The condensed consolidated semi-annual financial statements have been prepared in accordance with IAS 34 “Interim Financial Reporting”. They are based on the financial statements of the individual Group companies drawn up according to uniform accounting policies as of June 30, 2023. These condensed consolidated semi-annual financial statements as of June 30, 2023 have been audited by the statutory auditor. The condensed consolidated semi-annual financial statements are not subject to the same requirements as the consolidated annual financial statements. It is recommended to read the condensed consolidated semi-annual financial statements in conjunction with the consolidated financial statements as of December 31, 2022. The condensed consolidated semi-annual financial statements are published exclusively in English. The financial information disclosed in this report may not add up precisely to the disclosed totals due to rounding. Ratios and variances are calculated using the exact underlying amount and not the disclosed rounded amount. Autoneum’s business activities are not subject to pronounced seasonal fluctuations. The condensed consolidated semi-annual financial statements 2023 were authorized for issue by the Board of Directors on August 22, 2023.

Except as described below, the accounting policies applied in these condensed consolidated semi-annual financial statements are the same as those applied in the consolidated financial statements as of December 31, 2022.

In the reporting period, the Group has adopted International Tax Reform – Pillar Two Model Rules – Amendments to IAS 12 upon their release on May 23, 2023. The amendments provide a temporary mandatory exception from deferred tax accounting for the top-up tax, which is effective immediately and requires new disclosures about the Pillar Two exposure from December 31, 2023. The mandatory exception applies retrospectively. However, because no new legislation to implement the top-up tax was enacted or substantively enacted at December 31, 2022 in any jurisdiction in which the Group operates and no related deferred income taxes were recognized at that date, the retrospective application has no impact on the Group’s condensed consolidated semi-annual financial statements. The relief and the new disclosures will also be reflected in the Group’s consolidated financial statements at year-end.

On April 1, 2023 Autoneum acquired the automotive business of Borgers, including tangible assets and inventories of the Borgers companies in Germany and 100% of the shares in the subsidiaries in France, Poland, Sweden, Spain, the Czech Republic, the United Kingdom, the USA and China. The product and customer range of Borgers Automotive, the specialist for textile acoustics protection, insulation and trim for vehicles, ideally complement Autoneum’s sustainable product portfolio. Particularly with the wheel arch liner and trunk lining product lines as well as the truck business, Autoneum’s global presence offers further potential for profitable growth also outside Europe.

Due to its weak financial situation Borgers SE & Co. KGaA filed for insolvency as of October 17, 2022. Consequently, Autoneum acquired the automotive supplier Borgers SE & Co. KGaA from insolvency with effect from April 1, 2023. The consideration for this transaction amounted to CHF 122.4 million. In return, the Group acquired total net assets of CHF 231.4 million, leading to a bargain purchase gain of CHF 109.1 million. The bargain purchase gain is recognized as other operating income.

The following table summarizes the recognized amounts of assets acquired and liabilities assumed at the date of acquisition, valued at their fair value.

The consideration of CHF 122.4 million represents the final amount. Based on the complexity involved when acquiring a business from insolvency proceedings and the required reassessments when recognizing a bargain purchase gain, the purchase price allocation is still provisional in nature with regards to the assets acquired and liabilities assumed at the date of acquisition.

The Group incurred acquisition-related costs of CHF 2.2 million on legal fees and due diligence costs. CHF 1.1 million of these costs was recognized in profit or loss in the current period, while​ CHF 1.1 million was recognized in profit or loss in the financial year 2022.

In a business combination, the determination of the fair value of the identifiable assets acquired, particularly intangibles, requires estimations which are based on all available information and in some cases on assumptions with respect to the timing and amount of future revenues and expenses associated with an asset. The purchase price is allocated to the underlying acquired assets and liabilities based on their estimated fair value at the time of acquisition. The remaining difference is reported as goodwill or bargain purchase gain. As a result, the purchase price allocation impacts reported assets and liabilities, future net results due to the impact on future depreciation and amortization expense and impairment charges. The purchase price allocation is subject to a maximum adjustment period of twelve months.

