conzzeta

2003Annual Report

Over the last few years, our annual reports havegiven readers an insight into the world ofConzzeta from diverse angles – through ouremployees, in the different facets of customerrelations or from a technical viewpoint.This time the images show some surprisingsides of Conzzeta: finished products as they areused or applied in everyday life and to whichwe have contributed in some way through theactivities of our operational units.It fills us with pride that there are so many areas of life in which we have so much incommon – a fact many will not have expected.

CONZZETA IN EVERYDAY LIFE

CoverThis structural part made from sheet steel features a high loadingcapacity. It was produced in a single bending process, without retooling,using Bystronic’s innovative three-point bending technology.

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Key figuresOverview of Group developmentForewordCorporate agentsManagement structureOverview of the 2003 business year

Machinery and Systems EngineeringConsumer and Industrial ProductsReal Estate and Other Industrial ActivitiesCorporate Services

Corporate governance

Consolidated income statementConsolidated balance sheetConsolidated cash flow statementConsolidated statement of value addedNotes to the consolidated financialstatementsEmployee pension funds, SwitzerlandList of major consolidated companiesby business unitAuditors’ report

Income statementBalance sheetNotes to the financial statementsAdditional information on thefinancial statementsProposed appropriation of availableearnings by the Board of DirectorsStatutory auditors’ report

Net revenue from 1999 to 2003Five-year summary

Information for investors

TABLE OF CONTENTS

Group 234679

Group business areas 131927

31

32

Financial sectionGroup 37

38404142

5354

56

Holding company 57586061

62

63

6466

68

KEY FIGURES

2003 2002

Group

Net revenue in CHF m 916.6 909.3Operating result in CHF m 15.8 34.9Group profit in CHF m 22.8 45.1Operating cash flow in CHF m 56.0 63.1

Shareholders’ equity in CHF m 683.8 674.9Total assets in CHF m 933.6 929.6Shareholders’ equity as % of total assets % 73.2 72.6

Investments in property, plant and equipment in CHF m 32.3 67.6Number of employees at year-end Number 2 838 2 831Net revenue per employee in CHF thousand 318.9 337.5

Holding company

Net income for the year in CHF m 12.1 62.9Share capital in CHF m 46.0 50.0Total dividend in CHF m 9.2 1 11.5

Number of shares on 12/31 bearer 406 000 3 446 000 2

registered 270 000 270 000Gross dividend per share bearer (par CHF 100) CHF 20.00 1 25.00

registered (par CHF 20) CHF 4.00 1 5.00Market price per share bearer high/ low CHF 1015/770 1210/855

year-end CHF 980 940

Total capitalization on 12/31 in CHF m 450 450

Group key figures per share(on dividend-bearing capital)

Group profit per share bearer CHF 49.70 94.10registered CHF 9.90 18.80

Net cash flow from operating bearer CHF 61.00 144.40activities per share registered CHF 12.20 28.90

Shareholders’ equity bearer CHF 1489.80 4 1472.90 4

per share registered CHF 298.00 4 294.60 4

1 As proposed by the Board of Directors

2 Of these, 41800 are treasury bearer shares, of which 21000 have neither voting nor dividend rights

3 Of these, 1000 are treasury bearer shares with neither voting nor dividend rights

4 Not including treasury bearer shares

2

3

01 02 03

Group profit(in CHF million)

01 02 03

OVERVIEW OF GROUP DEVELOPMENT

Net revenue(in CHF million)

916.

6

909.

3

972.

9

Operating result(in CHF million)

01 02 03

34.9

15.8

64.5

Number of employeesat year-end

01 02 03

2831

2838

2513

extraordinary profit

ordinary Group profit

55.8

45.1

22.8

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FOREWORD

In the difficult economic climate of 2003, management and employeesfaced some tough challenges.We would like to start by expressing ourheartfelt thanks to them for their tremendous efforts. Alongside the con-duct of day-to-day business, they had to cope with some demandingchanges.The financial benchmark figures for 2003 are unsatisfactory: acquisitionscontributed to a slight increase in revenues, but earnings showed a sub-stantial decrease. Excluding the extraordinary revenues, Group profit fellto only CHF 10 million.The year was characterized by a marked slump indemand for capital goods and a more subdued mood among con-sumers, which had a dampening effect on revenues. However, it was notpossible to reduce costs at the same rate.As a result of the decline in profits, we are proposing to the shareholders’meeting that a reduction be made in the dividend, with the aim ofpreserving Conzzeta’s rock-solid balance sheet.The reporting year alsosaw important strategic decisions. In our industrial core business wemade three acquisitions which enabled us to strengthen our position inthe Glass Processing Systems, Foam Materials and Sporting Goods busi-ness units.We also made some significant organizational changes toensure smooth integration of the new activities, reduce structural costs,simplify the organization and adjust capacity.The measures taken will notimpair the longer-term development of the Conzzeta Group.On the whole, the Conzzeta Group has emerged stronger from this diffi-cult year. In the anticipated economic upturn, the various measures toincrease productivity will be reflected in improved results.Continuing development of innovative products in all industrial businessunits and the building of a worldwide distribution and service network in both machine engineering divisions are also to be seen as investmentsin the future.

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Though the business climate in the relevant markets is likely to improvesomewhat in 2004, we do not expect a marked upswing.The persistentweakness of the US dollar is making exports from the Swiss franc andEuro areas increasingly difficult. Raising productivity, seizing market op-portunities and shepherding the Group’s financial resources remain important tasks and challenges. Innovative products and services, as wellas internal processes and working practices, are the driving force forfuture growth.We must make further progress in these areas and respondmore quickly to new challenges.Despite our subdued assessment of the economic prospects, we look for-ward to the future with confidence, safe in the knowledge that we cancount on competent and highly motivated management and personnelas well as solid financial fundamentals.

Jacob Schmidheiny Heinrich M. LanzChairman of the Board of Directors Chairman of the Group

Executive Board

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Board of Directors(elected until 2005)

Secretary of the Board

Auditors

Jacob Schmidheiny Chairman

Christoph SpoerryVice Chairman

Matthias Auer

Thomas W. Bechtler

Werner Dubach

Robert F. Spoerry

Fabio Sorgesa

KPMG Fides Peat, Zurich

CORPORATE AGENTS

From left to right: Werner Dubach, Matthias Auer, Thomas W. Bechtler, Christoph Spoerry, Robert F. Spoerry and Jacob Schmidheiny.

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Corporate Services

Group business areas

Machinery and Systems Engineering

Consumer and Industrial Products

Real Estate and Other Industrial Activities

Chairman of the Group Executive BoardHeinrich M. Lanz

Corporate Development and Group SecretariatFabio Sorgesa

Group FinancesArnold P. Huber

Pension FundsMarc Sutter

Business units

Sheet Metal Processing Systems Laser cuttingFerdi Töngi Bending

Water-jet cutting

Glass Processing Systems Architectural glassRolf Honegger Automotive glass

Foam MaterialsHeinz Dürrenberger

Sporting GoodsRolf G. Schmid

Coating Materials Architectural paintsMartin Holenweg Print finishing

Noise control

Real Estate Real estate management Ralph Siegle Building trust

Other Industrial Activities Production automationConcrete prefabrication

MANAGEMENT STRUCTUREAS OF APRIL 1, 2004

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Distribution of net revenues for the Group in 2003

TOUGH CLIMATE AND EXTRA COSTS SQUEEZE PROFITSOVERVIEW OF THE 2003 BUSINESS YEAR

Total CHF 916.6 million / 100%

Foam Materials CHF 127.1 million/13.9%

Sporting GoodsCHF 114.2 million/12.4%

Coating Materials CHF 101.7 million/11.1%

Real Estate and miscellaneous revenueCHF 20.6 million/2.2%

Other Industrial ActivitiesCHF 26.5 million/2.9%

Sheet Metal Processing SystemsCHF 369.0 million/40.3%

Glass Processing Systems CHF 157.5 million/17.2%

Recovery in the closing months of 2003The economic situation in 2003 was difficult and –except in Asia – the readiness to invest was low.Therewas also evidence of stagnation in the consumer goodssector.Towards the end of the year, signs of recoveryemerged in the USA as well as in the Euro zone andSwitzerland, important markets for the Conzzeta Group.In 2003 the Conzzeta Group increased its revenuesoverall by 0.8% to CHF 916.6 million (previous year:CHF 909.3 million). On a comparable basis, i.e. adjusted for acquisition, divestment and currency effects, Grouprevenues were up by 0.7%. Although sales picked upnoticeably in the last few months of the reporting year,the Group’s results were hit by pricing pressure, lowcapacity loading and restructuring costs.

Acquisition-related revenue growthIn the Sheet Metal Processing Systems business unit, rev-enue rose by 3% thanks to the first full-year consolidationof the newly acquired Beyeler Group. New orders haveshown an upward trend since the summer of 2003.TheGlass Processing Systems business unit increased sales by 4.6% as the result of an acquisition. Investments inproduct innovation and the development of the distribu-tion network are beginning to pay off and will continue.The Foam Materials business unit saw a pleasing growth

of noise-protection applications in the automotive indus-try. As a result of this, of the first-time consolidation of thenewly acquired Büttikofer AG, and of the positive effectof the Euro exchange rate, revenue increased by 6%.Revenue growth of 8% in the Sporting Goods businessunit was achieved thanks to the Raichle footwear busi-ness which has been part of the Mammut Sports Groupsince spring 2003.In the Coating Materials business unit, the continued slow-down in the Swiss architectural paints market and thedifficult situation in the printing industry resulted in aslight drop in revenues.The sales decline in Other Industrial Activities was due tothe sale of Hard AG as of November 1, 2002, and the fall-off in sales after an extremely good prior year at RobertSeckler AG (production automation systems).The Real Estate business unit achieved its targets andslightly increased its revenues.The basic structure of Group revenues is unchangedcompared with 2002: 57% of revenues were generated in Machinery and Systems Engineering.The internationalorientation of the businesses was further strengthened,with sales abroad growing to 75%.The breakdown ofrevenues by region shows the following picture:Switzerland 25%, Germany 14%, rest of Europe 38%,North America 11% and other continents 12%.

Conzzeta from head to foot – outdoor clothing from Mammutand Raichle, protected by the varied range of Toko products.

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Measures affecting net income in the futureThe operating result (EBIT) fell to CHF 15.8 million – onlyabout half the previous year’s figure of CHF 34.9 million.The sharp drop in demand for capital goods and arestrained mood in consumer markets put pressure onrevenues.We responded to these trends with capacityadjustments and cost-containment measures which gaverise to non-recurring costs.These measures will have apositive effect on the Group result in 2004. Material costswere reduced by improved resourcing.The operating margin fell to 1.8% (previous year: 3.8%).The net value added per employee fell as a consequence.Sale of real estate generated extraordinary revenues ofCHF 12.9 million. Group profit dropped to CHF 22.8 mil-lion (previous year: CHF 45.1 million).

Financing and liquidityThe proportion of shareholders’ equity increased slightlyagain, reaching 73.2% at the end of 2003 (previous year:72.6%). On December 31, 2003, the Group’s liquid assetswere CHF 89.3 million (previous year: CHF 132.6 million).By comparison, interest-bearing liabilities stood atCHF 3.7 million (previous year: CHF 17.4 million).The difficult business climate and lower profit levels ledto a CHF 7.1 million fall in operating cash flow. Com-bined with the marked jump in trade receivables, thisproduced a net cash flow from operating activities ofCHF 28.0 million, CHF 41.2 million down on the previousyear’s figure.The net cash flow from investing activitieswas on a par with the 2002 level, resulting in a free cash

flow of CHF –13.6 million (previous year: CHF 27.1 million).The repayment of liabilities and dividend payments ledto a net outflow of funds due to financing activities ofCHF 24.8 million. All the financing requirements werecovered by liquid assets.

Investments and acquisitionsAfter completion of infrastructure projects vital to theGroup’s future in 2002, capital expenditure fell in 2003 toCHF 32.3 million. Of this, CHF 15.5 million was spent inSwitzerland, CHF 12.7 million in Germany, CHF 1.8 millionin China and CHF 2.3 million in other countries.In the reporting year, the biggest Group company,Bystronic Laser AG, introduced SAP R/3 as its new ERPsystem. In 2004 it is planned to implement SAP atBystronic Maschinen AG and Beyeler Maschinenbau GmbHin Gotha, Germany.Work on doubling the productioncapacity at the Sheet Metal Processing Systems plant inTianjin, China, is also due to be completed in 2004.At the FoamPartner plant in Leverkusen, Germany, thestore for 24-hour conditioning was extended in 2003 anda recently acquired industrial site in the immediate vicin-ity was developed as a new foam processing center.The current year has seen the start-up of the extension ofthe foam production and reticulation works at Wolf-hausen, Switzerland.Expansion of the EU central warehouse for sportinggoods in Memmingen, Germany, is under considerationto ensure optimal operations of this growing business.

