Letter to Shareholders

Sika had a successful 2012 with sales growth of 5.8%, a rise in net profit of 31%, and a high level of operating free cash flow at chf 303 million. We accelerated our investments in the growth markets and opened new factories and production lines in a number of emerging countries. The emerging markets saw double-digit sales growth in 2012 and are already generating 37% of our consolidated net sales.

Despite the difficult economic conditions on many markets, Sika’s growth model, with its cornerstones of market penetration, technology leadership, accelerated expansion in the growth markets, and market consoli­dation through acquisitions, worked well during the past financial year. We achieved strong growth in the emerging markets in Asia and Latin America. In North America demand stabilized and we recorded a 9% rise in sales thanks to gains in market share. In Europe on the other hand, we felt the effects of the debt problem with to some extent significant declines in market volumes.

Sika accelerated its successful growth strategy in the emerging markets with a number of investment projects. In 2012, we invested considerable funds in the expansion of capacity, particularly in Brazil, Chile, China, Colombia, Mexico, Mongolia, Peru, Russia and Vietnam, which will improve the local supply chains…

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