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"},{"text":"Group Profi le 2019
ALTANA’s divisions Sales by region
1
4
38.2 % 27.6 % 2
1.7 % 32.5 % 3
in € million 2019
1 Europe 858.0
2 Americas 620.6
3 Asia 731.8
4 Other regions 38.6
Total 2,248.9
Sales by division
1
4
2
3
15.8 %
22.0 %
46.3 %
15.9 %
in € million 2019
1 BYK 1,040.6
2 ECKART 356.2
3 ELANTAS 494.5
4 ACTEGA 357.7
Total 2,248.9
"},{"text":" Group Profi le 2019
Key figures at a glance
2018 2019 %
in € million
Sales 2,307.4 2,248.9 - 3
Earnings before interest, taxes, depreciation and amortization (EBITDA) 430.6 415.8 - 3
EBITDA margin 18.7 % 18.5 %
Operating income (EBIT) 295.8 262.5 - 11
EBIT margin 12.8 % 11.7 %
Earnings before taxes (EBT) 264.1 231.3 - 12
EBT margin 11.4 % 10.3 %
Net income (EAT) 187.0 169.0 - 10
EAT margin 8.1 % 7.5 %
Research and development expenses 154.1 165.6 7
Capital expenditure on intangible assets and property, plant and equipment 187.0 157.2 - 16
Cash Flow from operating activities 296.2 386.3 30
Return on capital employed (ROCE) 9.4 % 8.8 %
ALTANA Value Added (AVA) 37.6 21.6 - 43
Dec. 31, 2018 Dec. 31, 2019 %
in € million
Total assets 3,221.9 3,343.3 4
Shareholders’ equity 2,344.6 2,479.4 6
Net debt (-) / Net financial assets (+) ¹ (95.6) (57.7) 40
Headcount ² 6,428 6,476 1
¹ Comprises cash and cash equivalents, current financial assets, marketable securities, loans granted, debt, and employee benefit obligations.
² When in the following the term “headcount” or “employees” is used, it refers to all staff members, male, female, or otherwise.
Due to rounding, this Corporate Report may contain minor differences between single values, and sums or percentages.
2018 2019 %
WAI 1 (number of occupational accidents with lost work time of one day or more
per million working hours)
3.7 2.8 - 24
WAI 2 (number of occupational accidents with lost work time of more than three days
per million working hours)
2.7 2.1 - 22
WAI 3 (number of lost work days due to occupational accidents per million working hours) 36.5 34.8 - 5
CO² total (Scope 1 + Scope 2) ³ (t) 193,085 181,924 - 6
CO² specific (Scope 1 + Scope 2) ³ (kg CO² / € gross value added) 0.21 0.20 - 5
CO² specific (Scope 1 + Scope 2) ³ (kg CO² / kg finished goods) 0.34 0.35 3
³ Scope1: direct emissions; Scope 2: indirect emissions
"},{"text":"Group Management Report
46
Products
81
Safety and Health
85
Environment
89
Human Resources
93
Social
Commitment
96
Consolidated Financial
Statements
99
Table of Contents
Letter from the Management Board
About This Report
Sustainability Management
Corporate Governance
Corporate Bodies and Management
Report of the Supervisory Board
Looking to the Future
Group Management Report
Group Basics
Business Development
Innovation and Employees
Subsequent Events
Expected Developments
Products
Safety and Health
Environment
Human Resources
Social Commitment
Consolidated Financial Statements
(condensed version)
Management Board Responsibility Statement
ALTANA Group Consolidated Income Statement
ALTANA Group Consolidated Statement of Financial Position
ALTANA Group Consolidated Statement of Cash Flows
Reference to the Consolidated Financial Statements
Multi-Year Overview
Global Compact: Communication on Progress (COP)
1
6
7
11
14
16
21
46
47
53
66
70
71
81
85
89
93
96
99
100
101
102
104
106
108
110
Legal Disclaimer
This Corporate Report is a translation of the Unternehmensbericht. The translation was prepared for
convenience only. In case of any discrepancy between the German version and the English translation, the
German version shall prevail.
This report contains forward-looking statements, i. e. current estimates or expectations of future events or
future results. The statements are based on beliefs of ALTANA as well as assumptions made by andinfor -
mation currently available to ALTANA. Forward-looking statements speak only as of the date they are made.
ALTANA does not intend and does not assume any obligation to update forward-looking statements to
refl ect facts, circumstances or events that have occurred or changed after such statements have been made.
Group Profi le 2019
Key figures at a glance
2018 2019 %
in € million
Sales 2,307.4 2,248.9 - 3
Earnings before interest, taxes, depreciation and amortization (EBITDA) 430.6 415.8 - 3
EBITDA margin 18.7 % 18.5 %
Operating income (EBIT) 295.8 262.5 - 11
EBIT margin 12.8 % 11.7 %
Earnings before taxes (EBT) 264.1 231.3 - 12
EBT margin 11.4 % 10.3 %
Net income (EAT) 187.0 169.0 - 10
EAT margin 8.1 % 7.5 %
Research and development expenses 154.1 165.6 7
Capital expenditure on intangible assets and property, plant and equipment 187.0 157.2 - 16
Cash Flow from operating activities 296.2 386.3 30
Return on capital employed (ROCE) 9.4 % 8.8 %
ALTANA Value Added (AVA) 37.6 21.6 - 43
Dec. 31, 2018 Dec. 31, 2019 %
in € million
Total assets 3,221.9 3,343.3 4
Shareholders’ equity 2,344.6 2,479.4 6
Net debt (-) / Net financial assets (+) ¹ (95.6) (57.7) 40
Headcount ² 6,428 6,476 1
¹ Comprises cash and cash equivalents, current financial assets, marketable securities, loans granted, debt, and employee benefit obligations.
² When in the following the term “headcount” or “employees” is used, it refers to all staff members, male, female, or otherwise.
Due to rounding, this Corporate Report may contain minor differences between single values, and sums or percentages.
2018 2019 %
WAI 1 (number of occupational accidents with lost work time of one day or more
per million working hours)
3.7 2.8 - 24
WAI 2 (number of occupational accidents with lost work time of more than three days
per million working hours)
2.7 2.1 - 22
WAI 3 (number of lost work days due to occupational accidents per million working hours) 36.5 34.8 - 5
CO² total (Scope 1 + Scope 2) ³ (t) 193,085 181,924 - 6
CO² specific (Scope 1 + Scope 2) ³ (kg CO² / € gross value added) 0.21 0.20 - 5
CO² specific (Scope 1 + Scope 2) ³ (kg CO² / kg finished goods) 0.34 0.35 3
³ Scope1: direct emissions; Scope 2: indirect emissions
"},{"text":"Management Board
Dear Ladies and Gentlemen,
In 2019, ALTANA mastered a challenging market environment and at the same time
took major strides in setting the course for our long-term growth. Due to the economic
headwind, we were not able to achieve our ambitious sales and earnings targets, but
we once again succeeded in demonstrating ALTANA’s financial and innovative strength.
In order to remain on a sustainable success path, we invested heavily in the future.
While our ACTEGA division continued on its growth path due to the good demand for
coating and packaging solutions from consumer-related customer industries, the ALTANA
Group’s overall sales and earnings lagged behind the strong level of the previous year.
This development was driven by sluggish demand from key industrial sectors, especially
the automotive industry, as well as by the general economic slowdown, especially
in China. Nevertheless, the EBITDA margin remained within the long-term target range
of 18 to 20 percent, despite substantial spending on research and development and
digitalization.
In 2019, we continued to push forward the development of promising technologies to
pave the way for future profitable growth. For instance, the up-and-coming 3D printer
manufacturer dp polar, in which ALTANA has held a stake since 2017, used our material
development knowhow to present a 3D printing solution that offers customers from
a wide range of sectors, including the automotive, aerospace, and medical technology
industries, completely new possibilities for manufacturing their products. The positive
feedback from potential users at the world’s largest 3D printing tradeshow Formnext confirmed
the high potential of this technology.
ALTANA’s internal startup ACTEGA Metal Print is also about to launch a promising technology
on the market. The technology enables packaging to be metallized with substantially
less material and considerably lower costs and production time than conventional
methods. The Printed Electronics technology platform, meanwhile, succeeded in developing
a technically sophisticated product portfolio for conductive inks and initiated the
first customer projects following intensive research and development at the ELANTAS site
in Hamburg.
"},{"text":"2 Letter from the Management Board
ALTANA’s Management Board from left to right:
Stefan Genten, Martin Babilas (Chairman), Dr. Christoph Schlünken
"},{"text":"Letter from the Management Board 3
In order to keep the innovation and sales pipeline well filled, ALTANA continues to make
above-average investments in its research and development activities, representing
7 percent of the company’s total sales. In addition, we made a number of targeted acquisitions
in 2019. We acquired the wire enamels business of Hubergroup India Private Ltd.,
thereby strengthening our ELANTAS division in this growth market. And with the agreed
upon acquisition of the Swiss overprint varnish specialist Schmid Rhyner AG, we con-
tinue to strategically expand our ACTEGA division.
BYK-Gardner – the testing and measuring instrument specialist within the ALTANA
Group – acquired, among other things, refinish color matching and formulation software
and can now offer its customers a complete solution from a single source. BYK-Gardner
is thus making targeted use of the market trend toward digitalization. This is one of the
reasons why the ALTANA Group’s first online stores went live in 2019, not only at
ACTEGA but also at BYK-Gardner.
We are also making headway in the digital transformation in many other areas of our
company. Above all, we are creating an infrastructure that will enable us to be successful
in the digital age. For instance, BYK is investing 15 million euros alone in an innovative
high throughput screening facility in Wesel. With it, tests can be carried out with enormous
speed and efficiency at the highest level of quality.
In order to facilitate future growth, we pushed ahead with the expansion of our sites and
production capacities in all regions of the world in 2019. In April, a new integrated
BYK site opened in Shanghai, and in June, a new ACTEGA innovation center went into
operation in Grevenbroich. Currently ALTANA is significantly expanding the BYK site in
Gonzales, Texas, and the ACTEGA site in Bremen, Germany. And expansion projects are
also underway in Deventer in the Netherlands and Tongling in China.
In all our efforts to increase our capacities and develop our sites worldwide, we also keep
a close eye on ecological aspects and, above all, the safety of our employees. As a
result, we were able to significantly reduce the number of accidents in our company worldwide
in the past fiscal year as well. At the same time, we succeeded in further reducing
"},{"text":"4 Letter from the Management Board
CO² emissions. In order to continue to take responsibility for climate protection in the
future, we developed an ambitious program in 2019: ALTANA will become climate-
neutral in its direct sphere of influence starting as early as 2025, thus achieving targets
that are in line with the goals of the UN Global Compact initiative for responsible and
sustainable corporate management, which we joined in 2010. We are consistently pursuing
our sustainability course, having already achieved in 2017 the goal we set ourselves
in 2007 of reducing CO² emissions by 30 percent of gross value added by 2020.
These examples reflect the long-term nature of ALTANA’s activities. We are not guided by
short-term trends, but instead focus on moves that will strengthen our company in
the long term and thus create value for our customers, employees, owner, and society as
a whole. In the magazine section of this report, you can find out more about the areas
in which we are already paving the way for future success and how the long-term course
of the past years is already paying off. This has been made possible by ALTANA’s finan-
cial and innovative strength and, in particular, by the people in our company, who fill our
sustainable growth strategy with life.
We would like to warmly thank our employees for their contribution to the success
and development of ALTANA in the 2019 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\t Stefan Genten \t Dr. Christoph Schlünken
"},{"text":"6
7
11
14
16
20
About This Report
Sustainability Management
Corporate Governance
Corporate Bodies and Management
Report of the Supervisory Board
Looking to the Future
"},{"text":"About This Report
Corporate Report 2019
The Corporate Report for 2019 encompasses the annual and
sustainability reports. With it, the ALTANA Group informs
the public, its employees and business partners, as well as
public authorities, nongovernmental organizations, and
all other interested parties about the Group’s development in
economic, ecological, and social respects. In addition to the
Group Management Report and the Consolidated Financial
Statements (condensed version), as well as information on
the Group’s corporate governance, this report contains a description
of ALTANA’s understanding of sustainable man-
agement and the progress the Group has made in implement-
ing it in the past fiscal year. As a result, this report for
2019 updates the content that was published in the 2018
Corporate Report (published on March 15, 2019). At
the same time, it serves as the annual Communication on
Progress of Global Compact.
The Reporting Period
All financial and human-resource information in the Group
Management Report and the Consolidated Financial Statements
for 2019, as well as the environmental key performance
indicators and data on occupational health and safety,
refer to the period from January 1 to December 31.
Reporting Principles
In terms of the Group Management Report and the Consolidated
Financial Statements, the reporting adheres to the
specifications of the International Financial Reporting Standards
(IFRS), as adopted by the EU, and the additional requirements
of German commercial law pursuant to section
315 e of the German Commercial Code (HGB). As in the
previous years, this was audited and confirmed by an independent
auditor. The complete Consolidated Financial Statements
including the Notes to the Consolidated Financial
Statements are available online at www.altana.com/consolidated_
financial_statements_2019.
This corporate report has been prepared in accordance
with the GRI Standards: Comprehensive option. It is also oriented
to the International Integrated Reporting Council’s
(IIRC) reporting framework. In 2019, ALTANA did not have the
key performance indicators based on the standards of
the Global Reporting Initiative (GRI) tested by an independent
auditor. Detailed information is available online at
www.altana.com/facts_figures_sustainability_2019.
Information on the selection of content based on GRI
Standards and regarding the definition of sustainability issues
important for the ALTANA Group and its stakeholders can
be found in the “Sustainability Management” section (page 7
of this report). A detailed list of all criteria based on the GRI
Standards that ALTANA provides information about is avail-
able online at www.altana.com/facts_figures_sustain-
ability_2019.
This report is available in German and English.
6 About This Report
"},{"text":"ALTANA’s Understanding of Sustainability
ALTANA consistently gears its activities to sustained profitable
growth. But we can only achieve economic success in the
long run if we also bear in mind ecological and social aspects
and anchor them firmly in our company.
Our understanding of sustainability as a triad of economy,
ecology, and corporate social responsibility is also reflected
in ALTANA’s mission:
We provide innovative solutions based on integrated chemical,
formulation, and application expertise that make products of
daily life better and more sustainable.
Our solutions open up growth or savings potential for our
customers and can change entire markets.
As a result, we create value for our customers, employees,
shareholder, and society as a whole.
The View of Our Stakeholders
As a globally manufacturing specialty chemicals company,
ALTANA has diverse stakeholders with whom the Group and
its different companies maintain regular contact and exchange.
The content and results of these dialogs are among
the factors that inform ALTANA’s understanding of sustainability.
Among ALTANA’s most important stakeholders are
its customers, employees, owner, suppliers, other business
partners, authorities, associations, and nongovernmental
organizations (NGOs), as well as our neighbors at the different
sites.
In the year under review, the stakeholder analysis
we performed in 2017 was examined and the key sustain-
ability issues were still considered relevant for ALTANA.
ALTANA’s Environment, Health & Safety (EH&S) and Corporate
Communications departments developed with external
support a materiality matrix with 13 criteria.
In the matrix, all topics relating to the GRI Standards,
existing stakeholder analyses, ALTANA’s Keep Changing
Agenda for the future, as well as selected best practices in
the form of reports and studies were considered.
In the process of developing the materiality matrix,
topics were prioritized based on their relevance to stakeholder
decisions and the consequences for the ALTANA Group
(see graphic on the following page).
The stakeholders incorporated in the materiality matrix,
which were identified based on high relevance, came from
the areas of customers, suppliers, NGOs, foundations, politics,
and institutions. Internally, EH&S, Corporate Communications,
Strategy, Procurement, Research and Development,
Finances and Controlling, Engineering, and Sales were in-
corporated. ALTANA will continue to review the materiality
matrix and update it if necessary.
Objective Evaluation of Sustainability
To be able to measure not only the company’s business
performance but also its involvement in all areas of sustain-
ability, alongside key performance indicators and certi-
fied management systems, ALTANA is using objective external
evaluations increasingly. The assessments of the chem-
ical industry rating company EcoVadis play a special role. In
2019, the companies BYK Netherlands B.V., ACTEGA
North America Inc., and ACTEGA Terra GmbH were evaluated
by EcoVadis. As a result, ALTANA continued its series of
assessments.
EcoVadis, which analyzes environmental aspects, procurement
policy, compliance, and working conditions of
companies based on the international sustainability guideline
Sustainability Management
Sustainability Management 7
"},{"text":"Reduction of effluents
and waste
Direct economic value for customers,
employees, owner, and society as a whole
Innovative solutions to exploit growth
and savings potential for customers
Significance – perspective of ALTANA
energy, sustainability performance, environmental key performance
indicators), and present best-practice models.
Sustainable Development Goals
ALTANA has been a member of the UN Global Compact
since 2010 and commits to integrating the ten principles
into the company and to observing the general goals of
the United Nations (see the Communication on Progress
of Global Compact on page 110).
At the summit meeting on September 25, 2015, the
193 member states resolved the 2030 Agenda for Sus-
tainable Development. ALTANA supports this United Nations
initiative and developed the goals listed on page 10.
8 Sustainability Management
ALTANA Materiality Matrix
Significance – perspective of external stakeholders
Renewable and
recycled materials
ISO 26000, has become one of the world’s leading rating
platforms for the chemical industry. More than 20,000 companies
are now registered with it.
Organization of Sustainability
At ALTANA, the Group’s operating companies are responsible
for implementing and anchoring sustainability. The indivi-
dual companies are committed to continually reducing the
environmental effects of the Group and to improving safety
at the respective sites. Furthermore, the individual sites are
required to introduce suitable management systems and
have them certified.
Moreover, special, cross-divisional expert platforms
exchange information on relevant EH&S topics (for example
Health and safety of customers
Clean energy and greenhouse
gas emissions reduction
Occupational health and safety
Responsible supply chain
management
Compliance
Diversity and equal
opportunity
Attracting and maintaining a skilled workforce
Employee-oriented management
Water efficiency
"},{"text":"Descriptions, objectives, and results of the Sustainable
Development Goals defined for ALTANA can be found in the
chapters of the 2019 Corporate Report indicated
and in
the online document “Facts and Figures on Sustainability
2019.”
UN Sustainable Development Goals (SDG s)
Sustainability Management 9
"},{"text":"SDG s with special relevance for ALTANA
Occupational Health and Safety
For ALTANA, the health and safety of its em-
ployees is a top priority. All of its worldwide
sites have established their own safety organization,
which includes adherence to all local
occupational safety regulations, training measures,
as well as recording and evaluating
accidents and near accidents. ALTANA uses the
Work Accident Indicator (WAI) as the most important key perfor-
mance indicator in order to observe the development of occupational
safety at all sites and to continually improve it. Further information
can be found in the “Health and Safety” chapter, in the accident key
performance indicators with the targets, as well as in the Management
Approach “Occupational Health and Safety.”
Training and Education
Our employees are our most important re-
source. ALTANA therefore promotes their professional
development, prepares them for
leadership positions, and enables them to participate
in the company’s economic success
in order to retain them in the long term. A special
focus is on recruiting young, specialized,
and managerial staff. Further information can be found in the “Human
Resources” chapter, in the GRI Content Index, and in the Management
Approach “Employee-Oriented Management.”
Gender Equality
Promoting women in leadership positions
remains a focus at ALTANA. By founding a
number of initiatives, including LEADING
WOMEN @ ALTANA and Mentoring for Women,
ALTANA seeks in the medium term to in-
crease the share of women in leadership positions
to the percentage of women among
all the company’s employees. Further information can be found in the
“Human Resources” chapter, in the Group Management Report, in
the human resources key performance indicators, and in the Manage-
ment Approach “Employee-Oriented Management.”
Sustainable Economic Growth
and Decent Work
Our customers’ success is at the center of
ALTANA’s business activities. We can only
be successful in the competitive environment
in the long run if we offer our customers
added value. We not only aim to secure longterm
economic success, but to act sustainably
in every respect. As a member of the UN Global Compact, ALTANA
therefore actively supports the targets of responsible corporate management.
Further information can be found in the Group Management
Report, in the Communication on Progress of the UN Global Compact,
and in the Management Approaches “Strategy,” “Compliance,” and
“Employee-Oriented Management.”
Innovation: New Products
and Technologies
ALTANA’s products and services are geared to
offering its customers special sustainable solutions
and to enable them to gain a competitive
advantage. To keep or to extend its position
as a leading specialty chemicals compa-
ny, the ALTANA Group intends to continually
expand its competencies. To achieve this goal, ALTANA steadily grows
its product portfolio through its own developments, as well as through
acquisitions and cooperation with other companies, universities, and
research institutes. Further information can be found in the “Products”
and “Innovation and Employees” chapters, as well as in the Man-
agement Approach “Innovative Solutions.”
Climate Protection Measures
Ecologically sound economic activity is a key
component of ALTANA’s corporate strategy.
Our goal is to continually reduce the energy
consumption and emissions at all of our
sites and to use resources efficiently. In addition,
ALTANA’s products contribute to im-
proving climate protection in the value chain.
ALTANA controls the Group’s efficiency regarding energy consumption
and the resulting CO² emissions with the help of defined performance
indicators and defined targets. Further information can be
found in the “Environment” and “Products” chapters as well as in the
environmental performance indicators with targets in the Manage-
ment Approaches “Energy” and “Emissions.”
10 Sustainability Management
"},{"text":"Corporate Governance
Good corporate governance is an essential basis for the sustainable
success of ALTANA. Even as a company not listed
on the stock exchange, ALTANA orients itself to the recommendations
and suggestions of the German Corporate
Governance Code.
At least once a year, the Supervisory and Management
Boards deal with the German Corporate Governance
Code and examine which recommendations and suggestions
ALTANA can follow even as a company not listed on the
stock exchange and sensibly apply within the company given
its shareholder structure.
In the 2019 fiscal year, ALTANA complied with the
vast majority of the applicable recommendations of the German
Corporate Governance Code in the current version
of February 7, 2017. This especially applies to the recommendations
concerning the cooperation between the Management
Board and the Supervisory Board, the cooperation between
the Chairman of the Supervisory Board and the
Supervisory Board plenum, dealings with conflicts of interest
of the Supervisory Board members, the setting up and
composition of the committees, as well as matters relating
to the audit.
The Management Board dealt intensively with the
amendments to the German Corporate Governance Code
resolved on May 9, 2019, and December 16, 2019, as
well as with the amendment to the German Stock Corporation
Act by the Act Implementing the Second Shareholder
Rights Directive (ARUG II), and in fiscal year 2020 intends to
again chiefly orient itself to the recommendations and
suggestions of the German Corporate Governance Code and
the corporate governance regulations of the German
Stock Corporation Act applicable to companies listed on the
stock exchange.
Management and Control
Corporate Governance 11
The Management Board of ALTANA AG consists of three
members, each of whom are appointed by the Supervisory
Board for a period of five years. The selection criteria include
experience, business and professional expertise, as well
as competence in ecology and social responsibility. Considerations
regarding diversity also play a role in the selection
process. The Management Board manages the Group independently
and is solely committed to the interests of the
company. Together with the presidents of the divisions and
selected heads of central functional areas, the Management
Board forms the Executive Management Team. In regular
meetings, this team discusses and analyzes the development
of business and important business incidents, as well as
plans for the Group’s future development and sustainability
issues.
The company’s Supervisory Board has twelve members.
Half of them are employee representatives, elected by
Group employees in Germany in accordance with the German
Codetermination Act. The remaining six members are basi-
cally elected by the Annual General Meeting. Experience and
expertise, as well as independence, are also important
criteria in the selection of the members of the Supervisory
Board. They are normally elected for a period of five years.
The Management Board reports to the Supervisory Board
regularly, without delay, and comprehensively on all issues
relevant for the company regarding business development,
risks, and planning, and discusses ALTANA’s strategy with
the Supervisory Board. Sustainability issues are also discussed
regularly at the Supervisory Board meetings. The Supervi-
sory Board monitors and advises the Management Board in
its management activities. The Supervisory Board’s tasks
also include approving the annual financial statements. Specially
defined business decisions of the company, such as
major acquisitions and divestments, require the approval of
"},{"text":"the Supervisory Board, in accordance with a list of transactions
that are subject to authorization.
The Supervisory Board formed an Audit Committee,
a Human Resources Committee, and a Mediation Committee,
legally required in accordance with section 27 (3) of the
German Codetermination Act. Each committee consists of
two shareholder representatives and two employee representatives.
The Chairman of the Human Resources Committee
and the Mediation Committee is the Chairman of the
Supervisory Board, Dr. Klaus-Jürgen Schmieder. Dr. Jens Schulte
is the chairman of the Audit Committee. He has the necessary
knowledge and expertise in the fields of accounting and
auditing in accordance with the German Stock Corpora-
tion Act.
There is a D&O liability insurance scheme for members
of the Management and Supervisory Boards. The insurance
covers personal liability risks in the event that a claim is made
against members of the Management and Supervisory
Boards while they are performing their activities. The insurance
contract stipulates a deductible of ten percent of
the damages, but a maximum of one-and-a-half times the
amount of the fixed annual compensation of the respective
member of the Management or Supervisory Board per insurance
year. Further information on the compensation of the
Management and Supervisory Boards can be found on page
73 f. of the online Consolidated Financial Statements.
Compliance
Compliance with laws is the basis for all of ALTANA’s actions.
In addition, we set ourselves certain rules as part of our
corporate social responsibility, which we adhere to like laws.
At ALTANA, compliance is an integral part of our corporate
social responsibility. The trust of our customers, business
partners, employees, and the public is the basis and
condition for our business success.
For this purpose, ALTANA established a Compliance Management
System in 2008. Its goal is to ensure that laws and
the rules we have set ourselves are observed throughout
the Group. To this end, the Compliance Management System
identifies significant risks that can arise from violations of
laws or regulations by ALTANA employees. The Compliance
Management System also ensures that employees are
aware of the content and significance of the laws and regulations
relevant to them and know how to behave best
in light of them. Furthermore, the Compliance Management
System is intended to ensure that the necessary control
mechanisms are implemented so that violations of laws and
regulations can be detected and remedied. The Compli-
ance Management System encompasses eight compliance
areas: corruption, antitrust law, environmental protection
and safety, human resources, customs and foreign trade, data
protection, financial reporting, and taxes.