Employees by business unit

2003 2002 2001

Sheet Metal Processing Systems 1 110 1 148 812Glass Processing Systems 618 574 559Foam Materials 447 400 377Sporting Goods 250 225 241Coating Materials 266 307 281Real Estate 6 9 8Other Industrial Activities 141 168 235

Total employees 2 838 2 831 2 513

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The reporting year saw acquisitions in various sectorsaimed at rounding off the product range.The Glass Pro-cessing Systems business unit acquired the Germancompany Armatec Vierhaus GmbH, which specializes inthe manufacture of laminated safety glass and glass han-dling equipment.The Foam Materials business unit ex-tended its activities in the packaging segment by acquir-ing Büttikofer AG, Switzerland.The acquisition of therenowned footwear brand Raichle, with effect from April 1, 2003, represented an ideal complement to theoffering of sporting goods specialist Mammut.

EmployeesAt the end of 2003, the Conzzeta Group had 2838 em-ployees; 1541 of these were based in Switzerland, 709 inGermany and 588 in other countries.The increase inGlass Processing Systems, Foam Materials and SportingGoods was largely due to acquisitions. Declining sales atSheet Metal Processing Systems, Glass Processing Sys-tems, Coating Materials and Robert Seckler AG resulted injob cutbacks.

Staff changesAfter a long and successful career with the ConzzetaGroup and 20 years at the helm of the Real Estate busi-ness unit, Heinz Graf retired at the end of August 2003.He is succeeded by Ralph Siegle.At Sheet Metal Processing Systems, Christoph Schüpbachtook over responsibility for the Europe North/East marketregion, Paul Ganzeboom became head of the bendingdivision, and Jean-Pierre Neuhaus head of corporate com-munications in the business unit management. In theGlass Processing Systems business unit,Volker Abt, CEOof Lenhardt Maschinenbau GmbH, left the Company witheffect from November 2003. Rolf Honegger, head of thebusiness unit, has taken over as interim head of Lenhardt.Rolf G. Schmid, previously CEO at Mammut Sports GroupAG, took over as head of the Sporting Goods business unitat the beginning of 2004.This means that Heinz Dürren-berger can now concentrate on the management of theFoam Materials business unit. At Mammut Sports Group,Willy Beyeler is now responsible for the Mammut brandand Stefan Merkt for the Raichle brand.Markus Keller has succeeded Jacqueline Kipfmüller-Gaig-nat as head of Siegfried Keller AG.

Pension funds in SwitzerlandThe number of currently employed fund participantsdecreased from 1977 to 1731.The decrease is partly dueto the exclusion of the employees of two participatingcompanies.The number of persons drawing retirementbenefits increased from 820 to 846.The dedicated fundcapital decreased by 2.9% to CHF 364.0 million. Contribu-tions from the participating companies and their em-ployees came to CHF 25.9 million.In the reporting year, the employer’s foundation financedbridging payments for early retirement totaling aroundCHF 1.6 million.The total net fund assets decreased fromCHF 436.3 million to CHF 427.3 million.Following the stock market slump of recent years, 2003brought a distinct recovery.This made it possible toincrease the asset value fluctuation reserves by CHF 5.5million to CHF 26.2 million, though that is still below thelong-term goal.As of January 1, 2004, the fund participants of BüttikoferAG were integrated into the pension funds.

Trends and outlookThere are signs of recovery in the target markets of theConzzeta Group companies, particularly in the area of investment activity. New orders in the Machinery andSystems Engineering business area showed an upturn.The Group’s business units have strong brands and arewell positioned in their respective markets.The weaknessof the US dollar will have a negative effect on exports toNorth America as well as to other dollar-dependentmarkets.Overall, we expect moderate sales growth in 2004, partic-ularly in Europe.The measures taken to strengthen ourmarket presence and increase productivity, whose effectswere not yet fully apparent in 2003, as well as the intro-duction of new products, will strengthen the earningssituation in 2004 and beyond.

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The Sheet Metal Processing Systems and GlassProcessing Systems business units togetheraccount for 57% of Group revenues.Both business units are active worldwide.A network of sales outlets and customer serviceoffices, complemented by competent agencies,ensures a presence close to customers in all theimportant markets.The business units offercustomers efficient, high-quality processing ofsheet metal and glass thanks to technologicallyadvanced, innovative machinery and systems.Both business units have been through toughtimes recently – notably because of customers’reluctance to invest in new equipment and thegeneral downturn in the capital goods sector.Investments in the distribution network andinfrastructure as well as the acquisitions madeduring 2003 stand in contrast to stagnatingsales. Numerous cost-cutting measures were in-troduced; unfortunately, some job cuts wereunavoidable as well.The deteriorating earningssituation in Machinery and Systems Engineeringhad a negative impact on the Group result.In Sheet Metal Processing Systems, the inflow of new orders began to pick up in the reportingyear.

MACHINERY AND SYSTEMS ENGINEERING

Bystronic’s laser cutting and press brakes make many of the steel components that are required for escalators – such as the ones picturedhere at Zurich Airport.

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Product innovation – added value for customersThe second half of the year saw the market launch ofinnovative products in all three technological areas, offer-ing customers significant added value.The new 5.2 kW laser source, 5200 ARC, gives Bystronic a renewed technological lead in terms of laser perform-ance and system control.Thanks to its ARC (adaptiveradius control) function it is also unmatched in laserbeam optimization for improved cutting performanceand quality, whatever the type and thickness of the material.The bending division launched a new series of Bystronic-Beyeler press brakes with IPC (integrated processcontrol), a unique, fully automated measurement andcompensation system which corrects process influencesduring bending.The integrated process software,Bybend, was further refined to reduce programmingcosts in laser cutting and bending.Development efforts in water-jet cutting were furtherintensified; a water-jet machine with automatic loadingwas introduced to the market.This combination made itpossible to achieve a massive increase in productivityand labor-efficient operation.These product innovations will positively impact salesand earnings in the current year.

From left: Christoph Schüpbach, Urs Singer, Christian Zürcher, Ferdi Töngi,

Jürg Sutter, Johann Ifanger, Paul Ganzeboom, Jean-Pierre Neuhaus,

Florian Stoffel and Ulrich Trösch.

INCREASE IN PRODUCTIVITYSHEET METALPROCESSING SYSTEMS

The Sheet Metal Processing Systems business unit com-bines the activities of Bystronic Laser, Beyeler and AFM,offering technologies for laser cutting and bending aswell as water-jet machinery.

Sales hold firm in a difficult environmentIn 2003, revenues by the Sheet Metal Processing Systemsbusiness unit were slightly higher than the previous yearat CHF 369 million.This 3% increase, partly due to firsttime full consolidation of Beyeler Group, was achieved ina difficult operating environment.Despite various measures to reduce operating costs, itwas not possible to offset completely the volume- andmarket-related narrowing of margins.The operatingresult was therefore below expectations. Spending onproduct development and market expansion increasedagain compared with the previous year.The different regions showed a varied pattern of devel-opment in the reporting year. In terms of local currencies,sales held firm in the USA, and grew once more in Asia.Despite a good performance in the final four months of the year, sales in Europe did not quite match up to theprevious year.

Further strengthening of the market presenceThe direct distribution system for key markets, announ-ced last year, was implemented.The sales figuresachieved are a vindication of the investment involved.The introduction of Beyeler and AFM bending pressesinto the US market exceeded all expectations. Productioncapacity in China is set to double in the current year toensure that the strong demand for locally manufacturedproducts can be satisfied. In eastern Europe and Russia,the business unit is strengthening specific sales and ser-vice resources.There are also plans to strengthen marketpresence in Brazil.Laser technology continues to promise strong growth inthe emerging markets.In Europe and the USA, productivity improvements andprocess integration are in demand for the “cutting-bend-ing-automation”chain.

Revenue(in CHF million)

01 02 03

Capital investments (in CHF million)

01 02 03

Number of employees at year-end

01 02 03

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Measures to improve resultsThe measures implemented in the reporting period ledto the desired reduction in fixed costs without under-mining future prospects.In the current year it is planned to reduce material costsby developing new supply sources in low-cost countries.At the same time, inhouse production will be strength-ened in particular segments.With a material quota ofover 50%, this will contribute to a significant improve-ment in the operating result.The Swiss production centeris conducting a project to improve output, while Beyeleris installing a new IT system.In all technologies there will be a marked increase indevelopment expenditure during the current year inorder to keep up with the ever-increasing pace of inno-vation.

OutlookInvestment activity of our customers, including those inEurope, started to pick up gradually in mid-2003. Neworders showed a pleasing upturn in the second third of2003.We expect the introduction of new products toproduce modest growth in 2004 and beyond.Margin pressure, above all in the US and Asian markets,is likely to increase because of the weak dollar. Accord-ingly, all measures to strengthen the competitive positionand cut costs will be systematically pursued in an effortto improve the operating result. Qualitative, profitableand sustainable growth is still the priority.

Sheet Metal Processing Systems

358 36

9

27.4

32.9

10.2

812

1148

111037

8

Management and main units (status at April 1, 2004)Ferdi Töngi, HeadChristian Zürcher, FinanceJürg Sutter, PersonnelJean-Pierre Neuhaus, Corporate CommunicationsJohann Ifanger, Europe South/WestChristoph Schüpbach, Europe North/EastUlrich Trösch, AmericaFlorian Stoffel, Asia/PacificUrs Singer, Laser cuttingPaul Ganzeboom, BendingMichael Merkle, Water-Jet cutting

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The Glass Processing Systems business unit (Bystronicglass), encompassing Bystronic Maschinen AG, LenhardtMaschinenbau GmbH and Armatec Vierhaus GmbH,offers solutions for the manufacture of architectural andautomotive glass.

Continuing investment restraint in glass industry Despite the persistently difficult economic situation,Bystronic glass improved on its 2002 performance withan acquisition-related rise in revenues to CHF 158 million.In the architectural glass division, sales increased, but inautomotive glass they fell. Overall, the order book formachinery and systems was down 14% at the end of 2003.New orders in the automotive glass division showed aclear improvement compared with the previous year.This was driven mainly by an investment boom in China;in other regions, particularly in the USA, glass manufac-turers continued to use existing systems and were most-ly reluctant to invest in new machinery. In architecturalglass, the inflow of new orders was below expectations,particularly in our main markets in Europe and the USA.The subdued investment activity in the sector also led tostrong pressure on margins.The operating result was sharply down compared withthe previous year because of the tougher competitivesituation. A number of measures to reduce costs andraise efficiency only partly offset the margin pressure.The integration of Armatec Vierhaus GmbH in Gunzen-hausen, Germany, acquired at the beginning of 2003,progressed well.The company specializes in the manu-facture of laminated safety glass and glass handlingsystems.The joint sales organization for architecturalglass scored its first successes.The groundwork was alsolaid for joint product developments.

Innovative solutions and investments in attractive marketsWithin the framework of the existing investment strategy,product development expenditure increased comparedwith 2002.This enabled Bystronic glass to launch prod-ucts with high utility value onto the market in rapid suc-cession and thus strengthen the market position.In autumn 2003, Bystronic glass, together with two indus-trial partners, presented a ground-breaking concept – aworld first – in the USA, in the form of a simplified systemfor window manufacture, which was very well receivedby the market.This is a new market for Bystronic glassand promises to provide significant impetus for futuregrowth in the US market.In the architectural glass division, the new glass-cuttingmachine from the “smart” series, which offers an out-standing price-performance ratio, was successfullylaunched onto the market. At Vitrum in Milan, the mostimportant glass industry fair held in the reporting year,Bystronic glass showed a complete line of “smart”prod-ucts for the manufacture of insulating glass, highlightingthe expertise in integrated solutions of the three techno-logy companies Bystronic, Lenhardt and Armatec.Therewas a world première for the prototype of a verticallyoperating float glass-cutting system, which will save cus-tomers space and offer them a greatly simplified produc-tion process.The mostly enthusiastic reception from cus-tomers underlined the considerable market interest inthis concept.The vertical glass-cutting machine is due togo on sale in mid-2004.The sales and service organization was further extendedto provide “one-stop”purchasing and servicing of allproducts in existing and new markets. For example, anew company was established in Brazil to give existingcustomers optimal support and enable the business unitto serve the South American market in a more targetedand intensive way.

From left: Florian Stoffel, Daniel Mathys, Ulrich Trösch, Ulrich Vierhaus,

Rolf Honegger, Steve Powell and Martin Heim.

EXPERTISE IN INTEGRATEDSOLUTIONSGLASS PROCESSING SYSTEMS

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OutlookThe challenge in the current year is to introduce newproducts successfully to the European and North Ameri-can markets, thereby generating sustainable newgrowth.In 2004 the European market is expected to recover,which will positively impact revenues at Bystronic glass.However, given the persistent weakness of the US dollar,a slight decrease in sales is expected in the USA andother dollar markets.

Management and main units (status at April 1, 2004)Rolf Honegger, Head; Lenhardt Maschinenbau GmbH (a.i.)Daniel Mathys, FinanceUlrich Vierhaus, Armatec Vierhaus GmbH (until March 31, 2004)Bernd Bedner, Armatec Vierhaus GmbH (from April 1, 2004)Martin Heim, Sales Manager, Architectural glassThierry Krebs, Sales Manager, Automotive glassUlrich Trösch, North AmericaFlorian Stoffel, Asia/PacificSteve Powell, Great Britain and IrelandFrank Jacobi, South America

Glass ProcessingSystem


01 02 03


01 02 03

7.0

3.6

2.1


01 02 03

559

574 61

8

164

151 15

8

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The Foam Materials, Sporting Goods and CoatingMaterials business units together contributedaround 37% of Group revenue.Sales growth in 2003 was achieved largelythrough acquisitions, which fitted perfectly withthe existing product offering. Signs of stag-nation were seen in the consumer goods indus-try during the reporting year.The goal of the three business units is to estab-lish a leading position in their respective mar-kets through specialized products based on highquality and detailed knowledge of customerrequirements and application technology. Onlythe architectural paints division of the CoatingMaterials business unit operates almost exclu-sively in Switzerland.The other divisions exporttheir products worldwide and maintain a pres-ence in key markets through marketing com-panies and manufacturing plants.

