Schweiter GB 03 englisch · 2014-10-16 · crucial test passed for improved network of sup-pliers. Halving of lead times in production. Organization Tried-and-tested organization

2003

Schweiter Technologies

Annual Report 2003

3

Contents

Board of Directors, Group Management, Auditors

Report of the Board of Directors

Key figures

Portfolio strategy

Group performance

Essentials of the consolidated income statement

Essentials of the consolidated balance sheet

SSM Textile Machinery

Satis Vacuum

Ismeca Automation

Ismeca Semiconductor

Consolidated financial statementsof the Schweiter Technologies Groupincluding the report of the Group auditors

Annual financial statements of Schweiter Technologies AGincluding the report of the statutory auditors

Corporate Governance at Schweiter Technologies

Addresses

4

5

6

7

8

10

12

18

20

22

24

27 – 61

63 – 71

73 – 88

90 – 91


4

Schweiter Technologies Group

Board of Directors, Group Management, Auditors

Board of Directors Term of office 2003 to 2006

Dr. Hans WidmerHeinrich FischerMarcel M. MeierDr. Jean-Pierre NardinRolf-D. SchoemezlerDr. Gregor Strasser

Group Beat SiegristManagement Dr. Heinz O. Baumgartner

Walter NadalinDr. Urs MeyerSerge PeguironBeat Siegrist

Auditors Deloitte & Touche AGZurich

Chairman

Chief Executive Officer GroupChief Financial Officer Group

Chief Executive Officer SSM Textile MachineryChief Executive Officer Satis VacuumChief Executive Officer Ismeca AutomationChief Executive Officer Ismeca Semiconductor

5

Dear shareholders

The Group has posted an operating profit ofCHF 17 million and net income amounting to justunder CHF 18 million on sales of CHF 270 million.The net cash position jumped from CHF 6 millionto CHF 40 million, while the equity ratio grew from52% to 62%.

After two years of declining orders, 2003 sawan 11% increase in new orders to CHF 289 million.The contraction in sales by a further 16% or aroundCHF 52 million affected all divisions, with sales de-clining by CHF 19 million at SSM Textile Machinery(TEX), CHF 4 million at Satis Vacuum (VAC), CHF16 million at Ismeca Automation (AUT) and CHF13 million at Ismeca Semiconductor (SEM).

However, the CHF 52 million falloff in sales wasonly reflected in half as great a decline in operatingperformance (2002 having seen extensive sellingfrom stock). Overall, the result was a gratifying profit – despite the decline in volume – thanks toimprovements in margins and a further reductionin fixed overheads. Regrettably, this reduction inoverheads led to further redundancies at IsmecaAutomation and Semiconductor involving some 80 personnel. At the end of the year, the payrollheadcount stood at 741, as compared with 824 theprevious year.

The machinery business sector is a cyclical industry and sales in the TEX, VAC and SEM divisions peaked in 2000, while AUT sales were highest in 2001. Conversely, 2003 marked a lowpoint for all subsidiaries except VAC. The cyclicalfluctuations of AUT and SEM, with swings of +/- 55% between 1999 and 2003, are at least slightly mitigated by the those of VAC (+/- 15%) andTEX (+/- 20%).

According to the economic cycle, 2004 shouldsee the start of a renewed upturn, as is confirmedby the increasing order intake in the fourth quarterof 2003. As break-even sales are lower than half ofthe average sales over the past 5 years, this shouldmean more gratifying results. Having said this,

currency factors can be expected to have a negativeimpact if the US dollar persists at its low level.

In 2003, net income was affected by favorabletax and exchange rates: the exploitation of tax losses carried forward at VAC and capitalized taxlosses carried forward at AUT and SEM compen-sated for the tax expenses at TEX. Hedging againsta falling dollar and exchange rate gains on the euroled to a net currency gain.

The previous year's write-down of all but CHF 6 million in goodwill arising from the acquisi-tion of Ismeca had practically no further adverseimpact on the 2003 annual result.

During the year under review, cash flow onceagain showed a positive trend. In addition to theoperating profit, a further reduction in net assetsby CHF 21 million led to a cash flow of some CHF35 million. This was used for an extensive reduc-tion in interest-bearing liabilities by CHF 33 mil-lion. At the end of 2003, this left the Group free ofdebts (apart from mortgage loans of CHF 6 mil-lion) and with a cash position of CHF 49 million.

Instead of a dividend payment of CHF 3 per bearer share with a nominal value of CHF 10, theBoard of Directors is proposing that the GeneralMeeting adopt a reduction in nominal value by thesame amount. According to a new guideline, 25%of annual profit should be distributed provided thata company has an equity ratio of at least 45%.

Staff share in the profits of their division withup to two monthly salaries. The Board of Directorswould like to thank all staff for their sterling effortsand wishes everyone a very successful year in 2004.

Yours sincerely

Report of the Board of Directors


6


Key figures

Group

Orders receivedGross revenuesOperating performance

Operating result before amortization of goodwillOperating result after amortization of goodwill

Net income/loss

Development expensesInvestments in property, plant and equipment

Overall balance sheet total Shareholders' equity

Average headcountAverage gross revenues per employee

Stock market capitalization as at Dec. 31

Earnings/ loss per share before dilutionEarnings/ loss per share after dilution

Holding

Net income/loss

Share capital as at December 31– subdivided into bearer shares

with a par value of CHF 10 each

Conditional share capital– for share option plan– for bonds or similar issues

Authorized share capital

Proposal of the Board of Directors– Reduction in nominal value and distribution

in CHF 1000s

in CHF 1000s

in CHF 1000s

in CHF 1000s

in CHF 1000s

as % of operating performance

in CHF 1000s


in CHF 1000s

in CHF 1000s

in CHF 1000s

in CHF 1000s

as % of assets

in CHF 1000s

in CHF 1000s

in CHF

in CHF

in CHF 1000s

in CHF 1000s

in CHF 1000s

in CHF 1000s

in CHF 1000s

in CHF 1000s

in CHF per share

2003

288 600269 973261 388

17 57017 217

6.6

17 7336.8

16 6176 029

207 843129 450

62.3

782345

297 757

12.3012.30

2003

17 538

14 437

1326326

1000

3 000

3.00

35

For additional details see notes to the consolidated financial statements.▲

2002

260 100322 448

285 007

6 482- 40 178

-

- 48 665-

18 2153 601

220 228114 453

52.0

917352

115 494

- 35.10- 35.10

2002

- 37 677

14 437

1326326

1000

3 000

-

7


1. Schweiter Technologies is developing businessunits in the high-tech mechanical engineering sec-tor. The aim is to cover a maximum of customerneeds with a minimum of standardized and modu-larized components and machinery. This is the basis for quality, cost-effectiveness and reliable procurement. Ismeca Automation is also aiming inthis direction, even though the production runs ofidentical plants are small and their engineering content is considerable.

2. Each division is a global market leader in itschosen market segments – or at least has the potential to become one. Each is autonomous – including financially.

3. Each division pursues a soundly based strategywhich is subjected to annual adjustments. Its coreconsists of innovation (starting point for all successto date), an in-house global sales and service systemand exclusive concentration on critical value creation. Structures are light and communicationsdirect. Weaknesses are rapidly recognizable andfunding requirements are low. The net result shouldlargely be free cash flow.

4. The holding company is not interested in buy-ing and selling business units, but aims to developthem beyond the time-span of current players. Theaim of the acquisitions (there have been nine signi-ficant acquisitions since 1987) is to expand existingpositions. The present diversity of sectors gives theportfolio a welcome element of stability – althoughthis was not the intention. Divestments (three todate) are made where a division will have greaterdevelopment opportunities, and hence greater value, under a different owner. Or if it has no pro-spect of market leadership.

5. With just three positions, the holding companyhas very lean staffing levels: the CEO of the holdingcompany (currently also the CEO of Ismeca Semiconductor), the CFO of the holding companyand the Head of Group Reporting & Controlling.There is a cross transfer of core know-how. Onemember of the Board of Directors concentrates onone division (with monthly performance reviews).

Acquisitions Share capital Dividend paymentsin CHF 1000s in CHF

1989 Establishment of SSM 8 100from Schärer, Schweiter and Mettler

1998 Satis Vacuum, Baar 8 800 1.401999 Stähle Eltex, Reutlingen, Germany 8 800 1.60

Hacoba-Spultechnik, Wuppertal, Germany2000 Ismeca SA, La Chaux-de-Fonds 9 886 1.80

RTC Systems, London2001 - 11 924 -2002 - 14 437 -2003 - 14 437 3.00 (Reduction in

nominal value)

Portfolio strategy

8


Group performance

Market leadership / marketing

Market position at SSM Textile Machinerystronger across the board. Clear improvements inthe air texturing sector. Establishment and expan-sion of an assembly facility in China to supply thelocal market.

Satis Vacuum's market lead expanded thanksto close cooperation with world's leading spectaclelens manufacturer. Market position in US expanded(43% increase in sales in USD in 2003).

Ismeca Automation established in the medicaltechnology sector. Successful expansion of medi-cal /pharmaceutical segment in 2003 (39% share ofsales as against 27% in 2002 and 13% in 2001). It isexpected to account for more than 50% of divi-sion sales in 2004.

Ismeca Semiconductor with considerable in-novative inputs whose final market acceptance hasyet to be established. Product launches get off tosuccessful start. Initial confirmation of market acceptance with clear increase in order intake atend of year.

Innovation

Two major innovations at SSM Textile Machi-nery in the electronic control of thread tensioning(digitens™) and in electronic thread laying (new fastflex™ aggregate) with 50% higher output.

Satis Vacuum with an innovative antistatic anti-reflective treatment process in the box-coaterproduct line and a new type of hydrophobic coat-ing. Further completion of technology portfoliothrough cooperative venture with Schott HiCotecfor the market launch of the PICVD coating tech-nology.

Ismeca Automation with the development of anew linear platform and new process componentsin particular for medical technology.

Ismeca Semiconductor with the developmentof two new types of machine: new high-speed machine for ultra-small components and new wafer-to-tape machine for processing the latest generation of components directly from wafers.

Supply management

Optimization of manufacturing processes atSSM Textile Machinery with the successful estab-lishment of an assembly unit in the Czech Republic.From mid-2004, the local market in China is to besupplied with an initial group of products on the basis of its own on-the-spot supply management.

Further improvements in margins at Satis Vacuum through targeted savings in the cost of materials for core components.

Product standardizations at Ismeca Semicon-ductor with savings in purchasing and logistics. Firstcrucial test passed for improved network of sup-pliers. Halving of lead times in production.

Organization

Tried-and-tested organization and manage-ment team has once again streamlined structuresand processes. SSM Textile Machinery has signifi-cantly reduced structural costs by moving into anew factory in Reutlingen.

Ismeca Automation and Ismeca Semiconduc-tor have rapidly and efficiently implemented a further reduction in capacity to match the lowermarket volume. Following the previous separationof their management functions in 2003, the two divisions are now set to become completely sepa-rate legal entities.

Outlook

Strong competition in all areas. Pressure onmargins on the currency front and an initially hesitant revival in some markets. Despite thesechallenges there are growing signs of a cyclical recovery. A motivated team and slightly more favorable market conditions should make it possi-ble to achieve a good result in 2004.

9


TEX VAC SEMAUTOperating resultas % of operatingperformance(previous year)

19%

(17%)14%

(2%)

(-15%)

-9%

-13%

(-10%)

*Net assets = Trade receivables, inventories & work in progress and property, plant & equipment minus trade liabilities and payments on account received from customers

**RONA = Operating profit as % of the average net assets (return on net assets)

(in CHF m)

Orders received(previous year)

Operating performance(previous year)

Operating result(before goodwill amortization)

(previous year)as % of operating performance(previous year)

Headcount (December 31)(previous year)

Net assets*(previous year)

RONA**(previous year)


115(-9%)

104(-13%)

20.1

(20.0)19%

(17%)

208(-2%)

25(21)

87%(95%)

Satis Vacuum

62(-1%)

61(-5%)

8.5

(1.2)14%(2%)

142(-1%)

24(29)

32%(3%)

Ismeca Automation

44(-2%)

37(-19%)

-3.4

(-4.8)-9%

(-10%)

128(-25%)

10(17)

-25%(-28%)

Total

289(+11%)

261(-8%)

17.5

(6.5)7%

(2%)

741(-10%)

110(131)

15%(5%)


68(+131%)

59(-5%)

-7.7

(-9.5)-13%(-15%)

261(-12%)

51(64)

-13%(-15%)

10

Sales

16% year-on-year decline. The CHF 52 millioncontraction affected all divisions with sales slump-ing by CHF 19 million at SSM Textile Machinery(TEX), CHF 4 million at Satis Vacuum (VAC), CHF 16 million at Ismeca Automation (AUT) andCHF 13 million at Ismeca Semiconductor (SEM).

Outlook for improvement in 2004: TEX andVAC have got off to a good start. AUT is benefitingfrom good order-book levels and at the end of 2003 SEM saw a revival in its order intake which iscontinuing at the beginning of 2004.

Essentials of the consolidated income statement

CHF m

2000 2001 2002 20031999

0

Operating result

Significantly lower goodwill amortizations / impairment and value adjustments. Other factorswhich helped to improve the operating result were further reductions in fixed overheads and ahigher gross margin. The decline in volume had anegative impact on the operating result.

