CHF
Notes
2009
%
2008
%
Investment properties
Property, plant and equipment for own use
Intangible assets
Investments in associates
Other financial assets
Deferred tax assets
Non-current assets
(3)
(3)
(4)
(5)
(7)
(8, 15)
41
1 065
277
50
36
1 101
346
1
4
55
1 543
47
577
431
15
75
5
316
1 419
50
4
801
566
22
105
17
233
1 748
53
Assets
2 866
100
3 291
100
Share capital
Share premium
Retained earnings
Equity attributable to shareholders of Georg Fischer Ltd
Non-controlling interests
Equity
82
181
844
1 107
45
1 152
38
2
40
101
167
1 088
1 356
48
1 404
41
2
43
26
110
174
87
76
158
16
621
19
164
157
77
42
274
38
212
964
34
262
200
77
43
388
36
260
1 266
38
Liabilities
1 714
60
1 887
57
Liabilities and equity
2 866
100
3 291
100
Assets held for sale
Inventories
Trade accounts receivable
Income taxes receivable
Other accounts receivable
Marketable securities
Cash and cash equivalents
Current assets
(9)
(10)
(11)
(12)
(13)
(23)
Bank liabilities
Bonds
Deferred tax liabilities
Provisions
Employee benefits
Other non-current liabilities
Non-current liabilities
(19)
(14, 19)
(15)
(16, 29)
(17)
Bank liabilities
Bonds
Provisions
Employee benefits
Trade accounts payable
Current tax liabilities
Other current liabilities
Current liabilities
(19)
(14, 19)
(16, 29)
(17, 19)
(18)
8
56
1 447
127
297
73
76
160
17
750
Georg Fischer 59
Income statement for the year ended 31 December 2009
2009
2 975
Sales deductions
Sales
–69
2 906
Changes in inventory
Other operating income
Income
(26)
Cost of materials and products
Operating expenses1
Gross value added1
(27)
Personnel expenses1
Depreciation1
Amortization1
EBIT before special charges
(28)
(3)
(4)
Restructuring expenses1
Impairment on goodwill and property, plant and equipment1
EBIT
(29)
(29)
Interest income
Interest expense
Other financial result
Result of investment properties
Share of results of associates
Profit / (loss) before taxes
(30)
(30)
(30)
Income taxes
Net profit / (loss)
thereof attributable to shareholders of Georg Fischer Ltd
thereof attributable to non-controlling interests
(31)
Basic earnings / (loss) per share in CHF
Diluted earnings / (loss) per share in CHF
(32)
(32)
2008
%
4 533
–79
51
2 878
–1 326
–553
999
–893
–152
–12
–58
–90
–53
–201
100
–68
4 465
100
99
49
106
4 620
103
34
–2 277
–840
1 503
34
–2
–1 103
–159
–14
227
5
–7
–10
–83
134
3
2
–35
–7
4
1
–236
5
–37
–6
Investor information
Gross sales
%
Consolidated financial statements
Notes
96
–2
–238
–246
8
–8
–61
–61
–27
69
56
13
2
14
14
1 Certain previously reported figures were reclassified to conform with the current year‘s presentation.
Financial statements Georg Fischer Ltd
million CHF
million CHF
2009
2008
Net profit / (loss)
–238
69
–3
4
1
–103
2
5
–96
–237
–244
7
–27
–39
12
Other comprehensive income
Translation adjustments recognized in the reporting period
Cumulated translation adjustments transferred to the income statement
Income taxes on other comprehensive income
Other comprehensive income, net of taxes
Total comprehensive income
thereof attributable to shareholders of Georg Fischer Ltd
thereof attributable to non-controlling interests
Affiliated companies
Statement of comprehensive income for the year ended 31 December 2009
60 Georg Fischer
CONSOLIDATED FINANCIAL STATEMENTS
Equity
1 540
56
56
56
13
69
–102
–102
–102
–1
–103
2
5
–95
2
5
–95
2
5
–95
–1
2
5
–96
–55
Net profit
Other comprehensive income
Translation adjustments recognized in
the reporting period
Cumulated translation adjustments transferred
to the income statement
Income taxes on other comprehensive income
Other comprehensive income, net of taxes
Total comprehensive income
Purchase of own shares
Disposal of own shares
Share-related compensation
Reduction in par value / dividends
–100
Balance as per 31 December 2008
101
–1
1
–26
21
5
167
–150
Total comprehensive income
Purchase of own shares
Disposal of own shares
Share-related compensation
Capital increase non-controlling interests
Reduction in par value / dividends
Balance as per 31 December 2009
2
–9
–27
–27
22
5
–109
1 356
48
1 404
–246
–246
–246
8
–238
–2
–2
–2
–1
–3
4
4
4
2
2
2
–1
1
–244
–2
16
2
7
–2
14
2
181
12
1 088
–21
82
–39
–27
22
5
–100
1 238
Net profit / (loss)
Other comprehensive income
Translation adjustments recognized in
the reporting period
Cumulated translation adjustments transferred
to the income statement
Income taxes on other comprehensive income
Other comprehensive income, net of taxes
Equity attributable
to shareholders
of Georg Fischer Ltd
45
167
Retained earnings
1 495
201
Other retained earnings
1 127
Cumulative translation
adjustments
1 182
Share premium
Balance as per 31 December 2007
Share capital
million CHF
Non-controlling interests
Statement of changes in equity
for the year ended 31 December 2009
–148
992
844
4
–21
2
–12
–237
–2
16
2
2
–33
1 107
45
1 152
Translation adjustments are mainly due to the change of the Chinese renminbi, the Brazilian real and the euro.
Income tax recognized directly in equity amounts to an expense of less than CHF 1 million (previous year: CHF 6 million income) and
relates to the disposal of own shares.
Own shares with a par value of less than CHF 1 million (previous year: CHF 2 million) are deducted from the share capital. The related
surplus of CHF 2 million (previous year: CHF 11 million) is deducted from the share premium.
Regarding information about capital management see note 23.
Regarding share capital and own shares see notes to the financial statements of Georg Fischer Ltd on page 98f.
Georg Fischer 61
Net profit / (loss)
Income taxes1
Financial result
Depreciation1
Amortization1
Impairment on goodwill and property, plant and equipment1
Non-cash restructuring expenses
Other non-cash income and expenses
Increase in provisions, net
Use of provisions
Changes in
Inventories
Trade accounts receivable
Other accounts receivable
Trade accounts payable
Other non-interest-bearing liabilities
Interest paid
Income taxes paid
–238
2
40
152
12
53
32
25
52
–51
69
27
38
159
14
83
–30
67
–52
200
133
28
–111
–40
–36
–11
–102
145
–6
–59
–29
–31
–96
242
197
(3)
(4)
–148
–3
–1
–243
–4
(3)
(7)
12
1
(2)
(2, 29)
–9
–1
1
6
1
1
–209
50
4
–148
–394
94
–197
–2
16
2
–33
297
–218
358
–298
–131
–27
22
(31)
(30)
(3)
(4)
(29)
(29)
(16, 29)
(16, 29)
Cash flow from operating activities
Additions to
Property, plant and equipment
Intangible assets
Other financial assets
Disposals of
Property, plant and equipment
Other financial assets
Purchase / disposal of marketable securities
Cash flow from acquisitions
Cash flow from divestitures
Interest received
Cash flow from investing activities
Free cash flow
1
Purchase of own shares
Disposal of own shares1
Capital increase non-controlling interests
Par value reduction / dividends paid
Issue of bonds
Repayment of bonds
Increase of bank loans
Repayment of bank loans
Changes in other interest-bearing liabilities (mainly current bank accounts)
(14)
(14)
(19)
(19)
–109
82
–21
111
Cash flow from financing activities
–9
58
Translation adjustment on cash and cash equivalents
–2
–16
Net cash flow
83
–155
233
316
388
233
Cash and cash equivalents at beginning of year
Cash and cash equivalents at year-end2
Consolidated financial statements
2008
Financial statements Georg Fischer Ltd
2009
Notes
1
1 Certain previously reported figures were reclassified to conform with the current year‘s presentation.
2 Cash, postal and bank accounts: CHF 309 million (previous year: CHF 226 million), fixed-term deposits: CHF 7 million (previous year: CHF 7 million).
Affiliated companies
million CHF
Investor information
Statement of cash flows for the year ended 31 December 2009
62 Georg Fischer
CONSOLIDATED FINANCIAL STATEMENTS
Notes to the consolidated financial statements
GF Piping Systems
Segment information
million CHF
2009
2008
2007
Order intake
Orders on hand at year-end1
1 130
70
1 320
70
1 151
35
Gross sales2
Sales deductions
Sales
1 130
–64
1 066
1 284
–60
1 224
1 151
–55
1 096
129
39
10
168
38
8
158
31
1
EBIT before special charges
Restructuring expenses
Impairment on goodwill and property, plant and equipment
80
13
10
122
126
EBIT
57
122
126
1 079
1 159
895
40
3
53
2
65
11
479
549
517
23
23
21
EBITDA
Depreciation
Amortization
Assets 3
Material items of income and expense4
Investments
thereof investments in intangible assets
Liabilities
Research and development
1
2
3
4
In 2008 change of definition for GF Automotive.
Sales between the segments are not material.
The amount of investments in associates and joint ventures accounted for by the equity method is not material.
Gain on the divestiture of Georg Fischer Verkehrstechnik GmbH, Singen.
Georg Fischer 63
GF AgieCharmilles
2009
2008
2007
2009
2008
2007
2009
2008
2007
1 256
328
2 076
354
2 292
989
520
77
1 066
136
1 192
162
2 906
475
4 462
560
4 635
1 186
1 265
–4
1 261
2 167
–6
2 161
2 232
–9
2 223
579
–1
578
1 082
–2
1 080
1 181
–2
1 179
2 974
–69
2 905
4 533
–68
4 465
4 564
–66
4 498
37
96
1
183
100
5
235
98
5
–67
13
1
50
15
1
93
16
1
99
148
12
401
153
14
486
145
7
–60
49
78
132
–81
27
43
34
8
76
–61
89
53
234
8
83
334
83
–109
–5
132
–151
26
76
–203
143
334
1 330
1 452
1 595
560
822
901
2 969
3 433
3 391
102
175
1
147
5
3
12
1
14
1
145
3
240
4
226
17
1 019
1 140
1 269
377
468
500
1 875
2 157
2 286
52
65
67
41
55
56
116
143
144
Financial statements Georg Fischer Ltd
35
Affiliated companies
35
Investor information
Total segments
Consolidated financial statements
GF Automotive
64 Georg Fischer
CONSOLIDATED FINANCIAL STATEMENTS
Reconciliation to the segment information
million CHF
2009
2008
2007
4 498
1
–2
4 497
Sales
Total sales for reportable segments
Other sales
Elimination of intercompany sales
Consolidated sales
2 905
1
4 465
2 906
4 465
EBIT
Total EBIT for reportable segments
Other EBIT
Other unallocated amounts
Consolidated EBIT
–203
1
1
–201
143
–8
–1
134
334
–8
Interest income
Interest expense
Other financial result
Result of investment properties
Share of results of associates
Profit / (loss) before taxes
2
–35
–7
4
1
–236
5
–37
–6
96
11
–40
7
6
1
311
2 969
–333
3 433
–286
3 391
–286
23
55
1
192
–41
2 866
24
56
1
95
–32
3 291
20
62
2
209
–5
3 393
145
6
151
240
7
247
226
8
234
1 875
–723
2 157
–874
2 286
–952
73
454
6
50
–21
1 714
176
374
5
62
–13
1 887
38
373
6
94
8
1 853
Assets
Total assets for reportable segments
Elimination of intercompany positions
Other assets
Investment properties
Property, plant and equipment for own use
Other non-current assets
Other current assets (mainly cash and cash equivalents)
Other unallocated amounts
Consolidated assets
Investments
Total investments for reportable segments
Other investments
Investments Corporation
Liabilities
Total liabilities for reportable segments
Elimination of intercompany positions
Other liabilities
Bank liabilities
Bonds
Other interest-bearing liabilities
Other non-interest-bearing liabilities
Other unallocated amounts
Consolidated liabilities
326
Georg Fischer 65
Geographical information
2008
2007
2009
2008
2007
Total
European Union
thereof Germany
Other European countries
thereof Switzerland
America
Asia
Other countries
1 447
792
439
351
351
132
172
1 543
839
453
407
407
158
139
1 443
961
501
328
328
49
105
2 906
1 877
1 026
223
167
302
455
49
4 465
3 144
1 789
287
180
423
533
78
4 497
3 273
1 838
274
164
343
536
71
Products and services
Sales
million CHF
2009
2008
2007
GF Piping Systems
1 066
1 224
1 096
353
388
325
458
505
261
494
368
234
1 261
2 161
2 223
Passenger cars
Trucks
Non-automotive
955
223
83
1 312
680
169
1 358
692
173
GF AgieCharmilles
578
1 080
1 179
EDM (Electric discharge machines)
Milling (Milling machines)
Automation / Tooling
Customer service
176
152
39
211
407
309
77
287
485
296
83
315
Industry1
Utility2
Building technology3
GF Automotive
1 Products for the treatment and transport of water and other media for industrial applications.
2 Products for the supply of gas and water.
3 Products for the supply of water in buildings.
Information
about major customers
There are no single customers whose sales amount to 10 % or more of the sales of the Corporation.
Consolidated financial statements
2009
Financial statements Georg Fischer Ltd
million CHF
Investor information
Sales
Affiliated companies
Non-current assets
66 Georg Fischer
CONSOLIDATED FINANCIAL STATEMENTS
Corporate accounting principles
Accounting policies
General. The consolidated financial statements of Georg
Fischer Ltd have been prepared in accordance with the International
Financial Reporting Standards (IFRS) and comply with Swiss law.
They are based on the financial statements of the Georg Fischer
corporate subsidiaries for the year ended 31 December, prepared
in accordance with uniform corporate accounting principles.
Furthermore, the consolidated financial statements are
based on historical cost, with the exception of marketable
securities, participations under 20 % and derivative financial instruments, which are measured at fair value. The preparation of
the consolidated financial statements requires management to
make estimates and assumptions that affect the reported amounts
of revenues, expenses, assets and liabilities, and the disclosure of
contingent liabilities at the date of the consolidated financial statements. If in the future such estimates and assumptions, which
are based on management’s best judgement at the closing date,
deviate from the actual circumstances, the original estimates and
assumptions will be modified as appropriate in the year in which
the circumstances change. Where necessary, the comparatives
have been reclassified or extended from the previously reported
amounts to take into account changes in presentation.
Scope and principles of consolidation. The scope of consolidation includes Georg Fischer Ltd and all Swiss and foreign
subsidiaries which the parent company, directly or indirectly,
controls either by holding more than 50 % of the voting rights
or by having otherwise the power to govern their operating and
financial policies. Those entities are fully consolidated, whereby
assets, liabilities, income and expenses are incorporated in the
consolidated accounts. Intercompany balances and transactions
(accounts receivable, accounts payable, income and expenses) are
eliminated upon consolidation. Non-controlling interests in the
equity and net income of consolidated companies are presented
separately but as a component of consolidated equity and consolidated net income respectively. Gains arising from intercompany
transactions are eliminated in full. Capital consolidation is based
on the purchase method, whereby the acquisition cost of a subsidiary is eliminated at the time of acquisition against the fair value
of net assets acquired, determined according to uniform corporate accounting principles.
Companies acquired are consolidated from the date on
which control is obtained, while companies sold are excluded from
the scope of consolidation as of the date on which control is given
up, with any gain or loss recognized in income.
Upon the acquisition of non-controlling interests in a fully
consolidated entity, any difference between the purchase price
and the carrying amount of such non-controlling interests is recognized in share premium. Upon the disposal of non-controlling
interests while control of the entity is retained, any excess or
shortfall of proceeds over the carrying amount is also recognized
in share premium.
Joint ventures in which Georg Fischer Ltd has a direct or
indirect participation of 50 %, or where the Georg Fischer Corporation exercises joint control, are included in the consolidated financial statements using the proportionate consolidation method.
Companies in which the Georg Fischer Corporation
has a non-controlling interest of at least 20 % but less than
50 %, or over which it otherwise has significant influence, are
included in the consolidated financial statements using the equity
method of accounting and presented as investments in associates.
Investments with a voting power of less than 20 % are stated at
fair value and presented under other financial assets, with the unrealized gains and losses recognized in retained earnings. At the
time of disposal or in the case of an impairment of an investment,
the related cumulative gain or loss is transferred to the income
statement.
Gross sales and revenue recognition. Billings for goods and
services are recognized as gross sales when they are delivered
or when the risks and benefits incidental to ownership are transferred. Gross sales are stated before value added tax, sales tax
and any deduction of discounts and credits. Appropriate warranty
provisions are recognized for anticipated claims.
Foreign currencies. Corporate subsidiaries prepare their
financial statements in their functional currency. Monetary assets
and liabilities held in foreign currencies are translated at the spot
rate on the balance sheet date. Foreign exchange gains and losses
resulting from transactions and from the translation of balance
sheet items denominated in foreign currencies are reported in the
income statement. Derivative financial instruments used to hedge
such balance sheet items are stated at fair value, whereby the fair
value fluctuations are also recognized in the income statement.
The consolidated financial statements are prepared and presented in Swiss francs. For consolidation purposes, the financial
statements of the foreign entities are translated into Swiss francs
as follows: statement of financial position at year-end rates, income statement and statement of cash flows at average rates for
the year under review. Any translation adjustment resulting from
the translation of statements of financial position and income
statements, as well as the foreign exchange gains and losses
arising from the translation of equity-like corporate loans denominated in foreign currencies, are recognized in retained earnings.
In case of the disposal of a foreign subsidiary or the repayment
of a equity-like corporate loan the corresponding accumulated
translation adjustments are transferred to the income statement.
