Annual Report 2006 (PDF) - Schulthess Group

Annual Report 2006

Content
Schulthess Group – a dynamic enterprise
Core activities of the Schulthess Group 2
Brief overview of 2006 4
Key figures 5
Editorial 6
Environment and Ecology 10
Social responsibility 12
Schulthess Group – a survey of the group
Heating/Cooling Technology 15
Washing Technology 21
Corporate Governance 24
Schulthess Group – the group in figures
Consolidated balance sheet 34
Consolidated income statement 35
Consolidated cash flow statement 36
Consolidated statement of changes in equity 37
Notes to the consolidated financial statements 38
Report of the group auditors 61
Schulthess Group – visionary tradition
Milestones 66
Companies of the Schulthess Group 67
Financial calendar 68
Investor Relations 68
Schulthess Group – the holding in figures
Balance sheet 62
Income statement 62
Notes to the financial statements 63
Proposed appropriation of available earnings 64
Report of the statutory auditors 65

Schulthess Group Core activities 2
Core activities of the Schulthess Group
The core activities of the Schulthess Group are the development, manufacture
and distribution of products and services in two divisions:
Heating and Cooling Technology and Washing Technology
Genvex A/S
Haderslev/DK
Schulhess Maschinen AG
Wolfhausen/CH
Production plants of the Schulthess Group
Division: Washing Technology | Heating/Cooling Technology and Ventilation
KKT Kraus Kälteund
Klimatechnik GmbH
Lauf a. d. Pegnitz/DE
Alpha-Innotec GmbH
Kasendorf /DE
Heating and Cooling
Technology Division
This division of the Schulthess Group focuses
on the development, production and international
distribution of heat pumps, commercial
and industrial cooling and air-conditioning
units, and controlled ventilation systems. The
rapidly growing emphasis on the importance
of renewable energy sources, of which these
systems and products are classic examples,
has contributed to an impressive breakthrough
for the Group in recent years, especially
in Europe. The European markets are
just beginning to take off. We can therefore
predict with confidence that these products
and systems will continue to have considerable
growth and sales potential.
Heat pumps are heating units that are used
primarily in heating systems for detached
homes and apartment buildings, but also
increasingly in commercial premises.
Three-quarters of the heat is produced from
renewable sources – from ground heat, air
or water, depending on the system. Heat is
extracted from the source and converted by
the heat pump into a form which the system
can use to heat rooms or hot water. Sales are
strongest in central and northern Europe, and
there is steadily growing interest in southern
and eastern Europe.
The Cooling and Air-conditioning segment
develops and manufactures air-conditioning,
cooling and ventilation systems for use
in medical equipment, laboratories and
operating theatres, in telecommunications
(e.g. in main frame computers and servers),
in the food industry, refineries, shops, etc. In
addition to standard cooling units, there are
numerous requests for individually designed
and manufactured custom systems. The
market for the systems, units and products of
this division is worldwide.

Schulthess Group Core activities 3
In many European countries, house-building
projects are increasingly being obliged to
comply with ultra-low energy standards and
air-tightness norms. This leads to a growing
demand for internal ventilation systems for
these buildings. Controlled residential ventilation
can provide a pleasant living environment
in closed spaces, and tackle humidity- and
allergy-related problems. The technology
of these advanced systems with immense
potential is based on the same heat pump
principles. Sales are concentrated in northern
Europe and growing steadily in central Europe.
Alpha-Innotec GmbH, the heat pump production
facility, is based in Kasendorf, Germany.
KKT-Kraus Kälte- und Klimatechnik GmbH in
Lauf an der Pegnitz, Germany, specializes in
the development and production of cooling
and air-conditioning equipment. Systems
and appliances for controlled residential
ventilation are manufactured by Genvex A/S in
Haderslev, Denmark.
The following Group companies also belong
to the Heating and Cooling Technology
Division:
• Alpha-Innotec GmbH, Kasendorf, Germany
• Novelan GmbH, Kasendorf, Germany
• KKT - Kraus Kälte- und Klimatechnik GmbH,
Lauf a. d. Pegnitz, Germany
• Genvex A/S, Haderslev, Denmark
• Calmotherm AG, Altishofen, Switzerland
• Novelan AG, Bereich Siemens Wärmepumpen,
Dällikon, Switzerland
Washing Technology
Division
In washing technology, the Schulthess Group
is a leading manufacturer of automatic
washing machines and dryers in the domestic,
commercial and industrial segments. It
pursues a clearly focused premium strategy
as regards products, quality and pricing, and
is positioned at the top end of the market.
An important element of its product strategy
is the emphasis on ecological responsibility.
Long product life, energy efficiency and the
use of high-quality materials underpin all
product development.
In the household appliance segment, which
generates the highest volumes and sales, the
Group manufactures and distributes washing
machines and dryers both for individual households
(detached homes or owner-occupied
apartments) and for apartment buildings.
The commercial and industrial appliances
(wash extractors and commercial dryers,
together with a commercial range of rotary
and flat-bed irons) is geared towards the
requirements of commercial firms, hotels,
residential homes and hospitals.
On its home market in Switzerland, the
Washing Technology Division is present in all
market segments. Sale is made through own
subsidiaries allover Switzerland. Our division
has a significant share of the market in all
segments in Switzerland, and is one of the
leading suppliers.
In international sales, the Washing Technology
Division concentrates on the commercial and
industrial segments as well as communal
laundries. The division has independent
importers or private label representatives in
all European countries. The Austrian market is
served by a group-owned sales subsidiary.
All the division’s domestic and commercial
laundry appliances are manufactured in
Wolfhausen, Switzerland.
The Washing Technology Division is made
up of the following Group companies:
• Schulthess Maschinen AG, Wolfhausen,
Switzerland
• Merker AG, Dällikon, Switzerland
• Novelan AG, Bereich Haushalt, Dällikon,
Switzerland
• Schulthess Maschinen GmbH, Vienna,
Austria