TEX

VAC

AUT*

SEM *


2000 2001 2002 20031999

CHF m

SEM *

AUT*

VAC

TEX

0

0

-8

41

5

-10

20

23

17

20

12

4

9

5

-4

1

11

-9

-1

-5-3

293270

448

523

322

61

34

65

110

100

47

48

98

208

88

75

152

120

121

72

135

74

50

69

129

*Acquisitionin 2000

*Acquisitionin 2000


11

0

2001 2002 20032000

Annual result

Favourable tax ratios at Satis Vacuum and capitalized tax losses carried forward at Ismeca Automation and Ismeca Semiconductor at head office, coupled with a positive financial result, hada favorable impact on net income.

Price of bearer shares

2003 saw a marked recovery in our share price. At the end of the year, 1.44 million shareswere outstanding. As of December 31, 2003, themost important shareholders were Dr. Hans Widmer/Hans Widmer Management AG (25%),the CREDIT SUISSE Group (16%) and Beat Siegrist(5%).

31.3.04

1295

200

CHF m

CHF

345

80

2000 2001 2002 20031999

56.4

17.621.1

18.3

6.5

4.2 *34.916.6 17.7

46.7*** including: amortization of goodwill 104.2extraordinary financial income 111.4

** Impairment Ismeca

0

206

Operating profit

Amortization of goodwill,financial result,taxes

Annual result

-48.7


12

Essentials of the consolidated balance sheet

Assets

Cash and cash equivalents

The net cash position increased by CHF 34 mil-lion to more than CHF 40 million. The operatingresult of CHF 17 million and the further reductionin net assets meant that interest-bearing liabilitieswere largely eliminated. At CHF 49 million, the highcash holdings remained virtually unchanged (+1)compared with the previous year.

Net assets

Net assets decreased by a further CHF 21 mil-lion to CHF 110 million. Net assets consisted oftrade receivables (55), inventories (51), propertyplant and equipment (27), trade liabilities (18) andpayments on account received from customers (5).Capital tied up in property plant and equipment isminimal thanks to lean structures and systematicoutsourcing and consists primarily of Ismeca's buil-ding (head office and production site in La Chaux-de-Fonds).

Goodwill

The balance sheet shows only a small goodwillposition of less than CHF 6 million.

Liabilities

Interest-bearing liabilities

The operating cash flow allowed a further reduction in interest-bearing liabilities by CHF 33million. The remaining interest-bearing liabilitiesamounting to CHF 8 million now consist mainly ofmortgage loans.

Shareholders' equity

At CHF 129 million, shareholders' equity ex-ceeded net assets for the first time. The ratio ofshareholders' equity to total assets improved againfrom 52% to 62%.

1999 2000 2001 20032002

147

-37

6

40

Development net cash

Net cash

Net debt

Acquisition Ismeca

CHF m

13


Assets Liabilities

2000 2001 2002 2003 2001 2000

Other 38

33

16

153

112

205

174

131

67

48

49

6

129 127

94

8

74

105

46

86

196

113

36

62%

114

42

45

52% 35% 16%

Goodwill

Cash

* Net assets

Other

Liabilitiesfrom acquisition

Interest-bearingliabilities

Equity

*Net assets = Trade receivables, inventories & work in progress and property, plant & equipment minus trade liabilities and payments on account received from customers

186

49

110

2003 2002

Equity ratioCHF m

Jean-Charles Authier Lino Barbieri

Hans-Peter Eigenmann Patrick Epp

Urs Gull Daniel Hess Christian Hotz

Heinz O. Baumgartner

Didier Faller

Jean-Paul Boillon Filippo Casazza Larry Clarke

Bruno Fischer Gilbert Fluetsch

Werner Kalb Philippe Lorenz Horst Lüchinger

Heinrich Fischer

Eugen Pfiffner Gérard Probst

Sandor Sipos

Marcel M. Meier Urs Meyer Walter Nadalin

Erik Poulsen

Beat Siegrist Gregor Strasser

Frédéric Rappan Marc Schaad

Claudio Zinetti

Camillo Narcisi Jean-Pierre Nardin Serge Peguiron

Rolf-D. Schoemezler

Hans Widmer Michael Witzany

The division posted a good result despite theITMA and the weak dollar. During the period under review, sales declined by 15% to CHF 110million (previous year 129), but the operating profit was held at CHF 20 million, spelling an im-provement in the EBIT margin from 15% to 18%.

In this environment, the main objectives wereto maintain profitability and be ready to present aseries of new products at the ITMA, the world'smost important textile machinery trade fair. It isheld at four-yearly intervals.

Market

After getting off to a good start, demanddecreased sharply in the second and third quartersunder the impact of the Iraq War and SARS, but revived again in the fourth quarter after the ITMA,with Turkey the driving force. SARS and the weakdollar meant that Asia, and more especially China,fared less well than in 2002. In the sewing yarn seg-ment, we were able to win back market share withnew products and after a sluggish 2002 the air tex-turing segment performed well. The Americas(North, Central and South) also performed betterthan initially anticipated.

Many customers, particularly manufacturers ofnatural fibers and filament commodities, proved anxious, or in many cases even desperate, in the face of rising fiber and textile production from China and adopted a very cautious approach to newinvestments. There was a correspondingly strongdesire to establish a distinctive profile comparedwith Chinese manufacturers. SSM had the right products to meet these customers' needs.

Product range

The 2003 ITMA once again provided a majoropportunity and motivation for presenting innova-tions and new products to the textile community.SSM Textile Machinery equipped all existing machi-nes with two new features: digitens™, a system forthe electronic control of thread tensioning, and the fastflex™ aggregate, the second generation of

the preciflex™ system, which has now become theindustry standard and offers a 50% increase in efficiency. In addition, three machines were intro-duced for new segments and the new Uniplex™machine, hailed in technical circles as a revolutionin the spinning sector, was unveiled. This machineis the outcome of an exclusive cooperative ventu-re with DuPont and will be used for the productionof synthetic staple fiber. The stretch-break processemployed reduces the five processing stages cur-rently required to just one.

Organization

The size of Hacoba's Wuppertal plant has been adjusted to the needs of the sewing yarn segment. SSM Stähle Eltex in Reutlingen has movedinto new premises which are better suited to mod-ern production and offer scope for expansion. With the establishment of SSM (Zhongshan), SSMnow has its own manufacturing and customer ser-vice site in China, enabling it to serve this growthmarket even more effectively and at closer proxi-mity to customers.

Outlook

At the beginning of the year, the outlook is more positive than it was this time last year. Thisassessment is based on such factors as new prod-ucts, newly penetrated segments, a respectable order backlog, lean structures and an improved economic climate. However, the persisting weak-ness of the US dollar may have a negative impact onthe 2004 result and favors local machine manufac-turers, particularly in Asia. SSM (Zhongshan) and aglobal sourcing organization will enable SSM TextileMachinery to respond to this situation.


18


19


ManagementWalter Nadalin Chief Executive OfficerChristian Hotz Chief Financial OfficerMarc Schaad Head of R&DClaudio Zinetti Head of Supply

Head of Supply GroupPeter Herzog Head of Production

(until September 2003)

Patrick Epp Head of Marketing / SalesRalf Lucht Head of Hacoba Spultechnik

(from April 2003)

Walter Nadalin Head of SSM Stähle EltexHorst Lüchinger Head of SSM Far East

Machine programmeSSM – Doubling, dyeing, winding, singeing, air covering, yarn preparation machines and elastane processing machines Hacoba – Final make-up of sewing yarns, wire winding machines SSM Stähle Eltex – Air jet texturing machines, heat draw setting machines

Sales marketsEurope 55% (incl. Turkey and Middle East) Americas 12%Asia 33% (incl. India)

2000• Extraordinarily high demand everywhere • Expansion of product range 2001• Fall in demand• New products at Stähle Eltex • Correction of structural costs (extensive

integration of Stähle Eltex, Hacoba into SSM)• Increased outsourcing2002• Increase in profitability • New product line for sewing yarn • Development and sales centralized2003• Launch of various new products (ITMA)• Cooperation with DuPont on the development

of a new spinning process (Uniplex™)• Establishment of SSM (Zhongshan) Ltd., China

0

175 299 260 212 208Employees at year-end

Gross revenues

CHF m

1999 2000 2001 2002 2003

20

17

23

20

12 110

98

152

135129

Operating profit *

*Scale 10 times gross sales

20

Satis Vacuum can look back on the best year in its history. Despite a slight decline in gross rev-enues to CHF 65 million, the division has posted avery positive operating profit of CHF 8.5 millionthanks in particular to savings on the cost of ma-terials, the absence of extraordinary value adjust-ments, and fixed overheads which have been heldat last year's level. This corresponds to a 13% EBITmargin on sales.

Market

The European market has proved robust, butlacking in growth stimuli. New projects and custo-mers have been gained and sales were on a par withlast year's levels.

Weak US retail figures in the first quarter delayed an expansion in sales of the new compactmachine for the sales front (sputtering technology).However, major US lens manufacturers and retailchains significantly expanded their coating capacity.Thanks to a strong sales organization and intensi-fied cooperation with key accounts, sales in thehigh-growth US market increased by a handsome43% in USD terms (+24% in CHF).

Overall, in both Europe and the US, the con-solidation process at customer level continued andthe major lens manufacturers bought up more local prescription lens manufacturers in a move toward vertical integration. As Satis Vacuum hasestablished strong relationships with both groups,this consolidation should further strengthen SatisVacuum's already high market share.

Product range

The box coater product line meets market re-quirements very effectively and has been supple-mented by an innovative antistatic anti-reflectivetreatment process and a new type of hydrophobiccoating.

At the beginning of the year, a cooperative venture was agreed with Schott HiCotec for themarket launch of PICVD technology. This techno-

logy offers customers a clear cost advantage in thecoating of stock lenses and is allowing Satis Vacu-um to increase its operations in this segment, whichhas not previously been one of its strong areas. Thisnew technology is meeting with a great deal of in-terest and projects have been launched with someimportant customers.

The practical applications of the compact ma-chine have been systematically expanded to servesmall prescription lens manufacturers, particularlyin new and developing markets, in addition to retailchains.

Organization

After the previous year's reduction by a clear25%, fixed overheads were maintained. The focuswas on further reductions in the cost of materials.

Outlook

The market for antireflective coating systemsfor spectacle lenses still has a medium-term growthpotential of 6%, with the focus still firmly on thehigh-growth US market. Local sale and servicestructures are to be expanded in stages.

Sputter technology, and now also PICVD tech-nology, are opening up new application and marketsegments with corresponding growth potential.

The systematic international procurement ofcore components, particularly from Asia, shouldfurther reduce plant manufacturing costs, therebypreserving competitiveness and profitability.


Satis Vacuum

21

Satis Vacuum

ManagementDr. Urs Meyer Chief Executive OfficerBruno Fischer Chief Financial OfficerHans-Peter Eigenmann Head of Marketing / SalesLino Barbieri Head of Technical ServicesFilippo Casazza Head of Satis Vacuum Italy

and R&DMichael Witzany Head of SputteringWerner Kalb Head of ConsumablesLarry Clarke Head of Satis Vacuum USA

Machine programmeOphthalmicsSystems for pre-treatment, anti-reflective treat-ment and coating of spectacle lenses based on high-vacuum PVD, sputtering and CVD technologiesPrecision optics and special applicationsSystems for manufacturing optical layers and coating optical components

Sales markets Europe 65%Americas 30%Asia 5%

2001• DWDM venture aborted• Structural costs too high in ophthalmics2002• Venture adjusted, structural costs reduced• Fall-off in demand (second half of year)• Innovations launched, sputtering has proved

itself in tests with customers2003• Expansion of market position in US• Key accounts won in Europe and the US• Sputtering operations reach break-even point• Partnership with Schott HiCotec for market

launch of PICVD technology • Fixed overheads unchanged, but savings on

procurement

Operating result *

Gross revenues

CHF m

1999 2000 2001 2002 2003


0

9

65

4

5

-4

1

48


7572 69

22

For the majority of strategic products, the market recovery expected at the end of 2002 failed to materialize, with the first half of 2003 remaining particularly weak. Sales contracted toCHF 34 million, which meant that structural ad-justments formed a key focal point.

Market

The three target segments experienced dif-ferent levels of momentum in an environment whichwas generally still fragile and fragmented.

Ismeca Automation accomplished a furthermajor step forward in medical technology, which isnow the number one segment ahead of inkjet cartridges. Medical technology grew by more than25% and will continue to provide the impetus forfurther growth in 2004. In 2003, this business seg-ment accounted for nearly 40% of Ismeca Auto-mation's total sales.

The electrical connections sector experienceda slight recovery, but investment remained modest.2004 may see a slight improvement.

The market for inkjet cartridges remained subdued, albeit with moderate growth. The key products are AIO (all-in-one) and photo printers.Ismeca strengthened its cooperation as the globalmarket leader's preferred supplier.

Despite a disappointing first half of 2003, an order intake of CHF 28 million in the second halfof the year pointed in the right direction and thetotal of CHF 44 million resulted in a comfortablevolume of orders on hand for the new year.