Maturities. Assets that are either realized or consumed in
the course of the Corporation’s normal operating cycle within one
year or held for trading are included in current assets. All other
assets are included in non-current assets.
All liabilities that the Corporation intends to settle in the
course of its normal operating cycle or that fall due within one
year of the balance sheet date are included in current liabilities.
All other liabilities are included in non-current liabilities.
Intangible assets. Intangible assets embodying future economic benefits, such as acquired royalties, patents and similar
rights, are capitalized and amortized on a straight-line basis over
their estimated useful lifes of 3 to 15 years with the exception of
land use rights. Land use rights are amortized over the duration of
the given right. Therefore useful lifes are up to 50 years. Goodwill
is calculated as the difference between the purchase price of an
acquired company and the fair value of the acquired assets, liabilities and contingent liabilities. Goodwill and other intangible assets with an indefinite useful life are not amortized but are tested
annually for impairment. For this purpose goodwill is allocated to
cash generating units.
Accounts receivable. Short-term accounts receivable are
stated at amortized cost, which generally correspond to nominal
value. Value adjustments for doubtful debts are established based
on maturity structure and identifiable solvency risks. Besides
individual value adjustments with respect to specific identifiable
risks, value adjustments are also recognized based on statistically
determined credit risks.
Derivative financial instruments. Derivative financial instruments are reported under marketable securities and other current
liabilities respectively. Foreign currency and interest rate risks are
hedged by the Corporation using forward foreign currency rate
contracts, currency options and swaps. Hedge accounting in the
sense of IAS 39 has not yet been applied. Derivative financial instruments are stated at fair value, and unrealized gains and losses on
the hedging of operating cash flows are reported in the operating
result, whereas gains and losses on the hedging of the financing are
reported in the financial result.
Marketable securities. Marketable securities include investments held for trading and derivative financial instruments.
Acquisitions and disposals are recognized on trade date, rather
than settlement date. Held-for-trading investments are stated at
market value, unrealized gains and losses being recognized in the
income statement and presented in the financial result.
Cash and cash equivalents. Cash and cash equivalents are
stated at nominal value. They include cash on hand, postal and
bank accounts and fixed-term deposits with an original maturity
of up to 90 days.
Consolidated financial statements
Inventories. Goods held for trading are generally stated
at average cost and internally manufactured products at manufacturing cost, including direct labour and materials used, as well
as a commensurate share of related overhead costs. If the net
realizable value is lower, valuation adjustments are made accordingly. Inventories with an unsatisfying turnover are partly or fully
adjusted in value. Prepayments to suppliers are added to inventories, whilst prepayments received from customers on orders in
progress are deducted.
Financial statements Georg Fischer Ltd
Property, plant and equipment. Items of property, plant and
equipment are stated at cost or manufacturing cost less depreciation and impairment. This is also valid for investment properties.
Assets acquired under finance lease contracts are capitalized at
the lower of minimum lease payments and fair value. The related
outstanding finance lease obligations are presented under liabilities. Assets are depreciated on a straight-line basis over their
estimated useful lifes or lease terms: buildings for operating or
investment purposes 20 to 40 years, machinery 3 to 15 years, other
equipment (vehicles, EDP, etc.) 3 to 5 years. Where components
of larger assets have different useful lives, these components
are depreciated separately. Useful lifes and residual values are
reviewed annually at the balance sheet date and any adjustments
are recognized in the income statement. Any gains or losses on
the disposal of items of property, plant and equipment are recognized in the income statement.
Other financial assets. Other financial assets mainly comprise loans to third parties, non-controlling interests of less than
20 % held over the longer term and pension assets. Loans are
stated at amortized cost less valuation adjustments; the related
interest income is recognized using the effective interest method.
Non-controlling interests are stated at their estimated fair value,
whereby unrealized gains and losses are recognized in retained
earnings; at the time of disposal or upon impairment, they are
transferred to the income statement.
Affiliated companies
Segment information. In accordance with the management
structure and the reporting made to the Executive Committee and
the Board of Directors, the reportable segments are the three
operating Corporate Groups GF Piping Systems, GF Automotive
and GF AgieCharmilles. GF Piping Systems develops, manufactures
and distributes piping systems for industry, utility and building technology. GF Automotive produces castings for the automotive industry. GF AgieCharmilles develops, manufactures and distributes
electric discharge machines, milling machines and automation
solutions. GF AgieCharmilles also provides services for these
products. Business units within these segments, which in some
cases also meet the size threshold under IFRS 8, have been aggregated as a single reportable segment because they manufacture similar products with comparable production processes and
supply them to similar customer groups using similar distribution
methods. Segment accounting is prepared up to the level of EBIT
because this is the key figure used for management purposes. All
operating assets and liabilities that are directly attributable or can
be allocated on a reasonable basis are reported in the respective
Corporate Groups. No distinction is made between the accounting
policies of segment reporting and those of the consolidated financial statements.
Investor information
Georg Fischer 67
68 Georg Fischer
CONSOLIDATED FINANCIAL STATEMENTS
Employee benefits. Post-employment plans for employees are maintained based on the respective legislation in each
country. They mainly comprise funds and foundations that are
financially independent from the Corporation. Some of these
funds are defined contribution plans, some defined benefit plans.
Pension funds are generally financed by employer and employee
contributions. In the case of defined contribution plans, employer
contributions paid or due are recognized in the income statement
as incurred. In the case of defined benefit plans, the present value
of the defined benefit obligation is calculated by applying the projected unit credit method. All significant pension fund obligations
and the related plan assets are assessed annually. Current service costs are recognized in the income statement. Past service
costs are recognized in the income statement on a straight-line
basis over the period until the benefits become vested. Actuarial
gains and losses are recognized in the income statement on a
straight-line basis over the average remaining service years to
the extent that they exceed 10 % of the fair value of plan assets or
the present value of the defined benefit obligations of prior year,
whichever is higher. Deficits arising from such calculations as of
the balance sheet date are recognized according to this mechanism. Surpluses are only capitalized if they are actually available
to the Corporation in the form of expected refunds from the fund
or reductions in contributions to the fund. They are disclosed under other financial assets.
Taxes. Taxes are accrued for all tax obligations, irrespective
of their due date. Current income taxes are calculated on the taxable profit. Deferred taxes are calculated by applying the balance
sheet liability method for any temporary difference between the
carrying amount according to IFRS and the tax basis of assets
and liabilities. Tax loss carryforwards are recognized only to the
extent that it is probable that future taxable profits or deferred
tax liabilities will be available against which they can be offset.
Calculation of deferred taxes is based on the country-specific
tax rates. Tax assets and liabilities are offset if they concern the
same taxable entity and tax authority and if there exists an offset
entitlement for current taxes.
Provisions. Provisions are recognized for any present obligation incurred as a result of a past event if it is probable that an
outflow of resources will be required to settle the obligation and
the amount can be estimated reliably.
Leases. The present value of contractual lease obligations
is recognized on the statement of financial position if the significant contractual risks and rewards have been transferred to
the consolidated entity. Lease instalments are divided into an interest and a redemption component based on the annuity method.
Assets held under such finance leases are depreciated over the
shorter of their estimated useful life and the lease term. Operating lease instalments are charged to the income statement on a
straight-line basis over the lease term.
Financial liabilities. Financial liabilities comprise bank
loans, mortgages, convertible and other bonds. They are carried
at amortized cost. Borrowing costs are recognized in the income
statement using the effective interest method with the exception
of borrowing costs that can be allocated directly to the construction, build-up or purchase of a qualifying asset. These borrowing
costs are capitalized as part of the costs of this asset. Convertible
bonds are broken down into a liability and an equity component,
with the repayment amount of the liability component calculated
using the effective interest method and recognized in the income
statement over the term of the loan.
Research and development. All research costs are recognized in the income statement as incurred. Development costs are
recognized as an asset only to the extent that specific recognition
criteria are met and the amount recognized is recoverable through
future cash flows.
Impairment. The recoverable amount of non-current assets
is reviewed at least once a year. If there is any indication of an impairment, an impairment test is performed immediately. Goodwill
and intangible assets with an indefinite useful life are tested for
impairment on an annual basis. If the carrying amount exceeds
the recoverable amount, an impairment loss is recognized in the
income statement.
Own shares, share-based payments and earnings / (loss) per
share. Own shares are deducted from the share capital at their
nominal value. Costs in excess of nominal value arising on the
acquisition of own shares are deducted from the related share
premium, and gains or losses arising on the disposal of own
shares are respectively credited to and deducted from the related
share premium.
Share-based payments to members of the Executive Committee and senior management (particularly shares issued free of
charge) are measured at fair value at the grant date and recognized as a personnel expense over the vesting period.
Earnings / (loss) per share are calculated by dividing the
portion of net income attributable to Georg Fischer Ltd shareholders by the weighted average number of ordinary shares outstanding in the reporting period. Diluted earnings / (loss) per share
take into account any potential ordinary shares that may result
from exercised option or conversion rights.
With the exception of IFRS 8, IAS 1 and IAS 23 these
changes had no significant effect on the consolidated financial
statements.
As the internal reporting to the Executive Committee and
the Board of Directors is generated according to the existing
Corporate Groups and based on the same recognition and measurement principles as the consolidated financial statements,
there have been no changes in the definition of the operative
segments due to the adoption of IFRS 8 but additional disclosures
for the total year. The adoption of IAS 1 revised led to the additional disclosure of the statement of comprehensive income. The
adoption of IAS 23 revised led to an insignificant capitalization of
borrowing costs for current investment projects.
Management assumptions and estimates
Significant accounting policies. Preparation of financial
statements requires management to make estimates and assumptions that could materially affect the consolidated financial
statements of Georg Fischer, particularly with regard to the items
described below, should actual results differ from these management estimates and assumptions.
Impairment of non-current assets. In addition to the regular, periodic test applied to goodwill items, non-current assets
are reviewed whenever there are indications that, due to changed
circumstances or events, their carrying amount may no longer be
recoverable. If such a situation arises, the recoverable amount
is determined on the basis of expected future inflows. It corresponds to either the discounted value of expected future net cash
flows or the expected net selling price. If the recoverable amount
is below the carrying amount a corresponding impairment loss
is recognized in the income statement. The main assumptions
on which these measurements are based include growth rates,
Provisions for warranties and onerous contracts. In the
course of their ordinary operating activities, corporate subsidiaries can become involved in litigation. Provisions for pending
legal proceedings are measured on the basis of the information
available and a realistic estimate of the expected outflow of resources. The outcome of these proceedings may result in claims
against the Corporation that cannot be met at all or in full through
provisions or insurance cover.
If there are any contractual obligations for which the unavoidable costs of meeting the obligations under the contract exceed the expected economic benefits to be received (e.g. onerous
delivery contracts), provisions for the agreed quantities over the
whole or prudently estimated period are made. These provisions
are based on management assumptions. The carrying amounts of
these provisions are set out in note 16.
Employee benefit plans. Georg Fischer uses various employee benefit plans. The majority of its salaried employees are
covered by these plans. In order to measure liabilities and costs,
it is first of all necessary to assess whether the plans are defined contribution or defined benefit plans by applying the principle of substance over form. If they are defined benefit plans,
actuarial assumptions are made for the purpose of estimating
future developments. These include estimates and assumptions
relating to discount rates, the expected return on plan assets in
individual countries and future wage trends. The actuaries also
use statistical data such as mortality tables and staff turnover
rates in the actuarial calculations they perform with a view to
determining employee benefit obligations. If these parameters
change due to a change in economic or market conditions, the
subsequent results can deviate considerably from the actuarial
reports and calculations. Over the medium term, these deviations can have a significant effect on income and expenses
arising from employee benefits plans. The carrying amounts of
the plan assets and liabilities carried in the statement of financial position are set out in note 17.
Consolidated financial statements
Further Georg Fischer applied from 1 January 2009 the
following revised standards:
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™ >6H'(Æ7dggdl^c\8dhihÇ
™ >6H('Æ;^cVcX^Va>chigjbZcih/EgZhZciVi^dcÇ
™ >6H(.$>;G>8.Æ:bWZYYZY9Zg^kVi^kZhÇ
Financial statements Georg Fischer Ltd
With effect from 1 January 2009, Georg Fischer initially
applied the following new standards and interpretations issued
by the IASB:
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™ >;G>8&(Æ8jhidbZgAdnVainEgd\gVbbZhÇ
™ >;G>8&*Æ6\gZZbZcih[dgi]Z8dchigjXi^dcd[GZVa:hiViZÇ
™ >;G>8&+Æ=ZY\Zhd[VCZi>ckZhibZci^cV;dgZ^\cDeZgVi^dcÇ
™ >;G>8&-ÆIgVch[Zghd[6hhZih[gdb8jhidbZghÇ
(effective as of 1 July 2009)
margins and discount rates. The cash inflows actually generated
can differ considerably from discounted projections. Since October 2008 the estimation of sales for the next 3 to 5 years is afflicted with particular uncertainties due to the significantly changed
market environment. In addition, useful lives can become shorter
or assets impaired if the purpose for which property, plant and
equipment are used changes, sites are relocated or closed, or
medium-term revenues are lower than expected. The carrying
amounts and information regarding impairments of the items of
property, plant and equipment and intangible assets affected are
set out in notes 3 and 4.
Affiliated companies
Changes in accounting principles
Investor information
Georg Fischer 69
70 Georg Fischer
CONSOLIDATED FINANCIAL STATEMENTS
Income taxes. Current tax liabilities are measured on the
basis of an interpretation of the tax regulations in place in the
relevant countries. The adequacy of this interpretation is assessed
by the tax authorities in the course of the final assessment or tax
audits. This can result in material changes to tax expense. Furthermore, in order to determine whether tax loss carryforwards may
be carried as an asset, it is first necessary to critically assess the
probability that there will be future taxable profit against which to
offset them. This assessment depends on a variety of influencing
factors and developments. The carrying amounts of current and
deferred tax assets and liabilities are disclosed in the consolidated
statement of financial position.
Standards that have been approved
but not yet applied
The following new and revised standards and interpretations had been approved by the time the consolidated financial
statements were authorized for issue by the Board of Directors.
However, they do not take effect until later on and were not adopted
early in preparing this set of consolidated financial statements.
Since their effect on the consolidated financial statements of Georg
Fischer has not yet been systematically analyzed, the anticipated
effects as disclosed at the foot of the table are merely an initial
estimate on the part of the Executive Committee.
Date planned for
Standard / Interpretation
Effective date
adoption by Georg Fischer
*
1 July 2009
Financial year 2010
IFRIC 19 – Extinguishing Financial Liabilities
with Equity Instruments
*
1 July 2010
Financial year 2011
IFRS 9 – Financial Instruments
***
1 January 2013
Financial year 2013
****
1 July 2009
Financial year 2010
New Standards and Interpretations
IFRIC 17 – Distributions of Non-cash Assets to Owners
Revised Standards und Interpretations
IFRS 3 – Business Combinations
IAS 27 – Consolidated and Separate Financial Statements
****
1 July 2009
Financial year 2010
Improvements to IFRSs (April 2009)
*
1 July 2009
1 January 2010
Financial year 2010
IAS 39 – Financial Instruments: Recognition and
Measurement (Eligible Hedged Items)
*
1 July 2009
Financial year 2010
IFRS 1 – First-time Adoption of International Financial
Reporting Standards
*
1 July 2009
1 January 2010
n/a
IFRS 2 – Share-based Payment (Group Cash-settled
Share-based Payment Transactions)
*
1 January 2010
Financial year 2010
IAS 32 / IAS 1 – Financial Instruments: Presentation /
Presentation of Financial Statements
(Classification of Rights Issues)
*
1 February 2010
Financial year 2011
IFRIC 14 – Prepayments of a Minimum Funding Requirement
*
1 January 2011
Financial year 2011
IAS 24 – Related Party Disclosures
**
1 January 2011
Financial year 2011
*
**
***
****
No or no significant impacts are expected on the consolidated financial statements of Georg Fischer.
Mainly additional disclosures are expected in the consolidated financial statements of Georg Fischer.
The impacts on the consolidated financial statements of Georg Fischer can not yet be determined with sufficient reliability.
This Standard will have an effect on transactions effective on or after 1 January 2010.
Georg Fischer 71
Notes
1
Changes in scope of consolidation
Additions (Formation)
Disposals
as per 15 March 2009
Georg Fischer Corys LLC, Dubai
Joint venture, share Georg Fischer 49 %
Pro rata sales 2009: No sales (company setup)
GF Piping Systems
as per 30 June 2009
Georg Fischer GmbH & Co KG, Gleisdorf
Pro rata sales 2009: CHF 19 million
GF Automotive
million CHF
Acquisitions
Property, plant and equipment
Intangible assets
Deferred tax assets
Other financial assets
Inventories
Trade accounts receivable
Other accounts receivable
Cash and cash equivalents
2009
Divestitures
Acquisitions
2008
Divestitures
8
–94
–47
2
4
6
4
2
1
–1
–68
–30
–11
–14
14
18
1
–3
Provisions
Employee benefits
Deferred tax liabilities
Other non-current liabilities
Trade accounts payable
Other current liabilities
–1
–2
27
3
35
–3
–4
7
33
Net assets
Cash and cash equivalents acquired / disposed of
Net assets acquired / disposed of, excl. cash and cash equivalents
15
–1
14
–160
14
–146
13
–15
–75
3
35
Goodwill
Gain and loss on acquisitions / divestitures, net1
Receivables from acquisitions and divestitures (–) /
settlement of receivables (+)
Liabilities from acquisitions and divestitures (+) /
settlement of liabilities (–)
Net cash flow from acquisitions and divestitures
1
13
–1
–10
–9
–9
–7
–3
–1
10
2
–209
50
Consolidated financial statements
Cash flow from acquisitions and divestitures
Financial statements Georg Fischer Ltd
2
Investor information
During the year under review the scope of consolidation changed as follows:
Divestitures include the disposal of Georg Fischer GmbH & Co KG, Gleisdorf in the reporting period. The subsidiary was sold for one euro.
