Nabaltec_E_GB2016

08 INTERVIEW WITH THE MANAGEMENT BOARD stand-alone solution under US corporate law. Now the challenge in 2017 is to implement this stand-alone solution operationally. DR. MICHAEL KLIMES: After we increased capacity at Schwandorf in 2016 for fine pre- cipitated aluminum hydroxide, we were able to maintain the consistent supply of our US customers with APYRAL® 40 CD. We delib- erately built up reserves at Schwandorf in the time between initiation of the Sherwin bankruptcy procedure and the production stoppage at Nashtec. As a result, the supply chain was optimized so as to avoid interrup- tions in supply since US customers have been supplied from Germany. The plan worked out excellent. GÜNTHER SPITZER: The transition was successful. The precautions taken by the company turned out to be the best scenario under the circumstances. This applies to the stand-alone solution, for which we took the most important step in mid-March 2017 by acquiring all shares in Nashtec. With the ad- ditional acquisition of production buildings and some technical equipment, we will now be able to use the current year to retool the production site in accordance with Nashtec’s requirements. We expect that we will be able to once again supply our US customers directly from Nashtec in the accustomed quality as of early 2018. Can the impact of the Nashtec develop- ments on the Group’s results in 2016 and 2017 be measured? JOHANNES HECKMANN: Every observer surely knows that a situation like this has to leave a mark on a company like Nabaltec, which generates about 13% of its revenues in the US. In particular, the increase in freight costs due to the need to supply US custom- ers from Germany have an impact on earn- ings. However, we shouldn’t forget the solid basis which we have in the US. Demand growth is unabated and the market potential is far from exhausted. This market is an enor- mous driver for us. “BY BUNDLING OUR R&D ACTIVITIES, WE FOCUS EVEN MORE ON OUR CUSTOMERS’ REQUIREMENTS AND THEIR APPLICATIONS.” |||| Nabaltec AG | Annual Report 2016

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