Sales and result

A shortage of orders on hand and new ordersin the first half of the year and the weakness of theUS dollar resulted in a 25% reduction in sales com-pared with the previous year.

Operating improvements and higher sales inthe second half of the year meant that balanced

accounts could be presented, so averting an in-crease in the CHF 3.4 million loss reported in thefirst half of the year.

Organization

During the course of 2003, operational man-agement was both simplified and strengthened, aswere the marketing and sale structures.

Fixed overheads were also reduced by a fur-ther 20%, which means that break-even sales nowstand at around 40 million.

The almost complete dismantling of the struc-tures in California and the moderate adjustment tostaff numbers in Switzerland led to a headcount of130 employees, compared with 160 at the begin-ning of the year.

Outlook

The gratifying order backlog and the consoli-dation in the medical technology and inkjet car-tridges sectors limit the risk exposure, and the goodmix of projects prompts us to expect a result in positive territory, albeit only slightly. The US dollarexchange rate and the continuing fragile state of theglobal economy will remain negative factors.


Ismeca Automation

23

Ismeca Automation

ManagementSerge Peguiron Chief Executive OfficerDidier Faller Chief Financial OfficerJean-Paul Boillon Head of EngineeringFrédéric Rappan Head of SupplyErik Poulsen Head of Marketing / Sales

Machine programmeAssembly automation for: • Medical technology• Electromechanical components • Inkjet cartridges

Sales marketsEurope 34%Americas 65%Asia 1%

2000• Still some “filler projects”

(with inadequate margins)• Expensive US operation2001• High demand in the segments inkjet cartridges

and medical technology• Predominance of repeat orders• New projects subject to strict selection• Turnaround in US operation2002• Sharp fall in order backlog at the beginning

of the year• Drastic restructuring measures at Ismeca USA2003• Adjustment of capacity• Adjustment of structures in US• Successful expansion of medical business• Good backlog of orders at the end of 2003

Gross revenues

CHF m

1999 2000 2001 2002 2003


0

-3

Operating result *


-9

-1

11

-5

60

34

88

121

50

24

2003 began as another difficult year for IsmecaSemiconductor, the upturn only setting in in the lastquarter. The result was once again depressed by de-preciations, particularly on machinery and projects.

Market

China and Malaysia were the most importantmarkets. Two high-profile orders from Mexico were booked toward the end of the year. Overall,the market for machines in the back-end of the semiconductor industry recovered in the last quarter of the year. Almost half of the order intakeof CHF 68 million (previous year: 29) only ma-terialized in the last four months of the year. Thereis still tremendous price pressure, brought on inparticular by the low US dollar.

Sales and result

At CHF 61 million, sales were below budget.Structural costs were once again reduced, but thecompany still posted a distinctly negative operatingresult (EBIT), as additional depreciations amountingto some CHF 4 million further depressed the re-sult.

Product range

Two machine models in particular contributedto the market success toward the end of the year:an extremely fast machine for ultra-small electro-nic components with a throughput rate of morethan 30 000 units per hour and a machine capableof processing the latest generation of componentsstraight from the wafer. However, leading manufac-turers also opted for Ismeca's machine concepts in the Power and SO ICs (small outlet integratedcircuits) sectors. In addition, a new machine for in-specting memory ICs is undergoing market testing.

Organization

The new, simpler organization has proved effective, but has been further streamlined. The global headcount now stands at 260. Cooperationwith suppliers is progressing well. In particular, leadtimes for the production of machines have been reduced to an average of two to three months.

Outlook

Innovative, top-quality products and a solidmarket position form the basis for the future. Manycustomers are boasting installed production capa-city utilization rates of over 90%, giving some grounds for confidence in a sustained market recovery. However, 2004 will not be an easy year.Prices and sales will be depressed by continuingstrong competition, particularly from the US dollarzone. Overall, though, new orders and sales are expected to increase. With a motivated team – anda little luck – it may well be possible to deliver animpressive result in 2004.



25


ManagementBeat Siegrist Chief Executive OfficerCamillo Narcisi Chief Financial OfficerJean-Charles Authier Head of R&DEugen Pfiffner Head of SupplyPhilippe Lorenz Head of ProductionUrs Gull Head of Marketing / SalesSandor Sipos Head of ServicesDaniel Hess Head of Semic. North AsiaGérard Probst Head of Semic. South AsiaGilbert Fluetsch Head of Semic. North America

Machine programmeHigh-speed machines for finishing, testing, inspection, marking and taping of • discretes• IC’s

Sales markets Europe 22%Americas 14%Asia 64%

2000• Boom: order intake worth CHF 303 million• High order backlog as of 31 December • Almost 700 employees as of 31 December2001• Sharp fall compared with previous year:

Order intake falls to just CHF 14 million • High first-half sales (CHF 91 million) • Only CHF 29 million in second half• Drastic structural adjustment

(already partially implemented on 31 December)2002• Breakeven at CHF 80 million• Intensive preparation so as to be able to deal with

the upturn with a minimum of additional personneland friction costs (supply chain management)

• So far no visibility for market-driven volume recovery

2003• Break-even point not reached• Market share held despite declining market• Fundamental innovation• Marked increase in new orders

41

Gross revenues

CHF m

1999 2000 2001 2002 2003


0

-8

Operating result *


5

0

-9

61

100

208

120

74

26


27


Consolidated financial statements of the Schweiter Technologies Group

Consolidated balance sheet as at December 31

Consolidated income statement

Consolidated cash flow statement

Change in consolidated shareholders' equity

Notes to the consolidated financial statements

Principles of consolidation and valuation

Segment information by divisions and regions


Report of the Group auditors

28

29

30

31

32 – 60

32 – 39

40

42 – 60

61

28


Consolidated balance sheet as at December 31

Assets (in CHF 1000s)

Current assetsCash and cash equivalentsTrade receivablesReceivables from current income taxesOther receivablesPrepaid expenses and accrued income Inventories and work in progressTotal current assets

Fixed assetsProperty, plant and equipmentLong-term receivables Participating interests in associated companiesDeferred income tax assetsIntangible assetsTotal fixed assets

Total assets

Liabilities (in CHF 1000s)

Short-term liabilitiesShort-term interest-bearing liabilitiesCommission paymentsTrade liabilitiesOther liabilitiesProvisions, accruals and deferred incomeCurrent income taxesTotal short-term liabilitiesLong-term interest-bearing liabilitiesDeferred income tax liabilitiesProvisionsPension obligations Total long-term liabilitiesTotal liabilities

Shareholders’ equityShare capitalTreasury sharesPremiumProfit reservesNet income/ loss for the yearOCI (other comprehensive income)Currency translation differencesTotal shareholders' equity

Total liabilities

12

3

4

6

7328

9

1012

14331615

18

2003

48 89955 351

101810 211

94050 865

167 284

27 1881561

-5 9845 826

40 559

207 843

2 2015 593

18 15210 70417 6673 205

57 5226 2071 543

10 1482 973

20 87178 393

14 437- 2 391

107 381221

17 733505

- 8 436129 450

207 843

%

80.5

19.5

27.7

10.037.7

62.3


2002

48 21655 995

-9 2972 910

60 567176 985

34 387858

-17986 200

43 243

220 228

30 9617 000

13 4599 129

16 2042 780

79 53310 676

129611 3812 889

26 242105 775

14 437-

107 38148 886

- 48 665473

- 8 059114 453

220 228

%

80.4

19.6

36.1

11.948.0

52.0


Consolidated income statement

(in CHF 1000s)

Gross revenuesSales deductionsNet revenuesChange in inventories of semi-finished and finished goodsOperating performance

Cost of materialsPersonnel expensesDevelopment expensesOther operating expensesOther operating incomeDepreciationOperating profit before amortization of goodwill

Amortization of goodwill / impairment lossOperating profit / loss after amortization of goodwill

Financial incomeFinancial expensesIncome before taxes

Income taxesNet income/loss for the year

Earnings/ loss per share before dilution (in CHF)

Earnings/ loss per share after dilution (in CHF)

21

2323242526

27

2930

31

35

2003

269 973- 10 265259 708

1 680261 388

- 125 191- 65 757 - 16 617- 34 160

2 430- 4 52317 570

- 35317 217

7 357- 6 68717 887

- 15417 733

12.3012.30


%

103.3- 3.999.40.6

100.0

- 47.9- 25.2- 6.3

- 13.10.9

- 1.76.7

- 0.16.6

2.8- 2.5

6.9

- 0.16.8

29

2002

322 448- 15 437307 011- 22 004285 007

- 136 030- 81 110 - 18 215- 36 113

113- 7 1706 482

- 46 660- 40 178

3 453- 6 217

- 42 942

- 5 723- 48 665

- 35.10- 35.10

%

113.1- 5.4

107.7- 7.7

100.0

- 47.7- 28.4- 6.4

- 12.70.0

- 2.52.3

- 16.4- 14.1

1.2- 2.2

- 15.1

- 2.0- 17.1

30


(in CHF 1000s)

Income before taxesDepreciation and amortization of goodwillChange in provisions and pension obligationsProfit / loss on sales of property, plant and equipment Interest incomeInterest expensesOperating profit before adjustment of net current assets

Decrease in trade receivablesChange in other receivables and accrualsDecrease in inventories and work in progressChange in trade liabilitiesChange in other liabilities and deferralsCash flow from operating activity

Interest paidIncome taxes paidNet cash flow from operating activity

Purchase of intangible assetsPurchase of investment in subsidiariesRepayment of purchase price liability for investment in subsidiariesShare in result of non-consolidated participationsPurchase of property plant and equipmentSale of property plant and equipmentInterest receivedCash flow from investment activity

Change in long-term receivablesDecrease in leasing liabilitiesRepayment of long-term loansRepayment of short-term loansPurchase/sales of treasury sharesCurrency translation differences on fixed assetsCash flows from financing activity

Currency exchange differences on cash and cash equivalents

Change in cash and cash equivalents

Cash and cash equivalents as at January 1

Cash and cash equivalents as at December 31

Consolidated cash flow statement

2003

17 8874 876

- 1 499- 2 085

- 7271117

19 569

647- 27

9 1022 8782 864

35 033

- 1 095- 3 43430 504

----

- 3 4419 313

6626 534

- 762- 1

- 4 485- 29 039- 2 391

-- 36 678

323

683

48 216

48 899

18


2002

- 42 94253 830- 1130

--12372 513

11034

12 90910 45740 522- 8 813

- 12 15953 950

- 3 770- 3 79346 387

- 16- 898

- 30 20774

- 3 601612

1325- 32 711

712- 517

- 1392- 31258

56- 271

- 32 670

-256

- 19 250

67 466

48 216

31


Balance as at Dec. 31, 2001

Reclassification of unappropriated reserves from premium

Combination of profit reserves/profit carried forward

Balance as at Jan. 1, 2002

Capital increaseNet lossSale of treasury sharesForeign currency differencesChange in market value

of cash flow hedges


Net incomePurchase of treasury sharesForeign currency differencesChange in market value

of cash flow hedges


Share capitalProfit

reserve Total

11924

11924

2 513

14437

14437

71608

-1071

70537

36844

107381

107381

127123

-

-

127123

39357-48665

56-4196

778

114453

17 733-2391- 377

32

129450

(in CHF 1000s)

Currencytranslationdifference

-3863

-3863

-4196

-8059

- 377

-8436

Profit car-ried forwardPremium OCI

43363

-43363

0

0

0

4450

1071

43363

48884

-486652

221

17 733

17954

-305

-305

778

473

32

505

Treasuryshares

-54

-54

54

0

-2391

-2391

Change in consolidated shareholders' equity

32

General

The Schweiter Technologies Group preparesits consolidated financial statements in accordancewith the principles of the International Financial Reporting Standards (IFRS), previously known asthe International Accounting Standards (IAS). In addition, it also presents the information requiredby Swiss company law.

The annual financial statements are presentedin Swiss francs, as the most important group unitsoperate from Switzerland and the majority of theGroup's transactions are conducted in Swiss francs.

Basis of consolidation

The Group's consolidated financial statements,comprising the balance sheet, income statement,cash flow statement and change in consolidated shareholders' equity are based on the audited annual statements of the companies included as atDecember 31, 2003 and December 31, 2002. Thestatements of the individual companies, which follow local requirements and customary practices,have been adapted to IFRS on the basis of standardGroup-wide structuring and valuation principlesand have been combined into the consolidated financial statements.

Principles of consolidation

The consolidated annual accounts of Schwei-ter Technologies Group encompass all companiesin which the Group holds more than 50% of votingrights or exercises de facto control in some otherform. Newly acquired companies are consolidatedfrom the date of acquisition. The results of compa-nies disposed of are included up until the date ofthe sale.

Companies in which the Group holds morethan 20% of voting rights, but not more than 50%,are reported according to the equity method, pro-vided effective control is not exercised in someother form. Thus, they are reported in the balancesheet at acquisition value, corrected for dividendpayments and the Group's shares in the accumulatedprofit or loss after the acquisition.

Companies in which the Group holds less than20%, are reported in the balance sheet at fair value. Changes in value are reported under Groupreserves without any impact on the income state-ment and are only transferred to the income state-ment when sold (treated as financial assets held forsale in accordance with IAS 39). If fair value cannotbe determined reliably, assets are valued at acqui-sition costs. Any impairments are taken into account by decreases in value with an impact on theincome statement.

