Uster Technologies Ltd | Annual Report 2011 Uster Technologies AG | Geschäftsbericht 2011 Think USTER – Think Quality
Uster Technologies Ltd | Annual Report 2011
Uster Technologies AG | Geschäftsbericht 2011
Think USTER – Think Quality
Milestones
1875 Establishment of an aerial telegraphy
workshop in Uster.
1927 Production of auxiliary weaving mill
machines started.
1944 Initiation of operations in the textile
electronics business.
1957 First publishing of USTER® STATISTICS.
1982 Cooperation with the Chinese textile
industry.
2003 Buyout from Zellweger Luwa by the
Management and two private-equity
investment companies.
2005 Development and assembly established
in China.
Sale of the one millionth USTER®
QuAnTum clearer.
2006 Uster Technologies Ltd was sold to its Man-
agement and funds advised by Alpha Be-
teiligungsberatung GmbH & Co. KG via a
secondary buyout.
2007 Listing on the main segment of SIX Swiss
Exchange.
2008 Introduction of new product groups
specifically targeting the mid-market
segment.
2009 Acquisition of ZWEIGLE® product range.
Broadening of existing shareholder base
with new strategic investor Toyota
Industries Corporation.
2010 Launch of ground-breaking third gen-
eration of USTER® QUANTUM clearer.
Meilensteine
1875 Gründung eines Betriebes für oberirdi-
sche Telegrafie in Uster.
1927 Start der Produktion von Hilfsmaschinen
für Webereibetriebe.
1944 Beginn der Aktivitäten im Bereich Tex-
tilelektronik.
1957 Erste Veröffentlichung der USTER®
STATISTICS.
1982 Zusammenarbeit mit der chinesischen
Textilindustrie.
2003 Buy-out aus der Zellweger Luwa Gruppe
durch das Management und zwei Pri -
vate-Equity-Gesellschaften.
2005 Aufbau eines Entwicklungs- und Mon-
tagestandortes in China.
1 Million USTER® QuAnTum Reiniger
verkauft.
2006 Uster Technologies AG wird im Rahmen
eines zweiten Buy-outs an das Manage-
ment sowie an durch die Alpha Beteili-
gungsberatung GmbH & Co. KG vertre-
tene Fonds verkauft.
2007 Kotierung am Hauptsegment der SIX
Swiss Exchange.
2008 Einführung von neuen, speziell auf die
Bedürfnisse des mittleren Marktsegments
ausgerichteten Produkten.
2009 Übernahme des Produktsortiments von
Zweigle.
Erweiterung des Aktionärskreises durch
den neuen strategischen Investor To-
yota Industries Corporation.
2010 Lancierung der wegweisenden dritten
Generation des USTER® QUANTUM
Garnreinigers.
Gross Sales
in CHF 1,000
2011 192,510
2010 132,841
2009 100,763
2008 154,893
2007 186,666
Net Result
in CHF 1,000 in percent of gross sales
2011 36,237
2010 20,763
2009 1,078
2008 5,316
2007 3,587
EBITA
in CHF 1,000 in percent of gross sales
2011 56,635
2010 34,602
2009 22,709
2008 34,168
2007 52,384
Free Cash Flow
in CHF 1,000 in percent of gross sales
2011 49,182
2010 39,011
2009 11,278
2008 29,409
2007 37,084
Achievements 2011
• 44.9% sales growth with strong EBITA margin of
29.4%.
• Excellent net result of CHF 36.2 million with further
reduction of net debt to CHF 40.7 million, demon-
strating the Company’s strong cash generation
ability and resulting in a strong balance sheet.
• Increased investments in R&D in order to further
strengthen product pipeline and to secure sustain-
able long-term growth.
• Significant sales growth in all product groups, in-
cluding record sales of the new USTER® QUANTUM 3
yarn clearer and substantial increases in labora-
tory fiber and yarn testing instruments.
• Rapid ramp-up of new automated production fa-
cilities, enhancing USTER’s flexible business mod-
el and allowing fast market penetration of new
products, with high levels of quality and reliability.
• Demonstrated market leadership at Shanghaitex
in China and ITMA 2011 in Barcelona, Spain.
• Introduction of the USTER Total Testing approach
enabling textile producers to improve the sustain-
ability of their business performance under the
slogan “From Uncertain Results to Predictable
Profits”.
Höhepunkte 2011
• Umsatzwachstum von 44.9% mit hoher EBITA-
Marge von 29.4%.
• Ausgezeichnetes Nettoergebnis in Höhe von CHF
36.2 Mio. und weiterer Abbau der Nettoschulden
auf CHF 40.7 Mio. Sie demonstrieren die ausgepräg-
te Fähigkeit des Unternehmens, liquide Mittel zu
generieren, und stärken die solide Bilanz weiter.
• Höhere Investitionen in F&E-Projekte zur Sicherung
eines nachhaltigen Wachstums.
• Markantes Umsatzwachstum in allen Produktgrup-
pen, einschliesslich des Rekordumsatzes mit dem
neuen USTER® QUANTUM 3 Garnreiniger und
deutlicher Steigerungen bei Faser- und Garnprüf-
systemen für Labors.
• Neue, automatisierte Fertigungsanlagen stärken
das flexible Geschäftsmodell von USTER und er-
möglichen eine schnellere Marktdurchdringung
neuer Produkte mit hoher Qualität und Zuverläs-
sigkeit.
• Demonstration der Marktführerschaft auf der
Shanghaitex in China und der ITMA 2011 in Barce-
lona, Spanien.
• Einführung des USTER Total Testing-Konzepts. Es
ermöglicht Textilherstellern, nachhaltige Erträge
zu erzielen – „From Uncertain Results to Predicta-
ble Profits“.
22.5 %
11.2 %
29.4%
26.0 %
25.5%
29.1 %
22.1 %
19.0 %
28.1 %
19.9 %1.9 %
3.4 %
18.8%
15.6 %
1.1 %
After Sales Services and Textile Technology
i i i i i i
Textile Production Process “Fiber to Fabric”
Process Step
USTER® Products
USTER® Complementary Products and Services
Products and Services
Ginning and cotton classing
Fiber testing Yarn testing Yarn clearing Fabric quality assurance
Intelligent sourcing
• INTELLIGIN® • HVI® Systems
• HVI® Systems • AFIS® PRO• LVI ®
• TESTER • TENSoRAPID® • TENSOjET® • CLASSIMAT® • SLIVERGUARD® • ZWEIGLE®
• QUANTUM • STATISTICS • CLASSIMAT® • TENSoRAPID® • TENSOjET® • ZWEIGLE®
• USTERIzED®
• INTELLIGENT SOURCING®
• Quality Profiles
USTER® STATISTICS and USTERIzED®
Integrated Data and Expert Systems
Portrait
The Uster Group is the leading high technolo gy
instrument manufacturer of products for qual-
ity measurement and certification for the textile
industry. The Group provides testing and
monitoring instruments, systems and services
that allow optimization and certification of qual-
ity through each individual stage of textile pro-
duction; from the raw textile fiber, such as cot-
ton, wool or synthetic filament yarns, to the
final finished fabric. The Uster Group provides
benchmarks that are the basis for the trading of
textile products at assured levels of quality across
global markets.
Uster Technologies Ltd was established in 1875
as an aerial telegraphy workshop in Uster (Swit-
zerland) and became an independent company
in 2003 following the acquisition of the zellwe-
ger Uster division of Zellweger Luwa by the Man-
agement and funds advised by two private-eq-
uity investment companies. In 2006 Uster
Technologies Ltd was acquired by its Management
and funds advised by Alpha Beteiligungsberatung
GmbH & Co. KG. In 2007 Uster Technologies Ltd
became a public company by listing its shares
on the SIX Swiss Exchange.
Kurzportrait
Uster Technologies AG ist der weltweit führen-
de Hersteller von Hightech-Produkten für die
Qualitätsprüfung und Zertifizierungen in der
Textilindustrie. Das Unternehmen bietet tech-
nologisch anspruchsvolle Systeme und Dienst-
leistungen an, welche die Herstellung von Pro-
dukten in optimaler Qualität auf jeder Stufe der
Textilverarbeitung gewährleisten; von der rohen
Textilfaser wie Baumwolle, Wolle oder synthe-
tischen Garnen bis zum fertigen Gewebe. Die
Uster Gruppe legt Qualitätsstandards fest, die als
Grundlage für den globalen Handel mit Textil-
produkten dienen.
Uster Technologies AG wurde 1875 als Betrieb
für oberirdische Telegrafie in Uster (Schweiz)
gegründet. Seine Selbständigkeit erlangte das
Unternehmen nach der Übernahme der Divisi-
on Zellweger Uster der Zellweger Luwa Gruppe
durch das Management sowie durch von zwei
Private-Equity-Gesellschaften vertretene Fonds.
2006 wurde Uster Technologies AG durch ihr
Management sowie durch von der Alpha Betei-
ligungsberatung GmbH & Co. KG betreute Fonds
erworben. Im Jahr 2007 wurde das Unternehmen
durch die Kotierung seiner Aktien an der SIX
Swiss Exchange zu einer Publikumsgesellschaft.
Knoxville, USA Charlotte, USA
Technology Centers
Regional Service Centers
Representative Offices
São Paulo, Brazil
Worldwide Sales and Support Network
The Group is headquartered in Uster, Switzer-
land, and operates through a worldwide Market
Organization complemented by Technology
Centers. It has sales and service subsidiaries in
the major textile markets and Technology Centers
in Uster (Switzerland), in Knoxville (USA) and in
Suzhou (China). The Swiss, American, and Chinese
facilities are certified according to the ISo 9001
standard. The Uster facility is focused on products
for yarn testing and on fabric quality assurance
whereas the Knoxville facility is focused on prod-
ucts for fiber testing and gin process control. The
Suzhou facility was set up in 2005 and is focused
on low-cost development and assembly opera-
tions as well as allowing the Group to establish a
local supply chain network to complement its
global supply chain management activities.
Weltweites Vertriebs- und Servicenetz
Die Uster-Gruppe hat ihren Hauptsitz in Uster in
der Schweiz und ist mit ihren Technologie-
zentren in Uster (Schweiz), Knoxville (USA) und
Suzhou (China) sowie einer ausgedehnten
Vertriebs- und Serviceorganisation weltweit in
den wichtigsten Textilmärkten vertreten. Die
Technologiezentren in der Schweiz, den USA
und in China sind nach der Norm ISo 9001 zerti-
fiziert. Das Werk in Uster ist auf Produkte für die
Garnprüfung und zur Qualitätssicherung von
Geweben spezialisiert, während sich Knoxville
auf Produkte zur Faserprüfung und Steuerung
des Entkörnungsprozesses konzentriert. Das
Werk in Suzhou wurde 2005 gegründet und kon-
zentriert sich auf kostengünstige Produktent-
wicklungen und Montage. Ausserdem ermög-
licht das Technologie zentrum in Suzhou der
Gruppe die Errichtung eines lokalen Lieferan-
tennetzes, das die weltweiten Aktivitäten im Be-
reich Supply Chain Management ergänzt.
Uster, Switzerland
Adana, Turkey
Bangkok, Thailand
Coimbatore, India
Suzhou, ChinaShanghai, China
São Paulo, Brazil
Osaka, Japan
Table of ContentsInhaltsverzeichnis
Foreword / Vorwort ........................................................................................................................................ 3
Operational Review / Operativer Rückblick ................................................................................................. 10
Outlook / Ausblick ....................................................................................................................................... 18
Corporate Governance ................................................................................................................................ 22
Comment on the Consolidated Financial Statements ................................................................................ 52
USTER Group – Consolidated Financial Statements .................................................................................. 54
USTER Group – Notes to the Consolidated Financial Statements .............................................................. 59
Report of the Statutory Auditor on the Consolidated Financial Statements ............................................. 102
Uster Technologies Ltd – Financial Statements ......................................................................................... 105
Uster Technologies Ltd – Notes to the Financial Statements ..................................................................... 107
Report of the Statutory Auditor on the Financial Statements ................................................................... 113
Information for Investors ........................................................................................................................... 115
Foreword | Vorwort 3
ForewordVorwort
Dear Fellow Shareholders
The theme of this year’s annual report is dedicated to
Uster Technologies Ltd’s approach to its business
typified by the slogan “Think USTER – Think Quality”.
This is credited for the exceptional 2011 results driven
by the Company’s leading position in a high-tech niche
market, steadfast customer orientation and high in-
novation power, underlined by the success of the
newest yarn clearer generation USTER® QUANTUM 3.
Further insight into each of these fundamental
drivers is presented on the image pages separating
the following chapters of this report.
Record Performance on All Levels
In the financial year 2011, Uster Technologies Ltd
achieved excellent performance levels surpassing the
previous highest sales achieved in 2007 before the
combined textile and financial market crisis. Sales of
products and services in all markets, both for textile
laboratories and manufacturing processes, contrib-
uted to these positive developments. New record sales
came from the combined excellent performance of
the new third generation of USTER® yarn clearers and
substantial increases in demand for laboratory yarn
and fiber testing instruments. USTER® QUANTUM 3,
sold through textile machinery manufacturers, meets
the need of textile producers’ to maximize the utiliza-
tion of highly priced cotton by efficiently manufac-
turing yarns with optimal and consistent quality
levels. Exemplary promotional campaigns and train-
ing programs accompanying the product’s introduc-
tion and culminating in the high-profile presentation
to a broad audience at the important ITMA 2011 trade
fair in Barcelona in September fueled strong sales
growth.
Sehr geehrte Aktionärinnen und Aktionäre
Das Thema unseres diesjährigen Geschäftsberichts
ist dem Leitmotiv von Uster Technologies AG gewid-
met, welches durch das Motto „Think USTER – Think
Quality“ verkörpert wird. Damit würdigen wir das
herausragende Geschäftsergebnis 2011. Es basiert auf
der führenden Position des Unternehmens in einem
Hightech-Nischenmarkt, der konsequenten Kunden-
orientierung und der hohen Innovationskraft. Letztere
wird von dem Erfolg der neuesten Garnreiniger-
Generation USTER® QUANTUM 3 zusätzlich unter-
strichen. Weitere Einblicke in diese zentralen Erfolgs-
faktoren vermitteln die Bildseiten zwischen den
einzelnen Kapiteln dieses Geschäftsberichts.
Bestleistung auf allen Ebenen
Im Geschäftsjahr 2011 erzielte Uster Technologies AG
ein ausgezeichnetes Ergebnis. Es übertraf die bishe-
rige Umsatzhöchstmarke aus dem Jahr 2007 vor der
kombinierten Textil- und Finanzmarktkrise. Zu die-
ser positiven Entwicklung trug der Absatz von Pro-
dukten und Dienstleistungen in allen Märkten bei –
sowohl für Textillabors als auch Textilhersteller. Der
neue Umsatzrekord ist auf den grossen Erfolg der
neuen dritten Generation von USTER® Garnreinigern
und den starken Nachfrageanstieg bei Garn- und Fa-
serprüfsystemen für Labors zurückzuführen. Der über
Textilmaschinenhersteller vertriebene USTER® QUAN-
TUM 3 erfüllt die Bedürfnisse von Textilherstellern,
die hochpreisige Baumwolle möglichst optimal zur
effizienten Produktion von Garn konstanter Qualität
einzusetzen. Vorbildliche Werbekampagnen und
Schulungsprogramme, welche die Produkteinführung
begleiteten, fanden ihren Höhepunkt im Auftritt des
Unternehmens vor einem breiten Publikum an der
wichtigen Fachmesse ITMA 2011 im September in
Barcelona. Der erfolgreiche Messeauftritt unterstütz-
te das kräftige Umsatzwachstum weiter.
4 Uster Technologies Ltd | Annual Report 2011
Ongoing Focus on Quality Improvements and
Process Automation
The positive market developments already seen in the
first half of financial year 2011 continued. Demand
for quality measurement and certification products
around the world was maintained at a high level. In
China and India, as well as in additional Asian markets,
the textile industry makes a significant contribution
to gross domestic product (GDP) and therefore con-
tinues to be a beneficiary of well-directed government
programs. Furthermore, the shift to automated pro-
duction in China gained further momentum due to
rising labor costs and in order to optimally use high-
priced raw materials. Producers generally put greater
emphasis on quality aspects as a means of achieving
adequate prices relative to the corresponding quality
and to minimize waste. In the cotton classing market,
the China Fiber Inspection Bureau (CFIB) and United
States Department of Agriculture (USDA) further
accomplished their ongoing expansion and replace-
ment plans.
To the Dawn of a New Era
In November 2011, Toyota Industries Corporation
announced an agreement to buy the remaining shares
of the private equity fund Alpha, thereby reaching
a controlling 50.34% stake in Uster Technologies Ltd’s
share capital. As stipulated by Swiss law and the
Company’s articles of association, Toyota Industries
Corporation shall make a mandatory takeover offer
at an offer price of CHF 44.00 per share for all pub-
Kontinuierlicher Fokus auf Qualitätsverbesserun-
gen und Prozessautomatisierung
Die positiven Marktentwicklungen, die bereits im ers-
ten Halbjahr des Geschäftsjahres 2011 zu beobachten
waren, setzten sich fort. Die Nachfrage nach Quali-
tätsprüfungs- und Zertifizierungssystemen zeigte
sich weltweit ungebrochen hoch. In China und Indien
und weiteren asiatischen Ländern leistet die Textil-
industrie einen wichtigen Beitrag zum Bruttoinland-
produkt (BIP) und wird deshalb durch gezielte staatli-
che Programme gefördert. In China beschleunigten
steigende Lohnkosten und das Bestreben einer opti-
malen Nutzung der teuren Rohstoffe den Automati-
sierungsprozess in der Produktion zusätzlich. Die
Hersteller setzten im Allgemeinen stärker auf Quali-
tätsaspekte, um adäquate Preise für die gewünschte
Qualität zu erzielen und den Ausschuss zu minimie-
ren. Im Bereich der Baumwollklassierung führten
die chinesische Behörde für Faserprüfung (CFIB)
und das US-Landwirtschaftsministerium (USDA) die
Realisierung ihrer laufenden Erweiterungs- und
Austauschpläne fort.
An der Schwelle zu einer neuen Ära
Toyota Industries Corporation gab im November 2011
bekannt, dass sie eine Vereinbarung zum Kauf des
restlichen Aktienpakets des Private Equity-Fonds
Alpha getroffen hat und somit eine Kontrollmehrheit
von 50.34% an der Uster Technologies AG erlangt.
Wie das Schweizer Recht und die Gesellschaftssta-
tuten vorschreiben, wird Toyota Industries Corpo-
ration ein Pflichtangebot zur Übernahme aller aus-
stehenden Namenaktien von Uster Technologies AG
in Höhe von CHF 44.00 pro Aktie vorlegen. Zudem
wird Toyota Industries Corporation als Mehrheits-
aktionär einer Dividende von CHF 2.50 pro Aktie
zustimmen, welche nicht vom Angebotspreis in
Abzug gebracht wird. Der somit angebotene Gesamt-
preis von CHF 46.50 pro Aktie impliziert einen
Eigenkapitalwert von CHF 393 Mio.
Die Textilmaschinen-Division von Toyota Industries
Corporation und Uster Technologies AG sind höchst
erfolgreiche Unternehmen. Sie nehmen führende
Positionen in komplementären Märkten ein. Durch
Max-Ulrich Zellweger, Geoffrey Scott
Foreword | Vorwort 5
licly held registered shares of Uster Technologies
Ltd. In addition, as a majority shareholder of USTER,
Toyota Industries Corporation will vote in favour of
a dividend payment of CHF 2.50 per USTER share
and such dividend will not be deducted from the of-
fer price. Thus the total consideration offered to the
shareholders of USTER in the amount of CHF 46.50
per share implies a total equity value for Uster of
CHF 393 million.
The Textile Machinery Division of Toyota Industries
Corporation and Uster Technologies Ltd are highly
successful companies with leading positions in
complementary markets. Thanks to the merger with
Toyota Industries Corporation, Uster Technologies
Ltd will have access to new technologies and market
segments, thereby strengthening its position as the
leader in textile certification and quality control
whilst broadening its coverage of the textile manu-
facturing market.
The Board of Uster Technologies Ltd believes that
the offered total consideration of CHF 46.50 per share
for all publicly held registered shares of Uster Tech-
nologies Ltd, CHF 8.50 above the price initially in-
dicated in November, is fair and in the interests of
both companies and their respective shareholders.
Therefore, the Board of Directors recommends that
shareholders of Uster Technologies Ltd accept the
offer of Toyota Industries Corporation. The combi-
nation of the two companies’ unique portfolios in
terms of technology and market expertise offers great
potential for joint business development opportuni-
ties, from which all stakeholders, including existing
and new customers, business partners and the highly
skilled staff of USTER, are likely to benefit.
den Zusammenschluss mit Toyota Industries Corpo-
ration wird Uster Technologies AG Zugang zu neuen
Technologien und Marktsegmenten erlangen. Dadurch
kann USTER ihre Position als Marktführerin bei
Zertifizierungs– und Qualitätsprüfungssysteme für
die Textilindustrie festigen und ausbauen.
Der Verwaltungsrat von Uster Technologies AG ist
der Ansicht, dass das Angebot in Höhe von insgesamt
CHF 46.50 pro Aktie für alle ausstehenden Namen-
aktien von Uster Technologies AG angemessen ist.
Das Angebot, welches CHF 8.50 pro Aktie über dem
im November ursprünglich gebotenen Preis liegt, ist
fair und wird den Interessen beider Unternehmen und
ihrer jeweiligen Aktionäre gerecht. Deshalb empfiehlt
der Verwaltungsrat den Aktionären von Uster Tech-
nologies AG, das Angebot von Toyota Industries Cor-
poration anzunehmen. Die Kombination der
Portfolios der beiden Unternehmen mit ihren einzig-
artigen Technologien und ihrer Marktexpertise bietet
enormes Potenzial für neue, gemeinsame Geschäfts-
entwicklungsmöglichkeiten. Davon dürften alle
Beteiligten bestehende und neue Kunden, Geschäfts-
partner und die hoch qualifizierten Mitarbeitenden
von USTER gleichermassen profitieren.
6 Uster Technologies Ltd | Annual Report 2011
Thanks
On behalf of the Board of Directors and the Executive
Committee, we thank all our employees for their strong
commitment and efforts, which allowed the Com-
pany to take advantage of new opportunities and to
leverage and expand the Group’s business activities
worldwide. Special thanks go to Richard Furter (Head
of Textile Technology) who retired after 44 years of
outstanding dedication and service to the Company.
He was a highly respected colleague and friend to many
people in the Company and we wish him all the very
best in his retirement. Harald Rönn (Vice-Chairman
of the Board of Directors), and Thomas Dressendörfer
(CFO), both resigned from their positions during the
course of the reporting period; we thank them for their
contribution to the Company’s current strength and
performance. At the same time we welcome our new
colleagues Thomas Nasiou (Head of Textile Technol-
ogy) and Peter Huber (CFO) to the Group’s Executive
Committee.
We also thank our customers, business partners and
suppliers for their excellent collaboration with our
teams. Finally, we express our thanks to Shareholders
for their confidence and support of the Company in
the past years.
Yours sincerely,
Max-Ulrich Zellweger
Chairman of the Board of Directors
Dank
Im Namen des Verwaltungsrates und der Konzern-
leitung danken wir allen Mitarbeitenden für ihren
grossen Einsatz. Mit ihrem Engagement ermöglichten
sie es dem Unternehmen, neue Chancen zu ergreifen
und die weltweiten Aktivitäten der Gruppe weiter aus-
zubauen. Ein besonderer Dank geht an Richard Furter
(Leiter Textile Technology). Er ist nach 44 Jahren en-
gagierter Tätigkeit und grossen Verdiensten für das
Unternehmen in den Ruhestand getreten. Er ist für
viele im Unternehmen ein äusserst geschätzter Kolle-
ge und Freund, wir wünschen ihm alles Gute in seinem
neuen Lebensabschnitt. Besonders danken möchten
wir auch Harald Rönn (Vizepräsident des Verwaltungs-
rates) und Thomas Dressendörfer (CFO). Beide sind
während des Geschäftsjahres aus dem Unternehmen
ausgeschieden. Sie haben wertvolle Beiträge zur
heutigen Stärke und Leistungsfähigkeit von Uster
Technologies AG geleistet. Gleichzeitig heissen wir
unsere neuen Kollegen Thomas Nasiou (Leiter Textile
Technology) und Peter Huber (CFO) in der Konzern-
leitung herzlich willkommen.
Des Weiteren danken wir unseren Kunden, Geschäfts-
partnern und Lieferanten für die ausgezeichnete Zu-
sammenarbeit mit unseren Teams. Nicht zuletzt
danken wir unseren Aktionären für ihr Vertrauen und
ihre Unterstützung des Unternehmens in den vergan-
genen Jahren.
Mit freundlichen Grüssen
Dr. Geoffrey Scott
Chief Executive Officer
Foreword | Vorwort 7
We are the leading high-technology instrument manufacturer of products for quality measurement and certification for the textile industry
Uster Technologies Ltd serves the world’s
textile market, the third-largest market
in the global economy. This dynamic
industry relies on the Company’s offering
for testing and quality control instruments.
Since consumers are becoming more
demanding about the quality of the textile
products they use, manufacturers have
a vested interest in measuring and
monitoring all production processes
throughout every stage of the textile
industry value chain.
Comprehensive expertise and a constant
quest for precision and perfection position
Uster Technologies Ltd as the unrivalled
market leader. USTER offers producers
unique know-how and expertise in
meeting current and future industry
requirements as well as in applying state-
of-the-art technology that enhances
production efficiency, quality excellence
and competitiveness.
10 Uster Technologies Ltd | Annual Report 2011
2011 reagierten alle wichtigen Märkte positiv auf die
besseren wirtschaftlichen Rahmenbedingungen. Dies
führte zu einer Marktbelebung, wenn auch der Aus-
blick durch die sich in der zweiten Hälfte der Berichts-
periode verschärfende Schuldenkrise eingetrübt
wurde. Sie belastete zunehmend wichtige Volkswirt-
schaften. Diese Entwicklungen nährten neue Ängste
vor einem Inflationsanstieg und dämpften den pri-
vaten Konsum.
Die internationalen Textilmärkte blieben von diesen
Tendenzen unberührt und setzten ihr Wachstum fort.
Die Hersteller stärkten ihren Fokus auf konstant hohe
Qualität der betrieblichen Abläufe und hergestellten
Produkte, um ihre Effizienz zu steigern und den Aus-
schuss zu minimieren und dadurch ihre Gewinne zu
maximieren. Die Märkte in China und Indien verzeich-
neten hohe Zuwachsraten und gaben die Richtung in
der Branche vor. Parallel dazu förderten steigende
Lohnkosten die Umstellung von manuellen Systemen
auf hoch automatisierte und integrierte Produktions-
verfahren. Dies steigerte die Nachfrage nach automa-
tisierter Produktionstechnologie, insbesondere au-
tomatischen Spulmaschinen, und damit auch die
Nachfrage nach Qualitätsmess- und -prüfsystemen.
Auch die lokalen Märkte in China und anderen asia-
tischen Ländern wie Vietnam, Kambodscha und In-
donesien wuchsen weit über dem Branchendurch-
schnitt. Als Reaktion auf die Bedürfnisse dieser
aufstrebenden Märkte baute Uster Technologies AG
ihr Produkt- und Dienstleistungsangebot im mittle-
ren Marktsegment aus und führte neue Qualitätsprüf-
systeme ein. Sie basieren auf den neusten Technolo-
gien und dem grossen Know-how von USTER®.
