Board of
Directors’ Report

Dear Shareholders,

In a challenging environment shaken by the Covid-19 pandemic, Vetropack Group achieved an EBIT margin of 11.5% (2019: 12.5%). Consolidated net sales stood at CHF 662.6 million (2019: 714.9 million). At the end of the year, the Group acquired a glass works in Moldova in a takeover which was financed by the Group’s own funds.


Vetropack Group consistently drove forward its successful expansion strategy and acquired the Moldovan Glass Container Company S.A. glass works on 10 December 2020. With this acquisition, the Group is growing in a region where it has been successfully manufacturing and selling glass packaging for almost three decades. The new subsidiary fits seamlessly into Vetropack's markets in Central and Eastern Europe.

The new Vetropack Glass Container Company S.A. in Chișinău produces approximately 100,000 tonnes of glass packaging for the food and beverage industry annually, which is sold on both a growing domestic market in Moldova and on the export market. At the end of 2020, 504 people were employed by the Moldovan glass works and it generated a turnover of approximately EUR 40 million in 2019. The Moldovan subsidiary was fully consolidated for the first time as of 31 November 2020.

The impact of the Covid-19 pandemic on unit sales and net sales

Vetropack Group sold 4.86 billion units of glass packaging in the 2020 fiscal year (2019: 5.16 billion units), which was 5.9% less than in the previous year. As catering establishments were closed for months due to the coronavirus, demand for wine, beer and above all soft drinks, mineral water and fruit juices fell. The lockdown also led to more demand for foodstuffs stored in glass jars.

The Group generated consolidated net sales of CHF 662.6 million, 7.3% lower than the previous year (2019: CHF 714.9 million). This only amounted to a 3.5% reduction in local currencies. The changes brought about by the pandemic ensured that it was mainly lower-priced glass packaging that was affected by the reduction, thus increasing the average price of glass packaging sold.

Development of the Vetropack companies

The Covid-19 pandemic had a huge influence on the 2020 fiscal year. The entire European container glass industry had to reduce its production capacities and even shut down production lines.

Vetropack also reduced its production capacities temporarily and produced a total of 1.42 million tonnes (2019: 1.46 million tonnes), 3% down on the previous year.

The Swiss subsidiary generated net sales of CHF 94.8 million (2019: CHF 88.6 million). Thanks to the good vintage year and a Group-wide focus on the special green campaigns at the St-Prex plant, the company managed to increase net sales by 7.1%. Vetropack Austria’s two glass works – Pöchlarn and Kremsmünster – achieved net sales of EUR 203.5 million (2019: EUR 202.6 million).

Thanks to high exports and a large proportion of glass packaging for foodstuffs, the net sales recorded for the Czech company Vetropack Moravia Glass remained virtually stable at CZK 2377.9 million (2019: CZK 2398.7 million) in comparison to the previous year.

The Slovakian company Vetropack Nemšová increased its net sales by 10.1% to EUR 71.8 million (2019: EUR 65.2 million). In the 2020 fiscal year, the company had full use of a new coloured-glass furnace and this additional capacity led to an increase in unit sales.

The net sales of the Croatian company Vetropack Straža stood at HRK 791.3 million (2019: HRK 862.5 million). Tourism in Croatia hit a low due to the Covid-19 pandemic. This, together with the lockdowns, led to a reduction in net sales of 8.2%.

The Ukrainian subsidiary Vetropack Gostomel achieved net sales of UAH 1948.2 million in 2020 (2019: UAH 2416.7 million), which was 19.4% less than in the previous year. The Covid-19 pandemic led Ukraine back into an economic crisis, and not only did Vetropack Gostomel see a reduction in sales, but it also needed to adjust the prices of its glass packaging.

The net sales of the Italian subsidiary Vetropack Italia stood at EUR 85.4 million (2019: EUR 78.8 million), which was 8.4% more than in the previous year. Following an extensive overhaul in 2019, the company had more capacity available in the reporting year. In addition, Vetropack Italia sold more glass packaging domestically which was manufactured by sister companies.

