Press Release
12 March 2018

Sensirion Holding AG launches IPO on SIX Swiss Exchange and sets price range of CHF 28 to CHF 36

- Sensirion Holding AG, a leading global manufacturer of environmental and flow sensors domiciled in Staefa, Switzerland, today announces the launch of its Initial Public Offering (IPO) on SIX Swiss Exchange, the publication of the Offering Memorandum and the start of the bookbuilding process.

- The IPO consists of up to 9,331,428 shares. In the base offering, 6,150,000 existing shares are being offered by the majority shareholder, Gottlieb Knoch, and up to 1,964,286 newly issued shares are being offered by Sensirion. For the newly issued shares in the base offering, Sensirion is targeting gross proceeds in the amount of approximately CHF 55 million. In addition, Sensirion has granted the Joint Global Coordinators an over-allotment option of up to 1,217,142 newly issued registered shares. The shares issued under the over-allotment option will not exceed 15% of the total number of shares in the base offering.

- The net proceeds from the primary offering will provide Sensirion with enhanced flexibility for its future financing and corporate strategy and will enable Sensirion to exploit additional growth opportunities.

- The price range for the offered shares has been set at CHF 28 to CHF 36 per share, implying an offer volume of approximately CHF 227 million to CHF 276 million in the base offering (CHF 261 million to CHF 318 million assuming full exercise of the over-allotment option) and a total market capitalization of approximately CHF 404 million to CHF 503 million (CHF 438 million to CHF 545 million assuming full exercise of the over-allotment option).

- Felix Mayer and Moritz Lechner, Founders and Co-Chairmen of Sensirion, will not sell any of their shares in the IPO. They remain fully committed to the long-term development of the Company.

- Sensirion has established a stable pool of anchor shareholders, including the Founders, with the objective of creating long-term value for its shareholders by maintaining the company's entrepreneurial long-term strategy.

- In 2017, Sensirion generated revenue of CHF 148 million, an adjusted EBITDA of CHF 26 million and an adjusted EBITDA margin of 18%.

- In 2018, Sensirion expects revenue growth of 15-18% and an adjusted EBITDA margin of 15-16%. In the mid-term, Sensirion targets annual revenue growth of 10-15% and an annual adjusted EBITDA margin trending towards 20%.

- The first day of trading on SIX Swiss Exchange is expected to be on or around 22 March 2018.

Commenting on today's announcement Moritz Lechner, Founder and Co-Chairman of the Board of Directors of Sensirion Holding AG, said: "We are excited about the prospect of becoming a listed company on SIX Swiss Exchange. In our view, Sensirion is ideally positioned to capture the growth opportunities in environmental and flow sensors. Felix Mayer and I will retain a significant financial interest post IPO and continue to fully support Sensirion's further development. With the IPO, we aim to broaden our shareholder base and to establish a stable pool of anchor shareholders. This shareholder structure will secure the sustainable development of Sensirion as well as enable long-term value creation. We look forward to opening the next chapter in the history of our company."

Marc von Waldkirch, CEO of Sensirion, added: "Sensirion is a leader in the market for environmental and flow sensors and well positioned as a rare pure-play sensor company. We believe we can capture the growth in this market, driven by secular trends such as energy efficiency, quality of life, digitalization, automatization and the Internet of Things. Our company is built on a distinct corporate culture, based on fairness, honesty, cooperation and a commitment to top performance. Our people are essential to foster innovation and excellence. The ability to attract the best talents available and provide them with the right environment has distinguished Sensirion since its inception. For us, this is the best guarantee of success for the long-term future."

Offer structure

The IPO consists of up to 9,331,428 shares. In the base offering, 6,150,000 existing shares are being offered by the majority shareholder, Gottlieb Knoch, and up to 1,964,286 newly issued shares are being offered by Sensirion. For the newly issued shares in the base offering, Sensirion is targeting gross proceeds in the amount of approximately CHF 55 million. In addition, Sensirion has granted the Joint Global Coordinators an over-allotment option of up to 1,217,142 newly issued registered shares, exercisable in whole or in part within 30 calendar days after the first trading day on SIX Swiss Exchange. The over-allotment shares will not exceed 15% of the base offering.