The ALTANA Compliance Management System follows
the ALTANA structure and is therefore decentralized. The
local management is primarily responsible for making sure
that the individual subsidiaries and their employees behave
in accordance with the rules. ALTANA AG lives up to its compliance
responsibility by providing a framework, making
competencies and instruments available, creating platforms
and forums for local authorities, and by taking concrete
measures to ensure compliance on the part of the management
of subsidiaries or to impose minimum requirements,
especially through guidelines that are binding Group-wide.
ALTANA’s Code of Conduct, which holds for the entire
company, contains binding rules regarding responsible, ethical,
and lawful behavior for all staff members. This applies
in particular to issues such as corruption, conflicts of interest,
antitrust law, environmental protection, and discrimination.
Together with the company’s Guiding Principles, the Code of
Conduct provides orientation for responsible corporate
action. The Code of Conduct and the Guiding Principles are
published on our website (www.altana.com). Since 2010,
12 Corporate Governance
"},{"text":"ALTANA’s employees have been trained with the help of an
e-learning program regarding the content of the Code of
Conduct and further issues relevant to compliance such as
corruption and antitrust law. In 2018, around 4,200 employees
completed the Code of Conduct training program.
Moreover, for each compliance area further specific
measures have been developed and implemented to ensure
that laws and internal regulations are adhered to. This includes,
for example, an IT-assisted system with whose help
business partners that support ALTANA AG and its subsidiaries
in sales or in their cooperation are examined for potential
compliance risks.
Another important element to guarantee the effectiveness
of the Compliance Management System is the work
of Internal Audit. For a few years now, compliance programs
have been carried out regularly at ALTANA and its subsid-
iaries.
With the ALTANA Compliance Hotline, ALTANA provides
another central means of ensuring compliance. The latter
gives employees and external third parties the possibility of
anonymously reporting illegal behavior.
Once a year, the Audit Committee receives a written
report on compliance that is presented and discussed in a
meeting of the committee in addition to the other proceedings.
The report gives an overview of the risks identified
for each compliance area, as well as already implemented or
planned measures to advance the system. The Audit Committee
is also informed about compliance violations in this
context.
ALTANA joined the UN Global Compact initiative, whose
members are voluntarily committed to adhering to social
and environmental standards as well as the protection of human
rights. By joining Global Compact, ALTANA has not
only acknowledged its principles but also shown a general
commitment to support and promote overall UN aims.
Corporate Governance 13
"},{"text":"The Executive Management Team
The Executive Management Team is an advisory body in
which strategic and operative issues that are important for
ALTANA and the divisions are discussed and deliberated
on. In addition to the members of the Management Board,
the Executive Management Team includes the presidents
of the divisions as well as selected executives of the company.
(in alphabetical order)
Jörg Bauer
Vice President Human Resources
Dr. Guido Forstbach
President Division ELANTAS
Thorsten Kröller
President Division ACTEGA
Volker Mansfeld
Head of Corporate Development
Dr. Wolfgang Schütt
President Division ECKART
Dr. Petra Severit
Chief Technology Officer
14 Corporate Bodies and Management
Corporate Bodies and Management
The Management Board
Martin Babilas
Chairman
Responsibility:
– ECKART Division
– ELANTAS Division
– ACTEGA Division
– Corporate Development
– Human Resources
– Environment, Health & Safety
– Corporate Communications
– Internal Audit
Stefan Genten
Responsibility:
– Finance and Accounting
– Controlling
– Corporate Finance / Treasury
– Tax
– Digital Transformation
– Information Technology
– Legal / Patents
– Compliance
– ALTANA Excellence
– Procurement
Dr. Christoph Schlünken
Responsibility:
– BYK Division
– Innovation Management
– Key Account Management
"},{"text":"The Supervisory Board
Dr. Klaus-Jürgen Schmieder
Chairman
Ulrich Gajewiak ¹
Deputy Chairman
Susanne Klatten
Deputy Chairwoman
Dr. Anette Brüne ¹
Dr. Monika Engel-Bader
Armin Glashauser ¹
Klaus Koch ¹
Beate Schlaven ¹
Dr. Jens Schulte
Stefan Soltmann ¹
Dr. Antonio Trius
Dr. Matthias L. Wolfgruber
Corporate Bodies and Management 15
Supervisory Board Committees
The Supervisory Board of ALTANA AG has established
the following committees:
Human Resources Committee
Dr. Klaus-Jürgen Schmieder (Chairman)
Ulrich Gajewiak
Susanne Klatten
Beate Schlaven
Audit Committee
Dr. Jens Schulte (Chairman)
Armin Glashauser
Stefan Soltmann
Dr. Antonio Trius
Mediation Committee
(in accordance with section 27 (3) of the German
Codetermination
Act)
Dr. Klaus-Jürgen Schmieder (Chairman)
Ulrich Gajewiak
Susanne Klatten
Klaus Koch
¹ Employee representative
As of December 31, 2019 in each case; details on the corporate bodies
can be found in the online Consolidated Financial Statements
(www.altana.com /consolidated_financial_statements_2019) page 76 ff.
"},{"text":"Report of the Supervisory Board
The Supervisory Board of ALTANA AG, carrying out the functions stipulated by law and the
Articles of Association, closely followed the work of the Management Board again in 2019
and monitored its management activities. The Supervisory Board dealt in depth with the
situation and development of the company as well as with various current issues. The Supervisory
Board was regularly informed by the Management Board about the respective agenda
items through presentations and oral reports in meetings. The Supervisory Board also regularly
received additional written reports. Between Supervisory Board meetings, the Chairman
of the Management Board informed the Chairman of the Supervisory Board about significant
developments and events, and discussed pending or planned decisions with him. The Supervisory
Board was involved in all major company decisions.
Meetings of the Supervisory Board
In the 2019 fiscal year, the Supervisory Board held four regular meetings and one constitutive
meeting. At the regular meetings, the economic situation and the development perspectives
of the ALTANA Group, as well as important business events, were discussed and deliberated
on in detail. In addition to regular reporting on ALTANA’s sales, earnings, and financial
development, the Supervisory Board dealt in depth with the strategy of ALTANA and its individual
divisions. Furthermore, the Supervisory Board intensively discussed the situation,
development, and plans of the ELANTAS and ACTEGA divisions as well as that of ACTEGA
Metal Print GmbH, in the 2019 fiscal year. The Supervisory Board also had the Group’s
current corporate venturing activities presented to it and in this context dealt in particular
with the company’s investment in the American company CiDRA Holdings LLC and the
Israeli company Landa Corporation Ltd. In 2019, the Supervisory Board also dealt extensively
with innovation management, ALTANA’s plan to become CO² neutral by 2025, and the
Finance Roadmap for the strategic development of the finance functions in the coming years.
At its June meeting, the Supervisory Board reappointed Mr. Martin Babilas as Chairman
of the Management Board and Labor Director for a period of five years until April 30, 2025,
and resolved to extend his employment contract accordingly. Moreover, the Supervisory
Board resolved to change the compensation system for members of the Management Board.
At its December meeting, the Supervisory Board dealt in detail with the corporate plan-
ning for the next few years as well as the budget for 2020, which it approved. In the constit-
uent Supervisory Board meeting following the Annual General Meeting in March of 2019,
the Chairman of the Supervisory Board was re-elected, and the Annual General Meeting re-
elected him as a member of the Supervisory Board.
16 Report of the Supervisory Board
"},{"text":"Dr. Klaus-Jürgen Schmieder, Chairman of the Supervisory Board of ALTANA AG
Meetings of the Committees
The Human Resources Committee met thrice in the year under review. At the meetings,
it dealt with the reappointment of Mr. Babilas as Chairman of the Management Board and
Labor Director and the corresponding extension of his contract, as well as with issues
relating to Management Board compensation, in particular the change to the compensation
system, which was subsequently resolved by the Supervisory Board. The Audit Committee
met twice during the year under review and reported regularly to the Supervisory Board. In
the presence of the auditor as well as members of the Management Board, the Audit Committee
discussed the annual financial statements of ALTANA AG and the ALTANA Group. In
addition, it dealt with the statutory audit process mandating the auditor, the setting of
audit fees, monitoring the auditor’s independence, and the approval of non-auditing services
of the auditor. Furthermore, the Audit Committee addressed the identification and moni-
toring of risks in the Group, the Group’s internal auditing activities, ALTANA’s Compliance
Management System, as well as the good corporate governance, in particular the amendments
to the German Corporate Governance Code and the German Stock Corporation Act
by implementing the Second Shareholder Rights Directive (ARUG II). The Mediation Committee,
established in accordance with section 27 (3) of the German Codetermination Act, did
not convene in the 2019 fiscal year.
Report of the Supervisory Board 17
"},{"text":"Annual Financial Statements
The annual financial statements of ALTANA AG, the consolidated financial statements for the
year ended December 31, 2019, and the management report of ALTANA AG, as well as
the Group management report, were audited by PricewaterhouseCoopers GmbH Wirtschaftsprüfungsgesellschaft,
which was appointed by the Annual General Meeting and engaged
by the Audit Committee of the Supervisory Board, and it issued an unqualified audit opinion
in each case. The system for early risk recognition set up for the ALTANA Group pursuant
to section 91 of the German Stock Corporation Act was audited, and the examination revealed
that the system is capable of fulfilling its objectives.
The financial statement documentation, the Corporate Report, the reports of PricewaterhouseCoopers
GmbH Wirtschaftsprüfungsgesellschaft on the audit of the annual financial
statements and the consolidated financial statements, as well as the Management Board’s
proposal for the distribution of the profit, were made available to all Supervisory Board
members. The Audit Committee of the Supervisory Board dealt at length with this documentation.
The Supervisory Board inspected the documentation and dealt with it in depth at
its balance sheet meeting in the presence of the auditor, who reported on the main results
of the examination. The Supervisory Board is in agreement with the findings of the audit
without objections and its meeting of March 18, 2020, approved the annual financial statements
and consolidated financial statements prepared by the Management Board. The
annual financial statements are thereby adopted. The Supervisory Board evaluated the Management
Board’s proposal for the distribution of the profit and is in agreement with its
recommendation.
Report in Accordance with Section 312 of the German Stock
Corporation Act
The Management Board prepared a report in accordance with section 312 of the German
Stock Corporation Act on relations with affiliated companies for the 2019 fiscal year.
The Supervisory Board inspected this report and found it to be accurate. The auditor issued
the following audit opinion:
“On completion of our audit and assessment in accordance with professional standards,
we confirm that the factual statements of the report are correct and that the consideration
paid by the company for the legal transactions in the report was not inappropriately high.”
18 Report of the Supervisory Board
"},{"text":"The Supervisory Board approved the auditor’s findings. Following the completion of its own
review, the Supervisory Board has no objections to the Management Board’s statement at the
end of the report.
Personnel Changes
On March 12, 2019, the Ordinary Annual General Meeting of ALTANA AG re-elected
Dr. Klaus-Jürgen Schmieder as a member of the Supervisory Board. His tenure ends following
the Annual General Meeting in 2020. Stefan Weis resigned from his position as the mem-
ber of the Supervisory Board representing trade unions with effect from June 28, 2019. In view
of this, on September 17, 2019, the Duisburg Local Court appointed Stefan Soltmann as
the member of the Supervisory Board representing the unions. On October 1, 2019, the
Supervisory Board elected Mr. Soltmann to its Audit Committee, of which Mr. Weis was
previously also a member. In the Supervisory Board meeting of June 27, 2019, Martin Babilas
was reappointed Chairman of the Management Board and Labor Director of ALTANA AG
for a period of five years until April 30, 2025.
The Supervisory Board would like to express its gratitude to Mr. Weis for the good and
trusting cooperation. The Supervisory Board would also like to thank the members of
the Management Board, the company’s management, and the Group’s employees for their
achievements and commitment during the last fiscal year.
Wesel, March 18, 2020
The Supervisory Board
Dr. Klaus-Jürgen Schmieder
Chairman of the Supervisory Board
Report of the Supervisory Board 19
"},{"text":"Looking to the Future
We at ALTANA have a long-term approach. We invest in the future – sometimes
even contrary to short-term trends. Whether it’s research and development,
digitalization, expansion into emerging markets, or talent promotion, the decisive
factor is what sustainably strengthens ALTANA and thus also our customers,
employees, owner, and society as a whole. We have our sights set on the future.
And that’s where we’re heading with wide-open eyes.
P. 22 P. 26 P. 30
SHAPING FUTURE
MARKETS
INVESTING IN INNOVATIVE
TECHNOLOGIES
STRATEGICALLY EXPANDING
OUR LOCATIONS
One of the ALTANA Group’s great strengths
is its high level of innovation. To this
end, we are continuously developing our
portfolio of products and services in
the field of specialty chemicals. In order to
secure profitable growth in the long
term, ALTANA is also developing new application
fields outside of specialty chemicals
in selected new growth markets. One
of these key future markets is digital
printing.
The ALTANA Group is entering new markets
and opening up new fields of ap-
plication for its products. To this end, we
are making long-term investments in
highly innovative future technologies such
as the new high throughput screening
plant in Wesel. It not only enables us to
carry out series tests with tremendous
speed and efficiency at the highest level of
quality, but also to identify new application
areas for our products.
ALTANA’s BYK division aims to be a longterm
pioneer in rheology additives on
the international market. For this reason,
the additives specialist has not only invested
in production at its site in Gonzales,
Texas, but has also built a new global
research and development center. It is the
ALTANA Group’s competence center for
rheology additives. The products of the
future are created here.
20 Looking to the Future
"},{"text":"P. 34 P. 38 P. 42
PROVIDING
NEIGHBORLY HELP
DRIVING CLIMATE
PROTECTION FORWARD
Promotion of young talent is crucial for
the sustained success of the ALTANA Group
in markets around the world. As a result,
15 years ago ALTANA developed special
human resource development programs
for internal filling of management positions.
The long-term investment in ALTANA’s
talents and personalities has paid off. Today
there is a new generation of man-
agers that is not only successful, but continues
to derive pleasure from making
discoveries.
The ALTANA Group is distinguished by
its employees’ high level of personal commitment.
In St. Louis, Missouri, USA,
ELANTAS PDG staff members have been
supporting numerous social neighborhood
projects on a voluntary basis for over
ten years. The aid projects in the city’s
Baden district range from World Food Day,
where food packages are packed, to
the social projects Back to School Supplies
and Annual Holiday Drive.
STRENGTHENING
PERSONALITIES
By 2025, ALTANA will reduce its CO² impact
from production and energy procurement
worldwide to zero. And already in
2020, the company’s entire power supply
will be converted to renewable energies.
ALTANA will compensate for the unavoidable
use of natural gas and CO² emissions
from necessary business trips, company
cars, and the transport of goods,
by financing equivalent climate protection
projects. We will thus achieve climate
neutrality in our direct sphere of influence.
Looking to the Future 21
"},{"text":"Manfred Knospe,
Head of High Throughput Screening, BYK-Chemie GmbH
"},{"text":"INVESTING IN INNOVATIVE
TECHNOLOGIES
With its digital laboratory, the ALTANA Group is launching a new era in
application technology and thus multiplying the spectrum of its customized
solutions.
"},{"text":"ALTANA is investing around 15 million
euros in the new technology. With the fully
automated system at BYK in Wesel,
220 samples can be produced and tested
in 24 hours in high throughput. The to-
tal number of samples per year is 80,000.
“The decisive factor for success is that
the HTS system will enable us to test products
in the future without any restrictions
on results, thus opening up completely
new application possibilities,”
explains project manager Manfred Knospe.
Specialty Chemicals in XXL
The purpose of the system is to determine
the most suitable products for individual
customer requirements from a
wide range of additives in series tests. “The
system acts like a giant filter. We can
say exactly which of a large number of tested
products are the two or three that
With the fully automated system at BYK in Wesel, 220 samples can be produced and
tested in 24 hours in high throughput.
“ WE ARE ENSURING THAT WE
WILL GROW SUCCESSFULLY
IN THE FUTURE.”
The ALTANA Group is investing in the future with its
highly innovative High Throughput Screening (HTS)
system. Serial tests are carried out with enormous speed
and efficiency at the highest level of quality. Manfred
Knospe is responsible for the implementation of this ambitious
project.
Manfred Knospe is responsible for the implementation
of this ambitious project.
24 Looking to the Future
"},{"text":"Looking to the Future 25
The complex processes are controled and monitored in the cockpit. There are 32 modules with 27 different functionalities for testing additives in
offer the customer the greatest benefit,”
says Manfred Knospe. Whereas tests used
to take months, fully digitalized application
technology means that in the future
they will only take days.
The ultra-modern facility is complex.
It fills a fully air-conditioned room of
over 300 square meters. There are 32 modules
with 27 different functionalities for
testing additives in coatings, plastics, and
adhesives. The modules are connected
by a rail system; shuttles move the samples
from one module to the next. The system,
called FlexShuttle, specially developed
for the requirements of the ALTANA
Group and its customers, is unique. It permits
samples to be prepared and examines
their liquid properties. The samples are
applied by pouring out, drawing down,
or conventional spray application and cured
using UV radiation, or by means of oven
coatings, plastics, and adhesives.
or air drying. The finished dried samples
can then be tested for properties such
as gloss, flow, and color.
Boost for Innovative Strength
The FlexShuttle relieves application technology
of disliked series tests. The time
saved in this way gives the highly qualified
application engineers freedom: Those
who previously had to deal with uniform
series tests can now concentrate on more
demanding, creative laboratory work
and develop new solutions thanks to the
new HTS system. “As a result, we are
giving our innovative strength a big boost,”
says Manfred Knospe enthusiastically.
Conversely, the system can also be
used to test existing products for their
uses in other areas of application without
there being a concrete need for this.
“This opens up completely new possibilities
for us, which would be unthinkable
without the digitalization of series tests,”
says Knospe.
But this is not the only reason why
the HTS system is an investment in
the future. Another is that it is already
designed to meet the capacity and infrastructure
requirements that we expect
in three or four years. And it can easily carry
out tests for other ALTANA divisions,
as well as for external customers. “Our
researchers are working today on tailor-
made solutions of the future for our customers.
This is what makes us ALTANA.
That’s why we are also investing in the appropriate
technology in the long term,”
explains Manfred Knospe. “Seen in that
light, with this investment we are ensur-
ing that we will grow successfully in the
future – completely in the interest of
our customers.”
"},{"text":"Dr. Petra Severit,
Chief Technology Officer (CTO), ALTANA AG
"},{"text":"SHAPING FUTURE
MARKETS
Digital printing is one of the most promising future markets worldwide. In
this area, the ALTANA Group combines its specialty chemicals expertise with
mechanical engineering knowhow.
"},{"text":"“If ten years ago people had said we
were acquiring a stake in a machine manu-
facturer and developing digital printing
solutions together with it, everyone would
have said that this does not suit ALTANA,”
says Dr. Petra Severit, Chief Technology
Officer (CTO) of ALTANA AG. “But now
we’re moving into completely new areas.
And this is what distinguishes ALTANA
as a specialty chemicals company today.”
Dr. Severit identifies relevant future
markets and checks to see whether com-
petitive solutions can be developed.
“Only if there are links with our specialty
chemicals expertise do we embark on
this journey.” This is the case in the rapidly
growing future digital printing market.
In this field, ALTANA develops innovative
system solutions together with
partners.
For the rapidly growing future digital printing market, ALTANA develops innovative
system solutions together with partners.
“D IVERSE AREAS OF EXPERTISE
AS AN INNOVATION DRIVER”
In order to develop the future digital printing market, the
ALTANA Group is focusing on its core competencies.
But optimal solutions can only be created in close cooperation
between mechanical engineering, machine
development, and materials development. Dr. Petra Severit
is driving this development at ALTANA.
Dr. Petra Severit is driving this development at
ALTANA.
28 Looking to the Future
"},{"text":"Highly Innovative System Solutions
The up-and-coming 3D printer manufacturer
dp polar, in which ALTANA has
held a stake since 2017, used ACTEGA’s
knowhow in materials development to
launch a 3D printing solution that offers
customers from a wide range of sectors,
including the automotive, aerospace, and
medical technology industries, complete-
ly new possibilities for manufacturing their
products.
AMpolar® i2 is the world’s first 3D
printing system with a continuously rotating
print platform. In contrast to previ-
ous processes, it is not the print head that
moves, but the area on which printing
takes place. This enables high-precision
components to be produced up to 20
times faster. In addition, components with
different degrees of hardness can be
printed simultaneously, for example orthopedic
prostheses.
In the field of 2D printing, ALTANA has a
share in the Israeli technology company
Landa Digital Printing as part of a strategic
partnership. The nanography technology
developed by Landa opens up possibilities
in digital printing that were
previously either technically impossible to
implement or so expensive that the solution
would not have made it beyond the
niche. BYK delivers high performance
additives – an important prerequisite for
formulating the special printing inks
needed for the technology.
Maximum Added Value for Customers
ALTANA’s internal start-up ACTEGA Metal
Print, in turn, is launching a method for
packaging metallization that requires considerably
less material, costs, and pro-
duction time than the processes commonly
used previously. A separate printer is
not required for this purpose; instead, the
Looking to the Future 29
technology is mounted as an attachment
on existing machines. Both ECKART and
BYK contribute specialist knowledge in the
field of pigment development and sta-
bilization or provide additives for these
developments.
With its digital “Direct to Shape” highspeed
printing, Velox, in which ALTANA
has a stake, also brings disruptive technolo-
gies to the ALTANA Group. “Velox also
requires special inks, the further development
of which is our core competence,”
says Dr. Severit.
Creating system solutions that generate
maximum added value for custom-
ers – how does that work? Dr. Severit has
the answer: “The diversity of our com-
petencies drives innovation along the entire
value chain.”
New technologies are tested in the ALTANA Group’s digital printing competence
center in Lehrte.
ACTEGA experts align inks with the different printing systems.
"},{"text":"Glenn West,
Site Manager Gonzalez (Texas), BYK USA Inc.
"},{"text":"STRATEGICALLY EXPANDING
OUR LOCATIONS
In order to meet future demand for high-quality rheology additives,
BYK has invested around 70 million USD in the Gonzales site.
"},{"text":"“We are investing in the future here,”
says Glenn West, head of BYK’s Gonzales
site in Texas. Rheology additives are produced
there. In most cases, they are special
solutions that meet individual customer
requirements. “For our customers, it
is critical that our products are consist-
ently of high quality. Our rheology additives
are precisely attuned to their
processes and often provide greater efficiency,”
he says. In order to continue
to deliver this added value in the coming
years, BYK has implemented a strategic
investment program of 70 million USD for
the site.
Course for Future Growth
The planning and design work began
about three years ago; construction work
started in the spring of 2018 and is slat-
ed for completion in 2020. The core element
is the expansion of capacity for
BYK is increasing the manufacturing capacities for rheology additives at its U.S. site in
Gonzalez by around 10,000 tons.
“ WE ARE WELL EQUIPPED
FOR THE FUTURE.”
At its Gonzales site, BYK has primarily expanded its
manufacturing capacities. As a result, the com-
pany can ensure its customers a rapid supply of high-
quality rheology additives for the next decade.
Glenn West knows what is important.
Glenn West is coordinating the expansion project.
32 Looking to the Future
"},{"text":"BYK’s Garamite products to be able to
meet the increasing demand, for example
in the paint, coatings, and plastics industries.
The rheology additives help to optimize
the flow behavior of a wide variety
of products.
BYK is increasing its production capacity
by about 10,000 tons. The world
market for Garamite and Organoclay is
growing at about two to three percent
annually. “With our capacity increase we
can cover the market growth expected
for the coming years. So we have set the
course for our future growth,” explains
the site manager.
State-of-the-Art Automation
Technology
Processes have also been optimized to
further strengthen the company’s competitiveness.
BYK is achieving the capac-
ity expansion through the use of cutting-
edge automation technology – and is doing
so with the same number of employees.
A digital process control system is now being
used. This allows the processes as a
whole and at the individual process stages
to be controlled individually.
“We here in Gonzales are very proud
of these innovative technologies. This
means our site is well equipped for the future,”
says Glenn West. The company,
thus, achieves a so far unrivalled degree of
refinement of the minerals used. Sustainability
and safety standards are also
being improved. For example, a new
wastewater treatment plant was installed,
saving energy and costs and improving
the CO² footprint.
Next Generation Products
The new research and development facility
is ALTANA’s new global competence
center for rheology additives. It is where
Looking to the Future 33
future customer challenges are already
solved today and next generation products
are developed. In this way, BYK in
Gonzales has created the basis for opening
up new customer groups and fields of
application with new innovative solutions.
Says Glenn West: “The decisive fac-
tor is that we have more than 30 years of
knowhow and experience in the field
of rheology additives with our some 170
colleagues here. This is the best longterm
investment we have to offer our customers.”
BYK is optimizing processes and investing in state-of-the-art automation
technologies.
The company thus achieves an unprecedented degree of refinement of the
minerals used.
"},{"text":"Martin Babilas,
CEO, ALTANA AG
"},{"text":"DRIVING CLIMATE
PROTECTION FORWARD
The ALTANA Group will achieve climate-neutrality in its direct sphere of
influence by 2025, thus consistently pursuing its sustainability course.
"},{"text":"36 Looking to the Future
ALTANA paved the way to CO² neutrality in 2019. For Martin Babilas, taking responsibility for climate
“With our CO² neutrality program up
to 2025, we are fulfilling our responsibility
for climate protection and consistently
pursuing our sustainability course,” says
Martin Babilas, CEO of ALTANA AG. The
goal is to achieve climate neutrality, and to
do so already from 2025 onwards, by
which time the company will have reduced
its CO² impact from production and en-
ergy procurement to zero worldwide. And
already starting in 2020, the company’s
entire power supply will be converted to
renewable energies. ALTANA will compensate
for the unavoidable use of natural
gas, as well as CO² emissions arising
from necessary business trips, company
cars, and the transport of goods, by financing
equivalent climate protection projects.
As a result, the specialty chemicals
group will achieve climate neutrality in its
direct sphere of influence by 2025.
Anyone committed to sustainability must create facts.
ALTANA has achieved considerable CO² savings faster
than planned and has now set itself an ambitious new
target. In the eyes of Martin Babilas, responsibility
for climate protection is a matter for top management.
protection is a matter for top management.
