Semperit AG Holding

Interim / Quarterly Report • Aug 14, 2019

Key performance figures

in EUR million	H1 2019	Change	H1 2018	Q2 2019	Change	Q2 2018	2018
Revenue	437.3	–2.5%	448.5	224.4	–1.4%	227.6	878.5
EBITDA	39.1	+35.5%	28.9	22.7	+72.7%	13.1	46.4
EBITDA margin	9.0%	+2.6 PP	6.4%	10.1%	+4.3 PP	5.8%	5.3%
EBIT	20.9	–	–49.8	13.1	–	–55.8	–47.7
EBIT margin	4.8%	+15.9 PP	–11.1%	5.8%	+30.3 PP	–24.5%	–5.4%
Earnings after tax	5.8	–	–67.4	2.6	–	–64.8	–80.4
Earnings per share (EPS)1), in EUR	0.28	–	–3.33	0.13	–	–3.19	–4.13
Gross cashflow	31.5	+40.6%	22.4	15.5	+61.5%	9.6	37.4
Return on equity2)	3.4%	+42.2 PP	–38.8%	–0.4%	+74.0 PP	–74.4%	–24.2%

Balance sheet key figures

in EUR million	30.06.2019	Change	30.06.2018	31.3.2019	Change	31.03.2018	31.12.2018
Balance sheet total	815.1	–6.6%	872.3	810.1	–13.2%	933.7	768.8
Equity	337.7	–1.7%	343.7	334.8	–17.9%	407.9	329.5
Equity ratio	41.4%	+2.0 PP	39.4%	41.3%	–2.4 PP	43.7%	42.9%
Investments in tangible and intangible assets	–21.4	–	42.1	16.2	–34.0%	24.5	80.8
Employees (at balance sheet date)	7,147	+4.0%	6,874	6,914	+2.7%	6,729	6,773

Sector and segment key figures

in EUR million	H1 2019	Change	H1 2018	Q2 2019	Change	Q2 2018	2018
Industrial Sector = Semperflex + Sempertrans + Semperform
Revenue	289.5	–0.7%	291.4	148.0	–1.7%	150.5	567.0
EBITDA	52.7	+39.0%	37.9	28.2	+47.2%	19.1	71.3
EBIT	39.5	+74.7%	22.6	21.1	>100%	9.5	44.6
Semperflex
Revenue	120.9	–0.6%	121.5	59.7	–4.9%	62.8	230.0
EBITDA	28.4	–0.8%	28.7	14.5	–2.7%	14.9	48.9
EBIT	22.6	–3.6%	23.4	11.5	–7.0%	12.3	38.4
Sempertrans
Revenue	68.2	–4.8%	71.7	37.8	+2.2%	37.0	144.8
EBITDA	8.1	–	–2.6	5.4	–	–3.1	0.5
EBIT	5.6	–	–8.3	3.8	–	–7.9	–7.1
Semperform
Revenue	100.4	+2.2%	98.2	50.5	–0.5%	50.7	192.2
EBITDA	16.1	+36.1%	11.8	8.3	+13.2%	7.3	21.9
EBIT	11.3	+50.4%	7.5	5.9	+14.0%	5.1	13.2
Medical Sector = Sempermed
Revenue	147.8	–5.9%	157.1	76.4	–0.9%	77.1	311.5
EBITDA	–0.3	–	0.1	0.6	–	–1.3	–3.9
EBIT	–4.2	–93.2%	–62.5	–1.4	–97.6%	–60.3	–69.6

Note: Rounding differences in the totalling of rounded amounts and percentages may arise from the use of automatic data processing. 1) Earnings per share are only attributable to the core shareholders of Semperit AG Holding (excl. remuneration from hybrid capital). 2) Based on a full-year projection.

Group Management Report

Economic environment

The International Monetary Fund (IMF) has made another downward adjustment for its growth forecast for 2019 published in July 2019 in comparison with the version of April 2019. Global economic growth will be 3.2% for 2019 (2018: 3.6%) instead of 3.3% forecast in April 2019. For 2019, the forecast for emerging and developing countries now stands at 4.1% (so far 4.4%), followed by the USA at 2.6% (so far 2.3%) and the euro zone at 1.3% (so far 1.3%).

Growth expectations for the euro zone therefore remain unchanged compared with the World Economic Outlook published by the IMF in April 2019. Forecasts have not been further lowered for the three major European economies Germany, France and Italy - with the exception of Germany, where growth expectations have been reduced by 0.1 percentage points.

The biggest pressures on global economic development continue to include the ongoing trade disputes between the USA and China and the risk of a disorderly Brexit as well as the slowdown in growth in Germany due to a decreased international demand.

Development in the raw material markets

The markets for butadiene, carbon black, wires as well as a variety of chemicals with various markets (which is why it is not explained here in detail) are very important for the rubber industry. The development of these markets in the natural rubber field is influenced, among other things, by production conditions, while the fields of synthetic rubber and carbon black are impacted by supplier behaviour and costs for basic raw materials, which are affected by the price of crude oil. Demand is partially influenced by the main buyers of rubber products, the tyre and automotive industry.

Since the end of 2018, price indices for natural rubber and natural latex showed an upward trend, which continued steadily until the middle of the first half of 2019 and then slightly decreased again. The average values of the first half of 2019 were above the average values for the first half of 2018.

The price indices for butadiene, among others a major basic raw material for the production of synthetic rubber and synthetic latex, showed a slight upward trend in 2018; there was a decline at the beginning of the fourth quarter of 2018, followed by a sideways phase. Since the middle of the second quarter of 2019, there has been a downward trend in the European market, while the indices in the Asian region have recorded a price increase. In the first half of 2019, the average prices for butadiene, which is used as a basic raw material in the Sempertrans and Sempermed segments, were below the average values of the previous year.

Development of raw materials used primarily in the Industrial Sector was somewhat differentiated. The filling material carbon black is important for all three segments of the Industrial Sector. The price index for this raw material showed a continuous rise from the third quarter of 2017 until the end of the third quarter of 2018, then corrected briefly down in the fourth quarter of 2018 and then started to increase again. At the beginning of the second quarter of 2019, a new downward trend started, trending upward again at the end of the second quarter of 2019. The average price indices of the first half of 2019 were above the average of the first half of 2018.

In the first half of 2019, the average prices for wire, which is primarily used in the Semperflex and Sempertrans segments, were slightly below the average values of the first half of 2018.

Revenue and earnings development

First half of 2019

In the first half of 2019, the Semperit Group recorded a decrease in revenue by 2.5% to EUR 437.3 million compared with the same period of the previous year. The Industrial Sector also recorded a decrease in revenue of 0.7%, while the Medical Sector recorded a decline of 5.9% (for details on the development of Sectors and segments, see page 8). The decrease in the Industrial Sector was mainly characterised by a slight decline in volumes. The decline in revenue in the Medical Sector, i.e. the Sempermed segment, is primarily due to a decline in volumes sold.

The distribution of revenue continued to exist in favour of the Industrial Sector. In the first half of 2019, the Industrial Sector accounted for 66% and the Medical Sector for 34% of the Semperit Group's revenue (first half of 2018: 65% to 35%).

In the first half of 2019, inventories increased by EUR 1.4 million compared with an increase of EUR 4.2 million in the first half of 2018.

Other operating income amounted to EUR 4.4 million in the first half of 2019 (EUR 2.0 million in the first half of 2018). It should be noted that in the first quarter of 2019, this included earnings of EUR 1.3 million from the sale of tangible assets from the production site in China, which was closed in 2018.

In the first half of 2019, cost materials decreased by EUR 18.7 million or 7.0% to EUR 249.9 million. The change is primarily due to a decline in volumes sold and therefore lower costs of material and purchased services, but also to partially higher raw material prices.

In the first half of 2019, personnel expenses rose to EUR 100.8 million (+2.5%) compared to the previous year (first half of 2018: EUR 98.4 million - see presentation changes in the consolidated financial statements page 23), which is, among other things, due to wage and salary increases and an increased headcount in Odry, Czech Republic, due to the expansion of the Semperflex site as well as due to tightened immigration policies and raising the minimum wage level in Malaysia.

At EUR 54.5 million, other operating expenses were below the last year's period at EUR 60.8 million. Compared with 2019, the first quarter of 2018 also included higher consulting expenses relating to Semperit's restructuring and transformation.