An amount of CHF 10 million was paid during the year under review for the acquisition of Central Plastics LLC in the previous year.
Net cash flow from acquisitions in the amount of CHF –209 million in the previous year were mainly related to the acquisition of Central
Plastics LLC (CHF –116 million) and to the acquisition of JRG Gunzenhauser AG (CHF –86 million).
Affiliated companies
1 Regarding loss on divestitures in the year under review see note 29; regarding gain on divestitures in the previous year see note 26.
Cost
As per 31 December 2007
Additions
Disposals
Changes in scope of consolidation
Other changes, reclassifications
Translation adjustment
As per 31 December 2008
Additions
Disposals
Changes in scope of consolidation
Other changes, reclassifications
Translation adjustment
As per 31 December 2009
Accumulated depreciation
As per 31 December 2007
Additions
Impairment
Disposals
Changes in scope of consolidation
Other changes, reclassifications
Translation adjustment
35
1
10
8
–2
43
–1
11
–4
52
1
–1
49
12
–2
640
8
–4
31
–2
–42
127
6
–4
631
8
–1
–4
38
–2
127
2
–4
–1
2
5
–7
1 821
84
–25
29
71
–172
363
12
–23
7
6
–15
1 808
54
–40
–50
94
–9
350
7
–11
–1
11
–1
119
132
5
1
3 118
243
–57
82
–9
–250
6
–1
3 127
148
–57
–56
–2
–13
4
–89
–10
156
77
–1
Property, plant and
equipment for own use
Assets held under
finance leases
Assets under
construction
Other equipment
Building
components
Buildings
million CHF
Land
Movements of property, plant
and equipment
Investment
properties
3
CONSOLIDATED FINANCIAL STATEMENTS
Machinery and
production equipment
72 Georg Fischer
–145
64
47
670
126
1 857
355
87
5
3 147
–12
–1
–400
–18
–73
–8
–287
–21
–1
–1
–3
–4
–1
3
3
4
26
3
–1 272
–110
–48
23
–1
1
126
–2 038
–159
–51
51
–1
4
168
–385
–18
–75
–7
–274
–20
2
2
3
1
–1
–1 281
–106
–8
39
44
–3
4
–4
As per 31 December 2008
Additions
Impairment
Disposals
Changes in scope of consolidation
Other changes, reclassifications
Translation adjustment
–16
–1
As per 31 December 2009
–23
Carrying amount
As per 31 December 2008
As per 31 December 2009
36
41
–6
–1
1
48
47
22
–1
12
10
1
1
–6
–1
–1
1
–4
–2 026
–152
–9
53
48
–1
5
1
–399
–79
–1 311
–282
–7
–4
–2 082
246
271
52
47
527
546
76
73
150
80
2
1
1 101
1 065
Insurance value of property, plant and equipment amounts to CHF 4,537 million (previous year: CHF 4,112 million).
I]ZkVajZhh]dlc^ci]Za^cZÆ8]Vc\Zh^chXdeZd[Xdchda^YVi^dcÇgZhjai[gdbi]ZYZXdchda^YVi^dcd[i]Z<Zdg\;^hX]Zg<bW=8d@<!
Gleisdorf (carrying amount: CHF 8 million).
I]ZgZbV^c^c\[^\jgZh^ci]Za^cZhÆDi]ZgX]Vc\Zh!gZXaVhh^[^XVi^dchÇgZaViZidild[VXih#Dci]ZdcZ]VcY!VWj^aY^c\[dgbZganjhZYWni]Z
<Zdg\;^hX]Zg<bW=8d@<!<aZ^hYdg[cZZYZYidWZgZXaVhh^[^ZYidi]ZWVaVcXZh]ZZia^cZÆ>ckZhibZciegdeZgi^ZhÇXVggn^c\Vbdjci/
CHF 2 million) after the divestiture of the said company. On the other hand, the intention for the disposal of a property so far shown in the
WVaVcXZh]ZZia^cZÆ6hhZih]ZaY[dghVaZÇl^i]VXVggn^c\Vbdjcid[8=;)b^aa^dc]VhWZZcedhiedcZYYjZidi]ZVXijVah^ijVi^dcd[i]ZgZVa
ZhiViZbVg`Zi#I]ZVhhZi]VhWZZcigVch[ZggZYidi]Za^cZÆ>ckZhibZciegdeZgi^ZhÇ!XViX]^c\jedci]ZgZ\jaVgYZegZX^Vi^dc#
Georg Fischer 73
The additions to property, plant and equipment of 2009 in the amount of CHF 148 million came clearly below the additions to property, plant and equipment of 2008 (CHF 243 million). They contain capitalized borrowing costs in the amount of CHF 2 million relating to the construction of a production site of GF Automotive in Kunshan, China. The underlying interest rate hereof is 5.2 %. The
additions to property, plant and equipment can be allocated mainly to the two Corporate Groups GF Automotive (CHF 102 million) and
GF Piping Systems (CHF 37 million). About one third of the total additions to property, plant and equipment falls upon China. Committed additions to property, plant and equipment which will require the use of cash and cash equivalents in the years 2010 to 2014
amount to CHF 113 million (previous year: CHF 201 million). They can be allocated to the Corporate Groups as follows: GF Automotive
CHF 85 million; GF Piping Systems CHF 23 million; GF AgieCharmilles CHF 1 million; Corporate Management CHF 4 million.
Investor information
The structural programme caused impairment charges on property, plant and equipment in the amount of CHF 9 million which are shown
in the line restructuring expenses of the income statement. The majority of the amount refers to the restructuring of Georg Fischer
GmbH, Garching, where assets in the amount of CHF 6 million have been written off. The impairment charges of the previous year (CHF
51 million) were related to write-offs on property, plant and equipment in various GF Automotive plants, where the slump in demand due
to the worldwide economic slowdown resulted in a reassessment of the production capacities.
The fair value of investment properties, determined by internal experts on the basis of discounted earnings and current market values,
amounts to CHF 66 million (previous year: CHF 60 million). The increase of the value of investment properties is caused by the reclassification of buildings formerly used in the operation and of property with postponed intention for disposal.
Cost
As per 31 December 2007
Additions
Disposals
Changes in scope of consolidation
Other changes, reclassifications
Translation adjustment
Goodwill
Acquired
brandnames
Acquired customer
relationships
248
7
2
75
19
18
–13
7
–1
As per 31 December 2008
Additions
Disposals
Changes in scope of consolidation
Other changes, reclassifications
Translation adjustment
310
26
–5
1
As per 31 December 2009
305
Accumulated amortization
As per 31 December 2007
Additions
Impairment
Disposals
Changes in scope of consolidation
Other changes, reclassifications
Translation adjustment
Acquired
technologies
Others
Total
68
4
–3
1
1
–7
325
4
–3
120
1
–21
19
7
64
3
–18
-1
2
426
3
–18
–1
2
4
27
19
7
50
408
–2
–1
–1
–3
–41
–9
3
2
–43
–14
–32
3
2
4
4
–32
As per 31 December 2008
Additions
Impairment
Disposals
Changes in scope of consolidation
Other changes, reclassifications
Translation adjustment
–32
–3
–2
–1
–1
–3
–41
–9
–5
18
1
–2
–80
–12
–58
18
1
–2
2
As per 31 December 2009
–83
–5
–2
–3
–38
–131
Carrying amount
As per 31 December 2008
As per 31 December 2009
278
222
23
22
18
17
4
4
23
12
346
277
–53
2
>ci]ZegZk^djhnZVgi]ZXViZ\dg^ZhÆ6Xfj^gZYWgVcYcVbZhÇ!Æ6Xfj^gZYXjhidbZggZaVi^dch]^ehÇVcYÆ6Xfj^gZYiZX]cdad\^ZhÇ]VYWZZcY^hXadhZYjcYZgi]Z
XViZ\dgnÆDi]ZghÇ#
Financial statements Georg Fischer Ltd
million CHF
Consolidated financial statements
Movements of intangible assets
Affiliated companies
4
74 Georg Fischer
CONSOLIDATED FINANCIAL STATEMENTS
Goodwill positions refer to the following cash generating units (CGU):
million CHF
GF Piping Systems
Central Plastics Group
Georg Fischer TPA Srl
Others1
Total
GF Automotive
Technology Unit Die Casting
Total
GF AgieCharmilles
GF AgieCharmilles Group
Division Milling
Division System 3R
Others
Total
Total Corporation
Discount rate
2009
2008
8.4 %
8.7 %
8.0 % – 9.5 %
70
33
103
72
10
33
115
62
62
63
63
38
14
5
57
29
38
28
5
100
222
278
8.9 %
9.5 %
9.9 %
10.7 %
9.5 % – 10.7 %
1 The other goodwill positions of GF Piping Systems are the sum of different positions resulting from business combinations. None of them has
any significant value. Therefore they are stated as a total.
The existing goodwill positions of each CGU are tested for impairment on an annual basis. The recoverable amount of the CGUs equates
to their value in use which is determined based on future discounted cash flows.
As a basis for the calculation business plans for the next five years are used. Subsequent years are included in the calculation using a
perpetual annuity with a growth assumption of zero. The projections are based on knowledge and experience and also on current judgements made by management as to the probable economic development of the relevant markets.
It is assumed that there are no significant planned changes in the organization of any of the Corporate Groups, except for the already
decided and announced measures.
7nVeean^c\i]ZÆ8Ve^iVa6hhZiEg^X^c\BdYZaÇVheZX^[^XgViZ[dgi]ZXdhid[XVe^iValVhXVaXjaViZY[dgZVX]8<J#I]ZhZgViZhVgZ[dgZVX]
of the three Corporate Groups within the following range:
2009
2008
8.0 % – 9.5 %
7%
GF Piping Systems
GF Automotive
8.9 %
9%
9.5 % – 10.7 %
8%
GF AgieCharmilles
The calculations of these discount rates refer for each Corporate Group to the data of a relevant peer group. Furthermore CGU-specific
values for the risk free interest rate, the market risk premium, the borrowing costs and the tax rate were applied. Due to the fact that
cash inflows after taxes have been taken into account for the cash flow projections, the discount rate has been determined allowing for
the tax effects.
The impairment tests as of closing date showed that the values of the goodwill of Georg Fischer TPA Srl (GF Piping Systems) and
GF AgieCharmilles Group are not supported by the calculated value in use anymore. In both cases an impairment charge on the full carrying amount of goodwill was booked (Georg Fischer TPA Srl: CHF 10 million, GF AgieCharmilles Group: CHF 29 million). The impairment
of the goodwill of GF AgieCharmilles Group was triggered by the strong decrease in demand in the machine tool market. Despite the
measures initiated the goodwill of Georg Fischer TPA Srl had to be value adjusted completely due to the more prudent estimations for
the future market development. Within both CGUs the carrying amounts of all other assets are still covered by the value in use.
Further the impairment test of the goodwill Division System 3R showed that the carrying amount of this goodwill position is not covered
to the full extent by the value in use. Therefore an impairment charge of CHF 14 million had to be booked.
The impairment tests of all other goodwill positions support their carrying amounts.
Additionally sensitivity analysis were performed and showed the following results:
The impairment test of the goodwill of the Central Plastics Group (GF Piping Systems) resulted in a value in use which exceeds the
carrying amount by CHF 25 million. An increase of the discount rate by 2.1 %-points or a reduction of the growth rate of perpetuity from
0 % to –3.3 % would lead to a value in use that just covers the carrying amount of the net assets.
Georg Fischer 75
Despite the strong decrease in demand in the automotive industry, the value in use of the CGU Technology Unit Die Casting (GF Automotive) exceeds the carrying amount of the net assets by CHF 80 million, especially due to the positive development of the die casting
plant in China. An increase of the discount rate by 2.2 %-points or a reduction of the growth rate of perpetuity from 0 % to –3.7 % would
lead to a value in use that just covers the carrying amount of the net assets.
In the opinion of the management, there is no further realistic expectation of possible changes to the applied key assumptions that may
result in the carrying amounts of the other goodwill positions exceeding the respective recoverable amounts as the business plans on which
the impairment tests are based already take the current economic crises into account. This excludes unforeseen circumstances.
The carrying amount of acquired brandnames (CHF 22 million) stems to a large extent (CHF 18 million) from brands identified during
the purchase price allocation of the acquisitions of JRG Gunzenhauser AG (CHF 4 million) and Central Plastics LLC (CHF 14 million) in
the year 2008. Acquired customer relationships and technologies stem to the full amount from these acquisitions.
Investor information
For one corporate subsidiary of GF Piping Systems the value in use exceeds the carrying amount of the net assets by CHF 2 million. This
carrying amount contains goodwill in the amount of CHF 8 million. An increase of the discount rate by 0.5 %-points or a reduction of the
growth rate of perpetuity from 0 % to –0.7 % would lead to a value in use that just covers the carrying amount of the net assets.
For the brandnames of Central Plastics an indefinite useful life was defined. The carrying amount of this position was calculated during
i]ZejgX]VhZeg^XZVaadXVi^dcl^i]i]ZÆGZa^Z[d[GdnVai^ZhBZi]dYÇ#I]ZXVggn^c\Vbdjcid[i]^hedh^i^dc^hhi^aahjeedgiZYWni]ZgZXVaculation with this method for the reporting year. The other intangible assets are amortized on a straight line basis over 3 to 50 years.
5
Investments in associates
The investments included have a total carrying value of CHF 0.4 million. They are in detail:
– Wibilea AG, Neuhausen
– Eisenbergwerk Gonzen AG, Sargans
– Mecartex SA, Losone
– Giessereiservice Leipzig GmbH, Leipzig
– Georg Fischer Corys LLC, Dubai
Consolidated financial statements
The other intangible assets include to a major part land-use rights and software licenses for ERP-systems.
Categories of financial instruments
The following table shows the carrying amount of all financial instruments per category. They correspond, approximately, to the fair values
in accordance with IFRS. Regarding the market values of the bonds see note 14.
2009
2008
Cash and cash equivalents (without fix-term deposits)
309
226
Fix-term deposits
Other financial assets1
Trade accounts receivable
Other accounts receivable2
Loans and receivables stated at amortized cost
7
5
431
38
481
7
4
566
55
632
2
3
5
14
3
17
291
274
454
229
1 248
372
388
374
276
1 410
million CHF
Foreign currency forward rate contracts
Marketable securities
Financial assets at market value through profit or loss
Bank liabilities
Trade accounts payable
Bonds
Other current / non-current liabilities
Liabilities stated at amortized cost
1 Relates to loans third parties and security deposits.
2 Other accounts receivable include tax credits of CHF 37 million (previous year: CHF 50 million), which are not in the scope of IAS 39 and thus are not
included in this table.
Affiliated companies
6
Financial statements Georg Fischer Ltd
The share of their result is insignificant.
76 Georg Fischer
CONSOLIDATED FINANCIAL STATEMENTS
The carrying amount of the securities and listed non-controlling interests recognized at their fair value is determined on the basis of the
share prices at the balance sheet date. The market value of the foreign currency forward rate contracts on the statement of financial
position is determined by the replacement value at the balance sheet date.
Fair value hierarchy
The table below analyzes financial instruments carried at fair value, by valuation method.
The different levels have been defined as follows:
Level 1: quoted prices (unadjusted) in active markets for identical assets or liabilities.
Level 2: inputs other than quoted prices included within level 1 that are observable for the asset or the liability, either directly
(i.e. as prices) or indirectly (i.e. derived from prices).
Level 3: inputs for the asset or liability that are not based on observable market data (unobservable inputs).
Financial assets at market value through profit or loss
million CHF
Foreign currency forward rate contracts
Marketable securities
Total
Total
Level 1
2
3
5
3
3
Level 2
Level 3
2
2
Because no financial assets are to be reported on level 3, the disclosure of their movements is inapplicable.
7
Other financial assets
Other financial assets include long-term loans to third parties of CHF 3 million (previous year: CHF 3 million).
CHF 2 million of the long-term loans fall due in the next three years and CHF 1 million at a later date. CHF 2 million were lent in Brazilian
reais and less than CHF 1 million in Swiss francs and in euro. The interest rate for the loans granted in Brazil in local currency is 28 %.
The long-term loans in Brazil are receivables from customer financing activities.
8
Deferred tax assets
Deferred tax assets amount to CHF 56 million net (previous year: CHF 55 million). As per 31 December 2009, tax loss carryforwards of
CHF 97 million were activated resulting in a deferred tax asset of CHF 27 million (previous year: CHF 19 million). For further information
see notes 15 and 31.
9
Assets held for sale
The operating property in the amount of CHF 4 million – in previous year presented as assets held for sale – could not be sold as of end
2009. The building is no longer used for operating purposes for which reason it was reclassified to investment properties. The suspended
depreciation since the classification to assets held for sale in the amount of CHF 0.4 million was caught up in the period under review.