Neue Rekordumsätze
Uster Technologies AG erzielte im Geschäftsjahr 2011
ein ausgezeichnetes Geschäftsergebnis mit neuen
Rekordumsätzen. Der Bruttoumsatz der Gruppe er-
höhte sich gegenüber dem Vorjahr um 44.9 % auf
CHF 192.5 Mio. (2010: CHF 132.8 Mio.). Insgesamt trugen
die asiatischen Länder 67.6 % zum Gesamtbrutto umsatz
bei (2010: 67.3 %); auf Europa und Amerika entfielen
24.1 % bzw. 8.3 % (2010: 21.7 % bzw. 11.0 %). Das operati-
ve Ergebnis (EBITA) erhöhte sich auf CHF 56.6 Mio.
Operational ReviewOperativer Rückblick
In 2011 all major markets responded positively to the
improving economic environment, leading to increased
levels of business, even though the outlook was blurred
by the intensifying debt crisis affecting major econ-
omies in the second half of the reporting period. These
developments renewed fears of an upcoming inflation
cycle and started to depress consumer spending.
Textile markets worldwide were not yet affected by
these trends and continued to grow. Producers inten-
sified their focus on improving both the level of, and
consistency of quality in their operations and manu-
factured products in order to maximize earnings by
enhancing efficiency and minimizing waste. China
and India performed strongly and set the course
within the industry. In parallel, rising labor costs drove
a switch from manual systems to highly automated
and integrated production processes. The result was
increased demand for automated production machin-
ery, including automatic winding machines, further
boosting the demand for the associated quality mea-
suring and control instruments.
Furthermore, local markets in China and in other Asian
countries such as Vietnam, Cambodia and Indonesia
grew well above the average industry rates. In response
to the needs of these emerging markets Uster Tech-
nologies Ltd expanded its offering and services to the
mid-market segment with new quality control systems
featuring the latest USTER® state-of-the-art technol-
ogy and expertise.
New Record Sales
In the financial year 2011, Uster Technologies Ltd
posted strong performance levels and achieved new
record sales. The Group’s gross sales grew to CHF 192.5
million, an increase of 44.9 % compared to the previ-
ous year result of CHF 132.8 million. Overall sales in
the Asian markets contributed 67.6 % to total gross
sales (2010: 67.3 %); Europe and Americas generated
24.1 % and 8.3 % of total sales (2010: 21.7 % and 11.0 %).
EBITA increased to CHF 56.6 million, 63.7 % above the
CHF 34.6 million reported in financial year 2010. The
EBITA margin improved to the high level of 29.4 %
compared to 26.0 % in 2010 and the net result amount-
ed to CHF 36.2 million, 74.5 % above the CHF 20.8 mil-
Operational Review | Operativer Rückblick 11
und lag damit um 63.7 % über dem Vorjahreswert von
CHF 34.6 Mio. Die EBITA-Marge konnte ebenfalls auf
das hohe Niveau von 29.4 % (2010: 26.0 %) verbessert
werden. Das Nettoergebnis stieg um 74.5 % von
CHF 20.8 Mio. im Jahr 2010 auf CHF 36.2 Mio. im Jahr
2011. Dieses Wachstum ist hauptsächlich auf die Vor-
teile zurückzuführen, die der Gruppe aus ihrer schlan-
ken Organisationsstruktur erwachsen. Der Cashflow
aus operativer Tätigkeit wurde grösstenteils zum
weiteren Abbau der Schulden auf CHF 70.0 Mio. ver-
wendet. Dies unterstreicht die ausgeprägte Fähigkeit
der Gruppe, liquide Mittel zu generieren.
Die Geschäftsleitung hat sich das Ziel gesetzt, weiter-
hin rund 10 % des Gesamtumsatzes in F&E zu investie-
ren, um das nachhaltige Wachstum des Unternehmens
zu sichern. 2011 beliefen sich die F&E-Aufwendungen
auf CHF 18.2 Mio. Dies entspricht einem Umsatzanteil
von 9.4 % (2010: CHF 14.9 Mio.; 11.2 %).
Alle Produktgruppen über den Vorjahres-
ergebnissen
Die höheren Umsätze aller Produktgruppen trugen
zu dem soliden Ergebnis im Geschäftsjahr 2011 bei.
Sie lagen alle deutlich über dem Vorjahresniveau. Der
Absatz an Textilmaschinenhersteller und Produzen-
ten automatischer Spulmaschinen profitierte stark
von der Lancierung der neuen dritten Garnreiniger-
Generation USTER® QUANTUM 3. Das innovative
System kam zu einem günstigen Zeitpunkt auf den
Markt, als die Textilindustrie zu Wachstum zurück-
fand und die Maschinenhersteller und Textilprodu-
zenten wieder in Qualität zu investieren begannen.
Zur Bewältigung der hohen Nachfrage stellten die
USTER-Teams erfolgreich sicher, dass alle verfügba-
ren Ressourcen effizient genutzt wurden. Hierzu
gehörten die Inbetriebnahme und der schnelle Produk-
tionsanlauf neuer automatisierter Fertigungsanlagen.
Sie verbesserten die betrieblichen Abläufe und ermög-
lichten einen erheblichen Produktivitäts- und Flexi-
bilitätsgewinn. Hinzu kamen weitere Verbesserungen
in Bezug auf Qualität, Qualitätskonstanz, Leistung
und Zuverlässigkeit der Produkte. Basierend auf dem
schlanken, flexiblen Geschäftsmodell von USTER,
wirkten sich weiter das kompetente Supply Chain
lion achieved in 2010. This growth was mainly driven
by improved operational leverage based on the Group’s
lean organization. The cash flow from operational
activities was mainly used to pay down debt to
CHF 70.0 million, underlining the Group’s strong
cash generation ability.
Management remains committed to investing around
10 % of total sales in R&D, thereby ensuring continued
sustainable growth of the organization’s operations.
In 2011 expenses for R&D amounted to CHF 18.2 mil-
lion, which corresponds to 9.4 % of total sales (2010:
CHF 14.9 million; 11.2 %).
All Product Groups Above Previous Year Results
Increased sales of all product groups contributed to
the solid results in the financial year 2011 and clearly
exceeded the levels achieved in the prior year. Sales
to textile machinery manufacturers and producers
of automated winding machines were strong thanks
to the launch of the new third generation of USTER®
QUANTUM 3 clearer. This innovative device hit the
markets at a favorable time when the textile industry
was shifting back into a growth gear and new invest-
ments in quality returned to the focus of textile ma-
chinery manufacturers as well as textile producers.
In order to meet the high demand, the USTER teams
successfully organized an efficient use of all available
resources. This included the commissioning and fast
ramp-up of new automated manufacturing systems,
a major step forward in our operations that allows for
significant improvements in productivity and flex-
ibility, along with assuring yet further improvements
in the level and consistency of quality, performance
and reliability of our own products. A further positive
impact arising from the Group’s lean and flexible busi-
ness model is an inherent expertise in supply chain
management and working with outsourcing partners.
Our specialists managed to rapidly build up a com-
pletely new supply chain as well as tooling and qual-
ity processes for the new product group. This was
achieved in spite of some challenges early in the year
with the supply of electronic components resulting
from ‘empty supply streams’ after the crisis along with
some disruptions following the Tsunami in Japan.
12 Uster Technologies Ltd | Annual Report 2011
Management und die gute Zusammenarbeit mit
Outsourcing-Partnern positiv aus. Die USTER-Spe-
zialisten bauten innerhalb kürzester Zeit eine völlig
neue Lieferkette und die entsprechenden Tooling- und
Qualitätsprozesse für die neue Produktgruppe auf.
Dabei waren sie mit einigen Lieferengpässen und
Unterbrechungen bei elektronischen Bauelementen
Anfang des Jahres nach dem Tsunami in Japan kon-
frontiert. Die Fertigungs- und Supply-Chain-Teams
nahmen diese Herausforderungen an und bemühten
sich akribisch und systematisch, Probleme zu lösen
und die Auswirkungen auf die Produktlieferungen
an die Kunden zu minimieren. Sie verdienen beson-
dere Anerkennung für diesen herausragenden Einsatz.
In den Kundenmärkten stimulierten die hohen Roh-
stoffpreise die Nachfrage nach Qualitätsprüfungs- und
Zertifizierungssystemen. Im Bereich der Baumwoll-
klassierung unterstützte USTER die Erweiterungs- und
Austauschprogramme des US-Landwirtschaftsmi-
nisteriums (USDA) und der chinesischen Behörde für
Faserprüfung (CFIB). Neben diesen Initiativen in den
wichtigen US-amerikanischen und chinesischen
Märkten gewannen die Teams auch Aufträge aus an-
deren Baumwollregionen wie Indien, Afrika und Zen-
tralafrika. Sie trugen zu einer Diversifizierung der
Kundenbasis bei und bestätigen das Vertrauen in
USTER als führendes Unternehmen in der Baumwoll-
klassierung.
Die Nachfrage nach Prüfsystemen, sowohl für Tex-
tillabors als auch für Textilproduzenten, stieg im
Berichtszeitraum weiter an. Die Textilhersteller er-
kannten die Vorteile aus einer effizienten Produktion
in optimaler und konstanter Qualität.
Im Kundenservice stärkte die Uster-Gruppe ihre Be-
ziehungen zu breiten Kreisen von Textilhändlern und
förderte deren Interesse an verschiedenen wertstei-
gernden Dienstleistungen, wie zum Beispiel Intelligent
Sourcing, dem USTERIZED®-Label und den USTER®
STATISTICS. Das After-Sales-Geschäft entwickelte sich
parallel zum Umsatz mit den Prüfsystemen.
These challenges were mitigated through the dili-
gent and systematic focus of our manufacturing and
supply chain teams to resolve issues and to ensure
minimal impact on the supply of products to our cus-
tomers. They deserve special congratulations for their
outstanding efforts.
In our customer markets, high raw material prices
supported demand for quality measurement and cer-
tification products. In the classing business, USTER
further intensified its dedicated support to the expan-
sion and replacement programs of the United States
Department of Agriculture (USDA) and China Fiber
Inspection Bureau (CFIB). Besides these efforts in the
important US and Chinese markets, our teams secured
additional business in further cotton growing markets
such as India, Africa and Central Asia, thereby diver-
sifying the customer base and confirming the trust
in USTER as the authority in cotton classing.
The demand for testing systems, both in textile labo-
ratories and in the manufacturing process, continued
to increase during the reporting period as textile pro-
ducers expressed a need for efficient manufacturing
at optimal and consistent quality levels.
In the customer service business, the Uster Group
strengthened its strong relationships with its wide
textile retailer base, enhancing interest in a number
of value-adding services, including Intelligent Sour-
cing, USTERIZED® certification and USTER® STATIS-
TICS. The after-sales service business was maintained
in line with instrumentation sales.
Operational Review | Operativer Rückblick 13
Demonstration der Marktführerschaft
Uster Technologies AG führte die umfangreichen
Marketing- und Schulungsprogramme für ihre Pro-
duktgruppen fort. Diese Programme wurden speziell
entwickelt, um Kunden einen besseren Einblick in
die Steuerung der Qualität, Produktivität und Ren-
tabilität mit Hilfe von USTER®-Systemen, USTER®
Best Practices und USTER® STATISTICS zu geben. Das
Unternehmen intensivierte auch seine Beziehungen
zu grossen Textilhochschulen in China und veröffent-
lichte ein von Richard Furter verfasstes Fachbuch mit
dem Titel „Textile Measuring Technology and Qua-
lity Control”. Das Buch bringt die allseits anerkannten
Kenntnisse und die grosse Fachkompetenz von Richard
Furter zum Ausdruck.
Uster Technologies AG war 2011 auf zwei bedeutenden
Fachmessen vertreten: der Shanghaitex in China und
der wichtigen ITMA 2011 in Barcelona, Spanien. Die
Marketing- und Technologieexperten von USTER
nutzten die Gelegenheit, das hochkarätige Branchen-
publikum anzusprechen und auf den Mehrwert des
USTER® Produkt- und Dienstleistungsangebots auf-
merksam zu machen. Im Mittelpunkt des Auftritts
an der ITMA 2011 stand die Einführung des neuen
USTER® „Total Testing“-Konzepts unter dem Motto
„From Uncertain Results to Predictable Profits“. Die
Vorteile, die aus dem Total Testing-Ansatz erwachsen,
beruhen auf einer Kombination von Laborprüfung,
Prozessüberwachung und Know-how, die den Tex-
tilunternehmen einzigartige Möglichkeiten zur Op-
timierung ihrer betrieblichen Abläufe und Sicherung
einer nachhaltigen Geschäftsentwicklung eröffnen.
Textilhersteller müssen heute in allen operativen Be-
langen Spitzenleistung erbringen, um kontinuierli-
ches Wachstum und nachhaltige Ergebnisse zu er-
wirtschaften. Dies gelingt nur mit dem richtigen
Gleichgewicht zwischen einer Minimierung der Kos-
ten und konstanter Erfüllung der geforderten Quali-
tät – was eine genaue Kontrolle der Garnqualität er-
fordert.
Demonstrated Leadership
Uster Technologies Ltd continued to offer extensive
promotional and educational programs for its prod-
ucts groups. These programs have been specifically
designed to enhance customers’ understanding of
how to manage quality, productivity and profitabil-
ity with the help of USTER® instruments, USTER®
best practices and USTER® STATISTICS. The Com-
pany also intensified its relationships with major
textile Universities in China, along with publishing
a textbook entitled “Textile Measuring Technology
and Quality Control” written by Richard Furter. This
will represent a proud legacy recognizing his acknowl-
edged know-how and expertise.
Uster Technologies Ltd was present at both important
trade fairs in 2011, the industry fair Shanghaitex in
China and the important ITMA 2011 in Barcelona, Spain.
USTER marketing and technology experts took ad-
vantage of the chance to address high-level industry
audiences and highlight the added value that its prod-
uct and service portfolio offers to customers. At ITMA
2011, the central theme of the Group’s presence was
dedicated to the introduction of the new USTER® To-
tal Testing approach, under the banner “From Uncer-
tain Results to Predictable Profits”. Total Testing is
based on a unique combination of laboratory testing,
process monitoring and know-how and it provides
textile companies with unique possibilities to trans-
form their operations and give the opportunity to
assure the sustainability of their business. Today,
textile producers must excel in all areas of their op-
erations in order to achieve sustainable growth and
results. The essential need is to strike the right balance
between minimizing costs and consistently achieving
the required quality – which demands proper control
of yarn quality.
14 Uster Technologies Ltd | Annual Report 2011
Am 22. September, zeitgleich mit der Eröffnung der
Fachmesse ITMA 2011, lancierte Uster Technologies
AG ihre neue Unternehmenswebsite. Sie informiert
die Kunden, Branchen- und Geschäftspartner ebenso
wie die Mitarbeitenden und Anleger über die Aktivi-
täten des Unternehmens. Insbesondere vermittelt die
Website den Lesern einen verständlichen Einblick in
das Angebot der Gruppe. Die neue Website wurde von
den verschiedenen Zielgruppen sehr gut aufgenom-
men. Sie alle schätzen die Bemühungen von USTER®
für einen laufenden Dialog und regelmässigen Infor-
mationsaustausch mit dem Ziel, den Mehrwert der
USTER® Produkte und Dienstleistungen weiter zu
optimieren.
On September 22, the same day that the ITMA 2011
trade fair opened its doors, Uster Technologies Ltd
launched its new corporate website. It offers clients,
industry and business partners as well as employees
and investors comprehensive information on the
Company’s activities. In particular, the site provides
readers with an insight into the Group’s offering in a
reader-friendly style. The new website has been re-
ceived very well by the various target groups, all of
which have expressed their appreciation of the Com-
pany’s effort to maintain an ongoing dialogue and
regular exchange of information to optimize the
added value resulting from USTER® products and
services.
Operational Review | Operativer Rückblick 15
We are committed to a comprehensive understanding of all aspects of our customers’ needs.
In today’s challenging textile markets,
companies can no longer rely on just a
few basic skills. To achieve sustainable
results by generating added value for
their customers, they must excel in all
areas of their operation.
The essential need is to strike the right
balance between minimizing costs
and consistently achieving the required
quality. This demands effective and
efficient control of yarn quality.
USTER has developed an unique ap-
proach to this challenge through the
combination of laboratory testing, process
monitoring and know-how. This approach
is called “Total Testing”. It helps textile
companies to transform their business by
turning uncertain results to predictable
profits – thanks to a shift from random
sampling to continuous testing and the
change from varying to consistent and
subjective to objective quality control
throughout the entire textile value chain
from fiber to fabric.
18 Uster Technologies Ltd | Annual Report 2011
Uster Technologies AG geht gegenwärtig davon aus,
dass die Nachfrage nach Qualitätsprüfungs- und Zer-
tifizierungssystemen zur Sicherung der erreichten
Profitabilität von Textilherstellern anhalten wird.
Ausserdem wird der Fokus auf Prozessoptimierung
sowie Modernisierung und Automatisierung der
Textilproduktion in China als Wachstumstreiber an-
halten. Die Textilindustrie ist bekanntlich eine zyk-
lische Branche und die Lieferanten dieser Industrie
sind sich einig, dass 2012 ein Abschwung im Zyklus
einsetzen wird. Es wird allerdings eine „weichere
Landung“ als in der Krise 2008/2009 erwartet. Die
Geschäftsleitung von USTER schliesst sich dieser
Auffassung an, unter der Annahme, dass es keine
weitere Finanzkrise oder grössere Konjunkturrück-
schläge geben wird. Wie es die Vergangenheit zeigte,
gehört Uster Technologies AG jeweils zu den Letzten,
die von dem Zyklus erfasst werden, und zu den Ersten,
die sich nach dem Tiefpunkt wieder erholen. Die
Geschäftsleitung erwartet 2012 daher einen Umsatz-
rückgang, jedoch unter Aufrechterhaltung der hohen
Profitabilität. Diese Einschätzung wird durch die
Erfahrung der letzten Jahre und die starken finan-
ziellen Ergebnisse untermauert.
Unter der Annahme, dass das Übernahmeangebot
von Toyota Industries Corporation von den Aktionä-
ren von Uster Technologies AG angenommen wird,
dürfte die strategische Zusammenarbeit zwischen
den beiden Unternehmen weiter intensiviert werden.
Die 2009 eingeleiteten Geschäftsentwicklungspro-
jekte zielen darauf ab, Synergien aus den einzigartigen
Technologie-Portfolios und den ausgezeichneten
Marktpositionen in komplementären Branchen-
segmenten zu realisieren und versprechen in naher
Zukunft weiteres Wachstumspotenzial.
Uster Technologies AG ist bestrebt, Textilherstellern
auch künftig einzigartiges Know-how und Fachwis-
sen anzubieten, um die heutigen und künftigen An-
forderungen der Industrie zu erfüllen. Die USTER®
State-of-the-Art-Technologien ermöglichen den Kun-
den, ihrer Produktionseffizienz und Qualitätsstandards
zu verbessern und damit ihre Wettbewerbsfähigkeit
zu stärken.
OutlookAusblick
Uster Technologies Ltd is currently expecting that
the demand for quality measurement and certification
products as a means to sustained profitability for
textile producers will continue. In addition, the focus
on process optimization and the trend for moderniza-
tion and automation of textile production equipment
in China will remain as a driver of growth. The textile
industry is known to be cyclical and the consensus
among the suppliers to the industry is that we will
see a downturn in the cycle in 2012, but more of a soft
landing rather than the crisis that was seen in 2008
– 2009. The management of USTER supports this view,
under the assumption that there is not a further fi-
nancial crisis or major economic disruption. But as
the Company has demonstrated in the past, we will
be one of the last to go into the cycle and one of the
first to come out after recovery. As a result, manage-
ment expects to see a decline in sales in 2012, but strong
profitability will be maintained. Experience gained
over the past years along with a proven track record
of delivering strong financial performance underpins
this view.
Assuming the takeover offer of Toyota Industries Cor-
poration is supported by Uster Technologies Ltd’s
shareholders, it is likely that the strategic collaboration
between the two companies will be further intensified.
The joint business development projects already
initiated in 2009 are targeting synergies arising from
both companies’ unique technology portfolios and
excellent market positions in complementary indus-
try segments and are expected to yield further growth
potential in the near future.
In the future, Uster Technologies Ltd seeks to offer
textile producers unique know-how and expertise in
meeting current and future industry requirements
as well as in applying state-of-the-art technology that
enhances customers’ production efficiency, quality
excellence and competitiveness.
Outlook | Ausblick 19
We strive for innovations that make a difference to our customers.
USTER® QUANTUM 3 represents a new
generation of yarn clearers that calculates
and proposes state-of-the-art settings for
optimal yarn clearing. The new system
bases on the know-how and experience of
the Company’s leadership in the market.
USTER pursued a courageous and
ambitious path in its quest to provide
markets with a major technological
advance. Group’s zero tolerance policy
requested automatic setting in order to
ensure reliable and most efficient yarn
clearing. This set the stage for one of
USTER’s biggest innovations yet – the
illustration of each yarn body based on
data collected by powerful sensors.
The new capacitive and optical sensor
technology visualizes all disturbing
defects, thereby enabling manufacturers to
efficiently sort out all major yarn quality
deviations.
22 Uster Technologies Ltd | Annual Report 2011
Corporate Governance
The information disclosed in this section follows the Directive on Information Relating to Corporate Governance
issued by the SIX Swiss Exchange and complies largely with the Swiss Code of Best Practice for Corporate Gov-
ernance issued by Economiesuisse. Uster Technologies Ltd (the Company) has implemented these principles
of good corporate governance in its articles of association, its organizational rules and its code of conduct.
All information shown in this section applies to the balance sheet date if not indicated otherwise. Significant
changes between the balance sheet date and the copy deadline of the annual report are listed under “10 Material
Changes since the Balance Sheet Date” at the end of this section.
Further information on Corporate Governance can be found by visiting Uster Technologies Ltd’s website at
www.uster.com/investors
1 Group Structure and Shareholders
1.1 Group Structure
1.1.1 Operational Structure
The operational structure of the Uster Group is illustrated below:
Board of Directors
4 members
Chairman Max-Ulrich Zellweger
Executive Committee
9 membersCEO Geoffrey Scott
Marketing and Business
Development
Reine Wasner
Sales and Service
Harold Hoke
Textile Technology
Thomas Nasiou
Research and Innovation
Rafael Storz
U.S. Operations
Hossein Ghorashi
Asian Operations
Naiming Wei
Order Fulfi llment
Renato Murk
Finance and Support
CFO Thomas F. Dressendörfer(until October 31, 2011)
Peter Huber(starting from January 1, 2012)
Corporate Governance 23
1.1.2 Listed Companies within the Group
Uster Technologies Ltd, Uster, Switzerland, is the parent company of the Uster Group and has been listed
according to the Main Standard of the SIX Swiss Exchange since October 19, 2007. It is the sole listed com-
pany within the Group.
Market capitalization CHF 348,552,000
SIX Swiss Exchange Ticker Symbol USTN
Swiss Security Number 3433153
ISIN CH0034331535
1.1.3 Non-Listed Companies within the Group
The table below shows an overview of the non-listed companies of the Uster Group as of December 31, 2011:
Company Purpose % Capital Shareholdings
Dec 31, 2011
Share Capital in 1,000
Uster Technologies de Mexico S.A. de C.V.(Tlalnepantla, MX) D 100 % MXN 6,250
Uster Technologies GmbH(Neuss, DE) D 100 % EUR 26
Uster Technologies (India) Pvt. Ltd(Bangalore, IN) SC 100 % INR 4,950
Uster Technologies (India) Marketing Pvt. Ltd(Bangalore, IN) S 100 % INR 100
Uster Technologies K.K.(Osaka-fu, JP) SC 100 % JPY 10,000
Uster Technologies (Shanghai) Trading Co. Ltd(Shanghai, CN) S 100 % CNY 5,654
Uster Technologies (Suzhou) Co. Ltd
(Suzhou, CN) TC 100 % CNY 20,185
Uster Technologies Sulamericana Ltda.(Alphaville-Barueri SP, BR) SC 100 % BRL 523
Uster Technologies (Thailand) Ltd(Bangkok, TH) SC 100 % THB 6,000
Uster Technologies Holding (Thailand) Ltd(Bangkok, TH) H 100 % THB 1,000
Uster Technologies, Inc.(Knoxville, US) TC 100 % USD 100
Uster Teknoloji Ticaret A.S.(Istanbul, TR) SC 100 % TRY 50
TC: Technology Center
SC: Service Center
S: Sales Office
H: Holding
D: Dormant
24 Uster Technologies Ltd | Annual Report 2011
1.2 Significant Shareholders
As of December 31, 2011, 819 shareholders (2010: 880) were registered in the share register of Uster Tech-
nologies Ltd. In the course of 2011 the following disclosure announcements were made according to article
20 et seq. of the Swiss Federal Stock Exchange and Securities Trading Act (SESTA):
• Balfidor Fondsleitung, CH-Basel, informed that its stake in the Company’s share capital decreased to below
3.0 % (published on January 19, 2011).
• Marc Philipp Bär, CH-Zurich, informed that his stake in the Company’s share capital went to below 3.0 %
(published on January 29, 2011).
• The shareholders group around Geoffrey Scott holding 8.1 % of the Company’s share capital changed its
composition (published on February 4, 2011), now including Max-Ulrich Zellweger, CH-Meggen; Barry
James Mulady, UK-East Sussex; Geoffrey Scott, CH-Erlenbach; Thomas F. Dressendörfer, CH-Stäfa; Hos-
sein Ghorashi, US-Knoxville Tennessee; Naiming Wei, CN-Shanghai; Richard Furter, CH-Zug; Rafael Storz,
CH-Kreuzlingen; Deniz Bütüner, CH-Fällanden; Harold R. Hoke, US-Charleston, South Carolina; Renato
Murk, CH-Egg; Reine Wasner, S-Stockholm.
• Balfidor Fondsleitung, CH-Basel, announced that its stake in the Company’s share capital increased to
3.04 % (published on April 7, 2011).
• T. Rowe Price International Inc. informed that its stake in the Company’s share capital decreased to below
3.0 % (published on May 21, 2011).
• Balfidor Fondsleitung, CH-Basel, informed that its stake in the Company’s share capital decreased to below
3.0 % (published on June 7, 2011).
• Toyota Industries Corporation announced that its stake in the Company’s share capital increased to 28.46 %
(published on September 15, 2011).
• Alcide Ltd informed that its stake in the Company’s share capital decreased to 21.88 % (published on Sep-
tember 17, 2011).
• Toyota Industries Corporation announced that its stake in the Company’s share capital increased to 50.34 %
(published on November 9, 2011). The date of transfer of the equity securities is subject to fulfillment or
waiver of closing conditions.
• Alcide Ltd informed that its stake in the Company’s share capital decreased to below 3.0 % (published on
November 12, 2011). The date of transfer of the equity securities is subject to fulfillment or waiver of closing
conditions.
• The shareholders group around Geoffrey Scott holding 8.41 % of the Company’s share capital changed its
composition (published on December 8, 2011), now including Max-Ulrich Zellweger, CH-Meggen; Barry
James Mulady, UK-East Sussex; Geoffrey Scott, CH-Erlenbach; Thomas Nasiou, CH-Uster; Hossein Ghorashi,
US-Knoxville Tennessee; Naiming Wei, CN-Shanghai; Richard Furter, CH-Zug; Rafael Storz, CH-Kreuzlin-
gen; Deniz Bütüner, CH-Fällanden; Harold R. Hoke, US-Charleston, South Carolina; Renato Murk, CH-Egg;
Reine Wasner, S-Stockholm.