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Schulthess Group Brief overview of 2006 Max M. Müller 4
CFO
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Brief overview of 2006
04 05 06
Sales in million CHF
Cash flow in million CHF
01.01.2006 31.12.2006
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Konzerngewinn
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SPI
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Group sales
For the first time in the company‘s history,
sales topped the CHF 300 million mark: over
CHF 306 million compared with CHF 184
million in 2005. This was equivalent to an
increase of 66 %.
Sales in the Heating/Cooling Technology
Division stood at more than CHF 184 million
(2005: CHF 64 million). This massive increase
was accounted for by organic growth of CHF
57 million and acquired growth of CHF 63
million. The major share of organic growth
was generated by heating technology and
our main product, heat pumps. In the cooling
technology sector, KKT Kraus Kälte- und Klimatechnik
was consolidated for the first time
and reported sales of CHF 63 million.
The Washing Technology Division increased
sales slightly from CHF 120 million to CHF 122
million.
Material costs
As a percentage of sales, the cost of materials
rose from 35.2 % to 41.1 %. This was accounted
for by the Heating/Cooling Technology
Division. Vigorous growth in this division
pushed up material costs disproportionately
because Heating/Cooling Technology
generates slightly lower value added than the
Washing Technology Division.
Personnel costs
On average throughout 2006, the Schulthess
Group had 951 employees, which translates
into an increase of 54 %. Personnel costs for
2006 amounted to CHF 80.4 million (+ CHF
23.7 million). This development too was a
result of the strong growth in the Heating/
Cooling Technology Division. In order to avoid
delivery bottlenecks, employees put in more
overtime and we took on temporary staff.
Advertising costs
We ramped up advertising in Europe‘s most
important heat pump markets in order to
boost penetration. Advertising costs amounted
to CHF 13 million, or 4.3 % of Group sales.
Operating profit (EBIT) and
net profit
EBIT was up from CHF 24.9 million (2005)
to CHF 46.4 million (2006), or by 86.6 %.
The Heating/Cooling Technology Division
contributed more than CHF 30 million of this
figure. Washing Technology improved its EBIT
by almost CHF 17 million. The EBIT margin was
thus over 15 %.
The increase in net profit was likewise impressive
and the operating margin stood at 10.5 %.
This generated a net profit of more than CHF
32 million.
Key balance sheet figures
Vigorous growth also resulted in sharp increases
in both current and fixed assets. Total assets
on 31 December 2006 stood at CHF 213 million
(2005: CHF 174 million). Shareholders‘ equity
continues to account for more than 60 % of
total assets. Liquid assets amounted to more
than CHF 13 million on 31 December 2006.
Investments
The Schulthess Group made another round
of major investments in production facilities
in 2006. A new factory is currently under
construction at our heat pump production
headquarters in Kasendorf (Germany), which
will push up production capacity fourfold.
The investments in washing technology are
mainly designed to boost productivity. All in
all, CHF 19 million were invested in property,
plant and equipment and intangible assets
in 2006.