10 Inventories
2009
2008
Raw materials and components
Work in progress
Finished goods, goods held for trading
Gross value inventories on hand
251
146
383
780
323
182
474
979
Valuation allowances
Carrying amount inventories on hand
–166
614
–149
830
Prepayments to suppliers
Prepayments received from customers
Inventories
12
–49
577
13
–42
801
million CHF
Georg Fischer 77
11 Trade accounts receivable
Gross values
Individual value adjustments
Overall value adjustments
Net values
458
–7
–20
431
592
–7
–19
566
European Union
thereof Germany
thereof Eastern Europe
Other European countries
thereof Switzerland
Northern America
Central and Southern America
Asia
thereof China
Other countries
Total
253
96
20
15
11
34
21
97
25
11
431
349
132
22
36
24
42
21
105
30
13
566
At the balance sheet date the ageing structure of the trade receivables, which are not subject to individual value adjustments, is as
follows:
Not yet due
1 to 30 days overdue
31 to 90 days overdue
91 to 180 days overdue
More than 180 days overdue
Total
Receivables
354
41
23
13
20
451
1
1
4
14
20
Receivables
2008
Value
adjustments
446
59
42
17
21
585
1
1
1
3
13
19
Value adjustments on trade accounts receivable have changed as follows:
million CHF
Individual value adjustments
As per 1 January
Increase / decrease
As per 31 December
Overall value adjustments
As per 1 January
Increase / decrease
As per 31 December
2009
2008
7
4
3
7
7
19
1
20
19
19
The individual value adjustments amounted to CHF 7 million (previous year: CHF 7 million). It is assumed that part of the underlying receivables will be paid.
The receivables which are not due are mainly receivables arising from long-standing customer relationships. On past experience, Georg
Fischer does not anticipate any significant defaults.
For further information on credit management and trade accounts receivable see note 22.
Affiliated companies
million CHF
2009
Value
adjustments
Consolidated financial statements
2008
Financial statements Georg Fischer Ltd
2009
million CHF
Investor information
Trade accounts receivable are, as shown in the table below and where required, value adjusted and are allocated to the following regions:
78 Georg Fischer
CONSOLIDATED FINANCIAL STATEMENTS
12 Income taxes receivable
Out of the income taxes receivable CHF 11 million relate to Germany, CHF 2 million to France, CHF 1 million to Switzerland and
CHF 1 million to other countries.
13 Other accounts receivable
million CHF
Tax credits (excl. income taxes receivable)
Other current accounts receivable
Prepaid expenses and accrued income
Total
2009
2008
37
24
14
75
50
28
27
105
14 Bonds
million CHF
Issuing
currency
Nominal
value
Market
value
Effective
interest rate
2009
2008
174
Bonds (Georg Fischer Ltd)
31/2 % 1999 – 2009 (5 February)
CHF
31/2 % 2004 – 2010 (15 September)
CHF
157
159
3.8 %
157
CHF
300
314
4.7 %
297
457
473
200
Bond (Georg Fischer Finanz AG)
41/2 % 2009 – 2014 (22 September)
Total
454
374
In the period under review the 41/2 % bond 2009 – 2014 was issued. The amount issued can be increased at any time as under the 31/2 %
bond 2004 – 2010. A part of the 31/2 % bond 2004 – 2010 in an amount of CHF 18 million was bought back before maturity date.
Regarding bonds see also note 19.
15 Deferred tax assets and liabilities
Deferred tax assets and liabilities relate to the following balance sheet items:
million CHF
Investment properties
Property, plant and equipment for own use
Intangible assets
Tax loss carryforwards
Inventories
Provisions
Other interest-bearing liabilities
Other non-interest-bearing liabilities
Other balance sheet items
Total
Offsetting
Deferred tax assets / liabilities
Tax
assets
Tax
liabilities
2009
net
2008
net
6
34
17
6
32
14
–27
7
–5
–21
11
17
5
32
14
–19
13
–1
–1
–19
8
32
17
32
2
3
27
5
11
1
24
2
75
12
6
1
3
13
92
–19
56
–19
73
In compliance with the exception of IAS 12 revised, no deferred taxes are recognized on investments in subsidiaries. Deferred taxes on
temporary differences are calculated on a gross basis and accounted for net at subsidiary level, which results in an offset of CHF 19 million
(previous year: CHF 23 million).
Georg Fischer 79
Total 2008
153
96
–51
–44
–1
63
16
16
35
23
153
119
77
–52
–10
27
–8
153
thereof current
thereof non-current
25
38
12
4
1
15
31
4
8
15
77
76
77
76
For comparative purposes, the restructuring provisions have been separated from the other provisions of the previous year.
Provisions are classified as follows: Warranties on serial products (machines, consumables, etc.), onerous contracts (when costs of meeting
the contractual obligations exceed the expected economic benefits), legal cases, restructuring provisions (constructive and contractual
obligations to third parties, which have been communicated) and other provisions.
About 40 % of the warranty provisions (CHF 25 million) result from indemnity claims addressed to various companies of GF Automotive. The
warranty provisions carried under GF Piping Systems amount to CHF 19 million and have been reduced by one third compared to previous
year (previous year: CHF 29 million). The major part thereof (CHF 16 million) covers provisions for risks recognized in the consolidated
figures as a result of the purchase of the JRG Gunzenhauser AG in 2008, of which CHF 8 million could be released in the current year.
The category onerous contracts contains a provision in the gross amount of CHF 3 million, which is discounted over a remaining period of
8 years with an interest rate of 9 % and shown at its present value of CHF 2.1 million. The non-current provisions are anticipated to result
in a cash outflow within 2 – 3 years. Due to this maturity structure all provisions but the one mentioned above are not discounted.
Provisions built under the category legal cases can be split in several individual cases of the various Corporate Groups, with an impact of
less than CHF 5 million per case.
The restructuring provisions in the amount of CHF 35 million (previous year: CHF 6 million) cover constructive and contractual obligations to
third parties, which are based on a detailed and formal restructuring plan. The features of the plan have been communicated in a manner
that raised a valid expectation in the stakeholders (employees, customers, suppliers, etc.) that the restructuring plan will be carried out. The
major part of the remaining restructuring provision as per balance sheet date will require the use of cash or cash equivalents in 2010.
The category other provisions contains provisions related to employee engagements as well as to environmental and similar obligations.
Investor information
Total 2009
20
8
–3
–2
Consolidated financial statements
Other provisions
6
52
–11
–12
Financial statements Georg Fischer Ltd
Restructuring
provisions
25
2
–2
–9
Affiliated companies
Legal cases
24
6
–10
–3
–1
Warranties
78
28
–25
–18
million CHF
As per 1 January
Increase
Use
Release
Changes in scope of consolidation
Translation adjustment
As per 31 December
Onerous contracts
16 Movements of provisions
80 Georg Fischer
CONSOLIDATED FINANCIAL STATEMENTS
17 Employee benefits
The overall situation of employee benefits in the Corporation is as follows.
Plan assets and defined benefit obligations as of closing date:
million CHF
Fair value of plan assets as per 1 January
(+) Expected return on plan assets
(+) Employer contributions
(+) Employees’ contributions
(–) Benefits paid
Actuarial (+) gains / (–) losses, net
(–) Effect from plan settlements, curtailments
(+/–) Changes in scope of consolidation
(+/–) Translation adjustment
Fair value of plan assets as per 31 December
Present value of defined benefit obligations
as per 1 January
(–) Current service cost, net of
employees’ contributions
(–) Current service cost for length of service
(–) Employees’ contributions
(+/–) Past service cost
(–) Interest cost
Actuarial (+) gains / (–) losses, net
(+) Benefits paid
(+) Effect from plan settlements, curtailments
(+/–) Changes in scope of consolidation
(+/–) Translation adjustment
Present value of defined benefit obligations
as per 31 December
Pension liability (–) / asset (+), total
2009
Total
Funded
plans
1 181
51
23
15
–72
81
–39
1 181
51
23
15
–72
81
–39
1 341
61
22
14
–77
–254
1 341
61
22
14
–77
–254
5
1 245
5
1 245
101
–27
1 181
101
–27
1 181
Funded
plans
Unfunded
plans
Unfunded
plans
2008
Total
–1 219
–183
–1 402
–1 218
–226
–1 444
–19
–5
–3
–21
–4
–3
–25
–3
–14
–43
54
77
1
–81
26
–10
20
16
1
2
21
–53
74
93
2
–79
47
–4
3
1
–24
–3
–15
4
–56
–52
88
48
3
–3
–1 216
–196
–1 412
–1 219
–183
–1 402
29
–196
–167
–38
–183
–221
–15
4
–47
–36
72
48
–9
–16
16
–14
Funded
plans
Unfunded
plans
2009
Total
Funded
plans
Unfunded
plans
2008
Total
29
–196
–167
–38
–183
–221
Unrecognized cumulative actuarial gains (–) /
losses (+), net
Past service cost, not recognized
Effects from asset ceiling of defined benefit plans
–9
4
–35
7
–1
–2
3
–35
30
–10
20
Recognized pension liability (–) / asset (+)
as per 31 December
–11
–190
–201
–8
–193
–201
Recognized on the statement of financial position
as follows:
Other financial assets
Liabilities for employee benefits:
Current loans payable
Non-current loans payable
Other non-current employee benefit obligations
Recognized pension liability (–) / asset (+)
as per 31 December
1
1
–42
–42
–1
–42
–43
–12
–148
–160
–7
–151
–158
–11
–190
–201
–8
–193
–201
–8
–22
23
2
-1
–5
–193
–14
–201
–36
23
16
2
–5
–4
–22
22
–216
–16
–4
16
2
21
–220
–38
22
16
2
17
–11
–190
–201
–8
–193
–201
Movements of recognized pension liability (–) /
asset (+)
Recognized pension liability (–) / asset (+)
as per 1 January
(–) Cost of defined benefit plans
(+) Employer contributions
(+) Benefits paid
(+/–) Changes in scope of consolidation
(+/–) Translation adjustment and other effects
Recognized pension liability (–) / asset (+)
as per 31 December
14
3
Based on the present value of defined benefit obligations of CHF 1,412 million and the fair value of plan assets of CHF 1,245 million the
Corporation‘s defined benefit plans report a total net pension liability of CHF 167 million. This liability is composed of defined benefit obligations in the amount of CHF 196 million related to unfunded plans – mainly in Germany and Austria – and plan assets of CHF 29 million –
mainly from Swiss pension plans. Considering the recognized pension liability in the amount of CHF 201 million, the total unrecognized
actuarial gain amounts to net CHF 34 million. In the previous year an unrecognized actuarial loss in the amount of CHF 20 million was
disclosed. Compared to previous year, the changes are mainly originated by higher fair values of plan assets.
For next year the expected current service cost for defined benefit plans will amount to CHF 24 million.
Consolidated financial statements
Pension liability (–) / asset (+), total
Financial statements Georg Fischer Ltd
million CHF
Investor information
Georg Fischer 81
Affiliated companies
The Swiss pension plans are included in the IAS 19 calculation of defined benefit plans. According to Swiss law they qualify as defined
contribution plans. These plans are legally independent foundations for which the Corporation is not liable.
82 Georg Fischer
CONSOLIDATED FINANCIAL STATEMENTS
Analysis of employee benefit costs:
million CHF
Cost of defined benefit plans
(+) Current service cost for defined benefit plans net of employees‘ contributions
(+) Past service cost
(+) Interest cost
(–) Expected return on plan assets1
(+/–) Actuarial loss recognized
(+/–) Effects from early retirements, curtailments, settlements
(+) Adjustment for limit on net asset (IFRIC 14)
Cost of defined benefit plans, net
2009
2008
24
5
56
–51
–2
–1
2
33
24
53
–61
–1
20
35
Cost of plans for length of service
3
3
Cost of defined contribution plans
3
4
39
42
2009
2008
3.8
3.9
2.2
0.6
4.1
4.3
2.1
0.6
Employee benefit costs
1 In the year under review the average actual return on plan assets equals 10.6 % (previous year: –16.4 %).
Actuarial assumptions:
in %
Discount rate
Expected return on plan assets
Expected salary increase rate
Expected pension increase rate
The actuarial assumptions are determined at the end of the particular fiscal year. The actuarial assumptions disclosed under the respective fiscal year will be applied to determine the liabilities at year-end and the cost of defined benefit plans of the following year. The
expected return on plan assets is based on long-term historical performance of the asset categories of each defined pension plan with
funded status.
The expected return on plan assets is based on long-term historical performance of the asset categories of each defined funded plan.
Funding of defined benefit obligations and effect of experience adjustments:
million CHF
Fair value of plan assets
Present value of defined benefit obligations
Pension liability (–) / asset (+)
2009
2008
2007
2006
1 245
–1 412
–167
1 181
–1 402
–221
1 341
–1 444
–103
1 319
–1 493
–174
81
21
–254
9
1
–12
46
–27
Long-term target
2009
2008
20–35
30–50
10–30
0–20
25
40
23
12
100
22
41
23
14
100
Difference between expected and actual return on plan assets
Actuarial adjustments on plan liabilities
The weighted average asset allocation of funded defined benefit plans as per 31 December 2009 and 2008:
in %
Equity securities
Debt securities
Real estate
Other financial assets
Total
The plan assets with funded status do not include own shares and real estate used by Georg Fischer.
Healthcare costs:
There are no liabilities for healthcare payments after the termination of employment.
Georg Fischer 83
million CHF
Social security
Overtime, holiday, bonuses and profit-sharing
Other non-interest-bearing liabilities
Other interest-bearing liabilities
Accrued expenses and deferred income
Total
2009
2008
16
57
42
4
93
212
20
81
44
4
111
260
19 Interest-bearing liabilities
Investor information
18 Other current liabilities
In the year under review net debt, which is calculated as the difference between the interest-bearing liabilities and cash, cash equivalents
and marketable securities, fell from CHF 546 million to CHF 472 million. The negative impact of the loss and of the par value repayment
made in June was offset by a reduction of CHF 245 million in net working capital.
164
113
14
297
157
42
4
367
1
425
Maturity
over
5 years
2009
2008
1
1
277
14
454
42
6
793
345
27
374
43
7
796
The effective interest rate of liabilities to banks is 4.0 % (previous year: 4.3 %). The new syndicated loan has not had any effect on this
interest rate since it has not yet been drawn down. In view of the situation on the credit markets in general and the earnings situation
of Georg Fischer, the margins for the newly agreed loans are considerably higher.
Georg Fischer has the following syndicated loan:
Debtors
Georg Fischer Ltd / Georg Fischer Finanz AG
Term
Credit
thereof utilized
2009 – 2013
CHF 420 million
CHF 0 million
In view of the earnings situation and the structural programme initiated in response, renegotiation of the terms of the syndicated loan
seemed advisable in order to secure financing over the entire restructuring phase. In October 2009, Georg Fischer signed a new loan
agreement with a bank syndicate. The new agreement includes bilateral credit lines as well as the existing syndicated loan. This brought
the total volume to CHF 420 million. The syndicated loan falls due on 30 June 2013. By 31 December 2009, it had not been drawn down.
Besides other terms the loan contains covenants with respect to net debt ratio (ratio of net debt to EBITDA), interest-coverage ratio (ratio of
net interest expense to EBITDA) and gearing ratio (ratio of net debt to equity). Since, according to the structural programme plan, earnings
are expected to be weak in 2010, the net debt ratio and interest-coverage ratio have been replaced until 30 September 2010 by a minimum
EBITDA, which takes into account the performance of the plan figures. After this date, the covenants come into effect. Beyond this, additional
terms which are in common practice for syndicated loans, are effective.
The bonds placed in the market are subject to the usual cross-default clauses: the outstanding amounts move into default if the premature repayment of another financial obligation is demanded of the company or one of its major subsidiaries owing to failure to meet
the credit terms. As per balance sheet date the effective credit terms have been met.
On 5 February 2009, the 3½ % bond 1999 – 2009 was repaid. Repayment was effected by drawing down the syndicated loan, largely unused
until then, since refinancing on the capital markets was not possible at that time. Owing to improved market conditions, Georg Fischer was
able to issue a CHF 300 million 4½ % bond 2009 – 2014 towards the end of August. This transaction has substantially improved the maturity
profile.
On 15 September 2010 the 3½ % bond 2004 – 2010 at a par value of CHF 175 million falls due for repayment. In November 2009,
CHF 18 million was repurchased in the market. Hence at year-end, CHF 157 million was outstanding.
The interest-bearing liabilities also include loans to German employee benefit plans amounting to CHF 42 million (previous year:
CHF 43 million).
Financial statements Georg Fischer Ltd
Bank liabilities (at fixed interest rates)
Bank liabilities (at variable interest rates)
Bonds (at fixed interest rates)
Employee benefit liabilities (loans)
Other interest-bearing liabilities
Total
up to
5 years
Affiliated companies
million CHF
within
1 year
Consolidated financial statements
Interest-bearing liabilities consist of the following items:
84 Georg Fischer
CONSOLIDATED FINANCIAL STATEMENTS
20 Contingencies
Contingencies amount to CHF 13 million (previous year: CHF 16 million) and include obligations to take back equipment leased to customers totalling CHF 10 million (previous year: CHF 11 million), as well as guarantees and securities granted to third parties of CHF 3 million
(previous year: CHF 5 million).
21 Risk management
Enterprise Risk Management as a fully integrated risk management process was systematically applied in 2009 on all levels of the
Corporation. The three Corporate Groups, the Corporate Management and, for the first time, all important corporate subsidiaries semiannually prepared a risk map elaborating on the most important 25 to 30 risks with regard to the categories markets, processes, manV\ZbZciVcYgZhdjgXZh!VhlZaaVh[^cVcX^Vah#Dci]ZaZkZad[i]Z8dgedgViZ<gdjehVcY8dgedgViZBVcV\ZbZci!ÆhigViZ\^Xg^h`hÇlVh
introduced as a new risk category. Along the lines of the other risk categories, the most important strategic risks had to be defined and
evaluated and measurements to be determined. The structure of the likelihood was classified into four categories. Whenever possible
and suitable, the risks listed were quantified taking into consideration already planned and executed measurements. Alternatively, a
qualification of the risk exposure was applied.
Since 2009 a Risk Council, consisting of representatives of the Corporate Groups and the Corporate Management and headed by the
Chief Risk Officer is responsible for the coordination of all activities in the area of Enterprise Risk Management, the analysis of the risk
maps, and the ongoing systematization of the risk process. The Risk Council met four times during the reporting year.
