Financial Review FULL-YEAR CLARIANT INTERNATIONAL LTD Rothausstrasse 61 4132 Muttenz Switzerland
Page 1 of 16 Key Financial Group Figures Continuing operations: CHF m 2016 % of sales CHF m 2015 % of sales Sales 5 847 100.0 5 807 100.0 Local currency growth (LC): 2% Organic growth 1 1% Acquisitions/divestitures 1% Currencies 1% Gross profit*** 1770 30.2 1785 30.7 EBITDA before exceptional items* 887 15.2 853 14.7 EBITDA* 785 13.4 767 13.2 Operating income before exceptional items* 622 10.6 596 10.3 Operating income 512 8.8 496 8.5 Net income 263 4.5 227 3.9 Basic earnings per share (CHF/share) 0.78 0.67 Adjusted earnings per share (CHF/share)* 1.12 1.01 Operating cash flow 646 502 Discontinued operations: Sales Net income from discontinued operations 12 Other key figures total Group: 31.12.2016 31.12.2015 Net debt 1540 1 312 Equity (including non-controlling interests) 2546 2494 Gearing 60% 53% Return on invested capital (ROIC)** 10.2% 9.7% Number of employees 17 442 17 213 1 Throughout this statement the term organic growth is used to mean volume and price effects excluding the impacts of changes in FX rates and acquisitions/divestitures. * See Definition of Terms of Financial Measurements on pages 4 and 5. ** Clariant calculates ROIC by dividing NOPLAT before exceptional items by the average net capital employed. NOPLAT is calculated by taking the operating income before exceptional items adjusted by the expected tax rate. Net capital employed also considers operating cash and capitalized operating leases. *** Includes restructuring, impairment and transaction-related costs and gain/loss from the disposal of activities not qualifying as discontinued operations. See details on page 4.
Page 2 of 16 FINANCIAL DISCUSSION FULL YEAR Sales and Net Results 2016 Sales increased 2 % in local currency, of which 1 % organic growth. In Swiss francs sales increased with 1 %, compared to the previous year. The gross margin for the full year of 2016 was 30.2 % compared to 30.7 % recorded in the prior-year period, the reduction comes from the impact of exceptional items, excluding this effect the margin was comparable to last year. * Selling, general and administrative costs accounted for 19.4 % of sales and were below the 20.0 % level of the previous year period.* Research and development costs of CHF 206 million in the full year 2016 were consistent with the level recorded in the previous year (CHF 206 million).* Income from associates and joint ventures of CHF 86 million in the full year of 2016 was above the level of the previous year (CHF 76 million). The net financial result was CHF -174 million for the full year of 2016. Before foreign currency impacts, the financial result increased to CHF -109 million in the year 2016 from CHF -100 million in 2015 mainly due to changes in the debt profile as well as a one-time currency effect on the Euro Bond interests in 2015. Tax expense of CHF 75 million was recorded in the full year of 2016 compared to CHF 73 million tax expense recorded in the prior-year period. The resulting tax rate (22 %) is slightly lower than in the previous year and this is due to several factors including opportunities for the utilization of tax losses, higher profit in low tax jurisdictions and positive one-time events. Net income** amounted to CHF 263 million in the full year of 2016, which was above the CHF 227 million net income reported in the same period of 2015. * Includes restructuring, impairment and transaction-related costs and gain/loss from the disposal of activities not qualifying as discontinued operations. See details on page 4. ** from continuing operations