Schulthess Group Finances Key figures 5
Key figures 2004 –2006
Sales 306,602 184,536 165,330
Operating cash flow EBITDA 54,703 30,584 25,376
as % of sales 17.8 % 16.6 % 15.3 %
Operating profit EBIT 46,391 24,861 20,439
as % of sales 15.1 % 13.5 % 12.4 %
Profit for the year (EAT) 32,265 18,302 16,124
as % of sales 10.5 % 9.9 % 9.8 %
Total assets 213,624 174,085 137,112
Current assets 108,853 84,150 72,897
as % of total assets 51.0 % 48.3 % 53.2 %
Non-current assets 104,771 89,935 64,215
as % of total assets 49.0 % 51.7 % 46.8 %
Short-term liabilities 66,540 47,689 33,164
as % of total assets 31.1 % 27.4 % 24.2 %
Long-term liabilities 17,561 21,638 14,615
as % of total assets 8.2 % 12.4 % 10.7 %
Shareholders‘ equity 129,523 104,758 89,333
as % of total assets 60.6 % 60.2 % 65.2 %
Return on Equity (ROE) in % 27.5 % 18.9 % 19.4 %
CAPEX and acquisitions, net 18,890 33,711 5,452
as % of operating cashflow EBITDA 34.5 % 110.2 % 21.5 %
Number of employees 951 618 587
Sales per employee (in CHF) 322,400 298,602 281,652
Number of registered shares 1,062,500 1,062,500 1,062,500
Earnings per share EPS (in CHF) 30.37 17.23 15.18
Price/earning ratio 28.75 18.87 11.82
EBITDA per share (in CHF) 51.49 28.78 23.88
Price/EBITDA ratio 16.96 11.29 7.51
Dividend per registered share (in CHF) 12.00 8.00 7.00
Pay-out ratio 39.52 % 46.44 % 46.13 %
Shareholders‘ equity per share (in CHF) 121.90 98.60 84.08
Closing price (in CHF) 873.00 325.00 179.30
High (in CHF) 884.00 336.00 179.80
Low (in CHF) 322.00 176.00 120.00
Market capitalization (in CHF 1,000) 927,563 345,313 190,506
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Schulthess Group Editorial Rudolf Kägi Artur Rodecker 6
Chairman CEO
Dynamic growth and high profitability
The Schulthess Group continues to grow rapidly, with sales climbing
steeply once again. Operating results were above expectations and
the Group is poised to develop successfully and highly profitably in
the years ahead.
Dear Shareholders
Our Group continues to grow vigorously and profitability
too is developing extremely positively.
The Heating/Cooling Technology Division has played a
decisive role in the Group‘s development and for the first
time ever, sales and profits during the year under review
accounted for the lion‘s share of Group figures. Against
a positive economic backdrop and growing acceptance
for low-energy-consumption heating systems, the Heating/Cooling
Technology Division established itself as the
fastest-growing business unit in our Group. The Washing
Technology Division operates in saturated markets and, as
a result, only posted a slight improvement. However, there
are many important synergies between the two divisions in
supply management, production and distribution/marketing,
which can be further developed.
Group sales rose from CHF 184 million in 2005 to CHF 306
million. This increase of CHF 122 million is equivalent to a
percentage increase of 66 %. Of this figure, CHF 59 million
was achieved through organic growth, while KKT Kraus
Kälte- und Klimatechnik, which was acquired with effect
from 1 January 2006, accounted for the remaining CHF 63
million. With CHF 184 million, or 187 %, the Heating/Cooling
Technology Division generated most of the growth.
The remainder was achieved by the Washing Technology
Division. EBIT rose from CHF 24.9 million to CHF 46.4
million, which is equivalent to an EBIT margin of 15.1 %
(2005: 13.5 %). Net profit, too, was up markedly from CHF
18.3 million to CHF 32.3 million, which represents a net
profit margin of 10.5 % and exceeded our expectations.
Dynamic development
in the Heating/Cooling Technology
Division
The Heating/Cooling Technology Division comfortably
exceeded budgeted growth figures in its heating technology,
cooling technology and ventilation segments.
Heat pump applications have turned to be a reliable
guarantee of growth. The high prices of gas and oil, both
of which are subject to massive fluctuation, combined with
an increasingly unstable geopolitical situation, were instrumental
to the disproportionately high increase in heat
pump sales in Germany and France. In the second and third
quarters of 2006, this led to major production bottlenecks
with relatively long lead times.
At our Alpha-Innotec GmbH factory in Kasendorf, Germany,
work is proceeding full speed ahead to increase
available production capacity fourfold by spring 2007 and
to establish modernized, partially automated production
processes that will give us even greater flexibility when
dealing with existing market circumstances.
As an all-round supplier, Alpha-Innotec overhauled its
entire range of geothermal heat pumps in 2006. As a
result, the Heating/Cooling Technology Division now has a
market-leading, state-of-the-art product line in the range
up to 33 kW, which is equally suitable for new housing
starts and renovations.
In the controlled residential ventilation segment, Genvex
A/S in Haderslev, Denmark, also reported an encouraging
year. Controlled ventilation is being used increasingly in
modern buildings throughout Europe. There are three main
reasons for this: to maintain property value; to increase
comfort; and to comply with regulations issued by the EU
and individual legislations. Genvex is successfully positioned
in the premium segment and supplies multifunctional
systems that are able to exchange, heat and cool air, and
supply hot water, all with a single unit.
The growth in sales was achieved by a concerted expansion
of international distribution structures and a notable
improvement in the company‘s market position in Denmark.
Economies of scale and improvements in production
processes have significantly improved profitability.