CONSUMER AND INDUSTRIAL PRODUCTS

Soundproofed engine compartments increase the comfort of vehicleoccupants. In the new BMW 5 series, the engine compartment is insulatedwith “Regidur” from FoamPartner.

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The Foam Materials Group, which operates under theumbrella brand of FoamPartner and comprises FritzNauer AG (Switzerland), Neutex AG (Switzerland), Bütti-kofer AG (Switzerland), Reisgies Schaumstoffe GmbH(Germany), Frina Mousse France S.à r.l. (France) andSwisstex Inc. (USA), maintained its strong market positionin high-quality special foams and associated foamproducts in a highly competitive market environment.Consolidated revenues rose, partly due to an acquisition,by 6% to CHF 127 million.The Foam Materials businessunit largely maintained its good earnings position, al-though high raw material prices adversely affected theresult, especially in the first semester.

Substantial growth in automotive businessDespite the slowdown in the automotive industry, theautomotive division generated sales growth of morethan 20% compared with the previous year. A key contri-bution came from the Regidur product line, used forsoundproofing engine compartments. In 2003 theRegidur products, specified by two major German carmanufacturers the previous year, achieved sales growththat exceeded all expectations.The polishing pads and sealing foams application seg-ments recorded double-digit growth, while the produc-tion of headliners was slightly down. It was particularlypleasing that the vigorous growth in the automotivesegment was generated largely with newly developedproducts in new models, which means that the growthtrend is set to continue in the years ahead.

Industry division enjoys brisk demand in the Americas and the Far East In the industry division, the past year brought conflictingtrends in the individual market segments.The importantSwiss domestic market suffered from sluggish demandparticularly in the second half of the year; but in otherEuropean core markets such as Germany and France too,there was little impetus for growth. New projects intro-duced in recent years (e.g. ink carriers, ceramic filters,applicators and sponge foams) made good progress, sig-nificantly expanded their share of the overall businessand will contribute to sales growth in the current busi-ness year.These new developments above all provided a platformfor targeted expansion of the business in the Americas(e.g. Brazil) and the Far East (Korea and China).In January 2004, the activities of the previously autono-mous cleaning division were integrated into the industrydivision.This will generate synergies in the product range

and in marketing.The Frina Mousse France S.à r.l. produc-tion site, which previously concentrated mainly on fin-ished cleaning products, will in future extend its range to include the manufacture of industrial specialties andsemi-finished products, above all in the acoustics seg-ment, and intensify its targeted marketing activities in theFrench market.

Transport packaging as new growth areaIn the reporting year, the packaging business of FritzNauer AG (Switzerland) and – following its acquisitionwith effect from January 1, 2003 – Büttikofer AG (Switzer-land) recorded pleasing sales growth, despite the overallmarket weakness, significant drivers of that growth beingproducts manufactured using the new technologies(milling robots, water-jet cutters). For the first time, Foam-Partner packaging specialties were marketed abroad.The first important contacts in the German market, madeat the Packtec trade show in Nuremberg, have since pro-duced the first sales and led to significant customer rela-tions.Marketing in the packaging division was brought underthe lead management of Büttikofer AG with effect fromJanuary 1, 2004. As a result of this step, the product offer-ing will be further streamlined and focused on customerrequirements.

Comfort and health: light and shadeIn the comfort division, polyurethane foam mattresscores and natural latex mattress cores followed starklycontrasting trends in terms of sales volume and turnover.The polyurethane-dominated Swiss market suffered amarked slump of over 10%, owing to consumer restraint.In view of the high market share, this was a sharp blownot only to Swiss mattress manufacturers, but also to FritzNauer AG as the foremost supplier of the mattress cores.By contrast, the business with natural latex mattresscores, which is focused primarily on European markets,

From left: Egbert Dahmen, Michael Krause, Hans-Ulrich Aerni, Andreas Straub,

Heinz Güttinger, Gerd Heimen, Reinhold Näscher and Heinz Dürrenberger.

STRONG MARKET POSITION HELDFOAM MATERIALS

21

enjoyed extremely dynamic growth. In this segment,expansion of the relevant production capacity is beingdriven forward with all speed.The comfort division unveiled two industry firsts at theInterzum trade show in Cologne.The natural latex coreASN-100, with vertical ventilation, seen for the first timehere, aroused considerable interest among stand visitors;as did the newly developed Evopore comfort foam line,which has since been developed as part of the productrange in targeted applications.In the health division, the “Integra med”special mat-tresses and pillows for the prevention of bedsores alsocontinued to enjoy brisk demand, particularly in Far East-ern markets.The product range was extended andupgraded to harness further growth potential in othermarket regions.

OutlookInvestments in warehousing and logistics at the twofoam production centers in Leverkusen and Wolfhausen,and targeted expansion of the foam production andreticulation facilities for the manufacture of filters at theWolfhausen site, have created a platform for profitablesales growth. But there are other essential factors in theequation: market demand, particularly in Europe, andcurrency trends in the dollar area, which are prominentinfluences on the growth of exports to the Americas andthe Far East.

Management and main units (status at April 1, 2004)Heinz Dürrenberger, HeadHeinz Güttinger, Finance and AdministrationEgbert Dahmen, AutomotiveMichael Krause, Industry & PackagingAndreas Straub, Comfort & HealthGerd Heimen, ProductionReinhold Näscher, DevelopmentHans-Ulrich Aerni, Frina Mousse France S. à r. l., FranceHarry J. Steele, Swisstex Inc., USA

Foam Materials Revenue(in CHF million)

01 02 03

120 12

7

Capital investments(in CHF million)

01 02 03

12.6

11.9

13.5


01 02 03

377 40

0

447

114

22

The Sporting Goods business unit succeeded in increas-ing revenues to CHF 114 million, 8% up on the previousyear, partly thanks to the acquisition of the Raichle brand.In 2003, prices and volumes stagnated or even turneddown in key outdoor markets such as Germany and theUSA. In such an operating environment, only brands with a clear focus – e.g. on technical quality and function-ality – or a very aggressive pricing policy can succeed.

Three top brands in the outdoor businessThe Swiss brands Mammut and Raichle, which specializein mountain and outdoor sports, and the Toko wintersports brand realized the first synergies of their collabora-tion in the areas of sales and delivery services and prod-uct innovation.The planned combination of the distribution and mar-keting structures of the three brands was completed.Thecenters of competence for product development andproduction remain at the existing locations in Altstätten(Toko) and Frauenfeld (Raichle); distribution, logistics andadministration are located at the Mammut center in Seon.These measures, the economies of scale in purchasing as well as further relocation of production to the Far Easthelped to bring about an improvement in the grossprofit margin.The Sporting Goods business unit now markets its prod-ucts under the name “Mammut Sports Group”and com-bines the individual strengths of the three popularbrands with the strength of a jointly run distribution andlogistics structure.It is vital for the future to harness the resulting synergies,given the ongoing concentration process and the strongincrease in pricing pressure in the modestly growingoutdoor market.

Market shares increasedAll three brands maintained and in some cases increasedtheir market share in the core applications of clothing,footwear, sleeping bags, rucksacks, hardware, ski waxesand care products.The Mammut brand generated its strongest growth inthe Austrian, US, French and Italian markets, while Raichlemade significant progress in the German-speaking mar-

kets of Switzerland, Germany and Austria as well as inGreat Britain and the USA.The Toko brand added productlines for cross-country ski poles and gloves to its existingoffering of ski waxes, ski maintenance equipment andtextile treatment products.This more attacking strategyby the Toko brand should bring additional growth insales and earnings over the coming years, particularly inScandinavia and North America.

Innovative product launchesAt the OutDoor trade show in Friedrichshafen, Mammutwas the only brand worldwide to present “softshells”withrevolutionary NanoSphere technology from Schoeller.Applied to textiles and clothing, this technology allowswater and dirt, even oily and greasy substances, to run offeasily and quickly. Another highlight was Mammut’s pres-entation of its “Revelation” rope, which has a diameter of9.2 millimeters, making it the world’s lightest single rope.At the ISPO spring fair in Munich,Toko presented HelX,a new nanotechnology-based liquid wax, which has beensuccessfully tested in competition. And with the revolu-tionary “232 System”grip for cross-country poles andcarbon poles for professional cross-country ski racers,Toko is now well established as an innovative brand inthe cross-country skiing world.Raichle undertook an intensive review of its productrange in the reporting year. A notable result was the deci-sion to focus more on high-alpine products in order tocollaborate with Mammut in developing new lines,above all for professional mountaineers. As a result of thereview, the whole range of trekking, hiking and multi-purpose footwear was further upgraded.

SYNERGIES BEGIN TO KICK INSPORTING GOODS

From left: Marco Müller, Markus Jaeggi, Rolf G. Schmid, Josef Lingg,

Stefan Merkt and Bernhard Bolliger.




23

Sporting Goods

01 02 03 01 02 03

2.4

2.9 3.

1

01 02 03

241

225

250

109

106 11

4

Management and main units (status at April 1, 2004)Rolf G. Schmid, Head;Toko Brand Management (a.i.)Marco Müller, Finance and AdministrationWilly Beyeler, Mammut Brand ManagementStefan Merkt, Raichle Brand ManagementBernhard Bolliger, SalesMarkus Jaeggi, LogisticsJosef Lingg, Production and Business DevelopmentErnst Maria Schweble, Mammut Sports Group GmbH,GermanyBill Supple, Climb High Inc., USAJon Dag Grimsen, Ajungilak AS, Norway

Continual building of brand awareness and imageMammut once more performed brilliantly in the “Gear of the Year” reader poll run by the German magazine“Outdoor.”Mammut came away with a clutch of prizes:two firsts and two third places in the product categoriesand five first places in the image categories.The newadvertising campaign also won several prizes. A newbrand design was created for Raichle, with the launch setfor spring 2004.The goal is to position Raichle, under thename “Raichle of Switzerland,”as a Swiss quality brandand a modern alpine sports brand.Toko is tapping into synergies between its Toko Care lineof modern care products for special textiles and leather,introduced two years ago, and the Mammut textile andRaichle footwear brands.

OutlookAlready in 2003, the combination of the three Swissbrands, Mammut,Toko and Raichle, complemented bythe Ajungilak branded products, under the aegis ofMammut Sports Group, brought results in the form of anattractive range of products and services for sportsgoods retailers.The offering will be further enhanced andrefined as part of the drive to develop new geographicmarkets such as Scandinavia, Britain, the USA and the FarEast.2004 will be a year of consolidation, with the aim ofstrengthening the organization and operational process-es as well as reducing complexity.

24

Despite the slight fall in revenues to CHF 102 million, theoperating result of the Coating Materials business unitwas substantially higher than in the previous year.Thereporting year saw the definitive separation of the threedivisions: architectural paints, plasters and façade insula-tion systems (SWISS LACK Group); print finishing (SchmidRhyner AG); and noise control (Siegfried Keller AG).Theconsolidation of the new management structurebrought the desired simplification.

Architectural paints: improved results despite cyclical downturnAt SWISS LACK Group, revenues after adjustments weredown by 3% in 2003; this is on a par with the cyclicaldecrease in market volume. In spite of this, SWISS LACK AGand its subsidiaries substantially improved their result,but it still fails to meet our expectations.The market position was strengthened in all areas ofSwitzerland thanks to the systematic regionalization ofsales activities.The harmonization of the pricing systemsand offerings of the production companies transferredto SWISS LACK AG went off smoothly and was greetedwith a high level of acceptance, internally as well as bycustomers.The closing of the sales outlet in Zurich-Schwamendingen made it possible to improve efficien-cy at the Wallisellen sales outlet and eliminate overlapsin the Zurich city sales area.A chief concern was to ensure efficient supplies to ourcustomers from the central storage facility in Wallisellen.The accuracy of order details and delivery performancewas increased by use of the EAN code.Thanks to perfectplanning and a committed effort on the productionlines, the products in the required shades were deliveredon time and in some cases much more quickly than thecompetition. Updating and standardization of the paintand plaster formulations continued in 2003.This broughta simplification of raw material warehousing and betterpurchasing conditions.In 2003, competitor companies again responded to thefalling market volume with more intensive marketingactivities and very aggressive pricing. By virtue of expertsales advice, innovative customer training and reliable

management instruments, SWISS LACK was able toabsorb certain price reductions. In Switzerland, there isstill surplus capacity in production and in the market for architectural paints and plasters. Further price andmargin erosion can be expected in the current year.Every effort will be made to counter this trend by system-atic regionalization of sales, strict management of theproduct range and innovative sales and customer train-ing. Closeness to customers and responsiveness to theirrequirements continue to be the focus in 2004.