The price range for the offered shares has been set at CHF 28 to CHF 36 per share, implying an offer volume of approximately CHF 227 million to CHF 276 million in the base offering (CHF 261 million to CHF 318 million assuming full exercise of the over-allotment option) and a total market capitalization of approximately CHF 404 million to CHF 503 million (CHF 438 million to CHF 545 million assuming full exercise of the over-allotment option).

Sensirion Holding AG is currently owned and jointly controlled by Gottlieb Knoch and the Founders Moritz Lechner and Felix Mayer. As of today, Gottlieb Knoch holds 55.5% and the Founders together hold 14.0% of the share capital, respectively.¹ Sensirion's employees hold 8.5% of the share capital^[1]. After the IPO, the Founders will remain fully invested in Sensirion as strong and independent anchor shareholders. The shareholder structure will consist of a stable pool of anchor shareholders, including the Founders, who will collectively hold 33.2% of the share capital if the shares sold in the IPO are placed at the mid-point of the price range. The additional anchor shareholders are 7-Industries and EGS Beteiligungen AG, both of which are committed to long-term value creation of Sensirion. Of the up to 9,331,428 offered shares, 1,650,538 offered shares have been set aside in a separate pool for purchase by 7-Industries and EGS Beteiligungen AG at the offer price (preferential allocation).

In connection with the offering, Sensirion established an IPO loyalty program for its employees. Each participating employee has received a number of restricted share units, subject to completion of the offering and vesting over two years. The aggregate maximum number of shares so allocated to participants will not exceed 4.5% of Sensirion's share capital prior to completion of the offering. The first half of the restricted share units will vest and be converted into shares at the end of the financial year in which the offering is completed, i.e. 31 December 2018, the second half on 31 December 2019. In addition, existing employees of Sensirion resident in Switzerland will have the opportunity to participate in the IPO and benefit from a preferential allocation of up to 61,500 offered shares.

Management shareholders and the company will be subject to a lock-up period of 12 months after the first trading day. The selling shareholder has committed to a lock-up period of six months after the first trading day.

Listing and commencement of trading expected on or around 22 March 2018

The bookbuilding process begins today, 12 March 2018, and is expected to end on or around 21 March 2018. The final offer price as well as the final number of the newly issued shares in the base offering are expected to be published on or around 22 March 2018 before the start of trading on SIX Swiss Exchange. The listing of the shares in accordance with the International Reporting Standard of SIX Swiss Exchange and commencement of trading in the shares on SIX Swiss Exchange is expected to take place on or around 22 March 2018.

The IPO of Sensirion consists of a public offering to investors in Switzerland as well as private placements in certain jurisdictions outside of Switzerland and outside of the United States of America, in each case in accordance with applicable security laws and in reliance on Regulation S under the U.S. Securities Act of 1933 and on the basis of exemptions provided by the Prospectus Directive, and private placements within the United States of America to qualified institutional buyers as defined in, and in reliance upon, Rule 144A.

Credit Suisse and J.P. Morgan are acting as Joint Global Coordinators and Joint Bookrunners for the IPO, along with Vontobel as Co-Bookrunner. Lazard is acting as financial adviser and Homburger AG as legal adviser to Sensirion.

Leading provider of environmental and flow sensors

Sensirion is a Swiss based leading global provider of environmental and flow sensors for the automotive, medical, industrial and consumer end markets. Based on 2016 revenue^[2], Sensirion is a leader in the market for combined humidity & temperature sensors with a market share of over 50% across all applications worldwide. Building on 20 years of industry experience, Sensirion has been at the forefront of sensor innovation with a strong track record of development and manufacturing of environmental and flow sensors. It produces around 350,000 sensors every day and to date has sold over 500 million sensors in total worldwide. Sensirion generated revenue of CHF 148 million, an adjusted EBITDA of CHF 26 million and an adjusted EBITDA margin of 18% in 2017. Sensirion expects revenue growth of 15-18% and an adjusted EBITDA margin of 15-16% in 2018. In the mid-term, Sensirion targets an annual revenue growth of 10-15% and an annual adjusted EBITDA margin trending towards 20%.

