Notes to the financial statements of Autoneum Holding Ltd

1 Principles

General

Autoneum Holding Ltd was incorporated on December 2, 2010 as a Swiss corporation domiciled in Winterthur. The Company does not have any employees.

The financial statements were prepared according to the provisions of the Swiss Law on Accounting and Financial Reporting (32nd title of the Swiss Code of Obligations). Where not prescribed by law, the significant accounting and valuation principles applied are described below.

Loans and financial receivables

Loans granted in foreign currencies are translated at the rate at the balance sheet date, whereby unrealized losses are recorded but unrealized gains are not recognized. In the case where the currency effect of loans is hedged, both unrealized losses and gains are recognized.

Treasury shares

Treasury shares are recognized at acquisition cost and deducted from shareholders’ equity at the time of acquisition. In case of a sale, the gain or loss is recognized in the income statement as financial income or financial expenses.

Bonds and bank debts

Borrowings are recognized in the balance sheet at nominal value. The issue costs for the bonds and for finance agreements are recognized as accrued income and deferred expenses due from third parties and amortized on a straight-line basis over the maturity period.

Investments

Investments are valued using the single-item approach.

2 Financial income

CHF million

2019

2018

Interest income

5.6

17.9

Other financial income

0.3

1.1

Total

5.9

18.9

3 Valuation adjustments on investments and loans

CHF million

2019

2018

Increase of valuation adjustments on investments

–72.1

–40.3

Increase of valuation adjustments on loans due from subsidiaries

–15.3

Reversal of valuation adjustments on loans due from subsidiaries

63.9

17.9

Total

–8.2

–37.7

4 Financial expenses

CHF million

2019

2018

Interest expenses

–7.7

–4.1

Net foreign exchange losses

–7.0

–12.2

Other financial expenses

–0.9

–0.6

Total

–15.6

–16.9

5 Extraordinary expenses

There are no extraordinary expenses in 2019 and 2018.

6 Loans and financial receivables

CHF million

31.12.2019

31.12.2018

Loans due from subsidiaries

83.0

67.0

Loans due from third parties

1.0

1.2

Cash pool receivables due from subsidiaries

17.8

48.2

Total current portion

101.8

116.4

Loans due from subsidiaries

406.6

343.4

Loans due from third parties

5.0

6.1

Total non-current portion

411.6

349.6

7 Accrued income and deferred expenses

CHF million

31.12.2019

31.12.2018

Loans due from subsidiaries

83.0

67.0

Loans due from third parties

1.0

1.2

Cash pool receivables due from subsidiaries

17.8

48.2

Total current portion

101.8

116.4

Loans due from subsidiaries

406.6

343.4

Loans due from third parties

5.0

6.1

Total non-current portion

411.6

349.6

8 Investments

The subsidiaries, associated companies and non-consolidated investments are listed in note 16. They are owned directly or indirectly by Autoneum Holding Ltd.

9 Borrowings

CHF million

31.12.2019

31.12.2018

Cash pool liabilities due to subsidiaries

70.6

57.6

Bank debts

21.0

Loans due to subsidiaries

14.6

Loans due to related parties

5.0

5.0

Total current portion

96.6

77.2

Bonds

175.0

175.0

Bank debts

150.0

140.0

Loans due to subsidiaries

22.5

Subordinated shareholder loans

40.0

Total non-current portion

365.0

337.5

Loans due to related parties comprise a loan of CHF 5.0 million that was granted by the pension fund of an Autoneum Group entity to the Company. The loan bears an interest rate of 0.75% and is due within six days upon cancellation of the agreement by either the lender or the borrower. The two main shareholders of Autoneum Holding Ltd have granted a subordinated loan of CHF 20.0 million each, with an interest of 4% and maturity date January 2021.

On July 4, 2016 Autoneum Holding Ltd issued a fixed-rate bond with a nominal value of CHF 75.0 million, which is listed on the SIX Swiss Exchange (AUH16, ISIN: CH0326213904). The bond carries a coupon rate of 1.125% and has a term of seven years with a final maturity on July 4, 2023.

On December 8, 2017 Autoneum Holding Ltd issued a fixed-rate bond with a nominal value of CHF 100.0 million, which is listed on the SIX Swiss Exchange (AUT17, ISIN: CH0373476032). The bond carries a coupon rate of 1.125% and has a term of eight years with a final maturity on December 8, 2025.

Autoneum maintains a long-term credit agreement with a banking syndicate in the amount of CHF 350.0 million, whereof CHF 150.0 million was drawn at year end (2018: CHF 140.0 million). The line of credit may partly be used as a guarantee facility. On December 7, 2017 the long-term credit agreement was amended and the final maturity date extended from December 31, 2019 to December 31, 2022. On May 7, 2019 the existing long-term credit agreement was increased from CHF 150.0 million to CHF 350.0 million with an unchanged final maturity date. The interest rate is based on the LIBOR rate plus an applicable margin, which is determined based on the ratio of net debt to EBITDA. The credit agreement contains customary financial covenants, which include an adjusted ratio of net debt to EBITDA. Compliance with financial covenants is checked on a regular basis and reported to the banking syndicate. In the fiscal years 2019 and 2018, the financial covenants were met at all times.