“FOOTPRINT ON
INNOVATION,
NOT ON EMISSIONS”
"},{"text":"Focus on Energy Efficiency and
Renewable Energies
ALTANA is not starting from scratch. In
2017, it had already achieved the goal it
set itself in 2007 of reducing CO² emissions
by 30 percent in relation to gross value
added by 2020. In order to further
reduce its CO² emissions, Babilas is relying
on greater energy efficiency and the
long-term replacement of natural gas as a
source of energy with renewable energies
at its worldwide sites. In addition to
the existing solar systems at ELANTAS in
Ascoli Piceno, Italy, and at BYK in Deventer,
the Netherlands, a further photovoltaic
system went into operation at ELANTAS in
Pune, India, which covers the electricity
requirements of the new research center at
this site. In Collecchio, Italy, ELANTAS is
currently constructing another photovoltaic
system for a new production and labo-
ratory building.
Climate Protection Is a Corporate Task
Aside from the measures at its own sites,
ALTANA is also implementing a program
in close cooperation with its suppliers to
consistently further improve the CO² balance
of purchased raw materials, too. For
Babilas, taking responsibility for climate
protection and creating the corresponding
facts is a corporate task. “Policymak-
ers must create the indispensable framework
for this, and, above all, promote
renewable energies much more strongly
and swiftly,” says ALTANA’s CEO.
Decades of experience in developing
innovative product solutions that con-
tribute to sustainability will benefit the
company in achieving its climate protection
goals. Here are just a few of many
examples: Wire enamels from ALTANA’s
ELANTAS division are increasingly being
used in electric vehicles and extend their
service life. BYK offers a solution for the
Looking to the Future 37
recycling of polypropylene from car bat-
teries, which was previously not recyclable.
An aluminum pigment in wall paints
developed by the ECKART division ensures
that up to 50 percent of the heat is radi-
ated back from the walls into the room.
A PVC-free seal from the ACTEGA division
helps beverage bottlers save 10,000
tons of steel for their crown caps. This
roughly corresponds to the weight of the
Eiffel Tower in Paris. Martin Babilas con-
cludes: “We want to leave our footprint on
innovations, not on emissions.”
ALTANA operates photovoltaic systems at different sites (here in Ascoli Piceno,
Italy).
Decades of experience with sustainable product solutions are helping the company
achieve its climate protection targets.
"},{"text":"Dr. Julia Hufen,
Global Business Line Manager Electronic, ELANTAS GmbH
"},{"text":"STRENGTHENING
PERSONALITIES
The long-term investment in talent at ALTANA has paid off. There is already a
new generation of managers that is not only successful, but also derives joy from
making discoveries.
"},{"text":"ALTANA, BYK, and ELANTAS – Dr. Julia
Hufen has already successfully solved numerous
tasks. After working at various
sites in Germany and the U.S., she will soon
be active worldwide with a focus on
Asia. “I’m particularly looking forward to
this challenge, especially since Asian culture
is completely different,” says Dr. Hufen
enthusiastically.
Openness to new ideas and tolerance
are essential for the 41-year-old chem-
ist, who holds a doctorate. “I am driven
by curiosity. I love understanding things
down to the last detail. This challenges and
motivates me.” For her, chemistry is a
basis for understanding things and explaining
the world.
Working Across the Globe
Dr. Hufen is not only curious but also good
at structuring facts. In addition, she is
able to get colleagues and customers in-
The globally oriented Management Development Program was developed for employees who have a
high degree of international mobility and the potential to take on strategic positions.
“ I AM DRIVEN BY
CURIOSITY.”
The new generation of ALTANA managers is
being deployed globally even more frequently
than before. They bring with them top man-
agement skills that they develop in ALTANA man-
agement programs. Dr. Julia Hufen belongs to
this new generation.
Dr. Julia Hufen has already successfully solved
numerous tasks.
40 Looking to the Future
"},{"text":"volved in her ideas, wishes, knowledge, and
skills as they tackle tasks. Mutual appre-
ciation is important to her. Openness and
tolerance are helpful.
For her, challenges are not “insuperable
mountains.” Her credo: “Challenges
are there to be met.” This also applies to
work at sites around the globe. “It has
always been my dream to work abroad,”
she says. And she began working at an
early stage to make her dream come true.
Right after she finished her studies
she worked for a U.S. company, ending up
as head of research and development.
She had previously studied chemistry at the
University of Duisburg-Essen and economics
at the distance learning university
in Hagen. During her studies, she real-
ized that she prefers to work in an application
oriented way. “Research on mol-
ecules is certainly appealing, but I prefer to
use the knowledge I gain to develop applicable
solutions.”
Support Through Management
Programs
She started her career in the ALTANA
Corporate Development department and
M&A. Then she returned to operations,
switching to BYK’s Industrial Applications
department, before moving to the U.S.
as Head of Global End Use Metalworking
Fluids for BYK. Back in Wesel, she was
Project Manager for Waxes, and since Au-
gust 2019 she has been Global Busi-
ness Line Manager Electronic at ELANTAS.
In 2018-2019, she completed the
ALTANA Group’s Management Development
Program (MDP). The globally oriented
program was developed for employees
who are willing to change, have a
high degree of international mobility, and
the potential to take on strategic positions.
Looking to the Future 41
Dr. Hufen especially appreciates the
personal coaching. The program is very
intensive, she says, and perfectly adapted
to future tasks.
Above all, she revels in having the
opportunity to establish global networks.
She will be able to make good use of
her network when she successfully manages
ELANTAS’ next challenge in Asia –
including the joy of discovery.
Dr. Julia Hufen has been Global Business Line Manager Electronic at ELANTAS since
August 2019.
Openness to new ideas and tolerance are essential for Dr. Hufen, who has a PhD in
chemistry.
"},{"text":"Francine Jamison,
Executive Administrative Assistant, ELANTAS PDG Inc.
"},{"text":"PROVIDING
NEIGHBORLY HELP
At ELANTAS PDG in St. Louis, neighborhood involvement has a long tradition.
The workforce has supported numerous social projects for years.
"},{"text":"“It is part of our corporate culture to help
people in need quickly and uncomplicat-
edly. And we do this not just as a one-time
campaign, but over many years, if nec-
essary,” says Francine Jamison, Executive
Administrative Assistant at ELANTAS
PDG. The employees prove this time and
time again. When a colleague lost every-
thing in a fire, for example, they helped
him quickly and straightforwardly.
Employees of the insulation mate-
rials specialist for the electrical and electronics
industry provide energetic support
to people in the neighborhood who
need a helping hand – and have been
doing so for more than 13 years with some
projects.
About half of all the employees at the
St. Louis site are involved in various projects.
“And on a volunteer basis,” Francine
Jamison points out. Among the most
important projects are the social initiatives
The employees of ELANTAS PDG in St. Louis support people from the neighborhood
and have done so in some projects for more than 13 years.
“ SPARKLING CHILDREN’S EYES
ARE OUR MOTIVATION.”
Personal commitment truly matters at ALTANA. And
it doesn’t end at the factory gate. Employees at
ELANTAS PDG in St. Louis, USA, have been supporting
people in their neighborhood on a voluntary
basis for years. Francine Jamison is one of these staff
members.
Francine Jamison coordinates the Back to School
Supplies project, among other things.
44 Looking to the Future
"},{"text":"Back to School Supplies and Annual Holiday
Drive.
Many Neighborhood Projects,
Carefully Selected
At the Annual Holiday Drive every year in
November and December, employees
donate gifts and money for neighborhood
families. Residents of the Baden district
where ELANTAS PDG is located often have
very low incomes, and some have no
income at all. The ELANTAS PDG employees
helped five families in St. Louis in
2019, making it possible for them to receive
gifts such as shoes, toys, clothing,
and sometimes even a basket of food under
their Christmas tree. For more than
25 years, ELANTAS employees have helped
put a smile on the faces of families at
Christmas – sometimes very practically, dis-
guised as Santa Claus.
With the second major initiative, Back to
School Supplies, needy children from the
neighborhood have been receiving support
for more than ten years. Money collected
by the employees is used to buy
school supplies such as exercise books and
pens and to provide about 25 schoolchil-
dren with these items every year as a basis
for their education. “It’s wonderful to
see the children’s sparkling eyes when they
receive the school supplies. That’s our
motivation,“ says Francine Jamison, who
coordinates this aid project at ELANTAS
PDG.
Given the many requests for support,
Francine Jamison and her colleagues
are the first to gather information about
the proposed projects. Then, based on
their research, the management decides
in the fall which initiatives will be supported
in the following year in keeping
with the motto “helping people to help
Looking to the Future 45
themselves.” The Back to School Supplies
and Annual Holiday Drive projects are
always included. And will be again in
2020.
The numerous awards ELANTAS
PDG has received as a top employer show
that the climate of support reflects back
on the company. Since 2013, the company
has been on the St. Louis Post Dispatch
newspaper’s Top Workplaces list five times.
In this respect, too, the employees have
been demonstrating exceptionally high
personal commitment for years: The
evaluation is based exclusively on an employee
survey. More than 80 percent of
the workforce is regularly involved in this
process.
For more than 25 years, ELANTAS employees have been helping to put smiles on
families’ faces.
With the money collected, school supplies like exercise books and pens are bought
and provided to around 25 schoolchildren each year.
"},{"text":"Group Management Report
In 2019, ALTANA mastered a challenging market environment
future. The weakening of demand in important industrial
sectors, in particular the automotive industry, which
already began in mid-2018, and the overall economic
downturn, particularly in China, had a significant
impact on the entire business year. The slightly lower
material cost quota and a stringent cost management
had a positive effect, but were unable to fully compensate
less, the EBITDA margin remained within the long-term
target corridor of 18 to 20 percent, despite consider-
able expenses for research and development and digitalization.
future profitable growth through acquisitions.
47
53
66
70
71
and at the same time invested heavily in the
for the sales-related decline in earnings. Neverthe-
In addition, we set the course for ALTANA’s
Group Basics
Business Development
Innovation and Employees
Subsequent Events
Expected Developments
"},{"text":"Group Management Report Products Safety and Health Environment Human Resources Social Commitment Consolidated Financial Statements 47
Group Basics
Organization and Legal Structure
The ALTANA Group is a global supplier of specialized chemical
products and related services for different branches of
industry and application fields. In the 2019 fiscal year, the
Group’s 64 consolidated subsidiaries and associated companies
achieved sales of more than € 2.2 billion. The ALTANA
Group employs about 6,500 people.
ALTANA’s activities are grouped into four divisions, each
of which has its own management and organizational
structure. The divisions and the Group companies assigned to
them are decentralized and empowered to largely make
market-, location-, and product-related decisions themselves.
The divisions are active worldwide and have their own
production sites and sales offices as well as research and development
laboratories in the regional markets that are
important for them.
ALTANA AG, headquartered in Wesel, is a stock corporation
in accordance with German law. As the ALTANA
Group’s managing company, it assumes strategic control of
the Group and the divisions. ALTANA AG is led by the Management
Board, whose members act on their own responsibility
and are solely committed to the interests of the company.
The Management Board’s activities are monitored by
the Supervisory Board, whose members also advise the
Management Board. More information on ALTANA AG’s management
and control system is provided in the Corporate
Governance section of this report.
All of the shares in ALTANA AG are held by SKion GmbH,
Bad Homburg v. d. H., Germany, an investment company
owned by Susanne Klatten.
The decentralized organizational structure combines the
individual operating units’ ability to act swiftly and cater
to the needs of markets and customers with the advantages
of a financially strong and internationally active group. The
organization is designed to adapt flexibly to changed market
conditions and a volatile economic environment. In addition,
new activities can be integrated into the organization
in a short time.
Business Activity and Divisions
As a globally active specialty chemicals group, ALTANA
focuses its core activities on sophisticated markets and customers
who need individual solutions.
A significant share of the ALTANA Group’s product and
service portfolio encompasses input materials for the production
of coatings, printing inks, and plastics. In addition,
ALTANA manufactures printing inks and coatings for spe-
cial applications, insulating resins for the electrical and electronics
industries, sealants for packaging, and measuring
and testing instruments.
Activities of the Divisions
BYK
The BYK division is one of the leading international suppliers
of special-purpose ingredients, so-called additives, used
in coatings and paints, plastics, exploration, and other industrial
applications. The division’s products, most of which
are used in only very small amounts, have a decisive influence
on the properties of their customers’ end products or en-
able customers to improve their manufacturing and industrial
processes.
Wetting and dispersing additives, one of the division’s
main product groups, help improve the distribution of
pigments and filling materials, and enable them to function
better, for example in coatings and plastics. With the help
of defoamers and air-release additives, foaming is prevented
during the manufacture of coatings and paints as well as
in end customers’ applications. Surface additives are used to
"},{"text":"produce special properties such as shiny, matte or espe-
cially smooth surfaces. Rheology additives improve, for example,
the flow behavior of coatings and plastics. The divi-
sion also manufactures measuring and testing instruments
that are used to determine surface properties, color shades,
and optical effects.
BYK-Chemie GmbH, based in Wesel, is the management
company of the division. In addition, it is the division’s
biggest production and development site for additives and
the ALTANA Group company with the highest sales. BYK also
produces at other sites in Germany, the Netherlands, Great
Britain, as well as in China and the U.S. All of the measuring
and testing instruments are manufactured at a site in
southern Germany (Geretsried).
The division sells its products under the brands BYK
(additives) and BYK-Gardner (instruments), primarily to customers
in the coatings, printing inks, and plastics industries.
Due to its comprehensive portfolio, BYK is a system supplier
and partner of coatings manufacturers and plastics proces-
sors in particular. On the basis of its great problem-solving
expertise, BYK has also attained an important market position
in many other industrial application fields in recent years.
The division markets its products in the important
regions via its own companies and branches. In addition, a
dense network of dealers and agents markets its products
worldwide. BYK generates the highest share of its sales in
Europe, followed by Asia and the Americas. In terms of
countries, the U.S. makes the largest contribution to sales,
followed by China and Germany.
BYK continually expands and supplements its product
portfolio. To gear its innovation activities closely to the
needs of the markets, the division has its own network of
Business divisions and product portfolio
Paint additives Coatings Wire enamels Closures
Plastics additives Graphic arts Electrical Flexible packaging
Industrial applications Cosmetics and personal care Electronic Labels
Exploration Plastics industry Engineering materials Paper-based packaging
Measuring and testing instruments Functional applications Publication and commercial
Rigid packaging
Specialty consumer goods
48 Group Basics
"},{"text":"Group Management Report Products Safety and Health Environment Human Resources Social Commitment Consolidated Financial Statements 49
development laboratories, which cooperate closely with
customers in the respective regions. At the same time, new
fields of application are continually tapped for existing or
new products.
ECKART
ALTANA concentrates the development, production, and sale
of effect pigments in the ECKART division. Customers use
these products to achieve visual and functional effects, primarily
in coatings, plastics, printing inks, cosmetics, and
construction materials. The principal raw materials are aluminum,
copper, and zinc. Aside from metallic effect pigments,
other pigments are offered based on artificial substrates. The
division’s portfolio is supplemented by effect printing inks
and services.
Aluminum-based effect pigments comprise the largest
part of ECKART’s business. Customers use them particularly
to achieve silver metallic effects, for example, for car paints
or on graphic arts products. Aluminum pigments are also
used for functional purposes, for example, in the manufacture
of aerated concrete. Bronze effect pigments generate
golden effects in paints, printing inks, and plastic products.
Customers use zinc pigments in special paints to achieve
functional properties, particularly for corrosion protection.
ECKART GmbH is the division’s operating management
company. It produces a large part of the effect pig-
ments it sells worldwide in southern Germany (Hartenstein
and Wackersdorf). Other manufacturing sites are located in
Switzerland and Finland, as well as in China and the U.S.
The manufacturing process is characterized by a very
high degree of value creation. In a number of successive
steps, all kinds of pigments are made, refined chemically, and
in some cases processed into press-ready printing inks.
The effect pigments are marketed predominantly via
the division’s own sales structures, but also by sales partners.
ECKART’s most important customers include international
manufacturers of coatings, printing inks, and
plastics.
Other important customers are manufacturers in the
construction industry and the cosmetics sector. ECKART
achieves nearly half of its sales in Europe. Its next largest
sales regions are Asia and the Americas.
As an important manufacturer of metal effect pigments,
ECKART continually pushes forward the development of
new product qualities and opens up new fields of application
on the basis of sophisticated technological expertise and
many years of knowhow.
ELANTAS
The companies in the ELANTAS division offer their customers
a high level of expertise in the field of electrical insulation
materials. As one of the world’s leading suppliers of such
products, the division’s portfolio concentrates on coatings
for insulating magnet wires as well as special resins and coatings
for impregnating and protecting electrical and electronic
components.
ELANTAS has its own holding structure under the management
of ELANTAS GmbH, based in Wesel. The latter
controls the division’s activities and supports its operating
subsidiaries, which develop and produce insulating materials
in Germany, Italy, China, India, Malaysia, the U.S., and
Brazil.
The division’s products are marketed worldwide. Among
its most important customer groups are magnet wire manufacturers,
which need materials to insulate wires made of
copper or aluminum. The division also supplies insulating
resins and coatings directly to manufacturers of electrical and
electronic components.
ELANTAS’ most important sales region by far is Asia,
and particularly China. A high proportion of global manufacture
of electrical and electronic components and consumer
goods is concentrated in this region. The division has had its
"},{"text":"own production sites in China, India, and Malaysia for
years. After China, its most important sales markets are the
U.S., India, and Italy.
On the basis of comprehensive expertise in the manufacture
and application of liquid insulating systems, the
division is steadily expanding its activities. It seeks to tap new
application fields and thus growth potential by developing
new insulating materials and applying specific polymerization
knowhow. The global trend towards electromobility
should ensure additional growth in this area.
ACTEGA
The ACTEGA division’s portfolio is tailored to the needs of
the packaging and graphic arts industries. It produces
specialty coatings, printing inks, adhesives, and sealants used
by customers to achieve functional and visual effects.
ACTEGA is managed by the holding company ACTEGA
GmbH, based in Wesel. Subsidiaries in Germany, France,
Spain, China, the U.S., Brazil, Canada, and Chile manufacture
and sell the division’s products. Its research and development
activities are also decentralized, oriented to the competencies
of the individual companies in the relevant appli-
cation areas.
Important product groups of the division include waterbased
coatings and printing inks, as well as sealants and
adhesives used to make packaging materials. A focal point
of its product portfolio is the specific needs of the food
industry with its high quality requirements. In addition, there
is a demand for ACTEGA’s printing inks and overprint
varnishes among customers in the graphic arts industry. The
division’s largest sales region is Europe, followed by the
Americas. Its most important individual markets are Germany
and the U.S.
Together with the packaging industry, and in direct contact
with brand manufacturers, ACTEGA develops new
and improved optic and haptic functionalities. Its innovation
activities primarily aim to improve the safety and shelf life
of packaged foods.
In recent years, the division has invested in a targeted
way in the acquisition and further development of new
technologies in order to tap new growth potential in the medium
to long term for its existing business and to prepare
its entry into new markets.
Important Influences on Business Development
ALTANA’s different sales markets are influenced by various
short-, medium-, and long-term trends.
Short- and medium-term fluctuations in demand result
mainly from economic developments. The current devel-
opment of consumer behavior is not the only factor. Our customers’
expectations regarding the short-term development
of the end markets downstream in the value chain also
have a significant impact on their purchase behavior. This
appraisal largely determines how much storage is reserved
along the value chain.
In addition, actual and expected changes in the prices of
essential raw materials impact the sales situation. When
raw-materials prices continually rise, customers look for alternative
input materials and this influences overall sales or
the product mix. The same applies to significant changes in
other cost components that have a strong influence on
the price of products. This price sensitivity of the markets is
also reflected in short-term changes in demand, when for
example stronger price fluctuations are expected for significant
raw-materials markets.
The competitive situation in the different product-
specific market segments can have similar effects on customer
behavior. The entry of new manufacturers into a market
or the withdrawal of existing manufacturers from a market
and the competitors’ prices can impact demand.
Long-term changes in demand for the Group’s products
and services are brought about on the one hand by global
50 Group Basics
"},{"text":"Group Management Report Products Safety and Health Environment Human Resources Social Commitment Consolidated Financial Statements 51
megatrends and the economic growth of certain regions. On
the other hand, product and technological developments
continually open up new sales potential or lead to product
segments being discontinued.
In the course of a year, seasonal fluctuations in demand
result from lower customer activity, especially during the
Chinese New Year Festival, during the summer months, and
at the end of the year.
Strategy and Control System
Strategy
Current market requirements, and market demands expected
for the future, determine the ALTANA Group’s corporate
action. The success of our customers is at the center of our
business activities. We can only be successful in the competitive
environment in the long run if we offer our customers
added value.
Our top financial priority is to sustainably increase
the company’s value. To achieve this aim, we consistently gear
ALTANA to profitable growth in future-oriented specialty
chemicals markets.
At ALTANA, profitable growth is based on several pillars.
The primary ones are to expand our operating activities
in existing markets and to open up new adjacent sales segments.
ALTANA’s four divisions occupy significant competi-
tive positions in their respective sales markets. This positioning
is an important prerequisite for our being identified
and acknowledged by market participants as a competent
supplier of customized solutions. In addition to ALTANA’s
comprehensive product portfolio, innovation plays a key role
in its high level of problem-solving expertise.
To enable customers to create new applications and
strengthen their portfolio, ALTANA continually pushes forward
its own research and development activities. To this
end, our employees’ knowhow and experience are just as
important as investments in new technologies.
To continually expand our specialized portfolio, we
regularly supplement our operating growth by acquiring new
companies or business activities. As a result, for example,
new value creation steps are integrated into the Group or
access to new markets and technologies is granted.
In recent decades, the ALTANA Group has increasingly
geared its activities to international markets. As a consequence,
the Group has been able to benefit from the strong
growth rates of emerging countries and to accompany
many customers as they build production structures in these
regions. Furthermore, ALTANA’s global orientation enables
it to recognize local demand trends quickly and to examine
whether the applications developed subsequently have
sales potential in other regions, too.
Control System and Goals
ALTANA’s control system is fundamentally oriented to the goal
of a sustainable increase in the company’s value. A number
of ratios, mainly financial, are derived whose developments
are analyzed and for which target values are determined.
The most important key performance indicators are ALTANA
Value Added (AVA), sales growth, earnings before interest,
taxes, depreciation and amortization (EBITDA), as well as the
EBITDA margin, earnings before interest and taxes (EBIT),
and capital expenditure.
A change in the company’s value in a given period is calculated
by using the financial ratio ALTANA Value Added.
The absolute AVA is calculated by subtracting the cost of capital
employed in the Group from the operating earnings.
The relative AVA constitutes this difference in proportion to
the capital employed. It is calculated by subtracting the
cost of capital from the return on capital employed (ROCE).
The calculation of the operating earnings starts with
earnings before interest and taxes, which are adjusted for
"},{"text":"acquisition-related and one-time special effects and from
which a calculated tax burden is deducted.
The capital employed, in turn, encompasses those components
of the assets and liabilities needed to achieve
operating earnings. The cost of capital is determined from
the weighted average of cost of debt and cost of equity.
We regularly examine the weighted average cost of capital
but only adjust it for the calculation of the AVA if it exceeds
or falls below a certain range. In the last few years, we set
our weighted average cost of capital at 8 %. As a result of
our examinations, we will adjust the weighted average cost
of capital for 2020 and calculate with a weighted average
cost of capital of 7.5 %.
Key performance indicators are used for measuring the
company’s success and as criteria for strategic and operational
decisions at the level of the Group holding company,
the divisions, and individual companies. In addition, the
key figure AVA is also used to determine variable compensation
components.
Our goal is to achieve a sustainable positive AVA, that
is, to achieve operating earnings that exceed the cost of
capital. In each of the last few years, we have managed to
generate a positive AVA.
Sustainable profitable sales growth forms the basis for
a long-term increase in our operating earnings and thus in
the value of the company. ALTANA’s goal is to outperform the
general market growth in the most important sales segments
and thus to obtain market shares.
In the long term, we aim to achieve average annual
operating sales growth of 5 %. We seek to generate additional
growth through acquisitions, either by acquiring supplementary
activities at the level of our existing divisions or
through the possible integration of new business activities.
But growth should not be achieved at the expense of
profitability. Therefore, control of the EBITDA margin is
very important for the ALTANA Group. The long-term target
range for the EBITDA margin of the Group is 18 % to 20 %.
Derived from this are long-term target margins for our four
divisions, which may deviate from the average target val-
ue for the Group due to the different business activities and
market characteristics. In the last few years, the Group
margins achieved were within or, in some years, even above
the target range.
In addition to achieving long-term sales and earnings
momentum, another focus to successfully increase the value
of the company is control of the operating capital. The
main factors of influence in this context are the development
of fixed assets and of net working capital.
On average over several years, our investments in property,
plant and equipment and intangible assets have been
approximately 6 % of our sales. Due to this continuity, sharp
increases in operating capital and resulting short-term fluc-
tuations of the AVA can be minimized. In addition, every important
investment is examined regarding its short- and
long-term effects on the company’s value.
For the control of net working capital, which is of great
importance for the development of operating capital, we
use key performance indicators to analyze and control profitable
growth and the company’s value. These key performance
indicators concern the scope of inventories as well as
trade accounts receivable and payable.
Apart from the aforementioned essential financial
control parameters, there are other financial key indicators
that help us analyze and control profitable growth and
the company’s value. The most important ones are cost figures
(cost of materials, personnel expenses, etc.).
To guarantee that all activities are geared uniformly
to the Group’s strategy, we also use non-financial key performance
indicators. These indicators, however, are not
directly relevant for control and focus on a qualitative evaluation
of activities whose financial measurability is limited.
They include data for evaluating innovation and sustainability,
analyzing sales markets, and gauging customer satisfaction.
52 Group Basics I Business Development
"},{"text":"Group Management Report Products Safety and Health Environment Human Resources Social Commitment Consolidated Financial Statements 53
Integrated Planning Processes
All of the key performance indicators relevant for control are
compiled and analyzed within the framework of standardized
reporting processes. To be able to use these key parameters
effectively to control our strategy and possible short-
and medium-term measures, there is an integrated planning
process embracing different planning levels and dimensions.
The planning cycle has a strategic planning component,
which combines the analysis of the essential performance
indicators for future business development at the product
group level with a detailed representation of the changes
expected in the market environment.
From this, strategic measures are derived enabling us
to react to expected developments at an early stage. These
measures, developed in the strategic planning process,
include not only fields of activity on current sales markets,
but also concrete goals and planning steps for entry into
new fields of business or application areas and changes in
the portfolio of business activities.