High market growth driven by secular mega trends

Sensirion is a leading global provider of environmental and flow sensors for the automotive, medical, industrial and consumer end markets. Driven by secular trends such as energy efficiency, quality of life, as well as digitalization and automation, which increasingly rely on sensor technology, these end markets are expected to grow considerably.

Market leader focused on environmental and flow sensors

In its core market for combined humidity & temperature sensors, Sensirion has built a leading market position across all target end markets, ranking first in the automotive (25% market share), the industrial (43% market share) and consumer (66% market share) end markets and a close second in the medical end market (37% market share) based on 2016 revenue². Sensirion's strong position in the market is reinforced by long product development cycles, proprietary technologies and manufacturing processes, as well as proven R&D capabilities.

Based on its proven ability to attain leadership, together with customer proximity and the broad range of its sensor product and application offering, Sensirion is well positioned to extend its success in combined humidity & temperature sensors to other products in its sensor portfolio, such as flow sensors and the recently added environmental sensors capable of sensing volatile organic compounds (VOC), particulate matter (PM2.5) and carbon dioxide (CO₂) in the air.

Superior technology and R&D capabilities

Sensirion has pioneered advanced sensor technology in the fields of environmental and flow sensing differentiated by a high level of accuracy, reliability and durability. Sensirion's position as a technology leader in this area and its well-stocked product pipeline is a result of its focused innovation and R&D investments. For the year ended 31 December 2017, R&D expenses represented 23%^[3] of total revenue and as of 31 December 2017, Sensirion employed around 220 full-time equivalent engineers and research professionals in the R&D department.

Long-term relationships with diversified and stable customer base in attractive end markets

Sensirion works strategically with key customers to devise sensor solutions that meet their requirements and specifications and to ensure proper functionality of its sensors in the customers' application. Sensirion also attaches great importance to customer proximity. This is reflected in the longevity of many of Sensirion's customer relationships, averaging over 7 years for the top five customers in terms of 2017 revenue. Additionally, Sensirion's customer base is highly diversified, both in terms of customer concentration, as well as in terms of customer distribution across target end markets.

Multidimensional growth strategy

Sensirion's growth story is based on multiple pillars. The first pillar is its strong market position, which allows to participate in the growth of the overall market for environmental and flow sensor applications and benefit from the resulting increase in demand for sensor products. The second pillar incorporates Sensirion R&D efforts, which are targeted to outperform market growth both due to new application opportunities for existing sensor products as well as the development and introduction of new sensors and technology platforms. The third pillar represents Sensirion's commitment to expanding long-term technology leadership and growth by developing new breakthrough products.

Attractive financial profile

Sensirion has consistently capitalized on the strong growth trends in its end markets to increase revenue. Specifically, for the years ended 31 December 2017, 2016, and 2015, it reported revenue of CHF 148 million, CHF 131 million, and CHF 117 million, respectively. During these periods, it has generated an adjusted EBITDA of CHF 26 million, CHF 26 million and CHF 15 million, respectively, and adjusted EBITDA margins of 18%, 20% and 13%, respectively. Sensirion has maintained resilient and relatively high gross margins of 57%, 55% and 53% in the same periods.

Highly qualified management team supported by dedicated founders and entrepreneurial company culture which attracts and fosters superior talent

Sensirion has a dedicated, long-serving management team with deep technical and industry experience and a track record of delivering growth through several macroeconomic cycles and technology transformations as well as successfully broadening its sensor product and application portfolio. The management team is complemented by the continued presence and strategic advice of the two founders and a highly qualified and committed workforce.

Long-term orientation secured by anchor shareholders

Sensirion's success is based on commitments to long-term orientation and continuous investments in innovation. Its board of directors is convinced that value to shareholders is optimized when adhering to these commitments, also as a listed company. For these reasons, Sensirion will establish a pool of anchor shareholders around the Founders and introduce a limitation on transferability and restriction on voting rights to be set at 5% (Vinkulierung). The main purpose of the anchor shareholder pool is to secure the independence of the company and maintain its entrepreneurial long-term strategy.