EBITDA (earnings before interest, tax, depreciation and amortisation) rose from EUR 32.7 million (value for the first half of 2018 adjusted for the negative one-off effect of EUR 3.9 million from the shutdown of the Sempertrans site in China) in the first half of 2018 to EUR 39.1 million in the first half of 2019. The EBITDA margin increased from 7.3% (adjusted value for the first half of 2018) to 9.0% in the first half of 2019.

Depreciation decreased to EUR 17.4 million (−10.4%), which was primarily due to the reduced depreciation basis as a result of the impairment in the Sempermed segment, which was recorded in the second quarter of 2018.

EBIT (earnings before interest and tax) was EUR 13.2 million (adjusted value for the first half of 2018) and improved to EUR 20.9 million in the first half of 2019. The EBIT margin increased from 2.9% (adjusted value for the first half of 2018) to 4.8% in the first half of 2019. The reported EBIT totalled EUR 20.9 million in the first half of 2019 after EUR 49.8 million in the first half of 2018.

Key figures Semperit Group

H1 2019	H1 20181	Change	Change in EUR million
437.3	448.5	-2.5%	–11.2
39.1	28.9	+35.5%	+10.3
9.0%	6.4%	+2.6 PP
20.9	-49.8	I	+70.7
4.8%	-11.1%	+15.9 PP
5.8	-67.4		+73.2
21.4	42.1	-49.2%	-20.7
7,147	6,874	+4.0%	+273

Adjusted for the one-off effect from the shutdown of the Sempertrans site in China, EBITDA for the first half of 2018 amounted to

EUR 32.7 million; EBIT additionally adjusted for imparment of EUR 55.2 million) totalled EUR 13.2 million; adjusted earnings after tax amounted to EUR –4.4 million.

The financial result totalled EUR -6.6 million in the first half of 2019 after EUR -6.6 million in the first Half of 2018. At EUR 0.4 million, financial income, which includes primarily income from bank balances, was below the previous year's value. Financial expenses (primarily interest expenses for loans and credits) amounted to EUR 4.3 million in the first half of 2019 and were therefore below the previous year's value of EUR 4.6 million.

In the first half of 2019, the item "Profit/loss attributable to redeemable non-controlling interests" at EUR –2.4 million was above the previous year's level.

Income tax expenses decreased by EUR 2.4 million to EUR 8.5 million in the first half of 2019.

Earnings after tax totalled EUR 5.8 million for the first half of 2019 compared with EUR –67.4 million for the same period of 2018. Earnings per share amounted to EUR-0.28 in the first half of 2019 after EUR -3.33 in the first half of 2018.

Second quarter of 2019

In a comparison of the second quarters of 2019 and 2018, the Semperit Group recorded a decrease in revenue of 1.4% to EUR 224.4 million. Decreases in revenue were recorded in the Industrial Sector (-1.7%) and in the Medical Sector (-0.9%). In the Industrial Sector, the Semperform segments showed declines in revenue in a quarter-on-quarter comparison, while Sempertrans recorded an increase in revenue.

Other operating income increased from EUR 1.1 million to EUR 1.5 million. Cost of material and purchased services as well as other operating expenses decreased. Personnel expenses rose from EUR 50.6 million to EUR 50.9 million, a plus of 0,6%.

EBITDA (earnings before interest, tax, depreciation and amortisation) rose from EUR 17.0 million (adjusted value for the second quarter of 2018) to EUR 22.7 million in the second quarter of 2019; the EBITDA margin increased from 7.5% (adjusted value for the second quarter of 2018) to 10.1% in the second quarter of 2019.

Depreciation decreased. There were no impairments in the first half of 2019.

EBIT (earnings before interest and tax) recovered from EUR 7.2 million (adjusted value for the second quarter of 2018) to EUR 13.1 million, while the EBIT margin rose from 3.2% (adjusted value for the second quarter of 2018) to 5.8% in the second quarter of 2019.

Earnings after tax totalled EUR 2.6 million in the second quarter of 2019 after EUR -64.8 million in the previous year's period. Earnings per share were EUR 0.13 in the second quarter of 2019 after EUR -3.19 in the second quarter of 2018.

				Veränderung
in Mio. EUR	Q2 2019	Q2 2018	Veränderung	in Mio. EUR
Umsatzerlöse	224,4	227,6	-1,4%	-3,3
FRITDA	22,7	13,1	72,7%	+9,5
EBITDA-Marge	10,1%	5,8%	+4,3 PP
EBIT	13,1	-55,8		+68,9
EBIT-Marge	5,8%	-24,5%	+30,3 PP
Ergebnis nach Steuern	2,6	-64,8		+67,4
Investitionen in Sachanlagen und immaterielle
Vermögenswerte	5,2	17,6		–12,4
Mitarbeiter (Stichtaq)	7.147	6.874	+4,0%	+273

Kennzahlen Semperit Gruppe / Zweites Quartal

1 Adjusted for the one-off effect from the shutdown of the Sempertrans site in China, EBITDA for the second quarted to EUR 17.0 million; EBIT additionally adjusted for impairments (including the Sempermed segment of EUR 55.2 million) totalled EUR 7.2 million;
adjusted earnings after tax anoun

Dividend and treasury shares

Semperit's dividend policy is, in principle: The pay-out ratio to shareholders is around 50% of earnings after tax - assuming continued successful performance and that no unusual circumstances occur. Due to negative earnings after tax in 2018 and the continued restructuring and transformation process, no dividend was proposed at the Annual General Meeting on 8 May 2019. Semperit AG Holding does not own treasury shares as of 30 June 2019.

Assets and financial position

Compared with the balance as of 31 December 2018, the balance sheet total as of 30 June 2019 rose by 6.0% to EUR 815.1 million. On the asset side, the main reasons for this rise were increases in tangible assets, the rise of receivables and of cash and cash equivalents.

On the liabilities side, basically three items increased: The other current and non-current financial liabilities increased due to the recognition of leasing liabilities as a result of the first-time application of IFRS 16. Equity rose due to an increase in revenue reserves and a positive change in currency translation reserves.

Trade working capital (inventories plus trade receivables minus trade payables) decreased from EUR 184.3 million to EUR 177.9 million since the end of 2018 and therefore constituted 20.5% of revenue (year-end 2018: 21.0%). The change is primarily attributable to higher trade payables (+22.9%), trade receivables (+12.3%) and inventories (-2.2%).

Cash and cash equivalents amounted to EUR 154.9 million at the end of June 2019 and were therefore above the level of the end of 2018 (EUR 121.5 million). The reason for this was, among other things, an improved cash management and lower investments in tanqible and intangible assets.

As of 30 June 2019, the Semperit Group's equity (without non-controlling interests) stood at EUR 337.7 million, EUR 8.2 million higher than at the end of 2018 (EUR 329.5 million).

As of 30 June 2019, the reported equity ratio was 41.4% after 42.9% at the end of 2018.

Return on equity was 3.4% (first half of 2018: –38.8%) for the first half of 2019, which is calculated based on earnings after tax of EUR 5.8 million (first half of 2018: EUR –67.4 million) in relation to the equity of EUR 337.7 million (first half of 2018: EUR 329.5 million) attributable to the shareholders of Semperit AG Holding.

Debt is higher to EUR 475.9 million compared with EUR 438.4 million at the end of 2018 – an increase of EUR 37.5 million, primarily from the recognition of leasing liabilities as a result of the first-time application of IFRS 16 and the increase in trade payables.

Financial liabilities (including primarily liabilities from the Schuldschein loan and to banks) stood at EUR 233.8 million at 30 June 2019 after EUR 234.2 million at the end of 2018. Taking into consideration cash and cash equivalents of EUR 154.9 million (year-end 2018: EUR 121.5 million), this resulted in an overall net debt of EUR 78.8 million as of 30 June 2019 (net debt at the end of 2018: EUR 112.7 million). The net debt/EBITDA ratio (net debt in relation to EBITDA) as of 30 June 2019 is therefore 1.39 (yearend 2018: 2.43).