Schulthess Group Editorial Rudolf Kägi Artur Rodecker 7
Chairman CEO
Cooling and air-conditioning technology operations, which
were acquired on 1 January 2006 with the KKT Kraus
Kälte- und Klimatechnik GmbH company in Lauf, Germany,
were integrated in the Schulthess Group last year. An
increased willingness on the part of industry to make
capital investments again has had a very positive influence
on both the company‘s fields of activity. Sales of custommade
cooling units, which are distributed worldwide
through OEM partners, have been particularly encouraging.
The custom systems unit acquired and completed
a significant number of major orders both at home and
abroad. In its first year as a member of the Group, the
company reached all its sales targets and clearly exceeded
its profit targets.
Washing Technology reports slight
increase
The Washing Technology Division, whose main market is
Switzerland, reported slight growth last year. Sales were
up minimally by 1.5 % compared with 2005. EBIT, too, was
up nominally on the previous year. We have introduced
a concerted package of measures to generate stronger
growth and continue to assign high importance to profitability
in this division. The launch of a new generation
of household washing machines and driers in 2006 will
provide the basis for expansion of its markets. The major
strengths of the new models are ease of operations, convenience
and intelligence, and they are designed for use in
private homes and apartment building laundry rooms.
Sales of the new semi-professional ProLine series developed
in 2005 also showed encouraging growth.
Prices and conditions in our export markets remained
stiffly competitive, and we failed to achieve our targets.
Sales in some countries were actually down, and we intend
to rectify this situation in the course of 2007.
Rudolf Kägi
Chairman and Delegate
of the Board of Directors
Artur Rodecker
CEO

Schulthess Group Editorial Rudolf Kägi Artur Rodecker 8
Chairman CEO
Stock price
After the massive increases in our share price of previous
years, we expected things to proceed at a somewhat more
leisurely pace last year. However, continued positive sentiment
on the equity markets and in the economy, together
with a boom in heat pumps, showed that our business
plans had been somewhat conservative. Price increases
were significantly higher than expected, which did not go
unnoticed by investors. With a stock growth of over 168 %
and a stock value of CHF 873 as per 31 December 2006 our
stock has been a veritable outperformer. Over a twelvemonth
period, we were the third-best stock in the SPI.
Even in a five-year comparison of all SPI stocks, Schulthess
can be found up at the forefront. This demonstrates the
sustainability of our company‘s development and at the
same time proves that the Schulthess Group has been
transformed into a dynamic growth corporation. This,
too, is how we see our task and will be sticking to our aim
of generating sustainable growth both organically and
through acquisitions, while maintaining and increasing the
company‘s profitability.
Outlook 2007
The Heating/Cooling Technology Division‘s continued
dynamic growth will serve to accentuate its importance to
the Schulthess Group as a whole.
The main priority in the heat pump sector will be to expand
our international markets with a view to maintaining the
pace of future growth.
Expansion of production capacity will be our first priority.
The attendant improvement in productivity will enable us
to offset increases in the price of raw materials like steel
and alloys and other components, which in turn will keep
us internationally successful.
In the Washing Technology Division, we will need to make
more concerted efforts to establish a stronger foothold in
international markets with a selective product range and
to introduce further rationalization measures to keep us
competitive.
Sincere thanks
We should like to thank our investors in the name of
the Group for their loyalty to our company. Through our
dividend policy, we intend to give them a fitting share of
our success.
We should also like to thank our many customers in
Europe who have shown their trust in us and bought our
products, directly contributing to this positive result.
Finally, and very especially, we should like to offer our
sincere thanks to our employees, whose commitment and
hard work have contributed so much towards the successful
development of our company.
Rudolf Kägi Artur Rodecker
Chairman and Delegate CEO
of the Board of Directors