During the year under review, the risk maps were presented to and discussed by the Executive Committee (twice) and the Board of
Directors (once). A stepwise procedure was implemented, leading to workshops on the levels of Corporate Group Management, Executive
Committee and Board of Directors.
The following were identified as main risks: The execution of the structural programme, the cyclicity of various businesses of the three
Corporate Groups and the recall risk due to insufficient product quality.
Clear measures in order to reduce the risk exposure of the above mentioned as well as other identified risks were defined and are in the
process of execution. They are in line with strategic targets of the three Corporate Groups and the Corporation.
Georg Fischer 85
22 Financial risk management
The risk management principles are geared to identifying and analyzing the risks to which the Corporation is exposed and to establishing
the appropriate control mechanisms. The principles of risk management and the processes applied are regularly reviewed, taking
due regard of changes in the market and in the Corporation‘s activities. The ultimate goal is to develop controls, based on the existing
training and management guidelines and processes, that ensure a disciplined and conscious approach to risks. The Audit Committee is
supported by the Head of Finance and Controlling to do this task.
Owing to its business activities, Georg Fischer is exposed to various financial risks such as credit risk, market risk (including currency,
interest rate and price risk) and liquidity risk.
Investor information
The Board of Directors bears ultimate responsibility for the financial risk management. The Board has tasked the Audit Committee
with monitoring the development and implementation of the risk management principles. The Audit Committee reports regularly to the
Board on the current status.
Transactions involving derivative financial instruments are also entered into only with important financial institutions with at least a
single A rating. The purpose of such transactions is to hedge against currency risks for the Corporation.
The danger of cluster risks on trade accounts receivable is limited due to the large number and wide geographical spread of customers.
The extent of the credit risk is determined mainly by the individual characteristics of each customer. Assessment of this risk involves a
review of the customer‘s credit-worthiness based on his financial situation and past experience. In monitoring default risk, customers
are classified according to relevant factors such as geographical location, sector and past financial difficulties.
The maximum credit risk on financial instruments corresponds to the carrying amounts of the relevant financial assets. Georg Fischer
has not entered into appreciable guarantees or similar obligations that would increase the risk over and above the carrying amounts.
The maximum credit risk as per balance sheet date was as follows:
million CHF
Cash and cash equivalents
Other accounts receivable1
Trade accounts receivable
Other financial assets2
Total
2009
2008
316
38
431
5
790
233
55
566
4
858
1 Without tax credits.
2 Relates to loans to third parties and security deposits.
Market risk
Market risk is the risk that changes in market rates and prices, e.g. exchange rates, interest rates or share prices, may have an impact
on the profit and market value of financial instruments held by Georg Fischer. The aim of managing such market risks is to monitor and
control these risks in order to ensure that they do not exceed a defined limit.
Currency risk
Owing to its international activities, Georg Fischer is exposed to currency risks. These financial risks occur in connection with transactions (in particular the purchase and sale of goods) which are effected in currencies different from the functional currency of the
company in question. Such transactions are effected mainly in Swiss francs, euros and US dollars.
8jggZcXn g^h`h XVc WZ gZYjXZY Wn ejgX]Vh^c\ VcY egdYjX^c\ \ddYh ^c i]Z [jcXi^dcVa XjggZcXn ×Xdc\gjZcXnÆ gjaZ# >c hdbZ XVhZh!
US dollars or euros are hedged for a maximum of twelve months by means of currency futures.
Financial statements Georg Fischer Ltd
Georg Fischer invests its cash worldwide and predominantly as deposits in leading Swiss and German banks with at least a single A
rating. In accordance with the investment policy of Georg Fischer, these transactions are entered into only with credit-worthy commercial institutions. As a general rule, the investments have a maturity of less than three months. Besides, subsidiaries hold current bank
accounts.
Affiliated companies
Credit risk
The credit risk is the risk of suffering financial loss if a customer or counterparty of a financial instrument fails to meet its contractual
obligations. At Georg Fischer the main credit risks arise from trade accounts receivable and bank deposits.
Consolidated financial statements
The following sections provide an overview of the extent of the individual risks and the goals, principles and processes employed for
measuring, monitoring and hedging the financial risks.
86 Georg Fischer
CONSOLIDATED FINANCIAL STATEMENTS
The next table shows the currency risks arising from financial instruments at the balance sheet date in which the currency involved is
not congruent with the functional currency of the subsidiary which holds these financial instruments.
million CHF
EUR
USD
CNY
21
127
3
36
54
13
26
7
25
12
5
Loans from subsidiaries
Bank liabilities (non-current)
Other non-current liabilities
Bank liabilities (current)
Trade accounts payable
Accounts payable to subsidiaries
Other current liabilities
47
3
6
7
2
38
29
6
4
23
1
1
1
1
2
Foreign currency forward rate contracts
Total currency exposure
6
11
120
11
10
Loans to subsidiaries (without equity-like
corporate loans)
Other financial assets
Trade accounts receivable
Accounts receivable from subsidiaries
Other accounts receivable
Cash and cash equivalents
2009
CHF
3
2
26
–25
EUR
USD
CNY
22
129
2
54
94
2
21
22
34
6
14
1
55
10
7
1
4
65
62
11
6
6
37
2
2
12
–16
203
–72
6
2008
CHF
1
1
1
19
–20
A 10 % change in exchange rates at 31 December 2009 would have increased or decreased net income by the amounts listed below. The
assumption underlying this analysis is that all other variables, in particular interest rates, remain unchanged. Substantially larger effects
on the income statement can be caused by exchange rate changes related to current business transactions (transaction exposure), which
do not lie in the scope of application of IFRS 7.
Sensitivity analysis 2009
million CHF
Change +/–
CHF/CNY
10%
CHF/USD
10 %
CHF/EUR
10 %
CNY/USD
10%
CNY/EUR
10 %
USD/EUR
10 %
1.3
–1.3
1.9
–1.9
3.3
–3.3
0.6
–0.6
2.0
–2.0
0.1
–0.1
Positive impact on income statement
Negative impact on income statement
A 1 % currency fluctuation of the Swiss franc against the invested equities in euro, US dollar or Chinese renminbi as per 31 December
2009 would have increased or decreased the Corporation‘s equity by CHF 9 million. Equity-like corporate loans to subsidiaries are included for the sensitivity analysis of the equity. The assumption underlying this analysis is that all other variables, in particular interest
rates, remain unchanged.
The table below shows the contract values and market values of the currency futures as per the balance sheet date:
Foreign currency forward rate contracts:
million CHF
Contract value
Fair value1
Market value
1 Corresponds to the carrying amount recognized.
2009
2008
142
2
144
245
14
259
Georg Fischer 87
6
120
12
203
18
13
13
259
13
5
144
Interest rate risk
The interest rate risk may involve either changes in future interest payments owing to fluctuations in market interest rates or the risk
of a change in market value, i.e. the risk that the market value of a financial instrument will change owing to fluctuations in market
interest rates.
Market value sensitivity analysis for interest-bearing financial instruments with a fixed interest rate:
Market value fluctuations of fixed-interest financial instruments are not recognized in the Corporation‘s income statement. Hedge
accounting as defined by IAS 39 was not applied. Therefore, a change in interest rates would not have any effect on the income statement.
Cash flow sensitivity analysis for financial instruments with variable interest rates:
A one percentage point increase in interest rates would have reduced net income by CHF 2.5 million (previous year: CHF 3.3 million).
A reduction in the interest rate by the same percentage would have increased net income by the same amount. The underlying assumption for this analysis is that all other variables remain unchanged.
Price risk
The securities held for trading of CHF 3 million are exposed to price risks (on the stock market). Since the value of the securities held
for trading is modest, there is no great sensitivity to changes in share prices. The shares held are those of Swiss blue chip companies.
Liquidity risk
The liquidity risk is the risk that Georg Fischer is unable to meet its obligations when they fall due.
Liquidity is constantly monitored to ensure that it is adequate. Liquidity reserves are held in order to offset the usual fluctuations in
requirements. At the same time, the Corporation has unused credit lines in case more serious fluctuations occur. The total amount of
unused credit lines as per 31 December 2009 was CHF 633 million. The credit lines are spread over several banks so that there is no
excessive dependence on any one institution.
The following tables show the contractual maturities (including interest rates) of the financial liabilities held by Georg Fischer at the end
of the reporting period and in the previous year:
million CHF
2009
Trade accounts payable
Other current / non-current liabilities
Bonds
Banks
Total
million CHF
2008
Trade accounts payable
Other current / non-current liabilities
Bonds
Banks
Total
Carrying
amount
Contractual
cash flows
up to
6 month
6 to 12
month
274
229
454
291
1 248
274
229
530
314
1 347
274
212
102
588
176
72
248
Carrying
amount
Contractual
cash flows
up to
6 month
6 to 12
month
388
276
374
372
1 410
388
276
394
393
1 451
388
260
207
229
1 084
6
44
50
1 to 5 more than
years
5 years
13
354
140
507
4
4
1 to 5 more than
years
5 years
10
181
99
290
Consolidated financial statements
2008
Financial statements Georg Fischer Ltd
EUR
USD
CAD
JPY
Others
Total
2009
6
21
27
Affiliated companies
million CHF
Investor information
Foreign currency forward rate contracts by currencies:
88 Georg Fischer
CONSOLIDATED FINANCIAL STATEMENTS
23 Capital management
The capital managed by the Corporation consists of the consolidated equity. The Corporation has set the following goals for the management of its capital:
– maintaining a healthy and sound structure of the statement of financial position based on continuing values;
– ensuring the necessary financial scope in order to be able to make investments and acquisitions in the future;
– achieving a return for investors that is appropriate for the risk.
The Corporation employs two ratios to monitor equity: the equity ratio and the return on equity. The equity ratio equates to equity as
a percentage of total assets. Return on equity is obtained by measuring net profit as a percentage of average equity. These ratios are
reported to the Executive Committee and the Board of Directors at regular intervals by internal financial reporting. The equity ratio as
per 31 December 2009 was at 40 %. As an industrial group, Georg Fischer strives to have a strong statement of financial position with
a high portion of equity. In the medium term, the Corporation aims for a slightly lower equity ratio of 35 % to 40 % for tax reasons. The
medium term target for return on equity is between 16 % and 18 %.
The ratios are shown in the table below:
million CHF
2009
2008
Equity attributable to shareholders of Georg Fischer Ltd
Non-controlling interests
Equity
1 107
45
1 152
1 356
48
1 404
Total assets
Equity ratio in %
2 866
40 %
3 291
43 %
Average equity
Net profit / (loss)
Return on equity in %
1 278
–238
–19 %
1 472
69
5%
The Corporation does not have any financial covenants with minimal capital requirements.
The Board of Directors proposes the appropriation of retained earnings to the General Meeting. Georg Fischer pursues a result-oriented
dividend policy and distributes about one third of the Corporation’s consolidated net income to shareholders. This may be distributed either
as a dividend or as a reduction in par value. The Board of Directors is proposing to the General Meeting no pay-out of a dividend or par value
reduction for the 2009 fiscal year (previous year: CHF 5). The par value of the Georg Fischer registered share amounts to CHF 20.
24 Leases
million CHF
2009
Liabilities under leases up to 1 year
Liabilities under leases 2 to 5 years
Liabilities under leases over 5 years
Finance leases (nominal values)
1
Liabilities under leases up to 1 year
Liabilities under leases 2 to 5 years
Liabilities under leases over 5 years
Operating leases (nominal values)
9
24
21
54
2008
1
11
23
18
52
25 Pledged assets
Assets pledged or restricted on title in part or whole amount to CHF 52 million (previous year: CHF 63 million), of which CHF 20 million
relate to property, plant and equipment (previous year: CHF 27 million) and CHF 32 million to accounts receivable (previous year: CHF 36
million).
The assets are pledged or restricted on title to secure bank loans.
Georg Fischer 89
million CHF
2009
2008
8
8
9
7
–5
17
14
11
2
–3
38
27
106
Sales of material, waste and scrap
Income from insurance contracts
Income from services
Gains on disposal of assets
Foreign exchange gains / losses
Gains on acquisitions / divestitures
Remaining other operating income
Total
24
51
Investor information
26 Other operating income
;dgi]ZegZk^djhnZVgi]Za^cZÆ<V^chdcVXfj^h^i^dch$Y^kZhi^ijgZhÇ^cXajYZhi]Z\V^cdci]ZY^kZhi^ijgZd[<Zdg\;^hX]ZgKZg`Z]ghiZX]c^`
GmbH, Singen in the amount of CHF 35 million.
million CHF
2009
2008
148
46
90
105
72
74
18
553
250
50
111
164
109
106
50
840
2009
2008
709
39
145
893
898
42
163
1 103
External services1
Rent, leases
Utility services third parties
Selling costs, commissions
Advertisements, communication
Repair, maintenance
Other expenses
Total
Consolidated financial statements
27 Operating expenses
28 Personnel expenses
million CHF
Salaries and wages
Employee benefits
Social security
Total
According to a plan established by the Board of Directors, a fixed number of registered shares of Georg Fischer Ltd is distributed to the
members of the Executive Committee and the members of senior management as a long-term incentive. For the year under review 3,967
shares (previous year: 4,284) were issued and recognized as personnel expenses at their market value of CHF 1.0 million (previous year:
CHF 1.1 million).
Affiliated companies
The total research and development expenses for 2009 amount to CHF 116 million (previous year: CHF 143 million).
Financial statements Georg Fischer Ltd
1 External services include e.g. temporary employees, IT costs, R&D, insurance costs as well as consulting.
90 Georg Fischer
CONSOLIDATED FINANCIAL STATEMENTS
29 Special charges
The global market crisis has influenced the development of the earnings situation of the Corporation. Therefore Georg Fischer launched
a broad-based structural programme in the first half of 2009 in order to sustainably reduce the Corporation’s overall costs by CHF 350
million by 2012. The goal is to post an operating profit in 2010, to generate an EBIT margin of 8 % and to decrease net debt to below
CHF 400 million by 2012 at the latest. These results are facing planned one-off charges in the amount of CHF 100 million, CHF 70 million
thereof involve the use of cash and cash equivalents.
Georg Fischer takes a special charge of CHF 90 million to the 2009 accounts. In addition, the impairment tests showed that the value
of some goodwill positions is not supported anymore. Consequently impairment charges of CHF 53 million on the goodwill positions
as disclosed in note 4 needed to be recognized in the income statement. For a better comparability the special charges of the previous
year as well as the impairment charges on goodwill and other non-current asset positions of 2008 are displayed separately. The special
charges of 2009 and 2008 are composed as stated below:
million CHF
2009
Impairment on non-current and current assets
Personnel and social expenses
Structural adjustments
Loss on the divestiture of Georg Fischer GmbH & Co KG, Gleisdorf
Restructuring expenses
17
43
15
15
90
Impairment on goodwill
Impairment on property, plant and equipment
Total special charges
53
143
2008
5
5
10
32
51
93
The personnel and social expenses refer mainly to the cost of social plans, concerning the concentration and dislocation of production
sites as well as the adjustment of structures and production capacities in Switzerland, Austria, Italy and Canada. The line structural adjustments includes costs for relocation, building up and clearance costs referring to the concentration of production capacities. The divestiture
loss related to the disposal of the Gleisdorf plant in the first half of 2009 adds up to CHF 15 million.
As disclosed in note 16, CHF 35 million of the special charges are allocated to restructuring provisions as per 31 December 2009
(previous year: CHF 6 million). In the year under review, cash effective expenses amounted to CHF 34 million. The cash out for the bulk
of the remaining restructuring provision as of 31 December 2009 is expected for the year 2010.
Due to an actual assessment of the situation no material special charges referring to the launched structural programme are expected
for the following years.
The implementation of the structural programme will bring about a corporate-wide reduction in payroll of 2,300 positions or 16 %
compared to year-end 2008. Some 1,845 positions were cut in 2009 already.
Georg Fischer 91
million CHF
Interest income
Net gains on financial instruments at fair value through profit or loss
Net gains on financial instruments available for sale
Financial income
Addition of accrued interest of bonds
Other interest expenses
Net losses on financial instruments at fair value through profit or loss
Net losses on financial instruments available for sale
Other financial expenses
Financial expenses
2009
2008
2
5
2
5
1
34
2
1
36
5
5
42
1
43
Investor information
30 Financial result
Net losses on financial instruments at fair value through profit or loss include foreign exchange losses in the amount of CHF 2 million.
Income tax expenses can be analyzed as follows:
million CHF
Tax rate
reconciliation
Profit / (loss) before taxes
Tax expenses (+) / income (–) at the applicable tax rate
of 32% (previous year: 8%)1
Non-deductible expenses / tax exempted income
Use of unrecognized tax loss carryforwards
Effect of unrecognized tax loss carryforwards arising
from current results
Depreciation of recognized tax loss carryforwards
Tax charges and credits relating to prior periods, net
Effect of change in tax rates
Other effects
Income tax expenses recognized
Effective tax rate
thereof
current taxes
2009
thereof
deferred taxes
–236
2008
96
–75
9
–2
–53
–5
–2
–22
14
8
1
–5
69
1
–1
2
–1
2
78
–9
1
22
n/a
–1
1
1
19
1
–2
–17
1
27
28%
1 Due to the fact that in previous year losses incurred predominantly in countries with higher tax rates and profits predominantly were made in countries
with lower tax rates a relatively low overall applicable tax rate of 8% resulted in 2008.
Financial statements Georg Fischer Ltd
31 Income taxes
Consolidated financial statements
Other financial expenses include arrangement fees of CHF 3 million and commitment fees of CHF 2 million related to syndicated loans.