The liabilities from redeemable non-controlling interests increased to EUR 16.0 million (2018: EUR 13.4 million). Provisions including social capital amounted to EUR 67.4 million and were therefore higher than EUR 69.3 million at the end of 2018. Trades payable rose to EUR 83.3 million (yearend 2018: EUR 67.7 million) and were considered in trade working capital. Other liabilities (other liabilities, deferred taxes, current income taxes and other financial liabilities) increased to FUR 75 4 million after FUR 53 7 million

Cash flow

The gross cash flow in the first half of 2019 amounted to EUR 31.5 million after EUR 22.4 million in the first half of 2018. The increase was primarily due to the higher earnings before tax in the first quarter of 2019.

The cash flow from operating activities increased to EUR 59.4 million in the first half of 2019 (first half of 2018: EUR –1.5 million), which was due to the changes in trade receivables, trade payables as well as other liabilities and current provisions as well as inventories, among other things.

The cash flow from investing activities was EUR –19.6 million in the first half of 2019 and therefore lower than in the previous year (EUR -41.7 million), which was primarily due to reduced investment activities.

At EUR -6.9 million, the cash flow from financing activities in the first half of 2019 was below the value of the first half of 2018 at EUR 78.9 million. The amount in the first half of 2018 was overall positively influenced, above all by the incoming payment from the hybrid capital, which was up against repayments of liabilities to banks.

Investments

At EUR 21.4 million, cash-relevant investments in tangible assets were lower than in the previous year (EUR 42.1 million). Investments focused on expansion and improvement at the plants in Malaysia (EUR 7.4 million), the Czech Republic (EUR 4.9 million) and Poland (EUR 4.2 million). These were predominantly expansion investments.

Related-party transactions with companies and individuals

With regard to the related-party transactions with companies and individuals please refer to the interim consolidated financial statements.

Performance of sectors and segments

Industrial Sector

The Industrial Sector comprises the segments Sempertrans and Semperform and developed in a differentiated way: Semperform increased their revenues, while Sempertrans recorded slight declines. In total, the sector's revenue decreased by 0.7% from EUR 291.4 million to EUR 289.5 million in the first half of 2019.

Due to the positive development in the segments, overall profitability in the Industrial Sector increased. EBITDA rose by 39.0% to EUR 52.7 million and EBIT by 74.7% to EUR 39.5 million. The EBITDA margin improved from 13.0% to 18.2% and the EBIT margin from 7.8% to 13.6%. Primarily the initiatives from the restructuring and transformation programme contributed to this.

In terms of the absolute EBITDA contribution, the Semperflex segment contributed by far the largest share, followed by Semperform and Sempertrans.

in EUR million	H1 2019	Change	H1 2018	Q2 2019	Change	Q2 2018	2018
Revenue	289.5	-0.7%	291.4	148.0	-1.7%	150.5	567.0
EBITDA	52.7	+39.0%	37.9	28.2	+47.2%	19.1	71.3
EBITDA margin	18.2%	+5.2 PP	13.0%	19.0%	+6.3 PP	12.7%	12.6%
EBIT	39.5	+74.7%	22.6	21.1	>100%	9.5	44.6
EBIT margin	13.6%	+5.8 PP	7.8%	14.3%	+8.0 PP	6.3%	7.9%
Earnings after tax	21.4	-36.1%	33.5	3.4	-78,1%	15.5	67.0
Investments in tangible and
intangible assets	3,691	-1.5%	3,745	3,691	-1.5%	3,745	3,654

Key figures Industrial Sector

Semperflex segment

In the first half of 2019, revenue in the Semperflex segment decreased by -0.6% compared with the previous year. The EBITDA margin for the first half of 2019 was 23.5% (first half of 2018: 23.6%), while the EBIT margin was 18.7% (first half of 2018: 19.3%).

The first half of the year was characterised by lower market demand due to storage within the supply chain and uncertainty relating to future market development. The order situation dropped compared with the previous period. This is also reflected in a decline in incoming orders.

In the first half of 2019, revenue and profitability were at a similar level as in the first half of 2018.

Sempertrans segment

In the first half of 2019, revenue declined by 4.8% compared with the previous year due to decreasing volumes. A significant improvement of profitability was recorded, primarily due to an improved order quality.

Due to the restructuring and transformation programme, the successful turnaround of the Sempertrans segment continues. The expansion project at the site in Bełchatów, Poland, was successfully completed in June 2019. With 5 mixing lines and a capacity of 75,000 tonnes per year, the Polish site in Bełchatów is the largest mixing site within the Semperit Group.

Profitability continued to increase: in the first half of 2019, the EBITDA margin amounted to 11.9% (adjusted value of 1.8% in the first half of 2018), while the EBIT margin was 8.2% in the first half of 2019 (adjusted value of –0.7% in the first half of 2018). The reported figures for the first half of 2019 included a profit of EUR 1.3 million from the sale of tangible assets from the production site in China that was closed in 2018.

Semperform segment

The Semperform segment recorded a revenue increase of 2.2% - demand for infrastructure was good, while demand in the construction industry continued to slow down, with different effects on sales in the individual business units.

In a comparison of the first half of 2019 with the previous year, an increase in revenue (+2.2%), EBITDA (+36.1%) and EBIT (+50.4%) was recorded. Profitability also rose: the EBITDA margin was 16.0% (first half of 2018: 12.1%), while the EBIT margin was 11.3% (first half of 2018: 7.7%). Good operational implementation of the restructuring and transformation process provided encouraging profitability results. The first half of 2019 brought a good order situation and capacity utilisation.

Key figures Semperflex

in EUR million	H1 2019	Change	H1 2018	Q2 2019	Change	Q2 2018	2018
Revenue	120.9	-0.6%	121.5	59.7	-4.9%	62.8	230.0
FRITDA	28.4	-0.8%	28.7	14.5	-2.7%	14.9	48.9
EBITDA margin	23.5%	-0.1 PP	23.6%	24.3%	+0.5 PP	23.8%	21.3%
EBIT	22.6	-3.6%	23.4	11.5	-7.0%	12.3	38.4
EBIT margin	18.7%	-0.6 PP	19.3%	19.2%	-0.5 PP	19.7%	16.7%
Investments in tangible and intangible assets	6.6	-61.6%	17.1	1.4	-84.9%	9.2	33.5
Employees (at balance sheet date)	1,777	-0.6%	1,788	1,777	-0.6%	1,788	1,776

Key figures Sempertrans

in EUR million	H1 2019	Change	H1 20181	Q2 2019	Change	Q2 20182	2018
Revenue	68.2	-4.8%	71.7	37.8	+2.2%	37.0	144.8
EBITDA	8.1	-	-2.6	5.4	-	-3.1	0.5
EBITDA margin	11.9%	+15.5 PP	-3.6%	14.2%	+22.5 PP	-8.3%	0.4%
EBIT	5.6		-8.3	3.8		-7.9	-7.1
EBIT margin	8.2%	+19.8 PP	-11.6%	10.0%	+31.4 PP	-21.4%	-4.9%
Investments in tangible and intangible assets	1.6	-86.2%	11.6	0.3		4.2	21.6
Employees (at balance sheet date)	898	-4.4%	940	898	-4.4%	940	878

^ EBITDA adjusted for negative effects of shutdown costs for China for the first half of 2018 amounted to EUR 1.3 million, while the
adjusted EBIT was EUR –0.5 million

agasted by Prima Lor West in China for the second quarter of 2018 amounted to EUR 0.8 million, while and

Key figures Semperform

in EUR million	H1 2019	Change	H1 2018	Change	Q2 2018	2018

Revenue	100.4	+2.2%	98.2	50.5	-0.5%	50.7	192.2
EBITDA	16.1	+36.1%	11.8	8.3	+13.2%	7.3	21.9
EBITDA margin	16.0%	+3.9 PP	12.1%	16.4%	+2.0 PP	14.4%	11.4%
EBIT	11.3	+50.4%	7.5	5.9	+14.4%	5.1	13.2
EBIT margin	11.3%	+3.6 PP	7.7%	11.6%	+1.5 PP	10.1%	6.9%
Investments in tangible and intangible assets	4.3	-11.6%	4.9	1.7	+19.6%	2.1	11.9
Employees (at balance sheet date)	1,016	-0.2%	1,018	1,016	-0.2%	1,018	1,000

Medical Sector: Sempermed segment

In the Sempermed segment, revenue decreased by 5.9% to EUR 147.8 million in the first half of 2019 compared with the previous year. Coping with operational problems led to visible improvements from the perspective of the isolated second quarter of 2019.