The decisions taken within the framework of strategic
planning enter into our subsequent medium-term financial
planning. The latter delineates our growth and profitabil-
ity goals for the coming three years and the effects of the
expected business development on ALTANA’s asset and
financing structure. This is used to derive possible measures
for our financing strategy. Our medium-term financial
planning is supplemented by scenario analyses, which transparently
reflect the sensitivities of the key performance
indicators to relevant, predominantly cyclical changes in the
market environment. From this, we derive levels of reaction
for possible countermeasures.
Business Development
General Business Setting
Overall Economic Situation
The momentum of global economic development continued
to slow down in the course of 2019. The International
Monetary Fund (IMF) currently estimates that the world economy
grew by 2.9 %, down on the previous year (3.6 %).
The escalating trade conflict between the USA and China in
2019, the decline in demand in Asia, particularly in China,
compared with previous years, and the uncertainties surrounding
the United Kingdom’s withdrawal from the European
Union exacerbated the already existing economic downturn.
This trend is reflected in almost all regions, but especially
in the established industrial nations. Only in Japan did the
economy develop better than in the previous year.
At an expected 1.2 %, the Eurozone posted lower growth
than in the previous year 2018 (1.9 %). All of the major
economies in Europe exhibited a nearly parallel economic development
characterized by flagging momentum. Accord-
ing to the International Monetary Fund (IMF), Germany’s economic
growth was particularly subdued. At 0.5 %, it was
significantly lower than in the previous year (1.5 %). In the
two preceding years, the growth dynamics were more pronounced.
Growth in 2019 was mainly supported by consumption.
Private and public consumer spending grew more
strongly than in the two previous years.
According to current IMF estimates, the economic momentum
in the Americas in 2019 was also at a lower level
than in 2018, with the USA reporting a decrease in economic
growth from 2.9 % in the previous year to 2.3 % in 2019.
The economic performance in Canada was also weaker, with
an increase of 1.5 % (previous year: 1.9 %). Economic
growth in the major Latin American economies remained at
the same low level. At 1.2 %, the Brazilian economy in
particular did not achieve higher growth than in the previous
year (+ 1.3 %). Mexico, on the other hand, stagnated in
2019 (0 %), after posting growth of 2.1% in the previous year.
"},{"text":"The chemical sector in the Asia-Pacific region was again the
biggest driver of global growth in the past fiscal year. The
ACC estimates that production grew by 3.1 % in this region,
after standing still in the previous year (0.1 %). The high
momentum is mainly due to the development of chemical
manufacture in China, which is expected to grow by 4.9 %
in 2019, while growth in Korea and Japan was significantly
lower than in the previous year.
In the first few months of 2019, the price of a barrel of
Brent crude initially rose continuously from just under 55
U.S. dollars to 75 U.S. dollars. From June onwards, the price
initially weakened noticeably and, due to fears of a further
intensification of trade conflicts and the sluggish industrial
economy, fell back to the level of the beginning of the year.
Oil prices then rose sharply again in the course of December,
closing the year at 67 U.S. dollars. One of the reasons for
the increase was the announced breakthrough in the negotiations
to defuse the trade dispute between the USA and
China, which had previously repeatedly depressed oil prices.
On an annual average, the price level in 2019 was thus
below that of the previous year.
Important Events for Business Development
In 2019, non-operating effects influenced ALTANA’s earnings
and financial position as well as its assets.
In July 2019, ALTANA acquired the testing instruments
and other laboratory equipment business of the American
Paul N. Gardner Company, Inc. in an asset deal. The activities
were integrated into the BYK division and had a slightly
positive impact on the sales development. By contrast, the
activities acquired at the end of 2019 in the wire enamel
business of the Hubergroup India Private Ltd. did not yet make
a sales or earnings contribution to the ELANTAS division in
the past fiscal year.
The development of exchange rates between the euro,
the Group currency, and other currencies important for
ALTANA had a positive influence on sales development in
54 Business Development
Growth in Asia also slowed down in 2019, but was still at a
high level compared to the other regions. With an expansion
of 6.1 %, China did not reach the growth rate of 6.6 %
of the previous year. The growth rate in India fell more significantly,
from 6.8 % in the previous year to 4.8 % in 2019.
The largest economies of Southeast Asia (ASEAN-5), which
grew by 4.7 %, were also unable to match the growth of
the previous year (5.2 %). In Japan, on the other hand,
the increase in economic output accelerated from 0.3 %
to 1.0 %.
Industry-Specific Framework Conditions
According to estimates by the American Chemistry Council
(ACC), global chemical manufacture increased by 1.2 %
in the past fiscal year, achieving slightly higher growth than
in 2018 (1.0 %). As a result, the growth momentum in
chemical production should increase, contrary to the trend in
global economic output.
However, the regional changes in chemical production
do not reflect the regional development of general eco-
nomic performance in all countries. According to the German
Chemical Industry Association (VCI), Europe’s largest
chemical producer, Germany, again recorded a significant decline
in production volume (excluding the pharmaceutical
industry) of 2.5 % in 2019. On the other hand, the ACC estimates
that other European countries that are important
for the chemical industry recorded positive developments
in chemical production, including the United Kingdom
(+ 1.1 %), France (+ 0.9 %), and Italy (+ 0.6 %). In the entire
European region, chemical production was down 0.4 %
in a year-to-year comparison.
In the U.S., the increase in chemical production fell
significantly to 0.6 % (previous year: 3.8 %), particularly due
to the trade disputes between China and the USA. In
Latin America, chemical production growth also decreased
compared with the previous year, albeit at a significantly
lower level.
"},{"text":"Group Management Report Products Safety and Health Environment Human Resources Social Commitment Consolidated Financial Statements 55
2019 and a slightly negative influence on earnings devel-
opment. The average exchange rate of the euro to the U.S.
dollar was 1.12 U.S. dollars for one euro, down on the
previous year (1.18 U.S. dollars for one euro). Effects from
changed exchange-rate relations also resulted from a further
decline in the average exchange rate of the euro against
the Chinese renminbi, from 7.81 renminbi to 7.74 ren-
minbi for one euro. Other currencies important for key business
figures also changed in relation to the Group currency,
the euro, on average over the year. The effects of the translation
of the financial statements of major non-euro Group
companies on items of the 2019 income statement were positive
overall. Differences in exchange rates on the balance
sheet date also had a positive influence on balance sheet
items compared to the previous year.
Business Performance
Group Sales Performance
Group sales reached a total of € 2,248.9 million in 2019,
a 3 % or € 58.5 million decrease compared to the previous
year (€ 2,307.4 million). Non-operating effects generally
had a positive effect on the sales development. Exchange-rate
changes, primarily from the changed relations of the euro
to the U.S. dollar, resulted in a sales increase of 1 %. Due to
the acquisition of the business of Paul N. Gardner in the
U.S. (BYK division) in mid-2019, Group sales increased by
€ 4.1 million. Adjusted for these currency and acquisition
effects, Group sales were 4 % below the previous year.
This means that we did not achieve the operating sales
growth in a range between 1 % and 5 % forecast at
the beginning of the year for 2019. The main reasons for the
shortfall were sluggish demand from key industrial sec-
tors, especially the automotive industry, and the general economic
slowdown, especially in China. The decline is al-
most exclusively due to a demand-driven reduction in sales
Key figures
2018 2019 Δ % Δ % op.¹
in € million
Sales 2,307.4 2,248.9 - 3 - 4
Earnings before interest,
taxes, depreciation and
amortization (EBITDA) 430.6 415.8 - 3 - 3
EBITDA margin 18.7 % 18.5 %
Operating income (EBIT) 295.8 262.5 - 11 - 10
EBIT margin 12.8 % 11.7 %
Earnings before taxes
(EBT) 264.1 231.3 - 12 - 10
EBT margin 11.4 % 10.3 %
Net income (EAT) 187.0 169.0 - 10
EAT margin 8.1 % 7.5 %
¹ Operating deviation, i. e. adjusted for acquisition and divestment as well as exchange-rate
effects. This adjustment also applies to other sections of this management report.
volumes, which affected all business units, albeit to varying
degrees.
The regional sales and sales structure shifted only slightly
compared to the previous year. With an unchanged share
of 38 % of total Group sales, Europe continues to represent
the most important sales region for ALTANA. Both nominal
and operating sales in Europe were 2 % below the previous
year’s level. Sales decreased in most of the region’s impor-
tant sales markets for ALTANA. In the company’s home market
of Germany, in particular, sales were unable to match the
previous year’s figure. Only in Italy, Great Britain, and a few
Eastern European countries were the previous year’s sales
exceeded.
In 2019, sales in the Americas lagged slightly behind
the previous year’s level. Adjusted for positive exchange-rate
and acquisition effects, operating sales decreased by 5 %.
Sales in the U.S. – still ALTANA’s largest single sales market,
accounting for 19 % of total sales – fell by 7 % in operat-
ing terms. A major reason for this decline was a reduction in
"},{"text":"exploration activities. As a result of the lower average crudeoil
price level over the year, the development of new production
sources in the U.S. declined, and so demand for the
corresponding special products of the BYK division fell sig-
nificantly compared to the previous year. In Brazil and other
major Latin American markets, however, operating sales
grew slightly vis-à-vis the previous year. Overall, the Americas’
share of Group sales increased slightly to 28 % (previous
year: 27 %). Asia continued to account for 33 % of Group
sales in the past fiscal year. In operational terms, however,
sales did not reach the level of 2018, down by 6 %. The significantly
weaker economic growth in China, in particular,
resulted in a decrease in demand for the Group’s products
and services in the region. With a sales share of 17 % (pre-
vious year: 18 %), China remains ALTANA’s second largest
market.
Sales Performance of BYK
In the 2019 fiscal year, sales in the BYK division dropped
by 2 % or € 25.0 million to € 1,040.6 million (previous year:
€ 1,065.6 million). This includes positive exchange-rate
changes as well as acquisition effects due to the acquisition
of the business activities of Paul N. Gardner in the U.S. in
the middle of the year. Adjusted for these two effects, operating
sales were 4 % down on the previous year.
In 2019, BYK recorded lower sales in almost all markets
and regions. The effects of the fundamentally difficult over-
all economic environment and, in particular, the weak demand
in the automotive industry were reflected in a significant
year-to-year decline in demand. A significant portion of the
sales decline is attributable to the division’s business with
additives for the plastics industry and reduced demand in the
oil and gas sector due to the drop in crude oil prices over
Sales by division
1
4
2
3
15.8 %
22.0 %
46.3 %
15.9 %
in € million 2018 2019 Δ % Δ % op.
1 BYK 1,065.6 1,040.6 - 2 - 4
2 ECKART 382.6 356.2 - 7 - 9
3 ELANTAS 506.6 494.5 - 2 - 4
4 ACTEGA 352.6 357.7 1 0
Total 2,307.4 2,248.9 - 3 - 4
Sales by region
1
4
2
3
27.6 %
32.5 %
38.2 %
1.7 %
in € million 2018 2019 Δ % Δ % op.
1 Europe 875.0 858.0 - 2 - 2
thereof Germany 273.4 259.1 - 5 - 5
2 Americas 624.4 620.6 - 1 - 5
thereof U.S. 434.8 427.6 - 2 - 7
3 Asia 769.4 731.8 - 5 - 6
thereof China 421.2 388.5 - 8 - 9
4 Other regions 38.6 38.6 - 0 - 1
Total 2,307.4 2,248.9 - 3 - 4
56 Business Development
"},{"text":"Group Management Report Products Safety and Health Environment Human Resources Social Commitment Consolidated Financial Statements 57
the course of the year. In contrast, the previous year’s sales of
measuring and testing instruments were slightly exceeded
thanks to the acquisition made in mid-2019.
In terms of regions, Asia and the Americas were particularly
affected by the operating sales decrease. Developments
in Asia were negatively impacted above all by the significant
decline in operating sales in China, BYK’s second largest
single market. This could not be offset by slight operating sales
growth in some Asian countries, including India and Thailand.
Sales in the Americas also declined in operating terms.
Sales fell noticeably, particularly in the U.S., the division’s
largest single market. In Brazil, by contrast, sales were at the
prior-year level. Adjusted for positive exchange-rate and ac-
quisition effects, the Americas region, similar to Asia, showed
an overall downward trend compared with the previous
year. In contrast, sales in Europe dropped only slightly. A significant
decline, particularly in Germany, was partially off-
set by growth in other major markets on the continent such
as the UK, Italy, and Turkey.
Sales Performance of ECKART
In 2019, the ECKART division generated sales of € 356.2
million (previous year: € 382.6 million). The 7 % decline
vis-à-vis the previous year was influenced by positive exchange
rate effects. Adjusted for these effects, operating
sales fell by 9 %. Of this, 3 percentage points were attributable
to the discontinuation of low-margin trading business
in China. The sales trend in the division’s core business was
slowed in particular by declining demand in the automotive
industry, as well as in other industrial sectors.
The fundamentally difficult market environment was
reflected in almost all regions in 2019. In China, the division’s
complete withdrawal from trade business in 2019 left a
clear mark on sales development. In combination with fundamentally
declining growth in the Chinese market, sales
in Asia were below the previous year’s level. Sales in the Americas
were also well below 2018. Weak sales in Germany
had a negative impact on ECKART’s business activities in
Europe, although not quite as significant as in Asia and the
Americas.
Sales Performance of ELANTAS
In the ELANTAS division, sales in 2019 fell by 2 % or € 12.0
million to € 494.5 million (previous year: € 506.6 million).
Adjusted for positive currency effects, the operating sales
decline amounted to 4 %. This development is due both
to lower sales volumes compared to the previous year and to
a changed product mix. The main driver for the drop in
sales of electrical insulation products was again the generally
weaker economic situation. This development was reflected
in 2019 in all of ELANTAS’ major business areas.
Regional sales dynamics were uneven. ELANTAS achieved
sales growth in the Americas region. Adjusted for positive
exchange-rate effects, sales were at the previous year’s level.
In Europe and Asia, on the other hand, the division recorded
declining sales in all major markets, which were particularly
affected by weak demand in China, ELANTAS’ most import-
ant single market, as well as in Germany and Italy.
Sales Performance of ACTEGA
With sales of € 357.7 million (previous year: € 352.6 million),
the ACTEGA division was the only ALTANA Group division
to post nominal growth of 1 % compared to 2018. This increase
was favored by positive exchange-rate effects. Adjusted
for this effect, operating sales were slightly above the
previous year’s level. A minor decline in sales volumes was
offset by positive effects from a changed product mix and a
somewhat higher price level.
ACTEGA’s business developed positively in the main
application fields. For example, activities with functional products
for food packaging were increased compared to the
previous year, in some cases significantly. On the other hand,
ACTEGA recorded lower sales in the flexible packaging business
as well as in magazines and printed inserts.
"},{"text":"The regional sales structure of the ACTEGA division did not
change significantly in 2019. With the exception of the
U.S. sales market, the overall trend in the division’s core regions
was positive. In Europe, the largest region, net sales
were slightly above the previous year’s level. Operating growth,
particularly in Germany, more than compensated for a decline
in other European countries. In the Americas, nominal
sales increased compared to the previous year. Adjusted
for the positive exchange-rate effects resulting from the development
of the U.S. dollar, operating sales were below the
level of 2018. In the U.S., the division’s largest single market,
operating sales fell sharply in year-to-year terms, while in
Brazil they increased strongly. In Asia, too, the division was
the only one to further increase its sales level in 2019.
Earnings Situation
The operating sales decline was reflected by the earnings
situation. Earnings before interest, taxes, depreciation and
amortization (EBITDA) fell by 3 % or € 14.8 million to
€ 415.8 million (previous year: € 430.6 million). Since negative
acquisition and currency effects had only a minor impact
on earnings, the operating sales decrease adjusted for
these effects also amounted to 3 %. The EBITDA margin
in the 2019 fiscal year, however, at 18.5 % (previous year:
18.7 %), is once again within our strategic target range
of 18 % to 20 %. This was achieved through extensive cost
containment measures, which were already initiated in the
fourth quarter of 2018 in view of the emerging slowdown
in demand.
The development of absolute EBITDA was below our
expectations, as the decline in demand, particularly from the
automotive sector, as well as the general economic slowdown,
was more severe than initially assumed. On the other
hand, the EBITDA margin was almost at the previous year’s
level due to the cost measures implemented and is therefore
in line with our forecast for last year.
The most important cost factor for ALTANA, variable raw-
material and packaging costs, developed positively in rela-
tive terms. The material usage ratio, the ratio of these costs
to sales, fell to 42.7 % in 2019 (previous year: 43.8 %).
All four divisions benefited from this trend, albeit to varying
degrees.
Among the other main cost items, particularly personnel
expenses and depreciation and amortization increased.
Personnel expenses rose by 6 %. The main drivers were the
general increase in collective bargaining costs, exchange-
rate effects, and hiring in the previous year. The ratio of total
personnel expenses to sales increased to 22.7 % (previous
year: 20.9 %) due to the decline in sales. Depreciation and
amortization increased as a result of the high level of investment
in property, plant and equipment and the first-time adaption
of depreciation on rights of use under leasing agreements.
The disproportionate increase in both depreciation and
amortization and personnel expenses affected all func-
tional cost areas.
In general, the structure of the functional costs in
2019 changed only insignificantly compared to 2018.
Within production costs, personnel expenses and depre-
ciation and amortization in particular rose dispropor-
tionately due to the strategic expansion of our sites and
the expansion of production capacity. In contrast, other
major kinds of costs in the production area remained stable
or declined.
In 2019, selling and distribution expenses were slightly
lower than in the previous year, but the relative ratio to
sales increased slightly due to the sales drop. The decline in
selling and distribution expenses was driven in particular
by lower sales commissions and lower travel and trade fair
costs, whereas personnel expenses and depreciation and
amortization rose.
58 Business Development
"},{"text":"Group Management Report Products Safety and Health Environment Human Resources Social Commitment Consolidated Financial Statements 59
Of all the functional cost areas, research and development
expenses exhibited the strongest growth in 2019, as in the
previous year. On account of the continuous expansion of
development activities in nearly all of our four divisions and
the expansion of strategic activities to build future fields
of business, the ratio of research and development costs to
sales increased from 6.7 % to 7.4 %. This trend was additionally
driven by initiatives in application-oriented research
and stepped-up activities to develop new technologies
that can be used to market innovative products. In order to
successfully implement these goals, we intensified our investments
in personnel and laboratories in 2019, which led in
particular to increased personnel expenses and depreciation
and amortization within the functional area of research and
development.
Administrative expenses in 2019 were lower than in 2018,
and the ratio of administrative expenses to sales remained
stable at the previous year’s level.
The balance of other operating income and expenses was
down on the previous year. This development is almost
exclusively due to one-time special expenses in 2019 resulting
from the harmonization of the organoclay product group
in the BYK division. Earnings before interest and taxes (EBIT)
reached € 262.5 million, 10 % below the previous year’s
figure (€ 295.8 million) in operating terms.
At € 7.9 million, the financial result was significantly
better than in 2018 (€ - 7.2 million). The background for the
improvement was in particular interest income received
from tax mutual agreement procedures as well as changes in
the value of investments and an outstanding earn-out obli-
Multi-period overview of the earnings situation
Sales (in € million )
2015 2,059
2016 2,075
2017 2,247
2018 2,307
2019 2,249
EBITDA (in € million )
2015 391
2016 453
2017 470
2018 431
2019 416
"},{"text":"gation from an acquisition. On the other hand, the result of
companies accounted for using the at-equity method
worsened, from € - 24.5 million in the previous year to € - 39.1
million in the 2019 fiscal year. This was due to the higher
annual losses of the Israeli Landa Corporation Ltd. as a result
of the planned higher expenditure for future digital-print-
ing solutions in 2019 in the course of the market launch that
had already begun. This was compounded by the first-time
recognition of depreciation and amortization of the development
expenses identified at the time of acquisition.
Earnings before taxes (EBT) fell to € 231.3 million (previous
year: € 264.1 million), and earnings after taxes (EAT)
to € 169.0 million (previous year: € 187.0 million). As a consequence,
income tax was below the previous year’s level
due to the earnings decline. In addition, the income tax burden
was positively influenced by tax income received from
tax mutual agreement procedures.
Asset and Financial Situation
Capital Expenditure
In the past fiscal year, ALTANA invested a total of € 157.2
million in intangible assets and property, plant and equipment
(excluding the addition of rights of use from leasing
Capital expenditure by division
1
2
3
agreements). As a consequence, capital expenditure was
significantly below the high level of the previous year (€ 187.0
million). At 7.0 %, the investment ratio, that is the ratio of
investments to sales, was above our long-term target range
of 5 % to 6 % due to numerous strategic growth projects.
Overall, € 146.9 million was invested in property, plant
and equipment (previous year: € 171.8 million). For several
4
13.7 %
9.3 %
59.5 %
5 2.4 % 15.1 %
in € million 2018 2019 Δ %
1 BYK 118.8 93.6 - 21
2 ECKART 23.5 21.6 - 8
3 ELANTAS 22.7 14.6 - 36
4 ACTEGA 19.2 23.7 23
5 Holding 2.8 3.7 31
Total 187.0 157.2 - 16
Capital expenditure ALTANA
Group (in € million)
2015 86
2016 122
2017 188
2018 187
2019 157
Germany Abroad
44 42
51 71
131 57
72 115
60 97
60 Business Development
"},{"text":"Group Management Report Products Safety and Health Environment Human Resources Social Commitment Consolidated Financial Statements 61
years, major projects have been carried out for the strategic
expansion of production and laboratory capacities. Investments
in intangible assets reached € 10.3 million in the past
fiscal year, compared to € 15.2 million in 2018.
The regional distribution of investments did not change
significantly in the past fiscal year. The European share was
almost unchanged from 2018 at 49 % (previous year: 51%),
with the largest share in Europe attributable to German sites,
as in previous years. By contrast, the Americas recorded an
increase of 40 % in the 2019 fiscal year (previous year: 31 %),
while Asia’s share decreased to 11 % (previous year: 18 %).
In 2019, the BYK division invested a total of € 93.6
million, less than in the previous year (€ 118.8 million). As in
2018, the investment activity focused on the expansion
of manufacturing capacities for rheology additives in the U.S.
and on a site in China. In addition to research and development
capacities at various locations, other investments related
to a facility for carrying out automated product tests
on additives at the Wesel site and strategic digitalization projects.
At € 21.6 million (previous year: € 23.5 million), the
investment volume in the ECKART division was slightly lower
than in the previous year. By far the most significant
share was split equally between the division’s largest site in
Güntersthal and a site in the United States.
The ELANTAS division invested a significantly lower
amount in property, plant, and equipment and intangible assets
than in the previous year (€ 14.6 million compared to
€ 22.7 million in 2018). In the past fiscal year, the division in-
vested primarily at its sites in Italy and the U.S.
Investing € 23.7 million, the ACTEGA division’s capital
expenditure was at a higher level than in 2018 (€ 19.2 million).
Investments in the past fiscal year mainly related to
the expansion of manufacturing capacities and the construction
of a new innovation center at one of the division’s German
sites. More was also invested at the division’s U.S. and
Brazilian sites than in previous years.
Balance Sheet Structure
Key figures
2018 2019 Δ %
in € million
Total assets 3,221.9 3,343.3 4
Shareholders’ equity 2,344.6 2,479.4 6
Net debt (-) /
Net financial assets (+)¹ ( 95.6) (57.7) 40
¹ Comprises cash and cash equivalents, short-term financial assets, marketable securities, loans
granted, debt, and employee benefit obligations.
In the course of the 2019 fiscal year, the ALTANA Group’s
total assets climbed from € 3,221.9 million to € 3,343.3 million.
The increase of € 121.4 million, or 4 %, is mainly
due to continued high investment activity, the first-time adaption
of rights of use under lease agreements, as well as
exchange-rate effects. Particularly the change of the euro in
relation to the U.S. dollar led to an increase in the carrying
amounts of assets and debts of the U.S. Group companies in
the consolidated financial statements.
Intangible assets fell slightly to € 1,023.9 million (previous
year: € 1,044.2 million). There were no business com-
binations or technology acquisitions with a significant impact
on intangible assets in the past fiscal year. In contrast, there
was a significant increase in property, plant and equipment,
which rose further from € 868.2 million to € 970.8 million.
With additions of € 146.9 million, the level of investment in
property, plant and equipment was significantly higher than
depreciation and amortization (without taking into account
the addition of right-of-use assets from leasing agreements).
Exchange-rate effects also led to an increase in carrying
amounts in the Group currency, the euro.
On December 31, 2019, non-current assets totaled
€ 2,211.6 million (previous year: € 2,083.7 million), € 127.9
million up on the previous year. Their share in total assets
increased slightly to 66 % (previous year: 65 %).
"},{"text":"62 Business Development
The change in current assets was influenced particularly by
the decrease in net working capital. Both inventories and
trade accounts receivable fell in the past fiscal year as a result
of the decline in demand and the implementation of spe-
cific measures. The 6 % decrease in inventories to € 348.8 million
was due to a reduction in stocks of finished products
and a lower level of raw materials. The change in inventories
also had a significant impact on the development of total
net working capital. The balance of inventories, trade accounts
receivable, and trade accounts payable fell by € 14.8 mil-
lion to € 547.0 million. The ratio of net working capital, in
relation to the business development of the previous three
months, slightly decreased to 108 days, after 109 days at the
end of 2018, meaning that both the absolute net working
capital and the ratio developed in line with our expectations.
At the beginning of the year, we had forecast a change
in absolute net working capital in keeping with the general
business trend and a slight improvement in scope. Cash
and cash equivalents increased in the course of the year to
€ 264.6 million (previous year: € 239.7 million). Total current
assets fell slightly to € 1,131.7 million (previous year:
€ 1,138.1 million).
On the liabilities side, changes arose primarily due to
the earnings-related increase in equity. Group equity rose by
€ 134.8 million, or 6 %, to € 2,479.4 million (previous year:
€ 2,344.6 million). The increase is attributable to the surplus
in the 2019 financial year and, to a lesser extent, to positive
effects of exchange-rate fluctuations. The revaluation of net
pension obligations had a counteracting effect. The equity
ratio rose to 74 % on December 31, 2019 (previous year:
73 %).