Page 3 of 16 Balance Sheet Key Figures December 2016 Total assets increased to CHF 8.365 billion as of 31 December 2016 from CHF 7.461 billion at the end of 2015. This increase is mainly due to the acquisition on 1 October 2016 of the North American oilfield production chemicals businesses Kel-Tech Inc. and X-Chem LLC and to the cash remaining from the launch of new certificates of indebtedness in April and August 2016. Intangibles increased to CHF 1.700 billion from CHF 1.350 billion mainly due to the acquisitions made in the United States in the Oil and Mining Services business. CHF 17 million, by the combined effect of actuarial losses on retirement benefit obligations and a positive return on pension plan assets amounting to a negative CHF 89 million, net of deferred tax and by negative currency translation differences amounting to CHF 24 million associated with change in the euro/ Swiss franc exchange rate mainly. Net debt increased to CHF 1.540 billion as of 31 December 2016, from CHF 1.312 billion at the end of 2015. This figure includes current and non-current financial debts, cash and cash equivalents, near cash assets and financial instruments with positive fair values reported under other current assets. Investments in associates and joint ventures decreased to CHF 516 million from CHF 586 million mainly due to equity repayment and dividends received from Stahl Lux. Gearing, which reflects net financial debt in relation to equity including non-controlling interests, increased to 60 % as of 31 December 2016 from 53 % at the end of December 2015. Near cash assets increased to CHF 277 million from CHF 152 million. They include short-term deposits with an original maturity between 90 and 365 days. Current financial debts increased to CHF 957 million as of 31 December 2016 from CHF 394 million at the end of 2015 mainly due to the reclassification from non-current financial debts to current financial debts of the 500 million Eurobond maturing in January 2017 and of the CHF 100 million straight bond maturing in June 2017. Additionally, in April 2016, new certificates of indebtedness were launched for a total amount of EUR 300 million with a term of 4 years (EUR 212 million), 7 years (EUR 73 million) and 10 years (EUR 15 million) respectively and in August 2016, new certificates of indebtedness were launched totaling USD 277 million with a term of 5 years and EUR 95 million with terms of 5 years and 7 years. These new certificates of indebtedness offset the impact of the reclassification from non-current financial debts to current financial debts of the certificates maturing in 2017. Equity increased to CHF 2.546 billion as of 31 December 2016 from CHF 2.494 billion at the end of 2015. This was mainly due to the net profit for the period amounting to CHF 263 million, to transactions with non-controlling interests amounting to CHF 29 million and to treasury shares transactions amounting to CHF 24 million, partially offset by a distribution from capital contribution reserves to equity holders amounting to CHF 129 million and to non-controlling interests amounting to Cash Flow Cash flow from operating activities was a positive CHF 646 million for the full-year of 2016 compared to a positive CHF 502 million for the full-year of 2015. Working capital increased by CHF 18 million in 2016, compared with an increase of CHF 68 million for the full prior year. Investments in PPE and investments in intangible assets were CHF 297 million and CHF 39 million respectively, for the full-year of 2016 compared to CHF 374 and CHF 27 million respectively, for the full-year of 2015. Acquisition of companies, businesses and participations for the full-year of 2016 mainly relates to business acquisitions in the United States in the Oil and Mining business (CHF 354 million), to a business acquisition in India in Personal Care (CHF 53 million) and to the acquisition of the remaining 50 % shares in a consortium in Brazil in the oil and gas business (CHF 8 million). CHF 6 million were spent on smaller scale acquisitions in Italy and in Australia. Financing activities mainly include the sale and purchase of treasury shares, distributions to the shareholders of Clariant and to non-controlling interests, proceeds from transactions with non-controlling interests, proceeds from and repayments of financial debt, and the related interests paid and received.