Affiliated companies
The tax expenses of previous year consisted of CHF 36 million current tax expenses and CHF 9 million deferred tax income. The potential
tax effect of dividends and other profit distributions varies from country to country and can not be reliably determined.
92 Georg Fischer
CONSOLIDATED FINANCIAL STATEMENTS
The following unrecognized tax loss carryforwards are at the disposal of the Corporation:
million CHF
2009
2008
242
300
5
4
2
Expiry unlimited
after 2012
2012
2011
2010
2009
Total unrecognized tax loss carryforwards
553
137
73
6
1
2
7
226
Potential tax relief effect
128
64
The recognition of tax loss carryforwards is assessed on an annual basis and is based on current assumptions and estimates of the
management. Tax loss carryforwards are recognized only to the extent that, within the next two to three years sufficient taxable profit
is expected to be available to allow the deferred tax asset to be utilized. In countries or subsidiaries where such utilization is not probable,
tax loss carryforwards are not recognized. The potential tax relief effect from the unrecognized tax loss carryforwards amounts to
CHF 128 million.
As per 31 December 2009, based on the above mentioned estimates, tax loss carryforwards of CHF 97 million were activated resulting
in a deferred tax asset of CHF 27 million (previous year: CHF 19 million). Country-specific, tax-relevant regulations and opportunities
were hereby respected.
32 Earnings / (loss) per share
The loss per share in the amount of CHF 61 (previous year: earnings CHF 14) is calculated by dividing the portion of net profit attributable to Georg Fischer Ltd shareholders by the weighted average number of shares outstanding during the year under review (number
of shares issued less number of own shares). The weighted average number of shares amounted to 4,056,140 in 2009 (previous year:
4,021,881).
There has been no dilution of earnings / (loss) per share in both, the year under review and the previous year.
33 Related parties
Related parties include members of the Executive Committee, the Board of Directors, employee benefit plans or important shareholders,
as well as companies under their control. Transactions with related parties are generally conducted at arm‘s length.
The members of the Board of Directors are compensated with a fixed number of Georg Fischer registered shares and with a cash compensation, which, at their discretion, can also be settled with Georg Fischer registered shares. For special functions (e.g. Chairman,
Vice-Chairman, Committee member, extraordinary meetings) an additional compensation, according to the time needed, is granted in
the form of cash or Georg Fischer Ltd registered shares.
The members of the Board of Directors received in the year under review 2,255 registered shares of Georg Fischer (par value CHF 20) with
a market value of CHF 0.6 million (previous year: 3,666 registered shares with a market value of CHF 0.9 million). Additionally members
of the Board of Directors received a cash compensation and other benefits of CHF 0.5 million (previous year: CHF 0.4 million). The total
compensation of the Board of Directors is included in the operating expenses.
The members of the Executive Committee received 1,300 registered shares of Georg Fischer (par value CHF 20) with a market value
of CHF 0.3 million (previous year: 1,344 registered shares, market value CHF 0.4 million) for the year under review. Additionally the
members of the Executive Committee received a cash compensation as well as social security and pension plan contributions of
CHF 4.7 million (previous year: CHF 5.3 million) for the year under review. The total compensation of the Executive Committee is included
in the personnel expenses (see note 28).
Apart from compensations to the Board of Directors and the Executive Committee and the ordinary contributions to the various employee
benefit plans, there have been no material transactions with related parties.
Georg Fischer 93
1 000 CHF
2009
2008
Compensation
Employee benefit contributions
Social security
Share based compensation
Other long-term benefits
4 559
776
258
602
5 201
827
293
635
Total compensation
6 195
6 956
Additional fees and remuneration. No member of the Executive Committee or Board of Directors, or any person closely associated
with them, received in the fiscal year 2009 any fees or other payments for additional services to Georg Fischer Ltd or its corporate
subsidiaries.
Investor information
Break down of the total compensation of the Board of Directors and the Executive Committee to the various expense categories:
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
100
100
100
100
100
100
100
100
100
ARS
AUD
BRL
CAD
CNY
EUR
GBP
HKD
INR
MXN
MYR
NZD
SGD
TRY
USD
CZK
DKK
JPY
KRW
NOK
PLN
SEK
THB
TWD
2009
Average
rates
2008
2009
Spot
rates
2008
0.292
0.856
0.548
0.954
0.159
1.510
1.695
0.140
0.023
0.081
0.308
0.687
0.747
0.700
1.087
5.718
20.278
1.162
0.085
17.297
34.970
14.247
3.171
3.292
0.342
0.916
0.598
1.018
0.156
1.586
1.998
0.139
0.025
0.098
0.325
0.769
0.765
0.837
1.083
6.363
21.266
1.052
0.100
19.364
45.282
16.538
3.279
3.431
0.271
0.928
0.592
0.983
0.151
1.486
1.662
0.133
0.022
0.079
0.303
0.750
0.736
0.687
1.032
5.624
19.973
1.118
0.089
17.905
35.989
14.485
3.114
3.199
0.306
0.732
0.453
0.869
0.155
1.493
1.527
0.136
0.022
0.077
0.310
0.612
0.734
0.695
1.057
5.621
20.011
1.172
0.083
15.071
35.710
13.661
3.013
3.208
35 Events after the balance sheet date
The consolidated financial statements were approved and released for publication by the Board of Directors on 19 February 2010. They
must also be approved at the Annual General Meeting.
There have been no other events between 31 December 2009 and 19 February 2010 that would require an adjustment to the carrying
amounts of assets and liabilities or would need to be disclosed under this heading.
Financial statements Georg Fischer Ltd
34 Foreign exchange rates
Affiliated companies
The detailed disclosure of compensation and participation of the Executive Committee or the Board of Directors as per Swiss law can
be found in the financial statements of the Georg Fischer Ltd on pages 100 to 102.
Consolidated financial statements
Loans to members of governing bodies. Neither Georg Fischer Ltd nor its corporate subsidiaries have granted any guarantees, loans,
advances or credit facilities to members of the Executive Committee or the Board of Directors or to any person closely linked to them.
94 Georg Fischer
CONSOLIDATED FINANCIAL STATEMENTS
Report of the Statutory Auditor on the Consolidated Financial Statements to the General Meeting of Georg Fischer Ltd, Schaffhausen
As statutory auditor, we have audited the consolidated financial statements of Georg Fischer Ltd, Schaffhausen, which are
presented on pages 57 to 93 and comprise the consolidated statement of financial position, consolidated income statement, consolidated statement of comprehensive income, consolidated statement of changes in equity, consolidated statement of cash flows and
notes for the year ended 31 December 2009.
Board of Directors’ Responsibility
The Board of Directors is responsible for the preparation and fair presentation of the consolidated financial statements in accordance
with IFRS and the requirements of Swiss law. This responsibility includes designing, implementing and maintaining an internal control
system relevant to the preparation and fair presentation 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 Responsibility
Our 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 judgement, 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 purpose 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.
Opinion
In our opinion, the consolidated financial statements for the year ended 31 December 2009 give a true and fair view of the
financial position, the results of operations and the cash flows in accordance with IFRS and comply with Swiss law.
Report on Other Legal Requirements
We 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.
KPMG AG
Philipp Hallauer
Licensed Audit Expert
Auditor in Charge
Zurich, 19 February 2010
François Rouiller
Licensed Audit Expert
Statement of financial position
96
Income statement, statement of changes in equity
97
Notes to the financial statements
98
Investor information
Financial statements Georg Fischer Ltd
Report of the Statutory Auditor
104
Financial statements Georg Fischer Ltd
103
Affiliated companies
the appropriation of retained earnings 2009
Consolidated financial statements
Proposal by the Board of Directors for
96 Georg Fischer
FINANCIAL STATEMENTS GEORG FISCHER LTD
Statement of financial position as per 31 December 2009
1 000 CHF
Loans to subsidiaries
Investments
Non-current assets
Loans to subsidiaries
Other accounts receivable
Income taxes receivable
Prepaid expenses and accrued income
Own shares
Other marketable securities
Cash and cash equivalents
Current assets
Notes
2009
2008
(1)
322 360
838 172
1 160 532
200 000
975 122
1 175 122
56 567
313
9 073
214
2 950
14 784
83 901
443 970
552
5 838
8 309
12 702
2 851
31 505
507 727
1 244 433
1 680 849
82 018
312 202
261 853
102 522
329 694
244 362
425 992
–118 099
349 144
76 848
963 966
1 102 570
2 526
86 611
175 000
2 090
88 003
157 000
2 381
29 349
22
2 578
200 000
80 314
22 773
802
9 297
280 467
578 279
1 244 433
1 680 849
(3.6)
(2)
Assets
Share capital
Legal reserves
Special reserves
Retained earnings
Available earnings carried forward
Net loss / profit for the year
Equity
(3.1)
(3.2)
(3.3)
(3)
Non-current liabilities
Bonds
Loans from third parties
Provisions
Current liabilities
Bonds
Accounts payable to third parties
Accounts payable to subsidiaries and loans from subsidiaries
Tax liabilities
Accrued expenses and deferred income
Liabilities
Liabilities and equity
(4)
Georg Fischer 97
Ordinary income from investments
Extraordinary income from dividend in kind
Financial income
Income from services provided to subsidiaries
Other income
Income
2008
103 405
122 640
253 557
4 857
48 235
4 792
434 081
19 493
32 568
1 981
157 447
(6)
Ordinary expenses for investments
Extraordinary adjustment on investments
Extraordinary expense from dividend in kind
Financial expenses
Cost of services provided by subsidiaries
External expenses
Personnel expenses
Income taxes
Expenses
2009
289
240 000
(7)
Net loss / profit for the year
7 573
5 829
10 362
10 954
539
275 546
9 377
50 000
253 557
13 312
2 876
12 531
13 227
2 353
357 233
–118 099
76 848
Balance as per 31 December 2008
Net loss for the year
Reduction in par value
Reclassification
Rounding difference
Balance as per 31 December 2009
1 Legal reserves.
Special reserves
Retained earnings
Equity
205 045
310 455
26 350
237 251
349 144
1 128 245
76 848
76 848
–102 522
–102 522
–7 111
7 111
–1
102 522
–1
310 455
19 239
244 362
425 992
1 102 570
–118 099
–118 099
–20 504
–20 504
–17 492
82 018
310 455
1 747
17 492
–1
261 853
307 893
–1
963 966
Affiliated companies
Net profit for the year
Reduction in par value
Reclassification
Rounding difference
Reserves
for own shares1
Balance as per 31 December 2007
General reserves1
1 000 CHF
Share capital
Statement of changes in equity
for the year ended 31 December 2009
Consolidated financial statements
Notes
Financial statements Georg Fischer Ltd
1 000 CHF
Investor information
Income statement for the year ended 31 December 2009
98 Georg Fischer
FINANCIAL STATEMENTS GEORG FISCHER LTD
Notes to the financial statements
1
Non-current assets
Direct and indirect investments in subsidiaries, joint ventures and associates of Georg Fischer Ltd included the companies listed on
pages 106 to 109. They were valued at the lower of historical cost and market value. Compared to 2008, investments decreased by roughly
CHF 137 million due to the following:
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8]^cVjhi6jidbdi^kZEaVhi^Xh8dgeAiY!H]Vc\]V^0H]Vc\]V^<Zdg\;^hX]Zg8]^cVjhiEaVhi^Xh;^ii^c\h8dgeAiY!H]Vc\]V^0<Zdg\
;^hX]Zg6jidbdW^a\jhh6<!=Zgod\ZcWjg\08]Vc\o]dj6\^Z8]Vgb^aaZhBVX]^cZIdda8dAiY!8]Vc\o]dj0
™ ^cXdgedgVi^dcd[cZlXdgedgViZhjWh^Y^Vg^Zhdg_d^cikZcijgZh^ci]ZVbdjcid[8=;%#&b^aa^dc<Zdg\;^hX]Zg8dgnhAA8!9jWV^0
™ ^cXgZVhZd[^ckZhibZci^chjWh^Y^Vg^Zh^ci]ZVbdjcid[8=;%#&b^aa^dcHiZe"IZX6<!AjiZgWVX]0
™ ^cXgZVhZd[kVajZVY_jhibZcidc^ckZhibZcih^chjWh^Y^Vg^Zh^ci]ZVbdjcid[8=;')%b^aa^dc#
The increase of loans granted by Georg Fischer Ltd to corporate subsidiaries located in Switzerland by roughly CHF 122 million was mainly
caused by the reclassification of the loans from short-term to long-term due to extended maturities (see note 2). The financing policy of
the Corporation according to which the activities of subsidiaries are whenever possible and suitable financed by corporate loans instead
of local bank credit facilities, was retained during the year under review.
As of 31 December 2009, CHF 53.1 million of the loans to corporate subsidiaries were subordinated (previous year: none).
2
Current assets
Current assets decreased during the year under review by roughly CHF 420 million. The reduction mainly concerned short-term loans
granted to corporate subsidiaries and cash and cash equivalents. Short-term loans on the one side decreased due to the reclassification
of loans granted to corporate subsidiaries in Switzerland from short-term to long-term due to extended maturities (see note 1). On the
other side, Georg Fischer Finanz AG, a fully owned subsidiary of Georg Fischer Ltd, issued a bond which caused a reduced loan need of
Georg Fischer Finanz AG towards Georg Fischer Ltd.
The 50,000 registered shares which had been at the disposal of the Board of Directors were placed in the market during the year under review.
Taking into account the sale of additional own shares, total proceeds in the amount of CHF 16 million could be generated.
The income taxes receivable stands from prepayments of German income taxes for which Georg Fischer Ltd is liable (see note 7).
The securities were valued at 31 December 2009 at year-end stock market prices.
3
Equity
3.1 Share capital. The share capital decreased in comparison with 2008 due to the reduction of CHF 20,504,490 caused by the CHF 5
gZYjXi^dc ^c eVg kVajZ eZg gZ\^hiZgZY h]VgZ! l]^X] lVh YZX^YZY Wn i]Z <ZcZgVa BZZi^c\ d[ &- BVgX] '%%.# I]Z h]VgZ XVe^iVa Vh d[
31 December 2009 comprised 4,100,898 registered shares with a par value of CHF 20 each. Total dividend-bearing nominal capital
amounted to CHF 82,017,960.
3.2 Legal reserves. The decrease of legal reserves was due to the reduction of the reserve for own shares (see note 3.3).
3.3 Special reserves. Special reserves increased as a consequence of the reclassification of the reserve for own shares (see note 3.2).
3.4 Conditional capital. As of 31 December 2009 there was no conditional capital available (same as previous year).
3.5 Significant shareholders. According to a statement of BDS Beteiligungsgesellschaft AG, Buchberg, solely owned by Prof. Dr. Giorgio
Behr, it held 6.36 % of the voting rights as per 27 November 2008 in Georg Fischer Ltd. The package consists of 211,000 shares, equivalent
to 5.15 % of share capital, and 50,000 options, equivalent to 1.21 % of share capital.
6XXdgY^c\idVcVccdjcXZbZcid[J7H;jcYBVcV\ZbZciHl^ioZgaVcY6<!^i]ZaY(#%.d[i]Zh]VgZXVe^iVad[<Zdg\;^hX]ZgAiYVh
eZg'+?jcZ'%%.#
8gZY^iHj^hhZ6hhZihBVcV\ZbZci;jcYh6<VccdjcXZYi]Vi^i]ZaY(#+)d[i]Zh]VgZXVe^iVad[<Zdg\;^hX]ZgAiYVheZg&?jan'%%.#
On 27 October 2009 it reported that its share of the share capital had fallen below the 3 % threshold again.
Georg Fischer 99
Balance as per 1 January 2009
Purchases
Sales
Used for employee incentive programme and Board of Directors
KVajZVY_jhibZcih
Balance as per 31 December 2009, stated at fair market value
Number of
registered shares
Total
carrying amount
1 000 CHF
82 842
6 977
–75 465
–7 679
6 675
12 879
1 854
–15 766
–1 842
)+''
1 747
Thereof recognized by corporate subsidiaries
Thereof recognized by Georg Fischer Ltd
Liabilities
The decrease of non-current liabilities in comparison with the previous year was mainly caused by the reclassification of a bond in the
amount of CHF 175 million to current assets. The bond will be due in 2010. A part of this bond in the amount of CHF 18 million was bought
back in the current year on the market. As of 31 December 2009 CHF 157 million of this bond have been outstanding.
In addition to that, the 31/2 WdcY&...Ä'%%.^ci]ZVbdjcid[8=;'%%b^aa^dclVheV^YWVX`Yjg^c\i]ZnZVgjcYZggZk^Zl0VhVXdchZ"
quence, current liabilities decreased further.
On 15 September 2010 the 31/2 % bond 2004 – 2010 in the remaining par value of CHF 157 million will be due for repayment. The refinancing
is secured with existing, definitely confirmed credit facilities.
A breakdown of the bonds is disclosed in note 14 to the consolidated financial statements on page 78.
Accounts payable to third parties dropped by CHF 78 million due to repayments of short-term liabilities to banks.
Consolidated financial statements
4
1 747
Investor information
3.6 Own Shares held by Georg Fischer Ltd and by subsidiaries
5
Contingent liabilities
1 000 CHF
2009
2008
1 680 847
633 670
920 549
415 751
Guarantees and pledges in favour of third parties:
Guaranteed maximum amount
thereof utilized
In comparison with the previous year, the guaranteed maximum amount and the amount utilized thereof increased by approximately CHF 760 million and CHF 218 million respectively, mainly due to the guarantee with respect to the bond in the amount of
CHF 300 million which was issued by Georg Fischer Finanz AG.
Financial statements Georg Fischer Ltd
Pension fund obligations at the end of the year 2009 amounted to CHF 0.5 million (previous year: CHF 0.6 million).
Georg Fischer Ltd carries joint liability to the federal tax authorities for value added tax debts of all Swiss subsidiaries.