Key Data

Listing	SIX Swiss Exchange (International Reporting Standard)
Ticker symbol	SENS
Swiss security number	40 670 512
ISIN	CH 040 670512 6
Price range	CHF 28 to CHF 36 per share
Offering	Base offering of up to 8,114,286 shares, of which 6,150,000 existing shares are being offered by the selling shareholder and up to 1,964,286 newly issued registered shares are being offered by Sensirion. Sensirion is targeting gross proceeds in the amount of approximately CHF 55 million in the base offering.
	Over-allotment option of up to 1,217,142 shares which will not exceed 15% of the base offering.
Indicative schedule
Bookbuilding period	12 March 2018 until on or around 21 March 2018 noon CET
Pricing and allocation of shares	On or around 21 March 2018
Announcement of final offer price per share and final number of shares to be issued in base offering	On or around 22 March 2018
Listing and first day of trading	On or around 22 March 2018
Book-entry delivery of offered shares against payment of the offer price	On or around 26 March 2018

 

Media conference today at 8:30am CET

Sensirion is holding a media conference today Monday, 12 March 2018, starting at 8:30am CET, at Haus zum Rüden, Limmatquai 42, Zurich. Felix Mayer and Moritz Lechner, Co-Chairmen of Sensirion, Marc von Waldkirch, CEO, and Matthias Gantner, CFO, will inform about the planned transaction and provide further insight into the Company's market prospects and financial performance.

Key financial figures

in CHF million	2017	2016	2015	CAGR 2015-2017
Revenue	148	131	117	13%
Gross profit	85	73	61	18%
Gross margin	57%	55%	53%
Adjusted EBITDA*	26	26	15	33%
Adjusted EBITDA margin**	18%	20%	13%

 

* Adjusted EBITDA is calculated as profit / (loss) for the period before net interest expense, income taxes, depreciation and amortization (EBITDA), adjusted for net finance costs excluding net interest expenses, share of profit of equity-accounted investees, net of tax, impairment losses, and certain special items that management believes are not indicative of operational performance. In the period under review, these special items are (i) income from the disposal of assets; (ii) research and development expenses attributable to assets disposed in the period under review; (iii) costs related to acquisitions; and (iv) costs related to the Initial Public Offering. EBITDA adjustments totalled CHF 9.7 million, CHF 0.4 million and CHF 11.6 million in 2017, 2016 and 2015, respectively.

** Adjusted EBITDA margin is calculated as Adjusted EBITDA as a percentage of revenue for the period indicated.

Contact information

Investor Relations
Andrea Wüest, Director Investor Relations
Phone: +41 44 927 11 40
E-mail: andrea.wueest@sensirion.com

Media
Andreas Meile, Head Marketing & Communications
Phone: +41 44 306 49 06
E-mail: andreas.meile@sensirion.com

 

About Sensirion Holding AG

Sensirion Holding AG, headquartered in Staefa, Switzerland, is a leading manufacturer of digital microsensors and systems. The product range includes gas and liquid flow sensors, differential pressure sensors and environmental sensors for the measurement of humidity and temperature, volatile organic compounds (VOC), carbon dioxide (CO₂) and particulate matter (PM2.5). An international network with sales offices in the US, Europe, China, Taiwan, Japan and South Korea supplies international customers with standard and custom sensor system solutions for a vast range of applications. Sensirion sensors can commonly be found in the medical, industrial, automotive and consumer end markets. Sensirion is a global player with approximately 735 employees. Revenues in the financial year 2017 amounted to CHF 148 million. For further information visit: www.sensirion.com.

Disclaimer
This document and the information contained herein are not for distribution in or into (directly or indirectly) the United States, Canada, Australia or Japan or any other jurisdiction in which the distribution or release would be unlawful. This document does not constitute an offer of securities for sale in or into the United States, Canada, Australia or Japan.

This document does not constitute an offer to sell, or a solicitation of an offer to purchase, any securities in the United States. The securities of Sensirion Holding AG to which these materials relate have not been and will not be registered under the United States Securities Act of 1933, as amended (the "Securities Act"), and may not be offered or sold in the United States absent registration or an applicable exemption from, or in a transaction not subject to, the registration requirements of the Securities Act. There will not be a public offering of securities in the United States. Any sale in the United States of the securities mentioned in this communication will be made solely to "qualified institutional buyers" as defined in, and in reliance on, Rule 144A under the Securities Act.