Sales of examination and protective gloves, which are primarily sold in North America and Europe, were 10.6% below the previous year's period. Sales of surgical gloves, which are produced in the core production facility in Wimpassing, Austria, were 0.4% below the previous year's level.

In the first half of 2019, EBITDA was EUR –0.3 million after EUR 0.1 million in the first half of 2018. EBIT amounted to EUR –4.2 million after EUR –7.3 million (adjusted value) in the first half of 2018. On the EBITDA level, Sempermed is returning to profitability (positive EBITDA since March 2019).

in EUR million	H1 2019	Change	H1 2018"	Q2 2019	Change	Q2 20182	2018
Revenue	147.8	-5.9%	157.1	76.4	-0.9%	77.1	311.5
FRITDA	-0.3	-	0.1	0.6	-	-1.3	-3.9
EBITDA margin	-0.2%	-0.3 PP	0.1%	0.8%	+2.5 PP	-1.7%	-1.3%
EBIT	-4.2	-93.2%	-62.5	-1.4	-97.6%	-60.3	-69.6
EBIT margin	-2.9%	+36.9 PP	-39.8%	-1.9%	+76.3 PP	-78.2%	-22.3%
Investments in tangible and intangible assets	3.2	-60.7%	8.0	1.8	+12,5%	1.6	12.7
Employees (at balance sheet date)	3,319	+10.4%	3,008	3,319	+10.4%	3.008	2,979

Key figures Sempermed

^ EBIT adjusted for the negative effects of the inpairnent of EUR 5.2 million for the first hall of 201 amounted to EUR –.1 million.
ª EBIT adjusted for the inpairment of EU

As of 30 June 2019, the number of employees was 7,147, which is 4.0% above the level of 30 June 2018. The employee headcount decreased in all segments except Sempermed. The analysis by segments shows that around 45% of all employees work in the Sempermed segment, while around 25% work in the Semperflex segment and less than 15% in the Sempertorm segments respectively.

Supervisory and Management Board matters

The Supervisory Board mandates of Christoph Kollatz and Felix Fremerey expired on 8 May 2019 (date of Annual General Meeting), while Christoph Trentini resigned his mandate on the same day at his own request. At the Annual General Meeting on 8 May 2019, Peter Edelmann, Birgit Noggler and Patrick Prügger were newly elected to the Supervisory Board. At the constituent meeting of the Supervisory Board, which took place following the Annual General Meeting, Peter Edelmann was elected as the successor of Christoph Kollatz as Chairman of the Supervisory Board. Stefan Fida remains Deputy Chairman of the Supervisory Board. Birgit Noggler takes over the chairmanship of the Audit Committee of Semperit AG Holding.

The Supervisory Board of Semperit AG Holding has extended the Management Board mandate of CFO Frank Gumbinger until 30 June 2022 and the Management Board mandate of Felix Fremerey, Management Board member, until 30 November 2020.

Outlook

The Management Board of Semperit will systematically continue the chosen transformation process. Continuous and potentially new measures to increase profitability remain at the top of the Management Board's agenda.

Since Semperit currently has sufficient capacities in production and in Mixing, capital expenditures (CAPEX, including maintenance) of only around EUR 40 million are planned for 2019. This should also bring us closer to the goal of a positive free cash flow in 2019.

Increased financial discipline is enforced through step-by-step cost optimisation and reduced net debt, with our focus on value management and optimisation of the working capital and the positive free cash flow representing a sustainable key performance indicator in our financial planning.

Since the beginning of the restructuring and transformation process, the Management Board has identified significant potentials for earnings improvement and initiated appropriate implementation measures. The conclusion of the transformation of the Semperit Group is scheduled for the end of 2020. From this point of time, the Semperit Group aims to achieve an EBITDA margin of around 10% (run rate 2021) as central key performance indicator.

Note

This outlook is based on the assessments of the Management Board as of 13 August 2019 and does not take into account the effects of possible acquisitions, divestments or other unforeseeable structural or economic changes during the further course of 2019. These assessments are subject to both known and unknown risks and uncertainties, which may result in actual events and outcomes differing from the statements made here.

Vienna, 13 August 2019

The Management Board

Martin Füllenbach Chairman

Frank Gumbinger Chief Financial Officer

Felix Fremerey Member of the Management Board

Half-Year Consolidated Financial Statements

Half-Year Consolidated Financial Statements Semperit Group I Half year financial report 2019 13

Consolidated income statement

in EUR thousand	Note	H1 2019	H1 20181)	Q2 2019	Q2 20181)
Revenue	2.2	437,305	448,542	224,367	227,633
Changes in inventories		1,402	4,246	1,057	–362
Own work capitalised		1,091	1,726	456	981
Operating revenue		439,797	454,513	225,880	228,252
Other operating income	2.3	4,436	2,006	1,536	1,076
Cost of material and purchased services		–249,985	–268,663	–127,356	–134,815
Personnel expenses	2.4	–100,785	–98,361	–50,930	–50,619
Other operating expenses	2.5	–54,496	–60,886	–26,593	–30,930
Share of profits from associated companies		178	276	128	163
Earnings before interest, tax, depreciation and amortisation (EBITDA)		39,146	28,886	22,665	13,127
Depreciation and amortisation of tangible and intangible assets		–17,357	–19,368	–8,714	–9,791
Impairment of tangible and intangible assets	3.4	–884	–59,339	–884	–59,148
Earnings before interest and tax (EBIT)		20,905	–49,821	13,067	–55,812
Finance income		428	325	183	166
Finance expenses		–4,333	–4,555	–1,964	–2,407
Profit / loss attributable to redeemable non-controlling interests		–2,368	–1,518	–1,112	–266
Other financial result		–293	–877	–2,385	1,541
Financial result	2.6	–6,566	–6,624	–5,277	–966
Earnings before tax		14,338	–56,446	7,790	–56,778
Income taxes		–8,524	–10,954	–5,195	–7,981
Earnings after tax		5,815	–67,400	2,594	–64,760
thereof attributable to the shareholders of Semperit AG Holding – from ordinary shares		2,294	–68,459	815	–65,664
thereof attributable to the shareholders of Semperit AG Holding – from hybrid capital		3,450	1,839	1,744	1,725
thereof attributable to non-controlling interests		70	–779	35	–821
Earnings per share in EUR (diluted and undiluted) 2)		0.28	–3.33	0.13	–3.19

1) The comparative figures were adjusted (see chapter 1.3).

2) The earnings per share is solely attributable to the ordinary shareholders of Semperit AG Holding (excl. interest from hybrid capital).

Consolidated statement of comprehensive income

in EUR thousand	H1 2019	H1 2018	Q2 2019	Q2 2018
Earnings after tax	5,815	–67,400	2,594	–64,760
Other comprehensive income that will not be recognised through profit and loss in future periods	96	–44	48	–33
Remeasurements of defined benefit plans	0	–5	0	1
thereof Revaluation gains / losses for the period	0	–5	0	1
thereof related to income tax	96	–40	48	–33
Other comprehensive income that will potentially be recognised through profit and loss in future periods	2,928	1,448	236	–243
Cashflow hedges	445	1,993	–318	2,011
thereof Revaluation gains / losses for the period	585	2,016	–248	2,037
thereof Reclassification to profit / loss for the period	–139	–23	–69	–27
Currency translation differences	2,545	–18	380	–1,708
thereof currency translation differences for the period	2,545	–18	380	–1,708
thereof related to income tax	–62	–528	173	–545
Other comprehensive income	3,024	1,403	284	–275
Comprehensive income	8,839	–65,997	2,878	–65,035
thereof on earnings attributable to the shareholders of Semperit AG Holding – from ordinary shares	5,237	–67,094	1,098	–65,955
thereof attributable to the shareholders of Semperit AG Holding – from hybrid capital	3,450	1,839	1,744	1,725
thereof on earnings attributable to non-controlling interests	152	–741	35	–806

