Dear shareholder,

The Orell Füssli Group can look back on a challenging first half of 2017. Net revenue of CHF 131.9 million was 5% lower than in the previous year and operating earnings of CHF 3.2 million were significantly below the half-year figure in 2016 (CHF 7.9 million). A decline of CHF 14.6 million in net revenue at Atlantic Zeiser compared to the previous year was chiefly responsible for the reduction in operating earnings.


Atlantic Zeiser suffered in the first half of 2017 from the after-effects of a very small order backlog at the start of the year. Orders received in the first six months of 2017 remained at the same level as a year earlier, and did not develop positively until the second quarter. Net revenue declined significantly across all business units compared to the previous year. After the very positive market trend in the banknote serialisation sector in 2016, the first half of 2017 saw a return to normal levels. Order intake and the order backlog in the Card Personalisation Systems business unit were higher than in the previous year, but net sales were below the previous year’s level due to the shortfall in the order backlog at the start of the year. The development of the Packaging business unit remained below expectations in terms of both net revenue and order intake in the first half 2017. Orders received in the second quarter give rise to expectations of an improvement by year-end.


At Security Printing net revenue increased as a result of changes in the product mix compared to 2016, but gross profit was only marginally higher for the same reason. EBIT was slightly lower than a year earlier due to additional expenditure on core operational issues. Action taken to improve productivity and efficiency was pursued further. The introduction of the 9th series of banknotes was continued successfully with the issue of the new 20-Swiss franc note. The high standard of security and quality of the new 50-Swiss franc note was affirmed by the international industrial community through its recognition as the best banknote of the year. Efforts to acquire new key customers were further intensified. In addition to the production of further denominations for our principal customers, printing of an initial newly acquired third-party contract is planned for the second half of 2017.


Book Retailing continued to be faced with a downward market trend in the first half of 2017, driven by the persistent changes in the purchasing habits of Swiss consumers. Book Retailing was able to hold its own satisfactorily in this difficult business environment. Implementation of the transformation programme launched in 2015 continued to be at the forefront of activities. This included both activities to stabilise sales as well as various cost-cutting measures. In order to reduce operating costs while at the same time preserving very good sites, various relocations as well as refurbishment and conversion work in the bricks-and-mortar branch network were approved and have in some cases already been implemented. The focus on the core “Orell Füssli” brand will be completed in the second half of the year with the final consolidation of all online brands.

The second half of 2017 for Orell Füssli will be dominated by efforts to recoup the shortfalls of the first six months. The focus at Atlantic Zeiser is on systematically maintaining the recently rising trend in order intake and realising definite progress in the Packaging business unit. At Security Printing, processing the large order backlog with higher productivity as well as acquiring customers in order to secure long-term capacity utilisation remain top priorities. At Book Retailing the transformation programme will continue to be pursued. In the coming months both the Board of Directors and Management of the Orell Füssli Group will closely monitor the implementation of these tasks.

Zurich, August 2017


Dr Anton bleikolm

Chairman of the Board of Directors


Martin Buyle

Chief Executive Officer