Letter from the Management Board

Ladies and Gentlemen,

In 2016, ALTANA again achieved profitable growth and at the same time paved the way for a sustainable and successful future.

In an environment that was anything but easy, we generated operating growth of two percent and, notwithstanding a divestment and negative exchange-rate effects, also recorded nominal sales growth.

We did so with a healthy mixture of continuity and change. In March, we sold ACTEGA Colorchemie, which can now develop significantly better within the Siegwerk group. Conversely, in July we acquired Addcomp Holland B.V., adding two new sites to our BYK division.

At the same time, we continued to invest above-average amounts in research and development amounting to six percent of sales. Examples of the targeted expansion of our innovation activities are the doubling of the laboratory capacities of ACTEGA Rhenania in Grevenbroich and the inauguration of our cross-divisional Printed Electronics center at ELANTAS in Hamburg.

In the future, we will continue to rely on the innovative ability and other strengths that characterize our company: our proximity to customers, our focus on leading positions in growing specialty chemicals markets, and our corporate culture, which includes the ability to change that ALTANA has successfully demonstrated time and time again.

To exploit ALTANA’s potential even better in the long run, we developed an agenda for the future together with the Executive Management Team in the first months of 2016. In the process, we took into account feedback we received from managers and employees from the entire organization. Under the motto “Keep Changing,” our agenda depicts the strategic thrusts that will be crucial for ALTANA’s further development in the next five to ten years.

With this step, we are actively shaping our future in an environment that will continue to offer manifold opportunities, as well as challenges. In the coming years, we anticipate restrained worldwide economic growth overall, as well as the possibility to stand out from this trend as an innovation-driven specialty chemicals company.

With the Keep Changing Agenda, we are creating the prerequisites for accelerating our growth, especially under our own steam. We want to create sustainable value – for our customers, employees, our shareholder, and society as a whole. We consistently align our entire organization accordingly. And we want to advance our capabilities to the next level. This includes leveraging digitization at ALTANA. In mid-2016, we created the new Digital Transformation department for this purpose.

The people at ALTANA are the key to our success. They are the ones who effect and shape changes and experience them as personal enrichment. To tap our potential completely, however, we need even more diversity and mobility within the ALTANA Group. Thus, we are paying particular attention to further promoting talent consistently around the world.

Finally, we want to differentiate ourselves from the competition to an even greater extent through innovations, but also increasingly through sustainability, beyond our products and our customers’ manufacturing processes. Outside of our laboratories, too, we can only be successful in the long run if we firmly anchor ecological and social aspects in our company. This is our understanding of sustainability and we have ourselves measured on this basis.

The fact that we received the Gold Status in the renowned EcoVadis sustainability rating shows that we have already achieved a high standard. In 2016, we further improved all our key accident figures compared to the previous year. Above all, the lost work time due to accidents was significantly reduced. We also continued to improve our environmental key figures in the divisions. To the same extent to which we are advancing economically, we want to steadily optimize our results in the areas of environmental protection and safety. Hence, we are setting ourselves increasingly ambitious goals in these fields, too.

ALTANA’s first integrated Annual and Sustainability Report is an expression of our definition of sustainability, according to which the three dimensions of economy, ecology, and social commitment are inextricably intertwined. As a member of the U.N. Global Compact, the world’s most important and largest initiative promoting responsible corporate management, ALTANA actively supports the goals of this undertaking.

The foundations of our actions are the health and safety of our employees. On this basis, we strive to ensure that our customers are successful and satisfied. In doing so, we consider the effects of our activities on the entire value chain, the environment, and society as a whole. You can read about how people at ALTANA concretely implement this awareness of sustainable thinking and action in the magazine section of this report.

We would like to warmly thank our employees for their contribution to the success and development of ALTANA in the 2016 fiscal year. Thanks also go to the members of the Supervisory Board for their constructive accompaniment and their trust in ALTANA’s work.

Martin Babilas     Stefan Genten     Dr. Christoph Schlünken