Corporate Governance 25
The following major shareholders owned more than 3.0 % of the share capital of Uster Technologies Ltd as
of December 31, 2011:
• Toyota Industries Corporation 50.3 % 1)
• Board and Management Group 2) 8.4 %
1) The date of transfer of the equity securities is subject to fulfillment or waiver of closing conditions, not
fulfilled at the balance sheet date.2) Part of Board and Management formed a Group for purchase and sale of shares
1.3 Cross-Shareholdings
Uster Technologies Ltd does not have any cross-shareholdings with other companies.
2 Capital Structure
2.1 Ordinary Share Capital
The ordinary share capital of Uster Technologies Ltd as of December 31, 2011, amounted to CHF 79,524,000
and was fully paid up. It consisted of 8,460,000 registered shares with a nominal value of CHF 9.40 each.
The authorized share capital of Uster Technologies Ltd as of December 31, 2011, amounted to CHF 17,860,000
(details see below, 2.2).
The conditional share capital of Uster Technologies Ltd as of December 31, 2011, amounted to CHF 7,708,000
(details see below, 2.2).
2.2 Authorized and Conditional Share Capital
As of December 31, 2011, Uster Technologies Ltd had an authorized share capital of CHF 17,860,000. Accord-
ing to the articles of association of Uster Technologies Ltd, the Board of Directors is authorized, at any time
until March 30, 2012, to increase the share capital by an amount not to exceed CHF 17,860,000 through the
issuance of up to 1,900,000 fully paid registered shares with a nominal value of CHF 9.40 each. An increase
in partial amounts is permitted.
The Board of Directors determines the issue price, the type of payment, the date of issue of new shares, the
conditions for the exercise of pre-emptive rights and the beginning date for the dividend entitlement. In this
regard, the Board of Directors may issue new shares by means of a firm underwriting through a banking
institution, a syndicate or another third party with a subsequent offer of these shares to the current share-
holders (unless the pre-emptive rights of current shareholders are excluded). The Board of Directors may
permit pre-emptive rights that have not been exercised to expire or it may place these rights and/or shares
as to which pre-emptive rights have been granted but not exercised, at market conditions or use them for
other purposes in the interest of Uster Technologies Ltd.
The subscription and acquisition of the new shares, as well as each subsequent transfer of the shares, shall
be subject to the restrictions mentioned under “2.6 Limitations on Transferability and Nominee Registra-
tions”. The Board of Directors is authorized to restrict or exclude the pre-emptive rights of shareholders and
allocate such rights to third parties if the shares are to be used (a) for the acquisition of enterprises, parts of
an enterprise or participations, or for new investments, or, in case of a share placement, for the financing
or refinancing of such transactions; or (b) for the purpose of the participation of strategic partners (includ-
ing in the event of a public tender offer) or for the purpose of an expansion of the shareholder constituency
in certain investor markets or in connection with the listing of the shares at domestic or foreign exchanges,
including for the purpose of the delivery of shares to the involved banks in case of the over-allotment option.
26 Uster Technologies Ltd | Annual Report 2011
As of December 31, 2011, Uster Technologies Ltd had a conditional share capital, pursuant to which the
share capital may be increased by a maximum aggregate amount of CHF 7,708,000 through the issuance
of a maximum of 820,000 fully paid registered shares with a nominal value of CHF 9.40 each by the
exercise of option rights which the employees, the Management or Directors of Uster Technologies Ltd
or another Group company may be granted in the future pursuant to one or several regulations of the
Board of Directors. The pre-emptive rights of the shareholders are excluded.
The acquisition of registered shares through the exercise of option rights and the subsequent transfer
of the registered shares are subject to the transfer restrictions mentioned under “2.6 Limitations on
Transferability and Nominee Registrations”.
2.3 Changes in Share Capital
March 29, 2011 The conditional share capital was increased from CHF 3,008,000 to CHF 7,708,000 by
amending article 3b of the articles of association.
March 30, 2010 New authorized share capital was created in the amount of CHF 17,860,000 including
the authorization to increase the share capital until March 30, 2012 by amending article
3a of the articles of association.
November 2, 2009 The ordinary share capital was increased from CHF 61,664,000 to CHF 79,524,000 by
the issuance of 1,900,000 registered shares with a nominal value of CHF 9.40 each. The
new shares were issued from the Company’s authorized share capital to Toyota Indus-
tries Corporation at a price of CHF 23.09 per share, representing a premium of 10 % over
the volume-weighted average share price of the last 30 trading days prior to the capital
increase.
March 31, 2009 New authorized share capital was created in the amount of CHF 17,860,000 with the
authorization to increase the share capital until March 31, 2011 by amending article 3a
of the articles of association.
2.4 Shares and Participation Certificates
2.4.1 Shares
Each of Uster Technologies Ltd’s 8,460,000 registered shares has a nominal value of CHF 9.40 and each share
recorded and registered under a shareholder’s name in the share register of Uster Technologies Ltd is entitled
to one vote. There are no preferential rights for individual shareholders and all shareholders are entitled to
equal dividends.
On January 1, 2009, the new Swiss Federal Act on Intermediated Securities (FISA) became effective. Uster
Technologies Ltd created the uncertificated securities book (Wertrechtebuch) pursuant to Art. 973c of the
Swiss Code of Obligations. In addition the shares of Uster Technologies Ltd are registered with the SIX
SIS AG and qualify as intermediated securities in accordance with the FISA.
Corporate Governance 27
2.4.2 Participation Certificates
Uster Technologies Ltd has not issued any participation certificates.
2.5 Profit Sharing Certificates
Uster Technologies Ltd has not issued any profit sharing certificates.
2.6 Limitations on Transferability and Nominee Registrations
2.6.1 Limitations on Transferability
Acquirers of registered shares will be recorded in the share register as shareholders with the right to vote,
provided they explicitly declare to have acquired these registered shares in their own name and for their own
account.
2.6.2. Nominee Registrations
Nominees are persons or entities who do not expressly declare in the application form to hold the shares for their
own account and with whom the Board of Directors has entered into the according contractual agreements.
According to the articles of association, the Board of Directors may record nominees in the share register
with voting rights for shares up to a maximum of 3.0 % of the outstanding nominal share capital. Shares held
by a nominee that exceed this limit are only registered in the share register with voting rights if such nomi-
nee declares in writing to disclose name, address and shareholding of any person or legal entity for whose
account it is holding 1.0 % or more of the outstanding share capital.
Legal entities and associations or other partnerships or communities of joint owners that are linked by
capital, voting power, management or in other manner as well as all persons, legal entities and partnerships
that are acting in concert with a view to circumvent the restrictions on nominee registration (especially as
a syndicate) are deemed to be one nominee.
2.7. Convertible Bonds and Warrants/Options
Uster Technologies Ltd has not issued any convertible bonds, warrants or options. Uster Technologies Ltd
has a Restricted Stock Unit (RSU) plan, the essentials of which are set forth under “5 Compensation, Share-
holdings and Loans”.
28 Uster Technologies Ltd | Annual Report 2011
Board of Directors
Members of the Board of Directors
Max-Ulrich Zellweger
1941, Swiss
Chairman
Elected in 2003
Elected until 2013
Barry James Mulady
1947, British
Member
Elected in 2003
Elected until 2012
Corporate Governance 29
3 Board of Directors
3.1 Members of the Board of Directors
The following information sets forth the name, year of birth, function, election and directorship term of
each Member of the Board of Directors, all of whom except for Geoffrey Scott are non-executive directors,
followed by a short description of each Member’s business experience, education and activities.
Max-Ulrich Zellweger, Chairman of the Board of Directors
Max-Ulrich Zellweger has been a Member of the Board of Directors of Uster Technologies Ltd since 2003 and
is elected until 2013. Between 1987 and 1992 he was Area Manager Asia Pacific of Schindler Elevators Co. and
in this function responsible for the subsidiaries and joint ventures of Schindler in China, Japan, India, Hong
Kong and other Asian countries. He is now Managing Partner of Pacific Consult Ltd, a Zurich and Shanghai
based business consultant specialized on business development in Asia, established in 1992 by Max-Ulrich
Zellweger with some partners. He frequently lectures on Asia-related topics at universities and Executive
MBA courses. Furthermore, he is Chairman of the Board of Directors of Fr. Sauter Holding AG and a Member
of the Board of Directors of Fr. Sauter AG, Bartec GmbH (Germany) and Pacific Consult Ltd. Max-Ulrich
Zellweger holds a Master’s degree in Mechanical Engineering of the Swiss Institute of Technology (ETH) in
Zurich. He was born in 1941 and is a Swiss citizen.
Dr. Barry James Mulady, Member of the Board of Directors
Barry James Mulady has been a Member of the Board of Directors of Uster Technologies Ltd since 2003 and is
elected until 2012. He has been Chairman of PageOne Communications Ltd, London, England, since 2000 and
is Chairman of ipTEST Ltd, Guildford, England. From 2000 to 2006, he served as a non-executive Director of
Tellermate plc, Newport, Wales and Sensima Ltd, London. From 1996 to 1999 he was CEO of Airtech plc,
Aylesbury, England. Prior to that he served as President of Fisons Instruments Europe and CEO of VG Instru-
ments plc. He has broad experience in general management, mergers and acquisitions and business develop-
ment. Barry James Mulady earned a First Class Honours Degree in Physics and a PhD in Nuclear Magnetic
Resonance from the University of Nottingham. He was born in 1947 and is a British citizen.
30 Uster Technologies Ltd | Annual Report 2011
Akira Onishi
1958, Japanese
Member
Elected in 2010
Elected until 2013
Geoffrey Scott
1954, British
Member
Elected in 2003
Elected until 2013
Board of Directors
Members of the Board of Directors
Corporate Governance 31
Akira Onishi, Member of the Board of Directors
Akira Onishi has been elected a Member of the Board of Directors of Uster Technologies Ltd in 2010 for a
period of three years until 2013 and acts as representative of Toyota Industries Corporation. He started his
carrier as sales and marketing manager in the textile machinery division of Toyota Industries Corporation
in 1981. Later he was active in various management functions mainly in Corporate Planning. Akira Onishi
currently holds the positions of Senior Managing Director, Member of the Board, Corporate Planning and
Head of Textile Machinery Business Unit. Akira Onishi earned a degree in law from Nagoya University, Japan.
He was born in 1958 and is a Japanese citizen.
Dr. Geoffrey Scott, Member of the Board of Directors and Chief Executive Officer
Geoffrey Scott has been a Member of the Board of Directors and CEO of Uster Technologies Ltd since 2003
and is elected until 2013. He was Chief Executive Officer of the Zellweger Uster Division of Zellweger Luwa,
Uster, Switzerland, from 1999 to 2003. Prior to that he held Senior Management positions at Kevex Instru-
ments, Fisons plc (Scientific Instruments Division) and Beckman Instruments. He has broad experience of
strategy and business development, sales, marketing and after-sales, product development and general
management. He was a Member of the Board of Directors of Maillefer SA until January 12, 2011. Geoffrey Scott
earned a BSc Honours degree in Biochemistry from the University of Liverpool, and a PhD in Biochemistry
from the University of Nottingham. He was born in 1954 and is a British citizen.
During the reporting period, Harald Rönn, member of the Board of Directors of the Uster Technologies Ltd
since 2006 and representative of the private equity fund Alpha, resigned from the Board as per June 30, 2011
to prevent any potential conflicts of interest following Alpha’s announcement to acquire the parent com-
pany of a competitor of Uster Technologies Ltd.
3.2 Independence of the Board of Directors
None of the non-executive Members of the Board of Directors has been a Member of the Executive Commit-
tee of Uster Technologies Ltd or its subsidiaries during the past three years and there are no significant
business connections between Uster Technologies Ltd and its subsidiaries and the non-executive Members
of the Board of Directors.
In his function of a Managing Partner of Pacific Consult Ltd Max-Ulrich Zellweger advises the Company on
certain business issues related to China. Also, Barry James Mulady sometimes delivers consulting services
to the Company. However, the scope of these consultancy services is not significant.
The Members of the Board of Directors do not have any activities and functions outside Uster Technologies
Ltd that would compromise their independence.
32 Uster Technologies Ltd | Annual Report 2011
3.3 Elections and Terms of Office
The articles of association of Uster Technologies Ltd provide that the Board of Directors may consist of a
minimum of three Members and a maximum of nine Members. Members of the Board of Directors are ap-
pointed and removed exclusively by shareholders’ resolution. The elections are held individually. Their
maximum term of office is three years, re-election is allowed.
3.4 Internal Organization
3.4.1 Duties and Operating Principles of the Board of Directors
The Board of Directors is entrusted with the ultimate direction of Uster Technologies Ltd and the supervision
of the Executive Committee. The Board of Directors’ non-transferable and irrevocable duties include the
following:
• The ultimate direction of the Company and the Group and the issuance of the necessary directives;
• The determination of the organization of the Company, including the adoption and revision of the or-
ganizational rules;
• The organization of the accounting system, the financial control as well as the financial planning;
• The appointment and dismissal of the persons entrusted with the management of the Company as well as
the determination of the signatory power;
• The ultimate supervision of the persons entrusted with the management of the Company, specifically, in
view of their compliance with the law, the articles of association, organizational rules and directives;
• The preparation of the annual report and the Shareholders’ meeting as well as the implementation of the
resolutions adopted by the meeting of Shareholders;
• The passing of resolutions regarding the supplementary contribution for shares not fully paid up and of
the corresponding amendments to the articles of incorporation;
• The passing of resolutions concerning an increase in share capital to the extent that such power is vested
in the Board of Directors and of resolutions concerning the confirmation of capital increases and cor-
responding amendments to the articles of incorporation as well as making the required report on the
capital increase;
• The non-delegable and inalienable duties and powers of the Board of Directors pursuant to the Merger Act
and any other law;
• The notification of the judge in case of over-indebtedness of the Company;
• The adoption of, and any amendments or modifications to, any equity incentive plan, stock option agree-
ment, restricted stock purchase agreement, etc.;
• The decision regarding entering into any financing arrangement in excess of CHF 10.0 million including
loan agreements, credit lines, letters of credit or capitalized leases;
• The issuance of convertible debentures with option rights or other financial market instruments;
• The approval of the business strategy and the approval and adoption of the budget of the Company;
• The approval of any transaction exceeding the amount of CHF 10.0 million which is not in accordance with
the budget.
Corporate Governance 33
According to the current organizational rules enacted by the Board of Directors, the Board of Directors meets
at the invitation of the Chairman, or in the Chairman’s absence, the Vice-Chairman or the Secretary on their
behalf. In addition, any other Member of the Board of Directors can by stating the reasons and the items to
be placed on the agenda, request the Chairman in writing, to convene a meeting. The Board of Directors meets
regularly and as often as the Company’s business requires a meeting but in any event at least six times per
calendar year. Resolutions of the Board of Directors are passed by way of simple majority of the vote cast. In
the case of a tie the Chairman has a casting vote. To pass a resolution validly, the majority of the Members of
the Board of Directors have to attend the meeting.
The Chairman, after consultation with the Chief Executive Officer, determines the agenda for the Board
meetings. Any Member of the Board of Directors may request the inclusion of further items of business in
the agenda. All Members of the Board receive written information on the agenda items before the meeting
in order to be well prepared. The Board of Directors consults external experts where necessary when discuss-
ing specific topics.
In 2011 the Board of Directors held the following meetings:
Number of meetings: 7
Average meeting time (hours): 3
Attendance of Members of the Board of Directors (Meetings):
Max-Ulrich Zellweger 7
Barry James Mulady 7
Akira Onishi 5
Harald Rönn 1) 3
Geoffrey Scott 7
1) Stepped down from his function as of June 30, 2011
34 Uster Technologies Ltd | Annual Report 2011
3.4.2 Committees of the Board of Directors
The Board of Directors has established two committees to further strengthen the corporate governance
structure. The Members of these committees are appointed, as a rule, for the entire duration of their mandate
as Director and are re-eligible. The committees constitute themselves each year at the first meeting after the
annual meeting of shareholders. In discharging their responsibilities the committees have unrestricted ac-
cess to the Company’s and the Management’s books and records.
Audit Committee
According to the Board regulations, the Audit Committee must be composed of two non-executive and in-
dependent Directors. It currently consists of Max-Ulrich Zellweger and Barry James Mulady and meets as
often as necessary. Usually there will be at least two meetings a year, one for the review of the budget and
one for the review of the year-end closing. Furthermore, the audit scope, the audit plan and the audit focus
points for the year-end closing are presented in such meetings. The audit committee asks the auditors to
present their findings of the year-end closing. Other audit findings either by an external consultant or by
the internal audit team are presented on a case by case basis.
In 2011 the Audit Committee held the following meetings:
Number of meetings: 2
Average meeting time (hours): 1
Attendance of Members of the Audit Committee (Meetings):
Max-Ulrich Zellweger 2
Barry James Mulady 1) 1
Harald Rönn 2) 1
1) Elected to the Committee as of December 15, 20112) Resigned from the Board as of June 30, 2011
Corporate Governance 35
The Audit Committee assists the Board of Directors in fulfilling its duties of supervision of the Executive
Committee. It has the following powers and duties:
• To review and assess the effectiveness of the statutory auditors, in particular their independence from the
Company;
• To review and assess the scope and plan of the audit, the examination process and the results of the audit
and to examine whether the recommendations issued by the auditors have been implemented;
• To review the auditors’ reports and to discuss their contents with the auditors and with the Executive Com-
mittee;
• To assess the risk assessment established by the Executive Committee and the proposed measures to reduce
risks;
• To assess the state of compliance with norms within the Company;
• To review in cooperation with the auditors, the CEO and the CFO whether the accounting principles and
the financial control mechanism of the Company and its subsidiaries are appropriate in view of the size
and complexity of the Group;
• To review the annual and interim statutory and consolidated financial statements intended for publication.
It should discuss these with the CEO, the CFO and with the head of the external audit;
• The Audit Committee regularly reports to the Board of Directors on its findings and proposes appropriate
actions.
Nomination and Compensation Committee
According to the Board Regulations, the Nomination and Compensation Committee must be composed of
non-executive and independent Directors. It currently consists of Max-Ulrich Zellweger and Barry James
Mulady and meets as often as necessary.
In 2011 the Nomination and Compensation Committee held the following meetings:
Number of meetings: 2
Average meeting time (hours): 1
Attendance of Members of the Compensation Committee (Meetings):
Max-Ulrich Zellweger 2
Barry James Mulady 2
Harald Rönn 1) 1
1) Resigned from the Board as of June 30, 2011
36 Uster Technologies Ltd | Annual Report 2011
The Nomination and Compensation Committee assists the Board of Directors in fulfilling its duties of su-
pervision of the Executive Committee. It has the following powers and duties:
• To assure the long-term planning of appropriate appointments to the position of the CEO and to the Board
of Directors;
• To nominate candidates to fill the vacancies on the Board of Directors or the position of the CEO;
• To make recommendations on the composition and balance of the Board of Directors;
• To review and assess on a regular basis the remuneration system of the Company and the Group (including
the management incentive plans) and to make a proposal to the Board of Directors;
• To recommend the terms of employment, in particular the remuneration package of the CEO, and to make
proposals in relation to the remuneration of the Members of the Board of Directors;
• To recommend upon proposal of the CEO the terms of employment, in particular the remuneration pack-
age, of employees reporting directly to the CEO as well as review matters related to the compensation of
other top managers as well as the general employee compensation and human resource practices of the
Company;
• To make recommendations on the grant of options or other securities under any management incentive
plan of the Company.
The Nomination and Compensation Committee regularly reports to the Board of Directors on its findings
and proposes appropriate actions.
3.5 Areas of Responsibilities
In accordance with the law, the articles of incorporation and the organizational rules the Board of Directors
has delegated the Company’s operational management to Geoffrey Scott, the CEO of Uster Technologies Ltd.
Together with the Executive Committee he is responsible for the overall management of the Uster Group.
The CEO has all the powers and duties that are not explicitly reserved to the Board of Directors or a Board
Committee as mentioned above. In particular, the CEO has the following powers and duties:
• The provision of all information and documents necessary to the Board of Directors;
• The implementation of the resolutions passed by the Board of Directors;
• The organization, management and control of the day-to-day business of the Company;
• The proposal to the Board of Directors for the approval of transactions to be resolved by the Board of
Directors;
• The proposal to the Board of Directors for the appointment and dismissal of Members of the Executive
Committee;
• The organization of the Executive Committee and the preparation, calling and presiding the meetings of
the Executive Committee.
Corporate Governance 37
3.6 Information and Control Mechanisms
Board of Directors
The Board of Directors recognizes the importance of receiving sufficient information from the Executive
Committee to fulfill its supervisory duty and to make the decisions that are reserved to the Board of Direc-
tors. It has the following means to monitor the responsibilities it has delegated to the Executive Committee:
• The CEO of the Group is a Member of the Board of Directors and informs the Board in every meeting about
the current development of the business. Additionally, the CFO serves as the secretary of the Board and
also participates in every meeting. Other Members of the Executive Committee are invited to attend Board
meetings to report on their areas of responsibility as deemed necessary by the Board.
• The minutes of the Executive Committee Meetings are made available to the Chairman of the Board.
• Informal meetings are held as required between Board Members and the CEO.
• The Board of Directors receives on a monthly basis the consolidated income statement, balance sheet and
cash flow statement of the Uster Group together with a detailed comment on the course of the business.
The Board of Directors does not have direct access to the Management Information System of the Com-
pany, but is informed about the content and is entitled to request any kind of information at any time.
• Risk management and monitoring procedures are evaluated at regular intervals by the Board of Directors.
Risk management is part of the management process which is defined within the management handbook.
All risks / groups of risks are assigned to the process owners of the business processes containing the spe-
cific risk. Strategic risks are directly assigned to the Executive Management Team. The process owners
supervise the risks / group of risks and propose process changes if the risks take unexpected developments.
The process changes are approved by the Executive Management Team. The risk management process is
reviewed at least once a year by the Board of Directors.
Board Committees
The Board Committees, especially the Audit Committee, invite external consultants to review the business
and better understand the laws and policies impacting the Company. It also is in regular contact with the
internal audit team following its work and informing itself. In addition the CEO, the CFO and the represen-
tative of the external auditors will be invited to the meetings of the Audit Committee.
38 Uster Technologies Ltd | Annual Report 2011
Executive Committee
Members of the Executive Committee
Geoffrey Scott
1954, British
Chief Executive Officer
Member since 2003
Peter Huber
1966, Swiss
Chief Financial Officer
Member since 2012
Corporate Governance 39
4 Executive Committee
4.1 Members of the Executive Committee
The following information sets forth the name, year of birth, nationality and function of each Member of
the Executive Committee, followed by a short description of each Member’s business experience, education
and activities.
Dr. Geoffrey Scott, Member of the Board of Directors and Chief Executive Officer
Geoffrey Scott has been a Member of the Board of Directors and CEO of Uster Technologies Ltd since 2003
and is elected until 2013. He was Chief Executive Officer of the Zellweger Uster Division of Zellweger Luwa,
Uster, Switzerland, from 1999 to 2003. Prior to that he held Senior Management positions at Kevex Instru-
ments, Fisons plc (Scientific Instruments Division) and Beckman Instruments. He has broad experience of
strategy and business development, sales, marketing and after-sales, product development and general
management. He was a Member of the Board of Directors of Maillefer SA until January 12, 2011. Geoffrey Scott
earned a BSc Honours degree in Biochemistry from the University of Liverpool, and a PhD in Biochemistry
from the University of Nottingham. He was born in 1954 and is a British citizen.
Thomas F. Dressendörfer, Chief Financial Officer, Finance and Support (until October 31, 2011)
Thomas F. Dressendörfer was appointed to the CFO position of Uster Technologies Ltd as of October 1, 2008.
He left the Company as of October 31, 2011 to pursue a new professional challenge. Thomas Dressendörfer
took responsibility to lead the Finance and Support Team in Uster, including IT, and reported as member of
the Executive Management Committee directly to the CEO. Prior to his tasks at Uster Technologies Ltd
Thomas F. Dressendörfer worked with Randstad, The Nielsen Company and Procter & Gamble, where he held
various key senior finance positions. He has extensive experience of leading high performing Finance teams
as well as experience of working with Finance groups internationally. Thomas F. Dressendörfer holds a
Master’s Degree in Business Administration and Economics from the University of Erlangen-Nuremberg
in Germany. He was born in 1958 and is a German citizen.
Peter Huber, Chief Financial Officer, Finance and Support (as of January 1, 2012)
Peter Huber has been appointed to the CFO position of Uster Technologies Ltd as of January 1, 2012. He takes
responsibility to lead the Finance and Support Team in Uster, including IT, and reports as member of the
Executive Management Committee directly to the CEO. Prior to joining the Company, he worked for Pago
International Ltd, a full-range supplier of labels and labeling technology, where he acted as Chief Financial
Officer and a member of the Group Executive Board. Peter Huber also held CFO positions with the Keystone
Group and with Landolt Group, a leading manufacturer of non-woven textile products. He started his profes-
sional career with KPMG Financial Advisory Services and UBS Commercial Banking. Peter Huber graduated
in Business Administration at the University of Zurich and holds an Executive Master in Corporate Finance
from Lucerne University. He was born in 1966 and is a Swiss citizen.
40 Uster Technologies Ltd | Annual Report 2011
Naiming Wei
1962, German
Head of Asian Operations
Member since 2006
Executive Committee
Members of the Executive Committee
Hossein Ghorashi
1945, American
Head of U.S. Operations
Member since 2003
Thomas Nasiou
1970, Greek
Head of Textile Technology
Member since 2011
Corporate Governance 41
Hossein Ghorashi, Head of U.S. Operations
Hossein Ghorashi has been Head of U.S. Operations since 2003. From 1990 through 2002 he held the positions
of Senior Vice President of R&D and Head of Zellweger Uster Inc. He was with Special Instruments Labora-
tory from 1969 through 1989 and was Vice President of R&D for the last 10 years. He holds a BS and a MS in
Electrical Engineering from the University of Tennessee, Knoxville TN, United States. He is a co-inventor of
18 fiber testing patents, author of numerous papers and presents the Company’s latest innovations in im-
portant international conferences. He is known and referred to as a cotton fiber testing expert worldwide.
Hossein Ghorashi was born in 1945 and is an American citizen.
Dr. Naiming Wei, Head of Asian Operations
Naiming Wei has been a Member of the Management and Head of Asian Operations of Uster Technologies
Ltd since 2006. From 2000 to 2005 he was General Manager at Shanghai Sachs Huizhong Shock Absorber Co.
Ltd, a joint venture company between the German automotive supplier ZF-Sachs Ltd and Shanghai Automo-
tive Industry Corporation. Prior to that, Naiming Wei worked as management consultant at Management
Engineers GmbH for large and middle size multinational clients in Germany, in the UK and in Switzerland.
From 1993 to 1997 he was Sales and Marketing Manager and Purchasing Manager at Siemens Ltd, Business
Division Private Communication Systems. Naiming Wei holds a Master’s degree (Dipl.-Ing.) and a PhD degree
(Dr.-Ing.) in Electrical Engineering from the University Erlangen-Nuremberg in Germany. He was born in
1962 and is a German citizen.
Richard Furter, Head of Textile Technology (until May 31, 2011)
Richard Furter was Head of Textile Technology of Uster Technologies Ltd since 2003. In spring 2011 he ex-
pressed his desire to take retirement at the end of 2011. Prior to his tasks at Uster Technologies Ltd he worked
for Zellweger Uster Ltd since 1967 where he was an electronic engineer in R&D and was particularly involved
in sensor technology and signal processing. In this role he filed various patents. Richard Furter graduated
as an electronic engineer (currently Lucerne University of Applied Sciences and Arts). He was born in 1943
and is a Swiss citizen.