Page 4 of 16 DEFINITION OF TERMS OF FINANCIAL MEASUREMENTS (UNAUDITED) The following financial measurements are supplementary financial indicators. They should be considered in addition to, not as a substitute for, operating income, net income, operating cash flow and other measures of financial performance and liquidity reported in accordance with International Financial Reporting Standards (IFRS). EBITDA (Earnings Before Interest, Taxes, Depreciation and Amortization) is calculated as operating income plus depreciation of PPE, plus impairment and amortization of intangible assets, and can be reconciled from the Condensed Financial Statements as follows: EBITDA CHF m 2 016 2 015 Operating income 512 496 + Depreciation of property, plant and equipment 210 203 + Impairment 8 14 + Amortization of intangible assets 55 54 EBITDA 785 767 EBITDA before exceptional items is calculated as EBITDA plus expenses for restructuring, impairment and transaction-related costs less impairment and gain/ loss on disposals. EBITDA before exceptional items CHF m 2 016 2 015 EBITDA 785 767 + Restructuring, impairment and transaction-related costs* 107 115 Impairment (reported under Restructuring, impairment and transaction-related costs) 8 14 Loss/(gain) from the disposal of activities not qualifying as discontinued operations** 3 15 EBITDA before exceptional items 887 853 Operating income before exceptional items is calculated as operating income plus restructuring, impairment and transaction-related costs and gain/loss on disposals. Operating income before exceptional items CHF m 2 016 2 015 Operating income 512 496 + Restructuring, impairment and transaction-related costs* 107 115 Loss/(gain) from the disposal of activities not qualifying as discontinued operations** 3 15 Operating income before exceptional items 622 596 * Restructuring, impairment and transaction-related costs 2016: CHF 107 million (2015: CHF 115 million), of which: Costs of goods sold CHF 28 million (2015: CHF 2 million); Selling, general and administrative costs CHF 73 million (2015: CHF 110 million); Research and development CHF 7 million (2015: CHF 2 million); Income from associates and joint ventures CHF 1 million an income (2015: CHF 1 million an expense). **Gain/(loss) from the disposal of activities not qualifying as discontinued operations 2016: CHF 3 million loss (2015: CHF 15 million gain) reported under Selling, general and administrative costs.
Page 5 of 16 Adjusted earnings per share is the earnings per share adjusted for the impact of exceptional items, assuming an adjusted income tax rate of 26 % for the period (2015: 26 %). Adjusted earnings per share CHF m 2 016 2 015 Operating income before exceptional items 622 596 + Amortization of intangible assets 55 54 + Finance income 12 14 Finance costs 186 210 Adjusted income before taxes 503 454 Adjusted income taxes 131 118 Adjusted net income 372 336 Thereof attributable to non-controlling interests 10 10 Thereof attributable to shareholders of Clariant Ltd. 362 326 Weighted average number of shares outstanding 323 712 538 322 202 845 Adjusted earnings per share attributable to shareholders of Clariant Ltd (CHF/share) 1.12 1.01 Net debt is the sum of current and non-current financial debt less cash and cash equivalents, near-cash assets and financial instruments with positive fair values. Net debt CHF m 31.12.2016 31.12.2015 Non-current financial debt 1908 1859 + Current financial debt 957 394 Cash and cash equivalents 1043 789 Near-cash assets 277 152 Financial instruments with positive fair values 5 Net debt 1540 1 312