Schulthess Group Environment and Prof. Dr. Wagner 10
Ecology
Future applications of renewable energy
to water and space heating
Sales figures for heat pumps have risen meteorically in recent years. No doubt the
trend has been spurred by significant rises in oil and gas prices. However, the underlying
reasons are this technology‘s increasingly high profile, and an awareness of its
efficiency, environmental friendliness and cost effectiveness. Heat pump technology
has been innovative for decades.
Professor Ulrich
Wagner, D. Eng.
Chair of Energy
Management and
Application Engineering,
Munich Technical
University
Independent expert Prof. Dr. Ing. Ulrich Wagner
looks at the qualities which distinguish the
heat pump from other regenerative technology
options and from cogeneration and discusses
further developments that may be expected.
End-consumption of energy for space heating
accounts for around 30 % of the energy
balance sheet. The main energy sources for
space heating are oil and gas plus, to a lesser
extent, coal-fired remote heating systems and
electric heating plant, including heat pumps.
The ambitious policy targets now being set
to cut CO2 emissions pose major challenges
to every energy application, especially space
heating. Further technical improvements in
the heating of buildings, and successive modernization
of heating systems, can achieve
significant reductions.
The heat pump of today is a highly developed
technical system, tried over many years, using
low-temperature heat from solar energy. The
same process has been used for many decades,
in hundreds of millions of cooling plants.
Energy is input to compress a coolant boiling
at low temperature. This allows the use of
ambient air, geothermal sources, groundwater
(and sometimes also waste heat such as flue
gas), which would otherwise be unusable.
This is how the main regenerative energy
sources are exploited. Geothermal sources
and groundwater store solar energy and break
the interdependency of supply and demand.
The main advantages of heat pumps can be
summarized as follows:
• High energy efficiency
• Diversification of primary energy sources
used for space heating. This is important
to energy policy, because it draws on the
whole spectrum of energy sources in the
power generation mix
• No emissions at place of use
• Very long lifetime with relatively low maintenance
costs
• No space taken up with tanks and chimneys
• The heat pump can be used to provide
monovalent or monoenergetic heating
systems; there is no need for an auxiliary
system.
Alternative options
One of the most exciting possible uses of
renewable energy in our latitudes is solar
low-temperature heat generation. A broad
range of simple solar panels already exists on
the market (e.g. for swimming pool heating).
These range from ordinary panels (typically
to provide hot water) to costlier vacuum
tube systems (to boost hot water and space
heating).
A plant for solar-supported water heating
normally consists of a panel, which heats the
hot water tank via an additional inbuilt heat
exchanger. A conventional boiler provides
the supply at times when incoming radiation
or buffer storage prove insufficient to meet
demand.

Schulthess Group Environment and Prof. Dr. Wagner 11
Ecology
If boost heating is required in addition to
solar-powered hot water, the necessary panel
surface can be estimated at around 1 sq. m
per 10 sq. m of active area. This makes a
10 –30 % heating boost possible, assuming
that the contribution to hot water supply is
unaltered at 60–80 %.
Solar power plants have now reached a high
technical level and will cross the economic
viability threshold if oil prices continue to rise.
The combustion of biogenic energy sources
releases only the quantity of CO2 which
was taken from the atmosphere during the
growth of the plant. This form of energy use
is therefore CO2-neutral, apart from losses
during preparation of the fuel and transport
to the place of use. Technical systems for
biogenic energy sources are now available in
many forms: from fi rewood-burning stoves to
central heating with wood pellet-fi red boiler
and fully-automated equipment. The market
offers a wide range.
There are also plants for cogeneration of heat
and power. These are usually fi red by natural
gas and are therefore non-regenerative (apart
from biogas and biofuel plants), but I mention
them here because of their high public
profi le. They generate electricity and heat
simultaneously. The heat is usually not suffi
cient to meet the entire electricity and heat
requirement of a building, but can be fl exibly
dimensioned to operate in tandem with the
grid and a conventional heating system. The
typical dimensioning is around 30 % of maximum
heat output. This meets around 70 % of
annual heating requirements, the rest being
produced via a conventional system.
In conclusion
Thus a geothermal probe heat pump can
achieve energy savings of around 30 % on a
modern low-temperature oil-fi red boiler and
15 % on the newest gas condensing central
heating boiler. Compared with older heating
systems, savings are even higher, up to
50 %. At current fuel prices, the investment is
written off after a few years only. Rising gas
and oil prices further enhance the cost-effectiveness
of heat pumps.
Primary energy
1 ⁄3 electricity
+
2 ⁄3 renewable energy from
air or
water or
geothermal heat
While the development of the heat pump is
already very advanced, it is far from complete.
Thus, for example, there is room for further
improvement of the plant components. Modifi
ed control systems and combined units for
heating, hot water, ventilation and possibly
cooling can increase effi ciency and benefi ts
further. In future, reversible heat pumps might
cater for the growing need for cooling in offi ce
and residential buildings.
In view of the qualities I have described, the
heat pump will further increase its market
share and make a signifi cant contribution to
energy saving and CO2 reduction.
Alpha-Innotec
heat pump with
– heeting
– hot water
– ventilation