The capital consolidation is performed basedon the purchase method. The assets and liabilitiesof newly acquired companies are stated at their fairvalue at the time of acquisition. Minority interestsare minority shareholders' share in total assets minus liabilities.

In performing the consolidation, all transac-tions and balances between the consolidated com-panies are eliminated. The annual accounts includ-ed in the consolidation are prepared according tostandard valuation principles as at December 31.



33


Segment information

The segment information is primarily presented bydivisions and in second place by regions – brokendown into Europe, Americas, Asia and the rest ofthe world.

The Schweiter Technology Group is subdivided into four divisions which form the basis for the primary format of the segment reporting. Theseare:– SSM Textile Machinery– Satis Vacuum– Ismeca Automation– Ismeca Semiconductor

“Other/eliminations” includes central manage-ment and financial functions of Schweiter Techno-logies AG (Holding) and eliminations from the con-solidation.

Sales between the individual divisions are sett-led at arm’s length conditions.

Changes in the scope of consolidation

No changes such as acquisitions or disinvest-ments took place in 2003.

Other changes:

Establishment of SSM (Zhongshan) Ltd., Zhong-shan, China.

As part of the legal separation of the Semi-conductor and Automation divisions, Ismeca Hol-ding SA was split up into Ismeca SemiconductorHolding SA and Ismeca Automation Holding SA. Inaddition, the automation activities were hived offfrom Ismeca Europe SA and incorporated into thenewly established company Ismeca Europe Auto-mation SA.

Merger of Ismeca Group Management SA withIsmeca Semiconductor Holding SA.

Changes in the scope of consolidation in 2002:

In January 2002, the remaining 22.7% stake inIsmeca Holding SA La Chaux-de-Fonds was acqui-red from CREDIT SUISSE Group by means of a share swap (see 34 Purchase of investments in sub-sidiaries and 18 Share capital). In this connection,on March 15, 2002 a total of 251 275 Schweiter shares were reissued against a non-cash capital con-tribution. This transaction also includes payment of the 3.75% stake in Ismeca Holding, which was likewise acquired by means of a share swap and non-cash capital contribution rather than by cashpayment as originally agreed. The whole trans-action was recorded at market values. The non-cashcapital contribution gave rise to an increase in theshare capital by CHF 2.5 million and a premium ofCHF 36.8 million. At the same time, the minorityinterests decreased from CHF 28.4 million to zero.

34


Share capital in 1000s

CHF 14 437

CHF 6000

CHF 100

EUR 51

EUR 25

USD 200

CHF 5000

CHF 500

EUR 5165

EUR 102

USD 0.001

GBP 0.001

SGD 100

CHF 500

Company

Schweiter Technologies AGHorgen, Switzerland

SSM Schärer Schweiter Mettler AGHorgen, Switzerland

SSM Vertriebs AGBaar, Switzerland

SSM Stähle Eltex GmbHReutlingen, Germany

Hacoba Spultechnik GmbHWuppertal, Germany

SSM (Zhongshan) Ltd.Zhongshan, China

Satis Vacuum Holding AGBaar, Switzerland

Satis Vacuum Industries Vertriebs AGBaar, Switzerland

Satis Vacuum Industries S.p.a.Milan, Italy

Satis Vacuum Deutschland GmbHErlensee, Germany

Satis Vacuum of America Inc.Groveport, Ohio, USA

Satis Vacuum (UK) Ltd.Bolton, UK

Satis Vacuum Asia Pte Ltd.Singapore

Satis Photonics AGHorgen, Switzerland

Shareholding

-

100 %

100 %

100 %

100 %

100 %

100 %

100 %

100 %

100 %

100 %

100 %

100 %

100 %

Purpose

Holding company

Production and distribution

Distribution




Holding company

Head office and distribution


Trading and distribution

Distribution

Distribution

Distribution


Scope of consolidation

The following companies were fully consolidated as at December 31, 2003.


35


Share capital in 1000s

CHF 1400

CHF 500

GBP 1

EUR 40

USD 100

CHF 5000

CHF 1100

EUR 26

USD 100

USD 1

USD 1

MYR 2500

HKD 150

Company

Ismeca Automation Holding SALa Chaux-de-Fonds, Switzerland

Ismeca Europe Automation SALa Chaux-de-Fonds, Switzerland

Ismeca (UK) Ltd.Cheltenham, UK

Ismeca France S.à.r.l.Besançon, France

Ismeca USA Automation Inc.Carlsbad, CA, USA

Ismeca Semiconductor Holding SALa Chaux-de-Fonds, Switzerland

Ismeca Europe Semiconductor SALa Chaux-de-Fonds, Switzerland

Ismeca GmbHDeckenpfronn, Germany

Ismeca USA Semiconductor Inc.Carlsbad, CA, USA

CDF Holding Inc.Delaware, DE, USA

Ismeca Properties, Inc.Carlsbad, CA, USA

Ismeca Malaysia Sdn. Bhd.Melaka, Malaysia

Ismeca Asia, Ltd.Aberdeen, Hong Kong

Shareholding

100 %

100 %

100 %

100 %

100 %

100 %

100 %

100 %

100 %

100 %

100 %

100 %

100 %

Purpose

Holding company


Distributionand services



Holding company




Holding company

Real estate



36



USAEuro zoneUKSingaporeMalaysiaHong Kong

DollarEuroPoundDollarRinggitDollar

USDEURGBPSGDMYRHKD

1111

1001

The following exchange rates were applied (in CHF)

Year-end rate 31.12.for the balance sheet

Year-average ratefor the income statement

2003

1.241.562.210.73

32.750.16

2002

1.391.452.430.80

36.520.18

2003

1.351.522.200.77

35.430.17

2002

1.561.472.340.87

41.030.20

Gross revenues

Gross revenues include all invoiced sales of machines, spare parts, services and rental income.Revenues from construction contracts are valuedby the percentage of completion (POC) method.The percentage of completion is based on the ratio of costs incurred (i.e. by the reference date)to the overall anticipated costs of the order.

Net proceeds from revenues and realization of income

Net proceeds from revenues includes all in-voiced sales to third parties after deduction of value added tax, quantity discounts, commissions, losses on bad debts, other sales deductions and thecost of carriage, insurance and packaging. Incomeis accounted for on delivery or rendering of the service respectively.

Conversion of foreign currencies

The annual statements of foreign subsidiariesare prepared in the corresponding national cur-rencies and converted into Swiss francs for consol-idation purposes. The balance sheet is translated atyear-end exchange rates, and the income statementat the average exchange rate for the financial year.Resulting conversion differences are booked direct-ly under shareholders' equity and therefore have noimpact on the income statement. Other exchangerate differences, including those arising from

foreign currency transactions in connection withnormal business activities, are charged or creditedto the income statement.

Financial instruments

The financial instruments used are recorded onthe balance sheet as of the trading date.

Derivative financial instruments are recordedin the balance sheet at market values in accordancewith IAS 39. The Group mainly uses forwardexchange contracts as a means of hedging foreigncurrency risks. A forward exchange contract usedto hedge an underlying transaction, in particular anongoing order or a trade receivable denominated ina foreign currency, constitutes a fair value hedge. Inthis case the changes in market value arising fromthe hedging transaction and the underlying trans-action are taken to income under consideration ofdeferred taxes, and the market values are stated together with the underlying transaction; the net-ted-out effect is reflected in the result. A cash flowhedge exists in particular where exchange rate hedging transactions are concluded in advance forfuture orders. The change in market value is reported in shareholders' equity without affectingthe result (OCI, other comprehensive income/ex-pense) and under consideration of deferred taxes,and the market value is reported under accruals anddeferrals.

37


Credit risk

There are no cluster risks relating to trade accounts receivables. To minimize default risks,where appropriate additional collateral (e.g. irre-vocable confirmed documentary credits, bank guarantees, credit risk insurance etc.) is agreedupon based on specific industry, country and customer analyses. The Group only has bank accounts with first-class banks. The Group carriesout constant checks on customers' creditworth-iness and does not have any major concentrationsof default risks.

Trade receivables

The reported value corresponds to the in-voiced amounts less value adjustments for provi-sion for bad debts.

Inventories and work in progress

Purchased goods are reported at acquisitioncosts, self-produced goods are reported at production costs. If the net sales value is lower, corresponding value adjustments are made. Theproduction costs include the full costs of the material, the proportionate manufacturing costsand the proportionate general overheads.

Inventories are valued using the weighted average costs method or the FIFO method. For non-marketable parts held in inventory an appropriatevalue adjustment was formed on the basis of fre-quency of turnover.

A corresponding value adjustment is perform-ed for customer-specific, finished machines which remain in inventory for longer than one year and for all machines kept for demonstration purposes.Interim profits on intra-Group supplies are elimi-nated through the income statement.

Work in progress: Where the figures for construction contracts can be reliably estimated inadvance, sales and production costs are taken tothe income statement in accordance with the per-centage of completion (POC) method. Changes toorder specifications and additional costs agreedwith the customer will be factored in accordingly.

Market risks and risk managementBasic principles

The market risks to which the Group is exposed mainly relate to interest rates, foreign currencies and counterparty default. The Board ofDirectors is responsible for overseeing the Group'sinternal controlling systems which monitor, but cannot rule out, the risk of inadequate business performance. These systems provide appropriate,though not absolute, security against significant inaccuracies and material losses. Management is responsible for identifying and assessing risks thatare of significance for the division in question.

In addition to quantitative approaches and formal guidelines – which are only part of a com-prehensive risk management approach – it is alsoconsidered important to establish and maintain acorresponding risk management culture.

Financial instruments should be considered inparticular to be bank balances, receivables, tradeliabilities and interest-bearing liabilities. The bookvalue of the bank balances, receivables and tradeliabilities is largely the same as their market value.Most are denominated in Swiss francs. Smaller amounts for the settlement of day-to-day businessare denominated in foreign currencies.

Risk of changes in interest rates

The risk of changes in interest rates primarilyrelates to long-term interest-bearing liabilities. Inthe case of mortgage loans, interest rate risks areminimized by staggered maturities and fixed interest rates. No derivative financial instrumentsare used to hedge against the risk of changes in interest rates.

Foreign currency risk

As the Group sells products and services in foreign currencies, it is exposed to fluctuations inexchange rates. The bulk of its sales are denomi-nated in Swiss francs. Forward exchange transac-tions are used to hedge exchange rate risks. Theseinstruments are not used for speculative purposes.

38


Property, plant and equipment

Land is reported in the balance sheet at acqui-sition cost. Value adjustments are made for anydecrease in value which has occurred. Buildings, machinery, vehicles and operating equipment arereported at acquisition costs minus accrued de-preciation. Depreciation is calculated using the linear method over the following foreseeable periods of use:• Buildings: 40 years • Conversions: 10 years orthe duration of the rental agreement • Fixturesand fittings: 8 to 10 years • Machines: 5 to 10 years • Computer systems and associated operating software: 3 to 5 years • Vehicles: 3 to 4 years• Furniture: 8 to 10 years • Rented facilities for theduration of the rental agreement.

Development costs

Research and development costs are chargedto the current year's income statement.

Income tax

Taxes incurred on the basis of the business results will be accrued regardless of when such pay-ment obligations become due and allowing for anytax-deductible losses carried forward. In addition,provisions for deferred taxes will be made. Suchprovisions are the result of differences between thestandard Group valuation and the tax valuation inthe individual statements which lead to shifts in thetiming of taxation.

The calculation is made according to the liability method. At the same time, no provisionsare made for positions in which no recovery is expected in the foreseeable future. Calculation isbased on the maximum local tax rate on the balance sheet date.

No provisions are made for taxes which wouldbe incurred on the distribution of retained profitsof subsidiaries, except in cases in which a distribu-tion is likely to be forthcoming in the foreseeablefuture or has been decided upon.

Goodwill

Goodwill is the difference between the acqui-sition price and the pro-rated net assets (fair value)of the acquired company at the time of acquisition.

Goodwill is capitalized and written down overa useful life of 20 years maximum. Residual good-will is subjected yearly to an impairment test and,where necessary, written down further.

Decrease in the value of assets– impairment

On each balance sheet date, an assessment ismade of whether assets that account for significantsums show signs of decreasing in value (impair-ment). If so, the recoverable value is defined as thehigher of the estimated net market value and theascertained value in use. The value in use corre-sponds to the cash value of the estimated futurecash flow. If the recoverable value thus determinedis lower than the current book value, the decreasein value is taken to income (impairment loss). Except in the case of a decrease in the value of good-will, any recorded decrease in value that ceases to be justified is written back and the respectiveamount taken to the income statement.


39


Benefits due to employees Pension plans and employee stock option plan

Within the Group, a number of different pension plans are in place in compliance with therelevant legal requirements. The assets of most ofthese pension plans are reported separately underlegally independent pension institutions. In addi-tion to salary-dependent employer's contributions, some pension plans also require employees to paycontributions. In the case of the defined contribu-tion plans, the employer's contributions are takento the income statement.