The Group continued to report liabilities from promissory
note loans as an essential component of the debt at the
end of 2019. These liabilities were reduced further in the past
fiscal year by scheduled repayment of a tranche (€ 80.0 million)
and amounted to € 48.0 million at the end of the year,
Structure of consolidated balance sheet
Assets Dec. 31, 2018 Dec. 31, 2019
€ million % € million %
Non-current assets 2,083.7 65 2,211.6 66
Inventories, trade accounts receivable and other current assets 873.9 27 842.4 25
Cash, short-term financial assets, and cash equivalents and
marketable securities 264.3 8 289.3 9
Total asset 3,221.9 100 3,343.3 100
Shareholders’ equity and liabilities Dec. 31, 2018 Dec. 31, 2019
€ million % € million %
Shareholders’ equity 2,344.6 73 2,479.4 74
Non-current liabilities 417.1 13 425.3 13
Current liabilities 460.2 14 438.6 13
Total shareholders’ equity and liabilities 3,221.9 100 3,343.3 100
"},{"text":"Group Management Report Products Safety and Health Environment Human Resources Social Commitment Consolidated Financial Statements 63
which is reported under current debt. Further significant
liabilities as of the balance sheet date related to the liabilities
from leasing obligations reported for the first time amounting
to € 42.9 million.
The total non-current liabilities were affected on the one
hand by the increase in pension provisions due to the further
decline in the discount rate used to discount the corresponding
obligations. On the other hand, the deferred
taxes reported on the liabilities side of the balance sheet
decreased. In total, non-current liabilities increased by
€ 8.3 million to € 425.3 million (previous year: € 417.0 million).
The total current liabilities reported in the balance sheet
as of December 31, 2019, decreased from € 460.2 million
to € 438.6 million. This was partly due to the lower current
financial liabilities from promissory note loans, which were
only partially offset by the first-time recognition of liabilities
from lease obligations. On the other hand, trade payables
also declined.
The net financial debt, comprising the balance of cash
and cash equivalents, short-term financial assets, current
marketable securities, loans granted, debt, and employee
benefit obligations, was reduced to € 57.7 million at the
end of 2019, after net debt of € 95.6 million in the previous
year.
Principles and Goals of Our Financing Strategy
We generally aim to finance our operating business activities
from the cash flow from operating activities. The same
applies to the need for capital expenditure, which caters to
the continual expansion of business activities.
As a result, our financing strategy is oriented to keeping
the cash and cash equivalents generated within the Group
centralized. In addition, a financing framework is sought that
enables ALTANA to flexibly and quickly carry out acquisi-
tions and even large investment projects beyond the accustomed
scope.
To successfully implement these goals, we manage nearly all
of the Group’s internal financing centrally via ALTANA AG.
To this end, cash pools are set up for the important currency
areas.
At the end of 2019, ALTANA’s liabilities still totaled
€ 48.0 million due to the issuance of promissory note loans.
The loans will be repaid by 2020. Furthermore, there is a
general syndicated credit facility of € 250.0 million. The term
of this credit facility will last until 2022 and had not been
utilized on the balance sheet date.
This financing structure offers ALTANA the flexibility it
needs to appropriately take advantage of short-term or
investment-intensive growth opportunities. The distribution
of the maturities of the financing instruments we use
enables us to optimally control repayment of liabilities with
inflows from operating cash flow.
Off-balance-sheet financing instruments result from
purchasing commitments and guarantees for pension plans.
Details on the existing financing instruments are provided
in the online Consolidated Financial Statements.
Liquidity Analysis
Key figures
2018 2019 Δ %
in € million
Cash flow from
operating activities 296.2 386.3 30
Cash flow from
investing activities (195.7) (228.8) - 17
Cash flow from
financing activities (135.9) (134.6) 1
In the course of 2019, cash and cash equivalents increased
by € 24.9 million to € 264.6 million (previous year: € 239.7
million). At € 386.3 million, cash inflow from operating
"},{"text":"activities was significantly higher than in the previous year
(€ 296.2 million), despite the lower Group net income. This
is primarily due to the fact that the funds tied up in
net working capital were reduced in the course of the year,
whereas in the previous year the balance of inventories,
trade accounts receivable, and trade accounts payable was
still increasing. The change in inventories was the main
driver of this development. In addition, a higher proportion
of net income in the past year was attributable to noncash
expenses.
Cash flow from investment activities rose to € 228.8 mil-
lion (previous year: € 195.7 million). Although investments
in intangible assets and property, plant and equipment were
at a lower level than in the previous year, the repayment
of a loan of € 71.0 million was made in the previous year and
expenditure on acquisitions in 2019 was higher than in
the previous year.
In the 2019 fiscal year, cash flow from financing activities
amounted to € 134.6 million and was thus at the previous
year’s level (€ 135.9 million). The current debt outflows
concerned the scheduled repayment of a promissory note
tranche totaling € 80.0 million and lease payments. In the
2019 fiscal year, ALTANA AG paid a dividend amounting
to € 50.0 million (previous year: € 80.0 million).
Value Management
Key figures value management
2018 2019
in € million
Operating capital (annual average) 2,762.7 2,856.6
Operating earnings 258.6 250.1
Return on capital employed (ROCE) 9.4 % 8.8 %
Weighted average cost of capital 8.0 % 8.0 %
ALTANA
Value Added (relative AVA) 1.4 % 0.8 %
ALTANA
Value Added (absolute AVA) 37.6 21.6
ALTANA determines the change in the company’s value via
the key figure ALTANA Value Added (AVA), whose calculation
is explained in the “Group Basics” section. In 2019, a
positive contribution was made to our company’s value
again, which, however, was lower than in 2018 and was
below our expectations.
The sales-related decline in earnings is reflected in lower
operating earnings, which at € 250.1 million did not
quite reach the previous year’s level (€ 258.6 million) and was
boosted by a positive non-recurrent effect resulting from
the tax rate used in the calculation. At the same time, the
Group’s average capital employed rose to € 2,856.6 million
in 2019 (previous year: € 2,762.7 million). This increase in
capital largely resulted from the high level of investment
in property, plant and equipment over the past two years.
Changes in exchange rates also contributed to the higher
capital level. With an unchanged cost of capital rate of 8.0 %,
the cost of capital rose to € 228.5 million (previous year:
€ 221.0 million).
The return on capital employed (ROCE) amounted to
8.8 % in 2019 and thus did not reach the previous year’s level
(9.4 %). Absolute value added amounted to € 21.6 million
in the past fiscal year, compared to € 37.6 million in the pre-
64 Business Development
"},{"text":"Group Management Report Products Safety and Health Environment Human Resources Social Commitment Consolidated Financial Statements 65
vious year, and relative AVA fell from 1.4 % to 0.8 % in
2019.
The slight improvement in value management key figures
forecast for 2019 could not be achieved due to the
weaker earnings performance.
Overall Assessment of Our Business
Performance and Business Situation
In the course of 2019, the macroeconomic framework deteriorated
increasingly, leading to a decline in demand, particularly in
the automotive industry and in the important sales market China.
As a result, we were not able to achieve our sales and earnings
targets in 2019. However, the effects of the sales decrease on
the earnings situation were largely offset by the early introduction
of comprehensive countermeasures on the cost side, so that
profitability was within our strategic target range. At the same
time, we continued to press ahead with our strategic activities
to develop medium- to long-term growth areas and with the digital
transformation.
Our balance sheet continued to show a very solid structure
at the end of 2019 and offers sufficient financial headroom for
investments in sustainable profitable growth.
"},{"text":"66 Innovation and Employees
Innovation and Employees
Innovation
As a specialty chemicals company, innovations are an important
factor for ALTANA, enabling us to offer our customers
new, competitive solutions and at the same time to meet
cutting-edge requirements regarding performance profile,
costs, environmental protection, and sustainability. Thanks to
close cooperation with our customers we are integrated
into new fields of development at an early stage and thus
can develop customized solutions quickly and reliably. We
build on existing competencies, on the one hand, and gain
access to new ones on the other, in order to continuously
adapt our product portfolio to market and customer needs.
State-of-the-art analytics in chemical labs as well as appli-
cation technology testing laboratories geared to specific features
are available to our researchers and developers for
targeted development.
In addition to the activities in the business divisions,
selected innovations are initiated and coordinated at the
ALTANA level, aimed at tapping new business fields and
absorbing technology and market trends. This is achieved
through different procedures, namely, through the ALTANA
Institute, the central management of technology platforms,
as well as corporate venturing investments.
With the help of the ALTANA Institute, external networks
and close cooperation with universities and research institutes
around the world are used to harness outside impetus.
This year, the first projects were successfully completed
after a three-year period and a technology transfer to the
respective business areas began.
In the 2019 fiscal year, ALTANA again invested an above-
average amount in technology platforms and thus accel-
erated research activities that had been initiated in previous
years. The Printed Electronics platform reached an impor-
tant milestone. After years of intensive research and development,
it was integrated into the organization of our
ELANTAS business unit to be able to optimally utilize synergies
in sales as well as market penetration. In 2019, ALTANA
also made considerable progress in the field of 3D printing
for additive production. ALTANA and the printer manufac-
turer dp polar, in which the company has had a stake since
2017, presented the world’s first 3D printing system with
a continuously rotating print platform at the leading international
trade fair for additive manufacturing Formnext.
The printing inks specially developed by ALTANA for this purpose
enable the components to be produced according to
customer-specific requirements with high precision and productivity
in areas such as the automotive, aerospace, and
medical technology sectors. The laser transfer technology
Heliosonic, which has also been set up as a technology
platform, can open up further market segments in collabo-
ration with dp polar in the medium term. In 2019, the
Heliosonic platform succeeded in putting the first prototype
into operation. As a result, the future direction of the sys-
tem can be shaped in discussions with customers.
Research and development expenses (in € million )
2015 128.1
2016 129.3
2017 142.5
2018 154.1
2019 165.6
"},{"text":"Group Management Report Products Safety and Health Environment Human Resources Social Commitment Consolidated Financial Statements 67
Thanks to the close cooperation between the central departments
Corporate Innovation and Corporate Venturing,
ALTANA can continuously examine technology and market
potential and enter new attractive markets by means of targeted
investments in transformative technology companies.
In this context, ALTANA further intensified its investment
in the Israeli industrial digital printing company Velox Ltd. in
the 2019 fiscal year.
The basis for our innovative strength is an open and
dynamic corporate culture that gives the 1,174 employees in
our research and development centers around the world
the freedom to act creatively and entrepreneurially. The equipment
in our development centers enables our employees
to implement their ideas in marketable solutions. In the year
under review, expenses for research and development
amounted to € 165.6 million, a significantly higher amount
than in the previous year (€ 154.1 million). The further increase
in research and development expenses to 7.4 % of
sales (previous year: 6.7 %) is linked to the achievement
of important milestones and the translation of individual customer
requirements into future, innovative products.
Employees
At the end of 2019, the companies of the ALTANA Group
employed 6,476 people worldwide (previous year: 6,428). The
number remained very stable over the course of the year,
with an increase of 48 people or 1 %. The slight rise of 1 %
is primarily due to an acquisition in the BYK division (+ 27
employees).
In the BYK division, the workforce rose slightly by 23
to 2,347 (previous year: 2,324). The increase is due to the
opposite effect. On the one hand, 38 employees were
transferred to a Group holding company, where cross-divisional
services have been increasingly bundled since 2018.
This decline was offset by the newly acquired business activities
of Paul N. Gardner in the USA (+ 27 employees), which
were integrated into BYK’s testing and measuring instrument
business in mid-2019. The number of employees also increased
in the course of the year as a result of the strategic
expansion of activities in the additive business in Shang-
hai and the testing and measuring instruments business in
Germany.
By contrast, the staff numbers in the ECKART division
decreased by 17 to 1,701 in the course of 2019 (previous
Employees in research and development
BYK 502
ECKART 270
ELANTAS 165
ACTEGA 226
Holding 11
Total 1,174
Employees by division
1
5
2
3
26.3 %
16.6 %
36.3 %
3.1 %
4 17.7 %
Dec. 31,
2018
Dec. 31,
2019
Δ %
1 BYK 2,324 2,347 1
2 ECKART 1,718 1,701 - 1
3 ELANTAS 1,087 1,078 - 1
4 ACTEGA 1,151 1,148 0
5 Holding 148 202 36
Total 6,428 6,476 1
"},{"text":"year: 1,718). The lower headcount particularly affected the
German sites in Hartenstein and Wackersdorf and the division’s
U.S. sites. It is attributable to the challenging economic
situation and the associated capacity utilization, as well as
corresponding countermeasures, which limited staff recruitment
to an absolute minimum in 2019.
ELANTAS recorded a slight decline of 9 employees to
1,078 (previous year: 1,087). But the development within the
division was uneven. The workforce was increased only
in manufacturing. Meanwhile, the number of employees in
other areas decreased.
In the ACTEGA division, the number of employees
remained virtually constant during the year at 1,148 (previous
year: 1,151). While the headcount increased at the German
sites in particular, the number of employees decreased
at its sites in the U.S. and Brazil.
Staff numbers of the Group holding companies climbed by
54 to 202 in the past fiscal year (previous year: 148). This
is mainly due to the expansion of the activities of the service
company implemented in the previous year at the holding
level (+ 38 employees). In 2019, the holding company took
over the financial accounting and general administration
functions for the Wesel site as well as an SAP Competence
Center. The staff had previously been employed in the BYK
division.
The functional structure of the workforce did not alter
significantly in the 2019 fiscal year. With 51 %, or 3,329
people (previous year: 3,373), most of the employees continued
to work in production, although this was the only
area in which staff numbers declined in the course of the year
due to lower capacity utilization. In contrast, the number
of people working in research and development increased by
Employees by functional area
1
4
2
3
16.2 %
18.1 %
51.4 %
14.3 %
Dec. 31,
2018
Dec. 31,
2019
Δ %
1 Production and logistics 3,373 3,329 - 1
2 Marketing and sales 1,002 1,046 4
3 Research and development 1,128 1,174 4
4 Administration 925 927 0
Total 6,428 6,476 1
Employees by region
1 2
3
23.1 %
13.2 %
63.7 %
Dec. 31,
2018
Dec. 31,
2019
Δ %
1 Europe 4,088 4,122 1
thereof Germany 3,320 3,353 1
2 Americas 1,508 1,496 - 1
thereof U.S. 1,241 1,232 - 1
3 Asia 832 858 3
thereof China 513 539 5
Total 6,428 6,476 1
68 Innovation and Employees
"},{"text":"Group Management Report Products Safety and Health Environment Human Resources Social Commitment Consolidated Financial Statements 69
46 to 1,174 in 2019 (previous year: 1,128). The number
of employees in marketing and sales also increased, by a total
of 44, in the course of 2019. As in previous years, adminis-
trative functions continued to account for the smallest share of
the Group-wide workforce, with 927 employees (previous
year: 925). The number of employees in this area remained
virtually unchanged over the course of the year.
In 2019, there were only minor shifts in the regional
structure compared to the previous year. With 4,122 employees
(previous year: 4,088), the European Group companies
continued to employ by far the largest number of people.
3,353 (previous year: 3,320) were employed in Germany
at the end of the year, the majority of them at ECKART’s
and BYK’s largest production sites, in Hartenstein and Wesel,
respectively. The number of employees in the Americas fell
slightly by 12 from 1,508 in the previous year to 1,496 at the
end of 2019 despite the acquisition of the business activi-
ties of Paul N. Gardner. By contrast, the number of employees
in the Asian Group companies rose from 832 in the pre-
vious year to 858 in 2019, the largest percentage increase.
At the end of the 2019 fiscal year, 1,689 women and
4,787 men worked for ALTANA. On the balance sheet date,
90 % of all employees had an unlimited and 10 % a lim-
ited employment contract. This ratio was the same for both
genders. At the end of 2019, 77 % of the female employ-
ees were working full-time and 23 % part-time. 97 % of the
male employees worked full-time. Apart from its own employees,
150 people from employment agencies worked for
the ALTANA Group on December 31, 2019.
ALTANA continues to compete internationally for specialists
and managers. Like all companies in the chemical
industry, in the years to come the ALTANA Group, particularly
in Europe, will enter a phase that due to the demographic
development has made precision succession planning indispensable.
As a result, talent management and human-resource
development play a key role in ALTANA’s agenda for
the future (Keep Changing Agenda). The aims are to mobilize
people at ALTANA, to increase diversity at all levels, to further
develop leadership culture, and in doing so to strengthen
entrepreneurial thinking and action. To achieve these goals,
we examined and revised existing personnel tools in 2019.
We focused on the revision of the so-called compass dialogue
(annual talks with employees). The progress dialogue as
part of the compass dialogue is to be supplemented in the
future by an assessment of competence and potential as well
as a development plan. Hence the competence model
developed in the previous year was integrated even more
strongly into the existing human-resource instruments. All
of these innovations aim to optimize the basis for personnel
decisions. Increased transparency and dialogues with the
respective managers, which are even more strongly focused on
employee development, will make employees even more
loyal to the company. In this way, ALTANA is particularly concentrating
on more effective succession planning.
The “HR Transformation” project launched in previous
years, which serves to strategically reposition personnel, was
continued in 2019. To be able to meet future challenges
on the labor market in an increasingly digitalized world in the
best possible way, in 2019 ALTANA took the first steps on
a global level to redesign its master data and organizational
structures in terms of processes and digitally. These initial
changes form the basis for digitalizing all processes of our
personnel organization in the coming years. In 2020, the
next step is to digitally implement the process families Performance
& Goals and Learning Management. In order to
adequately take into account the operational and strategic
needs of the divisions, ALTANA redefined the organization-
al interaction between local, regional, and divisional roles in
the area of human resources. As a result, for example, divisional
HR managers are appointed for the four divisions and
regional HR managers are appointed across all divisions in
regions with a high number of employees.
"},{"text":"Subsequent Events
In December 2019, ALTANA concluded an agreement on the
acquisition of the business with innovative additives for exploration
of the U.S. company Gulf Scientific Inc. based in
Houston, Texas, by way of an asset deal. The acquisition
was completed on January 2, 2020. The business will be integrated
into the BYK division.
The United Kingdom left the European Union on January
31, 2020, with an exit agreement. This paves the
way for a transitional phase until December 31, 2020, during
which no significant changes to the previous situation
should occur from an economic perspective.
70 Innovation and Employees I Subsequent Events I Expected Developments
Declaration of Corporate Governance Pursuant to
Section 289f (4) of the German Commercial Code (HGB)
Promoting women in management positions remained a
focus in the 2019 fiscal year. By intensifying measures that
had been introduced in the past, and with new instruments,
we further anchored the expansion of diversity in our human-
resource management. The ratio of women in ALTANA’s
national and international management development programs
has increased significantly in recent years. In addition,
our further education program includes special offers for
women. The mentoring program for women launched in
2016 was continued in 2019. In addition, ALTANA created
various informal platforms in order to intensify dialog on
this topic. Among them are regular meetings of women in
management positions that focus on strengthening the
network, and workshops for further development of family-
friendly employment models intended to contribute to
continual improvement of the general working conditions at
ALTANA.
ALTANA’s medium- to long-term goal is to increase
the share of women in management positions to the percent-
age of women in the entire workforce.
In keeping with legal requirements regarding equal
participation of women in management positions in private
business and the public service sector, ALTANA AG’s Super-
visory Board specified targets for the share of women in the
company’s Management and Supervisory Boards. For the
Supervisory Board, a target of 25 % was resolved by the end
of the target-achievement period on June 30, 2020. For
the Management Board, no personnel changes or an extension
of the body are planned by the end of the target-
achievement period, and so the body will continue to be without
any woman. For the first management level under the
Management Board, the Management Board resolved a share
of women of 20 % and for the second management level
a share of 30 %. Targets were also defined for the German
companies subject to codetermination.
"},{"text":"Group Management Report Products Safety and Health Environment Human Resources Social Commitment Consolidated Financial Statements 71
Expected Developments
Future Orientation of the Group
We do not plan on making any fundamental changes to
the Group’s strategy or organizational structure in the next
two years. The focus on specialty markets and the offer of
innovative chemical solutions based on our customers’ requirements
will continue to drive our business development.
We do not expect our entry into new market segments or
application areas to lead to any significant changes in our
sales structure in the medium term. We also expect the balanced
regional sales distribution to basically remain stable.
Acquisitions, however, could lead to changes in our sales
and market structures. Bolt-on acquisitions and particularly
the integration of a new business division could result in a shift.
Economic and Industry Outlook
Global economic growth should slightly recover in 2020
compared with the previous year. The International Monetary
Fund (IMF) forecasts a 3.2 % increase in global economic
output. This would mean growth above the expected level in
2019 (2.9 %).
The main drivers of this development are likely to be the
industrialized nations, although, according to the IMF,
individual countries will benefit from the global upturn in very
different ways. The IMF expects that growth in the U.S.
will continue to weaken (from + 2.3 % in 2019 to + 2.0 % in
2020). In contrast, the IMF forecasts slight growth in the
Eurozone (from + 1.2 % in 2019 to + 1.3 % in 2020). For
Germany, the IMF expects the pace of growth in 2020 to
more than double from 2019 (+ 0.5 %) to 1.1 %. The main
driver is exports, which should benefit German industry
significantly once the global economy stabilizes. However, the
IMF also sees numerous risks in its assessment for 2020
that could lead to a slowdown in global growth. These risks
essentially involve the increasing uncertainty about the
geopolitical situation that could lead to restrictions on international
trade and a renewed escalation in the trade dispute
between the USA and China. The IMF sees problems in
emerging markets, including India, as a further risk.
According to the IMF forecast, growth in the emerging
markets should be over 4 % in 2020 and thus exceed the
previous year’s level and the growth expected for the industrial
economies (+ 1.6 %), but at a much slower pace than
in previous years. This development will continue to be driven
in particular by the Asian economies. China and India are
showing the strongest growth, albeit also at a lower level than
in the previous years. In addition, based on the latest IMF
assessment, consumption in India in particular has recently
weakened more than expected and as a result growth forecasts
for 2020 have been revised significantly downwards,
at 5.8 %. The forecast for China was revised downwards,
from 6.0 % to 5.4 %, due to the Coronavirus (SARS-CoV-2)
infections in February 2020. Latin America is expected to
exhibit an increase in growth momentum compared with the
previous year, although at 1.6 % it would be at a lower
level than is forecast for the emerging economies in Asia.
Against the background of the global economic outlook
for 2020, growth in the general chemicals sector is ex-
pected to remain at the previous year’s level. The American
Chemistry Council (ACC) forecasts a 2.0 % increase in
global chemical production in 2020, compared with an
expected 1.2 % in the previous year. This growth should be
driven primarily by the chemical industry in Latin America
and Europe. However, chemical production should also develop
positively in Asia.
On the basis of the economic and industry-specific
framework conditions, we assume that the general demand
on all of the markets relevant for ALTANA will basically be
positive, although there will be regional and market-specific
differences. The extent to which changes in storage levels
along the value chain will influence the actual demand for the
products of our divisions largely depends on the expected
"},{"text":"short- to medium-term development. Stock-level changes can
lead to significant effects.
The development of crude-oil prices cannot be predicted
reliably. We expect that in 2020 there will be no significant
price movements. The availability, pricing, and consumption
volume of chemical products are subject to the influence
of the crude-oil market, albeit to different extents. In addition,
the expectations of market participants in terms of the future
development of oil prices can result in significant changes
in the level of storage along the entire value chain of the
chemical industry.
As in the previous years, the exchange-rate relations important
for ALTANA may continue to show pronounced
volatilities in 2020. The development of regional interest rates
and economic output, as well as political influences, can be
of decisive importance for exchange-rate fluctuations. Since
the intensity and direction of the exchange rates cannot
be predicted, it is not possible to make concrete statements
about the influence. Concrete risks, as well as opportunities,
can result from a deviation of the actual exchange-rate
development from our planning assumptions.
Expected Earnings, Asset, and Financial Situation
Expected Sales and Earnings Performance
On the basis of the growth anticipated for the global economy,
we expect the demand for our products and services
to exhibit a positive development in the new fiscal year. We
expect our operating sales growth, i. e. sales growth adjust-
ed for exchange-rate and acquisition effects, to be in the low
single-digit percentage range. This growth should result
from an increase in the sales volume and positive effects from
the product mix.
The nominal sales increase in 2020 should be higher due
to already agreed acquisitions and potential further acquisitions.
In addition to the successful acquisition of the activities
of Gulf Scientific in January 2020, we also concluded
an agreement at the end of 2019 to acquire all the shares in
the Swiss company Schmid Rhyner AG. The integration
of Schmid Rhyner, which specializes in print finishing solutions,
should take place in the first quarter of 2020. In
addition, we expect the nominal sales increase in 2020 to be
only slightly affected by negative exchange-rate changes.
For the most part, sales in the divisions should develop in the
same range as Group sales.
In terms of the most important functional cost factors,
we do not foresee significant shifts of cost ratios in relation
to sales. We expect the materials cost ratio to largely undergo
a stable development at the level of the past fiscal year.
For personnel expenses and other fixed cost figures, we
project a relative increase at the same level as sales growth.
Against this background, we anticipate that in 2020 the
EBITDA margin will decline slightly towards the lower end
of our strategic target corridor of 18 % to 20 %. The further
course of the Coronavirus (SARS-CoV-2) infections and
its effects on demand, production, and delivery processes
cannot be estimated at present, but may have an impact
in 2020 on our growth and earnings situation in China and
possibly also at Group level.
After 2020, we expect stable growth momentum with
slightly higher profitability.
Expected Asset and Financial Situation
There should not be any significant shifts in the balance sheet
structure in 2020. In the next two years, our capital expenditure
for property, plant and equipment and intangible assets
should be above our long-term target range of 5 % to 6 %
due to strategic growth projects. The absolute values of net
working capital should develop in line with the general
business trend, although we are aiming for a slight improvement
in ratios.
Based on the anticipated business performance, we
will continue to generate a clearly positive cash flow from
72 Expected Developments
"},{"text":"Group Management Report Products Safety and Health Environment Human Resources Social Commitment Consolidated Financial Statements 73
business situation, our expectations for the current fiscal
year are discussed extensively at the level of the divisions on a
regular basis. As a result, deviations from planned devel-
opments can be recognized and countermeasures introduced
if necessary.
Our internal control system defines organizational and
procedural requirements that serve to prevent damage to
the company, among other things. In connection with our established
compliance organization, it aims to prevent possi-
ble violations of guidelines and laws on the part of employees.
At ALTANA, risk management in the strict sense is
viewed as the systematic compilation, evaluation, documentation,
communication, and, if not already in place, the
derivation of measures regarding the relevant risks. Thus it is
an essential
component of the company’s system for early
risk recognition in accordance with section 91 (2) of the German
Stock Corporation Act. This system was voluntarily
examined by the auditor.
The audit deemed the system capable of recognizing
risks that can endanger the existence of the company at an
early stage.