Print finishing: setback due to worldwide crisis in the printing industrySchmid Rhyner AG failed to match its good 2002 perfor-mance owing to the difficult situation facing the printingindustry worldwide. Sales were down 3%, while earningsshowed a corresponding decline. In Germany, sales fell by almost 6% as a result of the decrease in the marketvolume and the ruinous price war. Plans for entry into theUS market had to be redrawn. Since May 2003, marketingof Schmid Rhyner products is in the hands of Philadelphia-based WRH Marketing Americas, a company of WalterReist Holding.In addition, all internal processes were reviewed andoptimized.The cost structure of UV varnish formulationswas optimized; the water-based overprint varnishes weresimplified.The use of new, more effective additivesallowed a further reduction in product prices.The report-ing year also saw the launch of some promising innova-tive projects which will help to secure the medium- andlong-term future of Schmid Rhyner AG.

From left: Martin Renggli, Martin Holenweg, Markus Keller and Andreas Singer.

PROCESS IMPROVEMENTS TO RAISE PRODUCTIVITYCOATING MATERIALS




01 02 03 01 02 03 01 02 03

25

Noise control: cyclical and system-related downturnSales at Siegfried Keller AG were slightly down on theprevious year. Apart from the low level of business activ-ity in the machinery and automotive industries, theincreased trend towards active noise protection con-tributed to this fall: machinery and vehicles are beingbuilt to minimum-noise specifications, rather than relyingon passive soundproofing – which is, however, the corecompetence of Siegfried Keller AG. A response to thistrend must be found through innovation. In the construc-tion industry, drastic economies affected mainly the topsegment, while lower-end products enjoyed an upturn indemand.

OutlookIn the current year, the SWISS LACK Group will do every-thing in its power to further strengthen its market posi-tion and bring costs down. As a result, an improved per-formance is expected despite the stagnating market.In the print finishing division, the first priority is to settlethe question of succession in the top management andto battle against the recessionary trend in the marketswith innovative products and projects.The noise control division has to innovate in order toovercome its vulnerability to the trend from passive noiseprotection to active noise reduction.

Management and main units (status at April 1, 2004)Martin Holenweg, HeadMartin Renggli, Finance and Administration

SWISS LACK Group – Architectural paintsMartin Holenweg, HeadMarcel Röthlisberger, MarketingChristoph Studer, SalesRolf Vogt, Purchasing

Schmid Rhyner AG – Print finishingAndreas Singer, Head (until March 31, 2004)Martin Holenweg, Head, a.i. (from April 1, 2004)

Siegfried Keller AG – Noise controlMarkus Keller, Head

Coating Materials

104

102

5.2

9.2

1.5

281 30

7

266

109

27

The revenues generated by the Real Estate busi-ness unit and the industrial companies RobertSeckler AG and PREBETON SA account for 6% of consolidated Group revenue.The divestmentof Hard AG in November 2002 had a correspon-ding impact on the 2003 sales figures.Plazza Immobilien, which focuses on theGroup’s real estate activities in Switzerland, is atraditional cornerstone of the Conzzeta Groupand a reliable source of steady revenues.Robert Seckler AG is engaged in a specializedarea of production automation: the supplychain to and from machine tools and the han-dling of high-precision parts with short cycletimes.Typical areas of application for thistechnology are in the automotive industry, forexample grinding of fuel injectors.PREBETON SA has a rich fund of experience andtechnical expertise in concrete prefabrication,including prefab garages and noise barriers, aswell as a broad spectrum of complex construc-tion components.

REAL ESTATE AND OTHER INDUSTRIAL ACTIVITIES

Window – one of the key components of our living space.The glass is first cut on Bystronic systems, then turned into insulatingwindow panes by machines from Lenhardt.




28

Real Estate

20

21

3.8

5.3

1.6

8

9

6

19

The team from Plazza Immobilien (from left): Frieda Vetter, Marcel Stieger,

Edith Meuter, Ralph Siegle, Bettina Gübeli and Peter Kunkler.

REAL ESTATE

The tense situation in the residential property marketdeteriorated further in 2003, particularly in the Zurichconurbation. Although there was a modest increase innew construction activity in the apartment housesegment, the current availability of apartments for rentonly partly satisfied demand: a large proportion of theapartments being built are being put on the market asowner-occupied property. In 2003, Plazza Immobilien wasagain able to maintain full letting of its properties.In the office and commercial property market, the imbal-ance of supply and demand was further aggravated.Given the broader economic picture, the glut of officespace on the market is unlikely to subside in 2004.Increasing pressure on rental levels is the logical conse-quence.

Plazza Immobilien’s real estate projectsMarketing of the available lettings at the projected officebuilding Tethys-Park in Wallisellen, with around 12000m2

office space, has been underway since 2003 – so far with-out success. At the time of writing, no tenant or buyer hasbeen found because of the above-mentioned surplus.There was also a slight fall in demand for single-familyhouses.The sale of building plots in Rafz is not yet pro-gressing according to expectations. A feasibility and us-age study was conducted for the industrial site acquiredat Estavayer-le-Lac. In the current year, the definitive long-term strategy for this project will be determined. At anumber of properties, land register surveys in conjunc-tion with the remediation of residual pollution will con-tinue in 2004.Various land sales in Zurich, St. Gallen and western Switzer-land rounded off what was nevertheless a successful yearfor Plazza Immobilien.

OutlookReal estate investments in promising projects will con-tinue to yield good returns in the future. However, no re-duction in the oversupply of office space can be expect-ed in 2004.There is even a likelihood that the situationwill deteriorate further at less attractive locations. But thestrong demand for apartments, particularly in the Zurichconurbation, will be sustained.

Management and main units (status at April 1, 2004)Ralph Siegle, Plazza Immobilien

01 02 03 01 02 03 01 02 03




01 02 03 01 02 03 01 02 03

29

Robert Seckler AGThe fall-off in investment in machine construction andthe postponement of major projects in the automotiveindustry adversely affected the 2003 result of RobertSeckler AG, which specializes in the manufacture of pro-duction automation systems. Measures taken at the be-ginning of the year, including the introduction of short-time working, were not sufficient to improve the earn-ings situation. In September, 16 jobs had to be cut.No significant improvement is expected in the first fewmonths of 2004. Despite the prevailing climate, the com-pany acted to safeguard competitiveness by committingmajor investments in marketing and product develop-ments.“Modulo”, the new modular product line first unveiled in2002, was upgraded.The new version is even more com-pact and offers customers greater flexibility thanks to“plug & go”technology. Image processing systems wereused in response to the trend towards intelligent auto-mation. In future, hybrid automation, i.e. solutions combin-ing man and machine, will play an important role. RobertSeckler AG already offers mini-robot systems that operatehand-in-hand with human technicians.These innovativesystems were first presented on the company’s own standat EMO, the international machine tool trade show,in Milan, and met with great interest. Competition – andwith it the pressure on delivery times and pricing – wasespecially intense in 2003.The company managed tomeet the extremely short delivery deadlines thanks to themeasures taken to reduce throughput times and the newIT system. Further cost optimization was achieved bysystematic standardization of machinery and processes.The increased inflow of new orders in the last two

OTHER INDUSTRIAL ACTIVITIES

Other IndustrialActivities

52

26

6.0

1.8

235

168

141

80

months of 2003 must be seen as the first timid signs of recovery, rather than the start of an actual upswing.Robert Seckler AG has built a good reputation in themarket through its innovative, high-quality products.This is a good springboard from which to take advantageof the anticipated upturn when it comes.

PREBETON SAThe first few months of the reporting year were verytough for PREBETON SA, which specializes in concretesystem building. Delays in planning applications for on-going orders and the postponement of various projectsat short notice resulted in below-average capacity load-ing in the first quarter of the year. But a turnaround in thesecond half of the year enabled the company to makeup for the slow start and substantially improve on the2002 sales performance.The main contributors to thisupturn were prefabricated garages, special componentsand the modular building systems. Overall, sales growthwas around 16%. Although the operating result im-proved in the reporting year, the earnings situation wasunsatisfactory. Systematic implementation of the definedgoals and a well-filled order book should see a furtherimprovement in the key figures in 2004.

Management and main units (status at April 1, 2004)Robert Seckler AGAndreas Fiechter, HeadJacques Hess, MarketingAndré Chardonnereau, Engineering

PREBETON SAAndreas Streit, Head

0.3

31

The strong diversification of Conzzeta Holdingplaces considerable demands on the Corporatemanagement. Nevertheless the Holding com-pany’s corporate staff – with its units CorporateDevelopment and Group Secretariat, Group Fi-nance and Pension Funds – is a compact andlean organization.This is in keeping with theConzzeta principle of delegating responsibilityto the operational units.Among the Holding company’s responsibilitiesare the fulfillment of the statutory requirementsplaced on a publicly listed company, the layingdown of strategic and financial guiding princi-ples, the coordination of areas of interest withrelevance across the Group organization as wellas internal and external communication.Themembers of the corporate staff further supportthe Group business units in activities such ascompany acquisitions.

DEDICATED TODEVELOPING THE GROUPCORPORATE SERVICES

Marc Sutter, Arnold P. Huber and Fabio Sorgesa.

Revised planning and management toolsThe extension of the business units’ activities throughacquisitions and the entry into new markets made anoverhaul of the management instruments necessary.The result was a new consolidation instrument and themodification of existing planning and managementtools.The Holding company has thereby created a moreeffective platform on which to assess the strategic andfinancial situation of the business units as well as thevalue and development potential of the holding port-folio.The corporate staff is also responsible for conduct-ing internal audits in the areas of finance and informationtechnology. In the IT field, the Holding company hasoverseen Group-wide firewall and intranet projects.In the reporting year, the in-house insurance broker, whoacts also for non-Group companies, built on the coopera-tion with leading international brokerage networks toconclude and renew worldwide non-life and liability in-surance programs, on favorable terms, for all Group com-panies.

Products from SWISS LACK – the group of Conzzeta companies thatspecialize in architectural paints – make external façades and interiorspaces last longer and look better.

The Group-wide initiative to encourage the spirit of inno-vation, first launched in 2002, was pursued in a number ofways, for example through the management conference“Conzzeta Forum”and articles in “Profile,” the in-housemagazine.“Profile”also presented the Conzzeta Group’sprinciples of leadership and conduct and illustratedthem with examples from the business units. In the pub-lic relations field, we continued to offer the popular guid-ed tours of companies for journalists and financial ana-lysts. In the current year, the website and other informa-tion media will be updated.

New pension fund benefitsThe autonomous and organizationally independent pen-sion funds of Conzzeta Holding are operating in a diffi-cult climate for the pensions industry.Turbulence on finan-cial markets and political discussions about the “secondpillar”pension system have increased the informationrequirements of fund participants.The Conzzeta pensionfund has responded to this need by providing regularupdates about the fund’s situation.This includes infor-mation about changes in pension benefits. In the report-ing year, the pension plans were revised and adapted tomeet present-day standards and changing actuarialcircumstances.The 2004 regulations were sent to all poli-cy holders with a summary of the principal changes.

32

CORPORATE GOVERNANCEINFORMATIONS IN ACCORDANCE WITH THE SWX SWISS EXCHANGE DIRECTIVE

Group structureThe Group structure is illustrated on page 7.

Participating interestsThe list of significant participating interests is shown on page 54 et seq.Conzzeta Holding is listed on the SWX Swiss Exchange. Swiss security number 265 798, ISIN CH0002657986

Significant shareholdersAs of December 31, 2003, the following significant shareholders were known to the Company:

The reserves have fallen by CHF 70.2 million as a result of the two capital reductions; a total of CHF 82.2 million wasallocated to reserves from retained earnings.The year-by-year changes in the capital structure are explained in thenotes to the annual financial statement of Conzzeta Holding in the relevant annual reports.

This corporate governance report summarizes all the available information relating to Conzzeta Holding. Any pointsnot applicable to Conzzeta or which correspond to legal norms are not listed.

Equity holding Percentage of nominal capitalTegula AG 81.4% 73.5%

In the reporting year, Conzzeta Holding reduced its treasury shares to below 5%.This was carried out on the basis of the resolution of the Ordinary General Meeting of Shareholders on May 6, 2003, to reduce the share capital from CHF 50 million to CHF 46 million by cancellation of 40 000 treasury bearer shares with a par value of CHF 100 each.

Capital structureBearer shares Registered shares Total nominal capital (par CHF 100) (par CHF 20) (CHF)

Share capital 406 000 270 000 46 000 000

Changes in share capital over the last three yearsShare capital Reserves Retained earnings Total equity

(CHF) (CHF) (CHF) (CHF)

Share capital as of 12/31/2000 54 000 000 224 750 000 97 789 261 376 539 261

Change 2001 10 000 000 –2 812 880 7 187 120


Change 2002 –4 000 000 –32 155 836 33 989 193 –2 166 643


Change 2003 –4 000 000 34 123 938 –61 489 059 –31 365 121


33

Board of DirectorsJacob SchmidheinyLic. oec. publ.Chairman of the Board of Directors, member since 1977.He became a member of the Executive Board of ZürcherZiegeleien in 1976. From 1978 to 2001 he was Presidentand Chief Executive Officer of Zürcher Ziegeleien,today Conzzeta Holding. He is Chairman of the Board ofDirectors of Tegula AG, Zurich, and a member of theBoard of Directors of Flughafen Zürich AG, Zurich Airport.