Page 6 of 16 CONDENSED FINANCIAL STATEMENTS OF THE CLARIANT GROUP Consolidated balance sheets ASSETS 31.12.2016 31.12.2015 CHF m CHF m Non-current assets Property, plant and equipment 2205 2083 Intangible assets 1700 1350 Investments in associates and joint ventures 516 586 Financial assets 71 77 Prepaid pension assets 36 47 Deferred income tax assets 298 256 Total non-current assets 4826 57.7 4399 59.0 Current assets Inventories 816 811 Trade receivables 1 011 934 Other current assets 344 328 Current income tax receivables 41 46 Near-cash assets 277 152 Cash and cash equivalents 1043 789 Total current assets 3532 42.2 3060 41.0 Assets held for sale 7 0.1 2 Total assets 8365 100.0 7461 100.0 EQUITY AND LIABILITIES 31.12.2016 31.12.2015 CHF m CHF m Equity Share capital 1228 1228 Treasury shares (par value) 29 34 Other reserves 229 382 Retained earnings 1033 841 Total capital and reserves attributable to Clariant shareholders 2 461 2 417 Non-controlling interests 85 77 Total equity 2546 30.4 2494 33.4 Liabilities Non-current liabilities Financial debts 1908 1859 Deferred income tax liabilities 33 71 Retirement benefit obligations 918 829 Provision for non-current liabilities 157 157 Total non-current liabilities 3 016 36.1 2 916 39.1 Current liabilities Trade and other payables 1228 1093 Financial debts 957 394 Current income tax liabilities 305 276 Provision for current liabilities 313 288 Total current liabilities 2 803 33.5 2 051 27.5 Total liabilities 5 819 69.6 4967 66.6 Total equity and liabilities 8365 100.0 7461 100.0
Page 7 of 16 Consolidated income statements CHF m 2 016 % CHF m 2 015 % Sales 5 847 100.0 5 807 100.0 Costs of goods sold* 4077 69.8 4022 69.3 Gross profit 1 770 30.2 1 785 30.7 Selling, general and administrative costs* 1138 19.4 1159 20.0 Research and development* 206 3.5 206 3.6 Income from associates and joint ventures* 86 1.5 76 1.3 Operating income 512 8.8 496 8.5 Finance income 12 0.2 14 0.2 Finance costs 186 3.2 210 3.6 Income before taxes 338 5.8 300 5.2 Taxes 75 1.3 73 1.3 Net income from continuing operations 263 4.5 227 3.9 Attributable to: Shareholders of Clariant Ltd 253 217 Non-controlling interests 10 10 Net income from discontinued operations 12 Attributable to: Shareholders of Clariant Ltd 12 Non-controlling interests Net income 263 239 Attributable to: Shareholders of Clariant Ltd 253 229 Non-controlling interests 10 10 Basic earnings per share attributable to the shareholders of Clariant Ltd (CHF/share): Continuing operations 0.78 0.67 Discontinued operations 0.04 Total 0.78 0.71 Diluted earnings per share attributable to the shareholders of Clariant Ltd (CHF/share): Continuing operations 0.78 0.67 Discontinued operations 0.04 Total 0.78 0.71 * includes restructuring, impairment and transaction-related costs and gain/loss from the disposal of activities not qualifying as discontinued operations. See details on page 4.
Page 8 of 16 Consolidated statements of comprehensive income CHF m 2 016 2 015 Net income 263 239 Other comprehensive income: Remeasurements: Actuarial gain/loss on retirement benefit obligations 261 39 Return on retirement benefit plan assets, excluding amount included in interest expense 146 32 Total items that will not be reclassified subsequently to the income statement, gross 115 7 Deferred tax on remeasurements 26 6 Total items that will not be reclassified subsequently to the income statement, net 89 1 Net investment hedge 6 66 Cash flow hedge 5 Currency translation differences 24 404 Share of other comprehensive income of associates and joint ventures 4 1 Effect of the reclassification of foreign exchange differences on previously held net investments in foreign entities 3 2 Total items that may be reclassified subsequently to profit and loss 26 339 Deferred tax effect Total items that will be reclassified subsequently to the income statement, net 26 339 Other comprehensive income for the period, net of tax 115 338 Total comprehensive income for the period 148 99 Attributable to: Shareholders of Clariant Ltd 136 110 Non-controlling interests 12 11 Total comprehensive income for the period 148 99 Total comprehensive income attributable to shareholders of Clariant Ltd arising from: Continuing operations 136 110 Discontinued operations Total comprehensive income attributable to shareholders of Clariant Ltd 136 110