Income
Ordinary income from investments was reduced in comparison with the previous year, caused by the financial and economic crisis which
started in 2008 and lead to insufficient results of various corporate subsidiaries.
Compared to 2008, financial income increased mainly due to stock price adjustments on marketable securities and significantly reduced
foreign exchange losses on intercompany loans to corporate subsidiaries.
I]ZY^[[^XjaiZXdcdb^Xh^ijVi^dcWZ\^cc^c\^ci]Zb^YYaZd['%%-XVjhZYVhZkZgZhVaZhYgde[dgbVcnXdgedgViZhjWh^Y^Vg^Zh0VXXdgY^c\an!i]Z
income from corporate subsidiaries decreased as this income mainly consists of license fees for using the +GF+ brand, levied since beginning
of 2005.
In previous year the transfer of 30 investments of Georg Fischer Finanz AG to Georg Fischer Ltd caused an extraordinary dividend income
of CHF 254 million.
Affiliated companies
6
100 Georg Fischer
7
FINANCIAL STATEMENTS GEORG FISCHER LTD
Expenses
Due to the financial and economic crisis various corporate subsidiaries suffered significant sales drops during the year under review,
causing negative results. The value adjustment of CHF 240 million (previous year: CHF 50 million) was based on this situation as well as
on the still uncertain outlook for 2010. In previous year the extraordinary dividend income mentioned in note 6 caused a value adjustment
of the investment in Georg Fischer Finanz AG of CHF 254 million.
Financial expenses decreased due to the repayment of the 31/2 % bond 1999 – 2009 and the correspondingly reduced interest burden.
Short-time work as well as salary cuts for the senior management caused a reduction in personnel expenses.
The drop of income taxes mainly concerned Georg Fischer AG & Co, Singen. German income taxes in comparison with previous year
decreased due to negative results of German subsidiaries, which are taxwise consolidated at the level of Georg Fischer AG & Co. Georg
Fischer Ltd as associate of Georg Fischer AG & Co is liable for German income taxes.
8
Compensation and shareholdings
Compensation paid to the members of the Board of Directors 2009
Compensation
Cash
Share-related
compensation2
compensation1
1000 CHF
Pieces
1 000 CHF
BVgi^c=jWZg
Chairman of the Board of Directors
Bruno Hug
K^XZ8]V^gbVcd[i]Z7dVgYd[9^gZXidgh
Roman Boutellier
BZbWZgCdb^cVi^dc8dbb^iiZZ
Gerold Bührer
BZbWZg6jY^i8dbb^iiZZ
Flavio Cotti
BZbWZg8dbeZchVi^dc8dbb^iiZZ
Ulrich Graf
BZbWZg8dbeZchVi^dc8dbb^iiZZ$6jY^i8dbb^iiZZ
Gertrud Höhler
BZbWZgCdb^cVi^dc8dbb^iiZZ
Rudolf Huber
Chairman Audit Committee
Kurt E. Stirnemann
BZbWZg6jY^i8dbb^iiZZ
Zhiqiang Zhang
BZbWZg7dVgYd[9^gZXidgh
Rounding difference
Total members of Board of Directors
Other
benefits3
1 000 CHF
Total compensation
20094
1000 CHF
Total compensation
20084
1 000 CHF
211
258
172
100
26
13
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100
26
11
121
141
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1 000
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2
1 073
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721
'+
2
262
90
1 248
1 The Board of Directors 2009 foregoes 20 % of its cash compensation. The cash compensation may be drawn in the form of Georg Fischer registered
shares as per the regulations. The number of shares is calculated on the basis of the year-end share price on 30 December 2009. For 2009, compen hVi^dcVbdjci^c\id8=;('-i]djhVcYlVhYgVlc^ci]Z[dgbd[h]VgZh0dci]ZWVh^hd[Vh]VgZeg^XZd[8=;'+&#,*!i]ZcjbWZgd[h]VgZhVaadXViZY
was 1,255. Furthermore, these shares may be vested for a period of five years.
2 The share-related compensation consists in the allocation of a fixed number of shares. It is possible to vest the allocated shares for a period of five
years. The amount of the share-related compensation is calculated on the basis of the full value of the shares at the year-end price of CHF 261.75 on
30 December 2009.
3 The other benefits include employee contributions to social insurance funds and lump sum remuneration for expenses which are assumed by Georg
Fischer.
4 The total compensation encompasses the compensation plus the other benefits. Excluding employer contributions to social security of CHF 47 thousand
(previous year: CHF 55 thousand).
Georg Fischer 101
Bonus
in cash2
Share-related
compensation3
1000 CHF
2 762
1 000 CHF
986
Pieces 1 000 CHF
1 300
340
579
240
500
Pension and
social insurance funds4
1 000 CHF
987
Total compensation
20095
1 000 CHF
5 075
Total compensation
20085
1 000 CHF
5 653
226
1 176
1 136
131
& 6hd[&BVn'%%.i]Z:mZXji^kZ8dbb^iiZZkdajciVg^angZYjXZYi]Zbdci]an[^mZYhVaVgnWn&%!i]Z8:DWn'%# 2 The bonus is based on a bonus plan. The amount is determined by the fulfilment of personal performance objectives and by the financial results of the
Corporate Group and the Corporation. The bonus for the 2009 financial year was approved by the Board of Directors on 19 February 2010. Payment will
be made in 2010.
3 The share-related remuneration is based on a long-term incentive plan. Each year a fixed number of Georg Fischer shares is allocated, which is vested
for five years. The amount of the share-related compensation is calculated on the basis of the full value of the shares at the year-end price of
CHF 261.75 on 30 December 2009. All shares are transferred in 2010.
4 The pension and social insurance fund expenses include employer contributions to social insurance funds and to pension funds.
5 The total compensation is comprised of the fixed salary, the bonus, the share-related remuneration and the social and pension benefits.
Further a ordinary total compensation of CHF 519 thousand was paid in the reporting period to a member of the Executive Committee
who left this committee in the previous year.
Shareholdings of members of the Board of Directors, Executive Committee or persons related to them
Related persons and companies are defined as family members and persons or companies over which a significant influence can be
exercised. Transactions with related persons and companies must be settled on prevailing market terms.
Apart from the compensation paid to the Board of Directors and the Executive Committee and the regular contributions to the various
pension fund institutions, no transactions with related persons or companies took place.
Consolidated financial statements
Executive Committee5
of whom
Yves Serra, CEO
(highest individual salary)
Fixed salary
in cash1
Investor information
Compensation paid to the members of the Executive Committee 2009
Number of Georg Fischer
registered shares as
per 31 December 2009
BVgi^c=jWZg
8]V^gbVcd[i]Z7dVgYd[9^gZXidgh
7gjcd=j\
K^XZ8]V^gbVcd[i]Z7dVgYd[9^gZXidgh
GdbVc7djiZaa^Zg BZbWZgCdb^cVi^dc8dbb^iiZZ
<ZgdaY7“]gZg
BZbWZg6jY^i8dbb^iiZZ
;aVk^d8dii^
BZbWZg8dbeZchVi^dc8dbb^iiZZ
Jag^X]<gV[
BZbWZg8dbeZchVi^dc8dbb^iiZZ$6jY^i8dbb^iiZZ
<ZgigjY=Ž]aZg
BZbWZgCdb^cVi^dc8dbb^iiZZ
Rudolf Huber
Chairman Audit Committee
@jgi:# Hi^gcZbVcc BZbWZg6jY^i8dbb^iiZZ
O]^f^Vc\O]Vc\
BZbWZg7dVgYd[9^gZXidgh
Total members of Board of Directors
.()*
(&)(
&**&-''
&.&&
.)+
&)**
3 554
(''&
&&)%
28 095
Financial statements Georg Fischer Ltd
Shareholdings Board of Directors
Affiliated companies
When registered shares are transferred as part of the compensation, they may be vested for five years.
102 Georg Fischer
FINANCIAL STATEMENTS GEORG FISCHER LTD
Shareholdings Executive Committee
Number of Georg Fischer
registered shares
as per 31 December 2009
Yves Serra
President and CEO
Roland Abt
CFO, Head of Corporate Finance and Controlling
?dhZ[:YWVjZg
=ZVYd[<;6jidbdi^kZ
B^X]VZa=VjhZg
=ZVYd[<;6\^Z8]Vgb^aaZh
?“g\@gZWhZg
9ZaZ\ViZd[i]Z8:D[dgXdgedgViZegd_ZXih
Pietro Lori
Head of GF Piping Systems
Ernst Willi
Head of Corporate Development
Executive Committee
1 178
851
'-'
&,'
-&&
484
1 067
4 845
The registered shares transferred as part of share-related compensation are vested for five years.
Neither Georg Fischer Ltd nor its corporate subsidiaries granted any guarantees, loans, advances or credit facilities to members of the
Executive Committee or the Board of Directors or related parties.
Compensation has not involved the allocation of options to current or past members of the Executive Committee or Board of Directors.
Neither they nor any related persons possess such option rights.
In 2009, Georg Fischer did not make any severance payments to members of the Board of Directors or Executive Committee who left
the company in the period under review or earlier.
9
Risk management
:ciZgeg^hZG^h`BVcV\ZbZciVhV[jaan^ciZ\gViZYg^h`bVcV\ZbZciegdXZhh[dg<Zdg\;^hX]ZgAiYlVhhnhiZbVi^XVaanVeea^ZY^c'%%.
VheVgid[i]ZXdgedgViZ"l^YZVXi^k^i^Zh#I]ZhZb^"VccjVag^h`bVehegZeVgZYWni]Z8dgedgViZBVcV\ZbZciVahd^cXajYZheZX^[^Xg^h`h
of Georg Fischer Ltd. The structure of the likelihood was classified into four categories. Whenever possible and suitable, the risks listed
were quantified taking into consideration already planned and executed measures. Alternatively, a qualification of the risk exposure was
applied.
During the year under review, the risk maps were presented to and discussed by the Executive Committee (twice) and the Board of
Directors (once).
The following were identified as main risks: Sustainability of the value of investments in corporate subsidiaries and loans granted to
corporate subsidiaries.
Clear measures in order to reduce the risk exposure of the above mentioned as well as other identified risks were defined and are in
the process of execution. They are in line with the strategic targets of the Corporation.
10 Events after the balance sheet date
There were no events between 31 December 2009 and 19 February 2010 that would require an adjustment to the carrying amounts of
assets and liabilities or that would need to be disclosed under this heading.
There are no further facts present that would require disclosure according to Article 663 b of the Swiss Code of Obligations.
Georg Fischer 103
76 848
349 144
425 992
Proposal by the Board of Directors:
Dissolution of special reserves and attribution to retained earnings
Dividend payment
261 853
0
0
To be carried forward
569 746
425 992
Schaffhausen, 19 February 2010
For the Board of Directors
The Chairman
BVgi^c=jWZg
Consolidated financial statements
–118 099
425 992
307 893
Net loss / profit for the year
Earnings carried forward
Retained earnings
Financial statements Georg Fischer Ltd
2008
Affiliated companies
2009
1 000 CHF
Investor information
Proposal by the Board of Directors
of Georg Fischer Ltd
for the appropriation of retained earnings 2009
104 Georg Fischer
FINANCIAL STATEMENTS GEORG FISCHER LTD
Report of the Statutory Auditor on the Financial Statements
to the General Meeting of Georg Fischer Ltd, Schaffhausen
As statutory auditor, we have audited the financial statements of Georg Fischer Ltd, which are presented on pages 95 to 102
and comprise the statement of financial position, income statement, statement of changes in equity and notes for the year ended
31 December 2009.
Board of Directors’ Responsibility
The 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 Responsibility
Our responsibility is to express an opinion on these financial 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 judgement, 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 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.
Opinion
In our opinion, the financial statements for the year ended 31 December 2009 comply with Swiss law and the company’’s articles
of incorporation.
Report on Other Legal Requirements
We 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 financial statements according to the instructions of the Board of Directors.
We further confirm that the proposed appropriation of retained earnings complies with Swiss law and the company’’s articles of
incorporation. We recommend that the financial statements submitted to you be approved.