Consolidated cash flow statement

in EUR thousand	Note	H1 2019	H1 20181)
Earnings before tax		14,338	–56,446
Depreciation, amortisation, impairment and write-ups of tangible and intangible assets		18,241	78,707
Profit / loss from disposal of assets (including current and non-current financial assets)		–1,240	13
Change in non-current provisions		960	–1,254
Share of profits from associated companies		–178	–276
Profit / loss attributable to redeemable non-controlling interests		2,368	1,518
Net interest income (including income from securities)		3,537	3,309
Taxes paid on income		–4,134	–3,205
Other non-cash expense / income		–2,357	82
Gross cashflow		31,535	22,448
Change in inventories		5,407	–5,870
Change in trade receivables		–10,792	–27,611
Change in other receivables and assets		6,956	1,134
Change in trade payables		24,269	1,508
Change in other liabilities and current provisions		2,062	3,795
Changes in working capital resulting from currency translation adjustments		0	3,071
Cashflow from operating activities		59,438	–1,525
Proceeds from sale of tangible and intangible assets		1,361	119
Investments in tangible and intangible assets	3.1	–21,408	–42,125
Interest received		415	302
Investments in current and non-current financial assets		0	0
Cashflow from investing activities		–19,633	–41,704
Cash receipts from current and non-current financial liabilities		0	825
Repayment of current and non-current financial liabilities		–3,008	–50,056
Payments arising from leasing liabilities		–1,183	0
Dividends to non-controlling shareholders of subsidiaries		–407	0
Acquisition of non-controlling interests	5.2	–2	–5
Cash receipts from hybrid capital		0	130.000
Interest paid		–2,308	–1,855
Cashflow from financing activities		–6,909	78,909
Net increase / decrease in cash and cash equivalents		32,896	35,678
Currency translation differences		505	–105
Cash and cash equivalents at the beginning of the period		121,549	165,530
Cash and cash equivalents at the end of the period		154,950	201,103

1) The comparative figures were adjusted (see chapter 1.3).

Consolidated balance sheet

in EUR thousand	Note	30.06.2019	31.12.2018
ASSETS
Non-current assets
Intangible assets		9,332	11,935
Tangible assets	1.2, 3.1	345,236	335,363
Investments in joint ventures and associated companies	3.2	2,841	2,653
Other financial assets		7,967	7,653
Other assets		4,509	6,946
Deferred taxes		3,495	4,364
		373,379	368,914
Current assets
Inventories		147,085	150,425
Trade receivables		114,115	101,645
Other financial assets	3.3	5,940	7,702
Other assets		11,953	14,017
Current tax receivables		3,100	4,555
Cash and cash equivalents		154,950	121,549
		437,144	399,893
Non-current assets held for sale	3.4	4,590	0
		441,734	399,893
ASSETS		815,114	768,807
EQUITY AND LIABILITIES
Equity	5.0
Share capital		21,359	21,359
Capital reserves		21,503	21,503
Hybrid capital		130.000	130.000
Revenue reserves		170,362	164,630
Currency translation reserve		–5,537	–7,999
Equity attributable to the shareholders of Semperit AG Holding		337,687	329,494
Non-controlling interests		1,548	904
		339,235	330,398
Non-current provisions and liabilities
Provisions		49,348	48,173
Liabilities from redeemable non-controlling interests		16,006	13,376
Financial liabilities	4.1	211,095	213,301
Other financial liabilities	1.2, 4.2	9,823	2,017
Other liabilities		247	561
Deferred taxes		8,321	7,120
		294,840	284,548
Current provisions and liabilities
Provisions		18,077	21,151
Financial liabilities		22,674	20,933
Trade payables		83,291	67,746
Other financial liabilities	1.2	19,439	19,935
Other liabilities		33,987	21,478
Current tax liabilities		3,572	2,619
		181,039	153,861
EQUITY AND LIABILITIES		815,114	768,807

Consolidated statement of

the changes in equity

in EUR thousand	Note	Share capital	Capital reserves	Hybrid capital	Revenue reserves	Currency translation reserve	Total	Non controlling interests	Total equity
As at 01.01.2018		21,359	21,503	0	244,464	–8,820	278,506	1,784	280,291
Initial adjustment under IFRS 9		0	0	0	422	0	422	0	422
Adjusted as at 01.01.2018		21,359	21,503	0	244,886	–8,820	278,928	1,784	280,712
Earnings after tax		0	0	0	–66,620	0	–66,620	–779	–67,400
Other comprehensive income		0	0	0	1,421	–56	1,365	38	1,403
Comprehensive income		0	0	0	–65,199	–56	–65,255	–741	–65,997
Acquisition of non-controlling interests		0	0	0	0	0	0	–5	–5
Raise of hybrid capital		0	0	130,000	0	0	130,000	0	130,000
As at 30.06.2018		21,359	21,503	130,000	179,687	–8,876	343,673	1,038	344,711
As at 01.01.2019		21,359	21,503	130,000	164,630	–7,999	329,493	904	330,398
Earnings after tax		0	0	0	5,745	0	5,745	70	5,815
Other comprehensive income		0	0	0	480	2,463	2,942	82	3,024
Comprehensive income		0	0	0	6,224	2,463	8,687	152	8,839
Acquisition of non-controlling interests		0	0	0	–493	0	–493	491	–2
As at 30.06.2019		21,359	21,503	130,000	170,362	–5,537	337,688	1,548	339,235

Notes to the half-year financial statements

1. General

1.1.Preparation and presentation of the consolidated half-year financial statements

These consolidated half-year financial statements have been prepared in accordance with International Financial Reporting Standards (IFRSs) as well as IAS 34 for interim financial statements.

For more information on accounting and valuation methods of the Semperit Group, please see the consolidated financial statements at 31 December 2018, which in this regard form the basis for these consolidated half-year financial statements.

The reporting currency is the euro, with figures rounded to the nearest thousand, unless expressly stated otherwise. Rounding differences in the totalling of rounded amounts and percentages may arise from the automatic processing of data.

These consolidated half-year financial statements of the Semperit Group at 30 June 2019 have not been fully audited or reviewed by the Group's auditor.

The Semperit Group prepared these consolidated half-year financial statements using the same accounting policies – with the exception of the IASB's new accounting regulations as described below – that it applied in its consolidated financial statements at 31 December 2018.

1.2.Standards and interpretations to be adopted for the first time

The following amended standards and interpretations were applicable for the first time in the first half of 2019.

First-time adoption of standards and interpretations		Endosement	Obligation to apply for the Semperit Group	Significant effects on the Semperit Group:
	New standards and interpretations
IFRS 16	Leases	31 October 2017	1 January 2019	yes
IFRIC 23	Uncertainty regarding income tax treatment	23 October 2018	1 January 2019	no
Amended standards
IFRS 9	Amendments to financial instruments	22 March 2018	1 January 2019	no
IAS 19	Amendments to employee benefits	13 March 2019	1 January 2019	no
IAS 28	Amendments to investments in associates and joint ventures	8 February 2019	1 January 2019	no
Miscellaneous	Annual improvments to IFRS, cycle 2015-2017	14 March 2019	1 January 2019	no

IFRS 16 Leasing

The new leasing standard IFRS 16 replaces the contents of IAS 17 and its related interpretations and regulates the principles for the recognition, measurement and disclosure as well as tax liabilities relating leasing contacts. The new standard no longer distinguishes on the lessee side between operating and finance leases. With a few exceptions, all leases and the rights and obligations associated with them will have to be recognised in the lessee's balance sheet. From the lessor's perspective, the accounting standards in IFRS 16 remain widely unchanged when comparing them to IAS 17.

At the time of the deployment of the leasing object the Semperit Group shows a leasing liability as in its function as lessee and an asset arising from the right of use. The leasing liability is interestbearing and is repaid on an annuity basis by reoccurring payments; the right of use asset is depreciated over the shorter time of useful live and contract term. This leads to an increase in assets and liabilities, which also results in higher depreciations (H1 2019: EUR 1,111 thousand) and interest expenses (H1 2019: EUR 123 thousand); against it the rental and leasing expenses are reduced (H1 2019: EUR 1,179 thousand). Following EBITDA and EBIT are increased from the first-time application

of IFRS 16. The operating cashflow is also improving, as rental and leasing payments are transformed to interest and settlement payments and these are allocated to the cashflow from financing activities.

For the recognizable leasing contracts, the Semperit Group capitalizes the right of use as part of the tangible assets and discloses the leasing liabilities as other financial liabilities. The Semperit Group is acting primarily as lessee of right of use assets on land and buildings, office equipment and vehicles.

