Financial Report – Consolidated financial statements

Consolidation scope and principles

Consolidation scope

The consolidated financial statements are presented in Euros and include all domestic and foreign com­panies which Zehnder Group AG controls directly or indirectly either by holding more than 50% of the voting rights or by otherwise having the power to control their operating and financial policies. Assets and liabilities as well as revenues and expenses are included at 100% in accordance with the full consolidation method. Minority interests in equity and in net profit of fully consolidated companies are recognised separately.

Holdings with a voting interest of between 20 and 49% (associated companies) are included in accordance with the equity method. Consolidated equity and the financial result for the period are accounted for proportionately.

The following changes were made in the consolidation scope compared to the previous year:

• Merger of ELP SCI into Filtech France SARL as of 1 January 2025 in France;
• Renaming of Filtech France SARL into Filtech France SAS as per 4 July 2025 in France;
• Renaming of Zehnder Corporate Americas, Inc. into Zehnder Group North America Inc. as per 29 September 2025 in the USA.

Consolidation principles

General

Zehnder Group prepares its financial statements in accordance with the existing guidelines of Swiss GAAP FER (Swiss Accounting and Reporting Recommendations).

The consolidated balance sheet and income statement are based on the financial statements of the companies as defined in the consolidation scope for the year ended 31 December.

The data presented in the consolidated financial statements are based on uniform accounting and valuation principles which apply to all Group companies.

Intergroup receivables and payables as well as revenues and expenses are eliminated in the consolidated statements. Intermediate profits in inventories are eliminated as well.

Foreign currency translation

For the year under review, the financial statements of subsidiaries which report in currencies other than the euro were translated into euros (EUR) as follows:

• Balance sheet figures at year-end exchange rates;
• Income statement figures at average exchange rates for the year;
• Cash flow statement figures at average exchange rates for the year.

Differences arising from applying these disparate exchange rates as well as foreign exchange differences on long-term loans of an equity nature to Group companies were booked to the cumulative translation differences of the consolidated equity capital. Foreign currency differences arising from repayments of long-term loans of an equity nature are also booked to consolidated equity capital and are not transferred to the income statement until such time as a disposal takes place.

The principal rates of exchange used for consolidation are shown in the table below.

Capital consolidation

Capital is consolidated to show equity capital as if the Group were one single company. To do this, it is necessary to offset the net worth of consolidated companies against the capital allotted to them.

Assets acquired and liabilities assumed are recognised as of the date when control is obtained and measured at their acquisition-date fair values. Intangible assets not previously recognised by the acquiree, but significant to the acquisition decision, are identified and recognised. Any residual goodwill is subsequently offset against equity of the Group.

In the case of a gradual acquisition, each step of the acquisition is accounted for separately. The assets and liabilities acquired at each stage are recognised at their fair values as of the respective acquisition dates. When control is ultimately obtained, the previously held equity interests are remeasured at fair value, and any resulting gain or loss is recognised in the income statement. The cumulative fair value of the identifiable net assets acquired and the consideration paid are used to determine the goodwill, which is subsequently offset against the equity of the Group.