Page 9 of 16 Consolidated statement of changes in equity Other reserves CHF m Total share capital Treasury shares (par value) Share premium reserves Hedging reserves Cumulative translation reserves Total other reserves Retained earnings Total attributable to equity holders Noncontrolling interests Total equity Balance 31 December 2014 1 228 45 1 577 725 852 574 2 609 124 2 733 Net income 229 229 10 239 Net investment hedge 66 66 66 66 Remeasurements: Actuarial gain on retirement benefit obligations 39 39 39 Return on retirement benefit plan assets, 32 32 32 excluding amount included in interest expense Deferred tax on remeasurements 6 6 6 Currency translation differences 405 405 405 1 404 Share in other comprehensive income of 1 1 1 associates and joint ventures Effect of the reclassification of foreign 2 2 2 2 exchange differences on previously held net investments in foreign entities Total comprehensive income for the period 341 341 231 110 11 99 Distributions 129 129 129 129 Dividends to non-controlling interests 37 37 Share buyback of non-controlling interests 21 21 Clariant (India) Ltd Employee share & option scheme: Effect of employee services 13 13 13 Treasury share transactions 11 23 34 34 Balance 31 December 2015 1 228 34 1 448 1 066 382 841 2 417 77 2494 Net income 253 253 10 263 Cash flow hedge 5 5 5 5 Net investment hedge 6 6 6 6 Remeasurements: Actuarial loss on retirement benefit obligations 261 261 261 Return on retirement benefit plan assets, 146 146 146 excluding amount included in interest expense Deferred tax on remeasurements 26 26 26 Currency translation differences 26 26 26 2 24 Share in other comprehensive income of associates and joint ventures 4 4 4 Effect of the reclassification of foreign 3 3 3 3 exchange differences on previously held net investments in foreign entities Total comprehensive income for the period 5 29 24 160 136 12 148 Distributions 129 129 129 129 Dividends to non-controlling interests 17 17 Transactions with non-controlling interests 16 16 13 29 Employee share & option scheme: Effect of employee services 3 3 3 Treasury share transactions 5 19 24 24 Balance 31 December 2016 1 228 29 1 319 5 1 095 229 1 033 2 461 85 2 546
Page 10 of 16 Consolidated statements of cash flows CHF m 2 016 2 015 Net income 263 239 Adjustment for: Depreciation and amortisation 265 257 Impairment and reversal of impairment 8 14 Impairment of working capital 24 52 Income from associates and joint ventures 85 77 Tax expense 75 74 Net financial income and costs 109 100 Loss/ (gain) from the disposal of activities not qualifying as discontinued operations 3 15 Loss on disposal of discontinued operations 2 Other non-cash items 20 41 Total reversal of non-cash items 419 448 Dividends received from associates and joint ventures 85 57 Income taxes paid 66 96 Payments for restructuring 37 78 Cash flow before changes in working capital and provisions 664 570 Changes in inventories 20 28 Changes in trade receivables 80 79 Changes in trade payables 17 39 Changes in other current assets and liabilities 12 7 Changes in provisions (excluding payments for restructuring) 53 7 Cash flow from operating activities 646 502 Investments in property, plant and equipment 297 374 Investments in intangible assets 39 27 Investments in financial assets, associates and joint ventures 8 Sale of property, plant and equipment and intangible assets 43 7 Changes in near-cash assets 127 23 Change in current financial assets 11 16 Business acquisitions 421 22 Proceeds from equity repayment of associates and financial assets 69 Proceeds/ payments associated to disposals of activities not qualifying as discontinued operations 3 74 Cash flow from investing activities 772 335 Purchase of treasury shares 15 21 Sale of treasury shares 22 55 Distributions from the reserves to the shareholders of Clariant Ltd 129 129 Dividends paid to non-controlling interest 17 37 Proceeds/ payments associated to transactions with non-controlling interests 29 21 Proceeds from financial debts 794 497 Repayments of financial debts 188 350 Interest paid 97 90 Interest received 12 12 Cash flow from financing activities 411 84 Currency translation effect on cash and cash equivalents 31 42 Net change in cash and cash equivalents 254 41 Cash and cash equivalents at the beginning of the period 789 748 Cash and cash equivalents at the end of the period 1043 789