10 Other liabilities

CHF million

31.12.2019

31.12.2018

Other liabilities due to subsidiaries

6.6

0.3

Other liabilities due to third parties

0.5

0.5

Total

7.1

0.8

11 Deferred income and accrued expenses

CHF million

31.12.2019

31.12.2018

Deferred income and accrued expenses due from subsidiaries

0.1

2.8

Deferred income and accrued expenses due from third parties

2.3

2.3

Total

2.4

5.0

12 Shareholders’ equity

Share capital

The share capital amounts to CHF 233 618.15. It is divided into 4 672 363 fully paid registered shares with a par value of CHF 0.05 each.

Conditional share capital

For issuing convertible bonds, warranty bonds and for granting shareholder options, the share capital can be increased by a maximum of 700 000 fully paid up registered shares with a par value of CHF 0.05 up to a maximum value of CHF 35 000. Furthermore, for the issuance of shares to employees of subsidiaries, the share capital can be increased by a maximum of 250 000 fully paid up registered shares with a par value of CHF 0.05 up to a maximum value of CHF 12 500.

Legal capital reserves

These reserves include an amount of CHF 0.1 million (2018: CHF 0.1 million) whose distribution as dividends is not subject to income taxes in Switzerland and can be effected free of Swiss withholding tax. The remaining part of the legal capital reserve does not benefit from the Swiss capital contribution principle.

Treasury shares

The following transactions with treasury shares were performed during the financial year:

2019 in shares

2019 in CHF million

2018 in shares

2018 in CHF million

Treasury shares at January 1

19 985

3.7

18 445

3.3

Purchase of treasury shares

21 677

2.8

12 514

2.4

Sale of treasury shares

–8 420

–1.5

–7 460

–1.4

Transfer of treasury shares

–7 459

–1.4

–3 514

–0.7

Treasury shares at December 31

25 783

3.6

19 985

3.7

13 Guarantees and collateral provided

Autoneum Holding Ltd has guaranteed CHF 34.1 million (2018: CHF 35.0 million) to financial institutions for granting credit facilities to direct and indirect subsidiaries and CHF 7.2 million (2018: CHF 7.6 million) to other third parties for securing transactions they entered into with direct and indirect subsidiaries and other third parties. Furthermore, a financing commitment in the amount of CHF 7.6 million was given in favor of a subsidiary (2018: CHF 7.9 million).

14 Shares allocated to the Board of Directors

Part of the remuneration of the Board of Directors is paid in shares of Autoneum Holding Ltd. In 2019, 8 693 shares (2018: 4 014 shares) with a total value of CHF 1 079 671 (2018: CHF 1 027 264) were allocated and 7 461 shares (2018: 3 514 shares) were transferred to the members of the Board of Directors. The remaining shares were withheld by the Company to account for the beneficiaries’ part of social security contributions and withholding taxes.

15 Shares held by the members of the Board of Directors or Group Executive Board

The following shares were held by members of the Board of Directors or the Group Executive Board, including parties related to them (Art. 663c Swiss Code of Obligations):

Number of shares

31.12.2019

31.12.2018

Hans-Peter Schwald, Chairman

43 296

40 000

Rainer Schmückle, Vice Chairman

2 677

1 599

Norbert Indlekofer

538

229

Michael Pieper

986 068

984 151

This E. Schneider

14 794

9 782

Peter Spuhler

754 603

803 705

Ferdinand Stutz

3 514

3 065

Total Board of Directors

1 805 490

1 842 531

Matthias Holzammer, CEO

6 202

3 166

Bernhard Wiehl

89

n/a

Alexandra Bendler

628

n/a

Greg Sibley

n/a

Andreas Kolf

1 015

730

Fausto Bigi

Total Group Executive Board

7 934

3 896

16 Subsidiaries, associated companies and investments

Nominal capitalin millions

Directly owned

Indirectly owned

Voting & capital rights

Research & technology

Application developm.