Schulthess Group Social responsibility Felix Kolb 12
Human Ressources
Basic and further training
as a corporate endeavour
All basic and further training activities undertaken by the Schulthess Group are part of its staff policy, which is itself
derived from the company‘s overall policy. The education and training initiatives are ambitious, and geared to corporate
issues and needs.
Felix Kolb
Human Ressources
Michèle Baltensperger
Human Ressources
The importance of qualified
staff for corporate success
A company‘s competitiveness depends largely
on the extent to which it succeeds in achieving
product and process innovation through
the development of new products and the
intelligent application of new technologies,
as well as organization and management
methods. The capacity for innovation is, in the
main, determined by the availability of the
necessary knowledge and expertise at various
operational levels. The filling of job vacancies
and the implementation of a basic and further
training programme are crucial to the building
up of these resources.
Decentralized training
structure
The Schulthess Group consists of separate,
largely autonomous units, which are organized
as classic SMEs. And so the SME spirit
pervades the whole group, and lends the
organization flexibility, drive and innovativeness.
Our approach to basic and further training
is likewise decentralized. Each subsidiary
determines its own training programme in the
light of local conditions and requirements. The
variations in specific expertise in the different
companies can be taken into consideration
and built into the training of skilled specialists.
The Schulthess Group focuses on three
main areas in its training programmes: the
training of apprentices, the integration of new
entrants, and the targeted development of
existing staff.
Apprentice training
Through the training of apprentices, the
Schulthess Group accepts its social responsibility,
and helps create a pool of highly
qualified, industry-specific specialists. Apprenticeships
are offered exclusively in areas
where the individual firms offering places
have a particular expertise. In this way a high
standard of training can be guaranteed. By
adopting the rotation principle, which allows
apprentices to familiarize themselves with
different departments within a particular organization,
we can ensure an all-round training
that promotes understanding of corporate
interrelationships. The apprentice gains a
knowledge of the possible job opportunities
and can plan his or her future career path.
Our policy of targeting apprentices from
the local community upgrades the area and
makes it less likely that young people move
away in search of work.
Induction programme
A company relies not only on the human resources
it develops in-house, but also on the
wider employment market. These new recruits
bring with them valuable know-how, ideas and
experience from other sectors, cultures and
companies. In order to realize their full potential,
they need to acquire the skills necessary
for a specific industry as well a knowledge of
the processes, procedures and culture peculiar
to a specific company. Our comprehensive
induction programmes for all new employees
merge existing skills with the requirements
of their new situation. The programmes may
last several weeks and may include areas not
directly related to their immediate role in the

Schulthess Group Social responsibility Felix Kolb 13
Human Ressources
organization. This transfer of know-how gives
new entrants a sound basis for making full use
of their skills in their respective organization.
Staff development
The appointment of new staff is only one
way of improving collective knowledge, but
the further training of employees who have
been with the company for years is at least as
important. For this reason we strongly encourage
and support professional and personal
development for all our staff.
There are three stages to the process. In
the first phase, we identify development
opportunities and activities. At the same time,
if necessary, we offer career advice, reviewing
and updating the goals identified on an
annual basis. The second phase is the actual
training. The Schulthess Group considers the
duration and cost implications on a case-bycase
basis. The third phase is the practical
application of newly acquired knowledge. This
is achieved principally through the extension
of existing responsibilities or by the move to a
new role within the group.
All these initiatives are of vital importance
for the companies, because employees who
continually update their knowledge, and
whose potential is fully realized, make a
decisive contribution to the achievement of
corporate goals.