The Semperit Group chose the modified retrospective approach for the first-time application as of 1 January 2019; which led to not amending the prior year figures. Furthermore, the Semperit Group applied IFRS 16 only for those contracts, that were previously classified under IAS 17 or classified under IFRIC 4. Contracts, that were not identified as leasing contracts before, where therefore not remeasured during the first-time application of IFRS 16 as the option that is foreseen in IFRS 16 was made use of.

The Semperit Group exercises the right foreseen in IFRS 16 to not apply the lease-accounting rules on contracts with a short leasing period (less than 12 months), on leasing objects with a low value (below the value of approximately EUR 5 thousand) and on intangible assets. The Semperit Group therefore does not disclose right of use assets and leasing liabilities for those type of contracts; leasing payments arising from these contracts are distributed linearly over the duration of the contract as rental expenses.

The right to account leasing contracts, that have a duration of less than 12 months from the firsttime application, as short-term contracts, is also exercised. For all other operating leasing contracts, where the Semperit Group acts as the lessee the present value of the future leasing payments is accounted as a leasing liability. Right of use assets are shown as part of the fixed assets with the amount of the leasing liability and are adjusted by prepaid or deferred leasing payments. Initial direct costs were not included in the measurement of the right of use asset at the time of the fist-time application.

For leasing contracts that were recognised for the first time as of 1 January 2019, a weighted average marginal borrowing rate of 2.64% was applied.

The effects on the consolidated balance sheet as of 1 January 2019 arising from the first-time application of IFRS 16 are the following:

		IFRS 16
in EUR thousand	31.12.2018	Adjustment	01.01.2019
Non-current assets
Tangible assets	335,363	9,337	344,700
hereof tangible assets from finance lease contracts	44	–44	0
hereof Right of use assets - land and buildings	0	7,358	7,358
hereof Right of use assets - other assets, vehicles, office equipment	0	2,023	2,023
Current assets
Other assets	14,017	–33	13,984
Right of use asset from the first-time adopion of IFRS 16		9,303
Non-current provisions and liabilities
Other financial liabilities	2,017	7,555	9,572
Current provisions and liabilities
Other financial liabilities	19,935	1,748	21,683
Liabilites from the first-time adoption of IFRS 16		9,303

The following table shows the reconciliation of the minimum lease payments as of 31 December 2018 to the lease liabilities as of 1 January 2019:

in EUR thousand
Commitments for less than one year	2,776
Commitments for longer than one year and up to five years	5,685
Commitments for longer than five years	655
Total commitments arising from non-redeemable rental agreements and leases as of 31.12.2018
	9,116
Commitments from adequate certain extension or termination options	2,091
Commitments arising from short-term leases	–605
Commitments arising from low-value assets	–57
Total commitments for the determination of the lease liability	10,545
Effect of discounting at the marginal borrowing rates	–1,241
Liabilities from the first-time adoption IFRS 16
	9,303
Liabilities from finance leases as of 31.12.2018	70
Liabilities from leases as of 1.1.2019	9,374

As of 30 June 2019, right of use assets are disclosed in the fixed assets with EUR 10,376 thousand as well as leasing liabilities in the short- and long-term financial liabilities amounting to EUR 10,415 thousand.

1.3.Amentdments to comparative information

Amendments to how information is presented in the consolidated income statement

During the revision of the group chart of accounts, the disclosure of some expense types was harmonised from the first quarter 2019 onwards.

Since the financial year 2019 expenses arising from the use of external personnel, which are seen as employees of the entity from an economic standpoint, are shown in the personnel expenses. Further, expenses arising from the use of production-related spare parts are to be found in the material expenses and expenses relating to maintenance services which are conducted externally are disclosed in the expenses for purchased services.

The comparative figures for the first half of 2018 were therefore adjusted and are shown in the following table:

in EUR thousand	H1 2018 as reported	Personnel expenses for external workers	Expenses for spare parts	Production related maintenance costs	H1 2018 adjusted
Operating revenue	454,513	0	0	0	454,513
Other operating income	2,006	–	–	–	2,006
Cost of material and purchased services	–262,130	1,469	–1,910	–6,092	–268,663
Personnel expenses	–91,584	–6,777	–	–	–98,361
Other operating expenses	–74,196	5,308	1,910	6,092	–60,886
Share of profits from associated companies	276	–	–	–	276
Earnings before interest, tax, depreciation and amortisation (EBITDA)	28,886	0	0	0	28,886

Amendments to comparative information in the financial result

Following the Semperit Group's modification of its consolidated financial statements in 2018, a more suitable type of disclosure was chosen for the financial result. Therefore, the comparative information for the first half year of 2018 was amended.

in EUR thousand	H1 2018 as reported	Net foreign exchange result	Other adjustments	H1 2018 adjusted
Finance income (formerly: financial income)	18,663	–18,338	–	325
Finance expenses (formerly: financial expenses)	–23,770	18,374	841	–4,555
Profit / loss attributable to redeemable non controlling interests	–1,518	–	–	–1,518
Other financial result	–	–36	–841	–877
thereof net foreign exchange result	–	–415	–	–415
thereof net result from the valuation categories FVPL and FV – Hedging Instrument	–	379	13	392
thereof other	–	–	–854	–854
Financial result	–6,624	0	0	–6,624

The effects resulting from the change of disclosure are summarized in the following table:

Amendment to comparative information in the consolidated cashflow statement

Following the Semperit Group's modification of its consolidated financial statements in 2018 a method was chosen for presenting the consolidated cashflow statement which enables a more consistent deduction of the free cashflow; therefore, the comparative figures were adjusted.

Due to system improvements the valuation effects of trade working capital items are presented as other non-cash expenses or income. Further the changes of net current assets arising from currency translation adjustments were now allocated to the individual items. For the comparative period, this allocation was not possible due to data unavailability.

2. Performance

2.1.Segmentreporting

					Corporate	Group
in EUR thousand	Sempermed	Semperflex	Sempertrans	Semperform	Center	eliminations	Group
H1 2019
Revenue	147,844	120,856	68,231	100,374	–	–	437,305
EBITDA	–289	28,439	8,134	16,108	–13,391	145	39,146
EBIT	–4,236	22,588	5,596	11,302	–14,490	145	20,905
Cash and cash equivalents	25,027	20,927	21,921	11,008	76,068	–	154,950
Trade Working Capital	59,600	56,447	32,420	33,098	–3,655	–	177,909
Additions to tangible and intangible assets 1)	3,159	6,567	1,597	4,293	164	–	15,779
H1 2018
Revenue	157,112	121,543	71,693	98,194	–	–	448,542
EBITDA	98	28,662	–2,608	11,836	–8,698	–404	28,886
EBIT	–62,462	23,431	–8,340	7,517	–9,563	–404	–49,821
Cash and cash equivalents	37,434	25,561	25,394	14,813	97,901	–	201,103
Trade Working Capital	66,505	55,136	34,080	40,083	–4,802	–	191,003
Additions to tangible and intangible assets 1)	8,034	17,114	11,557	4,856	564	–	42,125

1) Excluding right-of-use assets according to IFRS 16

2.2.Revenue

Revenue from contracts with customers is broken down by segment and geographical region as follows:

in EUR thousand	Sempermed	Semperflex	Sempertrans	Semperform	Group
H1 2019
Western Europe	79,054	70,973	19,179	72,920	242,127
Eastern Europe	17,755	24,654	16,688	11,933	71,030
North America	29,795	12,621	3,465	5,053	50,935
Central and South America	3,855	1,239	2,324	634	8,053
Africa	1,196	475	2,108	153	3,932
Asia	14,849	10,805	23,452	9,620	58,726
Australia	1,340	87	1,013	61	2,502
Revenue	147,844	120,855	68,231	100,375	437,305
H1 2018
Western Europe	80,047	73,125	23,493	71,188	247,853
Eastern Europe	19,056	25,275	12,372	12,568	69,272
North America	33,474	10,729	7,177	4,306	55,685
Central and South America	5,441	787	3,789	640	10,657
Africa	734	1,573	4,887	96	7,289
Asia	16,779	9,521	10,083	9,375	45,757
Australia	1,581	533	9,892	21	12,028
Revenue	157,112	121,543	71,693	98,194	448,542

2.3.Other operating income

In the other operating income, an income in the amount of EUR 1,265 thousand is included arising from the sale of technical equipment and machines from the production site Sempertrans Best (ShanDong) Belting Co. Ltd., that was closed last year.