Christoph SpoerryIng. ceramVice Chairman of the Board of Directors, member since 1981.Up to 1994, he held various management positions atZürcher Ziegeleien. He is a member of the Board ofDirectors of Tegula AG, Zurich.

Matthias AuerDr. iur.Member of the Board of Directors since 1996.He is a lawyer and notary public. He is a member of theCantonal Council in Glarus and the Municipal Council inNetstal. He is also a member of the Board of Directors ofTegula AG, Zurich.

Thomas W. BechtlerDr. iur., LL.M.Member of the Board of Directors since 1987.CEO of Hesta AG, Zug, and Hesta Tex AG, Zug. Chairmanof the Board of Directors of Zellweger Luwa Group, Uster,and of Schiesser Group AG, Küsnacht;Vice President ofthe Board of Directors of Sika AG, Baar; member of theBoard of Directors of Credit Suisse Group, Zurich, of SwissRe, Zurich, of Robert Bosch Internationale BeteiligungenAG, Zurich, and of Bucher Industries, Niederweningen.

Werner DubachDipl. Ing. Chem. ETH, MBAMember of the Board of Directors since 1993.He is Chief Executive Officer and member of the Board of Directors of Eichhof Holding AG, Lucerne.

Robert F. SpoerryDipl. Masch.-Ing. ETH, MBAMember of the Board of Directors since 1996.He is Chairman of the Board of Directors and CEO ofMettler-Toledo International Inc., Greifensee; member ofthe Board of Directors of Schaffner Holding AG, Luter-bach, and Phonak Holding AG, Stäfa.

All members of the Board of Directors are Swiss nationals.

Election and term of officeThe Board of Directors as a whole is elected for a term of three fiscal years; the next election is due to be held atthe Ordinary General Meeting of Shareholders in 2005.

Internal organizationThe Board of Directors acts as an integral body and doesnot appoint special committees.The Chairman super-vises the preparation and implementation of its decisionsby Group management, notably in matters of strategy,financing, personnel appointments and important indi-vidual transactions.The Board of Directors has regularmeetings four times a year and holds additional meet-ings as required.The Chairman of the Group Executive Board, the Chief Financial Officer and the Secretary of the Boardusually take part in Board meetings.The heads of thebusiness units and senior executives from Group compa-nies are invited to take part in Board meetings whenimportant matters relating to their businesses are to bediscussed.

CompetencesThe Group Executive Board and the managements of thebusiness units have far-reaching competences in regardto the strategic and operational organization of the unitsassigned to them. It is their task, through the carefuldevelopment of human, material and organizational re-sources, to deliver competitive performance and robustfinancial results. Decision-making competences aregraded according to their significance and financial mag-nitude.The Board of Directors takes decisions about thefundamental corporate policy and important individualtransactions.

InformationThe Conzzeta Group has a well-developed planning andinformation system. It is built from the base up, becom-ing increasingly concentrated towards the top.The Boardof Directors is oriented verbally and in writing about thestrategies, plans and results of all business units. It isprovided with all important financial data from businessunits and at Group level. For important individual transac-tions a special documentation is produced and present-ed by those responsible at Board meetings.

34

Group Executive BoardHeinrich M. LanzDipl. El.-Ing. ETHChairman of the Group Executive Board since 2002.After serving 15 years in various management posts inindustry, he switched to management consultancy in1991. He acted as consultant to the Conzzeta Group fortwo years.

Heinz DürrenbergerDr. Chem.Head of the Foam Materials business unit since 1993.He held management positions in the chemical industryin Switzerland and abroad. In 1991 he joined the ConzzetaGroup as a director at Fritz Nauer AG.From 1993 to 2003 he was also Head of the SportingGoods business unit.

Martin HolenwegDipl. Bauing. ETH, postgraduate studies BWI ETHHead of the Coating Materials business unit since 2002.He has served in management positions in various com-panies in the construction industry.

Rolf HoneggerEngineer HTL, MBAHead of the Glass Processing Systems business unit since 2002.He was active in leading positions in the high-tech andengineering industry in Switzerland and abroad for over10 years. In 2001 he joined the Conzzeta Group as theCEO of Bystronic Maschinen AG.

Arnold P. HuberDr. rer. pol.Chief Financial Officer since 2003.He served in management functions in the financial and legal domains for publicly listed and internationalcorporations.

Rolf G. SchmidLic. oec. HSGHead of the Sporting Goods business unit since 2004.He held management positions in the pharmaceuticalindustry and also served in the watch and tourist indus-tries. He joined the Conzzeta Group in 1996 as Head ofthe Sports business unit of today’s Mammut SportsGroup AG. He took over as CEO of the company in 2000.

Ralph SiegleFederal diploma in real estate management Head of the Real Estate business unit since 2003.He was a senior executive at several large companiesworking in the field of real estate management.

Fabio SorgesaLic. oec. HSGHead of Corporate Development since 1999 and Secre-tary of the Board since 2000.He was deputy to the Federal Council’s delegate for thecelebrations to mark the 700th anniversary of the SwissConfederation; also worked in the consumer goodsindustry and as a management consultant.

Ferdi TöngiEngineer HTL, MBAHead of the Sheet Metal Processing Systems businessunit since 2002.He has held various management positions in the preci-sion instrument and engineering industry in Switzerlandand abroad. He joined the Conzzeta Group in 2000 asHead of the Machinery and Systems Engineering busi-ness unit.

All members of the Group Executive Board are Swiss nationals.

CompensationThe members of the Board of Directors are entitled toappropriate compensation, determined by the Board ofDirectors, for their efforts and expenses.

The members of the Group Executive Board receive a salary comprising a fixed and a variable part, the latterdepending on the achievement of the agreed opera-tional and financial targets.

Total compensation 1/1 – 12/31/2003Members of the Board of Directors CHF 689 680

Members of the Group Executive Board CHF 2 959 520

Highest compensation received by a member of the Board of Directors CHF 515 680

Share ownershipApart from Tegula AG, there are no significant shareholders.

35

Shareholder’s participation rightsStatutory quora (Article 10 of the Articles of Incorporation) A resolution of the General Meeting of Shareholderswhich carries at least two-thirds of the represented votesand an absolute majority of the par value of the repre-sented votes is required for:

1. changes to the Articles of Incorporation2. changes to the share capital3. the limitation or annulment of subscription rights4. the liquidation of the Company

Agenda (Article 7 of the Articles of Incorporation)Shareholders who represent shares with a par value of atleast CHF 1 million can demand the inclusion of an itemon the agenda.The request must be submitted to theCompany at least 40 days before the General Meeting ofShareholders.

Registrations in the share register (Article 4 of the Articles of Incorporation)From the date of invitation to a General Meeting ofShareholders up to the day after the General Meeting it-self, no registrations will be accepted in the share register.

Duty to make an offer (Article 5 of the Articles of Incorporation)Opting out: Persons acquiring shares in the Company arenot under obligation to make an offer in accordance withthe Stock Exchanges and Securities Trading Act.

AuditorsDuration of the mandate and term of office of the head auditorThe statutory auditors and Group auditors of ConzzetaHolding since 1939 is KPMG Fides Peat in Zurich.The head auditor has held this position since 2003.

FeesIn the reporting year, the auditors responsible for theGroup’s annual financial statements and some of theGroup companies’ annual financial statements submittedaccounts for the following fees:

Auditing fees CHF 380 000

Additional fees CHF 430 000

Supervisory and control instruments vis-à-vis the auditorsThe Chairman represents the Board of Directors vis-à-visthe statutory auditors and the Group auditors. Afterhearing the auditors and the Chief Financial Officer, theChairman determines the audit programs. He discussesthe audit results with the auditors.The Board of Directorsis apprised of the reports which are commented upon by the head auditor at a Board meeting.

Information policyThe Company publishes an annual business report as of December 31 and interim reports as of April 30 andAugust 31.

The consolidated financial statements in accordancewith Swiss GAAP FER give a true and fair view of the ac-tual circumstances.

Further information about the Company, calendar datesand contacts can be found at www.conzzeta.com

Group 3738404142535456

Holding company 5758606162

63

6466

68

Consolidated income statementConsolidated balance sheetConsolidated cash flow statementConsolidated statement of value addedNotes to the consolidated financial statementsEmployee pension funds, SwitzerlandList of major consolidated companies by business unitAuditors’ report

Income statementBalance sheetNotes to the financial statementsAdditional information on the financial statementsProposed appropriation of available earnings by the Board of DirectorsStatutory auditors’ report

Net revenue from 1999 to 2003Five-year summary

Information for investors36

CONTENTSFINANCIAL STATEMENTS

37

CONSOLIDATED INCOME STATEMENT

Revenue

Net revenue (third-party) by business unit:Sheet Metal Processing SystemsGlass Processing SystemsFoam MaterialsSporting GoodsCoating MaterialsReal Estate and miscellaneous revenueOther Industrial Activities

Total net revenue

Changes in inventory and own work capitalized

Total revenue

Expenses

Cost of materialsPersonnel expensesOther operating expensesDepreciation

Operating result

Financial incomeFinancial expensesIncome from unconsolidated participationsExtraordinary profit

Profit before taxes and minority interests

TaxesMinority interests

Group profit

2003in CHF m

369.011 157.500 127.114 114.168 101.713

20.615 26.464

916.585

–13.557

903.028

–440.513 –246.798 –154.989

–44.921

15.807

3.316 –1.566

0.037 12.858

30.452

–7.419 –0.234

22.799

2002in CHF m

358.079 150.581 120.012 105.625 103.746

19.729 51.574

909.346

–1.114

908.232

–446.663 –237.390 –150.095

–39.208

34.876

3.726 –2.756 –0.149 24.886

60.583

–15.216 –0.302

45.065

Notes

3

4

5

6

7

8

9

10

11

12

CONSOLIDATED BALANCE SHEETAT DECEMBER 31

Assets

Current assets

Cash, cash equivalents and securitiesTrade receivablesOther receivablesPrepaid expenses and accrued incomeInventories

Total current assets

Fixed assets

LandResidential buildingsCommercial buildingsFactory buildingsPlant and machineryFixtures and fittings, vehiclesAssets under construction, payments on account

Financial assetsIntangible fixed assets

Total fixed assets

Total assets

38

Notes

13

14

15

16

17

17

17

17

17

17

17

18

18

2002in CHF m

132.627 145.401

23.076 9.026

191.787

501.917

47.437 99.523 30.206

156.359 43.550 21.033

6.239

6.031 17.348

427.726

929.643

2003in CHF m

89.283 172.983

28.503 10.288

185.375

486.432

50.407 97.422 29.106

156.425 49.777 18.441

3.180

12.976 29.413

447.147

933.579

39

Liabilities and shareholders’ equity

Short-term liabilities

Trade payablesAdvance payments from customersFinancial liabilitiesOther short-term liabilitiesAccrued expenses and deferred income

Total short-term liabilities

Long-term liabilities

Other long-term liabilitiesProvisions

Total long-term liabilities

Minority interests

Shareholders’ equity

Share capitalReserves

Total shareholders’ equity

Total liabilities and shareholders’ equity

2002in CHF m

58.295 18.960 13.062 13.823 58.660

162.800

3.715 86.141

89.856

2.085

50.000 624.902

674.902

929.643

Notes

20

23

21

22

24

25

26

27

2003in CHF m

56.191 12.631

0.371 16.786 62.037

148.016

3.306 96.476

99.782

1.978

46.000 637.803

683.803

933.579

CONSOLIDATED CASH FLOW STATEMENT

40

Group profitDepreciationGain on disposal of fixed assetsIncrease in provisionsOperating cash flowChange in receivables, prepaid expenses and accrued incomeChange in inventoriesChange in liabilities, accrued expenses and deferred incomeDecrease in advance payments from customers

Net cash flow from operating activities

Investment in fixed assetsProceeds from sale of fixed assetsAcquisition and divestment of business activities

Net cash flow from investing activities and sale of fixed assets

Free cash flow

Dividend paidSale/repurchase of treasury sharesDecrease in short-term financial liabilitiesRepayment of bondsChange in other long-term liabilitiesIncrease in shares held by minority shareholders

Net cash flow from financing activities

Effect of currency translation

Movements in cash, cash equivalents and securities

Cash, cash equivalents and securities at 1/1Cash, cash equivalents and securities at 12/31

2003in CHF m

22.799 44.922

–13.149 1.436

56.008–39.220

12.236 6.945

–7.976

27.993

–39.918 17.177

–18.827

–41.568

–13.575

–11.455 0.669

–13.693

–0.409 0.079

–24.809

–4.960

–43.344

132.62789.283

2002in CHF m

45.065 39.207

–21.677 0.520

63.11520.267 –3.119 –9.061 –2.030

69.172

–70.978 14.505 14.358

–42.115

27.057

–18.865 –46.156

–9.961 –35.000

0.259 0.040

–109.683

–7.426

–90.052

222.679 132.627

Notes

31

CONSOLIDATED STATEMENT OF VALUE ADDED

41

Sources of value added

Total revenueFinancial incomePurchase of materials and services

Gross value added

Depreciation

Net value added

Distribution of net value added

PersonnelGovernmentLendersInvestorsMinority shareholdersGroup

Net value added

Average number of employees Number

Total revenue per employee in CHF thousand

Net value added per employee in CHF thousand

Personnel costs per employee in CHF thousand

2003in CHF m

903.028 3.353

–594.620

311.761

–44.921

266.840

246.798 8.301 1.566 9.180 0.234 0.761

266.840

2 874

314.206 92.846 85.873

in %

92.53.10.63.40.10.3

100.0

2002in CHF m

908.232 3.577

–595.787

316.022

–39.208

276.814

237.390 16.187

2.756 11.455

0.302 8.724

276.814

2 694

337.131 102.752

88.118

in %

85.85.81.04.10.13.2

100.0

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

General principles

The consolidated financial state-ments have been prepared on thebasis of the audited financial state-ments of the Group companies at December 31, using accountingpolicies which are consistentthroughout the Group and in accor-dance with Swiss GAAP FER.