The pension plans in Switzerland are based onthe BVG principle (BVG = Federal Law on Occu-pational Retirement, Survivors' and Disability Pension Plans) and for purposes of IAS 19 shouldbe described as defined benefit plans since the actuarial and investment risks are not borne solelyby the employee. The pension obligations and pen-sion expenses arising from these pension plans aretherefore determined by an independent actuaryusing the projected unit credit method. Actuarialcover shortfalls or surpluses are disclosed in the

notes and if they exceed 10% of the pension obli-gation or the market value of the pension plan assets, whichever is greater, they are taken to income throughout the employee's anticipated re-maining period of employment until retirement.Surpluses are only stated if the employer can usethem for future reductions in contributions.

An employee stock option plan was in placewith a view to securing the long-term loyalty of theGroup's senior executives and providing them withincentives. Under this plan, employees were issuedwith options – most recently in 2000. The fair value of the employee options was not charged tothe income statement either when the option wasissued or when it was exercised. The exercise prices of the options have been set at levels higherthan the current share price; the exercise prices ofthe options have not been adjusted. All remainingoptions expired at the end of March 2003. There isno new option plan.


40

Segment information broken down by divisions and regions

Regions

Gross revenues

Assets

Capital expenditure

Europe Americas Asia Other Group

118.2

187.4

4.2

270.0

207.8

6.0

4.4

-

-

80.6

8.1

0.1

66.8

12.3

1.7


Satis Vacuum

Ismeca Automation


Other / eliminations Group

109.7

-

104.2

-0.7

-

20.1

19.3%

-

20.1

0.660.134.9

270.0

-

261.4

-4.5

0.8

17.6

6.7%

-0.4

17.2

0.7

17.9

-0.2

17.7

6.0207.878.4

-0.3

-0.5

-0.3

-

-

-

-

-

-

--16.8-17.2

61.1

0.4

58.8

-1.8

0.4

-7.6

-12.9%

-0.4

-8.0

0.590.721.1

34.3

0.1

37.6

-

0.4

-3.4

-9.0%

-

-3.4

-23.69.4

65.2

-

61.1

-2.0

-

8.5

13.9%

-

8.5

4.950.230.2

2003 (in CHF millions)

Divisions

Gross revenuesthereof gross revenues

between divisions

Operating performance

DepreciationValue reinstatement on prop-

erty, plant and equipment

Operating result before amortization of goodwill


Amortization of goodwill

Operating result after amortization of goodwill

Financial income/expenses

Income before taxes

Income taxes

Net income for the year

Capital expenditureAssetsLiabilities

26

27

41


Regions

Gross revenues

Assets

Capital expenditure

Europe Americas Asia Other Group

140.3

192.8

1.8

322.4

220.2

3.6

-

-

-

111.0

10.6

0.2

71.1

16.8

1.6


Satis Vacuum

Ismeca Automation


Other / eliminations Group

129.0119.3

-1.0

20.0

16.7%

-

20.0

0.248.934.2

322.4285.0

-7.2

6.5

2.3%

-46.7

-40.2

-2.8

-43.0

-5.7

-48.7

3.6220.2105.8

0.40.4

-

-0.4

-

-0.4

-2.6

18.6

73.561.5

-4.7

-9.5

-15.5%

-25.6

-35.1

0.697.821.7

50.345.6

-0.5

-4.8

-10.5%

-21.1

-25.9

0.428.85.1

69.258.2

-1.0

1.2

2.1%

-

1.2

2.442.126.2

2002 (in CHF millions)

Divisions

Gross revenuesOperating performance

Depreciation

Operating result before amortization of goodwill


Amortization of goodwill

Operating result after amortization of goodwill

Financial income/expenses

Loss before taxes

Income taxes

Loss for the year

Capital expenditureAssetsLiabilities

26

27

42



2 Trade receivables (in CHF 1000s) 2003 2002

Total trade receivables 59 989 60 838– minus bad debt allowances - 4 638 - 4 843Total net 55 351 55 995

The average time taken for the settlement of receivables in 2003 amounts to 81 days (previous year 76 days)

5

The net value of the inventories and work inprogress is after value adjustments of CHF 41.8 million (previous year CHF 41.7 million).

No value reinstatements were recorded as income. No inventories are encumbered by rights of lien.

3 Other receivables (in CHF 1000s) 2003 2002

Receivables from taxes (value added tax, withholding tax, etc.) 3 759 6 026Receivables relating to construction contracts 463 864Other receivables 5 989 2 407Total 10 211 9 297

4 Inventories and work in progress (in CHF 1000s) 2003 2002

Raw materials and parts 26 617 30 111Semi-finished goods and work in progress 14 875 17 924Finished goods at production costs 6 971 11 410Finished goods at net disposal costs 2 402 1 122Total 50 865 60 567

1 Cash and cash equivalents by currencies (in CHF 1000s) 2003 2002

CHF 18 161 26 250EUR 9 797 13 766USD 18 399 6 844Other 2 542 1 356Total 48 899 48 216

43


3

10

5 Construction contracts (in CHF 1000s) 2003 2002

Work in progress relating to construction contracts as reported in the balance sheet 1 554 103

Sales booked under construction contracts during the year 20 679 37 079

Accrued costs and profits on construction contracts outstanding at the end of the year recorded pro rata (less losses) 8 147 2 440

Advances received on open construction contracts at the end of year - 10 683 - 1 576Total - 2 536 864

Total construction contracts revenue recognized during the year,reported in balance sheet under other assets 463 864

Construction contracts with deficit balance to customers,reported in balance sheet under other liabilities - 2 999 -

- 2 536 864

There are no payments withheld by customers.

44



75 7146 029

-12 7060

-53

68 984

-41327-4 5234 235

00

-181

-41796

34 387

27188

67 44217 708

60

Land andbuildings

Instal- lations

Total2002

MachineryTools Furnishings

Computerequipment Vehicles

Total2003

35 52111

-7 416-

-148

27 968

-9 207-6911242

--

-37

-8 693

26 314

19 275

4 08835

-143-1

3 981

-3 355-219142

--3

-3 429

733

552

811743 601

-5 5360

-3 525

75 714

-41324-5 0184 783

-1 3260

1 558

-41327

39 850

34 387

86 70023 798

97

12 5864 625

-2 34328

158

15 054

-8 147-1942

518-

-11-163

-9 745

4 439

5 309

10 546386

-1650-3486

9 334

-9 219-3421265

-17

-126

-8 405

1 327

929

10 728802

-9266

-149

10 461

- 9 569-1024

840-

-6143

-9 616

1159

845

2 245170

-228-

-1

2 186

-1830-305228

--

-1

-1908

415

278

6 Property, plant and equipment

A property sale in 2003 resulted in value rein-statements amounting to CHF 380 000 for IsmecaSemiconductor and CHF 380 000 for Ismeca Auto-mation which are reported under Profit on sale ofproperty, plant and equipment.

Fixed-asset summary (in CHF 1000s)

Acquisition valuesBalance as at January 1AdditionsDisposalsTransfersExchange rate differences

Balance as at December 31

Accumulated depreciationsBalance as at January 1Depreciation for the yearDisposalsImpairmentTransfersExchange rate differences


Net book valueBalance as at January 1


Insurance valuesNet book value of pledged land and buildingsLeasing obligations for property, plant and equipment reported on balance sheet

3813

The impairment charge of CHF 1.326 million in 2002 relates to Ismeca Semiconductor (CHF676 000) and Ismeca Automation (CHF 650 000).

45


The main investments in subsidiaries held directly or indirectly by the Schweiter TechnologiesGroup are listed above. These are long-term investments in subsidiaries and associates which are

7 Investments in associated companies (in CHF 1000s) 2003 2002

Elpo AG, Bäretswil, Switzerland Share of equity 24% - -Other - -Total 0 0

Book value as at January 1 - 74Share of loss belonging to non-consolidated participation - - 74Book value as at December 31 0 0

not fully consolidated. Currency and business-related reductions/ increases in value are taken into account by the equity valuation method.

8 Intangible assets (in CHF 1000s) Goodwill Other Total

Acquisition valuesBalance as at January 1 159 473 192 159 665Additions - - 0Disposals - - 130 - 130Balance as at December 31 159 473 62 159 535

Accumulated amortizationsBalance as at January 1 -153 295 - 170 -153 465Amortization - 353 - - 353Disposals - 109 109Balance as at December 31 -153 648 - 61 -153 709

Net book value as at December 31 5 825 1 5 826

The Ismeca participation and goodwill weresubjected to impairment tests on December 31,2002 and 2003 (see 27 Goodwill amortization). This did not result in any further impairment lossin 2003. In 2002, an impairment loss of CHF43 804 000 was reported in addition to the ordi-

nary goodwill amortization of CHF 2 856 000. The remaining goodwill as at December 31,

2003 relates to Ismeca Semiconductor and amounts to CHF 5.8 million with a planned amor-tization over a further 16.5 years.

46



10 Other liabilities (in CHF 1000s) 2003 2002

Unredeemed dividend coupons 65 65Arrears toward staff pension schemes 5 186Liabilities from construction contracts 2 999 -Prepayments received from customers 4 594 6 346Other liabilities 3 041 2 532Total 10 704 9 129

5

9 Short-term interest-bearing liabilities (in CHF 1000s) 2003 2002

Current accounts with banks 1 812 6 437Bank loans due within one year - 11 088Mortgages due within one year 354 551Other short-term liabilities toward banks 2 166 18 076Financial leasing contracts, due within one year 35 72Shareholder loans - 12 813Total 2 201 30 961

Breakdown of short-term liabilities toward banks by currencies with average interest rates:

Actual Actual December 31, 2003 interest rates December 31, 2002 interest rates

CHF 135 1.57 % CHF 13 651 1.93 %CHF 1 812 2.10 % EUR 3 815 5.50 %CHF 135 5.75 % USD 610 4.56 %EUR 84 2.18 %

2 166 18 076

1320

11 Liabilities arising from acquisitions (in CHF 1000s) 2003 2002

Discounted liabilities as at January 1 - 36 218Recorded financial expenses arising from discount facility - 461Payment during the year under review - - 30 207Recalculation of purchase price commitment - 898Writeback of Ismeca's 3.75% liability (in capital increase) - - 7 370Total 0 0

12 Provisions, accruals and deferred income (in CHF 1000s) 2003 2002

Personnel costs (holidays / flexitime / overtime / bonuses / etc.) 7 974 8 367Cost of materials / overheads 3 934 2 289Miscellaneous 5 759 5 548Total 17 667 16 204

47


Breakdown of long-term loans and leasing obligations by currencies with average interest rates

Actual Actual December 31, 2003 interest rates December 31, 2002 interest rates

CHF 255 1.57 % CHF 390 1.22 %CHF 255 5.75 % CHF 390 1.58 %CHF 3 000 3.25 % CHF 3 000 3.25 %CHF 2 500 3.63 % CHF 2 526 3.63 %CHF 25 7.00 % USD 4 131 6.90 %EUR 172 2.18 % EUR 3 5.00 %

EUR 236 4.70 %Total 6 207 10 676

The mortgage loans are secured by encumbrance on real property (see 38 Right of lien).

14 Long-term interest-bearing liabilities (in CHF 1000s) 2003 2002

Long-term bank loans 510 240Mortgage loans 5 672 10 411Long-term liabilities toward banks 6 182 10 651Finance leasing obligations, due after one year 25 25Total 6 207 10 676

The maturities of the long-term liabilities toward banks are as follows:– 1 to 2 years 442 649– 2 to 5 years 5 740 7 208 – more than 5 years - 2 794Total 6 182 10 651

914

38

13

13 Obligations arising from finance leasing (in CHF 1000s) 2003 2002

Obligations arising from finance leasing (nominal), due in:– one year 37 76– 2 to 5 years 26 26Total nominal value 63 102

less future financial expense - 3 - 5Total cash value of minimum leasing obligations 60 97

Reporting on balance sheet by due date– in one year (in short-term interest-bearing liabilities) 35 72– in 2 to 5 years (in long-term interest-bearing liabilities) 25 25Total cash value of minimum leasing obligations 60 97

48



15 Pension plans

Staff pension obligations

The Group has a series of pension plans whichcomply with the relevant legal circumstances. These plans provide benefits in the event of death,disability, retirement or termination of employ-ment. In the case of some of these pension plans,employees have to pay contributions which are supplemented by corresponding contributionsfrom the Group. They are financed in conformitywith local legal and tax regulations.

Defined benefit plans

The most important Group units with definedbenefit plans are domiciled in Switzerland, Germany and Italy. The pension benefits are basedon the employee's years of service, age and salary. Pension funds’ assets in Switzerland have been splitoff into a separate foundation and can not accrueback to the employer.

The pension liabilities of the defined benefitplans were calculated using the projected unit credit method. The last valuation was performedon December 31, 2003.

The International Financial Reporting Inter-pretations Committee (IFRIC) has ruled that theseverance payments prescribed by law in Italy(“Trattamento di fine rapporto” – “TFR”) are to betreated as pension obligations. As of December 31,2002, these TFR have therefore been retroactivelyreclassified from other provisions, causing an in-crease of CHF 1967 000 in pension obligations.

Defined contribution plans

The most important Group units with definedcontribution plans are domiciled in the USA, Malaysia, Hong Kong and France.

Employer contributions under these plansamounted to CHF 208 000 in 2003 (CHF 157 000in 2002).