Risks that are identified are evaluated in a uniform way.
So-called evaluated risks are assessed based on the probability
of their occurring and the potential damages. Individual
risks can be rated based on this assessment. Risks rated as
very high are risks which could cost the company € 25 million
or more in the next twelve months. Individual risks that
could cost the company between € 12 million and € 25 million
are rated as high risks; risks that would cost between
€ 5 million and € 12 million are categorized as medium risks,
and risks that would cost less than € 5 million are deemed
low risks. The prioritization resulting from the assessment determines
focal points for the development and initiation
of countermeasures to prevent or reduce the potential effects
of risks.
The individual risks and risk fields described in the following
pages could have a material adverse effect on the
operating activities in the coming years. In the short term,
however, this may lag behind the very good figures of recent
years. We will use the cash inflow primarily to finance investments
and for bolt-on acquisitions. In addition, the promissory
note loan will also be repaid as scheduled in 2020.
We project the value management key figures for 2020
to decline compared to the past fiscal year. This will be due
on the one hand to a slight increase in operating capital as a
result of expected investments and acquisitions, and on
the other to a decrease in operating income.
Risks
Management and control of the ALTANA Group are geared
to the strategy that has been defined and the target levels
derived from it. Due to changes in the economic environment
or internal factors of influence, it might not be possible to
implement the strategy successfully or to achieve targets in
the planned time frame or to the planned extent. To be
optimally prepared for such situations, ALTANA systematically
identifies, evaluates, and considers risks within the framework
of decision-making processes.
To anchor our risk policy at all decision-making levels,
we established a Group-wide risk management system that
brings together various information, communications, and
monitoring systems. Core elements of our risk management
include strategic corporate planning, internal reporting, our
internal control system, compliance organization, and risk
management in the strict sense, i. e. the identification, documentation,
and evaluation of risks including the derivation of
appropriate precautionary measures and countermeasures.
Our strategic corporate planning is closely tied to our
medium- to long-term financial planning. The extent of
the fulfillment of our targets is examined in monthly reports
on the company’s business performance and in our shortterm
financial planning. Apart from an analysis of the current
"},{"text":"Group’s earnings, financial, and asset situation in the years
to come and thus give rise to a negative deviation from
the forecast development. For individual risks categorized as
“medium,” “high,” and “very high” we address changes
in our appraisal compared to the previous year.
Economy and Industry Risks
The development of the general economic conditions worldwide
has a decisive impact on our business performance.
The performances of the economies of the U.S., China, and
Germany – industrial nations important for ALTANA – have
a particularly strong impact on the direction and intensity of
demand for our products.
A global economic crisis leading to an economic collapse
would bring about significant sales decreases with corresponding
influences on our earnings. Recessions limited to
certain regions in sales markets important for us could also
significantly impair our business performance. With the global
orientation of our sales activities, we try to shape our dependence
on regional or national markets in such a way that
the effects of geographically confined economic crises on
the Group are limited.
Thus, the U.S., the most important single country for us,
currently accounts for almost 20 % of total Group sales.
The distribution of our business activities in the core regions
of Europe, Asia, and the Americas also has a balanced
structure.
At the same time, we continually update our appraisal of
the regional economic development in our internal report-
ing system to be able to react to foreseeable effects by controlling
our procurement, production, and sales activities.
We react to long-term shifts in the regional significance
of sales markets by adjusting our sales and local production
and organizational structures.
In addition to general economic risks, there are market
related sales risks concerning individual product groups
or application areas. Particularly medium-to long-term
trends that structurally lead to a decrease in demand in our
target markets can mean that we will not achieve our
growth and profitability targets. We try to counteract industry
related sales risks by broadly diversifying our offer. We
supply many different industries, which in turn sell their end
products in various markets. Therefore, our dependence
on the underlying markets is limited. Our analyses show that
the important automotive sales market accounts for less
than 20 % of sales. The sales share of other industrial sectors
that are important for ALTANA, including the graphic-
arts industry and the construction sector, are also expected to
not exceed 20 %.
The analysis of our industry-specific and application-related
sales is a component of our annual strategy process.
In addition, we examine changes in future growth potential
arising from demand trends and technological developments,
and adjust our strategic orientation in the divisions if
necessary.
The occurrence of a global economic crisis or the emergence
of regional economic crises are two significant economic
and industry risks, which in 2019 were categorized as
“high” or “medium” and which in the previous year were
still classified as “very high” or “high” risks. In the 2019 fiscal
year, our assessments of the probability of both risks
occurring did not change due to the continuing high level of
uncertainty about economic development
resulting from
various economic risks. However, since a restrained market
development was already taken into account in the medium
term financial planning, the potential losses decreased
compared to the previous year. The evaluated risk of the
two individual risks occurring also declined vis-à-vis the previous
year.
74 Expected Developments
"},{"text":"Group Management Report Products Safety and Health Environment Human Resources Social Commitment Consolidated Financial Statements 75
To minimize the effects of the risks from business combinations,
we examine our acquisition targets systematically
and comprehensively and analyze them in detail in a multistage
approval process.
We assess the risk of impairments of assets from acquisitions,
which we classify as a medium risk, as being higher
than in the previous year. In the past year, the ongoing weak
economic situation in the industrial sector led to business
developments below expectations, which inevitably leads to
an increase in impairment risks.
Procurement Risks
Limited availability of certain raw materials or substantial
raw-materials price increases that we cannot or can only
partially pass on to the markets in the short term constitute
the primary procurement risks. These can have a negative
impact on the Group’s earnings situation.
We continually analyze the situation on the raw-materials
markets that are relevant for ALTANA. By doing so,
we can identify price trends and structural shifts on the part
of suppliers at an early stage and devise suitable measures.
We take this knowledge into account when we arrange supply
contracts. In addition, we take account of the volatility
of raw-materials prices in our customer relations. To be able
to pass on price increases to the markets in the short term,
we use the flexibility of price mechanisms and price lockup
periods.
The group of procurement risks is still classified as
medium compared to the previous year. However, due to a
lower probability of occurrence and slightly lower losses,
this risk decreased slightly in the past fiscal year.
Financial Market Risks
Financial market risks primarily concern short-term and significant
changes in exchange-rate relations and interest
Sales Risks
Sales risks result mainly from intensified competition or shifts
in customer structure. They include sales risks for individu-
al products or product groups due to specific demand trends.
This can lead to decreasing sales revenues, which can
be caused by declining sales volumes or falling prices. Since
in many cases we cannot adjust the cost structure in the
short term, this can lead to a drop in profitability.
We counter sales risks by continually optimizing our
product and service portfolio, above all on the basis of our
innovative ability. In the process, it is decisive that we cooperate
closely with our customers at an early stage of development
work to adapt to market needs. With our innovation
strategy, we can counter increased competition in our
markets.
A loss of, mergers of, or backward integration of customers
can lead to major changes in the customer structure.
Due to our very diversified customer structure, however,
these risks are limited. In addition, we cooperate closely with
our core customers within the framework of our key account
management.
The group of sales risks is still assessed as being “medium.”
In the year under review, we only slightly changed
our assessment of the probability of occurrence and loss potential
from sales risks.
Risks from Business Combinations and Investments
Apart from operating growth, acquisitions of companies,
business activities, and individual technologies play a key
role for the implementation of the strategy for profitable
growth at ALTANA. Depending on the size of the activities acquired,
inadequate integration can place a burden on the
Group’s earnings situation and limit its financial headroom. In
addition, a business performance that is worse than what
was expected when the acquisition was made can lead to impairments
of assets with a negative impact on earnings.
"},{"text":"rates, as well as default risks and the covering of financial-
resource needs.
Due to exchange-rate fluctuations, the translation of
foreign currency positions into the Group currency, the euro,
can have a negative effect on the Group’s sales and earnings
performance (translation risks). Such negative effects can
also result from business conducted in a foreign currency
(transaction risks). As in the previous year, we categorize translation
risk as being a medium risk. Interest-rate changes
influence financing costs. Defaults on trade accounts receivable
or financial receivables can also have a negative effect
on the Group’s earnings situation and its financial resources.
If there is a lack of availability of financial resources for the
implementation of acquisitions or major investment projects,
we might not reach our strategic targets.
We safeguard against material transaction risks by concluding
forward foreign-exchange contracts in cases where
we assume that the underlying business can be realized with
a sufficient degree of certainty. In the case of risks from
operating activities, the total amount expected is safeguarded
in different tranches to offset short-term exchange-rate
fluctuations.
More information on our evaluation and accounting
procedures for hedges can be found in the online Consolidated
Financial Statements on page 57 ff. (note 28).
To minimize credit default risks, we systematically ex-
amine the credit rating and payment behavior of our counterparties.
The latter include customers, the banks we do
business with, and other business partners where payment
default can have an influence on our financial situation.
We safeguard availability of financial resources through
central control and monitoring of our Group-wide finan-
cial resources. In addition, by utilizing various financing instruments,
we centrally provide a financial resources framework.
It can be used to cover unplanned financial requirements in
the short to medium term (e. g. due to acquisitions).
Our assessment of financial market risks is nearly unchanged
vis-à-vis the previous year. We evaluate the most impor-
tant individual risk in this risk group, namely negative effects
on earnings from exchange-rate changes, as having the
same probability of occurrence as in the previous year and a
slightly lower potential to lead to losses. Continued high
cash inflows from operating business activity and the existing
general financial resources framework continue to suffice
to cover the expected cash outflows for investments, repayments,
and dividends.
Innovation Risks
ALTANA’s position as an innovation and technology leader is
a major success factor for the company. It is important for
a supplier of highly specialized chemical products to continually
introduce new products on the market and to be perceived
by our customers as a competent and innovative partner.
If this was no longer the case in the future, risks could
result for our sustainable growth, the attainment of our profitability
targets, and ALTANA’s positioning in the relevant
markets. The same applies if competitors patent knowhow
that we use but have not protected, as we would then no
longer be able to use it, or only at additional cost.
With our innovation culture, which is put into practice
at all levels of our organization, we highlight the importance
of innovation and safeguard its status. Both at a decentralized
and a Group level, we can continually evaluate
and control our research and development activities based on
financial and non-financial criteria. By investing above-average
amounts in research and development and focusing on
product adjustments and new developments, we can con-
tinually introduce products on the market that are tailored to
customers’ individual and current needs and thus positively
influence our competitive position.
It is important to protect knowhow we develop with
patents to convert our knowledge edge into economic suc-
76 Expected Developments
"},{"text":"Group Management Report Products Safety and Health Environment Human Resources Social Commitment Consolidated Financial Statements 77
analyses to assess the hazardous potential of our input
materials and products, and we conclude insurances.
Changes in political and regulatory framework conditions
can lead to restrictions on trade or foreign-exchange
transactions. Due to political unrest, it can be more difficult
or even impossible to access the Group’s assets in the
country or countries in question. On account of regulatory
adjustments, it might no longer be possible to process or
sell certain products or ingredients, or only with strong restrictions.
We continually examine the political environment
in the countries important for us and take current tendencies
into account when evaluating business relationships. We
only make direct investments in countries in which we assume
the political environment is highly stable. We actively take
part in legislative procedures and discussions important for us
that focus on changes in the regulatory environment. As
a result, we can anticipate possible new requirements early
on.
In the past fiscal year, with largely unchanged probabilities
of occurrence, loss values increased, especially regarding
risks due to tariff trade barriers and due to ongoing
initiatives to regulate chemical products in various countries.
The United Kingdom left the European Union on Janu-
ary 31, 2020, with an exit agreement. This initially provides
for a transitional phase until December 31, 2020, during
which there should be no significant changes to the previous
situation from an economic perspective. If no comprehensive
trade agreement between the United Kingdom and the
European Union is concluded and ratified by the end of
the transitional period, there is still the risk of a medium-term
restriction of business relations. This scenario still does not
represent a significant individual risk for ALTANA. Due to the
fact that the withdrawal was postponed several times last
year, we already identified and prepared all measures that
would have had to be implemented in 2019 in the event
of such a scenario. We estimate the potential negative imcess.
This includes safeguarding technologies as well as
methods and product properties we currently use so that
other companies cannot patent them.
Due to an expansion of activities in the field of digital
applications and business models and the risks associated
with them, our assessment of innovation risks in 2019 was
slightly higher than in the previous year. However, the innovation
risk is still classified as low overall.
Other Risks
Production risks concern technical disruptions or human
failure in production that can be harmful to people or the environment.
Our goal is to minimize the effects of machine
failure on the value chain by operating production lines independently
from one another. It is compulsory for our staff
to receive training in the clearly defined process and quality
standards in the areas in question. In addition, we conclude
property damage as well as plant and equipment break-down
insurances.
Information technologies form the basis of nearly all of
ALTANA’s business and communications processes. Breakdowns
or other disruptions of IT systems can lead to far-reaching
impairments in all of the Group’s value-added stages,
which can have significant effects on business performance
(IT risks). In addition, potential risks arise from data loss or
theft of business secrets. ALTANA attaches great importance
to smooth availability of IT applications and services. To
guarantee this, corresponding processes and organizational
structures have been established. Emergency plans are
in place in case of significant disruptions or losses of data.
Delivery of faulty products can cause damage to peo-
ple, property, or the environment and thus cause liability risks.
This can have significant effects on the Group’s asset situation.
We minimize this risk by standardizing production processes
to a large extent and by taking comprehensive qual-
ity
control measures. In addition, we continually conduct
"},{"text":"pact on earnings that could result from increased customs
duties and higher administrative expenses for imports and
exports to be low in absolute terms. In addition, there is
a comparatively low risk that the availability of raw materials
will be restricted by the discontinuation of REACH certifications
for products that have so far only been registered in
the United Kingdom.
Legal violations (compliance risks) can give rise to
liability risks or tarnish our reputation, which can have a significant
effect on the Group’s earnings and asset situation.
We counter these risks within the framework of our compliance
management system, inter alia by regularly inform-
ing and training our employees about relevant legal requirements.
An important basis for long-term success are competent
and committed employees. Should we no longer be able to
recruit or retain suitable specialists or managers in the future,
risks could arise for the successful implementation of our
strategy (personnel risks). To counter these risks, ALTANA offers
a sophisticated work environment and an attractive
compensation system, which is supplemented by various pension
plans and wealth creation schemes. Moreover, we
regularly offer further education and training programs to
budding junior staff members, as well as to specialized
and managerial staff.
Production processes and / or supply chains can be impaired
or interrupted by the transnational effects of diseases
and any resulting measures that may be necessary to stop
the disease from spreading further. Thus, there is the risk of
economic losses. However, since these risks generally occur
only for a limited time and only in certain places, we assess
the effects on ALTANA generally to be minor due to our
decentralized structures and the fact that our sites are distributed
around the world. The further course of the Corona-
virus (SARS-CoV-2) infections can have an impact on the economic
development, especially in China, but possibly also
in other countries. Both the duration and the concrete effects
on ALTANA’s economic performance in 2020 cannot be
quantified at present.
Compliant Group Accounting
Essential accounting-related risks arise particularly when extraordinary
or non-routine issues are handled. These include
the first-time consolidation of acquired businesses or parts
of companies as well as the recording of the sale of Group
assets. Accounting of financial instruments is also subject
to risks due to the complex evaluation structure. Risks also
arise from fraudulent acts.
At ALTANA, a separate department of the Group’s holding
company coordinates and monitors Group accounting.
A core component of the control system are the guidelines,
process descriptions, and deadlines that this department
defines centrally for all companies, guaranteeing a standardized
procedure for preparing the financial statements. For
complex issues, the instruments needed for uniform accounting
are retained centrally for all Group companies. For recording
extraordinary processes and complex special issues,
we regularly obtain external reports, advice, and statements.
The financial statements of the individual Group companies
are prepared decentrally by the local accounting
departments. Hence the individual companies are responsible
for preparing the financial statements, in keeping with
Group guidelines and country-specific statutory accounting
requirements.
The work steps needed to prepare the financial statements
are defined such that important process controls are
integrated. These include guidelines pertaining to the separation
of functions and allocation of responsibilities, to control
mechanisms, and to IT system access regulations. The
respective management explicitly confirms to the Group’s
management that the annual financial statements are cor-
rect and complete. In addition, important financial statements
are audited by the company or Group auditors in charge.
78 Expected Developments
"},{"text":"Group Management Report Products Safety and Health Environment Human Resources Social Commitment Consolidated Financial Statements 79
The local financial statements are recorded and consolidated
via standardized formats and processes in a central IT system.
At the divisional and holding company levels numerous
manual and IT-assisted control mechanisms are applied.
They encompass an analysis and a plausibility examination of
the registered data and the consolidated results by Group
accounting as well as by the controlling department and other
departments with expertise in this area. Required corrections
of the information in the financial statements are generally
made at the level of the individual company to ensure
the data are uniform and are transferred.
The company auditor and the Group auditor examine
issues, processes, and control systems relevant for the gen-
eration of financial statements. The Group auditor reports on
the audit directly to the Supervisory Board and the Audit
Committee. In certain cases, audits are carried out by the central
Internal Audit department.
After each process related to the preparation of the
financial statements, optimization potential identified at the
different levels is analyzed and necessary adjustments of
the processes are made.
Opportunities
The identification and evaluation of opportunities for our
future business development is integrated into the different
planning, analysis, and control processes.
Within the framework of strategic planning, we analyze
demand trends as well as market and technology developments
with regard to options for action that could enable
ALTANA to create value. In addition, the divisions contin-
ually examine possibilities of developing new sales markets.
During the financial-planning process, the effects of action
options are evaluated and discussed so that we can optimally
exploit future opportunities. Finally, possible opportunities
for short-term business development, along with the attendant
risks, are dealt with in detail at all levels of management.
Below, major opportunities are described that could lead
to ALTANA’s surpassing its short-, medium-, or long-term
goals. The order corresponds to our assessment of the effects
on our business performance.
Economic and Industry Development
Should the economic environment in the established industrial
regions important for ALTANA, particularly in the U.S.,
China, and Europe, develop better than we anticipated, unexpected
growth impetus could arise. As a result, demand
for our products and services could develop more positively
and exceed our forecast. The same applies to growth in
the important emerging countries in Asia and South America.
If the growth rates in these nations were higher than expected,
we might be able to benefit from this to a disproportionately
high extent due to our market positions.
In addition to regional factors, growth impetus can also
result from individual branches of industry. Further poten-
tial could be opened up, in particular, if the automotive sector
and the construction industry showed a positive devel-
opment, or if there was a trend reversal concerning the use
of silver and gray colors in the consumer sector.
Innovation
We have to continually streamline our product and service
portfolio to be able to continue to pursue our strategy for
profitable growth in the long term. Should ALTANA manage
to enhance its innovativeness more quickly than expected
or to increase its share of new products for which there is a
high demand beyond the target level, there would be even
better prospects for growth. The same applies if we entered
new markets or opened up new application fields for our
products.
"},{"text":"Business Combinations and Portfolio Measures
Acquisitions play a key role in ALTANA’s long-term value
creation. In recent years, we have continually advanced the
Group strategically due to acquisitions. At the same time,
we cleansed our portfolio of those activities that were not in
line with our strategic aims and for which there were
no long-term value-creation perspectives within the Group.
In the future, we intend to continue to boost our
growth by acquiring businesses and activities. This is an essential
prerequisite for us to achieve our strategic growth targets.
Should opportunities arise in the future that exceed our
expectations, these new activities could help us strengthen
our market positions and open up new market segments. This,
in turn, could help us achieve our strategic targets more
quickly.
Synergies
The ALTANA Group is decentralized to a large extent. Still,
in some areas of the value-creation chain and in certain
management functions, central units support the divisions
and play a coordinating role. To the extent that we man-
age to push forward the networks within the Group more
strongly than expected, this may spawn further potential
to improve efficiency.
The Management Board’s Overall Statement
on the Anticipated Development of the
Group Including Its Overall View of the Risk
and Opportunity Situation
For 2020, we expect global economic growth to be somewhat
stronger than in the previous year, especially in the second half
of the year. In this environment, we expect ALTANA to achieve
operating sales growth in the low single-digit percentage range
with slightly lower earnings profitability. The acquisitions already
agreed upon will lead to additional sales growth, but will temporarily
weaken the key performance indicators for value-oriented
management.
We believe that the risk of burdens from a development of the
global economy that is worse than we expected or even recessive,
or in important core regions, continues to exist. In addition,
considerable risks to our short-term sales and earnings performance
are posed by the higher price volatility on the raw-materi-
als markets, by impairments for intangible assets acquired
within the framework of acquisitions, and by short-term exchange-
rate fluctuations.
Overall, we have not found any risks that could endanger the
continued existence of the company. The risks we face are set
against opportunities that could enable us to achieve sales and
earnings performance surpassing our forecasts.
80 Expected Developments
"},{"text":"Products
Our innovative products contribute to resource conservation
and climate protection. With them, we help our customers
to produce low-emission or energy-efficient products and to
increase the safety of their products.
82
82
83
83
84
84
Sustainable Product Strategy
Products and Technologies for More Climate Protection
Sustainable Effects for Customers
Certifications for Products with High Sustainability
Replacement of Critical Substances
Products from Renewable Resources
"},{"text":"Sustainable Product Strategy
ALTANA offers companies around the world specialty chemical
solutions that make products used in daily life better
and more sustainable. We convince our customers with added
value and give them a competitive edge through our work.
Some solutions improve, for example, the functions of end
products and increase their shelf life. Others optimize our
customers’ value chain in terms of energy and resource consumption.
And still others enable our customers to reduce
the amount of critical substances in their end products or to
replace them with less critical ones. Therefore, innovative,
environmentally
friendly, safely processable products play a
key role. They help ALTANA’s customers implement their
own sustainability concepts. Based on this understanding
of sustainability, the Group continuously leverages new
fields of business
and paves the way for further profitable
growth.
Due to their strong customer orientation, many
ALTANA
companies gear their innovation strategies systematically
to a catalog of sustainability criteria at a very
early
stage of product development. This includes responsible
handling of resources (water, energy, and raw materials)
as well as the goal of developing products whose effects on
the environment are as low as possible without detracting
from the product’s function. This is reflected by the increasing
number of coatings, additives, and pigment formulations
that are conceived for water-based applications and do not
need organic solvents.
Another aim of ALTANA’s product strategy is to replace
critical components with less critical ones whenever possible.
For products that need classifications due to national or
international hazardous substance regulations, ALTANA’s
companies have special data sheets on hand that provide
consumers with important information on safe storage
and further processing. Moreover, certified lifecycle analyses
are available for certain products.
Products and Technologies for More Climate
Protection
In the period under review, all divisions made progress
with products and technologies that enhance climate protection.
ACTEGA acquired and further developed an innovative
technology for the production of labels in the U.S. that
requires less material. It can save up to 80 percent in material
and significantly reduce the amount of waste. With this
technology, layers are printed in reverse order (1. top coat,
2. colors and 3. adhesive) on a release film and then transferred
to the object to be printed using specially developed
hardware. Since there is no label film on the item, the recyclability
is also improved substantially.
In addition, ACTEGA further reduced the share of raw
materials based on fossil fuels. For example, about 20 tons
of a raw material deployed to produce water-based paints
were conserved. In another project, ACTEGA achieved a signifi-
cant reduction of emissions of volatile organic compounds
(VOC). Through the targeted exchange of various raw materials,
VOC emissions were reduced by a total of around
40 tons. At the same time, the proportion of water-based
sealing compounds was increased further. This reduces
CO² emissions by an average of approximately 1.5 kg per kg
of sealant compared to products on an organic basis.
In the past years, BYK developed a new technology for
manufacturing additives. The core of this technology is a
reaction-mixing pump in which the raw materials are continuously
fed into a special mixing chamber. The advantages,
compared to conventional production in reactors, are the very
short reaction times, the lower energy consumption, and
the reduction of waste and emissions. BYK has already produced
the first wetting and dispersing additives using this
technology.
Furthermore, the division is working with a partner to
develop new and innovative technology for the extraction of
82 Products
"},{"text":"Group Management Report Products Safety and Health Environment Human Resources Social Commitment Consolidated Financial Statements 83
effects have not only economic benefits but also positive
effects on the environment.
For instance, the printing varnishes newly developed
by ACTEGA in the year under review, which are cured using
LED spotlights instead of mercury vapor lamps, make a
sustainable contribution. As a result, customers can achieve
energy savings of up to 80 percent during the hardening
process and mercury is avoided as waste. In addition, some
of these products meet various food law requirements.
At ELANTAS, resins were developed that extend the service
life of electric motors, among other things. As a result,
intervals for expensive and time-consuming replacement procedures
can be increased. ELANTAS also launched new
resins with improved temperature stability for other applications.
For example, the division developed a silicone resin
that is used as an insulating material in load magnets. This
can significantly extend the service life, for example, when
transporting hot metal parts.
Certifications for Products with High
Sustainability
The ACTEGA product ARTISTICA RB1006 Z3, a sealing
compound for use in beverage cans, received the Platinum
level of certification in the material health category of the
Cradle to Cradle Products Innovation Institute. This highest
award is given to products that meet the strictest requirements
in this category. Key criteria involve the raw materials,
production, use, and ultimately the disposal or recycling
of the final product. The certificate is proof of the high level
of innovation and its ability to respond promptly to the
most demanding requirements of the beverage packaging
industry.
copper and other metal ores. The “flotation process” currently
in use will be advanced significantly. With the help of a
functional polymer matrix and special surface additives, the
deposition rate of the metal can be increased compared
to the current standard. These improvements lead to a significant
reduction in the energy required for grinding and
processing the ore, while at the same time improving throughput.
This technology has already been tested with several
types of ore from different regions. A pilot plant is currently
in operation in the U.S. The company plans to build fur-
ther pilot plants in the coming years, thus paving the way for
commercial plants.
In the year under review, ECKART presented a new
product series for water-based automotive coatings at the
European Coatings Show in Nuremberg. This product
range, with the abbreviation “SFP” (Solvent-Free Preparation),
is solvent-free and thus significantly reduces emissions
during application. This means that current and future legal
requirements can already be met, especially in the U.S.
and China.
The topic of “low-emission resins” was again a con-
cern for ELANTAS this year. For example, the division developed
an emission-free impregnating resin for transformers
at its site in Quattordio, Italy. New resins with lower emissions
and improved application properties were also developed
and launched on the market at the ELANTAS site in China.
With these products, ELANTAS complies with the new
regulatory requirements and additionally enables customers
to manufacture their products with less energy consumption
due to faster curing processes.