Consolidation principles

Scope and method of consolidationThe consolidated financial state-ments include the financial state-ments of Conzzeta Holding and ofthe participating interests (Groupcompanies) in which ConzzetaHolding, directly or indirectly, ownsat least 50% of the capital and ofthe voting rights.Participating interests of more than50% are fully consolidated.Theshare of the minority shareholdersin the net assets and net profit isdisclosed separately. Participatinginterests of 50% are consolidatedon a pro rata basis.Intergroup receivables and pay-ables as well as expenses and in-come are offset against each other.Moreover, intergroup profits havebeen eliminated.The assets and liabilities of compa-nies included in the consolidationfor the first time are valued anddisclosed in accordance with Groupaccounting policies. Goodwill aris-ing from this revaluation is capital-ized and amortized to the incomestatement.

Participating interests of between20% and 50% that are material tothe Group are accounted for underthe equity method. Other minorityparticipations are valued at acquisi-tion cost, less any necessary provi-sions for diminution in value.A list of major consolidated compa-nies can be found on pages 54 etseq.

Foreign currency translationBalance sheets in foreign currenciesare translated to Swiss francs usingthe year-end exchange rates, andincome statements have beentranslated at the average rates forthe year.The resulting translationdifferences are taken directly to re-serves. All gains and losses resultingfrom transactions in foreign curren-cies are recognized in the incomestatement.

Valuation policies

Cash, cash equivalents and securitiesCash and cash equivalents includecash on hand, postal checking andbank account balances, and timedeposits.The securities are market-able, readily realizable investments.They are shown at market value.

ReceivablesTrade receivables and other receiv-ables are shown at invoicedamounts, less appropriate provisionsfor debtors’ risks. Specific provisionsfor bad debts are accounted forwhere required and deferred creditrisks are also considered.

InventoriesInventories are shown at the lowerof acquisition or production costand market value. Production cost iscalculated without imputed interest.Provisions are made for obsolescentand slow-moving inventories.

42

Property, plant and equipmentLand has been valued at acquisitioncost less impairment adjustments.Other tangible fixed assets are val-ued at acquisition or productioncost less accumulated depreciation.Depreciation is calculated using thestraight-line method over the esti-mated useful life of the asset.

Estimated useful lives are as follows:Residential buildings 60 yearsCommercial and factory buildings 30 to 50 yearsPlant and machinery 3 to 20 yearsFixtures and fittings,vehicles 3 to 10 years

Financial assetsFinancial assets are valued at acqui-sition cost, less provisions for spe-cific debtors’ risks.

Intangible fixed assetsIntangible fixed assets includegoodwill arising from the acquisi-tion of business activities as well asformulas, licenses, trademarks andsoftware costs.Goodwill and other intangibleassets are amortized to the incomestatement over their estimateduseful life using the straight-linemethod.

Impairment of assetsThe value of assets is assessed atregular intervals.Where there aresigns of long-term loss of value, anassessment of the realizable value ismade. If the book value exceeds the realizable value, an additionaldepreciation adjustment is made.

Shareholders’ equityTreasury shares are set off againstthe shareholders’ equity.

Deferred taxesDeferred income tax is provided forall temporary differences arisingbetween the tax bases of assetsand liabilities and their carryingvalue for reporting purposes usingthe currently enacted tax rates onan entity level. Movements in thedeferred tax provision are includedin the tax charge in the incomestatement.

Employee pensionsThe pension obligations of Groupcompanies in respect of retirement,death and disability benefits arebased on local rules and customs ineach country. Regular contributionsare paid to government bodies,autonomous pension funds or insu-rance companies. In some cases,specific provisions are made.Thepension and benefit paymentsmade during the accounting periodand the regular contributions to thevarious pension funds are chargedto the income statement.All private pension plans are de-fined contribution schemes. Actua-rial reviews are undertaken regu-larly.The consolidated statement forthe autonomous pension funds inSwitzerland is shown on page 53.

Research and developmentResearch and development costsare fully charged to the incomestatement.

Derivative financial instrumentsForward exchange contracts andoptions are used to hedge againstcurrency risks arising from businessoperations.These are measured atmarket value.

43

Additional information on the consolidated financial statements

1. Changes in the scope of consolidation

Purchase of participating interests and business activities:The acquired companies Armatec Vierhaus GmbH, Gunzenhausen (Germany),and Büttikofer AG, Gontenschwil (Switzerland), have been consolidatedsince 1/1/2003.The business activities of “Raichle Outdoor Footwear”were acquired witheffect from 4/1/2003.

Mergers:Toko GmbH, Bregenz (Austria), was merged with a third-party private com-pany and renamed Mammut Sports Group Austria GmbH, Steyr (Austria).A 25.1% stake was retained by way of compensation and Toko GmbH,Bregenz, was deconsolidated on 1/1/2003.Bystronic Italia S.r.l., Bovisio Masciago (Italy), acquired the assets and liabili-ties of Beyeler Italia S.r.l., San Lazzaro di Savena (Italy), on 7/23/2003.

Liquidations:The inactive companies Ajungilak Produksjon AS, Oslo (Norway) undAjungilak Sverige AB, Malmö (Sweden), were deconsolidated with effectfrom 1/1/2003 following winding up.

The present structure of the Group companies is shown on page 54 et seq.

44

2. Currency translation rates

Balance sheet Income statement

2003 2002 2003 2002CHF CHF CHF CHF

1 EUR 1.56 1.45 1.52 1.471 USD 1.24 1.39 1.35 1.561 GBP 2.21 2.23 2.20 2.34100 SEK (Sweden) 17.20 15.85 16.67 16.02100 NOK (Norway) 18.57 19.95 19.02 19.551 SGD (Singapore) 0.73 0.80 0.77 0.87100 KRW (Korea) 0.10 0.12 0.11 0.13100 CNY (China) 15.02 16.78 16.27 18.83100 MXP (Mexico) 11.05 13.34 12.50 16.21

45

Net revenue by geographical area:

SwitzerlandGermanyRest of Europe

Total Europe

AmericaOther continents

Total

4. Changes in inventory andown work capitalized

Change in inventoryOwn work capitalized

Total

2002in CHF m

–1.20.1

–1.1

2002in CHF m

244.8118.9337.6

701.3

120.687.4

909.3

in %

26.913.137.1

77.1

13.39.6

100.0

in %

24.714.537.6

76.8

11.212.0

100.0

2003in CHF m

226.2133.1344.1

703.4

103.1110.1

916.6

2003in CHF m

–13.70.1

–13.6

Consolidated income statement

3. Net revenue in CHF m in %

Net revenue 2002 909.3 100.0

Changes in Group revenue 2003 due to:– foreign exchange differences –11.8 –1.3– acquisitions and divestments 13.0 1.4– changes in quantity and price 6.1 0.7

Total change 7.3 0.8

Net revenue 2003 916.6

The changes in inventory occurred primarily at the manufacturingcompanies.

46

5. Cost of materialsCost of materials comprises the cost of raw materials and supplies, as wellas merchandise held for resale. Expenditure on raw material and Compo-nents manufactured by third parties was CHF 349.5 million (previous year:CHF 362.6 million). Merchandise accounted for CHF 91.0 million (previousyear: CHF 84.0 million).

6. Personnel expensesPersonnel expenses include, in addition to wages and salaries payable toemployees and other personnel expenses, social insurance contributionsas well as provisions for statutory and voluntary social security benefitsmade by Group companies amounting to CHF 35.0 million (previous year:CHF 33.9 million). In addition, CHF 2.0 million net (previous year:CHF 1.0 million) was paid from the employer contribution reserves of theemployee pension funds.

7. Other operating expensesOther operating expenses include the cost of repairs and maintenance, aswell as energy, selling, administration and sundry expenses.

2003 20028. Depreciation in CHF m in CHF m

Breakdown of depreciation:– on property, plant and equipment 32.1 30.5– on financial assets and

intangible fixed assets 12.9 8.7

Total 45.0 39.2

47

9. Financial incomeFinancial income includes income from investments, which fell as a resultof decreasing cash, cash equivalents and securities as well as falling interestrates, and also realized currency gains.

10. Financial expensesFinancial expenses include interest of foreign Group companies.

11. Extraordinary profitThe extraordinary profit of CHF 12.9 million comprises gains on the sale of real estate in the cities of Zurich,Wittenbach (St. Gallen) and Jouxtens-Mézery (Vaud).The direct taxes and transaction costs are deducted.

2003 200212. Taxes in CHF m in CHF m

Current taxes on incomeand capital 10.1 15.7Deferred income taxes –2.7 –0.5

Total 7.4 15.2

Deferred taxes of CHF 0.4 million have been capitalized for easily realizabletax losses carried forward.

48

Consolidated balance sheet

13. Cash, cash equivalentsand securities

Cash on hand, postal checking and bank account balancesSecurities

Total

Cash and cash equivalents fall due within one year.The securities aremainly fixed-interest bonds denominated in CHF and EUR.

14. Trade receivables

Trade receivablesGeneral provision for debtors’ risks

Total

Doubtful accounts are provided for based on an individual assessment.The increase is mainly due to the strong sales generated in the finalmonths of the reporting year.

15. Other accounts receivableOther accounts receivable include tax credits, payments on account tosuppliers and soundry receivables.

16. Inventories

Raw materials and suppliesMerchandise for resaleUnfinished products and work-in-progress Finished products

Total

The increase in the inventory of raw materials and supplies as well asunfinished products and work-in-progress is due mainly to the Sheet Metal Processing Systems business unit.The finished products inventoryincreased mainly in the Sheet Metal Processing Systems business unit.Merchandise for resale decreased in all business units except the SportingGoods business unit.

2003in CHF m

77.112.2

89.3

2002in CHF m

108.524.1

132.6

2003in CHF m

178.6–5.6

173.0

2002in CHF m

150.1– 4.7

145.4

2003in CHF m

63.633.4

34.953.5

185.4

2002in CHF m

69.138.7

46.837.2

191.8

49

17. Property, plant and equipmentin CHF m

CostAt 12/31/2002Currency translation effectsChanges in scope of consolidationAdditionsDisposalsReclassifications/revaluationsCost 12/31/2003

Accumulated depreciationAt 12/31/2002Currency translation effectsChanges in scope of consolidationOrdinary depreciation Extraordinary depreciationAccumulated depreciation on disposalsReclassifications/revaluationsAccumulated depreciation 12/31/2003

Net book value of property, plantand equipment 12/31/2003

Insurance values at 12/31/2003

Commercial

buildings

54.5

54.5

24.3

1.1

25.4

29.1

65.6

Factory

buildings

259.6 0.7 2.8 7.0

–0.7 0.1

269.5

103.2 0.3 0.1 8.2 2.0

–0.7

113.1

156.4

424.5

Plant and

machinery

151.8 2.0 3.5 8.7

–6.9 6.8

165.9

108.2 1.5 2.0 9.9 0.6

–6.9 0.8

116.1

49.8

193.2

Fixtures &

fittings,

vehicles

66.3 0.5 0.7 6.9

–6.1 –6.1 62.2

45.4 0.3 0.5 7.9

–5.4 –4.9

43.8

18.4

77.9

Assets

under con-

struction,

payments

on account

6.2 0.1

8.5

–11.6 3.2

0.0

0.0

3.2

Land

49.4 0.4 1.7 1.2

–0.1

52.6

2.0

0.2

2.2

50.4

Residential

buildings

125.3

125.3

25.7

2.2

27.9

97.4

122.5

Total

property,

plant and

equipment

713.1 3.7 8.7

32.3 –13.8 –10.8

733.2

308.8 2.1 2.6

29.5 2.6

–13.0 –4.1

328.5

404.7

Land includes real estate purchases in Memmingen (Ger-many) and Wolfhausen (Switzerland). Factory buildings in-creased through the installations in the new productionand administration building in Niederönz (Switzerland), thereticulation plant and extended foam production in Wolf-hausen (Switzerland), as well as an extension to the long-block and conditioning store in Leverkusen (Germany).In plant and machinery, investments were mainly in SheetMetal Processing Systems in Switzerland, Germany andChina.

The capitalized software costs are now shown underother intangible assets. Costs in the amount of CHF6.7 million were reclassified.