This document is not an offer to sell or a solicitation of offers to purchase or subscribe for securities. This document is not a prospectus within the meaning of Article 652a of the Swiss Code of Obligations or a listing prospectus as defined in the listing rules of SIX Swiss Exchange AG. Copies of this document may not be sent to jurisdictions, or distributed in or sent from jurisdictions, in which this is barred or prohibited by law. The information contained herein shall not constitute an offer to sell or the solicitation of an offer to buy, in any jurisdiction in which such offer or solicitation would be unlawful prior to registration, exemption or qualification under the securities laws of such jurisdiction. A decision to invest in securities of Sensirion Holding AG should be based exclusively on the issue and listing prospectus published by Sensirion Holding AG for such purpose. Copies of such issue and listing prospectus (and any supplements thereto) can be obtained free of charge from Sensirion Holding AG, Investor Relations, Laubisruetistrasse 50, 8712 Staefa, Switzerland (email: andrea.wueest@sensirion.com), and at Credit Suisse AG, Zurich, Switzerland (email: equity.prospectus@credit-suisse.com).

This document does not constitute an "offer of securities to the public" within the meaning of Directive 2003/71/EC of the European Union, as amended (the "Prospectus Directive") of the securities referred to herein in any member state of the European Economic Area (the "EEA"). Any offers of the securities referred to in this document to persons in the EEA will be made pursuant to an exemption under the Prospectus Directive, as implemented in member states of the EEA, from the requirement to produce a prospectus for offers of the Securities. In any EEA Member State that has implemented the Prospectus Directive, this document is only addressed to and is only directed at qualified investors in that Member State within the meaning of the Prospectus Directive, i.e., only to investors who can receive the offer without an approved prospectus in such EEA Member State.

In the United Kingdom, this document is only being distributed to and is only directed at persons who (i) are investment professionals falling within Article 19(5) of the Financial Services and Markets Act 2000 (Financial Promotion) Order 2005 (as amended) (the "Order") or (ii) are persons falling within Article 49(2) (a) to (d) of the Order (high net worth companies, unincorporated associations, etc.) (all such persons together being referred to as "Relevant Persons"). This document is directed only at Relevant Persons and must not be acted on or relied on by persons who are not Relevant Persons. Any investment or investment activity to which this document relates is available only to Relevant Persons and will be engaged in only with Relevant Persons.

The Joint Global Coordinators and Joint Bookrunners as well as the Co-Bookrunner and their affiliates are acting exclusively for Sensirion Holding AG and the selling shareholder and no one else in connection with the contemplated IPO. They will not regard any other person as their respective client in relation to the contemplated IPO and will not be responsible to anyone other than Sensirion Holding AG and the selling shareholder for providing the protections afforded to their respective clients, nor for providing advice in relation to the contemplated IPO, the contents of this communication or any transaction, arrangement or other matter referred to herein.

Lazard GmbH is acting exclusively as financial adviser to the Sensirion Holding AG and no one else in connection with the IPO and will not be responsible to anyone other than Sensirion Holding AG for providing the protections afforded to clients of Lazard GmbH or for providing advice in relation to the IPO or any other matters referred to in this announcement. Neither Lazard GmbH nor any of its affiliates owes or accepts any duty, liability or responsibility whatsoever (whether direct or indirect, whether in contract, in tort, under statute or otherwise) to any person who is not a client of Lazard GmbH in connection with this announcement, any statement contained herein or otherwise.

This communication may contain statements about the future that use words such as, for example, "believe", "assume", "expect" and other similar expressions. Such statements about the future are subject to risks, uncertainties, and other factors, which can cause the true results of the company to differ significantly from that which is expressly or implicitly assumed in
these statements. In view of these uncertainties, the reader should not depend on this type of statement about the future. The company gives no undertaking whatever to update such statements regarding the future, or to adapt them to future events or developments.^[1] Adjusted for the envisaged split of existing shares and conversion of existing shares with preferential voting rights and existing participation certificates into a single share class, all expected to take place prior to the listing of Sensirion.
^[2] Source: Gartner Sensors Diligence Report 2018.
^[3] Excluding R&D expenses related to goodwill impairment losses in FY2017 (CHF 5.6 million).