Sustainable Effects for Customers
On the one hand, ALTANA’s products can simplify our customers’
manufacturing processes, and on the other they
can also significantly improve the properties of products. Both
"},{"text":"84 Products
Replacement of Critical Substances
In the year under review, ALTANA succeeded in replacing
further critical substances. For instance, BYK developed a new
rheology additive that emits significantly lower amounts of
formaldehyde during production than other products. Moreover,
this additive does not contain any flammable solvents.
A number of other rheology products were optimized so
that no alkylphenol ethoxylate has to be used in the formulation.
These ethoxylates can have negative effects on
human and animal endocrine systems.
The European Chemicals Agency (ECHA) recently classified
some by-products as critical for a number of products
containing silicone. However, BYK succeeded in complying
with the prescribed limits by implementing technical mea-
sures.
In the reporting year, ELANTAS also developed and
launched several new products containing alternative raw
materials in the formulation. This allows these products
to be classified as less critical under chemical regulations.
Products from Renewable Resources
In 2019, ACTEGA Artística in Vigo, Spain, began replacing
a product based on raw materials from crude oil with a
plant-based resin. This will save about 40 tons of a raw material
from fossil sources after the project is completed.
Meanwhile, BYK developed a new surface additive that
consists of 100 percent renewable plant-based raw ma-
terials. This product is emission-free and suitable as a raw
material for products with sustainability certificates. The
main area of application is care products and polishes for various
surfaces, such as leather and furniture.
"},{"text":"Safety and Health
ALTANA relies on an effective safety culture. Technical
and organizational measures as well as training programs
contribute to enhancing work safety and anchoring the
issue firmly in our employees’ minds. Our top priority is
to reduce the number of accidents. We are constantly
working on minimizing hazards and improving the health
protection of our staff.
86
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The Top Priority is Occupational Safety
Incidents in Detail
Worldwide Safety Measures
A Focus on Safety Communication
Health Protection
"},{"text":"The Top Priority is Occupational Safety
Occupational safety and occupational health protection are
top priorities at ALTANA.
Through various technical and organizational measures,
which are adapted to the production conditions at the
sites and to the laws and regulations applicable there, we
ensure continuous improvement in the health and safety of
our employees. To achieve a uniform safety culture, ALTANA
also relies on targeted training programs for employees.
Since 2007, the Work Accident Indicator (WAI) has been
used throughout the Group as the most important key
figure for monitoring and continuously improving the development
of occupational safety at all sites. The indicator
shows the number of accidents at work and lost work days,
and sets them in relation to the total number of hours
worked. On the basis of this data, ALTANA’s Management
Board together with the EH&S department sets three
WAI values as targets for each year, which apply equally to
all companies in the ALTANA Group.
As in previous years, there were no fatal accidents in
2019.
In the year under review, certain sites again achieved
remarkable results in terms of their occupational safety. The
BYK Tongling and ELANTAS Beck India sites, which have
been accident-free for more than eleven years, deserve special
mention. ECKART Zhuhai (nine years), ACTEGA Rhena-
coat and ELANTAS Tongling (eight years each), and ACTEGA
Foshan (seven years) have been accident-free for more than
six years. ACTEGA do Brasil (Santana de Parnaíba), ECKART
Suisse, and ELANTAS Zhuhai have been free of accidents
for more than three years.
Furthermore, ALTANA was able to improve all three
accident indicators (WAI 1, WAI 2, and WAI 3) in the year
under review. Compared to the previous year, the WAI
indicators decreased in all three categories. Thanks to this
WAI 1 (number of occupational accidents with lost work time of
one day or more per million working hours)
2016 3.9
2017 4.0
2018 3.7
2019 2.8
(Target 2020: 2.8)
Target 2019: 3.0
WAI 2 (number of occupational accidents with lost work time of
more than three days per million working hours)
2016 2.5
2017 3.1
2018 2.7
2019 2.1
(Target 2020: 2.0)
Target 2019: 2.1
WAI 3 number of lost work days due to occupational accidents per
million working hours)
2016 38.2
2017 54.6
2018 36.5
2019 34.8
(Target 2020: 35.0)
Target 2019: 40.0
encouraging development, it was also possible to meet the
targets the company had set itself for the year under review.
ALTANA achieved these results through various measures
to further improve the safety awareness of employees
86 Safety and Health
"},{"text":"Group Management Report Products Safety and Health Environment Human Resources Social Commitment Consolidated Financial Statements 87
Worldwide Safety Measures
In the year under review, ACTEGA Artística was one of the
first companies in Spain to receive ISO 45001:2018 certification,
which focuses primarily on prevention systems and
the implementation of a culture of continuous improvement
in occupational safety. This certification is an important
milestone within the SAFETY FIRST program, through which
ACTEGA Artística raises awareness of safe behavior and
procedures at both management and employee level.
The safety weeks and safety days successfully introduced
in previous years were again held at various locations
worldwide in the year under review. In addition to firmly established
events such as European Safety Week at all
ELANTAS Europe locations, the Safety and Health Day at
ALTANA and BYK in Wesel, or Celebration of National
Safety Day at ELANTAS Beck India, ACTEGA North America
launched a promising new safety campaign called What’s
Your Why? In this poster campaign, employees share their
personal reasons for accident-free work with their colleagues
and thus motivate them to engage in safe behavior.
The company’s suggestion scheme (CSS) is actively
used at seven German sites as an instrument for maintaining
and improving ALTANA’s safety culture. Employees submit-
ted around 800 ideas in the year under review, a large proportion
of which were suggestions for improvement in the
areas of occupational safety and environmental protection.
The implemented suggestions not only contribute to improving
ergonomic conditions and occupational safety, but
also lead to cost savings.
A Focus on Safety Communication
In order to continue to strengthen the employees’ understanding
of uniform safety in the future, the ALTANA Group
and the safety culture as a whole. In addition to the further
development and implementation of technical and organizational
measures and the detailed analysis of “near misses,”
behavior-based safety training enables staff to practice
safe behavior in every situation.
The SAFETY@ALTANA newsletter, which was successfully
launched in 2018, will continue to be published regularly,
but in an improved and more attractive format. It is
available to all employees via the ALTANA Intranet.
Accidents
with significant frequency and relevance are presented in
the ALTANA staff magazine together with strategies for their
prevention. In addition, all sites worldwide have established
their own safety organization, which is responsible among
others for complying with all local occupational safety reg-
ulations, for training and education measures, and for recording
and evaluating accidents and near misses.
Incidents in Detail
Based on the instructions for reporting on globally harmonized
process safety key figures in accordance with the
International Council of Chemical Associations (ICCA) and on
the definition provided by the German Chemical Industry
Association (VCI), we had a total of 18 significant incidents
in the year under review. A comparison with previous
years is not meaningful, as the criteria for reportable events
changed during the period under review.
16 of the incidents were chemical spills and the other
two were fires. In one of the cases there was minor release
of a chemical with soil contamination. The contaminated
soil was removed and disposed of properly. No employees
were injured in any of the events.
"},{"text":"relies above all on clear and direct communication. BYK
continues to work closely with the employer’s liability insurance
association of raw materials and the chemical industry
(BG RCI) on the topic of VISION ZERO. In the year under review,
the focus was on two issues: road safety and safety
in general. Various campaigns were carried out in the fall.
Among other things, employees at the logistics center in
Wesel-Emmelsum were able to experience the consequences
of an accident first hand in a truck rollover simulator. Furthermore,
the general safety in teams was emphasized. In
small groups, employees could discuss safety in their team
with their superiors and agree on individual rules for safety.
At the ACTEGA production sites in Germany, Brazil,
and France, so-called safety talks are held regularly during the
different shifts. As a consequence, employees become even
more aware of safety issues. New production employees
receive special training in safe behavior as part of their introductory
training. In addition, cooperation on the topic of
“Behavior-based safety culture” was continued with an
external partner at the ACTEGA site in Grevenbroich. In view
of the extremely positive experiences so far, similar coach-
ing sessions are planned at other sites.
These measures also make an important contribution to
accident prevention.
Health Protection
In the year under review, ALTANA again invested in improving
health protection, especially in protecting employees from
critical substances (e. g., dusts and VOCs). Among other things,
existing ventilation systems at ECKART in Wackersdorf and
at ACTEGA Artística were optimized, and the supply of raw
materials at ACTEGA Rhenacoat was fully automated.
To prevent musculoskeletal disorders, the company again
improved the ergonomics of workplaces in various areas
at many sites. At ECKART in Güntersthal and Pori, for example,
and at ACTEGA Foshan, loading and lifting equipment
for work with heavy loads was installed. Furthermore, ACTEGA
Artística adapted the manual supply of raw materials in
a production process such that employees are no longer
stressed by heavy loads.
Due to the consistently positive response, annual health
days have become a matter of course at many sites. Employees
have the opportunity, for example, to undergo medical
examinations and receive advice or to attend lectures
on healthy eating or stress management.
In addition, employees can benefit from a multifaceted
company sports, nutrition, fitness, and relaxation program,
which is available all year round at many sites.
88 Safety and Health
"},{"text":"Environment
Environmentally friendly management is a key component
steadily reduce the energy consumption at all sites and
in all areas. We also implement this objective in other
environmentally relevant areas, such as waste and the
consumption of drinking water.
90
90
91
92
92
of ALTANA’s corporate strategy. Our goal is to
Improvements in Environmental Performance
Progress in Climate Protection
Responsible Usage of the Resource Water
Further Waste Management Improvement
Emissions Further Reduced
"},{"text":"goods produced also show a positive trend (details can
be found in the online document “Facts and Figures on Sustainability
2019”).
The reasons for the improvements in the waste volume
balance include optimization of production processes and
reuse of byproducts.
ALTANA was able to improve both the absolute figures
and the key performance indicators for water consumption
in the reporting period. The consumption of drinking
water in 2019 was around 1,250,000 cubic meters (2018:
1,370,000 cubic meters). The resulting figure based on the
quantity of finished goods produced was 2.38 m³ / t (previous
year: 2.43 m³ / t). In relation to gross value added, the
figure was 1.34 l / € (previous year: 1.48 l / €).
In the period under review, the volume of finished goods
produced decreased to 527,000 tons (2018: 563,000
tons). This required 515,000 tons of raw materials, including
382,000 tons of fossil raw materials, 23,000 tons of renewable
raw materials, and 110,000 tons of non-fossil and
non-renewable raw materials. In addition, 48,000 tons
of water were used as raw material. Detailed information on
ALTANA’s consumption of resources and energy (differen-
tiated by electricity, natural gas, and oil) as well as environmental
key performance indicators can be found in the
online document at www.altana.com / facts_figures_sustainability_
2019.
In 2019, 89 % of the ALTANA Group’s production sites
fulfilled the ISO 14001 standard. In addition, the energy
management systems of ten sites are certified in accordance
with ISO 50001.
Progress in Climate Protection
During the period under review, numerous projects were
carried out to reduce energy consumption and thus cut CO²
emissions. One focus this year was on the optimization of
90 Environment
Improvements in Environmental Performance
The ALTANA Group measures progress in the area of environmental
protection using specific key performance indica-
tors. In addition to the absolute values, the figures are set in
relation to the quantity of produced finished goods and
the gross value added. ALTANA sets annual upper limits for
CO² emissions, water consumption, and waste quantities
in relation to gross value added. The development of these
indicators is published in the online document “Facts and
Figures on Sustainability 2019.”
In the 2019 fiscal year, the ALTANA Group’s energy con-
sumption amounted to around 676,000 megawatt-hours
compared to 708,000 megawatt-hours in the previous year.
In terms of gross value added, the value changed from
0.76 kWh / € to 0.73 kWh / €. As regards the quantity of produced
finished goods, the figure of 1.28 MWh / t was
slightly above the previous year’s figure of 1.23 MWh / t. This
is mainly due to the lower volume of produced finished
goods (2019: 527,000 tons; 2018: 563,000 tons). CO² emis-
sions decreased from 193,000 tons in 2018 to 182,000
tons in the year under review. The specific indicators remained
roughly at the previous year’s level due to the reduction
in gross value added and the quantity produced. This was
achieved by selecting new electricity suppliers. In 2019,
almost all of ALTANA’s German sites obtained around half
of their electricity from renewable energy sources. This
corresponded to 254 g CO² / kWh. In addition, projects to
improve energy efficiency were implemented at various
locations (see following pages).
In 2019, the ALTANA Group reduced the volume of haz-
ardous waste it produced from 18,800 tons in the previous
year to 18,100 tons. The key figure related to gross value
added also improved, from 20.27 g / € to 19.42 g / €. The
volume of non-hazardous waste also decreased in absolute
terms, from around 11,400 to 9,600 tons. The key performance
indicators relating to gross value added and finished
"},{"text":"Group Management Report Products Safety and Health Environment Human Resources Social Commitment Consolidated Financial Statements 91
cooling systems, at the ACTEGA location in Grevenbroich,
among others. The company thus achieved several improvements.
Among other things, the products can be cooled
to significantly lower temperatures, which means that less
solvent evaporates. It also prevents gelling of some sensitive
products. This allows the products to be manufactured
more quickly.
ECKART commissioned a new chiller with a free cooling
function at its Güntersthal site. This saves approximately
29 tons of CO² per year. In addition, the division further optimized
the cooling supply in some production sites. This led
to a reduction of approximately 37 tons of CO².
In other projects, energy efficiency was improved by
replacing various plant components. For example, ELANTAS
Europe was able to reduce CO² emissions by a total of
around 60 tons a year by installing highly efficient electric
motors at all of its Italian sites. ECKART also installed elec-
tric motors with improved efficiency at its Güntersthal and
Wackersdorf sites. As a result of this and the optimization
of the processes, a total of approximately 75 tons of CO² was
saved.
To improve the heat supply, new boilers and ventilation
components were installed at our U.S. locations in Paines-
ville (ECKART) and St. Louis (ELANTAS), among others.
ECKART replaced the entire heating and ventilation system in
Schererville. ACTEGA installed new motors for indoor air
in Grevenbroich. These measures also led to a reduction in
CO² emissions.
The optimization of the compressed air supply that was
already initiated in previous years, for example by replac-
ing compressors or reducing the pressure in the piping system,
was continued in the year under review. These projects at
the Bremen (ACTEGA), Schererville (ECKART), as well as the
Cerquilho and St. Louis (both ELANTAS) sites resulted in
total CO² savings of 167 tons.
Responsible Usage of the Resource Water
Water plays an important role in many of the ALTANA Group’s
production processes, and so the specialty chemicals
group is making various efforts to use this resource sparingly.
Water is used in the chemical industry as a raw material,
as a cleaning agent, and as a coolant. ALTANA aims to keep
its water consumption as low as possible and to use it as
a cooling medium in closed loop systems. At ELANTAS’ site
in Olean (New York), water management in production
was optimized by installing new valves in the cooling water
loop. As a result, some 6,800 m³ of water can be saved
each year.
Environmental performance indicators ALTANA
2016 2017 2018 2019
CO² (Scope 1 + Scope 2) (kg / € ) 0.24 0.21 0.21 0.20
Drinking water (l / € ) 1.52 1.36 1.48 1.34
Hazardous waste (g / € ) 23.33 21.24 20.27 19.42
Hazardous waste for disposal (g / € ) 7.04 4.20 3.73 3.23
Non-hazardous waste (g / € ) 10.49 12.89 12.26 10.26
Non-hazardous waste for disposal (g / € ) 5.16 5.62 5.67 4.29
The key performance indicators are calculated from the absolute values related to the gross value added.
Scope 1: direct emissions; Scope 2: indirect emissions
"},{"text":"Another way of using the valuable resource water efficiently
is to recycle it for other processes with the aid of so-called
water ring pumps. ACTEGA in Foshan (used as cooling water;
drinking water savings: 450 m³) and ECKART in Pori (used to
produce deionized water; drinking water savings: 16,000 m³)
deployed this procedure.
In the previous year, we already reported on a pilot
project (“Zero Discharge”) at the ELANTAS site in Ankleshwar,
India. In 2019, this project was advanced further. Through
these and other measures, the amount of drinking water consumed
could be reduced by approximately 5,000 m³.
Further Waste Management Improvement
Chemical processes generate waste and wastewater, which
mainly affects production sites. ALTANA aims to avoid or
reduce wastewater and waste and thus minimize the negative
effects on people and the environment, among other
things by using suitable raw materials and cleaning agents.
Through the use of an alternative solvent, for example,
ECKART reduced hazardous waste at its Louisville site by 60
tons per year.
By optimizing individual manufacturing steps and cleaning
processes, for example, the amount of waste at the
Güntersthal (ECKART) and Cerquilho (ELANTAS) sites was
reduced by more than 30 tons.
The ECKART site in Painesville also contributed to the
reduction of waste volumes by means of several measures.
The installation of new mixers led to an improvement in
the manufacturing processes. In addition, operation of this
equipment is more ergonomic and safer than before.
Emissions Further Reduced
In addition to the greenhouse gas CO², which mainly arises
during the combustion of fossil fuels, volatile organic compounds
(VOCs) also contribute to emissions. ALTANA aims to
continue keeping these emissions as low as possible in the
future. To achieve this goal, various technical options are available
at many sites. Further measures to reduce emissions
were implemented in the year under review.
For example, the installation of new pumps with magnetic
coupling at the ELANTAS site in Ascoli Piceno eliminated
diffuse emission sources.
ACTEGA achieved a significant reduction of emissions in
production by installing new sealing rings on mixing vessels
at its Lincolnton site.
92 Environment
"},{"text":"Human Resources
ALTANA gears its activities to long-term and sustainable
growth. We can only achieve this goal together with
our competent and committed employees. We therefore
promote the professional development of our staff,
prepare them for leadership positions, and enable them to
participate in the company’s success. We put particular
emphasis on the recruitment of young talent, specialists,
and managers.
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95
Our Employees: Our Most Important Asset
Human Resource Development and Talent Management
Women in Leadership Positions
Recruitment
"},{"text":"Our Employees: Our Most Important Asset
ALTANA is a highly innovative globally leading specialty
chemicals company. Of overriding importance for the company’s
success is our most important resource, our employees,
who are motivated and dedicated and have above-average
qualifications. They are committed to the respectful
corporate culture defined in ALTANA’s Guiding Principles,
which is informed by our four central values: appreciation,
openness, empowerment to act, and trust. As an attractive
employer, we offer our some 6,500 employees around the
world individualized further training opportunities and promote
their professional development in a targeted manner.
In order to do justice to advancing digitalization, in the year
under review we included further education and training
measures in the ALTANA further education and training catalog
that train employees in new digital applications. In
addition, in the course of the HR transformation project and
the associated introduction of the human resource management
tool SuccessFactors, employees can increasingly control
their own profile digitally on their own responsibility
and independently.
Human Resource Development and Talent
Management
To ensure that the company remains highly competitive in
globalized sales markets, a primary focus of the ALTANA
Group’s human resource strategy is to secure young talent.
Special emphasis is placed on consistent and global pro-
motion of internal talent. We consider the continuous optimization
of human resource development programs, close
monitoring of talent, and the identification of development
measures and perspectives to be key factors in this regard.
To make human resource development at ALTANA more transparent,
we developed the so-called Talent Cycle in the
2019 reporting year. This annually recurring process includes
identification and selection of talent for internal succes-
sions, as well as the selection of participants for development
programs. The focus is on the progress dialogue, which
was revised in 2019. It includes a comprehensive development
plan, as well as an assessment of each employee’s skills by
a manager and feedback from the employee to the manager.
Employees and managers are encouraged to exchange in-
formation at eye level and jointly define the employee’s development
path in open dialogue. Constructive feedback and
support are the top priorities. The basis for the new progress
dialogue, the global introduction of which will be complet-
ed by the beginning of 2021, is the competence model that
was already introduced in 2018. In order to focus on the
internal exchange and global networking of our managers, we
support our employees’ development through internal personnel
development programs. In the 2019 reporting year,
one of our international Management Development Programs
and a regional development program in Europe were
successfully completed. Most of the participating manag-
ers took on more responsibility during or after the programs,
either globally or cross-divisionally. This illustrates the success
of the programs as an important component of talent
management. In the year under review, programs for Europe
and the Americas were launched. The Advanced Leader-
ship Program (ALP), first launched in 2018, was completed
at the beginning of this year (2020).
Women in Leadership Positions
Diversity in leadership positions is an important goal of our
Keep Changing Agenda. At the end of 2019, 29.8 percent of
our employees in Germany and 21.9 percent of our managers
there were women. ALTANA’s medium- to long-term goal
is to increase the share of women in leadership positions to
the percentage of women in the company’s total workforce.
94 Human Resources
"},{"text":"Group Management Report Products Safety and Health Environment Human Resources Social Commitment Consolidated Financial Statements 95
The initiative LEADING WOMEN @ ALTANA is providing important
impetus. It includes a mentoring program for women
that prepares women who have potential for a possible
leadership role and accompanies women who have taken on
a leadership role for the first time. The mentoring program
makes an important contribution toward increasing the share
of women in leadership positions.
To this end, teams consisting of a mentee and a mentor
meet regularly over a period of twelve months. The
mentor shares his or her knowledge and experience with the
mentee. On account of the success, ALTANA continued
the mentoring project in 2019 with 28 new tandems across
its sites in Germany. At present, the company is examining
whether to extend the program to other European countries.
Recruitment
Our recruitment activities received a number of awards in
2019. ALTANA received top results regarding online recruiting
channels from BEST RECRUITERS and the Potentialpark
study. In addition, we again received the “MINT-Minded
Company” for 2019. This award is presented by audimax
MEDIEN GmbH in cooperation with the MINT Zukunft schaffen
initiative. The initiative honors companies that provide
special support to young talent in the fields of mathematics,
informatics, natural sciences, and technology.
For the recruitment of young talent, the ALTANA Group
has relied for years on cooperation with institutes of higher
education. Particularly noteworthy is its close cooperation
with the Young Chemists Forum (JCF), a scientific association
for chemistry students and doctoral candidates. In the
year under review, ALTANA was in close contact with
various regional forums of the JCF, which organized various
events including seminars, excursions, job exchanges, and
conferences lasting several days. ALTANA also took part in the
JCF Spring Symposium in Bremen attended by more than
300 participants from the university chemistry landscape. In
an international context, ALTANA participated in 2019 for
the first time in the ChemSkillDays in Salzburg, organized by
young chemists from Austria and Germany. At this event,
we presented ourselves to around 40 students at a workshop
on sustainability and project management.
For the tenth time, in the year under review ALTANA
supported students majoring in MINT fields and in human
resource management with a Deutschlandstipendium. The
27 recipients not only received financial support, but could
also personally experience ALTANA within the framework
of various events, enable themselves to be considered for in-
ternships and degree theses, take advantage of mentoring
offers or take part in specialist seminars.
As part of the ALTANA Group’s web design project,
the ALTANA career website was revised and made more customer
oriented, user-friendly, and modern.
"},{"text":"Social Commitment
As a good corporate citizen, ALTANA supports and
sponsors social projects focusing on education, science,
and research. To strengthen our local environments
and to be a good neighbor, we especially promote initiatives
near our sites in Germany and abroad.
Social Commitment
Educational Coaching of Elementary Schoolchildren
Junior Researchers Visit ALTANA
Youth Startups Competition
Social Commitment and Donations
97
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"},{"text":"Group Management Report Products Safety and Health Environment Human Resources Social Commitment Consolidated Financial Statements 97
Social Commitment
The natural sciences, mathematics, informatics, and technology
are among the drivers of economic development and
social progress around the world. In this context, ALTANA
wants to help introduce young people to these disciplines at
an early stage and to kindle their enthusiasm for them. In
addition, ALTANA is involved in a number of selected social
projects. In cooperation with experienced partners from
the education sector, we support concrete projects, often in
the immediate proximity of our sites. To maximize lasting
impact, the company usually promotes these projects over a
period of several years.
Educational Coaching of Elementary
Schoolchildren
ALTANA has supported the educational coaching project at
GGS Innenstadt, the largest public elementary school in
Wesel, for six years now. The project was initiated by the City
of Wesel and implemented by the Klausenhof Academy
in close cooperation with GGS Innenstadt. The main aim of
the coaching is to promote elementary schoolchildren
and to achieve equal opportunity for children with a migration
background and from socially deprived backgrounds.
The project also supports the development of children with
special talents.
As in the previous years, ALTANA financed the personnel
and material costs for a socio-educational expert at the
Klausenhof Academy. The expert assigns “personal mentors”
to each child, trains the mentors, and coordinates their
work. A total of 46 children have been supported since the
project began in 2014. Currently, 18 volunteer mentors
are taking part. They support and challenge the children in
their personal development according to their interests
and abilities. Some of the mentors now even look after two
children. The support focuses on extracurricular activities such
as library visits, music, and sports.
Junior Researchers Visit ALTANA
Furthering children’s and adolescents’ scientific knowledge
has a tradition at ALTANA. Employees of BYK-Chemie at
our Wesel site have worked as school ambassadors for many
years. ALTANA is a network partner of the Germany-wide
foundation House of Junior Researchers. For a number of
years now, it has accompanied two elementary schools
and one daycare center in Wesel. The aim of the initiative,
which is sponsored by the German Federal Government,
is to get children interested in science. The concept includes
special research days that take place in cooperation with
school ambassadors at the respective school or daycare center.
In 2019, air and water were the main topics of the
research days. In April, the junior researchers presented their
results to parents, teachers, and employees at the traditional
closing event held at the ALTANA conference center.
In the context of various events, employees at other
sites also give young people insight into the world of science,
conduct experiments together with them, and introduce
them to scientific training and career possibilities.
Youth Startups Competition
ALTANA supports the online competition “Jugend gründet”
(Youth Startups), sponsored by the German Federal Government,
and in 2019 offered a special prize in chemistry for
the fifth time in a row. In the national finals in 2019, a team
of students from Lingen, Germany, won the prize for a
sustainable business idea – a perfected mini biogas system
for the restaurant trade which produces electricity and
heat and with which at the same time organic waste can be
"},{"text":"disposed of. With the idea, they want to promote ecological
thinking in society and ensure that everyone can contribute
to a better future. The award was connected with a fourday
trip to the East Coast of the U.S., where the students
were able to visit one of the ALTANA Group’s largest research
and production sites at BYK USA in Wallingford in the fall
of 2019 and also take a trip to New York City.
Social Commitment and Donations
BYK USA is committed to sustainability. Its various sites support
several social projects in their respective communities.
