Zehnder Group divests Climate Ceiling Solutions business

• The non-core Climate Ceiling Solutions business has been loss-making in recent years
• Private Assets takes over German Climate Ceiling Solutions unit
• One-off loss of about EUR 10 million (mostly cash neutral) expected
• Continued focus on execution of strategy in core businesses
• Outlook for the first half of 2024: Sales decline in the mid-teen percentage range and an EBIT margin before one-off effects of 6-7 %

Graenichen (CH), 16 May 2024: Zehnder Group (SIX: ZEHN), a leading international provider of complete solutions for a comfortable, energy-efficient and healthy indoor climate, is divesting its Climate Ceiling Solutions business. An agreement on the sale of the Climate Ceiling Solutions unit in Germany (Zehnder Climate Ceiling Solutions GmbH) was reached with Private Assets SE & Co. KGaA (Private Assets). In addition, Zehnder Group also intends to sell its Climate Ceiling Solutions unit in France (Zehnder Climate Ceiling Solutions SAS) to Private Assets. The two companies Climate Ceiling Solutions in Germany and France, formerly part of the radiator segment, were carved out into separate legal entities and have since been managed as independent business units. The business area of Radiant Ceiling Panels for heating and cooling is not part of the transaction and will remain with Zehnder Group.

Due to the specific business model of Climate Ceiling Solutions and its pronounced project orientation, the Board of Directors of Zehnder Group has decided to divest this non-core asset. Overall, Climate Ceiling Solutions generated revenue of around EUR 23 million in 2023 and employed a total of 75 people but has been loss-making in recent years. Closing of the transaction is subject to closing conditions and a prior employee information in France, which is customary for such transactions. The transaction will result in a one-off loss of about EUR 10 million (mostly cash neutral).

Matthias Huenerwadel, CEO of Zehnder Group said: “With Private Assets, Climate Ceiling Solutions has found a suitable owner to unfold its full potential and add value for all stakeholders. The conclusion of this agreement confirms the consistent execution of our strategy. At Zehnder we aim to further grow in our core businesses in alignment with our strategic priorities.”

Climate Ceiling Solutions offers its customers advice, planning and realisation of climate ceilings. Climate ceilings can be applied in a wide range of commercial and industrial building applications. The business is a leading supplier and partner with an outstanding service offering. Private Assets is an investment company that focuses on the sustainable optimisation of companies from corporate spin-offs and special situations.

Outlook for the first half of 2024

Weak construction activity and after-effects of a derailed supply chain situation continue in many markets, with both the ventilation and radiator segment still faced with lower demand. Zehnder Group therefore expects a sales decline in the mid-teen percentage range and an EBIT margin before one-off effects of 6 - 7 % for the first half of 2024. The divestment of the non-core Climate Ceiling Solutions business accounts for a one-off loss of EUR 10 million. In addition, we expect further restructuring costs of EUR 2 - 3 million in Europe in the areas of production and sales.

Zehnder Group maintains a favorable outlook on its long-term growth prospects. The backlog in new construction and renovation activities, new building regulations for better insulated buildings, the increasing demand for energy-saving and efficient climate solutions, and the desire for healthy indoor air quality, together with increasing penetration rates in various countries, will favour growth, particularly in the ventilation sector.

Next dates to note

Contact

René Grieder
Member of the Group Executive Committee, CFO
Zehnder Group AG, 5722 Gränichen (Switzerland)
T +41 62 855 15 21, rene.grieder@zehndergroup.com

Alexander Kamb
Senior Manager Investor Relations & Communications
Zehnder Group AG, 5722 Gränichen (CH)
T +41 62 855 15 36, alexander.kamb@zehndergroup.com

This media release is published in German and English. The German version is binding. For further information about the Zehnder Group, please visit www.zehndergroup.com.

Company profile

Zehnder Group provides worldwide leading solutions for a comfortable, energy-efficient and healthy indoor climate. The products and services of the Group include heating, cooling, indoor ventilation and air cleaning. The Group develops and manufactures its products at its own factories in Europe, China, and North America. In the financial year of 2023, the Zehnder Group had about 3500 employees and achieved sales of EUR 762 million. The company is listed on the SIX Swiss Exchange (symbol: ZEHN, number: 27 653 461). The unlisted registered shares B are held by Graneco AG, which is controlled by the Zehnder families.

About Private Assets SE & Co. KGaA

Private Assets SE & Co. KGaA (Private Assets) is a Hamburg-based investment company specialising in majority takeovers of companies in special situations. Private Assets prefers to invest in corporate spin-offs and medium-sized companies that are currently underperforming as well as companies with unresolved succession planning. Thanks to the management's many years of experience and a proven track record in the development of companies in special situations, the investments are organised efficiently and profitably on a sustainable basis. To ensure the necessary rapid implementation, the company has its own in-house consulting task force that provides operational support in areas such as product supply, project management, sales & marketing, legal and finance and explicitly promotes digitalisation topics with the Digital Group. Thanks to the close operational support and active management provided by the shareholders, Private Assets SE & Co. KGaA achieves rapid, efficient, and sustainable changes in its investments.

The shares of Private Assets SE & Co. KGaA are traded on the open market of the Berlin Stock Exchange under the securities identification number A3H223. Further information can be found at www.private-assets.de.

Cautionary note regarding forward-looking statements

This media release may contain certain forward-looking statements relating to Zehnder Group’s future business, development, and economic performance. Such statements may be subject to a number of risks, uncertainties and other important factors, such as but not limited to force majeure, competitive pressures, legislative and regulatory developments, global, macroeconomic and political trends, Zehnder Group’s ability to attract and retain the employees that are necessary to generate revenues and to manage its businesses, fluctuations in currency exchange rates and general financial market conditions, changes in accounting standards or policies, delay or inability in obtaining approvals from authorities, technical developments, litigation or adverse publicity and news coverage, each of which could cause actual development and results to differ materially from the statements made in this media release. Zehnder Group assumes no obligation to update or alter forward-looking statements whether as a result of new information, future events or otherwise.