Land In construction zone 111 ha (previous year: 108 ha) Outside construction zone 18 ha (previous year: 21 ha)

50

18. Financial assets and intangiblefixed assets

in CHF m

CostAt 12/31/2002Foreign exchange differencesChanges in the scope of consolidationAdditions DisposalsReclassificationsCost at 12/31/2003

Accumulated depreciation At 12/31/2002Foreign exchange differencesChanges in the scope of consolidationOrdinary depreciation chargeExtraordinary depreciation chargeAccumulated depreciation on disposalsReclassificationsAccumulated depreciation at 12/31/2003

Net book value of financial assets and intangible fixed assets at 12/31/2003

Non-con-

solidated

participa-

tions

1.6

0.3

0.52.4

0.1

0.7

0.1

0.9

1.5

Long-term

receivables

and loans

5.50.10.36.6

–1.21.7

13.0

1.20.1

0.5

1.8

11.2

Securities

held as

fixed assets

0.3

–0.10.1

0.3

0.0

0.0

0.3

Total

financial

assets

7.40.10.27.0

–1.22.2

15.7

1.30.10.01.20.00.00.1

2.7

13.0

Good-

will

37.20.8

12.50.9

51,4

19.90.4

7.02.5

0.0

29.8

21.6

Total

intangible

assets

39.51.1

12.94.0

–0.211.5

68.8

22.20.60.39.22.5

–0.24.8

39.4

29.4

19. Assets pledged as securityTotal assets pledged amount to CHF 18.6 million (previous year:CHF 23.9 million), in respect of which there were no liabilities (previousyear: CHF 2.2 million).

20. Advance payments from customersCustomer payments on account relate mainly to the companies in theMachinery and Systems Engineering business area.

21. Other short-term liabilities

Short-term loansOther short-term liabilities

Total

2002in CHF m

0.213.6

13.8

2003in CHF m

1.215.6

16.8

50

Other

intangible

assets

2,30,30,43,1

–0.211.5

17.4

2.30.20.32.2

–0.24.8

9.6

7.8

The increases in long-term receivables and loans are due mainly to cus-tomer financing; the increases in other intangible assets concern principallythe SAP project at Bystronic Laser AG and the reclassification of softwarecosts from property, plant and equipment.

51

22. Accrued expenses and deferred incomeAccrued expenses and deferred income contains accrued income taxesamounting to CHF 15.3 million (previous year: CHF 14.8 million).

23. Financial liabilitiesShort-term:Borrowings from banks

Total

24. Other long-term liabilitiesOther long-term liabilities consist of interest-bearing loans from thirdparties and a discounted prepayment in respect of a long-term rentalagreement.

25. Provisionsin CHF m

Book value at 12/31/2002Currency translation effectsChanges in scope of consolidationAdditionsAmounts usedAmounts reversedReclassifications/revaluations

At 12/31/2003

The other provisions relate mainly to warranties, process and currency risksas well as to renovation of properties.

26. Share capitalTreasury shares amounting to CHF 0.1 million have been offset.The struc-ture of, and changes in, the share capital are summarized in the chapter onCorporate Governance; explanatory comments on treasury shares held aregiven in the notes to the financial statements of Conzzeta Holding.

2002in CHF m

13.1

13.1

2003in CHF m

0.4

0.4

Taxes

21.60.20.81.4

–4.21.2

21.0

Employee

pension

funds

1.50.1

–0.80.5

–0.2–0.0

1.1

Environ-

mental

commit-

ments

18.1

0.6–0.1

2.0

20.6

Guaran-

tees

12.2–0.0

0.62.9

–1.0–2.7

12.1

Other pro-

visions

32.70.1

–0.08.2

–0.5–2.8

4.1

41.7

Total

86.10.40.6

13.7–1.8–9.8

7.3

96.5

52

27. Changes in shareholders’ equityin CHF m

At 12/31/2001Group profit 2002Dividend paymentCapital reductionExchange movements

At 12/31/2002

Group profit 2003Dividend paymentCapital reductionSale of treasury sharesExchange movements

At 12/31/2003

Share capital

54.0 ––

–4.0 –

50.0

––

–4.0

46.0

Premium/capital

reserves

37.3 – –

–37.3–

0.0

––

0.0

Exchange

differences

–1.9–– –

–11.4

–13.3

––

–3.1

–16.4

Retained

earnings

616.845.1

–18.9 –4.8

–

638.2

22.8–11.4

4.00.6

–

654.2

28. Contingent liabilitiesIn connection with customer financing, there are repurchase obligations againstleasing companies for machinery amounting to CHF 14.8 million (previous year:CHF 13.2 million). In addition, there is a liability of CHF 1.4 million (previous year:CHF 1.4 million) for the purchase of a participating interest.

29. Derivative financial instrumentsin CHF m Contract values Replacement value

positive negative

12/31/2003 15.8 2.2 0.312/31/2002 45.5 3.2 0.1The contracts are entered into to hedge against USD exchange risks on existingand future accounts receivable.

30. CommitmentsCommitments in respect of long-term rental and leasing contracts with a period of notice longer than one year amount to CHF 3.0 million (previous year: CHF 0.2 mil-lion). In addition, there are long-term purchase commitments of CHF 4.0 million(previous year: CHF 5.4 million), in particular to secure exclusive supplies.

Consolidated cash flow statement

31. Acquisitions/divestment of business activitiesA total of CHF 18.5 million was used to acquire participating interests and businessactivities. In the previous year, acquisition of participating interests and businessactivities amounted to CHF 32.2 million, while divestments brought cash inflowstotaling CHF 46.6 million.

Total

shareholder’s

equity

706.245.1

–18.9–46.1–11.4

674.9

22.8–11.4

0.00.6

–3.1

683.8

53

EMPLOYEE PENSION FUNDSSWITZERLAND

Net fund assets at January 1

Fund capitalFluctuation reservesEmployer contribution reservesFree reserves

Total net fund assets at January 1

Net fund assets through changes in the scope of insurance coverage

Contributions and income

Company contributionsEmployee contributionsDeparture benefits brought into the fundInvestment income/loss

Total contributions and income

Payments and expenses

Payments to insured personsProvisions/valuation adjustmentsAdministrative expenses

Total payments and expenses

Net fund assets at December 31

Fund capitalFluctuation reservesEmployer contribution reservesOther reserves

Total net fund assets at December 31

2003in CHF m

374.96420.70033.524

7.123

436.311

–18.736

9.9687.1428.827

20.379

46.316

–32.437–3.381–0.731

–36.549

364.05026.20030.859

6.233

427.342

2002in CHF m

368.05236.70038.90733.833

477.492

–0.024

9.3536.791

11.976–37.607

–9.487

–28.270–2.685–0.715

–31.670

374.96420.70033.524

7.123

436.311

LIST OF MAJOR CONSOLIDATED COMPANIESBY BUSINESS UNIT

Company

Sheet Metal Processing SystemsBystronic Laser AG, Niederönz BEBeyeler Blecharbeitungsmaschinen GmbH, Gotha/DAFM (Tianjin) Machinery Co. Ltd.,Tianjin/China

Regional sales and service companies:Bystronic Inc., Hauppauge, New York/USA1

Bystronic AB, Märsta/SBystronic France S.A., Bièvres, Paris/FBystronic Italia S.r.l., Bovisio Masciago/IBystronic Laser GmbH, Leonberg/DBystronic Co. Ltd., Shanghai/ChinaBystronic Iberica S.A., San Sebastián de los Reyes/EBystronic Mexico S.A. de C.V., Mexico1

Bystronic Austria GmbH, Linz/ABystronic do Brasil Ltda., São José dos Pinhais/BrazilBystronic Pte. Ltd., SingaporeBystronic Benelux B.V., Hardinxveld-Giessendam/NLEdwards Pearson Limited, Somerset/UK1 These companies are also active in other business units.

Glass Processing SystemsBystronic Maschinen AG, Bützberg BELenhardt Maschinenbau GmbH, Neuhausen-Hamberg/DArmatec Vierhaus GmbH, Gunzenhausen/D

Regional sales and service companies:Bystronic Glass UK Ltd., Hadley/UKBystronic Asia Pte. Ltd., Singapore

Foam MaterialsFritz Nauer AG,Wolfhausen ZHReisgies Schaumstoffe GmbH, Leverkusen/DFrina Mousse France S.à r.l.,Wittenheim/FNeutex AG, Hinwil ZHBüttikofer AG, Gontenschwil AGSwisstex Inc., Greenville, South Carolina/USAREGI Polymer Produkte GmbH, Leverkusen/DWilhelm Reisgies GmbH & Co. KG, Leverkusen/D

Company capital

in local currency

50 0003 400 0913 996 000

500 000200 000

2 500 00013 00052 000

200 000137 000100 000300 000

1 200 000100

18 151105 000

100 0002 045 168

255 646

200 0001 000 000

5 000 0001 000 000

117 3862 500 000

250 0002 417 000

30 0001 000 000

Interest in %

direct indirect

100100100

100100100100100100100100100100 100 100100

100100100

100100

100100100100100

84100100

CHF

EUR

USD

USD

SEK

EUR

EUR

EUR

USD

EUR

MXP

EUR

BRL

SGD

EUR

GBP

CHF

EUR

EUR

GBP

SGD

CHF

EUR

EUR

CHF

CHF

USD

EUR

EUR

54

Company capital

in local currency

25 000 000500 000

516 580 500

250 0004 000 000

600 0003 500 0001 200 000

100 0001 000 000

100 00038 112

500 000540 000250 000

5 000 000100 000750 000

500 0007 500 0005 000 000

6 000 00050 000

100 000

Interest in %

direct indirect

100100

100100100

100

100100100

10010010010010066.7

50

100100100

100100100

100100

100

CHF

EUR

USD

NOK

GBP

CHF

CHF

CHF

CHF

CHF

CHF

CHF

EUR

CHF

CHF

CHF

CHF

CHF

CHF

CHF

CHF

CHF

EUR

EUR

CHF

Company

Sporting GoodsMammut Sports Group AG, Seon AGMammut Sports Group GmbH, Memmingen/DClimb High Inc., Shelburne VT/USAAjungilak AS, Oslo/NAjungilak UK Ltd., Ashton-under-Lyne/UKToko AG, Altstätten SG

Coating MaterialsSWISS LACK AG, Reussbühl LU Siegfried Keller AG,Wallisellen ZHSchmid Rhyner AG, Adliswil ZH

Sales companies for varnishes, paints and plasters:E. Beffa SA, La Chaux-de-Fonds NEColorsud SA,Torricella TlFarben Isler AG, BaselSiegfried Keller France SA,Wittenheim/FSWISS LACK Theler Perren AG, Glis VSTheler Morand SA, Sion VSJordan Peinture SA, Crissier VD

Real EstatePlazza Immobilien, ZurichDurischa Immobilien AG, Chur GRZiegelei Etzelkofen René Schachtler AG, Etzelkofen BE

Other Industrial ActivitiesRobert Seckler AG, Pieterlen BEPREBETON SA, Avenches VDTransall AG, Zurich

Conzzeta Holding Deutschland AG, Leverkusen/DConzzeta Grundstücksverwaltungs GmbH, Leverkusen/DConzzeta Management AG, Zurich

The shares in mammut tec AG, Seon AG and Transall Transporte AG,Zurich, have been accounted for using the equity method.

55

AUDITORS’ REPORTGROUP

Report of the Group Auditors to the General Meeting of Conzzeta Holding, Zurich

As Group auditors, we have audited the consolidated financial statementson pages 37 to 55 of Conzzeta Holding for the year ended December 31, 2003.

These consolidated financial statements are the responsibility of the Boardof Directors. Our responsibility is to express an opinion on these consoli-dated financial statements based on our audit.We confirm that we meetthe legal requirements concerning professional qualification and inde-pendence.

Our audit was conducted in accordance with auditing standards promul-gated by the Swiss profession, which require that an audit be planned andperformed to obtain reasonable assurance about whether the consolidatedfinancial statements are free from material misstatement.We have exam-ined on a test basis evidence supporting the amounts and disclosures in theconsolidated financial statements.We have also assessed the accountingprinciples used, significant estimates made and the overall consolidatedfinancial statement presentation.We believe that our audit provides a rea-sonable basis for our opinion.

In our opinion, the consolidated financial statements give a true and fairview of the financial position, the results of operations and the cash flows inaccordance with Swiss GAAP FER and comply with Swiss law.

We recommend that the consolidated financial statements submitted toyou be approved.

KPMG Fides Peat

Herbert Bussmann Markus AckermannSwiss Certified Accountant Swiss Certified AccountantAuditor in Charge

Zurich, February 27, 2004

56

INCOME STATEMENTHOLDING COMPANY

Income

Income from participationsResult from sale of participationsInterest income and income from securities

Total income

Expenses

Personnel expensesOperating expensesFinancial expensesTaxesDepreciation

Total expenses

Net income

2002in CHF m

54.298 38.282

8.873

101.453

–0.343 –1.034 –1.077 –0.160

–35.985

– 38.599

62.854

2003in CHF m

10.711 –0.136 10.580

21.155

–0.341 –2.288 –0.607 –0.197 –5.600

–9.033

12.122

57

58

BALANCE SHEET AT DECEMBER 31HOLDING COMPANY

Assets

Current assets

Cash, cash equivalents and securitiesAccounts receivablePrepaid expenses and accrued income

Total current assets

Fixed assets

ParticipationsOther financial assetsReceivables from Group companies

Total fixed assets

Total assets

2002in CHF m

71.318 0.263 1.177

72.758

160.000 33.044

187.053

380.097

452.855

2003in CHF m

42.546 0.039 0.483

43.068

190.000 0.100

192.857

382.957

426.025

59

Liabilities and shareholders’ equity

Short-term liabilities

Short-term payablesAccrued expenses and deferred income

Total short-term liabilities

Long-term liabilities

Payables to Group companiesProvisions

Total long-term liabilities

Shareholders’ equity

Share capitalLegal reservesSpecial reservesRetained earnings

Total shareholders’ equity

Total liabilities and shareholders’ equity

2002in CHF m

0.031 3.411

3.442

43.430 24.423

67.853

50.000 64.750

137.844 128.966

381.560

452.855

2003in CHF m

0.170 3.367

3.537

43.501 28.792

72.293

46.000 31.806

204.912 67.477

350.195

426.025

60

Sureties and guarantee obligations for subsidiariesof which taken up

Treasury shares1 000 unissued bearer shares (previous year: 21 000)with a par value of CHF 100.00 each0 bearer shares (previous year: 20 800)at acquisition cost of CHF 1487.67 each

ParticipationsSee overview on page 54 et seq.