Shortfalls

In Switzerland, compulsory and extended pen-sion benefits for Schweiter Group employees are regulated through two foundations. On 31 Decem-ber 2003, the annual financial statement of theSchweiter foundation showed a surplus of around5% and that of the Ismeca foundation a shortfall ofaround 3%. The Board of Trustees of the Ismeca foundation has already taken measures to eradicatethe shortfall. On the one hand, the level of interestpayable on the retirement savings capital has beenadjusted, while on the other hand 1.5% of insuredsalaries is to be used as a contribution toward therestructuring rather than a savings contribution. As a contribution toward the restructuring, the employer will be waiving its claim to a share of surpluses arising from risk pooling and the dailysickness allowance contract. There are no plans for more extensive measures on the part of the employer.

The pension obligations and net pension ex-penditure in the consolidated financial statementswill be determined in accordance with the Interna-tional Financial Reporting Standards (IFRS). Underthese rules, the shortfall for these two plans amounted to CHF 3.4 million in 2003 (CHF 7.9 mil-lion in 2002). In calculating the obligations, it is necessary to take account of various assumptionsregarding salary developments, pension indexationand staff turnover. Consequently, the shortfall can-not be compared with that shown in the annual financial statements of the foundations. For exam-ple, the effect of wage trends is financed throughfuture employee and employer's contributions.

49


The weighted actuarial assumptions can be summarized as follows: 31.12.03 31.12.02

Annual discount interest rate 3.76 % 3.77 %Long-term annual yield 4.50 % 4.50 %Annual wage increases 1.98 % 1.98 %Annual pension adjustments 0.94 % 0.72 %

2003 2002

Employer's contributions to defined contribution plans (in CHF 1000s) 208 154

Net pension expenditure for the period (in CHF 1000s) 2003 2002

Pension entitlement acquired 4 965 5 400Interest paid on future pension entitlement 3 314 3 509Anticipated income from assets - 3 674 - 4 068Amortization of losses 179 23Additional expense 423 382Restructuring expenses - 267Employee contributions - 2 498 - 2 714Net pension expenditure for the period 2 709 2 799

Effective income from assets 6 783 - 3 130

Status of the pension schemes (in CHF 1000s) 31.12.03 31.12.02

Pension obligations covered by segregated assets 90 325 91 059Pension assets - 86 890 - 83 157Cover shortfall 3 435 7 902Pension obligations not covered by pension assets 3 032 2 834Losses not yet amortized - 3 494 - 7 847Pension obligations reported on the balance sheet 2 973 2 889

Development of pension obligations reported on the balance sheet (in CHF 1000s) 2003 2002

Pensions obligations as at January 1 2 889 860Net pension expenditure for the period 2 709 2 799Employer’s contributions - 2 830 - 2 726Reclassification from other provisions (“TFR”) - 1 967Exchange rate differences 205 - 11Pension assets at market values as at December 31 2 973 2 889

50



Balance as at January 1Foreign currency differencesConsumption with

neutral impact on incomeUnused amounts

reversed and released to incomeReclassification

of severance payments (“TFR”)Additional provisions

charged to income


Restructurings

Total 2002

14 575-94

-7 791

-1662

- 1967

8 320

11 381

16 Provisions (in CHF 1000s) Other

3 428-

-2 003

-656

-

2 309

3 078

ProjectsGuarantees

13354

-1039

-300

-

-

0

2581

-259

-

-

-

0

6 360167

-3 339

-775

-

4 657

7 070

The provision for guarantees was formed forrepairs and the replacement of defective products.It is based partly on a cost estimate derived fromspecific known facts and partly on empirical valuesfor follow-up developments of new launched products.

Other provisions comprises business eventswith specific, quantifiable risks in relation to whichit is not known when the associated costs will beincurred as well as provisions for materials risks under master agreements. The materials risks arebased on empirical values and purchase commit-ments to suppliers as of December 31, 2003.

17 Minority interests (in CHF 1000s) 2003 2002

Minority interests as at January 1 - 28 372Decrease in minority interest - - 28 372Total 0 0

34

At the beginning of January 2002, SchweiterTechnologies took over the remaining 22.7% stakein the Ismeca Group by means of a capital increase

with a contribution in kind drawing on the autho-rized capital. In this connection, 251 275 shares were issued.

Total2003

11381172

-6 640

-1731

-

6 966

10 148

15


51

There were no capital changes in 2003.

Capital increases in 2002: Under the capital increase of March 15, 2002, 251 275 new shares were created from the authorized capital and issuedagainst a contribution in kind in the form of the remaining Ismeca shareholdings (22.7% plus 3.75%in place of the cash payment originally agreed upon)by CREDIT SUISSE Group companies. Moreover,25 400 shares created from the conditional capitalfor employee options exercised in 2001 were registered. The latter 25 400 shares were countedtoward the share capital as of December 31, 2001,and deducted from the conditional capital. The contribution in kind was valued at CHF 155 perSchweiter share, which resulted in a premium ofCHF 36.8 million.

The change in consolidated shareholders' equity is presented on page 31.

Treasury shares in 2003: 13 476 treasury shareswere held as of December 31, 2003. They werepurchased on the stock exchange in November2003 for an average price of CHF 177.40. They arevalued at their acquisition price.

Treasury shares 2002: At the beginning of 2002,139 shares were issued to employees at a price ofCHF 179 per share and in May 2002, 161 shareswere sold on the stock market at a price of CHF192.50 per share. The gain of CHF 1 806 on tradingin treasury shares was posted directly to profit reserves in shareholders' equity without impactingon income.

Authorized capital: As of December 31, 2003the Board of Directors is authorized to issue300 000 bearer shares by May 15, 2004. The sub-scription right may be excluded for the purpose of taking over companies by share swaps, or for financing the acquisition of companies, parts ofcompanies or participations or new investmentprojects of the company.

Conditional capital: as of December 31, 2003the company's share capital may be increased exrights by up to 132 600 bearer shares, which mustbe fully paid up; a) up to a sum of CHF 326 000through the exercise of employee option rights andb) up to a sum of CHF 1 million through exerciseof option or conversion rights granted in conjunc-tion with bonds or similar paper issued by the com-pany. So far, no such bonds have been issued. Noemployee options were exercised in 2003.

18 Share capital 2003 2002

Number of bearer shares issued with a par value of CHF 10 1443 672 1443 672Share capital as at December 31 (in CHF) 14 436 720 14 436 720Authorized capital (in CHF) 3 000 000 3 000 000Conditional capital (in CHF) 1326 000 1326 000

52



* Exercises Number Exercise price2001 23 400 CHF 180

2 000 CHF 38025 400

2002 02003 0

19 Employee stock option plan

The Group had an employee stock option plan for executive personnel. In defining the condi-tions of the plan, consideration was given to the objective of securing employees' long-term loyaltyand creating incentives. A lock-in period of severalyears and an exercise price above the current

share price was therefore laid down for all plan participants. The expense incurred in issuing sharesin connection with the exercise of employee stockoptions is not taken to income. The exercise pricesof the options will not be adjusted.

All remaining options expired at the end ofMarch 2003. There is no new option plan.

2003 2002 2001

Options outstanding at the beginning of the year 10 000 10 000 35 400Options issued - - -Exercised * - - - 25 400Expired - 10 000 - -Options outstanding at the end of the year 0 10 000 10 000

20 Transactions with associated persons

with principal shareholder Dr. Hans Widmer:Cash loan: In 2000, Dr. Hans Widmer, Chair-

man of the Board of Directors of Schweiter Tech-nologies, granted the company a shareholder loanof CHF 15 million in connection with the acquisiti-on of the Ismeca Group. The loan debt owed toHans Widmer was repaid in full as of December 31,2003 (in 2002, the remaining debt stood at CHF12.5 million). The interest rate was in line with stand-ard market conditions and stood at 2.5% during theyear under review (previous year: 3%). The inte-rest was paid annually.

Apart from his honorarium of CHF 50 000(previous year: 50 000) as a member of the Boardof Directors and the interest payments amountingto CHF 250 000 on the above-mentioned cash loan (previous year: 312 500), there were no othertransactions with Dr. Hans Widmer.with shareholder CREDIT SUISSE Group:Year under review: no significant transactions.

2002 business year: In January 2002, the remaining 22.7% stake in Ismeca Holding SA, LaChaux-de-Fonds was acquired from CREDIT SUIS-SE Group by means of a share swap (see 34 Purcha-se of investments in subsidiaries and 18 Share capi-tal). In this connection, on March 15, 2002 a totalof 251 275 Schweiter shares were reissued againsta non-cash capital contribution. This transaction al-so includes payment of the 3.75% stake in IsmecaHolding, which was likewise acquired by means ofa share swap and non-cash capital contribution in-stead of by cash payment as originally agreed.

Relationship with CREDIT SUISSE: The Schwei-ter Technologies Group enjoys a normal businessrelationship with CREDIT SUISSE Group as a bankwhich, for its part, exerts no influence whatsoeveron the Group's business operations. All transac-tions with CREDIT SUISSE Group are effected atstandard business/market prices and conditions(cash investment, payment transactions, granting of loans, forward exchange transactions, rents forbuildings, etc.).

53


23 Development expenses

Development expenses consists mainly of expenses on the development of new applicationsand products and also contains salary expenditureof CHF 10.8 million (previous year: CHF 9.1 mil-

lion) for staff working in development. All expen-ses in connection with R & D activity are recordedon the income statement.

22 Compensation for members of the Board of Directors and Management

All members of the Board of Directors, inclu-ding the Chairman, received an annual fee of CHF 50 000 (previous year: CHF 50 000). For 2003,the total compensation paid to the six-member Board of Directors amounted to CHF 300 000 (previous year CHF 250 000 to the five-member Board of Directors). This fee includes attendanceof the periodic Board meetings (at least five peryear) and of the corresponding division meetings.

Total remuneration of management memberscovers basic salaries, bonuses for the business yearin question and the estimated value of other bene-fits of a remunerative nature. For the 2003 busi-

ness year, the total remuneration for the five management members amounted to CHF 2.236million (previous year: CHF 1.794 million).The maximum compensation amounted to CHF 560 000(previous year: CHF 543 000).

The contracts of employment of the actingmembers of management contain no agreement on the payment of a severance benefit in the eventof their departure. There are no contracts of employment with unusual periods of notice (morethan one year). Apart from the payments listed, no further pecuniary benefits were provided. In par-ticular, no options or shares were issued in 2002and 2003.

24 Other operating expenses (in CHF 1000s) 2003 2002

Purchasing and production overheads 4 670 4 581Sales and distribution 9 491 9 126After sales overheads 8 979 7 334Overheads relating to administration and capital taxes 7 436 10 063Cost of premises 3 493 5 009Loss on sale of tangible fixed assets 91 -Total 34 160 36 113

21 Sales deductions (in CHF 1000s) 2003 2002

Commission payments on sales, commission 5 589 6 470Carriage, customs duties, packaging 3 675 5 153Other sales deductions 1 001 3 814Total 10 265 15 437

54



25 Other operating income (in CHF 1000s) 2003 2002

Gains on sale of property, plant and equipment 2 141 113Other income 289 -Total 2 430 113

26 Depreciation (in CHF 1000s) 2003 2002

Depreciation of property, plant and equipment 4 523 5 018Decrease in the value of property, plant and equipment - 1 326Amortization of other intangible assets - 30Restructuring expenses fixed mortgage sale of property - 796Total 4 523 7 170

Goodwill amortization / impairment loss (in CHF 1000s) 2003 2002

Semiconductor:Ordinary amortization of goodwill 353 1 715Impairment loss IAS 36 - 23 841Total Ismeca Semiconductor 353 25 556

Automation:Ordinary amortization of goodwill - 1 141Impairment loss IAS 36 - 19 963Total Ismeca Automation 0 21 104

Total amortization of goodwill / impairment loss 353 46 660

27 Goodwill amortization / impairment loss

The Ismeca participation and goodwill weresubjected to impairment tests on December 31,2003 and 2002. The changed market environmentin Ismeca's Semiconductor division and Automati-on division, coupled with a sharp fall in sales in 2002and a cyclical slump in demand pointed to the needfor such a test.

While the valuation as of December 31, 2003did not result in any further impairment of the goodwill, the value of the shareholding as stated onthe balance sheet as of December 31, 2002 had to be reduced to the estimated value in use, calcu-lated on the basis of anticipated future cash flowsdiscounted by 12% (unchanged compared with previous year).

6

668

55


28 Restructuring expenses

Restructuring expenses incurred in 2003 and2002 were recorded under the corresponding ex-penses positions in the ordinary operating profit,since they are predominantly attributable to struc-ture and capacity adjustments in the Ismeca Semi-conductor division, where they are considered not as one-off expenses, but as part of the cyclicalbusiness.

In 2002, Ismeca took the decision to close itsUS Semiconductor production site and cut back its

US Automation infrastructure. At the same time,jobs were reduced at Ismeca in Switzerland in response to the downturn in the industry. Ismecahas therefore reduced the value of some property,plant and equipment in the US by CHF 1.326 mil-lion to estimated liquidation values. Under depre-ciations Ismeca has also recorded expenditure ofCHF 0.796 million in connection with the termina-tion of a fixed mortgage on land in the USA.