Thomas Nasiou, Head of Textile Technology (as of June 1, 2011)
Thomas Nasiou has been appointed to the position as Head of Textile Technology of Uster Technologies Ltd
as of June 1, 2011. He joined Uster Technologies Ltd as a Textile Technologist in 2006 and held positions in
Product Management and Head of Marketing in China. He has extensive experience within the textile indus-
try, holding key senior management positions, including Mill Manager and Quality Control Manager at
Selected Textiles in Greece, as well as positions in R&D and Technical Support at Viochrom Dyestuffs SA in
Greece. Thomas Nasiou holds a Textile Technologist degree from the Technological Institute of Athens in
Greece and a Master of Business Administration (MBA) from the Hellenic Management Association (H.M.A.).
He was born in 1970 and is Greek citizen.
42 Uster Technologies Ltd | Annual Report 2011
Executive Committee
Members of the Executive Committee
Rafael Storz
1967, German
Head of Research and
Innovation
Member since 2006
Reine Wasner
1970, Swedish
Head of Marketing and
Business Development
Member since 2011
Corporate Governance 43
Dr. Rafael Storz, Head of Research and Innovation
Rafael Storz has been a Member of the Management since 2006. From 2001 to 2006 he was a Member of the
Management and Head of R&D of Leica Microsystems CMS GmbH, Wetzlar, Germany. From 1998 to 2001 he
was a project manager and deputy head of the R&D department at Leica Microsystems Heidelberg GmbH,
Germany. He is experienced within strategy and business development and product development. He is a
(co-)inventor of 72 patents in the field of measurement equipment and analysis tools. Rafael Storz earned a
PhD in Physics from the University of Konstanz, Germany. He was born in 1967 and is a German citizen.
Reine Wasner, Head of Marketing and Business Development
Reine Wasner has been appointed to the position as Vice-President of Marketing and Business Development
as of January 1, 2011. Prior to joining the company, he worked for more than ten years in management con-
sulting including Booz Allen Hamilton, Arthur D. Little and A. T. Kearney. He has experience in the areas of
strategy development, market and business development and innovation management across a wide range
of industries, including projects for Uster Technologies Ltd. Reine Wasner holds a Master of Science in
Mechanical Engineering from the Technical University of Lund, a Master of Business Administration from
the University of Lund as well as a three year research degree from the University of Linköping (all in Sweden)
in collaboration with MIT in Boston (USA). He was born in 1970 and is a Swedish citizen.
44 Uster Technologies Ltd | Annual Report 2011
Harold R. Hoke
1954, American
Head of Sales and Service
Member since 2003
Executive Committee
Members of the Executive Committee
Renato Murk
1956, Swiss
Head of Order Fulfillment
Member since 2003
Corporate Governance 45
Harold R. Hoke Jr., Head of Sales and Service
Harold Hoke has been Head of Sales and Service of Uster Technologies Ltd since 2003. He rejoined Uster
Technologies Ltd in 2002 after almost two years as CEO of Savio America. Harold Hoke originally joined
Zellweger Uster Ltd in 1980 in the U.S. operation. In 1996 he was based in the Company’s Swiss headquarters
and was initially responsible for Sales and Service Asia, later responsible for the companies’ worldwide sales
and service organization including all small subsidiary companies. Harold Hoke has experience in sales,
marketing, service, business development, production management and strategy development. Harold Hoke
holds a BS from Clemson University. He was born in 1954 and is an American citizen.
Renato Murk, Head of Order Fulfillment
Renato Murk has been Head of Order Fulfillment of Uster Technologies Ltd since 2003, a position which
includes the worldwide responsibility for the production processes and supply chain management. From
1999 to 2003 he was responsible for production and logistics of the Zellweger Uster Division of Zellweger
Luwa Ltd. From 1996 to 1999, he was a Manager of Product Assembly Lines at Zellweger Uster. Renato Murk
holds a Master of Industrial Engineering degree from the Swiss Federal Institute of Technology (ETH) with
the majors Process Engineering and Business Administration. Besides significant experience in general and
production management he has executed several efficiency and cost-improving programs as a senior con-
sultant in a Swiss-based management consultancy. He was born in 1956 and is a Swiss citizen.
4.2 Other Activities and Vested Interests
There are no further activities of vested interests of the Members of the Executive Management except the
ones mentioned above.
4.3 Management Contracts
The Board of Directors has not delegated any management tasks to third parties outside the Company.
46 Uster Technologies Ltd | Annual Report 2011
5 Compensation, Shareholdings and Loans
5.1 Content and Method of Determining the Compensation and the Share-Ownership Programs
5.1.1 Compensation Design
The compensation policy of Uster Technologies Ltd is designed to provide simple and clearly structured
salary systems that ensure fair remuneration and are transparent to employees. Salary levels are geared
relative to salaries in the local markets and are reviewed at regular intervals using different remuneration
studies available on the market. Individual compensation is determined by the specifications of the position,
competencies and experience, performance and the Group’s business success. Where possible, results- and
performance-driven compensation systems are employed that include a results-related variable component.
5.1.2 Board of Directors
The remuneration of the Members of the Board of Directors consists of an equal payment in cash for the
ordinary Board Members. The remuneration for the Chairman of the Board of Directors is determined by
taking into account his respective responsibility, experience and the time which he invests in his activity as
Chairman. Extraordinary assignments or work which a Director accomplishes outside of his activity as a
Director is specifically remunerated. Such remuneration has to be approved by the Board of Directors. In
addition, the Directors are reimbursed all reasonable cash expenses properly incurred by them in the dis-
charge of their duties, including their reasonable expenses of traveling to and from the meetings of the Board
of Directors, committee meetings and Shareholders’ meetings. Board Members may also participate in the
Uster Group RSU plan which is detailed below.
5.1.3 Executive Committee
The Members of the Executive Committee are remunerated according to the principle of flexible, performance-
related compensation. Their remuneration consists of a basic salary and a performance-related component
in the context of the bonus plan. The performance related compensation part amounts to an average of 50 %
of the basic salary for attainment of target; further payment is made for overachievement against target. The
variable component is directly linked to the primary drivers of business performance. It is based on the
yearly gross sales and the operating earnings achieved by the Group (EBITA) as well as the individual goals
amounting to a maximum of 10 % of total performance related compensation. All the components mentioned
above are cash compensations which are paid out immediately and are not subject to forfeiture clauses. Ad-
ditional benefits for the Members of the Executive Committee include a car and participation in the below-
mentioned RSU plan.
Corporate Governance 47
5.1.4 Share Ownership Program
In April 2010, the Board of Directors adopted a Restricted Stock Unit (RSU) plan. The RSU plan has been
designed to provide an increased incentive to contribute to the future success of the Company, to align
remuneration with the creation of shareholder value, to promote a team-base culture throughout the
organization and to increase the ability of Uster Group to attract and retain individuals with exceptional
skills. The Nomination and Compensation Committee will select the employees eligible for the RSU plan in
its own discretion, but upon proposal by the CEO. The selected employees will be awarded a fixed number
of Restricted Stock Units (RSU Awards) to purchase registered shares of the Company. The total number of
RSU Awards awarded at any one time is left to the sole discretion of the Nomination and Compensation
Committee, which will base its decision on the recommendation of the CEO.
According to the RSU plan, the RSU Awards will vest on the third anniversary from the date of grant of the
RSU Award, provided that neither the employment agreement has been terminated nor any forfeiture event
has occurred. There are no other share-ownership programs or option plans with regard to the compensation
of the Board of Directors and the Executive Committee. Usually Uster Technologies Ltd does not adjust
salaries during the year.
5.1.5 Compensation Governance
With respect to the compensation the Nomination and Compensation Committee has the following respon-
sibilities:
• To review and assess on a regular basis the remuneration system of the Company and the Group including
the incentive plans for the Executive Committee and to make a proposal to the Board of Directors thereto;
• To make recommendations with respect to the remuneration package of the CEO and the Directors;
• To recommend upon proposal of the CEO the remuneration package of employees reporting directly to
the CEO;
• To make recommendations on the grant of options or other securities under any management incentive
plan. Based on these recommendations the Board of Directors approves the remuneration of the Members
of the Board of Directors and the Members of the Executive Committee.
The Nomination and Compensation Committee generally meets during the fourth quarter to discuss the
remuneration package of the Board Members and the Members of the Executive Committee for the following
year. Information from different remuneration studies available on the market is made available to the Mem-
bers of the Nomination and Compensation Committee and serves as a basis for the discussion of the remu-
neration during the meeting. Examples of such studies include surveys from Swissmem and Landolt & Mächler
in Switzerland, Hewitt in China and the Department of Labor in the USA. The CEO is partially present at the
meeting but he has to leave when his remuneration is discussed. After the final decision on the remuneration
of the Board Members and the Members of the Executive Committee by the Board of Directors the salary
changes are signed by a Member of the Board of Directors.
5.2 Compensation of the Members of the Board of Directors and the Executive Committee
Information on the compensation of the Board of Directors and the Executive Committee for the year ending
December 31, 2011, are presented in the note 11 of the Financial Statements of Uster Technologies Ltd.
48 Uster Technologies Ltd | Annual Report 2011
6 Shareholders’ Participation
6.1 Voting Rights and Representation Restrictions
Details of restrictions on shareholders’ voting rights are given in the section entitled “2.6 Limitations on
Transferability and Nominee Registrations” above.
In a Shareholders’ meeting each share recorded as a share with the right to vote in the share register entitles
its owner to one vote. By means of a written proxy each shareholder may have his shares represented in a
Shareholders’ meeting by a third person who need not be a shareholder. Shareholders who are recorded in
the share register with the right to vote at a certain date appointed by the Board of Directors are entitled to
participate in the Shareholders’ meeting and to exercise the right to vote.
No exceptions to these rules were granted by the Board of Directors in the year under review.
6.2 Statutory Quorums
Unless mandatory statutory provisions provide otherwise, the Shareholders’ meeting passes its resolutions
and performs elections with the absolute majority of the votes represented at the meeting.
If an election cannot be completed upon the first ballot and if there is more than one candidate, the Chairman
shall direct a second ballot at which the relative majority shall decide.
6.3 Convocation of the Shareholders’ Meeting
The Shareholders’ meeting is called by the Board of Directors or, if necessary, the auditors not less than
20 days before the date of the meeting. Notice of a Shareholders’ meeting is given by means of a single pub-
lication in the Swiss Official Gazette of Commerce. The shareholders registered in the share register
may in addition receive a written notice sent by mail.
An extraordinary Shareholders’ meeting is called whenever the Board of Directors or the auditors consider
it necessary or if a Shareholders’ meeting decides so. The Board of Directors will also call a Shareholders’
meeting if one or more shareholders whose combined holdings represent at least 10.0 % of the share capital
so demand in writing and specify the items and the proposals, in the case of elections the names of the pro-
posed candidates, to be submitted to the meeting.
6.4 Agenda
Shareholders whose individual or combined holdings represent an aggregate nominal value of at least
CHF 1,000,000 or at least 10.0 % of the share capital may demand that an item be included in the agenda. This
right must be exercised in writing at least 60 days before the meeting with indication of the items and the
proposals of the shareholders.
No resolution shall be passed on items for which no proper notice has been given; this prohibition does not
apply to proposals to call an extraordinary Shareholders’ meeting, to initiate a special audit or to elect the
auditors as demanded by a shareholder.
No prior notice is required for proposals concerning items included in the agenda and discussions that do
not result in the adoption of resolutions.
6.5 Inscriptions into the Share Register
After the publication or mailing of the written notice of the Shareholders’ meeting until the day following
the Shareholders’ meeting no recordings in the share register will be made, provided that the Board of
Directors does not appoint a different date.
Corporate Governance 49
7 Changes of Control and Defense Measures
7.1 Obligation to Make an Offer
According to the Federal Act on Stock Exchanges and Securities Trading (SESTA) a shareholder or a group
of shareholders acting in concert acquiring more than 33 1/3 % of the voting rights must submit a takeover
offer to all remaining shareholders. The articles of association of Uster Technologies Ltd do not include any
amendment (i. e. no opting-out or opting-up provision) to this rule.
7.2 Clauses on Changes of Control
Uster Technologies Ltd has a Restricted Stock Unit (RSU) plan, the essentials of which are set forth under
“5 Compensation, Shareholdings and Loans”. The RSU plan sets forth that the RSU awards granted under
the RSU plan vest immediately and may be converted into shares of Uster Technologies Ltd upon the occur-
rence of a change of control. In addition to that, neither the Members of the Board of Directors nor the
Members of the Executive Committee have contracts that provide for benefits upon termination of employ-
ment contracts due to a change of control.
8 Auditors
8.1 Duration of the Mandate and Term of Office of the Lead Auditor
The statutory auditors and Group auditors are elected by the Shareholders’ meeting. The term of office of
the auditors is one year, beginning with the day of their election and ending on the day of the next ordinary
Shareholders’ meeting.
Ernst & Young Ltd, Zurich, have been the auditors of the Group since 2003. They have been the statutory
auditors of Uster Technologies Ltd since its incorporation in November 2006. The auditor-in-charge, Daniel
Zaugg, took up office in 2008.
8.2 Auditing Fees
In the year under review, Ernst & Young Ltd invoiced CHF 0.5 million (2010: CHF 0.5 million) for their audit
services.
8.3 Additional Fees
Ernst & Young Ltd invoiced additional fees in the amount of CHF 0.4 million (2010: CHF 0.1 million) mostly
related to tax consulting.
8.4 Information Tools Pertaining to the External Audit
The Audit Committee monitors on behalf of the Board of Directors the performance and independence of
the external auditors. In addition it reviews the audit result and monitors the implementation of the findings
by the Executive Committee.
The Audit Committee prepares proposals for the appointment or removal of the external auditors for
submission to the Board of Directors, which then nominates the external auditor for election by the Share-
holders’ meeting.
Currently, the Audit Committee is informed on the findings of the audit through the Management Letter
issued by the auditors after the year-end audit.
50 Uster Technologies Ltd | Annual Report 2011
9 Information Policy
Uster Technologies Ltd is committed to an open and clear information policy towards its shareholders as
well as its other stakeholders.
The audited annual as well as unaudited semi-annual reports are available to the shareholders and other
stakeholders. The annual report is provided in printed form and both annual and semi-annual reports are
available on the website under www.uster.com/investors/publications/financial_reports/. Additionally, the
public is informed via the media of material current changes and developments. Events relevant for the share
price are published according to the ad-hoc publicity guidelines of the SIX Swiss Exchange.
Media and analyst conferences are held at least once a year. The press releases are available on the website
under www.uster.com/investors/media_release/2011/ and presentations are available on the website under
www.uster.com/investors/publications/investor_relations_presentations/.
Interested parties can subscribe to the mailing list available under www.uster.com/investors/subscription_
service/ in order to receive ad-hoc publications or other recent information relating to the Company.
Important Dates
Publication of annual results 2011 February 21, 2012
Media and analyst conference February 21, 2012
Last day for inscription into the share register
before the Shareholders’ meeting 2012
April 5, 2012
Shareholders’ meeting 2012 April 12, 2012
Dividend payment April 19, 2012
Semi-annual results 2012 July 17, 2012
Contact for Media, Investors and Analysts
Peter Huber, CFO
Uster Technologies AG
Sonnenbergstrasse 10
CH-8610 Uster
Phone +41 43 366 36 06
Fax +41 43 366 36 54
Email [email protected]
10. Material Changes since the Balance Sheet Date
This note contains all information regarding the period between January 1, 2012 and February 17, 2012,
the date this report was authorized for issue. On November 7, 2011, Toyota Industries Corporation, at
that time holding 28.46 % of the share capital of Uster Technologies Ltd, entered into an agreement to
purchase an additional stake of 1,850,777 shares of Uster Technologies Ltd, corresponding to 21.88 % of
the issued and outstanding shares of Uster Technologies Ltd, from Alcide Limited. On November 8, 2011,
Toyota Industries Corporation made a preliminary announcement of a public tender offer at CHF 38.00
per share for all publicly held registered shares of Uster Technologies Ltd. On February 9, 2012, Toyota
Industries Corporation announced that all required merger control approvals for the closing were ob-
tained and that after the closing of the transaction mentioned above the mandatory public tender offer
to acquire all publicly held Uster shares will be launched with the publication of the offer prospectus
on or about February 29, 2012.
Uster Technologies Ltd | Financial Report 2011
52 Comment on the Consolidated Financial Statements 2011
Comment on the Consolidated Financial Statements
Summary
In the financial year 2011, Uster Technologies Ltd achieved excellent performance levels surpassing the previous
highest sales achieved in 2007 before the combined textile and financial marked crisis. Sales grew by 44.9 % to
CHF 192.5 million. EBITA increased by 63.7 % to CHF 56.6 million and the EBITA margin improved to 29.4 % com-
pared to 26.0 % in the previous year.
Key input factors of this EBITA margin were:
• The strong portfolio of high value-adding products meeting the high demand for quality measurement and
certification products around the world;
• High operational leverage in COGS and operational expenses;
• A flexible business model allowing Uster Technologies Ltd to increase its spending in R&D, Marketing and
Management & Administration projects in short time to turn the profits into value for the organization.
The net result amounts to CHF 36.2 million or 18.8 % of gross sales. Key drivers for this excellent net result were:
• Positive business performance with a strong EBITA;
• Lower finance expenses reflecting the reduced debt.
This excellent result and the strong ability to turn profit into cash generated a cash flow from operating activities
of CHF 54.0 million. This allowed Uster Technologies Ltd to finance necessary capital expenditures, to pay
a dividend of CHF 10.2 million, to reduce debt by CHF 28.0 million and to still increase the cash position by
CHF 7.8 million to CHF 28.8 million in the financial year 2011.
Income Statement
Gross Sales
With gross sales of CHF 192.5 million in 2011 Uster Technologies Ltd exceeded the previous highest sales achieved
in 2007. This represents an increase of 44.9 % compared to the 2010 figure of CHF 132.8 million. This was driven by
the continued strong demand for quality measurement and certification products in all markets – e.g. the new third
generation of USTER® yarn clearers USTER® QUANTUM 3 – meeting the needs of textile producers to maximize the
utilization of highly priced cotton by efficiently manufacturing yarns with optimal and consistent quality levels.
EBITA
EBITA amounted to CHF 56.6 million (2010: CHF 34.6 million). As a percentage of gross sales the EBITA reached
29.4 % (2010: 26.0 %).
Uster Technologies Ltd’s flexible business model allowed the Company to quickly respond to the positive market
developments in all areas of the business. In the production area the increased market demand could be served
without significant impact on the fixed cost structure leading to reduced COGS due to economies of scale. High
investments in R&D of CHF 18.2 million were released to support future market leadership by a complete and up to
date product offering. Within Marketing and Management & Administration Uster Technologies Ltd launched
several projects and initiatives, to increase the efficiency of internal processes, to follow ongoing development of
employees and to further consolidate and expand the position as a market leader with a superior market presence.
Balance Sheet
The balance sheet total as of December 31, 2011, amounted to CHF 403.7 million (2010: CHF 399.5 million). Key
changes were:
• Amortization of intangible assets of CHF 15.3 million (assets)
• Net increase of property plant and equipment CHF 1.4 million (assets)
Comment on the Consolidated Financial Statements 2011 53
• Increase in inventories and receivables trade CHF 8.2 million (assets)
• Increase in cash of CHF 7.8 million (assets)
• Loan repayments of CHF 28.0 million net (liabilities)
• Increase of provisions CHF 6.6 million (liabilities)
• Shareholder’s equity increase by CHF 27.6 million mainly as a result of the positive net result and dividend
paid (equity)
• The equity ratio increased to 62.5 % (2010: 56.2 %)
Impairment Test of Intangible Assets and Goodwill
Uster Technologies Ltd performs an impairment test on the goodwill and the intangible assets at least once
a year. The latest impairment test was performed in the fourth quarter of 2011 and was based on recent market
developments, realistic internal assumptions and external input on key parameters. The impairment test
confirmed the carrying amounts of the goodwill and related intangible assets.
Bank Loans
The bank loans existing as of December 31, 2010 were fully repaid in October 2011 and Uster Technologies Ltd
entered into a new loan agreement consisting of a Facility A with an initial balance of CHF 50.0 million and
a Facility B with an initial balance of CHF 20.0 million reducing debt by CHF 28.0 million. The maturity date
of these bank loans is October 2016. Free, not utilized credit facilities amount to CHF 40.0 million, in total.
Cash Flow Statement
With a cash flow from operating activities of CHF 54.0 million Uster Technologies Ltd continues to prove its
strong cash generation ability. This cash flow has been used for capital expenditures of CHF 5.1 million, to reduce
debt by CHF 28.0 million down to CHF 70.0 million and to pay a dividend of CHF 1.20 per share (CHF 10.2 mil-
lion). Cash as of December 31, 2011, improved by CHF 7.8 million to CHF 28.8 million (2010: CHF 21.0 million).
Capital Expenditure for Intangible and Tangible Assets
Capital expenditure for intangible and tangible assets amounted to CHF 5.1 million (2010: CHF 3.8 million).
The main areas of investment were:
• Machinery
• IT-infrastructure
• Fixtures and office equipment
Personnel
As of December 31, 2011, the Uster Group employed 498 full time equivalents (2010: 445) which is an increase
of 11.9 % compared to the prior year.
Taxes
The expected income tax for the Uster Group remains at 17 %, unchanged to prior year.
Dividend Proposal
At the General Meeting on April 12, 2012 the Board of Directors will propose a dividend payment of
CHF 2.50 / share.
54 Uster Group – Consolidated Financial Statements 2011
Uster Group – Consolidated Financial Statements
Consolidated Statement of Comprehensive Income
in CHF 1,000 Notes Jan 1 –
Dec 31, 2011
Jan 1 –
Dec 31, 2010
Gross sales 192,510 100.0 % 132,841 100.0 %
Sales deductions 6 -4,361 -2,746
Net sales 188,149 97.7 % 130,095 97.9 %
Cost of goods sold 7 -68,348 -52,978
Gross profit 119,801 62.2 % 77,117 58.1 %
Sales and marketing expenses 8.1 -23,129 -14,274
Research and development expenses 8.2 -18,174 -14,916
Management and administrative expenses 8.3 -22,032 -13,418
Other income 156 71
Other expenses / amortization 9 -15,262 -15,149
Earnings before interest and tax (EBIT) 41,360 21.5 % 19,431 14.6 %
Amortization 12 15,275 15,171
Earnings before interest tax and amortization (EBITA)
56,635 29.4 % 34,602 26.0 %
Amortization 12 -15,275 -15,171
Earnings before interest and tax (EBIT) 41,360 21.5 % 19,431 14.6 %
Finance income 2,481 2,443
Finance expenses -4,194 -7,580
Finance result 10 -1,713 -0.9 % -5,137 -3.9 %
Earnings before tax 39,647 20.6 % 14,294 10.8 %
Income tax 16 -3,410 6,469
Profit of the year 36,237 18.8 % 20,763 15.6 %
Currency translation differences 82 -649
Total comprehensive income 36,319 18.9 % 20,114 15.1 %
Earnings per share (in CHF)Basic 11 4.28 2.45
Diluted 11 4.20 2.44
Uster Group – Consolidated Financial Statements 2011 55
Consolidated Statement of Financial Position
in CHF 1,000 Notes Dec 31, 2011 Dec 31, 2010
Trademark and goodwill 1 2 119,889 119,889 Intangible assets 12 184,436 199,103 Property, plant and equipment 14 11,616 10,263 Pension fund asset 15 13,290 13,867 Financial assets 200 173 Deferred tax assets 16 2,924 1,938 Non-current assets 332,355 82.3 % 345,233 86.4 %
Inventories 17 14,645 12,373 Receivables trade 18 23,809 17,892 Other receivables 19 3,287 2,128 Income tax receivables 740 779 Cash and cash equivalents 20 28,816 21,049 Current assets 71,297 17.7 % 54,221 13.6 %
Assets 403,652 100.0 % 399,454 100.0 %
Share capital 79,524 79,524 Share premium 93,539 103,691 Reserve for share-based payment transaction 22 2,322 937 Other reserves 445 445 Currency translation differences -1,884 -1,966 Retained earnings 78,264 42,027 Shareholders’ equity 21 252,210 62.5 % 224,658 56.2 %
Bank loans 23 59,468 87,518 Provisions 24 4,763 1,353 Deferred tax liabilities 16 41,267 42,360 Non-current liabilities 105,498 26.1 % 131,231 32.9 %
Bank loans 23 10,000 10,000 Derivative financial instruments 4 0 1,134 Trade and other liabilities 25 14,052 12,262 Accrued liabilities 26 14,441 11,527 Provisions 24 2,601 855 Income tax liabilities and provisions 4,850 7,787 Current liabilities 45,944 11.4 % 43,565 10.9 %
Liabilities 151,442 37.5 % 174,796 43.8 %
Shareholders’ equity and liabilities 403,652 100.0 % 399,454 100.0 %
56 Uster Group – Consolidated Financial Statements 2011
Consolidated Statement of Cash Flows
in CHF 1,000 Notes Jan 1 –
Dec 31, 2011
Jan 1 –
Dec 31, 2010
Earnings before tax 39,647 14,294Adjustments for
Depreciation property, plant and equipment 14 3,055 2,393
Amortization intangible assets 12 15,275 15,171
Change in reserve for share-based payment transactions 22 1,385 937
Change in pension fund asset 15 577 1,757
Provisions 5,150 -246
Finance result 10 1,713 5,137
Result from sale of intangible assets and property, plant and
equipment and other non-cash items
-100 366
66,702 39,809
Change in
Inventories -2,017 -2,506
Receivables trade -6,016 -2,748
Other receivables -886 -428
Trade and other liabilities 1,788 8,077
Accrued liabilities 2,811 464
Change in working capital -4,320 2,859
Income taxes paid -8,365 -23
Cash flow from operating activities 54,017 42,645
Purchase of intangible assets 12 -608 -377
Purchase of property, plant and equipment 14 -4,464 -3,408
Purchase of financial assets -47 -23
Disposal of property, plant and equipment 102 64
Disposal of financial assets 25 13
Interest received 157 97
Cash flow from / (used in) investing activities -4,835 -3,634
Uster Group – Consolidated Financial Statements 2011 57
Consolidated Statement of Cash Flows (continued)
in CHF 1,000 Notes Jan 1 –
Dec 31, 2011
Jan 1 –
Dec 31, 2010
Proceeds from bank loans 23 69,450 0
Repayment of bank loans 23 -98,000 -27,000
Dividends paid 2 1 -10,152 0
Interest paid -2,608 -5,729
Cash flow from / (used in) financing activities -41,310 -32,729
Net change in cash and cash equivalents 7,872 6,282Cash and cash equivalents at beginning of period 21,049 15,053
Exchange differences on cash and cash equivalents -105 -286
Cash and cash equivalents at end of period 20 28,816 21,049
Cash flow from operating activities in % of EBITA 95.4 % 123.2 %
58 Uster Group – Consolidated Financial Statements 2011
Consolidated Statement of Changes in Equity
in CHF 1,000 Share
Capital
Share
Premium
Reserve for Share-
based Payment
Transaction
Other Reserves Currency
Translation
Differences
Retained
Earnings
2010
Balance at January 1, 2010 79,524 103,691 0 447 -1,317 21,262 203,607Profit of the year 0 0 0 0 0 20,763 20,763Other comprehensive income 0 0 0 0 -649 0 -649Total comprehensive income 0 0 0 0 -649 20,763 20,114Share-based payment transaction 0 0 937 0 0 0 937Allocation to/from statutory reserves 0 0 0 -2 0 2 0Balance at December 31, 2010 79,524 103,691 937 445 -1,966 42,027 224,658
in CHF 1,000 Share
Capital
Share
Premium
Reserve for Share-
based Payment
Transaction
Other Reserves Currency
Translation
Differences
Retained
Earnings
2011
Balance at January 1, 2011 79,524 103,691 937 445 -1,966 42,027 224,658Profit of the year 0 0 0 0 0 36,237 36,237Other comprehensive income 0 0 0 0 82 0 82Total comprehensive income 0 0 0 0 82 36,237 36,319Share-based payment transaction 0 0 1,385 0 0 0 1,385Dividend 0 -10,152 0 0 0 0 -10,152Balance at December 31, 2011 79,524 93,539 2,322 445 -1,884 78,264 252,210
For details to the Shareholders' equity refer to note 21 Share Capital and Reserves.