Production & supply

Service & financing

Switzerland

Autoneum International Ltd, Winterthur

CHF

7.0

100%

Autoneum Management Ltd, Winterthur

CHF

1.3

100%

Autoneum Switzerland Ltd, Sevelen

CHF

0.3

100%

Argentina

Autoneum Argentina S.A., Córdoba

ARS

22.5

100%

Belgium

Autoneum Belgium NV, Genk

EUR

8.0

100%

Brazil

Autoneum Brasil Têxteis Acústicos Ltda., São Paulo

BRL

201.6

100%

Canada

Autoneum Canada Ltd., Tillsonburg

CAD

100%

China

Autoneum (Chongqing) Sound-Proof Parts Co., Ltd., Chongqing

CNY

49.3

100%

Autoneum (Shenyang) Sound-Proof Parts Co., Ltd., Shenyang

CNY

49.2

100%

Autoneum (Shanghai) Management Co., Ltd., Shanghai

CNY

13.2

100%

Autoneum (Yantai) Co., Ltd., Yantai

CNY

34.5

100%

Autoneum (Changsha) Co., Ltd., Changsha

CNY

34.5

100%

Autoneum (Pinghu) Co., Ltd., Pinghu

CNY

144.9

100%

Autoneum (Tianjin) Co., Ltd., Tianjin

CNY

17.0

100%

Autoneum Nittoku (Guangzhou) Sound-Proof Co. Ltd., Guangzhou

CNY

75.8

51%

Tianjin Autoneum Nittoku Sound-Proof Co., Ltd., Tianjin

CNY

47.2

51%

Wuhan Nittoku Autoneum Sound-Proof Co., Ltd., Wuhan

CNY

89.6

25%

Czech Republic

Autoneum CZ s.r.o., Choceň

CZK

206.2

100%

France

Autoneum Holding France SAS, Lyon

EUR

39.8

100%

Autoneum France SAS, Aubergenville

EUR

8.0

100%

Germany

Autoneum Germany GmbH, Rossdorf

EUR

11.2

100%

Great Britain

Autoneum Great Britain Ltd., Stoke-on-Trent

GBP

41.8

100%

Hungary

Autoneum Hungary Ltd., Komárom

EUR

100%

India

Autoneum India Pvt. Ltd., New Delhi

INR

571.4

100%

Autoneum Nittoku Sound Proof Products India Pvt. Ltd., Chennai

INR

220.0

51%

Indonesia

PT Tuffindo Nittoku Autoneum, Jakarta

IDR

162 666.0

9%

Italy

Porfima Uno S.r.l., Torino

EUR

100%

Japan

Nihon Tokushu Toryo Co. Ltd., Tokyo

JPY

4 753.0

13%

ATN Auto Acoustics Inc., Kamioguchi2

JPY

100.0

25%

Korea

Autoneum Korea Ltd., Incheon

KRW

264.0

100%

Mexico

Autoneum Mexico, S. de R.L. de C.V., Hermosillo

MXN

100%

Autoneum Mexico Operations, S.A. de C.V., San Luis Potosí

MXN

503.9

100%

Autoneum Mexico Servicios, S.A. de C.V., San Luis Potosí

MXN

3.1

100%

UGN de Mexico, S. de R.L. de C.V., Silao

MXN

0.1

50%

Servicios de Acoustical Solutions, S. de R.L. de C.V., Silao

MXN

0.1

50%

Poland

Autoneum Poland Sp.z.o.o., Katowice

PLN

20.8

100%

Portugal

Autoneum Portugal Lda., Setúbal

EUR

0.6

87%

Russia

Autoneum Rus LLC, Ryazan

RUB

0.8

100%

South Africa

Autoneum Feltex (Pty) Ltd., Durban

ZAR

51%

Spain

Autoneum Spain S.A.U., Terrassa

EUR

5.8

100%

Thailand

SRN Sound Proof Co., Ltd., Chonburi

THB

100.0

30%

Summit & Autoneum (Thailand) Co., Ltd., Chonburi

THB

16.0

51%3

Turkey

Autoneum Erkurt Otomotive AS, Bursa

TRY

2.5

51%

USA

Autoneum America Corporation, Novi

USD

100%

Autoneum North America Inc., Novi

USD

100%

UGN Inc., Tinley Park

USD

50%

  1. 1 Unless otherwise noted, voting and capital rights have not changed compared to prior year.
  2. 2 The Company acquired 25% of voting and capital rights in 2018.
  3. 3 Autoneum has 49% of the capital rights.

17 Significant shareholders

At December 31, Autoneum knew that the following shareholders had more than 3% of the Company voting rights (in accordance with Art. 663c of the Swiss Code of Obligations):

31.12.2019

31.12.2018

Artemis Beteiligungen I Ltd, Hergiswil, Switzerland; Centinox Holding Ltd, Hergiswil, Switzerland; and Michael Pieper, Hergiswil, Switzerland1

21.10%

21.06%

PCS Holding Ltd, Warth-Weiningen, Switzerland; and Peter Spuhler, Weiningen, Switzerland1

16.15%

17.20%

Martin und Rosmarie Ebner via BZ Bank Limited, Wilen, Switzerland

3.10%

n/a

Credit Suisse Funds Ltd, Zurich, Switzerland

3.07%

n/a

  1. 1 Voting rights according to the Company’s records at December 31.

18 Events after balance sheet date

There were no events between December 31, 2019 and March 3, 2020 that would necessitate adjustments to the book value of the Company’s assets or liabilities, or that require additional disclosure in the financial statements.