@EB<6<
Philipp Hallauer
Licensed Audit Expert
Auditor in Charge
Zurich, 19 February 2010
François Rouiller
Licensed Audit Expert
Affiliated companies
Financial statements Georg Fischer Ltd
Consolidated financial statements
Investor information
Affiliated companies
106 Georg Fischer
AFFILIATED COMPANIES
Functional currency
Share capital million
Participation %
Consolidation
Function
Belgium
Company
Europe
Austria
Corporate
Group
Country
Affiliated Companies
PS
PS
PS
AU
AU
AU
AU
AU
Georg Fischer Fittings GmbH, Traisen
Georg Fischer JRG GmbH, Wiener Neustadt
Georg Fischer Rohrleitungssysteme GmbH, Herzogenburg
Georg Fischer Automobilguss AG, Herzogenburg1
Georg Fischer Druckguss GmbH & Co KG, Herzogenburg
Georg Fischer Eisenguss GmbH, Herzogenburg
Georg Fischer GmbH & Co KG, Altenmarkt
Georg Fischer Kokillenguss GmbH, Herzogenburg
EUR
EUR
EUR
EUR
EUR
EUR
EUR
EUR
3.7
0.1
0.2
4.6
0.1
0.1
2.4
0.1
51
100
100
100
100
100
100
100
C
C
C
C
C
C
C
C
P
S
S
H
P
P
P
P
PS
Georg Fischer NV-SA, Bruxelles
EUR
0.5
100
C
S
CZK
CZK
12.3
0.1
100
100
C
C
S
S
DKK
0.5
100
C
S
EUR
EUR
EUR
6.4
1.1
4.0
100
100
100
C
C
C
H
S
S
1
Czech
Republic
AC
AC
Agie Charmilles s.r.o., Brno
System 3R Czech s.r.o., Praha1
Denmark
PS
Georg Fischer A/S, Taastrup1
1
France
CM
PS
AC
Georg Fischer Holding SAS, Palaiseau
Georg Fischer SAS, Villepinte
Agie Charmilles SAS, Palaiseau
Germany
CM
CM
CM
PS
PS
PS
PS
AU
AU
AU
AU
AU
AU
AU
AU
AU
AC
AC
AC
Georg Fischer AG & Co, Singen1
Georg Fischer Geschäftsführungs-GmbH, Singen1
Georg Fischer Giessereitechnologie GmbH, Singen
Georg Fischer DEKA GmbH, Dautphetal-Mornshausen
Georg Fischer Fluorpolymer Products GmbH, Ettenheim
Georg Fischer GmbH, Albershausen
Georg Fischer JRG GmbH, Lörrach
Georg Fischer Automobilguss GmbH, Singen
Georg Fischer Druckguss GmbH, Singen
Georg Fischer GmbH & Co KG, Mettmann
Georg Fischer GmbH, Friedrichshafen
Georg Fischer GmbH, Garching/München
Georg Fischer GmbH, Leipzig
Georg Fischer GmbH, Werdohl
Georg Fischer Verwaltungs-GmbH, Mettmann
Giessereiservice Leipzig GmbH, Leipzig
Agie Charmilles GmbH, Schorndorf
Agie Charmilles Holding GmbH, Fellbach
System 3R Europe GmbH, Gross-Gerau
EUR
EUR
EUR
EUR
EUR
EUR
EUR
EUR
EUR
EUR
EUR
EUR
EUR
EUR
EUR
EUR
EUR
EUR
EUR
25.6
0.1
0.5
2.6
4.0
2.6
0.5
12.8
2.5
17.9
0.4
1.0
0.9
0.3
0.1
0.1
2.6
5.1
0.3
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
40
100
100
100
C
C
C
C
C
C
C
C
C
C
C
C
C
C
C
E
C
C
C
H
M
M
P
P
S
S
P
M
P
P
P
P
P
M
M
S
H
S
George Fischer Sales Ltd, Coventry1
Agie Charmilles Ltd, Coventry1
GBP
GBP
4.0
2.0
100
100
C
C
S
S
Great Britain PS
AC
1 Directly held by Georg Fischer Ltd.
Consolidation
Function
100
100
100
100
100
100
C
C
C
C
C
C
H
P
P
S
P
S
Netherlands
CM
PS
PS
AC
Georg Fischer Holding NV, Epe1
Georg Fischer NV, Epe
Georg Fischer WAGA NV, Epe
Agie Charmilles BV, Lomm
EUR
EUR
EUR
EUR
0.9
0.9
0.4
0.1
100
100
100
100
C
C
C
C
H
S
P
S
Norway
PS
Georg Fischer AS, Rud1
NOK
1.0
100
C
S
Poland
PS
AC
Georg Fischer Sp.z.o.o., Warszawa1
Agie Charmilles Sp.z.o.o., Warszawa1
PLZ
PLZ
3.1
1.3
100
100
C
C
S
S
Spain
PS
AC
Georg Fischer SA, Madrid1
Agie Charmilles SA, Sant Boi de Llobregat-Barcelona1
EUR
EUR
1.5
2.7
100
100
C
C
S
S
Sweden
PS
AC
AC
Georg Fischer AB, Stockholm1
Järfälla Härdverkstad AB, Järfälla
System 3R International AB, Vällingby1
SEK
SEK
SEK
1.6
0.1
17.1
100
100
100
C
C
C
S
P
P
Switzerland
CM
CM
CM
CM
CM
CM
PS
PS
PS
PS
PS
AU
AU
AU
AC
AC
AC
AC
AC
AC
AC
AC
AC
AC
Georg Fischer Ltd, Schaffhausen
Georg Fischer Finanz AG, Schaffhausen1
Georg Fischer Liegenschaften AG, Schaffhausen1
Georg Fischer Risk Management AG, Schaffhausen1
Wibilea AG, Neuhausen1
Eisenbergwerk Gonzen AG, Sargans1
Georg Fischer JRG AG, Sissach1
Georg Fischer Kunststoffarmaturen AG, Seewis1
Georg Fischer Rohrleitungssysteme AG, Schaffhausen1
Georg Fischer Rohrleitungssysteme (Schweiz) AG, Schaffhausen1
Georg Fischer Wavin AG, Schaffhausen1
Georg Fischer Automotive AG, Schaffhausen1
Georg Fischer Engineering AG, Schaffhausen1
Georg Fischer Trading AG, Schaffhausen1
Agie Charmilles International SA, Meyrin1
Agie Charmilles Management SA, Meyrin1
Agie Charmilles Sales SA, Losone1
Agie Charmilles Services SA, Meyrin1
Agie SA, Losone1
Charmilles Technologies SA, Meyrin1
Mikron Agie Charmilles AG, Nidau1
Step-Tec AG, Luterbach1
System 3R Schweiz AG, Flawil1
Mecartex SA, Losone
CHF
CHF
CHF
CHF
CHF
CHF
CHF
CHF
CHF
CHF
CHF
CHF
CHF
EUR
CHF
CHF
CHF
CHF
CHF
CHF
CHF
CHF
CHF
CHF
82,0
10.0
12.0
0.5
1.0
0.5
1.8
2.5
20.0
0.5
17.8
1.0
0.1
0.1
4.0
0.5
2.6
3.6
10.0
10.0
3.5
1.3
1.0
0.4
100
100
100
43
49
100
100
100
100
60
100
100
100
100
100
100
100
100
100
100
98
100
30
C
C
C
C
E
F
C
C
C
C
C
C
C
C
C
C
C
C
C
C
C
C
C
E
H
M
M
M
M
M
P
P
P
S
P
M
M
M
S
M
S
S
P
P
P
P
P
P
1 Directly held by Georg Fischer Ltd.
Investor information
Participation %
0.5
0.1
0.5
1.3
0.7
3.0
Consolidated financial statements
Share capital million
EUR
EUR
EUR
EUR
EUR
EUR
Financial statements Georg Fischer Ltd
Functional currency
Georg Fischer Holding Srl, Caselle di Selvazzano
Georg Fischer Omicron Srl, Caselle di Selvazzano
Georg Fischer Pfci Srl, Valeggio sul Mincio
Georg Fischer SpA, Cernusco sul Naviglio
Georg Fischer TPA Srl, Busalla
Agie Charmilles SpA, Cusano Milanino
Europe
Italy
Affiliated companies
Company
CM
PS
PS
PS
PS
AC
Country
Corporate Group
Georg Fischer 107
Functional currency
Share capital million
Participation %
Consolidation
Function
AC
AC
TRY
Agie Charmilles Makine Tic Ltd Sti, Istanbul1
System 3R Türkiye Hassas Baglama Ekipmanlari Tic Ltd Sti, Istanbul1 TRY
1.0
0.1
100
100
C
F
S
S
UAE
PS
Georg Fischer Corys LLC, Dubai1
AED
0.3
49
E
P
America
Argentina
PS
Georg Fischer Central Plastics SA, Buenos Aires
ARS
1.4
100
C
S
Bermudas
CM
Munot Reinsurance Ltd, Hamilton1
EUR
0.1
100
C
M
Brazil
PS
AC
George Fischer Ltda, São Paulo1
Agie Charmilles Ltda, São Paulo1
BRL
BRL
1.7
60.9
100
100
C
C
S
S
Canada
PS
AU
Georg Fischer Piping Systems Ltd, Brampton1
Georg Fischer Inc, Montreal1
CAD
CAD
0.1
2.5
100
100
C
C
S
P
Mexico
PS
Georg Fischer SA de CV Mexico, Monterrey1
MXN
0.1
100
C
S
USA
CM
PS
PS
PS
PS
PS
AC
AC
George Fischer Corporation, El Monte, CA1
Georg Fischer Central Plastics LLC, Shawnee, OK
Georg Fischer Connectra LLC, Gainesville, TX
Georg Fischer LLC, Tustin, CA
Georg Fischer Signet LLC, El Monte, CA
George Fischer Sloane Inc, Little Rock, AR
Agie Charmilles LLC, Lincolnshire, IL
System 3R USA LLC, Chicago, IL
USD
USD
USD
USD
USD
USD
USD
USD
0.1
0.1
0.1
3.8
0.1
0.1
0.1
0.1
100
100
100
100
100
100
100
100
C
C
C
C
C
C
C
C
H
P
P
S
P
P
S
S
George Fischer IPS Pty Ltd, Riverwood1
George Fischer Pty Ltd, Riverwood1
AUD
AUD
7.1
6.8
100
100
C
C
H
S
Georg Fischer Business Services (Shanghai) Co Ltd, Shanghai1
Central Plastics Co Ltd, Tianjin
Georg Fischer Piping Systems Ltd, Beijing1
Georg Fischer Piping Systems Ltd, Shanghai1
Georg Fischer Piping Systems (Trading) Ltd, Shanghai1
Shanghai Georg Fischer Chinaust Plastics Fittings Corp Ltd, Shanghai1
Changchun Chinaust Automobile Parts Corp Ltd, Changchun
Chinaust Plastics Corp Ltd, Zhuozhou
Chinaust Plastics (Shenzhen) Co, Ltd, Shenzhen1
Chinaust Plastics (Sichuan) Corp, Ltd, Sichuan1
Hebei Chinaust Automotive Plastics Corp Ltd, Zhuozhou1
Shanghai Chinaust Automotive Plastics Corp Ltd, Shanghai1
Shanghai Chinaust Plastics Corp Ltd, Shanghai
Georg Fischer Automotive (Kunshan) Co Ltd, Kunshan1
Georg Fischer Automotive (Suzhou) Co Ltd, Suzhou1
ACM East China (HK) Ltd, Hongkong1
CNY
CNY
CNY
CNY
CNY
CNY
CNY
CNY
CNY
CNY
CNY
CNY
CNY
CNY
CNY
HKD
1.1
9.3
36.7
41.4
1.7
52.0
10.0
43.6
45.0
31.6
35.3
40.3
24.3
125.6
177.5
3.0
100
100
100
100
100
51
50
50
50
50
50
50
50
100
100
100
C
C
C
C
C
C
P
P
P
P
P
P
P
C
C
C
M
P
P
P
S
P
P
P
P
P
P
P
P
P
P
S
Country
Company
AFFILIATED COMPANIES
Corporate Group
108 Georg Fischer
Middle East
Turkey
Asia / Australia
Australia
CM
PS
China
CM
PS
PS
PS
PS
PS
PS
PS
PS
PS
PS
PS
PS
AU
AU
AC
1 Directly held by Georg Fischer Ltd.
PS
AC
AC
Georg Fischer Ltd, Osaka
Agie Charmilles Japan Ltd, Yokohama1
System 3R Japan Co Ltd, Tokyo1
Korea
AC
Agie Charmilles Korea Co Ltd, Seoul1
Malaysia
PS
New Zealand PS
George Fischer Sdn Bhd, Subang Jaya
1
Georg Fischer Ltd, Wellington
1
100
100
100
100
100
78
78
100
C
C
C
C
C
C
C
C
S
S
S
S
S
P
S
P
INR
97.7
100
C
P
JPY
JPY
JPY
480.0
440.0
94.0
81
100
100
C
C
C
S
S
S
KRW
975.0
100
C
S
MYR
10.0
100
C
P
NZD
0.1
100
C
S
Singapore
PS
AC
AC
George Fischer Pte Ltd, Singapore
Agie Charmilles (SEA) Pte Ltd, Singapore1
System 3R Far East Pte Ltd, Singapore1
SGD
SGD
SGD
1.0
0.6
0.8
100
100
100
C
C
C
S
S
S
Taiwan
PS
AC
Georg Fischer Piping Systems Co Ltd, Taiwan1
Agie Charmilles Taiwan Ltd, San Chung, Taipei Hsien1
TWD
TWD
1.0
10.0
100
100
C
C
S
S
Thailand
AC
Agie Charmilles Thailand Co Ltd, Bangkok1
THB
12.0
100
C
S
Corporate Group
Consolidation
CM =
PS =
AU =
AC =
C
P
E
F
Corporate Management
GF Piping Systems
GF Automotive
GF AgieCharmilles
=
=
=
=
Fully consolidated
Proportionately consolidated
Stated based on the equity method
Stated at estimated fair value
Investor information
0.1
0.5
2.5
2.5
1.7
80.3
4.5
34.7
Consolidated financial statements
Japan
HKD
HKD
CNY
CNY
CNY
CNY
CNY
CNY
Financial statements Georg Fischer Ltd
1
Function
Georg Fischer Piping Systems Pvt Ltd, Mumbai1
PS
Consolidation
India
Participation %
ACM North China (HK) Ltd, Hongkong1
Agie Charmilles China (HK) Ltd, Hongkong1
Agie Charmilles China (Shanghai) Ltd, Shanghai
Agie Charmilles China (Shenzhen) Ltd, Shenzhen
Agie Charmilles China (Tianjin) Ltd, Tianjin
Beijing Agie Charmilles Industrial Electronics Co, Ltd, Beijing1
Beijing Agie Charmilles Technology & Service Ltd, Beijing
Changzhou Agie Charmilles Machine Tool Co Ltd, Changzhou1
Share capital million
Asia / Australia
China
AC
AC
AC
AC
AC
AC
AC
AC
Functional currency
Company
Corporate Group
Country
Georg Fischer 109
H
P
M
S
=
=
=
=
Holding
Production
Management and Services
Sales
Status as of 31 December 2009
1 Directly held by Georg Fischer Ltd.
Affiliated companies
Function
110 Georg Fischer
INDEX
Index
A
Accounts receivable 58, 61, 67, 71, 75ff., 85f.
Acquisitions
44, 61, 66f., 71, 89
Annual General Meeting
53f., 112
Apprenticeship
36
Assets
44, 58, 62, 64, 66ff., 96
Assets, available for sale
58, 76
Asset turnover
44
Audit Committee
50
B
Board of Directors
46ff.
Bonds
58, 61, 68, 75, 78, 96
Brand management
19
C
Cash and cash equivalents
58, 61, 64, 68, 71, 75, 85f., 96, 98
Cash flow
4, 6 ,12, 42, 44, 61, 71, 87
Cash flow statement
61
Changes after the balance
sheet date
54, 93, 102
Charitable foundations
38
Clean Water
35, 38
Communication policy
36, 56
Compensation Committee
50
Compensation report
55f., 92f., 100f.
Conditional capital
98
Consolidated financial statements
57ff.
Contingencies
84, 99
Convertible bonds
46, 68
Core competencies
28f., 30f., 32f.
Corporate accounting principles
66ff.
Corporate Compliance
21, 52
Corporate culture
26f., 36
Corporate Governance
45ff.
Corporate Management
26
Corporate structure
26, 45f.
Cross holding
46
Current assets
44, 58, 96, 98
Customers
4f., 17f., 22
Customer satisfaction
17
D
Dates
112
Deferred taxes
58, 68, 71, 76, 78, 91
Depreciation
44, 59, 61ff., 67, 72f.
Divestments
61, 66f., 71, 90
Dividend
12, 42f., 60, 88, 103
Dividend policy
12, 88
E
Earnings per share
12, 42f., 59, 68, 92
Employees
7, 36ff., 44
Employee benefits
58, 67ff., 80ff.
Employee training
37
Environmental policy
38f.
Environmental product
38f.
Environmental production
39
Equity
6, 13, 42, 44, 58, 60, 88, 96ff.
Executive Committee
26, 45, 50f.
F
Financial assets
13, 58, 61, 66ff., 75f., 91
Financial covenants
83
Financial instruments
66ff., 75, 85ff.
Financial result
13, 59, 61, 67f., 91
Financial statements
95ff.
Financing
6, 13, 83f., 99
Five-year overview
44
Foreign currencies
13, 66, 85f., 93
G
GF AgieCharmilles
6, 17f., 32f.
GF Automotive
5, 16f., 30f.
GF Piping Systems
4, 14f., 28f.
Goodwill
44, 59, 61f., 67ff., 71, 73f., 90
Growth
12f., 22
I
IFRS
69f.
Impairment 44, 59, 61ff., 64, 67f., 72ff., 90
Income statement
44, 59, 97
Innovation
19f., 22
Innovation measurement
19f.
Intangible assets
58, 61, 67, 71, 73ff.
Integrity
36
Inventories
58, 61, 67, 76
Investments
21, 44, 46, 62ff., 73
Investments in associates
58, 62, 66f., 75, 96ff., 106ff.
Investor Relations
27, 54
ISO certification
37
K
Key indicators
4ff., 44
L
Leases
68, 72, 84, 88
Liabilities
44, 50, 58, 61, 68, 83f., 96, 99
Liabilities and equity
44, 58, 66ff., 96
Liquidity
58, 61, 67
Loans
58, 61, 66ff., 76, 96, 98f.
Loss carry forwards
78, 91f.
M
Management compensation 55f., 92f., 100f.
Market capitalization
42f., 45
Market share
4f., 19
Market trend
4f., 28f., 30f., 32f.
Mid-year report
112
Minority interests
58ff., 66, 88
N
Net debt
6, 12, 44, 83, 90
Net profit
12f.
Net value added
37
NOA
42
Nomination Committee
51
Nominee
47
Non-current assets
44, 58, 67, 96, 98
O
Objectives
13f., 22f.
Operating expenses
59, 89
Options, option programmes 47, 56, 67f., 102
Order intake
44, 62f.
Orders on hand
44, 62f.
Outlook
6, 14, 16, 17, 23
Own Shares
60, 68, 96ff.
P
Personnel expenses
59, 89, 97
Pledged assets
88
Process improvements
20f.
Product development
20f.
Profitability
12
Property, plant and equipment
8, 21, 58, 64., 67, 72ff.
Provisions
58, 61, 68f., 79, 96
Publications
19, 36, 112
Q
Quality
37f.
R
Reduction in par value
42, 60f., 88, 97
Related parties
92f., 101f.
Report of the Statutory Auditors
94, 104
Research and
development (R&D)
19f., 62, 68, 89
Responsibility
36f.
Risk management
20, 52, 84ff.
S
Salaries
55f., 92f., 100f.
Sales trend
4f., 12, 46
Scope of consolidation
66, 71
Securities
58, 61, 68, 75f., 87, 96
Segment information
62ff., 67
Share information
42f., 45, 59, 68, 92
Social policies
36f.
Special charges
12, 44, 59, 90
Statement of comprehensive income
59
Statement of financial positions
6, 44, 58, 96
Strategy
6f., 13f., 22f., 28f., 30f., 32f.
Success factors, strategic
6
Sustainability
36ff.
T
Taxes
58ff., 68, 70, 78, 91, 97
Technology
19f.
Trade accounts payable
58, 61ff., 75, 83f., 96, 99
Trends
28f., 30f., 32f.
V
Value added
12, 37
Value adjustment
67, 76f., 90
Locally anchored,
globally active
Europe
Asia, Near East
America
Australia
78 companies
39 companies
15 companies
3 companies
Production plants
Austria, Germany, Italy,
Netherlands, Sweden,
Switzerland
Production plants
China, India, Malaysia,
United Arab Emirates
Production plants
Canada, USA
Service and sales centers
Australia, New Zealand
Service and sales centers
Austria, Belgium, Czech
Republic, Denmark, France,
Germany, Great Britain,
Italy, Netherlands, Norway,
Poland, Spain, Sweden,
Switzerland
Service and sales centers
China, Japan, Korea,
Singapore, Taiwan,
Thailand, Turkey
Service and sales centers
Argentina, Bermudas,
Brazil, Canada, Mexico,
USA
Corporate publications
Disclaimer
Globe
Employee newspaper, German, English, French, Italian
and Chinese, three times a year
The statements in this publication relating to matters that
are not historical facts are forward-looking statements that
are not guarantees of future performance and involve risks,
uncertainties and other factors beyond the control of the
company.
We thank our customers for giving their consent to the
reports on the use of our products in their company.
For legal reasons, we wish to state that the mention of
government institutions in connection with Georg Fischer
does not imply any support or advertising for GF.
Corporate Sustainability Report
German and English
Corporate Profile
Flyer, German and English
Annual Report
Annual Report of the Georg Fischer Ltd,
German and English
Ferrum
Magazine of the iron library, German
Internet
You‘ll find continuously updated information about the
Georg Fischer Corporation under www.georgfischer.com.
Publisher’s information
Published by: Georg Fischer Ltd; Edited by: Georg Fischer Ltd, Corporate Development; Editorial assistance: Sibylla Machens,
Bastian Steineck, Wolfgang Hörner, Johannes Fritsche; Designed by: BBF Communication + Design; Photos by: Theodor
Stalder, Andrin Winteler; all other photos: Georg Fischer and customers, Gettyimages, Shutterstock; Translation: bmp translations ag, Basel; Printed by: stamm+co. AG, Schleitheim
700671423
Investor Relations
Daniel Bösiger
Phone+41 (0) 52 631 21 12
Fax +41 (0) 52 631 28 16
daniel.boesiger@georgfischer.com
Communications
Bettina Schmidt
Phone+41 (0) 52 631 26 74
Fax +41 (0) 52 631 28 63
bettina.schmidt@georgfischer.com
For further information please
go to www.georgfischer.com.
24 March 2010
Annual General Meeting
of the fiscal year 2009
19 July 2010
Publication of
mid-year report 2010
1 March 2011
Publication of
Annual Report 2010,
Media and Financial Analysts’
Conference
23 March 2011
Annual General Meeting
of the fiscal year 2010
Georg Fischer Ltd
Amsler-Laffon-Strasse 9
8201 Schaffhausen
Switzerland
Phone+41 (0) 52 631 11 11
www.georgfischer.com
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