Schulthess Group Heating/Cooling Heinz Weggel 15
Technology Division Alpha-Innotec GmbH
Heating/Cooling Technology Division
posts rapid growth
The Heating/Cooling Technology Division can look back on a remarkably successful year, with an increase in sales
of 187 % and EBIT growth of 213 %. This means that for the first time the results of the Heating/Cooling Technology
Division have excelled those of the Washing Technology Division. The Schulthess Group will continue to focus on the
Heating/Cooling Technology Division because it has considerable long-term potential.
For some years now already, in response
to market assessments and forecasts, the
Schulthess Group has focused its corporate
strategy on the Heating/Cooling Technology
Division. Developments and results of the
past few years, and particularly in 2006, are
unequivocal: the strategy has proven to be
astute and is now paying off.
Nevertheless, we are still very much at the
beginning. The market potential has grown
considerably, particularly in Europe. For this
reason, the Schulthess Group will continue to
push ahead with expansion of the Heating/
Cooling Technology Division. Apart from this,
the Schulthess Group intends to establish
itself as a leading provider in all its markets.
In its Heating/Cooling Technology Division,
the Schulthess Group concentrates on
three main areas: heating technology (main
products: heat pumps) – cooling technology
– controlled ventilation.
All business areas performed over average
in 2006, wheras heat pump sales and profits
rose overproportional.
Heating technology
Heat pump markets expanding at full speed
The market for heat pumps in Europe has
developed way beyond expectations.
Estimates were forecasting average market
growth of approx. 30 % in Europe
Sales figures in Germany have literally exploded
(approx. 140 % market growth, or around
43,000 new units). With a 20-25 % market
share in the new housing sector, the heat
pump has established itself as the heating
system of the future in Germany once and for
all.
Growth rates even in relatively „saturated“
markets with a high proportion of heat pumps,
such as Switzerland (approx. 30 % market
growth and about 16,000 units) underscore
the continued increase in the importance of
heat pumps.
Double-digit growth was also reported in
France, Austria, the UK and Eire, Benelux and
eastern Europe.
Despite the boom, various market studies are
predicting an uninterrupted upward tendency.
By 2010, the industry is expecting a total
market of some 400,000 units.
Heating/Cooling Technology Division 31.12.2006 31.12.2005
in CHF 1,000
Sales 184,241 64,020
Operating Profit EBIT 30,417 9,712
EBIT Margin 16.5 % 15.2 %
Heinz Weggel
Managing Director
Alpha-Innotec GmbH

Schulthess Group Heating/Cooling Heinz Weggel 16
Technology Division Alpha-Innotec GmbJ
Ground-breaking ceremony in Kasendorf (DE) with the Bavarian Environment Minister Dr. Schnappauf
Extension 2007/2008
Factory-extension Alpha-Innotec GmbH in Kasendorf (DE)
Expansion of production capacity
In retrospect, the Schulthess Group‘s
decision in 2005 to go ahead with a massive
increase in capacity at its Kasendorf factory
was absolutely spot-on. Once the facility is
finished, Alpha-Innotec will be able to push up
production to four times its present level.
Construction work got under way at the
beginning of 2006 following a groundbreaking
ceremony at which Bavarian Environment
Minister Dr. Werner Schnappauf turned the
first shovelful of earth. The first heat pumps
from the new facility are due to come off the
production line in spring 2007. The Group‘s
foresight has ideally equipped Alpha-Innotec
to meet the growth in Europe that has been
forecast.
A further construction stage starting in 2007
and ending in 2008 will see the completion
of an administrative and training centre. This
investment will enable Alpha-Innotec to intensify
important projact- and sales-trainings
for installers, distributers and international
sales agencies as well as for its after-sales
services, which are all-important for products
like these.
Extension 2006