Page 11 of 16 NOTES TO THE CONDENSED FINANCIAL STATEMENTS (UNAUDITED) 1. Basis of preparation of financial statements 4. Acquisition activities These financial statements are the condensed consolidated financial statements (hereafter the consolidated financial statements ) of Clariant Ltd, a company registered in Switzerland, and its subsidiaries (hereafter the Group ) for the twelve-month period ended on 31 December 2016. The condensed consolidated financial statements, which do not contain all the information that International Financial Reporting Standards (IFRS) would require for a full set of financial statements, have been prepared in accordance with IFRS and with the accounting policies set out in the Clariant Financial Report for the year ended 2016. None of the new standards, amendments or interpretations effective for the financial year starting 1 January 2016 has a material impact for the Clariant Group and the accounting policies applied are consistent with the ones applied at year-end 2015. These consolidated financial statements were approved on 14 February 2017 by the Board of Directors. The preparation of the financial statements requires management to make estimates and assumptions that affect the reported amounts of revenues, expenses, assets, liabilities, and disclosure of contingent liabilities at the date of the consolidated financial statements. If, in the future, such estimates and assumptions, which are based on the management s best judgment at the date of the consolidated financial statements, deviate from the actual circumstances, the original estimates and assumptions will be modified as appropriate in the year in which the circumstances change. 2. Seasonality of operations The Group operates in industries where significant seasonal or cyclical variations in total sales are not experienced during the financial year. 4.1 Acquisition of Vivimed personal care portfolio On 8 January 2016, Clariant acquired the specialty chemicals segment of Vivimed Labs Ltd, India. This acquisition complements Clariant global strategy to enhance its offering in personal care and to boost its presence in Asia. It will also strengthen the active ingredients portfolio of Clariant in India. The estimated consideration totals CHF 53 million. The assets acquired mainly consist of customer relationships, technical knowhow and intellectual properties. The preliminary goodwill generated amounts to CHF 21 million. 4.2 Acquisition of the remaining shares in the consortium with Carboflex. On 13 June 2016, Clariant acquired the Carboflex 50 % stake in the consortium that built and operates a plant in Rio de Janeiro in Brazil to produce chemicals used in oil and gas wells. The purchase price of the remaining 50 % shares totals CHF 11 million out of which CHF 8 million were paid in June 2016 and the remaining CHF 3 million are held back for potential indemnifications for obligations assumed by Clariant on behalf of Carboflex. The assets acquired mainly consist of customer relationship and property, plant and equipment. This transaction was treated as a two-step acquisition. Therefore the 50 % shares already held are re-measured to fair value as well as the acquisition of the remaining 50 % shares. This resulted in a positive income statement impact of CHF 7 million and the generated goodwill is immaterial. 4.3 Acquisition of Kel-Tech Inc. and X-Chem LLC in North America 3. Fair value measurement All derivative financial instruments held by the Group at the end of December 2016 are classified as Level 2 as defined by IFRS 13 Fair Value Measurement. On 1 October 2016, Clariant acquired from Arsenal Capital Partners 100 % of the shares of Kel-Tech Inc. for a total consideration estimated at CHF 224 million, out of which CHF 203 million were paid in 2016. The acquired company is based in Midland, Texas, USA and is a manufacturer and supplier of specialty chemicals for production, field stimulation and drilling applications in the oil service business throughout onshore United States.