The consolidated revenue of the acquired automotive business of Borgers since the acquisition date amounts to CHF 173.1 million, while the net result of the acquiree since the acquisition date amounts to CHF 4.1 million.

If the acquisition had taken place on January 1, 2023, the consolidated revenue of Autoneum would have amounted to CHF 1 277.0 million and the consolidated net result would have amounted to CHF 62.0 million, for the six months ended June 30, 2023.

Tangible assets are tested for impairment if there are indications that due to changed circumstances, their carrying amount may no longer be recoverable. In 2023, CHF 52.0 million of the impairment charges on tangible assets are attributable to Business Group North America and CHF 1.9 million of the impairment charges are attributable to Business Group Europe.

Updated OEM production forecasts show that the market in North America is unlikely to recover peak production volume anymore. The result is a lower than originally assumed future revenue level for Business Group North America which leads in consequence to lower cash flows and triggered an impairment of tangible assets.

The value in use is thereby determined based on future discounted cash flows. As a basis for the calculation, a three-year mid-term plan is used. Subsequent years are estimates, including a perpetual annuity. The projections are based on knowledge, experience and on judgments made by management as to the probable economic development. The underlying projections for the subsequent years are therefore calculated based on historical figures and the latest market estimates. Post-tax discount rates were applied in determining the recoverable amount of the cash-generating unit. The discount rates were estimated based on an industry weighted average cost of capital (WACC).

As a result of the impairment calculation, the carrying amount of the cash-generating unit (fully owned operations of the Business Group North America) was determined to be higher than its recoverable amount of CHF 273.1 million and an impairment charge of CHF 52.0 million was recognized.

Holding other assumptions constant, a change of 100 basis point of the WACC applied would have affected the impairment charge up to an amount of CHF 40.3 million, while a change of 100 basis point of the terminal value EBIT margin applied would have affected the impairment charge up to an amount of CHF 17.7 million.

Segment information is based on Autoneum Group’s internal organization and management structure as well as on the internal financial reporting to the Group Executive Board and the Board of Directors. Chief operating decision maker is the CEO.

Autoneum is the globally leading automobile supplier in acoustic and thermal management for vehicles. Autoneum develops and produces multifunctional and lightweight components and systems for noise and heat protection and thereby enhances vehicle comfort.

The reporting is based on the following four reportable segments (Business Groups/BG): BG Europe, BG North America, BG Asia and BG SAMEA (South America, Middle East and Africa). The acquired business is integrated into the existing segments. “Corporate and elimination” includes Autoneum Holding Ltd and the corporate center with its respective legal entities, an operation that produces parts for Autoneum’s manufacturing lines, investments in associated companies and inter-segment eliminations. Transactions between the Business Groups are made on the same basis as with independent third parties.

Neither significant changes in the fair value hierarchy nor in the fair value measurement assumptions of financial instruments occurred in the period under review. The Group neither issued, repurchased nor repaid Autoneum bonds in the reporting period.

Autoneum maintains a long-term credit agreement with a bank syndicate in the amount of CHF 350.0 million, whereof CHF 183.5 million was drawn at June 30, 2023 (December 31, 2022: CHF 164.9 million). On January 31, 2023, the Group signed an additional bridge facility agreement with UBS and Credit Suisse in the amount of CHF 150 million, initially drawn on March 31, 2023, and with final maturity date on January 31, 2024. At June 30, 2023 the CHF 150 million bridge facility agreement was fully utilized.

On March 23, 2023, the shareholders of Autoneum Holding AG approved at the Annual General Meeting a capital band authorizing a capital increase of approximately CHF 100 million net proceeds, in order to partially finance the acquisition of the automotive business of the Borgers Group.

There were no events between June 30, 2023 and August 22, 2023 which would necessitate adjustments to the book value of the Group’s assets or liabilities, or which require additional disclosure in the condensed consolidated semi-annual financial statements.