They focus on social, cultural, and ecological areas. An example
is the Chester site, which regularly supports the local
fire department. Among the projects that BYK USA supports
as part of its commitment to sustainability is the Toyland
project, in which toys are collected for children from needy
families. In Earth City, the company also collects toys in
support of the Toys for Tots organization.
BYK USA in Wallingford participates in an annual fundraising
race for breast cancer research and has also sponsored
several projects for the benefit of cancer patients and
a local rehab clinic. In an initiative launched by the com-
pany each year, all proceeds go to a foundation for children
with cancer. During the Christmas season, the Adopt-A-
Family program enables employees to grant a wish on a wish
list to needy families. At the annual Christmas party, donation
boxes are set up and employees collect clothes for the
food pantry and funding needed by the local animal shelter.
In May 2019, ELANTAS PDG took part in a blood donation
campaign launched by the Mississippi Valley Regional
Blood Center, which helped provide care to 70 patients at
local hospitals. For many years, ELANTAS PDG has been
supporting local social projects and at the same time streng-
thening its employees’ personal commitment to sustainability
(see also page 42 ff.). One example is our renewed
participation in the traditional World Food Day, where employees
pack around 300 meals for the needy each year.
As part of a fund-raising campaign by the St. Louis Area Food-
bank in the spring of 2019, ELANTAS PDG was able to
fill four containers with non-perishable food, thus providing
several hundred meals for needy people.
ELANTAS Beck India is supporting several projects over
a longer period of time that focus on education, health,
and hygiene. Thanks to the financial support, schoolrooms
in two villages in the Indian state of Gujarat have been
renovated, a water treatment plant has been installed, and
new toilet facilities built. In the outskirts of Pune, where
ELANTAS Beck India has its largest site, three rural boarding
schools that obtain their drinking water from borewells
were equipped with water treatment plants. Many children
who grow up in slum areas lack suitable premises for learn-
ing. In the aid organization Surajya Prakalpa, ELANTAS Beck
India has found a partner that has set up schoolrooms in
four poor areas of Pune where children can learn in peace.
In the context of the annual ECKART Christmas donation
campaign “Donations Instead of Gifts,” a total of around
20,000 euros were made available. Two children’s aid
organizations and the Christmas campaign “Joy for All” of
the Nürnberger Nachrichten newspaper each received
6,666 euros.
98 Social Commitment
"},{"text":"Consolidated Financial Statements
(condensed version)
100
101
102
104
106
Management Board Responsibility Statement
ALTANA Group Consolidated Income Statement
ALTANA Group Consolidated Statement of Financial Position
ALTANA Group Consolidated Statement of Cash Flows
Reference to the Consolidated Financial Statements
"},{"text":"100 Management Board Responsibility Statement I ALTANA Group Consolidated Income Statement
Management Board Responsibility Statement
The consolidated financial statements of the annual report have been prepared by the
Management Board of ALTANA AG, which is responsible for the completeness and accuracy
of the information contained therein.
The consolidated financial statements have been prepared in accordance with the International
Financial Reporting Standards (IFRS), as endorsed by the EU and in accordance
with the requirements of German commercial law pursuant to section 315e of the German
Commercial Code (HGB).
The information contained in the consolidated financial statements and the Group
Management Report is based on the information reported, in accordance with consistent
guidelines in force throughout the Group by the companies included in the consolidated
financial statements. The integrity of the reporting process is safeguarded by effective internal
control systems established at these companies under the direction of the Manage-
ment Board. This assures a true and fair view of the performance and results of the Group and
enables the Management Board to recognize potential investment risks and negative
developments at an early stage and take appropriate countermeasures.
By resolution of the Annual General Meeting, the Chairman of the Audit Committee of
the Supervisory Board appointed PricewaterhouseCoopers GmbH Wirtschaftsprüfungsgesell-
schaft as independent auditors of the consolidated financial statements. The auditors issued
an unqualified auditors’ report on the complete consolidated financial statements and the
Group management report. The consolidated financial statements, the Group Manage-
ment Report and the auditors’ report have been made available to the Supervisory Board for
detailed discussion. The report of the Supervisory Board is contained on pages 16 – 19 of
the Corporate Report 2019.
To the best of our knowledge and in accordance with the applicable reporting principles the
consolidated financial statements give a true and fair view of the net assets, financial position,
and results of operations of the Group and the Group Management Report includes a
fair review of the development and performance of the business and the position of the
Group, together with a description of the principal opportunities and risks associated with
the expected development of the Group.
Wesel, Germany, February 26, 2020
ALTANA AG
The Management Board
Martin Babilas\t Stefan Genten\t Dr. Christoph Schlünken
"},{"text":"Group Management Report Products Safety and Health Environment Human Resources Social Commitment Consolidated Financial Statements 101
ALTANA Group Consolidated Income Statement
Notes 2018 2019
in € thousand
Net sales 4 2,307,399 2,248,943
Cost of sales 5 (1,463,627) (1,424,750)
Gross profit 843,772 824,193
Selling and distribution expenses 6 (291,228) (290,285)
Research and development expenses (154,127) (165,572)
General administration expenses (108,571) (105,090)
Other operating income 7 16,737 14,250
Other operating expenses 8 (10,825) (15,011)
Operating income (EBIT) 295,758 262,485
Financial income 9 4,898 19,871
Financial expenses 10 (12,110) (11,983)
Financial result (7,212) 7,888
Income from at equity accounted investments (24,460) (39,090)
Income before income taxes (EBT) 264,086 231,283
Income taxes 11 (77,097) (62,234)
Net income (EAT) 186,989 169,049
thereof attributable to non-controlling interests 1,975 1,620
thereof attributable to the shareholder of ALTANA AG 185,014 167,429
"},{"text":"102 ALTANA Group Consolidated Statement of Financial Position
ALTANA Group Consolidated Statement of Financial Position
Assets Notes Dec. 31, 2018 Dec. 31, 2019
in € thousand
Intangible assets 13 1,044,217 1,023,882
Property, plant and equipment 14 868,162 970,837
Long-term investments 15 22,323 45,732
Investments in at equity accounted companies 16 117,869 138,316
Deferred tax assets 11 20,496 21,980
Other non-current assets 21 10,667 10,900
Total non-current assets 2,083,734 2,211,647
Inventories 17 373,027 348,847
Trade accounts receivable 18 384,180 380,644
Income tax refunds 12,832 15,361
Other current assets 21 103,836 97,521
Marketable securities 19 21,907 19,961
Short-term financial assets 20 2,690 4,768
Cash and cash equivalents 239,652 264,556
Total current assets 1,138,124 1,131,658
Total assets 3,221,858 3,343,305
"},{"text":"Group Management Report Products Safety and Health Environment Human Resources Social Commitment Consolidated Financial Statements 103
Liabilities, provisions and shareholders’ equity Notes Dec. 31, 2018 Dec. 31, 2019
in € thousand
Share capital ¹ 136,098 136,098
Additional paid-in capital 151,276 151,276
Retained earnings 1,974,331 2,071,165
Accumulated other comprehensive income 71,359 107,907
Equity attributable to the shareholder of ALTANA AG 2,333,064 2,466,446
Non-controlling interests 11,553 12,960
Shareholders’ equity 22 2,344,617 2,479,406
Non-current debt 24 62,959 50,793
Employee benefit obligations 25 220,429 255,974
Other non-current provisions 26 20,331 20,894
Deferred tax liabilities 11 85,462 68,721
Other non-current liabilities 27 27,862 28,941
Total non-current liabilities 417,043 425,323
Current debt 24 82,641 62,489
Trade accounts payable 195,351 182,457
Current accrued income taxes 41,212 42,513
Other current provisions 26 87,479 93,592
Other current liabilities 27 53,515 57,525
Total current liabilities 460,198 438,576
Total liabilities, provisions and shareholders’ equity 3,221,858 3,343,305
¹ Share capital consists of 136,097,896 no-par value shares.
"},{"text":"104 ALTANA Group Consolidated Statement of Cash Flows
ALTANA Group Consolidated Statement of Cash Flows
Notes 2018 2019
in € thousand
Net income (EAT) 186,989 169,049
Depreciation and amortization of intangible assets and property,
plant and equipment 13, 14 134,842 149,241
Impairment of intangible assets and property, plant and equipment 13, 14 4,068
Change in fair value of financial assets and securities 10 (27) (2,851)
Net result from the disposal of intangible assets and property,
plant and equipment 7, 8 (1,414) 433
Net result from the disposal of long-term investments and
marketable securities 9 (55) 17
Change in inventories 17 (40,369) 29,572
Change in trade accounts receivable 18 (11,379) 6,265
Change in income taxes 11 1,723 (12,341)
Change in provisions 25, 26 (14,411) 12,058
Change in trade accounts payable 2,367 (14,156)
Change in other assets and other liabilities 21, 27 11,804 9,561
Other 16 26,165 35,425
Cash flow from operating activities 296,235 386,341
Capital expenditure on intangible assets and property,
plant and equipment 13, 14 (186,988) (157,180)
Proceeds from the disposal of intangible assets and property,
plant and equipment 13, 14 5,843 798
Acquisitions, net of cash acquired 3 (3,126) (8,587)
Purchase of long-term investment and investments in at equity
companies 15, 16 (54,901) (47,569)
Proceeds from the disposal of long-term investments 15 54 26
Payments on long-term loans (23,010) (16,000)
Proceeds from long-term loans 71,014
Purchase of marketable securities 19 (31,339) (42,500)
Proceeds from the disposal of marketable securities 9, 10 27,462 44,296
Change in short-term financial assets (700) (2,131)
Cash flow from investing activities (195,691) (228,847)
"},{"text":"Group Management Report Products Safety and Health Environment Human Resources Social Commitment Consolidated Financial Statements 105
Notes 2018 2019
in € thousand
Dividends paid (80,111) (50,113)
Proceeds from issuance of long-term debt 24 8,383 3,924
Repayment of long-term debt 24 (67)
Net increase / decrease in short-term debt 24 (64,144) (88,455)
Cash flow from financing activities (135,939) (134,644)
Effect of exchange rate changes (624) 2,054
Change in cash and cash equivalents (36,019) 24,904
Cash and cash equivalents as of January 1 2 275,671 239,652
Cash and cash equivalents as of December 31 2 239,652 264,556
Additional information on cash flows included in the cash flows
from operating activities
Income taxes paid (80,603) (86,590)
Interest paid (3,916) (3,621)
Income taxes received 5,966 16,365
Interest received 2,226 10,390
Dividends received 962 809
"},{"text":"106 Reference to the Consolidated Financial Statements
Reference to the Consolidated Financial Statements
The consolidated financial statement to the Corporate Report 2019 are provided online at
www.altana.com / consolidated_financial_statements_2019
Consolidated Financial Statements
Management Board Responsibility Statement
Independent Auditors’ Report
ALTANA Group Consolidated Income Statement
ALTANA Group Consolidated Statement of Comprehensive Income
ALTANA Group Consolidated Statement of Financial Position
ALTANA Group Consolidated Statement of Changes in Shareholders’ Equity
ALTANA Group Consolidated Statement of Cash Flows
Notes to Consolidated Financial Statements
\t 1.\tBasis of Presentation
\t 2.\tSignificant Accounting Policies
\t 3.\tBusiness Combinations and Disposals
\t 4.\tNet Sales
\t 5.\tCost of Sales
\t 6.\tSelling and Distribution Expenses
\t 7.\tOther Operating Income
\t 8.\tOther Operating Expenses
\t 9.\tFinancial Income
\t 10.\tFinancial Expenses
\t 11.\tIncome Taxes
\t 12.\tOther Information on the Income Statement
\t 13.\tIntangible Assets
\t 14.\tProperty, Plant and Equipment
\t 15.\tLong-term Investments
\t 16.\tInvestments in at Equity Accounted Companies
\t 17.\tInventories
\t 18.\tTrade Accounts Receivable
\t 19.\tMarketable Securities
\t 20.\tShort-term Financial Assets
\t 21.\tOther Assets
\t 22.\tShareholders’ Equity
\t 23.\tEmployee Incentive Plans
\t 24.\tDebt
\t 25.\tEmployee Benefit Obligations
\t 26.\tOther Provisions
\t 27.\t Other Liabilities
\t 28.\tAdditional Disclosures for Financial Instruments
\t 29.\tCommitments and Contingencies
\t 30.\tRelated Party Transactions
\t 31.\tCompensation of the Supervisory Board and Management Board
\t 32.\tFees Paid to the Auditor
\t 33.\tSubsequent Events
\t 34.\tAdditional Information
Supervisory Board of ALTANA AG
Supervisory Board Committees
Management Board of ALTANA AG
"},{"text":"108
110
Multi-Year Overview
Global Compact: Communication on Progress (COP)
"},{"text":"108 Multi-Year Overview
Multi-Year Overview
Key figures at a glance
2010 2011 2012 2013 in € million
BYK 541.2 581.9 618.4 691.5 ECKART 356.6 346.8 340.5 334.6 ELANTAS 377.4 390.9 412.5 414.6 ACTEGA 260.2 297.0 333.9 324.7 2010 2011 2012 2013 in € million
Sales 1,535.4 1,616.7 1,705.3 1,765.4 Earnings before interest, taxes, depreciation
and amortization (EBITDA) 314.1 308.0 323.2 335.7 EBITDA margin 20.5 % 19.1 % 19.0 % 19.0 % Operating income (EBIT) 230.2 217.0 226.9 229.1 EBIT margin 15.0 % 13.4 % 13.3 % 13.0 % Earnings before taxes (EBT) 218.2 207.7 217.2 212.6 EBT margin 14.2 % 12.8 % 12.7 % 12.0 % Net income (EAT) 152.3 147.5 154.7 151.6 EAT margin 9.9 % 9.1 % 9.1 % 8.6 % Research and development expenses 82.0 87.7 102.3 109.4 Capital expenditure on intangible assets,
property, plant and equipment 73.8 93.5 89.8 94.3 Cash flow from operating activities 238.6 170.0 274.5 258.8 Return on Capital Employed (ROCE) 12.2 % 11.2 % 10.8 % 9.9 % ALTANA Value Added (AVA) 64.2 53.2 50.0 38.7 Total assets (Dec. 31) 1,943.6 2,001.9 2,121.3 2,546.0 Shareholders’ equity (Dec. 31) 1,364.2 1,417.1 1,498.2 1,565.6 Net debt (-) / Net financial assets (+) ¹ (Dec. 31) 79.7 ( 26.8) 68.2 ( 303.6) Headcount (Dec. 31) 4,937 5,313 5,363 5,741 ¹ Comprises cash and cash equivalents, current financial assets, marketable securities, loans granted, debt, and employee benefit obligations.
Sales by division
Sales by region
2010 2011 2012 2013 in € million
Europe 683.7 740.8 751.7 745.2 thereof Germany 234.5 258.5 266.1 262.4 Americas 361.5 373.3 412.0 438.4 thereof U.S. 242.0 243.2 268.4 289.5 Asia 439.0 447.7 509.6 547.4 thereof China 224.2 228.5 252.5 287.8 Other regions 51.2 54.9 31.9 34.3 Change in country allocation as of 2012
"},{"text":"Multi-Year Overview 109
2014 2015 2016 2017 2018 2019
1,952.3 2,059.3 2,075.3 2,247.0 2,307.4 2,248.9
397.4 390.9 453.0 470.0 430.6 415.8
20.4 % 19.0 % 21.8 % 20.9 % 18.7 % 18.5 %
267.7 251.3 328.7 335.9 295.8 262.5
13.7 % 12.2 % 15.8 % 14.9 % 12.8 % 11.7 %
251.8 227.8 299.8 306.0 264.1 231.3
12.9 % 11.1 % 14.4 % 13.6 % 11.4 % 10.3 %
179.2 158.0 210.1 234.6 187.0 169.0
9.2 % 7.7 % 10.1 % 10.4 % 8.1 % 7.5 %
113.9 128.1 129.3 142.5 154.1 165.6
90.4 85.6 122.1 188.0 187.0 157.2
298.2 346.1 376.7 302.3 296.2 386.3
10.3 % 10.1 % 11.6 % 11.3 % 9.4 % 8.8 %
51.9 49.2 83.3 84.0 37.6 21.6
2,756.2 2,964.5 3,053.9 3,147.7 3,221.9 3,343.3
1,745.5 1,935.6 2,082.2 2,214.2 2,344.6 2,479.4
( 280.1) ( 114.2 ) 25.7 ( 78.0) ( 95.6) ( 57.7)
6,064 6,096 5,967 6,186 6,428 6,476
2014 2015 2016 2017 2018 2019
856.7 870.0 909.1 1,030.4 1,065.6 1,040.6
332.2 349.7 361.9 385.3 382.6 356.2
431.2 463.2 452.1 488.7 506.6 494.5
332.1 376.4 352.2 342.6 352.6 357.7
2014 2015 2016 2017 2018 2019
795.1 795.6 798.6 852.3 875.0 858.0
276.7 269.8 263.2 275.7 273.4 259.1
527.1 607.1 587.2 623.6 624.4 620.6
365.0 416.1 398.8 436.3 434.8 427.6
593.0 618.9 652.3 733.5 769.4 731.8
309.8 315.6 336.0 399.0 421.2 388.5
37.0 37.7 37.2 37.6 38.6 38.6
"},{"text":"110 Global Compact: Communication on Progress (COP)
Global Compact: Communication on Progress (COP)
By participating in the UN initiative Global Compact, we commit to respecting human
rights, creating socially compatible working conditions, promoting environmental protection,
and fighting corruption.
Principle Page Measure taken
Human Rights
Principle 1
Businesses should support and
respect the protection of internationally
proclaimed human rights
8 – 10, 12 – 13,
94 – 95
FFS ¹, pp. 9, 27 – 29
Sustainable Development Goals (SDG 8),
ALTANA’s Guiding Principles
and leadership guidelines,
Compliance Management System,
women in leadership positions
Principle 2
Make sure that they are not complicit
in human rights abuses
7, 12 – 13
FFS ¹, pp. 23 – 24,
27 – 29
Code of Conduct,
sustainability assessments,
search for suppliers, supplier agreements
Labor
Principle 3
Businesses should uphold the freedom of
association and the effective recognition of
the right to collective bargaining
12 – 13
FFS ¹, pp. 27 – 29
Compliance Management System,
Corporate guideline HR
Principle 4
The elimination of all forms of forced and
compulsory labor
12 – 13
FFS ¹, pp. 27 – 30
Compliance Management System
Principle 5
The abolition of child labor
7, 12 – 13, 97 – 98
FFS ¹, pp. 23 – 24, 29
sustainability assessments,
Compliance Management System,
support of education initiatives
Principle 6
The elimination of discrimination in respect
of employment and occupation
7 – 10, 12 – 13
FFS ¹, pp. 27 – 30
Sustainable Development Goals (SDG 5),
Compliance Management System, training,
sustainability assessments and audits, surveys
Environment
Principle 7
Businesses should support a precautionary
approach to environmental challenges
8 – 10, 82 – 84,
90 – 92
FFS ¹, pp. 2 – 7,
13 – 15
Sustainable Development Goals (SDG 13),
sustainable product development,
energy and environmental management
systems, environmental key perfor-
mance indicators system with targets,
energy efficiency analyses
Principle 8
Undertake initiatives to promote greater
environmental responsibility
8 – 10, 82 – 84,
90 – 92
FFS ¹, pp. 2 – 7,
17 – 23
Sustainable Development Goals (SDG 13),
sustainable product development,
process optimizations,
capital expenditure, environmental key
performance indicators system with targets
Principle 9
Encourage the development and diffusion of
environmentally friendly technologies
8 – 10, 82 – 84
FFS ¹, pp. 31 – 32
Sustainable Development Goals (SDG 9),
product and technology innovations,
alternatives to critical materials
Anti-Corruption
Principle 10
Businesses should work against corruption in
all its forms, including extortion and bribery
7, 12 – 13
FFS ¹, pp. 27 – 30
Code of Conduct, Compliance
Management System, training and audits
¹ Facts and Figures on Sustainability 2019 (Online document)
"},{"text":"Contact
Corporate Communications
Tel + 49 281 670 - 10900
Fax + 49 281 670 - 10999
press@altana.com
Credits
U.S.
BYK USA Inc.,
Wallingford, CT
100 %
BYK Gardner USA,
Columbia, MD
100 %
ECKART America Corp.,
Painesville, OH
100 %
ELANTAS PDG Inc.,
St. Louis, MO
100 %
ACTEGA North America Inc.,
Cinnaminson, NJ
100 %
ACTEGA North America
Technologies Inc.,
East Providence, RI
100 %
ACTEGA Management Services Inc.,
Schererville, IN
100 %
Publisher
ALTANA AG
Abelstr. 43, 46483 Wesel, Germany
Tel + 49 281 670 - 8
Fax + 49 281 670 - 10999
info@altana.com
www.altana.com
ECKART de México Industrias,
S. de R.L. de C.V.,
Cuautitlán Izcalli (MEX)
100 %
Design
Heisters & Partner
Corporate & Brand Communication, Mainz
Photography
Robert Brembeck, Munich (pp. 2, 20 – 29, 34,
36 – 41)
Giuseppe Chiucchiù, Montecarotto, ITA
(pp. 35, 37)
iStock (pp. 43, 45)
Rolf Ringwald, St. Louis, USA (pp. 21, 42, 44,
45)
Grischa Rüschendorf, Hong Kong, CHN (p. 40)
Martin Schmüdderich, Gelsenkirchen (p. 17)
Robert Seale, Houston, USA (pp. 20, 30 – 33)
ALTANA worldwide
ALTANA worldwide
as of December 31, 2019 South America
ACTEGA do Brasil Tintas
e Vernizes Ltda.,
São Paulo (BRA)
100 %
ACTEGA Terra Chile Ltda.,
Santiago de Chile (CHL)
100 %
Europe
BYK Additives Ltd.,
Widnes (GBR)
100 %
BYK Netherlands B.V.,
Deventer (NLD)
100 %
ECKART Benelux B.V.,
Uden (NLD)
100 %
ECKART France SAS,
Saint-Ouen (FRA)
100 %
ECKART Italia Srl.
a Socio unico,
Rivanazzano (ITA)
100 %
ECKART Pigments KY,
Pori (FIN)
100 %
ECKART Suisse SA,
Vétroz (CHE)
100 %
ELANTAS Europe Srl.,
Collecchio (ITA)
100 %
ACTEGA Artística S.A.U.,
Vigo (ESP)
100 %
ACTEGA Rhenacoat SAS,
Sedan (FRA)
100 %
Central America
BYK Chemie de México,
S. de R.L. de C.V.,
Cuautitlán Izcalli (MEX)
100 %
ELANTAS Isolantes Elétricos
do Brasil Ltda.,
Cerquilho (BRA)
100 %
"},{"text":"ALTANA worldwide
ALTANA worldwide
U.S.
BYK USA Inc.,
Wallingford, CT
100 %
BYK Gardner USA,
Columbia, MD
100 %
ECKART America Corp.,
Painesville, OH
100 %
ELANTAS PDG Inc.,
St. Louis, MO
100 %
ACTEGA North America Inc.,
Cinnaminson, NJ
100 %
ACTEGA North America
Technologies Inc.,
East Providence, RI
100 %
ACTEGA Management Services Inc.,
Schererville, IN
100 %
as of December 31, 2019 South America
ACTEGA do Brasil Tintas
e Vernizes Ltda.,
São Paulo (BRA)
100 %
ACTEGA Terra Chile Ltda.,
Santiago de Chile (CHL)
100 %
Europe
BYK Additives Ltd.,
Widnes (GBR)
100 %
BYK Netherlands B.V.,
Deventer (NLD)
100 %
ECKART Benelux B.V.,
Uden (NLD)
100 %
ECKART France SAS,
Saint-Ouen (FRA)
100 %
ECKART Italia Srl.
a Socio unico,
Rivanazzano (ITA)
100 %
ECKART Pigments KY,
Pori (FIN)
100 %
ECKART Suisse SA,
Vétroz (CHE)
100 %
ELANTAS Europe Srl.,
Collecchio (ITA)
100 %
ACTEGA Artística S.A.U.,
Vigo (ESP)
100 %
ACTEGA Rhenacoat SAS,
Sedan (FRA)
100 %
Central America
BYK Chemie de México,
S. de R.L. de C.V.,
Cuautitlán Izcalli (MEX)
100 %
ECKART de México Industrias,
S. de R.L. de C.V.,
Cuautitlán Izcalli (MEX)
100 %
ELANTAS Isolantes Elétricos
do Brasil Ltda.,
Cerquilho (BRA)
100 %
"},{"text":"Sales Production
Asia
BYK Asia Pacific Pte Ltd.,
Singapore (SGP)
100 %
BYK Japan KK,
Tokyo (JPN)
100 %
BYK Additives (Shanghai) Co.,
Ltd., Shanghai (CHN)
100 %
BYK (Tongling) Co., Ltd.,
Tongling (CHN)
100 %
BYK India Private Ltd.,
Mumbai (IND)
100 %
BYK Korea LLC,
Gyeonggi-do (KOR)
100 %
ECKART Asia Ltd.,
Hong Kong (CHN)
100 %
ECKART Zhuhai Co., Ltd.,
Zhuhai (CHN)
100 %
ELANTAS Beck India Ltd.,
Pune (IND)
75 %
ELANTAS Malaysia Sdn Bhd,
Kuala Lumpur (MYS)
100 %
ELANTAS (Tongling) Co., Ltd.,
Tongling (CHN)
100 %
ELANTAS (Zhuhai) Co., Ltd.,
Zhuhai (CHN)
100 %
ACTEGA Foshan Co., Ltd.,
Shunde (CHN)
100 %
Germany
ALTANA AG, Wesel
ALTANA Management
Services GmbH,
Wesel
100 %
BYK-Chemie GmbH,
Wesel
100 %
ECKART GmbH,
Hartenstein
100 %
ELANTAS GmbH,
Wesel
100 %
ACTEGA GmbH,
Wesel
100 %
BYK-Gardner GmbH,
Geretsried
100 %
ELANTAS Europe GmbH,
Hamburg
100 %
ACTEGA DS GmbH,
Bremen
100 %
ACTEGA Metal Print GmbH,
Lehrte
100 %
ACTEGA Rhenania GmbH,
Grevenbroich
100 %
ACTEGA Terra GmbH,
Lehrte
100 %
"},{"text":"ALTANA AG
Abelstr. 43
46483 Wesel, Germany
Tel + 49 281 670 - 10900
Fax + 49 281 670 - 10999
www.altana.com
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