Page 12 of 16 The assets acquired mainly consist of customer relationships, technical know-how, property, plant and equipment and working capital. The preliminary goodwill amounts to CHF 133 million. This is subject to change until the external valuation and the purchase price allocation are finalized in 2017. Additionally, on 1 October 2016, Clariant acquired from NCH Corporation the activities of X-Chem LLC in a combined asset and share deal for a total consideration of CHF 140 million. The acquired company is based in Irving, Texas, USA and is a provider of specialty oilfield chemicals for the production, completion and stimulation of oil wells, gas wells and pipelines focused on land and offshore United States. The assets acquired mainly consist of customer relationships, technical know-how, property, plant and equipment and working capital. The preliminary goodwill amounts to CHF 14 million. This is subject to change until the external valuation and the purchase price allocation are finalized in 2017. 7. Launch of new certificates of indebtedness On 26 April 2016, Clariant issued four certificates of indebtedness with a total amount of EUR 300 million. These certificates have a term of 4 years (EUR 212 million), 7 years (EUR 73 million) and 10 years (EUR 15 million) respectively. The interest varies between 1.012 % and 2.010 %. On 5 August 2016, Clariant issued five certificates of indebtedness with a total amount of EUR 95 million and USD 277 million. These certificates have terms of 5 years (EUR 55 million and USD 277 million) and 7 years (EUR 40 million). The interest varies between 0.779 % and 2.618 %, while a tranche of EUR 13 million has a variable interest of 6 months EURIBOR plus 1.1 % and a tranche of USD 166 million has a variable interest of 3 months LIBOR plus 1.5 %. These acquisitions should accelerate Clariant s growth as a leading provider of oilfield production chemicals in North America. 5. Restructuring, impairment and transactionrelated costs During 2016, Clariant recorded restructuring expenses in the amount of CHF 53 million, mainly pertaining to projects in Europe, impairment in the amount of CHF 8 million and transaction-related costs in the amount of CHF 46 million. In the previous year, restructuring, impairment and transactionrelated costs totaled CHF 115 million. 6. Distribution from reserves On 21 April 2016, the Annual General Meeting of Clariant Ltd approved a distribution of CHF 0.40 per registered share from capital contribution reserves. On 28 April 2016, a distribution totaling CHF 129 million was made to Clariant shareholders.
Page 13 of 16 8. Business Area figures Sales to 3rd parties EBITDA before exceptionals EBITDA CHF m 2 016 2 015 % CHF % LC 2 016 2 015 % CHF % LC 2 016 2 015 % CHF % LC Care Chemicals 1465 1445 1 5 276 272 1 2 266 266 1 Catalysis 673 704 4 8 160 177 10 12 154 189 19 21 Natural Resources 1 184 1 217 3 2 200 206 3 2 186 208 11 6 Plastics & Coatings 2525 2 441 3 4 368 313 18 17 351 303 16 15 Business Areas total 5 847 5807 1004 968 957 966 Corporate 117 115 172 199 Total 5 847 5807 1 2 887 853 4 5 785 767 2 3 Operating income before exceptionals Operating income Systematic depreciation of PPE CHF m 2 016 2 015 % CHF % LC 2 016 2 015 % CHF % LC 2 016 2 015 Care Chemicals 221 226 2 1 211 220 4 3 49 42 Catalysis 113 127 11 14 102 139 27 29 30 33 Natural Resources 159 171 7 1 145 173 16 11 27 24 Plastics & Coatings 289 234 24 23 269 211 27 27 69 68 Business Areas total 782 758 727 743 175 167 Corporate 160 162 215 247 35 36 Total 622 596 4 6 512 496 3 5 210 203 9. Business Area margins Sales to 3rd parties EBITDA before EBITDA exceptionals in % 2 016 2 015 2 016 2 015 2 016 2 015 Care Chemicals 25.1 24.9 18.8 18.8 18.2 18.4 Catalysis 11.5 12.1 23.8 25.1 22.9 26.8 Natural Resources 20.2 21.0 16.9 16.9 15.7 17.1 Plastics & Coatings 43.2 42.0 14.6 12.8 13.9 12.4 Total 100.0 100.0 15.2 14.7 13.4 13.2 Operating income Operating income b. exceptionals in % 2 016 2 015 2 016 2 015 Care Chemicals 15.1 15.6 14.4 15.2 Catalysis 16.8 18.0 15.2 19.7 Natural Resources 13.4 14.1 12.2 14.2 Plastics & Coatings 11.4 9.6 10.7 8.6 Total 10.6 10.3 8.8 8.5