Uster Group – Notes to the Consolidated Financial Statements 2011 59
Uster Group – Notes to the Consolidated Financial Statements
1 Corporate Information
Uster Technologies Ltd (“the Company”) and its subsidiaries (together “the Group”) are the world’s market
leader in textile quality measurement and provide systems and services that enable the industry to manu-
facture optimum quality and competitive products “from fiber to fabric”. The Group has a long history as
the leader in textile electronics. For more than 60 years the testing and monitoring solutions have enabled
the production of the finest fibers, yarns and fabrics.
Uster Technologies Ltd is domiciled in Switzerland. The address of its registered office is Sonnenberg-
strasse 10, CH-8610 Uster, Switzerland.
2 Basis of Preparation of the Consolidated Financial Statements
2.1 Statement of Compliance
The consolidated financial statements of the Uster Group have been prepared in accordance with the
International Financial Reporting Standards (IFRS).
The consolidated financial statements of the Uster Group for the year ended December 31, 2011, were autho-
rized for issue in accordance with a resolution of the Board of Directors on February 17, 2012. The general
meeting of shareholders will be held on April 12, 2012. According to the Swiss Code of Obligations, the
general meeting of shareholders has the authority to approve the financial statements.
2.2 Basis of Measurement
The consolidated financial statements have been prepared on a historical cost basis except for the derivative
financial instruments mentioned in note 4.3 Market Risk that have been measured at fair value.
2.3 Functional and Presentation Currency
The consolidated financial statements are stated in Swiss Francs, which is the Company’s functional
currency. All values are rounded to the nearest thousand (CHF 1,000) except when otherwise indicated.
2.4 Significant Accounting Judgments and Estimates
In the process of preparing the consolidated financial statements the Executive Committee of the Uster Group
has to make judgments, assumptions and estimations that affect the reported amounts of assets, liabilities,
income and expenses. These estimates are reviewed on a regular basis and are based on past experience as
well as assumptions about the future that currently seem to be reasonable. The actual results, however, could
differ from these estimates.
The key estimates and assumptions that have a significant risk of causing material adjustments to the
carrying amounts of assets and liabilities are mentioned below.
2.5 Impairment of Goodwill and Intangible Assets
The Uster Group determines at least on an annual basis whether goodwill and intangible assets with in-
definite useful lives are to be impaired or not. For intangible assets with definite useful lives the useful life
is reviewed each year and assessed for impairment whenever there is an indicator that the intangible asset
may be impaired. This requires an estimation of the value in use of the cash-generating units to which the
goodwill and the intangible assets are allocated. Estimating the value in use requires to make an estimate of
the future cash flows of the cash-generating units and to choose a suitable discount rate for the calculation
of the present value of those cash flows (see note 13 Impairment Testing of Goodwill and Intangible Assets
with Indefinite Useful Lives). These estimations are based on internal and external sources of information.
60 Uster Group – Notes to the Consolidated Financial Statements 2011
2.6 Pension Benefits
The cost of defined benefit pension plans is determined using actuarial valuations. The actuarial valuation
involves making assumptions about discount rates, expected rates of return on assets, future salary
increases, mortality rates and future pension increases. Due to the long-term nature of these plans, such
estimates are subject to significant uncertainty (see note 15 Pension Benefits).
3 Summary of Significant Accounting Policies
3.1 Changes in Accounting Policies and Presentation
The accounting policies adopted in the preparation of these consolidated financial statements are consistent
with those followed in the preparation of the Group’s annual financial statements for the year ended Decem-
ber 31, 2010.
Standards, Amendments and Interpretations Effective in 2011 Relevant for the Group
Standard /
Interpretation
Title
Effective Date
IAS 24 Related Party Disclosures January 1, 2011
The IASB issued an amendment to IAS 24 that clarifies the definitions of a related party. The new definitions
emphasise a symmetrical view of related party relationships and clarify the circumstances in which persons
and key management personnel affect related party relationships of an entity. The adoption of the amend-
ment did not have any impact on the financial position or performance of the Group.
Standards, Amendments and Interpretations Effective in 2011 not Relevant for the Group
Standard /
Interpretation
Title
Effective Date
IFRS 1 Amendment – Limited Exemption from Comparative
IFRS 7 Disclosures
July 1, 2010
IAS 32 Amendment relating to classification of rights issues February 1, 2010
IFRIC 19 extinguishing financial liabilities with equity instru-
ments
July 1, 2010
IFRIC 14 Pre-payments of a minimum funding requirement January 1, 2011
Improvements to IFRS May 2010 January 1, 2011
Uster Group – Notes to the Consolidated Financial Statements 2011 61
Standards, Amendments and Interpretations that are not yet effective in 2011
and have not been early adopted by the Group
Standard /
Interpretation
Title
Effective Date
IFRS 1 Severe Hyperinflation and Removal of Fixed Dates for
First-time Adopters – Amendment July 1, 2011
IFRS 7 Disclosures on transfers of financial assets – Amendment July 1, 2011
IFRS 7 Disclosures-Offsetting Financial Assets and Financial
Liabilities – Amendments January 1, 2013
IFRS 9 Financial instruments (issued in 2010) January 1, 2015
IFRS 10 Consolidated Financial Statements January 1, 2013
IFRS 11 Joint Arrangements January 1, 2013
IFRS 12 Disclosure of Interests in Other Entities January 1, 2013
IFRS 13 Fair Value Measurement January 1, 2013
IAS 1 Presentation of Items of Other Comprehensive
Income – Amendment July 1, 2012
IAS 12 Deferred tax accounting: Recovery of Underlying
Assets – Amendment
IAS 19 Employee Benefits – Revised January 1, 2013
IAS 27 Separate Financial Statements – Revised January 1, 2013
IAS 28 Investments in Associates and Joint Ventures – Revised January 1, 2013
IAS 32 Offsetting Financial Assets and Financial
Liabilities –Amendments January 1, 2014
IFRIC 20 Stripping Costs in the Production
Phase of a Surface Mine
January 1, 2013
The standards and interpretations described below are those that the Group reasonably expects to
have an impact on disclosures, financial position or performance when applied at a future date. The Group
intends to adopt these standards when they become effective.
IFRS 9 Financial Instruments: Classification and Measurement
IFRS 9 as issued reflects the first phase of the IASBs work on the replacement of IAS 39 and applies to clas-
sification and measurement of financial assets and financial liabilities as defined in IAS 39. In subsequent
phases, the IASB will address hedge accounting and impairment of financial assets. IFRS 9 requires financial
assets to be classified into two measurement categories: those measured as at fair value and those measured
at amortised cost. The determination is made at initial recognition. The classification depends on the entity’s
business model for managing its financial instruments and the contractual cash flow characteristics of the
instrument. For financial liabilities, the standard retains most of the IAS 39 requirements. Therefore, given
the current structure of the financial instruments of the Group, the adoption of the first phase of IFRS 9 will
have no material impact on classification and measurements of financial assets and liabilities. The standard
is effective for annual periods beginning on or after 1 January 2015.
62 Uster Group – Notes to the Consolidated Financial Statements 2011
IAS 19 Employee Benefits (Revised)
IAS 19, ‘Employee benefits’ was amended in June 2011. The impact on the group will be as follows: to eli-
minate the corridor approach and recognise all actuarial gains and losses in Other Comprehensive Income
as they occur; and to replace interest cost and expected return on plan assets with a net interest amount
that is calculated by applying the discount rate to the net defined benefit liability (asset). Accordingly
based on the 2011 figures, the recognition of the unrecognized accumulated losses of CHF 14.5 million as
of 31. December 2011 would decrease the pension fund assets by CHF 14.5 million and correspondently
decrease the equity by the same amount. The 2012 pension cost is expected to increase by CHF 0.8 million
due to the replacement of the expected return on plan assets and interests cost with a net interest. On the
other side the elimination of the amortization of actuarial losses would decrease the pension cost by
CHF 0.9 million. The amendment becomes effective for annual periods beginning on or after 1 January 2013.
3.2 Basis of Consolidation
The consolidated financial statements comprise the financial statements of Uster Technologies Ltd and all
its subsidiaries for the period ended December 31, 2011 and 2010, respectively. The financial statements of
the subsidiaries are prepared for the same reporting period as the parent company, using consistent account-
ing policies.
Subsidiaries are entities over which the Group has control, i.e. has the power to govern the financial and
operating policies so as to obtain benefits from their activities. The financial statements of subsidiaries are
included in the consolidated financial statements from the date that control commences until the date that
control ceases.
All intragroup balances as well as any income and expenses arising from intragroup transactions are elim-
inated upon consolidation. Profits and losses arising from intragroup transactions are eliminated in full.
3.3 Foreign Currency
Foreign Currency Transactions
Each subsidiary determines its functional currency, and items included in the financial statements of each
subsidiary are measured using that functional currency. Transactions in foreign currencies are initially
recorded in the functional currency at the rate ruling at the date of the transaction.
Monetary assets and liabilities denominated in foreign currency at the reporting date are translated into the
functional currency using the rates valid at that date.
Exchange rate gains and losses arising from transactions and from the translation of monetary items
denominated in foreign currencies are recognized in profit or loss.
Uster Group – Notes to the Consolidated Financial Statements 2011 63
Foreign Subsidiaries
As at the reporting date the financial statements of all subsidiaries that have a functional currency different
from the presentation currency are translated into the presentation currency as follows:
• Assets and liabilities are translated at the closing rate ruling at the reporting date.
• Income and expenses are translated at exchange rates at the dates of transactions.
The exchange differences resulting from the above translation are recognized directly in other comprehen-
sive income. Upon the disposal of or loss of control on a foreign subsidiary the deferred cumulative exchange
differences stated in other comprehensive income are recognized in profit or loss. None of the subsidiaries
has the currency of a hyperinflationary economy.
Foreign exchange gains and losses resulting from intragroup loans of which the settlement is neither planned
nor likely in the foreseeable future are considered to be part of a net investment in a subsidiary and are
re cognized directly in other comprehensive income. The deferred cumulative exchange differences stated
in other comprehensive income are recognized in profit or loss on disposal of the foreign subsidiary or on
loss of control on the subsidiary.
The following rates were used for the translation of the financial statements of the foreign subsidiaries:
Closing Rates Average Rates
Dec 31, 2011 Dec 31, 2010 Jan 1 –
Dec 31, 2011
Jan 1 –
Dec 31, 2010
CHF CHF CHF CHF
USD 1 0.939 0.936 0.888 1.043
EUR 1 1.216 1.250 1.234 1.382
JPY 100 1.213 1.151 1.114 1.188
CNY 100 14.899 14.174 13.739 15.405
THB 100 2.966 3.113 2.911 3.288
INR 100 1.769 2.092 1.907 2.281
BRL 100 50.317 56.383 53.109 59.241
MXN 100 6.734 7.556 7.163 8.259
TRY 100 49.755 60.423 53.158 69.214
64 Uster Group – Notes to the Consolidated Financial Statements 2011
3.4 Intangible Assets
Business Combinations and Goodwill
Business combinations are accounted for using the acquisition method. This involves recognizing identi-
fiable assets (including previously unrecognized intangible assets) and liabilities (including contingent
liabilities and excluding future restructuring) of the acquired business at fair value.
Goodwill represents the excess of the consideration transferred and the amount recognized for non-control-
ling interest at the date of the acquisition of the net identifiable assets, liabilities and contingent liabilities
assumed. When the excess is negative (negative goodwill), it is recognized immediately in profit or loss.
Goodwill acquired in a business combination is initially measured at cost.
Following initial recognition goodwill is measured at cost less any accumulated impairment losses. For the
purpose of impairment testing goodwill is allocated from the date of acquisition to cash-generating units.
The allocation is made to those cash-generating units or groups of cash-generating units that are expected
to benefit from the business combination, irrespective of whether other assets or liabilities of the Group are
assigned to those units. Each unit to which the goodwill is allocated represents the lowest level within the
Uster Group at which the goodwill is monitored for internal management purposes. Impairment losses on
goodwill are not reversed.
Research and Development
Research costs are expensed as incurred. An intangible asset arising from development expenditure on an
individual project is recognized only when the Group can demonstrate the technical feasibility of complet-
ing the intangible asset so that it will be available for use or sale, its intention to complete and its ability to
use or sell the asset, how the asset will generate future economic benefits, the availability of resources to
complete the asset and the ability to measure reliably the expenditure during the development. Currently
the Group has not capitalized development cost.
Other Intangible Assets
Intangible assets acquired separately are measured on initial recognition at cost. The cost of intangible assets
acquired in a business combination is the fair value at the date of acquisition. Following initial recognition
intangible assets are carried at cost less any accumulated amortization and any accumulated impairment
losses. The useful lives of intangible assets are assessed to be either definite or indefinite.
Intangible assets with finite lives are amortized using the straight-line method over their useful economic
life and assessed for impairment whenever there is an indication that the intangible asset may be impaired.
The amortization period and the amortization method for an intangible asset with a finite useful life are
reviewed at least once, usually at the end of, each financial year. Changes in the expected useful life or the
expected pattern of consumption of future economic benefits embodied in the asset are accounted for by
changing the amortization period or method and treated as changes in accounting estimates. The amortiza-
tion expense on intangible assets with finite lives is recognized in the expense category consistent with the
function of the intangible assets.
Intangible assets with an indefinite useful life are tested annually for impairment either individually or at
the level of the cash-generating unit. Such intangibles are not amortized. The useful life of an intangible
asset with an indefinite life is reviewed annually to determine whether indefinite life assessment continues
to be supportable. If not, the change in the useful life assessment from indefinite to definite is made on a
prospective basis.
The useful lives of the intangible assets are as follows:
Uster Group – Notes to the Consolidated Financial Statements 2011 65
Useful Life in Years
Software 5
Customer base 20
Technology 10
USTER® STATISTICS 25
Trademark indefinite
3.5 Property, Plant and Equipment
Property, plant and equipment including land and buildings are stated at cost less accumulated depreciation
and accumulated impairment. Such cost includes expenditure directly attributable to the acquisition of the
property, plant and equipment.
The cost of replacing part of property, plant and equipment is included in the carrying amount of the item
if it is probable that the future economic benefits associated with the item will flow to the Group and the
cost can be measured reliably. The cost for all other repairs and maintenance is charged to the Statement of
Comprehensive Income as incurred.
Depreciation is calculated using the straight-line method over the estimated useful lives of the assets. Land
is not depreciated.
The useful lives of property, plant and equipment are as follows:
Useful Life in Years
Buildings 25
Plant and machinery 3 – 5
Office equipment 3 – 5
IT and communication equipment 2 – 6
Vehicles 4 – 5
The residual values and useful lives of property, plant and equipment are reviewed and adjusted, if appropri-
ate, at the end of each financial year.
The carrying values of property, plant and equipment are reviewed for impairment when events or changes
in circumstances indicate that the carrying value may not be recoverable.
Items of property, plant and equipment are derecognized upon disposal or when no future economic
benefits are expected from their use or disposal. Any gains or losses on disposals are recognized in profit or
loss within “Other income” or “Other expenses”.
66 Uster Group – Notes to the Consolidated Financial Statements 2011
3.6 Financial Instruments
Financial Instruments
Financial instruments comprise investments in equity and debt securities, trade and other receivables, cash
and cash equivalents, loans and borrowings, trade and other payables as well as accrued liabilities.
Financial instruments are classified in the following categories:
• Financial assets at fair value through profit or loss
• Loans and receivables
• Held-to-maturity investments
• Available-for-sale financial assets
• Financial liabilities at fair value through profit or loss
• Financial liabilities at amortized cost
The classification depends on the purpose for which the financial assets or liabilities were acquired or entered
into and is determined at initial recognition.
Non-derivative financial instruments are recognized initially at fair value plus, for instruments not at fair
value through profit and loss, any directly attributable transaction costs. Subsequent to initial recognition
they are measured as described below.
Financial Assets at Fair Value through Profit or Loss
Financial assets at fair value through profit or loss include financial assets held for trading. A financial asset
falls under this category if acquired principally for the purpose of selling in the short-term. Assets in this
category are classified as current assets. The Group did not have financial instruments falling under this
category on December 31, 2011 or 2010.
Subsequent to initial recognition financial assets at fair value through profit or loss are measured at fair
value, and changes therein are recognized in profit or loss without any deduction for transaction costs that
may occur on sale or disposal.
Loans and Receivables
Loans and receivables are non-derivative financial assets with fixed or determinable payments that are not
quoted in an active market. They are included in current assets, except for maturities greater than 12 months
after the reporting date. These are classified as non-current assets. The Group’s loans and receivables comprise
“receivables trade” (note 18 Receivables Trade), “other receivables” (note 19 Other Receivables), “cash and
cash equivalents” (note 20 Cash and Cash Equivalents) as well as “financial assets” that include mainly
deposits.
Loans and receivables are carried at amortized cost, using the effective interest method less any allowance
for impairment. Gains and losses are recognized in profit and loss when the loans and receivables are
derecognized or impaired.
Held-to-maturity Investments
Held-to-maturity investments are non-derivative financial instruments which carry fixed or determinable
payments and fixed maturities and which the Group has the positive intention and ability to hold to matu-
rity. The Group did not have financial instruments falling under this category on December 31, 2011 or 2010.
Uster Group – Notes to the Consolidated Financial Statements 2011 67
Available-for-sale Financial Assets
Available-for-sale financial assets are those non-derivative financial instruments that are designated as
available-for-sale or are not classified in any of the three preceding categories. As of December 31, 2011 and
2010, no financial assets have been designated as available-for-sale financial assets.
Financial Liabilities at Fair Value through Profit or Loss
Financial liabilities at fair value through profit or loss include financial liabilities held for trading. A finan-
cial liability falls under this category if entered into principally for the purpose of repayment in the short-
term. Liabilities in this category are classified as current liabilities.
Subsequent to initial recognition financial liabilities at fair value through profit or loss are measured at fair
value, and changes therein are recognized in profit or loss.
Financial Liabilities at Amortized Cost
All loans and borrowings are initially recognized at fair value less directly attributable transaction costs.
Subsequently they are measured at amortized cost, using the effective interest method. Gains and losses are
recognized in profit or loss when the liabilities are derecognized as well as through the amortization process.
As of December 31, 2011 and 2010, the Group had bank loans as well as trade and other liabilities that qualified
as financial liabilities at amortized cost (see notes 23 Bank Loans and 25 Trade and Other Liabilities).
Accounting for finance income and expenses is discussed in note 3.15 Finance Income and Expenses.
Share Capital
Ordinary Shares
Ordinary shares are classified as equity. Transaction costs directly attributable to the issue of ordinary shares
are recognized as a deduction from equity net of any tax effects.
Treasury Shares
When share capital is repurchased, the amount of the consideration paid is recognized as a deduction from
equity. When treasury shares are sold or reissued subsequently, the amount received is recognized as an
increase in equity and the resulting surplus or deficit on the transaction is recorded in retained earnings. As
of December 31, 2011 and 2010, the Group did not have any treasury shares.
3.7 Share-Based Payment Transactions
The Group operates a Restricted Stock Unit Plan under which the Group receives services from employees
as consideration for shares of the Group at CHF 9.40 each.
Equity-settled Transactions
The cost of equity-settled transactions is recognized, together with a corresponding increase in reserve for
share-based payment transaction in equity, over the period in which the performance and/or service condi-
tions are fulfilled. The cumulative expense recognized for equity-settled transactions at each reporting date
until the vesting date reflects the extent to which the vesting period has expired and the Group’s best estimate
of the number of equity instruments that will ultimately vest. The income statement expense or credit for a
period represents the movement in cumulative expense recognized as at the beginning and end of that
period and is recognized in personnel expense (note 8.4).
68 Uster Group – Notes to the Consolidated Financial Statements 2011
Expense is recognized for equity-settled transactions where vesting is conditional upon a market or non-
vesting condition, which are treated as vested irrespective of whether or not the market or non-vesting
condition is satisfied, provided that all other performance and/or service conditions are satisfied. Where the
terms of an equity-settled transaction award are modified, the minimum expense recognized is the expense
as if the terms had not been modified, if the original terms of the award are met. An additional expense is
recognized for any modification that increases the total fair value of the share-based payment transaction,
or is otherwise beneficial to the employee as measured at the date of modification. Where an equity-settled
award is cancelled, it is treated as if vested on the date of cancellation, and any expense not yet recognized
for the award is recognized immediately. This includes any award where non-vesting conditions within the
control of either the entity or the employee are not met. However, if a new award is substituted for the can-
celled award, and designated as a replacement award on the date that it is granted, the cancelled and new
awards are treated as if they were a modification of the original award, as described in the previous paragraph.
All cancellations of equity-settled transaction awards are treated equally. The dilutive effect of outstanding
options is reflected as additional share dilution in the computation of diluted earnings per share (further
details are given in note 22).
3.8 Inventories
Inventories are measured at the lower of cost and net realizable value. Cost for inventories is based on the
weighted average principle and includes expenditure incurred in acquiring the inventories, conversion costs
and other costs incurred in bringing them to their existing location and condition. Manufactured inventories
as well as work in progress cost includes an appropriate share of production overheads based on normal
operating capacity.
Net realizable value is the estimated selling price in the ordinary course of business less the estimated costs
of completion and the selling expenses.
3.9 Cash and Cash Equivalents
Cash and cash equivalents include cash on hand, bank account balances as well as short-term deposits with
an original maturity of 90 days or less.
3.10 Provisions
Provisions are recognized when the following criteria are met:
• The Group has a present legal or constructive obligation as a result of a past event;
• It is probable that an outflow of resources embodying economic benefits will be required to settle the
obligation;
• The amount of the obligation can be reliably estimated.
The expense relating to any provision is presented in the Statement of Comprehensive Income net of any
reimbursement.
3.11 Impairment
Intangible Assets and Property, Plant and Equipment
Assets with an indefinite useful life are not subject to amortization and depreciation but are tested for
impairment annually or more frequently if events or changes in circumstances indicate that the carrying
value may be impaired.
Uster Group – Notes to the Consolidated Financial Statements 2011 69
Assets that are subject to amortization and depreciation are reviewed for impairment whenever there is an
indication that the carrying amount may not be recoverable.
An impairment loss is recognized for the amount by which the asset’s carrying amount exceeds its recover-
able amount. An asset’s recoverable amount is the higher of an asset’s fair value less costs to sell and its
value in use. For the purpose of assessing impairment, assets are grouped at the lowest levels for which there
are separately identifiable cash in flows (cash-generating units).
Impairment losses are recognized in profit or loss. Intangible assets other than goodwill and intangible
assets with indefinite useful lives and property, plant and equipment for which an impairment loss was
recognized are reviewed for possible reversal of the impairment at each reporting date. Such reversal is
recognized in profit or loss.
Financial Assets
A financial asset is assessed at each reporting date to determine whether there is any objective evidence that
it is impaired. An impairment loss in respect of a financial asset measured at amortized cost is calculated as
the difference between its carrying amount and its present value of the future estimated cash flows dis-
counted at the original effective interest rate. An impairment loss in respect of an available for sale financial
asset is calculated by reference to its fair value. Individually significant financial assets are tested for impair-
ment on an individual basis. In relation to trade receivables a provision for impairment is made when there
is objective evidence (such as the probability of insolvency or significant financial difficulties of the debtor)
that the Group will not be able to collect all of the amounts due under the original terms of the invoice. The
carrying amount of the receivable is reduced through use of an allowance account. Impaired debts are derec-
ognized when they are assessed as uncollectible.
3.12 Pension Benefits
Defined Benefit Pension Plan
Uster Technologies Ltd provides pension benefits for its employees in Switzerland in the event of retirement,
disability and death. The pension scheme is organized as a separate legal entity and is funded in accordance
with legal requirements.
Costs and liabilities related to the defined benefit pension plan are determined using the projected unit
credit method with attribution of benefit by service pro rata.
The amount recognized in the Statement of Financial Position in respect of defined benefit pension plans is
the fair value of plan assets less the present value of the defined benefit obligation at reporting date,
together with adjustments for unrecognized actuarial gains and losses, unrecognized past service cost and
for unrecognized assets.
Actuarial gains and losses are recognized as income or expense when the cumulative unrecognized actuar-
ial gain or loss exceeds 10.0 % of the higher of the defined benefit obligation and the fair value of the plan
assets. These gains or losses are recognized over the expected average remaining working life of the em ployees
participating in the plan.
Defined Contribution Plans
For employees in other subsidiaries the company pays contributions to the separate legal entity as the plans’
rules require. The regular contributions constitute net periodic costs for the year in which they are due and
as such are included in personnel expenses.
70 Uster Group – Notes to the Consolidated Financial Statements 2011
3.13 Leases
Leases in terms of which the Group assumes substantially all the risks and rewards of ownership are classi-
fied as finance leases. As of December 31, 2011 and 2010, the Group did not have any finance leases.
All the Group’s leases are operating leases and the leased assets are not recognized in the Group’s Statement
of Financial Position. Operating lease payments are recognized as an expense in profit or loss on a straight-
line basis over the lease term. Lease incentives received are recognized as an integral part of the total lease
expense over the term of the lease.
3.14 Revenue Recognition
Revenue from the sale of testing instrumentation is measured at the fair value of the consideration received
or receivable net of returns, discounts and volume rebates, sales taxes and duty. Revenue is recognized when
the significant risks and rewards of ownership of the goods have passed to the buyer; it is probable that the
economic benefits associated with the transaction will flow to the entity, the associated costs incurred or to
be incurred can be estimated reliably, and the amount of revenue can be measured reliably.
Risks and rewards for products and spare parts sold are usually transferred to the client as soon as the prod-
ucts and spare parts leave an entity of the Uster Group. However, sometimes the transfer of risks and rewards
occurs when they are received by the client at the port of entry.
Revenue from service contracts relating to maintenance of testing instrumentation sold is recognized on
a prorata basis over the contract period. The length of the service contracts usually varies between 3 and
12 months.
3.15 Finance Income and Expenses
Finance income includes interest income on funds invested as well as changes in the fair value of the interest
rate swap described in note 4.3 Market Risk. Interest income is recognized as it accrues in profit or loss using
the effective interest rate method.
Finance expenses comprise interest expense on loans, changes in the fair value of the interest rate swap
described in note 4.3 Market Risk, and impairment losses recognized on non-derivative financial instruments
with the exception of accounts receivable trade for which the valuation allowance is recorded under sales
deductions. All interest expenses on loans are recognized in profit or loss using the effective interest rate
method.
3.16 Income Tax
Income tax includes current and deferred tax. Income tax is recognized in profit or loss except to the extent
that it relates to items recognized directly in equity or in other comprehensive income, in which case it is
recognized in equity or other comprehensive income.