30 Financial expenses (in CHF 1000s) 2003 2002

Interest expenses 1 117 2 842Exchange losses 5 570 3 301Share of loss accounted for by non-consolidated participations - 74Total 6 687 6 217

29 Financial income (in CHF 1000s) 2003 2002

Interest income 727 1 236Exchange gains 6 630 2 217Total 7 357 3 453

56



2002: in 2002, deferred taxes assets were valueadjusted by CHF 8.9 million (included in Other) via tax expenditure, as restructuring measures at Ismeca USA mean that in future it will no longer be

possible to use losses carried forward to the relevantextent. For new losses, losses carried forward wereonly capitalized where their use was presumed to be very likely.

Transfer of income taxes (in CHF 1000s) 2003 2002

Earnings/ loss before tax 17 887 - 42 942Mean tax rate anticipated 22.1% 22.1%Mean tax expenditure anticipated 3 953 - 9 490Differences owing to differing local tax rates - 3 097 2 099Impact of non-taxable income - 146 - 1985Impact of non-deductive expenditure 457 1066Non-capitalized losses carried forward and their appropriation - 811 6 732Permanent and timing differences 51 - 948Impact of depreciations on local goodwill - 246 - 238Other/value adjustment deferred income taxes assets - 7 8 487Effective tax expenditure 154 5 723

Effective tax rate 0.9% n.a.

Deferred taxes are attributable to differencesbetween the standard Group valuation and the taxvaluation in the individual statements. The dif-ferences are mainly due to the use of declining balance method of depreciation and the creation of

reserves on inventories, as approved for tax purposes. The following table shows the differencebetween effective tax expenditure and the mean taxexpenditure anticipated on the basis of local tax rates:

31 Income taxes (in CHF 1000s) 2003 2002

Current taxes - 3 682 5 206Deferred taxes 3 836 517Total 154 5 723

57


The tax losses carried forward will expire as follows: (in CHF 1000s) 2003 2002

– one year - 662– 2 to 5 years 11 938 12 110– in more than 5 years' time 50 245 33 988Total 62183 46 760

Tax losses carried forward which expired without being used during the business year under review 662 241

Of the tax losses carried forward expiring in more than 5 years' time, CHF 2.2 million (previous year CHF3.2 million) will never expire.

As of December 31, 2003, the Group had unutilized tax losses carried forward of CHF 62.2 mil-lion, which could be offset against future earnings. Ofthese, deferred taxes amounting to CHF 17 millionwere capitalized for a proportion of around CHF 4

million. The other losses carried forward were notcapitalized because of uncertainty over whether thefuture earnings will materialize.

The slower tax depreciations are based on localrules and mainly consist of inventory differences.

The provisions for deferred income taxes were in 2002 predominantly consumed by utilizati-on via writeback of local valuation reserves to re-

duce tax losses incurred. Deferred tax liabilitiesmainly resulted from tax-allowable valuation differ-ences on inventories and bad debt allowances.

Balance as at January 1Foreign currency differencesRecording in shareholders' equityUnused amounts reversed

and released to incomeAdditional provisions

charged to income


Slower tax depreciation

Total2002

8 060-1609

-91

-8 885

4 323

1798

32 Deferred income tax assets (in CHF 1000s) Other

215--

-5

68

278

Capitalized taxlosses carried

forward

-40

-

-

1663

1703

158374

-

-

2 346

4 003

Total2003

1798114

0

- 5

4 077

5 984

Balance as at January 1Foreign currency differencesRecording in shareholders' equityUnused amounts reversed

and released to incomeAdditional provisions

charged to income


Accelerated tax depreciation

Total2002

6 491-25141

-5 352

41

1296

33 Deferred income taxliabilities (in CHF 1000s)

OCI IAS 39

Tax provisions

141-

10

-

-

151

9891-

-130

41

901

1661-

-

324

491

Total2003

12962

10

-130

365

1543

58



17

34 Purchase of subsidiaries (in CHF 1000s) 2003 2002

Goodwill acquired - 4 105Minority interests - 28 372Total consideration - 32 477

Paid by: – Capital increase in 2002 - 39 357– Reduction in purchase price commitment - - 7 370– Other liabilities - - 408– Cash settlement - 898

Total - 32 447

Decrease in cash and cash equivalents - - 898

In 2002, the remaining shareholdings in Ismecawere acquired (see Changes in scope of consolida-tion and 18 Share capital).

35 Earnings/ loss per share 2003 2002

Net income / loss (in CHF 1000s) 17 733 - 48 665

Average number of shares issued 1443 672 1385 685less average number of treasury shares - 2 073 - 73

Average number of shares in circulation 1441599 1385612

Dilution effect resulting from outstanding options - -

Average number of shares in circulation after dilution effect 1441599 1385612

Earnings / loss per share befor dilution (in CHF) 12.30 - 35.10Earnings / loss per share after dilution (in CHF) 12.30 - 35.10

59


36 Financial instruments

The Group engages in forward exchange trans-actions to hedge against exchange rate risks. Theinstruments are not used for speculative purposes.As of December 31, 2003, the maturities of out-

Forward exchange transactions (in CHF 1000s) 2003 2002

Total amount of outstanding forward exchange transactions– Sale of US dollars for CHF, contract value 31 921 22 819– Average exchange rates per USD 1.2926 1.4943

of which outstanding forward exchange transactions for hedging future incoming payments (cash flow hedges) 17 766 8 296

– Average exchange rates per USD 1.2893 1.4985

Net fair value (market value) of forward exchange transactions for cash flow hedges 17 110 7 682

Unrealized gain from cash flow hedges 656 614

Deferred income taxes (23%) - 151 - 141

Net gain recorded as OCI in shareholders' equity 505 473

Unrealized gains and losses from derivative financial instruments to hedge balance sheet posi-tions are attributed to the latter with an impact onincome.

Unrealized gains and losses from cash flow hedges have been credited / debited (tax adjusted)direct as “OCI, other comprehensive income / ex-pense” to shareholders' equity.

standing forward transactions ranged from 2 weeksto 23 months (previous year between 2 weeks and9 months).

37 Contingent liabilities (in CHF 1000s) 2003 2002

Warranties and guarantees 3 275 3 054Recourse claims and discounting facilities 292 617Total 3 567 3 671

Commitments to take delivery: Under pur-chase contracts for machine parts and raw materials,commitments to take delivery amounting to CHF49.2 million (previous year CHF 27.3 million) and withmaximum maturities of 25 months have been enter-ed into in the course of ordinary business activities.

A competitor of the Satis Group has threat-ened legal action on grounds of patent infringements.The outcome is currently still open.

33

60



The Board of Directors of Schweiter Technologies approved the present annual financial statements at its meeting on March 17, 2004. The General Meeting will give the annual financial statements its final approval on May 19, 2004. The Board of Directors is proposing that the General Meeting adopt a nominalvalue repayment amounting to CHF 3 per bearer share in place of a dividend.

39 Off balance sheet liabilities and balances arising from rental and leasing contracts

Commitments (in CHF 1000s) 2003 2002

– due in one year's time 2 837 3 256– due in 2 to 5 years' time 7 561 5 633– due in more than 5 years' time 2 530 -Total 12 928 8 889

40 Events occurring after the balancesheet date

No events occurred between the balance sheetdate and the date of publication of this annual report which could have a significant impact on the2003 consolidated financial statements.

The commitments consist mainly of rental agreements for buildings used by the company itself.The average term of the agreements is 3.1 years (pre-

vious year: 2.5 years). Leasing obligations amountingto CHF 1.18 million are included.

Credit balances (in CHF 1000s) 2003 2002

– due in one year's time 456 341– due in 2 to 5 years' time 960 480– due in more than 5 years' time 480 -Total 1 896 821

The credit balances consist of sublet premises.Half of the annual rental income comes from rentalagreements of unlimited duration and periods of

notice of 6 months. In the first year this rental income is only taken into account for six months.

38 Rights of lien (in CHF 1000s) 2003 2002

Assets encumbered by rights of lien 18 037 23 908

of which: Land and buildings: – Net book value 17 708 23 798– Right of lien 9 900 21 910– Collateral amount 6 280 10 962

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Report of the Group auditors

To the General Meeting of the Shareholders ofSchweiter Technologies AG, Horgen

As Group auditors, we have audited the consolidated financial statements (balance sheet, income statement, cash flow statement, statementof changes in shareholders' equity and notes) of theSchweiter Technologies Group for the year endedDecember 31, 2003.

These consolidated financial statements are theresponsibility of the Company's Board of Directors.Our responsibility is to express an opinion on these consolidated financial statements based onour audit. We confirm that we meet the legal requirements concerning professional qualificationand independence.

Our audit was conducted in accordance withauditing standards promulgated by the Swiss pro-fession and with the International Standards on Auditing issued by the International Federation ofAccountants (IFAC). Those standards require thatwe plan and perform the audit to obtain reason-able assurance about whether the consolidated financial statements are free from material mis-statement. We have examined on a test basis

evidence supporting the amounts and disclosuresin the financial statements. We have also assessedthe accounting principles used, significant estimatesmade by management and the overall consolidatedfinancial statement presentation. We believe thatour audit provides a reasonable basis for our opinion.

In our opinion, the consolidated financial state-ments give a true and fair view of the financial posi-tion, the results of operations and the cash flowsand comply with International Financial ReportingStandards (IFRS) and Swiss law.

We recommend that the consolidated finan-cial statements submitted to you be approved.

Zurich, March 18, 2004

Deloitte & Touche AG

David Wilson Daniel O. FlammerAuditor in charge

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63


Annual financial statements of Schweiter Technologies AG

Balance sheet as at December 31

Income statement

Notes to the annual financial statements

Notes to the balance sheet and the income statement

Proposal of the Board of Directors concerning the appropriation of the available earnings

Report of the statutory auditors

64

65

66 – 69

66 – 69

70

71

64

Schweiter Technologies AG

Assets (in CHF)

Current assetsCash and cash equivalentsMarketable securities (treasury shares)Trade receivablesOther receivables due from third partiesOther receivables due from consolidated companiesPrepaid expenses and accrualsTotal current assets

Fixed assetsInvestmentsLoans to consolidated companies Total fixed assets

Total assets

Liabilities (in CHF)

Short-term liabilitiesShort-term bank liabilitiesShort-term interest-bearing

liabilities toward Group and shareholdersOther liabilitiesProvisions, accruals and deferred incomeTotal short-term liabilitiesLong-term interest-bearing liabilities toward GroupProvisionsTotal long-term liabilities

Total liabilities

Shareholders' equityShare capitalPremiumGeneral statutory reservesReserves for treasury sharesUnappropriated reservesEarnings carried forwardNet income/ lossTotal shareholders' equity

Total liabilities

2003

3 693 3022 391 076

-873

2 481 717280

8 567 248

141 634 93313 274 110

154 909 043

163 476 291

-

15 629 767147 247435 286

16 212 300-

150 000150 000

16 362 300

14 436 720107 380 834

2 400 0002 391 0761 071 0001 896 415

17 537 946147 113 991

163 476 291

Balance sheet as at December 31

3

1

2

3

For additional details see notes to the annual financial statements▲

2002

2 612 031-

28 1002 005

703 705-

3 345 841

141 634 93317 005 814

158 640 747

161 986 588

5 127 053

12 826 719147 827431 944

18 533 54313 727 000

150 00013 877 000

32 410 543

14 436 720107 380 834

2 400 000-

1 071 00041 964 636

- 37 677 145129 576 045

161 986 588

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2003

17 000 0001 222 0831 072 6471 104 000

20 398 730

- 663 929- 790 116- 765 249- 641 490

-17 537 946

--

17 537 946

-17 537 946

(in CHF)

Income from investmentsFinancial incomeRental incomeManagement fee incomeTotal income

Financial expensesAdministrative expensesPersonnel expenses Expenses on premisesDepreciation on investments (impairment loss)Operating profit / loss

Other incomeOther expensesIncome/loss before taxes

Income taxesNet income/loss

Income statement

56

78

910

For additional details see notes to the annual financial statements▲

2002

23 600 000915 636

1 096 6001 104 000

26 716 236

- 1 679 404- 718 892- 411 400- 600 200

- 61 205 370- 37 899 030

2 852- 1 387

- 37 897 565

220 420- 37 677 145

1 Investments (in CHF 1000s) Nominal share capital % 2003 2002

SSM Schärer Schweiter Mettler AG, Horgen 6 000 100 6 000 6 000SSM Vertriebs AG, Baar 100 100 100 100Hacoba Spultechnik GmbH, Wuppertal (SC in EUR) 25 100 6 420 6 420Satis Vacuum Holding AG, Baar 5 000 100 29 285 29 285Ismeca Holding SA, La Chaux-de-Fonds 5 000 100 - 99 830Ismeca Semiconductor Holding SA, La Chaux-de-Fonds 5 000 100 83 956 -Ismeca Automation Holding SA, La Chaux-de-Fonds 1 400 100 15 874 -Total 141 635 141 635

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Ismeca Group. CHF 2.5 million was repaid during2000 and the remaining CHF 12.5 million at the endof December 2003. The interest paid was in linewith standard market conditions and stood at 2%during the year under review (previous year: 2.5%).The interest was paid annually.