Page 14 of 16 10. Condensed earnings per share data 2 016 2 015 Net income attributable to shareholders of Clariant Ltd (CHF m) Continuing operations 253 217 Discontinued operations 12 Total 253 229 Shares Number of registered shares at 31.12.2016 and 31.12.2015 respectively 331 939 199 331 939 199 Weighted average number of shares outstanding 323 712 538 322 202 845 Adjustment for granted Clariant shares 1645919 2089675 Adjustment for dilutive share options 16 322 90692 Weighted average diluted number of shares outstanding 325 374 779 324 383 212 Basic earnings per share attributable to shareholders of Clariant Ltd (CHF/share) Continuing operations 0.78 0.67 Discontinued operations 0.04 Total 0.78 0.71 Diluted earnings per share attributable to shareholders of Clariant Ltd (CHF/share) Continuing operations 0.78 0.67 Discontinued operations 0.04 Total 0.78 0.71
Page 15 of 16 11. Finance income and costs Finance income in CHF m 2016 2015 Interest income 9 11 Other financial income 3 3 Total finance income 12 14 Finance costs in CHF m 2016 2015 Interest costs 109 104 thereof effect of discounting of non-current provisions 4 4 thereof interest component of pension provisions 19 18 Other financial expenses 12 10 Currency result, net 65 96 Total finance costs 186 210 12. Foreign exchange rates Rates used to translate the consolidated balance sheets (closing rate) 31.12.2016 31.12.2015 Change % 1 USD 1.02 0.99 3 1 EUR 1.07 1.08 1 1 BRL 0.31 0.25 24 1 CNY 0.15 0.15 100 INR 1.50 1.50 100 JPY 0.87 0.82 6 Average sales-weighted rates used to translate the consolidated income 2 016 2 015 Change % statements and consolidated statements of cash flows 1 USD 0.99 0.96 3 1 EUR 1.09 1.07 2 1 BRL 0.28 0.29 3 1 CNY 0.15 0.15 100 INR 1.47 1.50 2 100 JPY 0.91 0.80 14
Page 16 of 16 CLARIANT WHAT IS PRECIOUS TO YOU? Clariant is a globally leading specialty chemicals company, based in Muttenz near Basel/Switzerland. On 31 December 2016, the company employed a total workforce of 17 442. In the financial year 2016, Clariant recorded sales of CHF 5.847 billion for its businesses. Clariant s corporate strategy is based on five pillars: focus on innovation through R&D, add value with sustainability, reposition the portfolio, intensify growth, and increase profitability. The company reports in four Business Areas: Care Chemicals, Catalysis, Natural Resources, and Plastics & Coatings. www.clariant.com Calendar of Corporate Events Your Clariant Contacts 20 March 2017 Annual General Meeting 27 April 2017 First Quarter 2017 Sales and EBITDA 27 July 2017 Half Year 2017 Results 31 October 2017 Nine Months 2017 Sales and EBITDA Investor Relations Fax +41 61 469 67 67 Anja Pomrehn Tel. +41 61 469 67 45 Steven Massheder Tel. +41 61 469 68 58 Maria Ivek Tel. +41 61 469 62 92 Media Relations Fax +41 61 469 69 99 Jochen Dubiel Tel. +41 61 469 63 63 Thijs Bouwens Tel. +41 61 469 63 63 Disclaimer This document contains certain statements that are neither reported financial results nor other historical information. This presentation also includes forward-looking statements. Because these forward-looking statements are subject to risks and uncertainties, actual future results may differ materially from those expressed in or implied by the statements. Many of these risks and uncertainties relate to factors that are beyond Clariant s ability to control or estimate precisely, such as future market conditions, currency fluctuations, the behavior of other market participants, the actions of governmental regulators and other risk factors such as: the timing and strength of new product offerings; pricing strategies of competitors; the Company s ability to continue to receive adequate products from its vendors on acceptable terms, or at all, and to continue to obtain sufficient financing to meet its liquidity needs; and changes in the political, social, and regulatory framework in which the Company operates or in economic or technological trends or conditions, including currency fluctuations, inflation, and consumer confidence, on a global, regional, or national basis. Readers are cautioned not to place undue reliance on these forwardlooking statements, which pertain only as of the date of this document. Clariant does not undertake any obligation to publicly release any revisions to these forward-looking statements to reflect events or circumstances after the date of these materials.