Solid profitability

Within the confines of the Covid-19 pandemic, Vetropack coordinated its Group-wide capacities in the 2020 fiscal year so that it was able to optimise the required cuts in production from an economic point of view. At the same time, strict cost reductions were implemented in all areas. Thanks to these extensive measures, the Vetropack Group achieved a consolidated EBIT of CHF 76.1 million (2019: CHF 89.4 million) and an EBIT margin of 11.5% of net sales (2019: 12.5%).

Consolidated profit increased

The consolidated annual profit rose by 12.2% to CHF 81.2 million (2019: CHF 72.4 million) and the profit margin stood at 12.3% (2019: 10.1%) In the first half of 2020, the Vetropack Group sold a property in the Swiss canton of Zurich which was not required for operations. The one-off proceeds after tax amounted to CHF 9.1 million.


Well-invested liquidity

Cash flow amounted to CHF 141.2 million in 2020 (2019: CHF 153.3 million), which equated to 21.3% (2019: 21.4%) of net revenue. The Vetropack Group invested CHF 73.7 million net in tangible and intangible assets (2019: CHF 123.7 million). The main investment was the construction of a new furnace and all the associated infrastructure at the Croatian glass works. In the second half of the year, CHF 42.8 million was also used to acquire the new subsidiary in Moldova. All investments were fully financed by the Group’s own funds. Free cash flow reached CHF 37.9 million (2019: CHF 28.1 million). The Group’s net liquidity fell to CHF 59.7 million (2019: CHF 81.4 million).

Balance sheet structure

Consolidated total assets amounted to CHF 991.5 million (2019: CHF 949.2 million). Higher accounts receivable and stock levels led to higher short-term assets of CHF 395.3 million (2019: CHF 365.0 million). Investments led to an increase in long-term assets to CHF 596.2 million (2019: CHF 584.2 million). Liabilities increased to CHF 227.9 million (2019: CHF 200.8 million) due to taking on loans from the new Moldovan subsidiary.

Shareholders’ equity increased to CHF 763.6 million (2019: CHF 748.4 million). The equity ratio fell marginally to 77.0% (2019: 78.8%). At the end of the reporting year, the Vetropack Group employed a workforce of 3,882 people (31 December 2019: 3,366 people).

Vetropack share

The Annual General Assembly of Vetropack Holding Ltd proposed a 1:50 share split on 22 April 2020. The listed bearer shares were converted into registered shares A (ISIN CH0530235594) and the registered shares were renamed as registered shares B (ISIN CH0530235602).

The stock market price of registered share A was CHF 59.7 at the end of 2020 (31 December 2019: CHF 60.8).


The Board of Directors will propose to the Annual General Assembly on 21 April 2021 that the dividend for the previous year be set at 130.0% of the nominal value. This equates to a gross payout of CHF 1.30 (2019: CHF 1.30) per registered share A and a gross payment of CHF 0.26 (2019: CHF 0.26) per registered share B.

Outlook for the 2021 fiscal year

The COVID-19 pandemic has changed almost all areas of life. It is still uncertain when and how quickly the economy will recover again.

Vetropack Group will have full capacity at its disposal in the 2021 fiscal year; no major furnace overhauls are required. As the “pro glass” trend shows no sign of abating, we assume that we will be able to fully utilise the capacities available in 2021 as things stand.

In 2020, the changes caused by Covid-19 led to increased use of warehousing across the entire European container glass industry. In addition, the costs of raw materials, energy and transport fell. This led to an increasingly competitive market with high pressure on margins during the reporting year. At the beginning of 2021, energy and transport costs rose disproportionately and it is uncertain whether these price increases will be accepted by the market in the short term.

For these reasons, we expect the Group to be able to increase net sales organically and via acquisitions in the event of similar exchange rates. The EBIT margin may decline somewhat.

The new glassworks planned by Vetropack in Boffalora sopra Ticino, Italy, remains the Group’s central strategic project in 2021. The groundbreaking ceremony will be held in the course of this year.

Thank you very much

The Board of Directors would like to thank all of our employees for their outstanding commitment and hard work during the 2020 fiscal year. We would also like to thank our customers, suppliers, business partners and shareholders for their support and the confidence that they have shown in us.

Bülach, 10 March 2021

Claude R. Cornaz

Chairman of the Board of Directors

Johann Reiter



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