Current Income Tax
Current income tax assets and liabilities for the current and prior periods are measured at the amount
expected to be recovered from or paid to the tax authorities. The tax rates and tax laws used to compute the
amount are those that are enacted at the reporting date.
Uster Group – Notes to the Consolidated Financial Statements 2011 71
Deferred Tax
Deferred income tax is provided using the liability method on temporary differences at the reporting date
between the tax bases of assets and liabilities and their carrying amounts for financial reporting purposes.
Deferred income tax is recognized for all taxable temporary differences except:
• If the deferred income tax arises from the initial recognition of an asset or liability in a transaction that is
not a business combination and, at the time of the transaction, affects neither the accounting profit nor
the taxable profit or loss;
• With respect to the taxable temporary differences associated with investments in subsidiaries where the
timing of the reversal of the temporary differences can be controlled and it is probable that the temporary
differences will not reverse in the foreseeable future;
• On taxable temporary differences arising on the initial recognition of goodwill.
Deferred income tax assets are recognized for all carry forwards of unused tax credits and unused tax losses
to the extent that it is probable that taxable profit will be available against which the deductible temporary
differences and the carry forwards of unused tax credits and losses can be utilized.
Deferred income tax assets and liabilities are measured at the tax rates that are expected to apply in the year
when the asset is realized or the liability is settled, based on tax rates and tax laws that have been enacted or
substantively enacted at the reporting date.
Deferred income tax assets and deferred income tax liabilities are offset if a legally enforceable right exists
to set off current tax assets against current income tax liabilities and the deferred income taxes relate to the
same taxable entity and the same taxation authority.
A provision is made for non-recoverable withholding taxes on undistributed earnings of foreign subsidiaries.
4 Financial Risk Management
The Uster Group is exposed to the following risks from its use of financial instruments:
• Credit risk
• Liquidity risk
• Market risk
Included in this note is information regarding the Group’s exposure to each of these risks, the Group’s objec-
tives, policies and processes for measuring and managing risks as well as information about the management
of capital.
The Board of Directors has set up the Group’s financial risk management framework. The Executive
Committee agrees policies for managing each of the risks and monitors them on a regular basis. The Audit
Committee is responsible to judge the risk assessment established by the Executive Committee and
the proposed measures to reduce risks. It evaluates at regular intervals the financial risk management and
monitoring procedures of the Executive Committee.
72 Uster Group – Notes to the Consolidated Financial Statements 2011
4.1 Credit Risk
Credit risk means the risk to suffer a financial loss if a customer or counterparty to a financial instrument
does not meet the contractual obligations. It arises principally from the Group’s accounts receivable trade.
Generally it is the policy of the Group to work in emerging countries with secured payment terms such as
e. g. letters of credit and prepayments in hard currencies like CHF, EUR, USD or in cases where this is not
possible to insure the revenue at SERV (Swiss Export Risk Insurance) or similar trade financing concepts.
This policy is applied with new customers as well as with existing customers. If customers wish to trade on
credit terms, it is the Group’s policy that these customers are subject to credit verification procedures. In
addition, receivable balances are monitored on an ongoing basis with the result that the Group’s exposure
to losses is not considered significant.
With respect to credit risks arising from other financial assets, the Group’s exposure to credit risks has a
maximum exposure equal to the carrying amount of these financial assets. Since the Group maintains bank-
ing relations with first-class financial institutions, the risk is considered minimal.
The carrying amount of financial assets represents the maximum credit exposure. The maximum exposure
to credit risk at the reporting date was as follows:
in CHF 1,000 Dec 31, 2011 Dec 31, 2010
Financial assets 200 173
Receivables trade 23,809 17,892
Other receivables 585 380
Cash and cash equivalents 28,816 21,049
Total 53,410 39,494
Uster Group – Notes to the Consolidated Financial Statements 2011 73
4.2 Liquidity Risk
Liquidity risk is the risk that the Group will not be able to meet its financial obligations as they become due.
The Group manages its liquidity in a way that it will always have sufficient liquidity to meet its obligations,
even under stressed conditions.
For medium term the Group uses a recurring cash planning tool to monitor its risk to a shortage of funds.
This tool considers the expected cash inflows and outflows in the Group for the coming six months on a
detailed level. The long-term monitoring is done based on the 5-year cash flow forecast also used for impair-
ment testing (see note 13). For temporary cash shortages, the Group currently has two revolving credit
facilities of CHF 5.0 million each and a non-drawn amount of CHF 30.0 million of loan Facility B at its
disposal (2010: CHF 32.0 million in total).
The following table shows the contractual maturities of the financial liabilities:
Dec 31, 2010
in CHF 1,000
Within
1 year
1 to
2 years
3 to
5 years
Total
Bank loans 12,783 90,499 0 103,282Interest rate swap 1,134 0 0 1,134Trade and other liabilities 12,262 0 0 12,262Accrued liabilities 4,937 0 0 4,937Total liabilities 31,116 90,499 0 121,615
Dec 31, 2011
in CHF 1,000
Within
1 year
1 to
2 years
3 to
5 years
Total
Bank loans 10,700 10,900 52,900 74,500Interest rate swap 0 0 0 0Trade and other liabilities 14,052 0 0 14,052Accrued liabilities 4,815 0 0 4,815Total liabilities 29,567 10,900 52,900 93,367
74 Uster Group – Notes to the Consolidated Financial Statements 2011
4.3 Market Risk
Market risk is the risk that changes in market prices such as foreign exchange rates, interest rates and finan-
cial environmental risks affect the Group’s income or the value of its holding of financial instruments.
Foreign Currency Risk
The Group is exposed to currency risks on accounts receivables, accounts payables and loans that are de-
nominated in a currency other than the respective functional currencies of the Group entities. The currencies
in which these positions are primarily denominated as of December 31, 2011, are USD/CHF and CHF/CNY
(transaction currency / functional currency) (2010: USD / CHF, CHF / CNY, TRY / CHF and EUR / CHF).
The Group developed a model to actively control and limit these foreign exchange risks at the source and
therefore has no need to enter into contracts to hedge these exposures as the remaining risk is not significant.
Nevertheless the following sensitivity analysis has been performed.
Increases of 5 % of the transaction currency against the functional currency would have the following impact
on the consolidated financial statements:
Dec 31, 2010
in CHF 1,000
Effect on Profit
before Tax
Effect in
Equity
CurrenciesUSD / CHF -82 -82
CHF / CNY -139 -139
TRY / CHF 26 26
EUR / CHF -26 -26
Dec 31, 2011
in CHF 1,000
Effect on Profit
before Tax
Effect in
Equity
CurrenciesUSD / CHF -106 -106
CHF / CNY -236 -236
Interest Rate Risk
The interest rate exposure is limited to the bank loans described in note 23 Bank Loans. According to the
credit facility agreement for the bank loans that was in place until October 2011, the Group had to hedge at
least CHF 50.0 million of the bank loans. This hedge expired in October 2011. Currently no hedging instru-
ment is in place. However the interest situation and hedging possibilities are continuously monitored.
Uster Group – Notes to the Consolidated Financial Statements 2011 75
The table below sets out the carrying amount of the Group’s interest bearing financial instruments exposed
to interest rate risk:
Dec 31, 2010
in CHF 1,000
Balance within
1 year
1 to
2 years
3 to
5 years
Over
5 years
Variable rateCash and cash equivalents 21,049 0 0 0
Bank loans 97,518 87,759 0 0
Interest rate swap 1,134 0 0 0
Total 119,701 87,759 0 0
Dec 31, 2011
in CHF 1,000
Balance within
1 year
1 to
2 years
3 to
5 years
Over
5 years
Variable rateCash and cash equivalents 28,816 0 0 0
Bank loans 69,468 59,578 49,688 0
Total 98,284 59.578 49,688 0
The Group’s bank loans at variable rate are analyzed on a dynamic basis with regards to the interest rate
exposure. On a regular basis the sensitivity of the Group’s result before tax to a reasonably possible change
in interest rates, with all other variables held constant, is tested.
The result of the sensitivity testing mentioned above is as follows:
Change in base points Effect on result before tax
in CHF 1,000
Dec 31, 2011 Dec 31, 2010
+ 5 -46 -59
+ 20 -185 -233
- 10 68 103
-15 90 117
4.4 Capital Management
The Group’s objectives when managing capital are to safeguard the Group’s ability to continue as a going
concern in order to provide returns for shareholders and benefits for other stakeholders and to maintain an
optimal capital structure to reduce the cost of capital. As of December 31, 2011, equity amounted to 62.5 % of
total equity and liabilities (2010: 56.2 %).
Please refer to note 23 Bank Loans for covenant requirements.
76 Uster Group – Notes to the Consolidated Financial Statements 2011
4.5 Financial Instruments – Fair Values
The fair value of financial assets and liabilities together with the carrying amounts shown in the Statement
of Financial Position are as follows:
in CHF 1,000 Dec 31, 2010
Financial Assets/LiabilitiesValuation
Category acc. to
IAS 39
Valuation
Level acc. to
IFRS 7
Total
Carrying
Amount
Non-financial
Assets/
Liabilities
Amortized
Costs
Fair
Value
Carrying
Amount
Fair Value
AssetsFinancial assets L&R 173 173 173 173
Receivables trade L&R 17,892 17,892 17,892 17,892
Other receivables L&R 2,128 1,748 380 380 380
Cash and cash equivalents L&R 21,049 21,049 21,049 21,049
LiabilitiesBank loans non-current FLAC 87,518 87,518 87,518 88,000
Bank loans current FLAC 10,000 10,000 10,000 10,000
Interest rate swap FLFVTPL 2 1,134 1,134 1,134 1,134
Trade and other liabilities FLAC 12,262 12,262 12,262 12,262
Accrued liabilities FLAC 11,527 6,590 4,937 4,937 4,937
Total -81,199 -76,357 -76,839
in CHF 1,000 Dec 31, 2011
Financial Assets/LiabilitiesValuation
Category acc. to
IAS 39
Valuation
Level acc. to
IFRS 7
Total
Carrying
Amount
Non-financial
Assets/
Liabilities
Amortized
Costs
Fair
Value
Carrying
Amount
Fair Value
AssetsFinancial assets L&R 200 200 200 200
Receivables trade L&R 23,809 23,809 23,809 23,809
Other receivables L&R 3,287 2,702 585 585 585
Cash and cash equivalents L&R 28,816 28,816 28,816 28,816
LiabilitiesBank loans non-current FLAC 59,468 59,468 59,468 60,000
Bank loans current FLAC 10,000 10,000 10,000 10,000
Trade and other liabilities FLAC 14,052 14,052 14,052 14,052
Accrued liabilities FLAC 14,441 9,626 4,815 4,815 4,815
Total -41,849 -34,925 -35,457
Categories:
L&R: Loans and Receivables
FLFVTPL: Financial Liabilities at Fair Value through Profit or Loss
FLAC: Financial Liabilities at Amortized Cost
Uster Group – Notes to the Consolidated Financial Statements 2011 77
The fair value of the bank loans has been determined using current market interest rates. During the report-
ing period there have been no transfers between the Level 1 and Level 2 fair value measurement.
The fair value of unquoted instruments is estimated by discounting expected future cash flows using mar-
ket rates currently available for instruments on similar terms, credit risk and remaining maturities.
5 Segment Reporting
Under the application of IFRS 8 (management approach) the Group is organized in only one operating seg-
ment. Whilst revenues are primarily reported by geographical areas, the operating results and the statement
of financial position are only analyzed at Group level. This is the primary way in which Management and the
board of directors are provided with financial information to decide on allocation of resources. Therefore
the information by operating segment has already been given in these Consolidated Financial Statements.
Additional country level information is provided below the respective table.
Gross Sales by Geographical Location of Customers
in CHF 1,000 Jan 1 –
Dec 31, 2011
Jan 1 –
Dec 31, 2010
Asia 130,162 67.6 % 89,348 67.3 %
Europe 46,352 24.1 % 28,863 21.7 %
Americas 15,996 8.3 % 14,630 11.0 %
Total 192,510 100.0 % 132,841 100.0 %
Total Sales attributable to the country of domicile amounted to CHF 0.9 million (2010: CHF 0.8 million). In
2011 the sales to Chinese customers amounted to 24.1 % of total sales (2010: 27.0 %) and revenues with Indian
customers reached 6.6 % (2010: 9.0 %) of total sales. Revenues of approximately CHF 44.9 million and
CHF 26.5 million respectively are derived from two single external customers included in the geographical
location Asia and CHF 21.5 million from one single external customer included in the geographical location
Europe (2010: CHF 27.5 million and CHF 17.1 million respectively are derived from two single external
customers, both located in the geographical region Asia).
78 Uster Group – Notes to the Consolidated Financial Statements 2011
Gross Sales by Testing Instrumentation and Service
Gross sales primarily derive from the sale of testing instrumentation which is used to increase and balance
the quality of textile production and from service sales consisting of the maintenance of these instruments.
in CHF 1,000 Dec 31, 2011 Dec 31, 2010
Testing instrumentation 174,506 90.6 % 114,147 85.9 %
Service sales 18,004 9.4 % 18,694 14.1 %
Total 192,510 100.0 % 132,841 100.0 %
Non-current Assets1) by Geographical Location of Legal Entity
in CHF 1,000 Dec 31, 2011 Dec 31, 2010
Asia 4,093 1.3 % 3,607 1.1 %
Europe 309,582 98.0 % 323,174 98.1 %
Americas 2,266 0.7 % 2,474 0.8 %
Total 315,941 100.0 % 329,255 100.0 %
1) Other than financial instruments, deferred tax assets and post-employment benefit assets.
The full amount of non-current assets in Europe is attributable to the country of domicile.
6 Sales Deductions
Sales deductions include items that are directly related to revenue from sales such as discounts, currency
differences, shipping expenses and the change in the allowance for uncollectible receivables (see note 18
Receivables Trade).
7 Cost of Goods Sold
Cost of goods sold comprises direct production costs such as material expense and personnel costs as well
as a proportion of overhead costs like logistics procurement and quality control. The material expense for
2011 amounted to CHF 39.1 million (2010: CHF 32.3 million).
Additionally warranty costs and the depreciation on the production equipment are included in this expense
category.
8 Overhead
8.1 Sales and Marketing Expenses
This position contains expenses for sales and marketing activities such as wages, amortization, depreciation,
project cost, agent commissions, consultancy, and other overhead costs.
8.2 Research and Development Expenses
The expenditure for research and development includes wages, amortization, depreciation, material costs,
consultancy, and other overhead costs related to research and development projects.
8.3 Management and Administrative Expenses
Management and administrative expenses consist of wages, amortization, depreciation, rent, consultancy,
IT, and other overhead costs of the support process.
Uster Group – Notes to the Consolidated Financial Statements 2011 79
8.4 Personnel Expense
in CHF 1,000 Jan 1 –
Dec 31, 2011
Jan 1 –
Dec 31, 2010
Wages and salaries 36,848 29,644
Social security costs 4,116 3,547
Pension costs 2,802 3,722
Share-based payment transaction expense 1,385 937
Other personnel expense 2,667 1,558
Total 47,818 39,408
8.5 Amortization, Impairment and Depreciation
in CHF 1,000 Jan 1 –
Dec 31, 2011
Jan 1 –
Dec 31, 2010
Amortization of technology, customer base, USTER® STATISTICS 15,066 15,066
Amortization of other intangible assets 209 105
Depreciation of property, plant and equipment 3,055 2,393
Total 18,330 17,564
9 Other Expenses
Other expenses amounting to CHF 15.3 million (2010: CHF 15.1 million) consist mainly of the amortization of
technology, customer base, and USTER® STATISTICS.
10 Finance Result
in CHF 1,000 Jan 1 –
Dec 31, 2011
Jan 1 –
Dec 31, 2010
Interest income bank accounts & fixed-term deposits (L&R) 114 84
Interest income other receivables (L&R) 139 56
Gain on interest rate swap (FLFVTPL) 1,134 766
Exchange gain 1,094 1,537
Finance income 2,481 2,443
Interest expense bank loans (FLAC) -2,294 -5,367
Other expenses / fees bank loans (FLAC) -648 -507
Other finance expense -166 -96
Exchange loss -1,086 -1,610
Finance expense -4,194 -7,580
Finance result -1,713 -5,137
Categories:
L&R: Loans and Receivables
FLFVTPL: Financial Liabilities at Fair Value through Profit or Loss
FLAC: Financial Liabilities at Amortized Cost
80 Uster Group – Notes to the Consolidated Financial Statements 2011
The net foreign exchange differences charged to the Statement of Comprehensive Income are included in
the following lines:
in CHF 1,000 Jan 1 –
Dec 31, 2011
Jan 1 –
Dec 31, 2010
Sales deductions -341 -450
Cost of goods sold 526 -308
Finance income 1,094 1,537
Finance expense -1,086 -1,610
Total 193 -831
The origin of the above mentioned foreign exchange differences are as follows:
Sales deductions: accounts receivables trade
Cost of goods sold: accounts payable trade
Finance income: mainly other receivables and other payables
Finance expense: mainly other receivables and other payables
11 Earnings per Share
Basic earnings per share amounts are calculated by dividing the net result for the period by the weighted
average number of shares outstanding during the year. Diluted earnings per share amounts are calculated
by dividing the net profit attributable to ordinary equity holders of the parent by the weighted average
number of ordinary shares outstanding during the year plus the weighted average number of ordinary shares
that would be issued on conversion of all the dilutive potential ordinary shares into ordinary shares.
in CHF Jan 1 –
Dec 31, 2011
Jan 1 –
Dec 31, 2010
Basic earnings per shareProfit of the year 36,237,000 20,763,000
Weighted average number of shares outstanding 8,460,000 8,460,000
Earnings per share 4.28 2.45
in CHF Jan 1 –
Dec 31, 2011
Jan 1 –
Dec 31, 2010
Diluted earnings per shareProfit of the year 36,237,000 20,763,000
Weighted average number of shares outstanding incl. dilution effect 8,626,960 8,514,462
Earnings per share 4.20 2.44
Number of sharesIssued ordinary shares at January 1 8,460,000 8,460,000
Effect of shares under option 166,960 54,462
Weighted average number of ordinary shares at period end 8,626,960 8,514,462
Uster Group – Notes to the Consolidated Financial Statements 2011 81
12 Intangible Assets
in CHF 1,000 Customer Base Trademark Technology USTER®
STATISTICSGoodwill Other
Intangible
Assets
2010
At CostBalance at January 1, 2010 180,000 58,700 48,500 30,400 64,549 784 382,933Additions 0 0 0 0 0 377 377Disposals 0 0 0 0 0 - 2 - 2Currency translation differences 0 0 0 0 0 -5 -5Balance at December 31, 2010 180,000 58,700 48,500 30,400 64,549 1,154 383,303
Accumulated Amortization / ImpairmentBalance at January 1, 2010 -27,000 0 -14,550 -3,648 -3,360 -586 -49,144Amortization -9,000 0 -4,850 -1,216 0 -105 -15,171Disposals 0 0 0 0 0 2 2Currency translation differences 0 0 0 0 0 2 2Balance at December 31, 2010 -36,000 0 -19,400 -4,864 -3,360 -687 -64,311
Net book value at January 1, 2010 153'000 58'700 33'950 26'752 61'189 198 333'789Net book value at December 31, 2010 144'000 58'700 29'100 25'536 61'189 467 318'992
in CHF 1,000 Customer Base Trademark Technology USTER®
STATISTICSGoodwill 1) Other
Intangible
Assets
2011
At CostBalance at January 1, 2011 180,000 58,700 48,500 30,400 64,549 1,154 383,303Additions 0 0 0 0 0 608 608Disposals 0 0 0 0 - 7 9 3 - 4 2 - 8 3 5Currency translation differences 0 0 0 0 0 2 2Balance at December 31, 2011 180,000 58,700 48,500 30,400 63,756 1,722 383,078
Accumulated Amortization / ImpairmentBalance at January 1, 2011 -36,000 0 -19,400 -4,864 -3,360 -687 -64,311Amortization -9,000 0 -4,850 -1,216 0 -209 -15,275Disposals 0 0 0 0 7 9 3 4 2 8 3 5Currency translation differences 0 0 0 0 0 -2 -2Balance at December 31, 2011 -45,000 0 -24,250 -6,080 -2,567 -856 -78,753
Net book value at January 1, 2011 144,000 58,700 29,100 25,536 61,189 467 318,992Net book value at December 31, 2011 135,000 58,700 24,250 24,320 61,189 866 304,325
1) the disposal of Goodwill is related to the finalization of the liquidation of a subsidiary. The disposed Goodwill was fully amortized.
82 Uster Group – Notes to the Consolidated Financial Statements 2011
Customer Base
The intangible asset “customer base” represents the estimated value of the customers of the Uster Group.
USTER enjoys a strong customer loyalty and appreciation in approximately 75 countries. Technical training,
product performance, trusted measurement and long living products as well as after-sales services produce
high customer retention and loyalty. Its useful life of 20 years (remaining amortization period 15 years) was
reviewed during the fourth quarter of 2011 and was confirmed.
Trademark®
USTER® products are used as standard references for quality control in the global textile industry. USTER®
STATISTICS are used throughout the industry as the base benchmarks for the trading of textile products at
assured levels of quality across global markets. The USTER® STATISTICS are perceived as industry standard
all over the world.
The USTERIZED® concept (as seal of quality for yarns tested and cleared with USTER® products) is increas-
ingly used by well-known consumer companies to assure a consistent level of quality in support of their own
branded products.
Due to the brand awareness and the excellent reputation of the brand “USTER®”, this intangible asset is
considered to have an indefinite useful life.
Technology
The intangible asset technology summarizes the estimated value of the intellectual property of the Group,
i. e. patents and designs which are registered in the name of Uster Technologies Ltd, Switzerland. These
intellectual property rights refer to all the different processes, instruments and machines which have been
developed by the Group through the course of the years. A well-defined policy protects the intellectual prop-
erty in the markets relevant to the business. The Technologies useful life of 10 years (remaining amortization
period 5 years) was reviewed during the fourth quarter of 2011 and was confirmed.
USTER® STATISTICS
USTER provides a service to the textile industry by collecting data from thousands of samples of fiber and
yarn from its customers around the world. The Company produces a database, USTER® STATISTICS, of per-
formance data against the historic population of quality metrics and makes the results freely available to the
industry. USTER® STATISTICS was established in 1957 and looks back on more than 50 years of fiber and yarn
quality measurement. It is perceived as industry standard all over the world. The USTER® STATISTICS’ useful
life of 25 years (remaining amortization period 20 years) was reviewed during the fourth quarter of 2011 and
was confirmed.
13 Impairment Testing of Goodwill and Intangible Assets with Indefinite Useful Lives
The annual impairment test is usually performed in the fourth quarter of each year.
Goodwill and intangible assets with indefinite useful lives acquired through business combinations have
been allocated to the respective individual cash-generating units (CGUs), which correspond to the legal
entities of the Uster Group.
The legal entities are the smallest identifiable group of assets that generate cash inflows that are largely
independent of the cash inflows from other groups of assets.
For the impairment test of each cash-generating unit the recoverable amount has been defined based on the
value in use.
Uster Group – Notes to the Consolidated Financial Statements 2011 83
The impairment test showed that the recoverable amounts of the tested intangible assets are well above their
carrying amount.
The carrying amount of the goodwill allocated to each of the cash-generating units as of December 31, 2011
and 2010, was as follows:
in CHF 1,000 Dec 31, 2011 Dec 31, 2010
Uster Technologies Ltd 60,538 60,538
Other CGU 651 651
Total 61,189 61,189
The carrying amount of CHF 58.7 million of the intangible asset trademark, the only intangible asset with
indefinite useful life, has been allocated to the cash-generating unit Uster Technologies Ltd.
13.1 Key Assumptions Used for the Value in Use Calculations
The following describes each key assumption on which the Group has based its cash flow projections to
undertake the impairment testing of goodwill and intangible assets with indefinite useful lives.
EBITDA
The EBITDA projections are based on current financial forecasts and budgets covering the period from 2012
to 2016. The underlying sales projections were established using historic performance track records, internal
expectations and external official statistics and forecasts. All assumptions made are consistent with past
actual outcomes. The current financial forecast and budgets are approved by the Board of Directors.
Growth Rate
The growth rate used for the value in use calculation of the cash-generating units for the planning period is
based on financial budgets approved by the Board of Directors. The cash flows beyond this period are
extrapolated using the inflation of the Consumer Price Index of the corresponding country as the growth
rate the cash-generating unit is situated in. Using the inflation rate as growth rate reflects past experience
and is supported by external sources.
Discount Rate
The discount rate used is the pre-tax weighted average cost of capital (WACC) based on the capital asset
pricing model. It consists unchanged to prior year of the country specific ten-year governmental bond
rate at the date of the impairment test, a country specific market risk premium, a debt interest rate and a
debt / equity ratio of 50 / 50. Further, a 2 % (2010: 2 %) markup on the cost of equity has been added to take into
account the small cap size of the Uster Group. The values assigned to this key assumption are consistent with
external sources of information.
84 Uster Group – Notes to the Consolidated Financial Statements 2011
The following data was used as a basis for the impairment test made in 2011:
Growth Rate Discount Rate
2011 2010 2011 2010
Uster Technologies Ltd 1.5 % 1.5 % 7.3 % 10.7 %
Other CGU 7.9 % 7.9 % 11.8 % 15.1 %
13.2 Impairment Loss
An impairment loss is recognized if the recoverable amount is below the carrying amount. For the year under
review no impairment loss on goodwill and intangible assets with indefinite useful lives has been recognized.
13.3 Sensitivity Analysis
The Group has kept last year’s approach and has performed a critical sensitivity analysis on the intangibles
with indefinite useful life not only by varying the assumption such as discount rate, but also the long-term
growth rate and the future EBITDA. The Board of Directors and the Executive Committee of the Uster Group
consider these underlying assumptions as accurate. Nevertheless a sensitivity analysis with the following
not cumulative changes on each of the key assumptions has been performed (all other factors held constant):
EBITDA projections: - 30 %
Growth rate: - 1.5 %
Discount rate: + 2.0 %
None of these changes leads to an impairment of either Goodwill or Trademark.
That means that a negative deviation of the EBITDA projections of 30 % does not lead to impairment.
The same applies to an increase of the discount rate of 2 % or a decrease of the growth rate of 1.5 %.
Uster Group – Notes to the Consolidated Financial Statements 2011 85
14 Property, Plant and Equipment
in CHF 1,000 Land and
Buildings
Machinery and
Equipment
Furniture and
Fixtures
2010
At CostBalance at January 1, 2010 2,893 7,539 4,279 14,711Additions 40 2,135 1,233 3,408Disposals -4 -85 -139 -228Currency translation differences -268 -171 -172 -611Balance at December 31, 2010 2,661 9,418 5,201 17,280
Accumulated Depreciation / ImpairmentBalance at January 1, 2010 -441 -2,300 -2,310 -5,051Depreciation -149 -1,303 -941 -2,393Disposals 2 56 101 159Currency translation differences 56 115 97 268Balance at December 31, 2010 -532 -3,432 -3,053 -7,017
Net book value at January 1, 2010 2,452 5,239 1,969 9,660Net book value at December 31, 2010 2,129 5,986 2,148 10,263
Fire insurance values 7,183 17,209 10,062 34,454
in CHF 1,000 Land and
Buildings
Machinery and
Equipment
Furniture and
Fixtures
2011
At CostBalance at January 1, 2011 2,661 9,418 5,201 17,280Additions 0 2,145 2,319 4,464Disposals 0 -210 -568 -778Currency translation differences 10 111 26 147Balance at December 31, 2011 2,671 11,464 6,978 21,113
Accumulated Depreciation / ImpairmentBalance at January 1, 2011 -532 -3,432 -3,053 -7,017Depreciation -127 -1,743 -1,185 -3,055Disposals 0 174 497 671Currency translation differences -10 -57 -29 -96Balance at December 31, 2011 -669 -5,058 -3,770 -9,497
Net book value at January 1, 2011 2,129 5,986 2,148 10,263Net book value at December 31, 2011 2,002 6,406 3,208 11,616
Fire insurance values 4,944 18,851 10,698 34,493
86 Uster Group – Notes to the Consolidated Financial Statements 2011
15 Pension Benefits
15.1 Defined Benefit Pension Plan
Uster Technologies Ltd provides pension benefits for its employees in Switzerland in the event of retirement,
disability and death. The pension scheme is organized as a separate legal entity and is funded in accordance
with legal requirements. The plan assets were lower than the defined benefit obligation leading to a negative
funding position in 2011 (positive funding position in 2010).