2.4.Personnel expenses

in EUR thousand	H1 2019	H1 2018
Wages	39,422	40,050
Salaries	41,360	38,682
Severance payments	728	1,675
Retirement benefit expenses	768	483
Statutory social security expenses and other compulsory wage-related payments	16,458	15,348
Other social security expenses	2,048	2,124
Total	100,785	98,361

2.5.Other operating expenses

in EUR thousand	H1 2019	H1 2018
Outgoing freight	16,010	15,944
Legal, consulting and auditing fees	10,168	12,592
Travel expenses	3,499	3,625
Maintenance and services	3,402	4,890
Commission and advertising costs	2,758	3,225
Insurance premiums	2,049	2,428
Other taxes	1,795	2,452
Rental and leasing expenses	1,289	2,900
Energy costs not for production	1,133	614
Waste disposal	899	966
Fees, subscriptions and donations	681	511
Training and education expenditures	650	553
Office equipment	614	567
Communications	585	589
Bank expenses	361	283
Other	8,601	8,745
Total	54,496	60,886

2.6.Financial result

H1 2019	H1 2018
428	325
428	326
–4,333	–4,555
–4,333	–4,555
–869	–415
273	392
303	–854
–293	–877
–2,368	–1,518
–6,566	–6,624

3. Non-current assets

3.1.Tangible and intangible assets

In the first half of 2019 the cash-relevant investments in tangible and intangible assets amounted to EUR 21,408 thousand (H1 2018: EUR 42,125 thousand). On the other hand, in the first half of 2019 tangible assets with a carrying value of EUR 121 thousand (H1 2018: EUR 131 thousand) were sold. These sales lead to a cash inflow of EUR 1,361 thousand in the first half 2019 (H1 2018: EUR 13 thousand).

In the first half of 2019 tangible assets were classified as assets available for sale (see 3.4.).

3.2.Investments in associated companies

As of 30 June 2019 the carrying amount of the shares of Synergy Health Allershausen amounted to EUR 2,831 thousand (30 June 2018: EUR 2,653 thousand).

3.3.Disclosures on financial instruments – non-current and current assets

The following table shows the carrying amounts of the individual financial assets classified in accordance with the valuation categories under IFRS 9.

Asset

in EUR thousand	Valuation category IFRS 91)	Level	Carrying amount 30.06.2019	Carrying amount 31.12.2018
Trade receivables
Trade receivables	AC	–	114,115	101,645
Other financial assets
Securities	FVPL	1	6,527	6,188
Loans to associated companies	AC	–	563	563
Other loans	AC	–	6	6
Derivative financial instruments	FVPL	2	4,674	4,211
Derivative financial instruments	FV – Hedging Instrument	2	191	263
Other financial assets	AC	–	1,953	4,129
Cash and cash equivalents
Cash on hand, cheques and cash deposits in banks	–	–	154,950	121,549

1)FVPL (Fair Value through Profit and Loss); FVOCI (Fair Value through OCI); AC (At cost)

Fair value

The three levels in the fair value hierarchy are defined as follows:

Level 1: measurement based on quoted prices on an active market for a specific financial instrument

Level 2: measurement based on quoted market prices for similar instruments or on the basis of

valuation models based exclusively on inputs that are observable on the market

Level 3: measurement based on models with significant inputs that are not observable on the market

Assets and liabilities not measured at fair value

The financial instruments measured at fair value are securities and derivative financial instruments.

in EUR thousand	Valuation category IFRS 91)	Fair Value 30.06.2019	Fair Value 31.12.2018	Level
Assets
Securities	FVPL	6,717	6,188	1
Derivative financial instruments	FVPL	4,674	4,211	2
Derivative financial instruments	FV – Hedging Instrument	191	263	2

1)FVPL (Fair Value through Profit and Loss); FVOCI (Fair Value through OCI); AC (At cost)

The derivative financial instruments (freestanding financial instruments) are foreign exchange forward contracts and a cross currency swap. The derivative financial instruments held for hedging are cross currency swaps, which in turn are backed by interest rate floors.

The fair values of the foreign exchange forward contracts and cross currency swaps are determined using accepted actuarial valuation models. Future payment flows are simulated using the yield curves published at the reporting date. In addition, the carrying amount is adjusted to take into account the credit risk of the respective counterparty. When doing so, positive exposures are measured considering the default risk of the counterparty.

3.4.Assets held for sale

In 2018 a production facility for conveyor belts of the Semperit Group was closed in Taierzhuang (China). The liquidation of the company, Sempertrans Best (ShanDong) Belting Co. Ltd., will be executed by a liquidation committee built up of representatives of Semperit and of the 16.1% minority shareholder, Shandong Wang Chao Coal & Electricity Group. Ltd; the government of the district will take care of the lawfull proceedings. In the first quarter of 2019 machines and technical equipment could be sold successfully (see 2.3). After the sale, the properties and buildings of the former production facility were in an usual ready to sale condition. As a consequence, as of 30 June 2019 these assets were classified as assets available for sale. The impairment test related to the reclassification resulted in an impairment in the amount of EUR 855 thousand which was reported in the EBIT of the segment Sempertrans. Due to the flagging economic development the sales process will be challenging. Nevertheless, the management of the Semperit Group is optimistic to realize the sale within the next 12 months.

4. Net debt

4.1.Financial liabilities

in EUR thousand	30.06.2019	Thereof non-current	Thereof	current 31.12.2018	Thereof non-current	Thereof current
Corporate Schuldschein loan	226,091	209,960	16,131	226,492	212,106	14,386
Liabilities to banks	7,679	1,135	6,543	7,742	1,195	6,547
Total	233,769	211,095	22,674	234,233	213,301	20,933

In the first half of 2019 a rebuy of the corporate Schuldschein loan with a nominal value of EUR 3,000 thousand took place for EUR 2,910 thousand.

4.2.Disclosure on financial instruments – liabilities

				Carrying amount	Carrying amount
in EUR thousand	Valuation category IFRS 91)	Level	Note	30.06.2019	31.12.2018
Liabilities from redeemable non-controlling interests	AC	–		16,144	13,376
Corporate Schuldschein loan	AC	3	4.1	226,091	226,492
Liabilities to banks	AC	–		7,679	7,742
Trade payables	AC	–		83,291	67,746
Derivative financial liabilities	FVPL	2		51	241
Derivative financial liabilities	FV – Hedging Instrument	2		862	1,486
Liabilities from leases	AC	–	1.2	10,415	70
Remaining other financial liabilities	AC	–		17,933	20,155

1) FVPL (Fair Value through Profit and Loss); FVOCI (Fair Value through OCI)

Liabilities measured at fair value

The financial instruments measured at fair value are derivative financial instruments.

in EUR thousand	Valuation category IFRS 91)	Fair Value 30.06.2019	Fair Value 31.12.2018	Level
Liabilities
Derivative financial liabilities	FVPL	51	241	2
Derivative financial liabilities	FV – Hedging Instrument	862	1,486	2

1) FVPL (Fair Value through Profit and Loss); FVOCI (Fair Value through OCI)

The financial instruments measured at fair value are derivative financial instruments. The derivative financial instruments (freestanding financial instruments) comprise an interest rate floor. The derivative financial instruments held for hedging are cross currency swaps, which in turn are backed by interest rate floors.

The fair values of the cross currency swaps and the interest rate floor are determined using accepted actuarial valuation models. Future payment flows are simulated using the yield curves published at the reporting date and negative exposures are measured considering the Group's own default risk.

Liabilities not measured at fair value

The fair values correspond to the carrying amounts for all financial assets and liabilities, with the exception of those stated below and the liabilities from redeemable non-controlling interests. Actuarial valuation methods are used to determine the fair value of financial instruments for which no active market is available. The parameters relevant to valuation for determining fair value are based in part on forward-looking assumptions.

in EUR thousand	Valuation category IFRS 91)	Fair Value 30.06.2019	Fair Value 31.12.2018	Level
Liabilities
Corporate Schuldschein loan	AC	233,584	229,877	3

1) AC (At cost)

The fair value of the corporate Schuldschein loan was determined by discounting the contractual payment streams with current interest rates. The comparable interest rates at the reporting date were derived from capital market yields with matching maturities and then adjusted for current risk and liquidity costs that are observable on the market. These comparable interest rates were derived based on management's current assessment of the rating of the Semperit Group.