2 Short-term interest-bearing liabilities towards Group and shareholders

In 2000, Dr. Hans Widmer, Chairman of theBoard of Directors of Schweiter Technologies,granted the company a shareholder loan of CHF 15million in connection with the acquisition of the

3 Share capital 2003 2002

Number of bearer shares issued with a par value of CHF 10 1443 672 1443 672Share capital as at December 31 (in CHF) 14 436 720 14 436 720Authorized capital (in CHF) 3 000 000 3 000 000Conditional capital (in CHF) 1326 000 1326 000

There were no capital changes in 2003.Capital increases in 2002: Under the capital

increase of March 15, 2002, 251 275 new shares were created from the authorized capital and issuedagainst a contribution in kind in the form of the remaining Ismeca shareholdings (22.7% plus 3.75%in place of the cash payment originally agreed upon)by CREDIT SUISSE Group companies. Moreover,25 400 shares created from the conditional capitalfor employee options exercised in 2001 were registered. The latter 25 400 shares were countedtoward the share capital as of December 31, 2001,and deducted from the conditional capital. The contribution in kind was valued at CHF 155 perSchweiter share, which resulted in a premium ofCHF 36.8 million.

Treasury shares in 2003: 13 476 treasury shareswere held as of December 31, 2003. They were

purchased on the stock exchange in November2003 for an average price of CHF 177.40. As a con-sequence, the sum of CHF 2 391 076 was takenfrom the profit carried forward and used to form a reserve for treasury shares. Treasury shares arevalued at their acquisition price.

Treasury shares 2002: The reserve for treasuryshares of CHF 53 700 was written back at the beginning of 2002 upon issue to staff / sale of saidshares and credited to earnings carried forward.

Authorized capital: As of December 31, 2003the Board of Directors is authorized to issue300 000 bearer shares by May 15, 2004. The sub-scription right may be excluded for the purpose of taking over companies by share swaps, or for financing the acquisition of companies, parts ofcompanies or participations or new investmentprojects of the company.

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The following shareholders hold more than 5% of voting rights (pursuant to Art. 663c of the Swiss Code of Obligations):

Percentage of shares held 2003 2002

Dr. Hans Widmer / Hans Widmer Management AG, Baar 24.9 % 24.9 %Beat Siegrist, Herrliberg 5.3 % < 5.0 %CREDIT SUISSE Group, Zurich 16.2 % * 16.2 %Basel government employees' pension fund, Basel < 5.0 % > 5.0 %

At the beginning of 2004, the proportion of voting rights decreased to less than 5%.

Conditional capital: as of December 31, 2003the company's share capital may be increased exrights by up to 100 000 bearer shares, which mustbe fully paid up; a) up to a sum of CHF 326 000through the exercise of employee option rights andb) up to a sum of CHF 1 million through exerciseof option or conversion rights granted in conjunc-

tion with bonds or similar paper issued by the com-pany. So far, no such bonds have been issued.

Bearer shares are listed on the main stockexchange in Zurich. Security number: 1075 492; Telekurs: SWTQ; Reuters: SWTZ.

* Exercises Number Exercise price2001 23 400 CHF 180

2 000 CHF 38025 400

2002 02003 0

4 Employee stock option plan

The Group had an employee stock option planfor executive personnel. In defining the conditionsof the plan, consideration was given to the objec-tive of securing employees' long-term loyalty andcreating incentives. A lock-in period of several yearsand an exercise price above the current share pricewas therefore laid down for all plan participants.Upon the exercise of options the nominal value per

share is credited to the share capital and any excess subscription amount is credited to the premium. The fair value of the employee options isnot charged to the income statement of the company in question either when the employee option is issued or when it is exercised. The exer-cise prices of the options were not adjusted.

All options expired on March 31, 2003. Thereis no new option plan.

2003 2002 2001

Options outstanding at the beginning of the year 10 000 10 000 35 400Options issued - - -Exercised * - - - 25 400Expired - 10 000 - -Options outstanding at the end of the year 0 10 000 10 000

68


10 Depreciation on investments/impairment loss

The Ismeca participation was subjected to im-pairment tests on December 31, 2003 and 2002.The changed market environment in Ismeca's Semiconductor and Automation divisions, coupledwith a sharp fall in sales in 2002 and a cyclical slumpin demand pointed to the need for such a test. As of December 31, 2002 the goodwill on the esti-mated value in use, as stated on the balance sheet,calculated on the basis of anticipated future cashflows discounted by 12% (unchanged comparedwith previous year) was written down.

No value adjustment was recorded in 2003.(The previous year's impairment-loss/value adjust-ment amounted to CHF 61.2 million.)

5 Financial income (in CHF 1000s) 2003 2002

Interest income from Group companies 685 818Interest paid by banks 58 28Exchange gains 479 70Total 1222 916

8 Administrative expenses

All members of the Board of Directors, inclu-ding the Chairman, received an annual fee of CHF 50 000 (previous year: CHF 50 000). For 2003,the total compensation paid to the six-member Board of Directors amounted to CHF 300 000 (previous year CHF 250 000 to the five-member Board of Directors). This fee includes attendanceof the periodic Board meetings (at least five peryear) and of the corresponding division meetings.

9 Expenses on premises

The rental agreement with CREDIT SUISSSEGroup is valid until December 31, 2010.

6 Rental income (in CHF 1000s) 2003 2002

Rental income from Group companies 639 600Rental income from third parties 434 497Total 1073 1097

7 Financial expenses (in CHF 1000s) 2003 2002

Interest expenses Group companies and shareholders 526 526Interest expenses third parties, discounting of purchase price debt - 497Bank interest 10 491Exchange losses 128 166Total 664 1680


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11 Contingent liabilities

In connection with credit facilities extended to the subsidiaries, the holding company has un-dertaken a guarantee in an amount up to a total ofCHF 35.9 million. Of this amount, a total of CHF12.8 million (cash lines: CHF 1.8 million, mortga-ges: CHF 5.5 million, sureties and guarantees: CHF5.5 million) had been drawn on by subsidiaries as atDecember 31, 2003.

12 Events occurring after the balance sheet date

No events occurred between the balance sheetdate and the date of publication of this annual report which could have a significant impact on the2003 consolidated financial statements.

70


(in CHF) 2003

Earnings carried forward from previous year 4 287 491Net income for 2003 17 537 946Appropriated to reserves for treasury shares - 2 391 076

Earnings available to the General Meeting 19 434 361

The Board of Directors proposes to the General Meetingon May 19, 2004 that the following appropriation of available earnings be adopted:

Appropriated to general statutory reserves 600 000Earnings carried forward 18 834 361

Total 19 434 361

The Board of Directors is proposing that the General Meeting adopt a nominal value repayment amountingto CHF 3 per bearer share instead of a dividend.

Proposal of the Board of Directors concerning the appropriation of the available earnings

sures in the financial statements. We have also assessed the accounting principles used, significantestimates made and the overall financial statementpresentation. We believe that our audit provides areasonable basis for our opinion.

In our opinion, the accounting records, finan-cial statements and the proposed appropriation ofavailable earnings comply with Swiss law and thecompany’s articles of incorporation.

We recommend that the financial statementssubmitted to you to be approved.

Zurich, March 18, 2004

Deloitte & Touche AG

David Wilson Daniel O. FlammerAuditor in charge

To the General Meeting of the Shareholders ofSchweiter Technologies AG, Horgen

As statutory auditors, we have audited theaccounting records and the financial statements (balance sheet, income statement and notes) ofSchweiter Technologies AG, Horgen, for the yearended December 31, 2003.

These financial statements are the responsibi-lity of the board of directors. Our responsibility isto express an opinion on these financial statementsbased on our audit. We confirm that we meet thelegal requirements concerning professional qualifi-cation and independence.

Our audit was conducted in accordance withauditing standards promulgated by the Swiss pro-fession, which require that an audit be planned andperformed to obtain reasonable assurance aboutwhether the financial statements are free from ma-terial misstatement. We have examined on a testbasis evidence supporting the amounts and disclo-

Report of the statutory auditors


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Schweiter Technologies AGNeugasse 10CH-8812 HorgenTel. +41 1 718 33 11Fax +41 1 718 34 [email protected]

SSM Schärer Schweiter Mettler AGNeugasse 10CH-8812 HorgenTel. +41 1 718 33 11Fax +41 1 718 34 [email protected]

SSM Vertriebs AGNeuhofstrasse 12CH-6340 BaarTel. +41 41 766 16 26Fax +41 41 766 16 10

SSM Stähle Eltex GmbHStorlachstrasse 4D-72766 ReutlingenTel. +49 7121 93 880Fax +49 7121 93 [email protected]

Hacoba Spultechnik GmbHHatzfelderstrasse 161D-42281 WuppertalTel. +49 202 7091 01Fax +49 202 7091 [email protected]

SSM Zhongshan Ltd.Torch Building, 2nd FloorZhongshan City, Guangdong 528437 PR ChinaTel. +86 760 828 53 20Fax +86 760 559 68 77

SSM Americas Corp.P.O. Box 266858Fort Lauderdale, FL, 33326, USATel. +1 954 349 6433Fax +1 954 349 [email protected]

Addresses

SSM Schärer Schweiter Mettler AGFar East Representative OfficeRoom 1002, Park Tower15 Austin Road, Tsimshatsui,Kowloon, Hong KongTel. +852 2736 2698Fax +852 2730 2399

Satis Vacuum Holding AGNeuhofstrasse 12CH-6340 BaarTel. +41 41 766 16 16Fax +41 41 766 16 10

Satis Vacuum Industries Vertriebs AGNeuhofstrasse 12CH-6340 BaarTel. +41 41 766 16 16Fax +41 41 766 16 [email protected]

Satis Vacuum Industries S.p.A.Via del Campaccio 13I-20019 Settimo MilaneseTel. +39 02 33 55 61Fax +39 02 33 50 12 [email protected]

Satis Vacuum Deutschland GmbHBeethovenstrasse 30D-63526 ErlenseeTel. +49 6183 730 81Fax +49 6183 727 70

Satis Vacuum of America Inc.2400 Spiegel Drive, Unit D2P.O. Box 180Groveport, Ohio, 43125, USATel. +1 614 409 9401Fax +1 614 409 9306

Satis Vacuum (UK) Ltd.Unit 16, Futura Park, MiddlebrookBolton, Greater ManchesterBLD6 6PG, UKTel. +44 1204 698955Fax +44 1204 469147

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Satis Vacuum Asia Pte. Ltd.5 Pemimpin Drive # 12 – 04Singapore 576149Tel. +65 6250 18 87Fax +65 6250 56 [email protected]

Satis Photonics AGNeugasse 10CH-8812 HorgenTel. +41 43 244 15 44Fax +41 43 244 15 40www.satic-vacuum.ch

Ismeca Automation Holding SARue de l’Helvétie 283CH-2301 La Chaux-de-FondsTel. +41 32 925 71 11Fax +41 32 925 71 [email protected]

Ismeca Europe Automation SARue de l’Helvétie 283CH-2301 La Chaux-de-FondsTel. +41 32 925 71 11Fax +41 32 925 71 [email protected]

Ismeca (UK) Ltd.6 Azalea Drive, Up HatherleyCheltenhamGloucestershire GL51 3EATel. +44 (0) 1242 86 35 55Fax +44 (0) 8707 62 06 96

Ismeca France S.à.r.l.3, Place de MontraponF-25000 BesançonTel. +33 382 88 27 50Fax +33 381 88 27 51

Ismeca Europa Succursale ItalianaViale Papiniano 10I-20123 MilanoTel. +39 02 48 51 60 06Fax +39 02 46 94 399

Ismeca Semiconductor Holding SARue de l’Helvétie 283CH-2301 La Chaux-de-FondsTel. +41 32 925 71 11Fax +41 32 925 72 [email protected]

Ismeca Europe Semiconductor SARue de l’Helvétie 283CH-2301 La Chaux-de-FondsTel. +41 32 925 71 11Fax +41 32 925 72 [email protected]

Ismeca GmbHDaimlerstrasse 30D-75392 DeckenpfronnTel. +49 70 56-80 92Fax +49 70 56-43 40

Ismeca USA Semiconductor Inc.2365 Oak Ridge WayVista, CA 92083-8348, USATel. +1 760 305 62 00Fax +1 760 305 62 90

Ismeca Malaysia Sdn. Bhd.Plot 3-61Cheng Industrial Estate75250 Melaka, MalaysiaTel. +60 6 335 28 82Fax +60 6 335 29 00

Ismeca Asia, Ltd.Room 5, 22nd Floor Fullagar Industrial Building234 Aberdeen Main RoadAberdeen, Hong KongTel. +852 2873 3213Fax +852 2873 1027

Ismeca Asia, Ltd. ShanghaiRepresentative OfficePine City Hotel, 8 Dong An RoadShanghai, 200032PR ChinaTel. +86 21 6443 8787Fax +86 21 6443 6918

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Mike Aschwanden, Zurich

Pia Zanetti, Zurich

Altamont, Zurich

bmp translations ag, Zurich

Fotorotar AG, Egg /ZH

Printed in Switzerland;

This is an English translation of the German Annual Report. The German text is the official version.

Additional copies may be ordered fromSchweiter Technologies.

Design/Production

Photography

Lithograph

Translation

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Copyright bySchweiter Technologies

CH-8812 Horgen

Schweiter Technologies AGNeugasse 10 CH-8812 Horgen

Telefon +41 1 718 33 11 Fax +41 1 718 34 51

E-mail [email protected]

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