The following tables summarize the components of net benefit expense recognized in the Statement of
Comprehensive Income as well as the actual return on plan assets.
in CHF 1,000 Jan 1 –
Dec 31, 2011
Jan 1 –
Dec 31, 2010
Amounts recognized in the income statementCurrent employer service cost -2,048 -2,434
Interest expense -1,455 -2,034
Expected return on plan assets 2,255 2,521
Amortization of net actuarial gain / (loss) -840 -1,137
Pension costs current year -2,088 -3,084
Actual return on plan assetsExpected return 2,255 2,521
Actuarial gain / (loss) on plan assets -3,305 3,099
Actual return on plan assets -1,050 5,620
Uster Technologies Ltd expects to contribute CHF 1.6 million to the defined benefit pension plan in 2012.
The funded status of the pension plan and the amounts recognized in the Statement of Financial Position of
Uster Technologies Ltd are as follows:
in CHF 1,000 Dec 31, 2011 Dec 31, 2010
Funded StatusFair value of plan assets 62,605 61,362
Defined benefit obligation -63,781 -60,635
Surplus / Deficit -1,176 727
Amounts recognized in the balance sheetSurplus / Deficit -1,176 727
Unrecognized actuarial loss / (gain) 14,466 13,140
Pension fund asset / (liability) in the balance sheet 13,290 13,867
Uster Group – Notes to the Consolidated Financial Statements 2011 87
The changes in the present value of the defined benefit obligation are as follows:
in CHF 1,000 Dec 31, 2011 Dec 31, 2010
Reconciliation of defined benefit obligationDefined benefit obligation at January 1 60,635 61,637
Current employer service cost 2,048 2,434
Interest expense 1,455 2,034
Employee contribution 1,290 1,136
Benefit payments -508 -8,440
Actuarial (gain) / loss -1,140 1,834
Defined benefit obligation at December 31 63,781 60,635
The changes in the fair value of the plan assets are as follows:
in CHF 1,000 Dec 31, 2011 Dec 31, 2010
Reconciliation of assetsAssets at January 1 61,362 61,718
Expected return 2,255 2,521
Employer contribution 1,512 1,328
Employee contribution 1,290 1,136
Benefit payments -508 -8,440
Actuarial gain / (loss) on plan assets -3,305 3,099
Assets at December 31 62,605 61,362
The strategic target of major categories of plan assets as a percentage of the fair value of total plan assets are
as follows:
Dec 31, 2011 Dec 31, 2010
Asset categoriesEquity securities 25 % 25 %
Debt securities 29 % 33 %
Property 28 % 26 %
Other 18 % 16 %
The overall expected rate of return is determined based on the plan’s asset allocation strategy and current
market rates.
88 Uster Group – Notes to the Consolidated Financial Statements 2011
The principal assumptions used in determining the defined benefit pension plan obligations are shown
below:
Jan 1 –
Dec 31, 2011
Jan 1–
Dec 31, 2010
Actuarial assumptionsDiscount rate 2.40 % 2.40 %
Expected return on plan assets 3.60 % 3.60 %
Salary increases 2.00 % 2.00 %
Pension increases 0.00 % 0.00 %
The discount rate is determined on the basis of corporate bonds with a rating of AA or AAA.
The history of experience gains and losses is summarized below:
in CHF 1,000 Dec 31, 2011 Dec 31, 2010 Dec 31, 2009 Dec 31, 2008 Dec 31, 2007
History of experience gains and lossesFair value of plan assets 62,605 61,362 61,718 72,245 89,346
Defined benefit obligation -63,781 -60,635 -61,838 -63,802 -70,978
Surplus / Deficit -1,176 727 80 8,443 18,368Experience (gain) / loss on plan assets 3,305 -3,099 6,151 11,185 3,988
Experience gain / (loss) on plan liabilities -1,768 3,387 1,068 -174 630
Uster Group – Notes to the Consolidated Financial Statements 2011 89
16 Income Tax
Statement of Comprehensive Income
in CHF 1,000 Jan 1 –
Dec 31, 2011
Jan 1 –
Dec 31, 2010
Current income taxes -7,222 -4,591
Current income taxes previous years 1,792 3,240
Deferred income taxes 2,020 7,820
Total -3,410 6,469
The current income tax from previous years mainly results from the finalization of the tax assessment for
2009.
A reconciliation of the expected tax expense based on the parent company’s tax rate to the effective tax
expense is as follows:
in CHF 1,000 Jan 1 –
Dec 31, 2011
Jan 1 –
Dec 31, 2010
Earnings before tax 39,647 14,294 Tax at expected tax rate of the parent company -6,740 -17.0 % -2,430 -17.0 %
Income taxed at other rates 1,263 3.2 % 165 1.1 %
Tax effect of non-deductible or non-taxable items -382 -1.0 % -448 -3.1 %Deferred taxes not booked in prior years 557 1.4 % 0 0.0 %Impact of tax rate changes on temporary differences 8 0.0 % 6,416 44.9 %
Unrecognized tax losses 18 0.1 % 22 0.2 %
Non-recoverable withholding tax -7 0.0 % -14 -0.1 %
Current income taxes previous years 1,792 4.5 % 3,240 22.6 %
Others 81 0.2 % -482 -3.4 %
Total -3,410 -8.6 % 6,469 45.2 %
90 Uster Group – Notes to the Consolidated Financial Statements 2011
Recognized Deferred Tax Assets and Liabilities
Deferred tax assets and liabilities are attributable to the following items:
in CHF 1,000 Dec 31, 2011 Dec 31, 2010
Deferred tax assets by types of temporary differenceNon-current assets 390 769
Inventories 1,428 1,140
Trade and other receivables 57 24
Current liabilities and accruals 1,431 759
Total 3,306 2,692
in CHF 1,000 Dec 31, 2011 Dec 31, 2010
Deferred tax liabilities by types of temporary differenceNon-current assets 39,846 41,421
Inventories 469 440
Trade and other receivables 644 474
Other current assets 47 148
Other non-current liabilities 91 82
Current liabilities and accruals 1 5
Non-recoverable withholding tax 551 544
Total 41,649 43,114
Net tax assets / (liabilities) -38,343 -40,422
Deferred tax assets 2,924 1,938
Deferred tax liabilities 41,267 42,360
Uster Group – Notes to the Consolidated Financial Statements 2011 91
Movements in Temporary Differences
The movements in temporary differences were as follows:
in CHF 1,000 Jan 1 –
Dec 31, 2011
Jan 1 –
Dec 31, 2010
Non-current assets 1,203 7,674
Inventories 243 314
Trade and other receivables -132 401
Other current assets 90 -157
Other non-current liabilities -9 59
Current liabilities and accruals 632 -457
Non-recoverable withholding tax -7 -14
Changes booked to income statement 2,020 7,820
Currency differences 59 -137
Other changes 59 -137
Total changes of deferred taxes 2,079 7,683
Unrecognized Deferred Tax Assets
Based on the evaluation of tax assets in the foreign subsidiaries deferred tax assets amounting to CHF 118,000
(2010: 333,000) of which the major part will not expire have not been recognized. These relate to tax losses
and temporary differences for which the Group does not expect to have any future taxable profit to offset
them against.
92 Uster Group – Notes to the Consolidated Financial Statements 2011
17 Inventories
in CHF 1,000 Dec 31, 2011 Dec 31, 2010
Raw materials and supplies 2,737 2,327
Semifinished and finished goods 10,655 9,011
Work in progress 1,253 1,035
Total 14,645 12,373
The amount of write-down of inventories recognized as an expense in profit or loss in 2011 amounted
to CHF -0.8 million (2010: CHF +1.2 million) and is included in cost of goods sold. The total amount of
inventories valued at fair value less cost to sell amounts to CHF 0.0 million (2010: CHF 0.0 million).
18 Receivables Trade
in CHF 1,000 Dec 31, 2011 Dec 31, 2010
Accounts receivable trade 22,055 17,060
Bills receivable trade 1,754 832
Total 23,809 17,892
Accounts receivable trade as well as bills receivable trade are non-interest-bearing and are generally on 30
to 90 days’ terms.
The carrying amounts of trade and bills receivables less the allowance for uncollectible items are assumed
to approximate their fair values due to the short-term nature of trade receivables.
The carrying amount of the Group’s trade receivables are denominated in the following currencies:
in CHF 1,000 Dec 31, 2011 Dec 31, 2010
CHF 18,685 15,445
USD 2,331 1,183
CNY 1,805 880
TRY 50 137
JPY 340 88
EUR 453 0
Other 145 159
Total 23,809 17,892
Uster Group – Notes to the Consolidated Financial Statements 2011 93
The ageing of these receivables is as follows:
in CHF 1,000 Dec 31, 2011 Dec 31, 2010
Not overdue 19,368 13,716
Overdue 1 to 60 days 4,406 4,012
Overdue 61 to 90 days 14 98
Overdue 91 to 120 days 13 52
Overdue 121 to 150 days 8 14
Overdue more than 150 days 0 0
Total 23,809 17,892
Provisions for uncollectible amounts are established based upon the difference between the receivable value
and the estimated net collectible amount. USTER establishes its provision for doubtful accounts receivable
trade based on historical loss experiences.
The effective losses of accounts receivables recognized in 2011 amount to CHF 11,000 (2010: CHF 64,000).
The following table summarizes the movements in the allowance for uncollectible amounts:
in CHF 1,000 Dec 31, 2011 Dec 31, 2010
Balance at January 1 -974 -878
Amounts used 11 64
Reversals 435 347
Increases -601 -511
Translation adjustments -1 4
Balance at December 31 -1,130 -974
The creation and release of the valuation allowance is included in sales deductions in the Statement of
Comprehensive Income.
19 Other Receivables
in CHF 1,000 Dec 31, 2011 Dec 31, 2010
VAT receivables 1,897 1,151
Other financial receivables 585 380
Prepaid expenses 805 597
Total 3,287 2,128
No provision for impairment has been recognized on these balances.
94 Uster Group – Notes to the Consolidated Financial Statements 2011
20 Cash and Cash Equivalents
in CHF 1,000 Dec 31, 2011 Dec 31, 2010
Cash on hand 27 27
Time deposits 719 6,392
Bank accounts 28,070 14,630
Total 28,816 21,049
Cash on bank accounts earns interest at floating rates based on bank deposit rates. Time deposits are made
for varying periods of between one day and three months depending on the immediate cash requirements
of the Uster Group and earn interest at the respective short-term deposit rates.
21 Share Capital and Reserves
21.1 Share Capital
Ordinary Share Capital
The ordinary share capital of Uster Technologies Ltd as of December 31, 2011 amounts to CHF 79.5 million
and is fully paid up. It consists of 8,460,000 registered shares with a nominal value of CHF 9.40 each (Decem-
ber 31, 2010: share capital of CHF 79.5 million and 8,460,000 shares with a nominal value of CHF 9.40 each).
Conditional Share Capital Increase
As of December 31, 2011, Uster Technologies Ltd has a conditional share capital increase available, pursuant
to which the share capital may be increased by a maximum aggregate amount of CHF 7.708 million through
the issuance of a maximum of 820,000 fully paid registered shares with a nominal value of CHF 9.40 each by
the exercise of option rights which the employees, the Management or Directors of Uster Technologies Ltd
or another Group company may be granted.
Part of this conditional share capital increase is used by the share-based payment transaction described in
note 22.
Authorized Share Capital Increase
As of December 31, 2011, Uster Technologies Ltd had an authorized share capital of CHF 17,860,000. Accord-
ing to the articles of association of Uster Technologies Ltd, the Board of Directors is authorized, at any time
until March 30, 2012, to increase the share capital by an amount not to exceed CHF 17,860,000 through the
issuance of up to 1,900,000 fully paid registered shares with a nominal value of CHF 9.40 each. An increase
in partial amounts is permitted.
Development of Ordinary Shares
in 1,000 of shares 2011 2010
Balance at January 1 8,460 8,460
Balance at December 31 8,460 8,460
Uster Group – Notes to the Consolidated Financial Statements 2011 95
21.2 Reserves
Other Reserves
Other reserves include the statutory reserves that have to be allocated from retained earnings based on the
regulations in the jurisdictions of the subsidiaries.
Currency Translation Differences
This reserve contains all currency differences arising from the translation of the financial statements of
foreign subsidiaries as well as from the translation of the intragroup loans that are considered as a part of
the net investment in foreign subsidiaries.
21.3 Dividends
The holders of registered shares are entitled to dividends and to one vote per share at the Shareholders’
meetings of Uster Technologies Ltd. A dividend of CHF 10.2 million (CHF 1.20 / share) was paid out to the
Shareholders in 2011 (2010: none).
22 Share Based Payment Transaction
In May 2010 a Restricted Stock Unit (RSU) Plan has been implemented by the Group. Under this plan, se-
lected employees of the Group have been awarded a fixed number of Restricted Stock Units (RSU Awards)
to purchase registered shares of Uster Technologies Ltd on May 4, 2013 (vesting date) or upon the occurrence
of a change of control at CHF 9.40 per share. The shares (up to 320,000) will be provided out of conditional
share capital. There is no cash settlement of these awards. These awards are forfeited when a participant’s
employment with a member of the Group is terminated before the vesting date (except for the cases of retire-
ment, disability or death). The fair value of the RSUs granted is estimated at the date of grant using the
Black-Scholes pricing model using the following assumptions:
Dividend yield: 0 %
Expected volatility: 50.8 %
Risk-free interest rate: 1.05 %
Expected life: 3 years
Weighted average share price: CHF 22.11
Uster Technologies Ltd is a relatively newly listed company with comparably little trading activity in its
share. In addition, the historical data window available is shorter than the RSUs’ lifetime of 3 years. For the
valuation herein, the historical volatility of the Company’s shares computed over the available price his-
tory. Second, the historical volatility of a predefined peer group is estimated using a time window equal to
the tenor of the RSUs’. Each volatility number is given a 50 % weight.
In 2011, a share-based payment transaction expense of CHF 1,385,000 was recognized as personnel expense
and directly in equity according to the regulations of IFRS 2 (2010: CHF 937,000).
96 Uster Group – Notes to the Consolidated Financial Statements 2011
Movements in the Year
The following table illustrates the number (No.) and weighted average exercise price of, and movements in,
Restricted Stock Units during the year:
in CHF 1,000 Jan 1 –
Dec 31, 2011
Jan 1 –
Dec 31, 2010
No. Weighted
average
Exercise Price
No. Weighted
average
Exercise Price
Outstanding January 1 304,000 9.40 0 0.00
Granted during the year 0 9.40 309,000 9.40
Forfeited during the year -8,500 9.40 -5,000 9.40
Balance at December 31 295,500 9.40 304,000 9.40
Out of the 295,500 outstanding restricted stock units none was exercisable. All 295,500 restricted stock
units will be exercisable on May 4, 2013, and have the exercise price of CHF 9.40 per share.
23 Bank Loans
in CHF 1,000 Dec 31, 2011 Dec 31, 2010
Facility A 39,734 79,625
Facility B 19,734 7,893
Total non-current 59,468 87,518
in CHF 1,000 Dec 31, 2011 Dec 31, 2010
Current portion Facility A 10,000 10,000
Total current 10,000 10,000
Total 69,468 97,518
The bank loans existing as of December 31, 2010 were fully repaid in October 2011. The Group entered into the
following new loan agreements. The relating transaction costs amount to CHF 550,000 and have been capi-
talized within the period.
Facility A
The initial balance of Facility A amounted to CHF 50.0 million and has been reduced by the directly attribut-
able transaction costs that are amortized using the effective interest method. Facility A is unsecured. After
half yearly repayments of CHF 5.0 million in June and December the remaining amount of CHF 5.0 million
has to be repaid in full in October 2016.
Facility B
The initial balance of Facility B amounted to CHF 20.0 million and has been reduced by the directly attribut-
able transaction costs that are amortized using the effective interest method. Facility B is unsecured and
voluntarily repayable. It has to be repaid in full in October 2016.
Uster Group – Notes to the Consolidated Financial Statements 2011 97
The effective interest rate and the maturity of the bank loans are as follows:
Effective Interest Rate Maturity
Facility A Libor + margin % Oct 31, 2016
Facility B Libor + margin % Oct 31, 2016
The margin applicable to the basic Libor interest rate on the bank loans ranges depending on the covenants
from 0.55 % to 1.70 % (2010: 1.0 % to 4.5 %). These covenants focus on equity ratio and on EBITDA.
The Group met all loan covenants.
24 Provisions
in CHF 1,000 Restructuring
Provision
Warranty
Provisions
Other
Provisions
2010
Balance at January 1, 2010 354 1,982 128 2,464Amounts used -8 -537 0 -545Reversals -344 0 0 -344Increases 0 641 2 643Currency translation differences -2 -8 0 -10Balance at December 31, 2010 0 2,078 130 2,208
Thereof Non-current 0 1,323 30 1,353Current 0 755 100 855
in CHF 1,000 Restructuring
Provision
Warranty
Provisions
Other
Provisions
2011
Balance at January 1, 2011 0 2,078 130 2,208Amounts used 0 -1,401 0 -1,401Reversals 0 0 0 0Increases 0 6,546 5 6,551Currency translation differences 0 7 -1 6Balance at December 31, 2011 0 7,230 134 7,364
Thereof Non-current 0 4,729 34 4,763Current 0 2,501 100 2,601
98 Uster Group – Notes to the Consolidated Financial Statements 2011
Warranty Provisions
The Uster Group usually grants a 12-month warranty period for its products. During this period products
will be repaired or replaced free of charge. The provision is on the one hand based on gross sales and past
experience with warranty claims. On the other hand it also considers the Group’s repairs and replacements
made on a voluntary basis towards important clients. The increase in warranty provision in 2011 compared
to 2010 is due to two factors. First, the high increase in sales leads to an increase in warranty provision due
to a percentage calculation. Second, there is an impact of a specific warranty case that is provided for based
on the best estimate made by the executive management team. It is expected that the warranty costs pro-
vided for will be incurred within the next three years.
Other Provisions
Other provisions include provisions with respect to agent contracts. The Group cancelled agent contracts
and paid the open commissions due. Some agents, however, refused to sign a confirmation that all the out-
standing balances are settled. Therefore the estimated possible risks for additional claims have been pro-
vided for.
25 Trade and Other Liabilities
in CHF 1,000 Dec 31, 2011 Dec 31, 2010
Accounts payable trade 4,767 5,770
Advance payments from customers 3,791 2,898
Other financial liabilities 5,494 3,594
Total 14,052 12,262
Accounts payable trade and other liabilities are non-interest-bearing and are generally on 30 to 60 days,
terms. Other liabilities include mostly payables to third parties that are not related to trade activities such
as payables for marketing, consulting activities or IT costs as well as social cost payments.
Uster Group – Notes to the Consolidated Financial Statements 2011 99
26 Accrued Liabilities
in CHF 1,000 Dec 31, 2011 Dec 31, 2010
Compensation related liabilities 9,626 6,590
Sales related liabilities 1,107 996
Liabilities from other operating activities 3,706 3,634
Financial liabilities 2 307
Total 14,441 11,527
Compensation Related Liabilities
This accrual includes liabilities for bonus payments to the employees and the management, overtime, vaca-
tion, social costs, and a length of service compensation.
Sales Related Liabilities
Sales related liabilities include accruals for sales commission or discounts to be paid to agents and clients.
Liabilities from Other Operating Activities
Comprised in this accrual are various liabilities with regards to the operating business such as liabilities
related to consulting, marketing, IT as well as research and development services.
Financial Liabilities
The accrued financial liabilities are mainly related to accrued interest due on bank loans.
27 Operating Lease Commitments
Non-cancellable operating lease rentals are payable as follows:
in CHF 1,000 Jan 1 –
Dec 31, 2011
Jan 1 –
Dec 31, 2010
Up to 1 year 2,871 3,446
2 to 5 years 11,617 3,771
Over 5 years 11,168 0
Total 25,656 7,217
The Group usually leases its premises. The only exception is the facility of Uster Technologies, Inc. in
Knoxville which is owned by the Group. CHF 24.7 million (2010: CHF 5.6 million) of the leasing expense
above is attributable to the non-cancellable rental agreement for the facilities of Uster Technologies Ltd
in Switzerland. The underlying rental agreement has been renewed and the contract period has been ex-
tended.
During the year ended December 31, 2011, CHF 3.1 million was recognized in the Statement of Comprehen-
sive Income as an expense with respect to operating leases (2010: CHF 3.6 million).
100 Uster Group – Notes to the Consolidated Financial Statements 2011
28 Pledged Assets
As of December 31, 2011, none of the assets of the Uster Group have been pledged (2010: none).
29 Related Parties
29.1 Parent and Ultimate Controlling Party
Since October 19, 2007, the shares of Uster Technologies Ltd are listed on the main segment of SIX Swiss Ex-
change. 819 shareholders were entered in the share register of Uster Technologies Ltd as of December 31, 2011
(2010: 880). Of those the following held more than 3.0 % of the total voting rights:
• Toyota Industries Corporation 1) 50.3 % (22.5 %)
• Board and Management Group 2) 8.4 % (8.1 %)
• Alcide Ltd 1) n/a (27.9 %)
• T. Row Price International Inc. n/a (4.5 %)
• Bär Marc Philipp n/a (3.1 %)
• Balfidor Fondsleitung AG n/a (3.1 %)
1) The date of transfer of the equity securities is subject to fulfillment or waiver of closing conditions, not fulfilled
at the balance sheet date. 2) Part of Board and Management formed a Group for purchase and sale of shares.
29.2 Transactions with the Board of Directors and the Executive Committee
Compensation of the Members of the Board of Directors and the Executive Committee
The compensation of the Board of Directors and the Executive Committee comprised the following:
in CHF 1,000 Jan 1 –
Dec 31, 2011
Jan 1 –
Dec 31, 2010
Short-term employee benefits 6,235 5,416
Post-employment benefits 595 571
Share-based payment transactions 903 578
Total 7,733 6,565
In addition to their salaries the Members of the Executive Committee participate in the RSU Plan and have
a company car at their disposal.
For further information regarding the compensation of the Board of Directors and the Executive Committee,
please refer to note 11 Compensation of the Members of the Board of Directors and the Executive Committee
of the Statutory Financial Statements of Uster Technologies Ltd.
Other Transactions with Members of the Board of Directors
In his function of a Managing Partner of a consulting company a Member of the Board of Directors advises
the Company on certain business issues related to China. Also another Board Member delivers consulting
services to the Company from time to time. Consultancy services in the amount of CHF 12,954 (2010:
CHF 43,620) were conducted on the same terms and conditions as if they were delivered by third parties.
Uster Group – Notes to the Consolidated Financial Statements 2011 101
30 Subsidiaries
Company Country of
Incorporation
% Capital
Shareholdings
Dec 31, 2011 Dec 31, 2010
Uster Technologies de Mexico S.A. de C.V. Mexico 100 % 100 %
Uster Technologies GmbH Germany 100 % 100 %
Uster Technologies (India) Pvt. Ltd India 100 % 100 %
Uster Technologies (India) Marketing Pvt. Ltd India 100 % 100 %
Uster Technologies K.K. Japan 100 % 100 %
Uster Technologies (Suzhou) Co. Ltd China 100 % 100 %
Uster Technologies (Shanghai) Trading Co. Ltd China 100 % 100 %
Uster Technologies Sulamericana Ltda. Brazil 100 % 100 %
Uster Technologies (Thailand) Ltd Thailand 100 % 100 %
Uster Technologies Holding (Thailand) Ltd Thailand 100 % 100 %
Uster Technologies, Inc. USA 100 % 100 %
Uster Teknoloji Ticaret A.S. Turkey 100 % 100 %
31 Material Changes since the Balance Sheet Date:
This note contains all information regarding the period between January 1, 2012 and February 17, 2012, the date
this report was authorized for issue.
On November 7, 2011, Toyota Industries Corporation, at that time holding 28.46 % of the share capital of Uster Tech-
nologies Ltd, entered into an agreement to purchase an additional stake of 1,850,777 shares of Uster Technologies
Ltd, corresponding to 21.88 % of the issued and outstanding shares of Uster Technologies Ltd, from Alcide Limited.
On November 8, 2011, Toyota Industries Corporation made a preliminary announcement of a public tender offer at
CHF 38.00 per share for all publicly held registered shares of Uster Technologies Ltd. On February 9, 2012, Toyota
Industries Corporation announced that all required merger control approvals for the closing were obtained and
that after the closing of the transaction mentioned above the mandatory public tender offer to acquire all publicly
held Uster shares will be launched with the publication of the offer prospectus on or about February 29, 2012.
This closing of the agreement between Toyota Industries Corporation and Alcide Limited will have the fol-
lowing impact on the Consolidated Financial Statements 2012:
Bank Loans
Pursuant to the change of control clause of the main credit facility agreement of the Company the lenders
have the right to cancel all facilities under the facility agreement and to ask for immediate repayment of the
outstanding amounts. At the date these Financial Statements were authorized the lenders had agreed to
suspend the handling of the change of control event for a reasonable period of time.
Share Based Payment Transaction
Pursuant to the change of control clause of the Restricted Stock Unit Plan described in note 22 the plan will
vest if a shareholder holds more than 51 % of the voting rights in the Company. As it is highly probable that
Toyota Industries Corporation will hold more than 51 % of the shares of the Company following the settlement
of the public tender offer, the remaining share-based payment transaction expense of CHF 2.0 million (2012
and 2013) will have to be fully recognized upon vesting.
102 Report of the Statutory Auditor on the Consolidated Financial Statements 2011
Report of the Statutory Auditor on the Consolidated Financial Statements
To the General Meeting of Uster Technologies Ltd, Uster
Zurich, 17 February 2012
As statutory auditor, we have audited the consolidated financial statements of Uster Technologies Ltd, which
comprise the statement of comprehensive income, statement of financial position, statement of cash flows,
statement of changes in equity and notes (pages 54 to 101), for the year ended 31 December 2011.
Board of Directors, responsibility
The Board of Directors is responsible for the preparation and fair presentation of the consolidated financial
statements in accordance with International Financial Reporting Standards (IFRS) and the requirements of
Swiss law. This responsibility includes designing, implementing and maintaining an internal control system
relevant to the preparation and fair presentation of consolidated financial statements that are free from
material misstatement, whether due to fraud or error. The Board of Directors is further responsible for
selecting and applying appropriate accounting policies and making accounting estimates that are reasonable
in the circumstances.
Auditor’s responsibility
Our responsibility is to express an opinion on these consolidated financial statements based on our audit.