Significant shareholdersTegula AG, Zurich Capital

Shares

12/31/2003in CHF m

76.82918.006

0.100

–

74%81%

12/31/2002in CHF m

67.94422.613

2.100

30.944

68%77%

NOTES TO THE FINANCIAL STATEMENTSHOLDING COMPANY

ADDITIONAL INFORMATION ON THE FINANCIAL STATEMENTSHOLDING COMPANY

61

Income statement

IncomeThe investment income for the yearwas CHF 10.7 million (previous year:CHF 54.3 million). In the previousyear, various Group companies paidextraordinary in-substance divi-dends.The result from sale of participationsof CHF –0.1 million contains variousadjustments on provisions from saleof participations. In the previousyear, this position contained incomefrom the sale of participations in Iff AG, Marmoran AG and Hard AG,amounting to CHF 38.3 million.The interest income and interest onsecurities of CHF 10.6 million is CHF 1.7 million higher than in theprior year.The interest income from accounts receivable fromGroup companies increasedcompared with the previous yearby CHF 2.8 million.The interestincome from third parties fell by CHF 1.1 million as a result of theCHF 28.8 million decrease in cash,cash equivalents and securities aswell as the lower interest rates.

ExpensesPersonnel and operating expensesinclude current administrationexpenses, costs for the OrdinaryGeneral Meeting, costs of theannual report, fees to the Board ofDirectors and project costs.Theincrease is due mainly to a changein the internal cost structure.The financial expenses of CHF 0.6 million result from intereston intergroup payables.Taxes of CHF 0.2 million contain

capital and income taxes for the fis-cal year of CHF 0.4 million and repaidGerman capital gains taxes on invest-ment income of CHF 0.2 million.Depreciation contains ordinary valueadjustments on participations.

Balance sheet

Current assetsLiquid assets in the form of bankbalances and monetary invest-ments in CHF, EUR and USD amountto CHF 31.0 million. Securities ofCHF 11.5 million consist of fixed-in-terest investments in CHF and EUR.Accounts receivable consist exclu-sively of withholding tax claims ondividends and interest income.Prepaid expenses and accruedincome consists mainly of interestaccruals on money market invest-ments and bonds as well as accru-als for balances from exchange ratehedges.

Fixed assetsThe figure for participating inter-ests in the balance sheet is CHF 190.0 million. In the reportingyear, the equity of Mammut SportsGroup AG and Conzzeta HoldingDeutschland AG was increased by a total of CHF 35.6 million.CHF 5.6 million was written downon the book value of investments.Financial assets of CHF 0.1 millionconsist of 1 000 unissued treasurybearer shares at par value.Most Group financing is handled bythe holding company.CHF 192.9 mil-lion was due from Group companies.

LiabilitiesThe short-term liabilities consistprimarily of accounts payable.Accrued expenses and deferredincome consists of outstandingcost accruals for the 2003 fiscal yearof CHF 1.1 million and incomepayable to subsidiaries from exten-sion of forward foreign exchangetransactions falling due in 2004 ofCHF 2.3 million.Long-term liabilities of CHF 72.3 mil-lion includes CHF 43.5 million in out-standing payables to subsidiariesand provisions of CHF 28.8 million.

Shareholders’ equityIn the reporting year, the share capi-tal was reduced by CHF 4.0 million.It now consists of 270 000 regis-tered shares and 406 000 bearershares, of which 405 000 have divi-dend and voting rights.The 1000bearer shares owned by the Com-pany have not been issued.The legal reserves consist of gen-eral reserves of CHF 31.7 million and reserves for treasury shares of CHF 0.1 million.The other reserves increased in thereporting year by CHF 67.1 millionto CHF 204.9 million.The change isdue to the transfer of CHF 62.2 mil-lion from the prior year’s retainedearnings, the addition of CHF 4.0 mil-lion from the reduction of the sharecapital and the sale of treasury sha-res of CHF 0.9 million.

PROPOSED APPROPRIATION OF AVAILABLE EARNINGS BY THE BOARD OF DIRECTORSHOLDING COMPANY

Net income for the yearRetained earnings carried forward from previous yearAvailable retained earnings

be appropriated as follows:

Dividend of CHF 20.00 (previous year: CHF 25.00) per bearer share entitled to dividend

Dividend of CHF 4.00 per registered share (previous year: CHF 5.00)

Transfer to the special reserve

Retained earnings to be carried forward

2003CHF

12 121 778 55 354 737

67 476 515

8 100 000

1 080 000

5 088 223

53 208 292

67 476 515

2002CHF

62 854 232 66 111 341

128 965 573

10 105 000

1 350 000

62 155 836

55 354 737

128 965 573

If this proposal is approved, the dividend distribution for the reporting year will be:

Gross 35% with- Net

dividend holding tax dividend

CHF CHF CHF

per bearer 20.00 7.00 13.00per registered share 4.00 1.40 2.60

The dividend on bearer shares will be paid out against submission of Coupon No. 5.

The registered shareholders or their custodian banks will be sent a dividend credit or dividend order, according to their instructions.

Coupon No. 5 and the dividend order can be redeemed free of charge from May 4, 2004, at all Swiss branches of the banks listed below:Credit Suisse First BostonUBS AGZurich Cantonal Bank

The Board of Directors proposes to the Annual General Meeting on April 29, 2004, that the retained earnings 2003, consisting of:

62

STATUTORY AUDITORS’ REPORTHOLDING COMPANY

Report of the Statutory Auditors to the General Meeting of Conzzeta Holding, Zurich

As statutory auditors, we have audited the accounting records and the financial statements (balance sheet, income statement and notes) ofConzzeta Holding for the year ended December 31, 2003.

These financial statements are the responsibility of the Board of Directors.Our responsibility is to express an opinion on these financial statementsbased on our audit.We confirm that we meet the legal requirements con-cerning professional qualification and independence.

Our audit was conducted in accordance with auditing standards promul-gated by the Swiss profession, which require that an audit be planned andperformed to obtain reasonable assurance about whether the financialstatements are free from material misstatement.We have examined on atest basis evidence supporting the amounts and disclosures in the finan-cial statements.We have also assessed the accounting principles used,significant estimates made and the overall financial statement presenta-tion.We believe that our audit provides a reasonable basis for our opinion.

In our opinion, the accounting records and financial statements and theproposed appropriation of available earnings comply with Swiss law andthe company’s articles of incorporation.

We recommend that the financial statements submitted to you beapproved.

KPMG Fides Peat

Herbert Bussmann Markus AckermannSwiss Certified Accountant Swiss Certified AccountantAuditor in Charge

Zurich, February 27, 2004

63

64

NET REVENUE FROM 1999 TO 2003(IN CHF MILLION)

1999 2000 2001 2002 2003

Sheet Metal Processing Systems

Glass Processing Systems

Foam Materials

Sporting Goods 1

Coating Materials

1 Until 12/31/1999 including rope and lifting technology for industrial applications

Real Estate and miscellaneous revenue

Other Industrial Activities

65

1999 2000 2001 2002 2003

Sheet Metal Processing Systems 282.2 379.9 378.2 358.1 369.034.3% 41.7% 38.9% 39.4% 40.3%

Glass Processing Systems 154.7 134.7 164.0 150.6 157.518.8% 14.8% 16.8% 16.6% 17.2%

Foam Materials 101.3 111.0 114.1 120.0 127.112.3% 12.2% 11.7% 13.2% 13.9%

Sporting Goods 1 79.7 74.6 108.8 105.6 114.29.7% 8.2% 11.2% 11.6% 12.4%

Coating Materials 108.8 110.2 108.8 103.7 101.713.2% 12.1% 11.2% 11.4% 11.1%

Real Estate and miscellaneous revenue 19.0 19.2 18.7 19.7 20.62.3% 2.1% 1.9% 2.1% 2.2%

Other Industrial Activities 77.5 81.7 80.3 51.6 26.59.4% 9.0% 8.3% 5.7% 2.9%

Total 823.2 911.3 972.9 909.3 916.6100% 100% 100% 100% 100%

1 Until 12/31/1999 including rope and lifting technology for industrial applications

Machinery and Systems Engineering

Consumer and Industrial Products

Real Estate and Other Industrial Activities

FIVE-YEAR SUMMARYGROUP

66

Consolidated income statement

Net revenueOperating resultExtraordinary profitGroup profit

Consolidated balance sheet

Current assetsFixed assetsShort-term liabilitiesLong-term liabilitiesMinority interestsShareholders’ equityTotal assetsShareholders’ equity as % of total assets

Investment in fixed assets/employees/net value added

Investment in property,plant and equipment Employees at year-endNet revenue per employeeNet value added

2000

911.372.9

4.464.7

686.1398.6231.7142.2

4.1706.7

1 084.765.2

24.02 402374.6300.6

2002

909.334.924.945.1

501.9427.7162.8

89.92.1

674.9929.6

72.6

67.62 831337.5276.8

2003

916.615.812.922.8

486.4447.2148.0

99.82.0

683.8933.6

73.2

32.32 838318.9266.8

in CHF m

in CHF m

in CHF m

in CHF m

in CHF m

in CHF m

in CHF m

in CHF m

in CHF m

in CHF m

in CHF m

%

in CHF m

Number

in CHF thousand

in CHF m

1999

823.253.035.272.9

654.7401.0171.6186.0

3.9694.3

1 055.865.8

39.82 303351.0266.4

2001

972.964.5

8.355.8

587.8428.0201.1103.5

4.9706.2

1 015.869.5

64.42 513391.2306.2

67

2002

50.0

446 000270 000

1210/855940

11.5

94.1018.80

144.4028.90

1 472.90294.60

25.005.00

2003

46.0

406 000270 000

1015/770980

9.2

49.709.90

61.0012.20

1 489.80298.00

20.004.00

Share information

Share capital

Number of shares issued at 12/31Bearer shares (par CHF 100)Registered shares (par CHF 20)

Market prices of the bearer sharesHighest/lowestYear-end

Total dividend

Key indicators per share(on capital entitled to dividend)

Group profit per bearer shareper registered share

Net cash flow from per bearer shareoperating activities per registered share

Shareholders’ per bearer shareequity per registered share

Gross dividend per bearer shareper registered share

in CHF m

Number

Number

CHF

CHF

in CHF m

CHF

CHF

CHF

CHF

CHF

CHF

CHF

CHF

1 Of these, 21 000 shares have neither voting

nor dividend rights2 Of these, 41 800 are treasury bearer shares,

of which 21 000 have neither voting nor dividend rights3 Of these, 1000 shares have neither voting

nor dividend rights4 As proposed by the Board of Directors5 Not including treasury bearer shares

3

4

5

5

4

4

2

5

5

2

5

5

1

5

5

1

5

5

1999

54.0

486 000270 000

1670/9901 630

51.9

140.4028.10

170.8034.20

1 333.70266.70

100.0020.00

2000

54.0

486 000270 000

1850/12261 840

23.4

124.6024.90

126.3025.30

1 357.60271.50

45.009.00

2001

54.0

486 000270 000

1849/11101 149

19.9

107.5021.50

65.9013.20

1 417.60283.50

40.008.00

INFORMATION FOR INVESTORSIN CONZZETA HOLDING

Investor RelationsFabio SorgesaPhone + 41 1 468 24 72Fax + 41 1 468 24 [email protected]

Ticker-SymbolsSwiss security number 265 798ISIN CH0002657986Telekurs CZHReuters ZZZZ.SBloomberg CZH SW

2004 Thursday, April 29

Tuesday, May 4

Beginning of June

Beginning of October

2005 End of March

Monday, May 2

Friday, May 6

93rd Ordinary General Meeting at the Lake Side Casino Zürichhorn, Zurich, at 5 p.m.

Payment of dividends

Interim report as at April 30, 2004

Interim report as at August 31, 2004

Year-end results as at December 31, 2004

94th Ordinary General Meeting at the Lake Side Casino Zürichhorn, Zurich, at 5 p.m.

Payment of dividends

68

This annual report is a translation of the official German language report.In case of interpretation differences the official German report will prevail.

Imprint

Publisher

Concept and design

Photos

Printing

Conzzeta Holding

Zurich

Facing Ltd

Zurich

Thomas Schuppisser

Zurich

Köpfli & Partner AG

Neuenhof

Conzzeta HoldingGiesshübelstrasse 45P.O. Box, CH - 8045 Zurich

Phone + 41 1 468 24 44Fax + 41 1 468 24 [email protected]

conzzeta

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