For information on the valuation of liabilities from redeemable non-controlling interests, please refer to the explanations in the consolidated financial statements at 31 December 2018.

5. Equity

5.1.Dividends

For the year 2018 no dividend payment was made in the first half of 2019. In 2018 also no dividend payment was made.

5.2.Non-controlling interests

Further stakes in Latexx Partners Berhad (0.01%, H1 2018: 0.004%) were acquired during the first half of 2019 in the amount of EUR 2 thousand (H1 2018: EUR 5 thousand). As of 30 June 2019 Semperit holds 98.86% of the shares after 98.85% as of 31 December 2018.

6. Other

6.1.Related-party transactions with companies and individuals

Outstanding balances and transactions between Semperit AG Holding and its subsidiaries were eliminated in the course of consolidation and are not further discussed here.

B & C Semperit Holding GmbH is the direct majority shareholder of Semperit AG Holding, and the private foundation B & C Privatstiftung is the dominant legal entity. B & C Holding Österreich GmbH is the indirect majority shareholder that draws up and publishes consolidated financial statements which include the Semperit Group. According to IAS 24, B & C Privatstiftung and all its subsidiaries, joint ventures and associates are related parties of the Semperit Group.

Related parties of the Semperit Group include the members of the Management and Supervisory Boards of Semperit AG Holding, the managing directors and Supervisory Board members of all companies which directly or indirectly hold a majority stake in Semperit AG Holding, and finally the members of the Management Board of B & C Privatstiftung and the close family members of these Management and Supervisory Board members and managing directors

Business relations with related companies in the first half of 2019 are as follows:

The Group recorded expenses amounting to EUR 256 thousand with unit-it GmbH in the first half of 2019 (H1 2018: EUR 346 thousand). These expenses relate to the maintenance of SAP licences and were conducted at arm's length conditions. There are no liabilities at 30 June 2018 (31 December 2018: EUR 0 thousand) towards unit-it GmbH.

Expenses amounting to EUR 44 thousand were recorded with Grohs Hofer Rechtsanwälte GmbH & Co KG in the first half of 2019 (H1 2018: EUR 17 thousand). These expenses relate to consulting services and were conducted at arm's length conditions. There are no liabilities at 30 June 2019 (31 December 2018: EUR 3 thousand) towards Grohs Hofer Rechtsanwälte GmbH & Co KG.

Expenses amounting to EUR 35 thousand were recorded with B & C Industrieholding GmbH in the first half of 2019 (H1 2018: EUR 29 thousand). These expenses relate to management and other services, and internal charging, and were conducted at arm's length conditions. There are no liabilities at 30 June 2019 (31 December 2018: EUR 39 thousand) towards B & C Industrieholding GmbH.

Expenses amounting to EUR 176 thousand were recorded with B & C Holding GmbH in the first half of 2019 (H1 2018: EUR 707 thousand). These expenses relate to the commitment fee for the hybrid capital line and were conducted at arm's length conditions. The group raised EUR 130 million in hybrid capital from B & C Holding GmbH in March 2018 (see 5.2). There are liabilities amounting to EUR 88 thousand at the reporting date of 30 June 2019 (31 December 2018: EUR 0 thousand) towards B & C Holding GmbH. As of 30 June 2018 the accrued and not paid interest coming from the hybrid capital amounted to EUR 8,778 thousand.

Transactions with the associate Synergy Health Allershausen GmbH mean that the following assets and liabilities existed at 30 June 2019 and 31 December 2018 and/or the following income and expenses were received and incurred in the first halves of 2019 and 2018:

in EUR thousand	H1 2019	H1 2018
Other operating expenses	48	70
Financial income	3	3
	30.06.2019	30.06.2018
Other financial assets	563	563
Trade payables	8	13

The remaining business relationships with other related parties are, where applicable, insignificant and are conducted on normal business terms and conditions.

6.2.Other commitments and risks

Legal disputes

The other provisions include a provision for transaction taxes in Brazil in respect of the assessment years 2008–2010 in the amount of EUR 7,453 thousand (31 December 2018: EUR 6,768 thousand). The duty (PIS/COFINS) is levied on the import and resale of goods in Brazil.

With regard to the import PIS/COFINS, there are indications in the lengthy administrative instances that the decision may ultimately be positive. However, until a final decision is reached, due to the legal uncertainties management continues to assume that the levy will be due until further notice. For the resale PIS/COFINS, a deposit was made in the financial year 2017 after unsuccessful appeals in the administrative proceedings for the further handling of the case in the courts. The provision in the amount of EUR 3,427 thousand is accompanied by a corresponding demand from any reimbursement claims. Furthermore, provisions were formed for expected litigation costs in connection with the tax proceedings in Brazil in the amount of EUR 1,205 thousand (31 December 2018: 1,250 thousand). For the assessment years 2011 and 2012, management is assuming that the period of limitation has expired.

6.3.Events after the repoting date

On the 12 February 2019 a fire in the mixing department of Sempertrans India Pte. Ltd. destroyed production facilities as well as inventories which were stored there. The reimbursement from the property damage and business interruption insurance presented a contingent asset as of 30 June 2019. The approval of the insured damage by the insurance company happened during the time of the preparation of the financial statements.

Vienna, 13 August 2019

The Management Board

Dr. Martin Füllenbach Chairman

Dipl.-Kfm. Frank Gumbinger Chief Financial Officer

Dr.-Ing. Dipl.-Wirtsch.-Ing. Felix Fremerey Member of the Board

Statement of all legal representatives

We confirm to the best of our knowledge that the interim financial statements give a true and fair view of the assets, liabilities, financial position and profit or loss of the group as required by the applicable accounting standards and that the group management report gives a true and fair view of important events that have occurred during the first six months of the financial year and their impact on the interim financial statements, of the principal risks and uncertainties for the remaining six months of the financial year and of the major related party transactions to be disclosed.

Vienna, 13 August 2019

The Management Board

Dr. Martin Füllenbach

Chairman

Dipl.-Kfm. Frank Gumbinger Chief Financial Officer

Dr.-Ing. Dipl.-Wirtsch.-Ing. Felix Fremerey Member of the Board

Contact

Semperit AG Holding

Modecenterstrasse 22 1031 Vienna, Austria Tel.: +43 1 79 777-0 Fax: +43 1 79 777-600 www.semperitgroup.com

Investor Relations

Agnes Springer Tel.: +43 1 79 777-213 www.semperitgroup.com/ir

Addresses of the Semperit Group

www.semperitgroup.com/de/kontakt

Imprint

Media owner: Semperit Aktiengesellschaft Holding, Modecenterstrasse 22, 1031 Vienna, Austria. Produced in-house with firesys GmbH, www.firesys.de

Disclaimer

The terms "Semperit" or "Semperit Group" in this report refer to the group; "Semperit AG Holding" or "Semperit Aktiengesellschaft Holding" is used to refer to the parent company (individual company).

We have prepared this report and verified the information it contains with the greatest possible care. Nevertheless, rounding, typesetting and printing errors cannot be ruled out. Rounding of differences in the summation rounded amounts and percentages may arise from the automatic processing of data.

The forecasts, plans and forward-looking statements contained in this report are based on the knowledge and information available and the assessments made at the that this report was prepared (editorial deadline: 22 August 2018). As is true of all forward-looking statements are subject to risk and uncertainties. As a result, actual events may deviate significantly from these expectations. No liability whatsoever is assumed for the accuracy of projections or for the achievement of planned targets or for any other forward-looking statements. Words such as "expect," "anticipate," "includes," "plan," "assumes," "projects," "intends," "should," "will," "shall," or variations of such words are generally part of forward-looking statements.

Furthermore, there is no guarantee that the contents are complete.

Statements referring to people are valid for both men and women.

This report has been written in German and English. In case of doubt, the German version shall take precedence.

Financial Calendar 2019
14.08.2019	Half-year financial report 2019
21.11.2019	Report on the first three quarters 2019

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