We conducted our audit in accordance with Swiss law and Swiss Auditing Standards and International Stan-
dards on Auditing (ISA). Those standards require that we plan and perform the audit to obtain reasonable
assurance whether the consolidated financial statements are free from material misstatement.
An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the
consolidated financial statements. The procedures selected depend on the auditor’s judgment, including
the assessment of the risks of material misstatement of the consolidated financial statements, whether due
to fraud or error. In making those risk assessments, the auditor considers the internal control system relevant
to the entity’s preparation and fair presentation of the consolidated financial statements in order to design
audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion
on the effectiveness of the entity’s internal control system. An audit also includes evaluating the appropri-
ateness of the accounting policies used and the reasonableness of accounting estimates made, as well as
evaluating the overall presentation of the consolidated financial statements. We believe that the audit
evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion.
Opinion
In our opinion, the consolidated financial statements for the year ended 31 December 2011 give a true and fair
view of the financial position, the results of operations and the cash flows in accordance with IFRS and
comply with Swiss law.
Report of the Statutory Auditor on the Consolidated Financial Statements 2011 103
Report on other legal requirements
We confirm that we meet the legal requirements on licensing according to the Auditor Oversight Act (AOA)
and independence (Art. 728 CO and Art. 11 AOA) and that there are no circumstances incompatible with our
independence.
In accordance with article 728a paragraph 1 item 3 CO and Swiss Auditing Standard 890, we confirm that an
internal control system exists, which has been designed for the preparation of consolidated financial state-
ments according to the instructions of the Board of Directors.
We recommend that the consolidated financial statements submitted to you be approved.
Ernst & Young Ltd
Daniel Zaugg Tobias Meyer
Licensed audit expert Licensed audit expert
(Auditor in charge)
Uster Technologies Ltd – Financial Statements 2011 105
Uster Technologies Ltd – Financial Statements
Income Statement
in CHF 1,000 Jan 1 –
Dec 31, 2011
Jan 1 –
Dec 31, 2010
Gross sales 177,069 116,513
Sales deductions -11,031 -3,285
Net sales 166,038 113,228
Other operating income 3,825 4,049
Operating income 169,863 117,277
Material expense -43,636 -37,061
Personnel expense -32,595 -23,447
Depreciation and amortization -15,822 -15,066
Other operating expense -35,404 -21,255
Operating expense -127,457 -96,829
Earnings before interest and tax (EBIT) 42,406 20,448
Finance income 2,413 1,955
Finance expense -3,817 -6,826
Finance result -1,404 -4,871
Earnings before tax 41,002 15,577
Taxes -4,158 -797
Profit / (Loss) of the year 36,844 14,780
106 Uster Technologies Ltd – Financial Statements 2011
Balance Sheet
in CHF 1,000 Dec 31, 2011 Dec 31, 2010
Organizational costs 3,394 6,254
Other intangible assets 266,434 276,593
Property, plant and equipment 7,620 6,546
Financial assets 29 14
Investments in subsidiaries 6,645 5,825
Loans to group companies 503 612
Non-current assets 284,625 295,844
Inventories 5,532 5,181
Receivables trade third parties 16,778 12,496
Receivables trade group companies 8,974 5,812
Other receivables third parties 1,585 1,225
Other receivables group companies 2,321 1,430
Prepaid expenses third parties 573 474
Prepaid expenses group companies 56 70
Cash and cash equivalents 24,757 17,026
Current assets 60,576 43,714
Assets 345,201 339,558
Share capital 79,524 79,524
Reserve from capital contribution 99,859 110,011
Statutory reserve 422 422
Retained earnings 18,108 3,327
Net result 36,844 14,780
Shareholders’ equity 234,757 208,064
Bank loans 60,000 88,000
Provisions 4,729 1,323
Non-current liabilities 64,729 89,323
Bank loans 10,000 10,000
Derivative financial instruments 0 1,134
Payables trade third parties 6,323 7,136
Payables trade group companies 1,295 381
Other liabilities third parties 5,310 2,785
Other liabilities group companies 7,992 4,798
Accrued liabilities third parties 12,161 14,975
Accrued liabilities group companies 170 200
Provisions 2,464 762
Current liabilities 45,715 42,171
Liabilities 110,444 131,494
Shareholders’ equity and l i a b i l i t i e s 345,201 339,558
Uster Technologies Ltd – Notes to the Financial Statements 2011 107
Uster Technologies Ltd – Notes to the Financial Statements
1 Statement of Compliance
The financial statements of Uster Technologies Ltd are prepared in compliance with the Swiss Code of
Obligations.
2 Company Information
Since the initial public offering on October 19, 2007, the shares of Uster Technologies Ltd are listed on the
main standard of SIX Swiss Exchange.
3 Shareholders’ Equity
in CHF 1,000 Share
Capital
Reserve from
Capital
Contribution
Statutory
Reserves
Retained
Earnings 1)
Total
Balance at January 1, 2010 79,524 110,011 422 3,327 193,284Profit / (Loss) of the year 14,780 14,780Balance at December 31, 2010 79,524 110,011 422 18,107 208,064
Balance at January 1, 2011 79,524 110,011 422 18,107 208,064Appropriation of retained earnings 0 -10,152 0 10,152 0Dividend 0 0 0 -10,152 -10,152Profit / (Loss) of the year 0 0 0 36,844 36,844Balance at December 31, 2011 79,524 99,859 422 54,952 234,757
Ordinary Share Capital
The ordinary share capital of Uster Technologies Ltd as of December 31, 2011, amounts to CHF 79.5 million
and is fully paid up. It consists of 8,460,000 registered shares with a nominal value of CHF 9.40 each
(December 31, 2010: share capital of CHF 79.5 million and 8,460,000 shares with a nominal value of
CHF 9.40 each).
Conditional Share Capital Increase
As of December 31, 2011, Uster Technologies Ltd has a conditional share capital increase available, pursuant
to which the share capital may be increased by a maximum aggregate amount of CHF 7.708 million through
the issuance of a maximum of 820,000 fully paid registered shares with a nominal value of CHF 9.40 each by
the exercise of option rights which the employees, the Management or Directors of Uster Technologies Ltd
or another Group company may be granted.
Part of this conditional share capital increase is used by the share-based payment transaction described in
note 22 of the Consolidated Financial Statements.
108 Uster Technologies Ltd – Notes to the Financial Statements 2011
Authorized Share Capital Increase
As of December 31, 2011, Uster Technologies Ltd had an authorized share capital of CHF 17,860,000. Accord-
ing to the articles of association of Uster Technologies Ltd, the Board of Directors is authorized, at any time
until March 30, 2012, to increase the share capital by an amount not to exceed CHF 17,860,000 through the
issuance of up to 1,900,000 fully paid registered shares with a nominal value of CHF 9.40 each. An increase
in partial amounts is permitted.
4 Pledged Assets
As of December 31, 2011, none of the assets of Uster Technologies Ltd were pledged (2010: none).
5 Guarantee
As of December 31, 2011, Uster Technologies Ltd did not have any guarantees outstanding (2010: none).
6 Fire Insurance Values of Property, Plant and Equipment
The fire insurance values of property, plant and equipment as of December 31, 2011, amounted to CHF 18.9 mil-
lion (2010: CHF 17.1 million).
7 Pension Fund Liability
As of December 31, 2011, Uster Technologies Ltd had no pension fund liability (2010: CHF 0.3 million).
8 Risk Assessment
Risk management is part of the management process which is defined within the management handbook.
All risks / groups of risks are assigned to the process owners of the business processes containing the spe-
cific risk. Strategic risks are directly assigned to the Executive Management Team.
The process owners supervise the risks / group of risks and propose process changes if the risks take unex-
pected developments. The process changes are approved by the Executive Management Team.
The risk management process is reviewed at least once a year by the Board of Directors.
9 Significant Shareholders
819 shareholders were entered in the share register of Uster Technologies Ltd as of December 31, 2011
(2010: 880). Of those the following held more than 3.0 % of the total voting rights:
• Toyota Industries Corporation 1) 50.3 % (22.5 %)
• Board and Management Group 2) 8.4 % (8.1 %)
• Alcide Ltd 1) n / a (27.9 %)
• T. Row Price International Inc. n / a (4.5 %)
• Bär Marc Philipp n / a (3.1 %)
• Balfidor Fondsleitung AG n / a (3.1 %)
1) The date of transfer of the equity securities is subject to fulfillment or waiver of closing conditions, not fulfilled
at the balance sheet date. 2) Part of Board and Management formed a Group for purchase and sale of shares.
Uster Technologies Ltd – Notes to the Financial Statements 2011 109
10 Investments in Subsidiaries
As of December 31, 2011, Uster Technologies Ltd held the following investments:
Company Purpose % Capital
Shareholdings
Share Capital
Dec 31, 2011 in 1,000
Uster Technologies de Mexico S.A. de C.V.
(Tlalnepantla, MX)
D 100 % MXN 6,250
Uster Technologies GmbH
(Neuss, DE)
D 100 % EUR 26
Uster Technologies (India) Pvt. Ltd
(Bangalore, IN)
SC 100 % INR 4,950
Uster Technologies (India) Marketing Pvt. Ltd
(Bangalore, IN)
S 100 % I N R 100
Uster Technologies K.K.
(Osaka-fu, JP)
SC 100 % JPY 10,000
Uster Technologies (Shanghai) Trading Co. Ltd
(Shanghai, CN)
S 100 % CNY 5,654
Uster Technologies (Suzhou) Co. Ltd
(Suzhou, CN)
TC 100 % CNY 20,185
Uster Technologies Sulamericana Ltda.
(Alphaville-Barueri SP, BR)
SC 100 % BRL 523
Uster Technologies (Thailand) Ltd
(Bangkok, TH)
SC 100 % THB 6,000
Uster Technologies Holding (Thailand) Ltd
(Bangkok, TH)
H 100 % THB 1,000
Uster Technologies, Inc.
(Knoxville, US)
TC 100 % USD 100
Uster Teknoloji Ticaret A.S.
(Adana, TR)
SC 100 % TRY 50
TC: Technology Center
SC: Service Center
S: Sales Office
H: Holding
D: Dormant
110 Uster Technologies Ltd – Notes to the Financial Statements 2011
11 Compensation of the Members of the Board of Directors and the Executive Committee
11.1 Loans and Other Payments
No loans to present or former Members of the Board of Directors or Executive Committee were granted or
outstanding as of December 31, 2011 (2010: none).
During 2011 payments for consulting services amounting to CHF 12,954 (2010: CHF 43,620) have been made
to Pacific Consult Ltd of which Max-Ulrich Zellweger is a Managing Partner.
11.2 Compensation
The compensation of the Board of Directors and the Executive Committee for the year ending Decem-
ber 31, 2011, was as follows:
Board of Directors
in CHF 2010
Name Function Base
Compensation
(Cash)
Bonus
(Cash)
Share-based
Payment
Transaction
Other
Social Costs
Total
Max-Ulrich Zellweger Chairman 80,000 0 209,550 4,000 293,550Beat Lüthi 1) Vice-Chairman 0 0 0 0 0Harald Rönn Member 0 0 0 0 0Barry James Mulady Member 50,000 0 104,775 3,125 157,900Akira Onishi 2 ) Member 0 0 0 0 0Geoffrey Scott 3) Member
Total 130,000 0 314,325 7,125 451,450
in CHF 2011
Name Function Base
Compensation
(Cash)
Bonus
(Cash)
Share-based
Payment
Transaction
Other
Social Costs
Total
Max-Ulrich Zellweger Chairman 80,000 0 0 4,064 84,064Harald Rönn 4) Vice-Chairman 0 0 0 0 0Barry James Mulady Member 50,000 0 0 3,175 53,175Akira Onishi Member 0 0 0 0 0Geoffrey Scott 3) Member Total 130,000 0 0 7,239 137,239
1) Beat Lüthi left the Board of Directors at the Ordinary General Meeting held on March 30, 2010.2) Akira Onishi was elected Member of the Board of Directors by the Ordinary General Meeting held on March 30, 2010.3) The compensation of the executive member of the Board of Directors is shown under the compensation
of the Executive Committee.4) Harald Rönn left the Board of Directors on June 30, 2011.
Uster Technologies Ltd – Notes to the Financial Statements 2011 111
Executive Committee
in CHF 2010
Name Function Base
Compensation
(Cash)
Bonus
(Cash)
Share-based
Payment
Transaction
Pension
Benefits
Other
Social Costs
Total
Geoffrey Scott CEO 555,923 562,731 488,950 78,676 73,930 1,760,210Other members 2,258,028 1,909,397 1,816,100 179,168 232,477 6,395,170Total 2,813,951 2,472,128 2,305,050 257,844 306,407 8,155,380
in CHF 2011
Name Function Base
Compensation
(Cash)
Bonus
(Cash)
Share-based
Payment
Transaction
Pension
Benefits
Other
Social Costs
Total
Geoffrey Scott CEO 576,720 745,748 0 84,982 87,923 1,495,373Other members 2,189,098 2,723,350 429,400 180,868 241,076 5,763,792Total 2,765,818 3,469,098 429,400 265,850 328,999 7,259,165
1) Including board member fee of CHF 50,000 (2010: CHF 50,000).
11.3 Ownership of USTER Shares by the Board of Directors and the Executive Committee
As of December 31, 2011, the Members of the Board of Directors and the Executive Committee held the
following number of shares of Uster Technologies Ltd:
Board of Directors
Name Function Number of
Shares owned
2011
Number of
Restricted
Stock Units
owned 2011
Number of
Shares owned
2010
Number of
Restricted
Stock Units
owned 2010
Max-Ulrich Zellweger Chairman 40,000 15,000 40,000 15,000
Harald Rönn 1) Vice-Chairman n / a n / a 13,000 0
Barry James Mulady Member 10,148 7,500 10,148 7,500
Akira Onishi 2) Member 0 0 0 0
Geoffrey Scott 3) Member
Total 50,148 22,500 63,148 22,500
1) Harald Rönn left the Board of Directors on June 30, 2011.2) Akira Onishi was elected Member of the Board of Directors by the Ordinary General Meeting held on March 30,
2010.3) The ownership of shares of the executive member of the Board of Directors is shown under the ownership of shares
of the Executive Committee.
1)
1)
112 Uster Technologies Ltd – Notes to the Financial Statements 2011
Executive Committee
Name
Function
Number of Shares owned
2011
Number of Restricted
Stock Units owned 2011
Number of Shares owned
2010
Number of Restricted
Stock Units owned 2010
Geoffrey Scott CEO 239,848 35,000 235,193 35,000
Thomas Dressendörfer 1) CFO n / a n / a 17,500 25,000
Naiming Wei Asian Operations 131,172 15,000 106,000 15,000
Harold Hoke Sales & Service 92,000 15,000 92,000 15,000
Hossein Ghorashi U.S. Operations 75,000 15,000 75,000 15,000
Renato Murk Order Fulfillment 73,400 15,000 73,400 15,000
Rafael Storz Research & Innovation 34,100 10,000 32,000 10,000
Richard Furter 2) Textile Technology n / a n / a 5,000 25,000
Thomas Nasiou 3) Textile Technology 0 10,000 n / a n / a
Deniz Bütüner 4) Marketing & Business Development
n / a n / a 7,000 10,000
Reine Wasner 5) Marketing & Business Development
3,700 10,000 n / a n / a
Total 649,220 125,000 643,093 165,000
1) Thomas Dressendörfer left the Executive Committee on October 31, 2011.2) Richard Further left the Executive Committee on May 31, 2011.3) Thomas Nasiou joined the Executive Committee on June 1, 2011.4) Deniz Bütüner left the Executive Committee on December 31, 2010.5) Reine Wasner joined the Executive Committee on January 3, 2011.
Proposal for the Appropriation of Available Earnings and Capital Reserve
The Board of Directors proposes to appropriate the available earnings and capital reserve as follows:
in CHF Dec 31, 2011 Dec 31, 2010
Unappropriated retained earningsBalance brought forward 18,107,655 3,327,208
Profit/(Loss) of the year 36,844,654 14,780,447
Total unappropriated retained earnings 54,952,309 18,107,655
Appropriation of retained earningsUnappropriated retained earnings 54,952,309 18,107,655
Transfer of reserve from capital contribution 21,150,000 10,152,000
Total available for distribution 76,102,309 28,259,655Dividend proposed by the Board of Directors -21,150,000 -10,152,000
Unappropriated retained earnings to be carried forward 54,952,309 18,107,655
in CHF Dec 31, 2011 Dec 31, 2010
Reserve from capital contributionBalance brought forward 99,859,000 110,011,000
Transfer to retained earnings -21,150,000 -10,152,000
Balance to be carried forward 78,709,000 99,859,000
Report of the Statutory Auditor on the Financial Statements 2011 113
Report of the Statutory Auditor on the Financial Statements
To the General Meeting of Uster Technologies Ltd, Uster
Zurich, 17 February 2012
As statutory auditor, we have audited the financial statements of Uster Technologies Ltd, which comprise
the income statement, balance sheet and notes (pages 105 to 112), for the year ended 31 December 2011.
Board of Directors’ responsibility
The Board of Directors is responsible for the preparation of the financial statements in accordance with the
requirements of Swiss law and the company’s articles of incorporation. This responsibility includes design-
ing, implementing and maintaining an internal control system relevant to the preparation of financial state-
ments that are free from material misstatement, whether due to fraud or error. The Board of Directors is
further responsible for selecting and applying appropriate accounting policies and making accounting
estimates that are reasonable in the circumstances.
Auditor’s responsibility
Our responsibility is to express an opinion on these financial statements based on our audit. We conducted
our audit in accordance with Swiss law and Swiss Auditing Standards. Those standards require that we plan
and perform the audit to obtain reasonable assurance whether the financial statements are free from
material misstatement.
An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the
financial statements. The procedures selected depend on the auditor’s judgment, including the assessment
of the risks of material misstatement of the financial statements, whether due to fraud or error. In making
those risk assessments, the auditor considers the internal control system relevant to the entity’s preparation
of the financial statements in order to design audit procedures that are appropriate in the circumstances,
but not for the purpose of expressing an opinion on the effectiveness of the entity’s internal control system.
An audit also includes evaluating the appropriateness of the accounting policies used and the reasonableness
of accounting estimates made, as well as evaluating the overall presentation of the financial statements. We
believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit
opinion.
Opinion
In our opinion, the financial statements for the year ended 31 December 2011 comply with Swiss law and the
company’s articles of incorporation.
114 Report of the Statutory Auditor on the Financial Statements 2011
Report on other legal requirements
We confirm that we meet the legal requirements on licensing according to the Auditor Oversight Act (AOA)
and independence (Art. 728 CO and Art. 11 AOA) and that there are no circumstances incompatible with our
independence.
In accordance with article 728a paragraph 1 item 3 CO and Swiss Auditing Standard 890, we confirm that an
internal control system exists, which has been designed for the preparation of financial statements accord-
ing to the instructions of the Board of Directors.
We further confirm that the proposed appropriation of available earnings complies with Swiss law and the
company’s articles of incorporation. We recommend that the financial statements submitted to you be
approved.
Ernst & Young Ltd
Daniel Zaugg Tobias Meyer
Licensed audit expert Licensed audit expert
(Auditor in charge)
Information for Investors 2011 115
Information for Investors
Share Information
Development of Share Price in CHF
Share Information and Key Figures
The table below shows the most important information regarding the shares of Uster Technologies Ltd.
2011 2010
Share capitalNominal value per share CHF 9.40 9.40
Shares issued number 8,460,000 8,460,000
Issued share capital CHF 1,000 79,524 79,524
Free float 49.6 % 49.6 %
Market capitalization and dividendMarket capitalization CHF 1,000 348,552 271,989
as % of gross sales 181.1 % 204.7 %
as % of shareholders’ equity 138.2 % 121.1 %
Dividend per share, gross CHF 2.50 1.20
Total dividend, gross CHF 1,000 21,150 10,152
Payout ratio 58.4 % 48.9 %
40
45
35
30
25
20
Uster Technologies Ltd
SPI, rebased31
.10.
2011
30.1
1.20
11
31.0
8.20
11
30.0
6.20
11
30.0
4.20
11
31.0
5.20
11
31.0
7.20
11
30.0
9.20
11
28.0
2.20
11
31.0
3.20
11
31.1
2.20
10
31.0
1.20
11
31.1
2.20
11
31.0
1.20
12
116 Information for Investors 2011
2011 2010
Key figures per shareShare price at the end of the year CHF 41.20 32.15
Highest share price CHF 42.80 33.20
Lowest share price CHF 27.80 22.50
Dividend yield 6.1 % 3.7 %
Basic earnings per share CHF 4.28 2.45
Diluted earnings per share CHF 4.20 2.44
P / E ratio 9.6 13.1
Stock Exchange Information
SIX Swiss Exchange Ticker Symbol USTN
Swiss Security Number 3433153
ISIN CH0034331535
Shareholding Structure
The structure of the shareholders entered in the share register is as follows:
Shares Shareholders Shares
1 – 100 283 34.6 % 18,078 0.2 %
101 – 1,000 422 51.5 % 156,762 1.9 %
1,001 – 10,000 76 9.3 % 235,052 2.8 %
10,001 – 100,000 31 3.8 % 1,067,790 12.6 %
100,001 – 1,000,000 5 0.6 % 1,074,081 12.7 %
> 1,000,000 2 0.2 % 4,258,377 50.4 %
Not registered 1,649,860 19.5 %
Total 819 100.0 % 8,460,000 100.0 %
Important Dates
Publication of annual results 2011 February 21, 2012
Media and analyst conference February 21, 2012
Last day for inscription into the share register
before the Shareholders’ meeting 2012
April 5, 2012
Shareholders’ meeting 2012 April 12, 2012
Dividend payment April 19, 2012
Semiannual results 2012 July 17, 2012
Contact for Media, Investors and Analysts
Peter Huber, CFO
Uster Technologies AG
Sonnenbergstrasse 10
CH-8610 Uster
Phone +41 43 366 36 06
Fax +41 43 366 36 54
Email [email protected]
Information for Investors 2011 117
Key Figures
in CHF 1,000 Jan 1 –
Dec 31, 2011
Jan 1 –
Dec 31, 2010
Jan 1 –
Dec 31, 2009
Jan 1 –
Dec 31, 2008
Consolidated Income StatementGross sales 192,510 100.0 % 132,841 100.0 % 100,763 100.0 % 154,893 100.0 %
Sales deductions -4,361 -2,746 -2,858 -1,925
Net sales 188,149 97.7 % 130,095 97.9 % 97,905 97.2 % 152,968 98.8 %
Cost of goods sold -68,348 -35.5 % -52,978 -39.9 % -41,631 -41.3 % -61,952 -40.0 %
Gross profit 119,801 62.2 % 77,117 58.1 % 56,274 55.8 % 91,016 58.8 %
Sales and marketing
expenses
-23,129 -12.0 % -14,274 -10.7 % -11,750 -11.7 % -19,465 -12.6 %
Research and develop-
ment expenses
-18,174 -9.4 % -14,916 -11.2 % -11,010 -10.9 % -19,857 -12.8 %
Management and admin-
istrative expenses
-22,032 -11.4 % -13,418 -10.1 % -11,245 -11.2 % -17,582 -11.4 %
Other income, expenses &
amortization
-15,106 -7.8 % -15,078 -11.4 % -14,812 -14.7 % -15,212 -9.8 %
Earnings before interest and tax (EBIT)
41,360 21.5 % 19,431 14.6 % 7,457 7.4 % 18,900 12.2 %
Amortization 15,275 15,171 15,252 15,268
Earnings before interest tax and amortization (EBITA)
56,635 29.4 % 34,602 26.0 % 22,709 22.5 % 34,168 22.1 %
Amortization -15,275 -15,171 -15,252 -15,268
Earnings before interest and tax (EBIT)
41,360 21.5 % 19,431 14.6 % 7,457 7.4 % 18,900 12.2 %
Finance result -1,713 -0.9 % -5,137 -3.9 % -7,044 -7.0 % -10,211 -6.6 %
Earnings before tax 39,647 20.6 % 14,294 10.8 % 413 0.4 % 8,689 5.6 %
Income tax -3,410 -8.6 % 6,469 45.3 % 665 161.0 % -3,373 -38.8 %
Profit / (Loss) of the year 36,237 18.8 % 20,763 15.6 % 1,078 1.1 % 5,316 3.4 %
118 Information for Investors 2011
in CHF 1,000 Jan 1 –
Dec 31, 2011
Jan 1 –
Dec 31, 2010
Jan 1 –
Dec 31, 2009
Jan 1 –
Dec 31, 2008
Consolidated Cash Flow StatementEarnings before tax 39,647 14,294 413 8,689
Finance result 1,713 5,137 7,044 10,211
Amortization, depreciation &
change in accruals / provision
25,342 20,378 12,872 20,729
Change in working capital -4,320 2,859 -3,640 -2,256
Income taxes paid -8,365 -23 -2,411 -4,617
Cash flow from operating activities 54,017 42,645 14,278 32,756
Purchase of non-current assets -5,119 -3,808 -3,373 -3,735
Disposal of non-current assets 127 77 298 124
Interest received 157 97 75 264
Cash flow from / (used in) investing activities -4,835 -3,634 -3,000 -3,347
Proceeds from loans 69,450 0 5,000 1
Repayments of loans -98,000 -27,000 -45,000 -15,000
Share capital transactions 0 0 42,631 -3,936
Dividends paid -10,152 0 0 0
Interest paid -2,608 -5,729 -6,646 -8,478
Cash flow from / (used in) financing activities -41,310 -32,729 -4,015 -27,413Net change in cash and cash equivalents 7,872 6,282 7,263 1,996
Cash flow from operating activities in % of EBITA 95.4 % 123.2 % 62.9 % 95.9 %
Information for Investors 2011 119
in CHF 1,000 2011 2010 2009 2008
Balance sheetAssets 403,652 399,454 404,739 409,805
Non-current assets 332,355 345,233 361,269 375,321
as % of total assets 82.3 % 86.4 % 89.3 % 91.6 %
Current assets 71,297 54,221 43,470 34,484
as % of total assets 17.7 % 13.6 % 10.7 % 8.4 %
Equity 252,210 224,658 203,607 159,542
as % of total assets 62.5 % 56.2 % 50.3 % 38.9 %
Liabilities 151,442 174,796 201,132 250,263
Non-current liabilities 105,498 131,231 165,692 215,174
as % of total assets 26.1 % 32.9 % 40.9 % 52.5 %
Current liabilities 45,944 43,565 35,440 35,089
as % of total assets 11.4 % 10.9 % 8.8 % 8.6 %
Net debt 40,652 76,469 109,224 156,546
AR collection period 42 48 53 35
AP collection period 50 42 41 48
Capital expenditureIntangible assets -608 -377 -9 -174
Property, plant, and equipment -4,464 -3,408 -3,319 -3,513
Total -5,072 -3,785 -3,328 -3,687
EmployeesNumber of employees (FTE) 498 445 449 536
Gross sales per employee 386,566 298,251 224,416 288,979
Imprint
Content Concept and Editing
IRF Communications AG
Text
Uster Technologies Ltd
Design, Concept and Layout
TGG Hafen Senn Stieger
Photos Imagepages
Vonier Fotografie
Photos Board of Directors
and Executive Committee
T+T Fotografie
Printing
Ostschweiz Druck AG
Uster Technologies Ltd
Sonnenbergstrasse 10
CH-8610 Uster / Switzerland
Phone +41 43 366 36 36
Fax +41 43 366 36 37
Email [email protected]
The English reporting section of this annual report is the governing text.
Die englische Version des Berichterstattungsteils ist massgeblich.