Schulthess Group Heating/Cooling Heinz Weggel 17
Technology Division Alpha-Innotec GmbH
New products
The R&D department continued to pursue its
highly successful compact product strategy. In
2006, for example, we completely redesigned
and relaunched the entire geothermal and
water range. Within the space of a few years,
the entire product portfolio (air, earth and
water) has thus been realigned and Alpha-
Innotec now holds a leading position in this
area in Europe.
The new compact heat pumps now offer
customers appliances that are virtually ready
to connect, have a small footprint and already
contain many of the components for heating
and brine circuits that need to be installed
externally on standard heat pumps.
At the same time, there is increasing demand
for heat pumps that provide not only warmth
but also low-cost, environment-friendly cooling.
Virtually all the geothermal heat pumps
from Alpha-Innotec come with the option of
„passive cooling“, as it is know. Compared
with traditional oil- or gas-fired heating
systems, this feature is extremely convenient
for the customer.
Alpha-Innotec has also made a significant
move on the markets with the development
of unusually efficient, high-performance heat
pumps that derive their energy from air. The
company rolled out a number of products
whose efficiency is eminently suitable for old
buildings in need of renovation and systems
with a very large heat output.
Our designers and developers also pay
particular attention to the issue of noise
suppression. In this area, Alpha-Innotec has a
considerable amount of know-how and offers
extremely quiet-running appliances.
Distribution
Expansion of the division‘s distribution
channels continued apace as part of moves
to strengthen the Alpha-Innotec and Siemens
brands. As a result, the Alpha-Innotec brand
has been successfully positioned as an international
provider and is recognized as one
of Europe‘s major heat pump specialists. By
concentrating on heat pumps, which are now
its core business, the company has managed
to expand its share of its two domestic markets,
Switzerland and Germany, as well in an
ever-expanding export market.
In a bid to further internationalize its operations,
the company will now be focusing
on France, Great Britain, Austria and the
Existing factory of Alpha-Innotec GmbH in Kasendorf (DE)
Scandinavian countries. New legislation in all
these countries has significantly increased
demand for heat pumps. From an organizational
point of view, the division chooses to
work with independent distribution partners
whose experience and specialization qualify
them ideally for this particular task. Marketing
activities, documentation and customer trainings
form an important part of sales.
Outlook
A number of extremely promising sales channels
are currently being established and in
2006 the company finalized agreements with
suitable export partners in high-growth countries
as well as big-name OEM customers.
The heat pump has undoubtedly established
itself as the system of choice for new housing
projects and is gradually replacing conventional
heating systems. However, enormous
potential is also forecast for the technology in
modernizations and renovations. With this in
mind, Alpha-Innotec will be presenting a new
series of high-performance air / water heat
pumps at ISH Frankfurt, the world‘s biggest
fair for building, energy, ventilation technology
and renewable energies, in spring 2007.

Schulthess Group Heating/Cooling Dr. Rainer Gay 18
Technology Division KKT Kraus Kälte- und Klimatechnik GmbH
Dr. Rainer Gay
Managing Director
KKT Kraus Kälte- und
Klimatechnik GmbH
Rack cooler-based air-conditioning systems
Cooling technology
Developments in cooling technology in 2006
The cooling technology sector made a
pleasing contribution to the division‘s overall
growth in 2006. Compared with 2005, sales
were up by 38 %. EBIT, too, was up substantially
as a result of tight and consistent cost
control.
Virtually all activities in the cooling technology
sector made an equal contribution to
growth.
Custom systems
Custom systems developed positively in 2006
and recorded an encouraging increase compared
with previous years. The department
specializes in building one-off, tailor-made
systems for individual customers.
One of the vital ingredients of our success
here is our insistence on using only highquality
components which we manufacture
ourselves in systems with technology of
equally high quality, and offering customers
all-inclusive solutions from a single supplier.
Several top-grade projects were completed
in the medical and laboratory sector. These
included a biomedicinal laboratory for a pharmaceuticals
group in Leiden (Netherlands),
four state-of-the-art operating theatres for
a clinic in Amsterdam, a radiological examination
centre for a clinic in the UK, as well as
operation centers for clinics in England and
Northern Ireland.
Cooling technology also supplied convincing
proof of its speed and flexibility by installing
an air-conditioning system for a call centre in
Berlin at extremely short notice. Apart from
this, the company supplied its first rack cooler-based
air-conditioning systems to a publishing
company and the Max Planck Institute.
These have been designed specially for server
clusters that generate large amounts of heat.
OEM customers
(Industrial cooling systems and chillers for
medical diagnosis instruments)
The main business issues for industrial coolers
were future strategic planning, reorganization
and consolidation. The continuing slide
in market prices for the sector‘s core products
was offset by sales of energy-saving systems.
New trends in the market for highly specialized
media coolers point out the way for the
years ahead. Customers are focusing increasingly
on investment costs, product precision
and, above all, life-cycle cost. Despite the
exacting demands, we succeeded in acquiring
several new major customers.
The medical technology key account management
sector has a good chance of developing
further by exploiting synergies within the
group while maintaining the same high quality
standards and expanding distribution. At
the same time, it will play a major role in the
cooling technology sector‘s product portfolio.
Outlook
Expectations for 2007 are positive for
both custom systems and the OEM sector.
Preparations are under way for more projects
from neighbouring countries in Europe as well
as a wide-ranging project involving several
clinics for the Russian Federal Centres. We
are also targeting substantial sales increases
in rack-cooling systems through selective
acquisitions and marketing measures.
As part of our medium- to long-term success
strategy in the OEM customer sector in 2007,
we have planned a number of new products as
well as significant strengthening of our aftersales
service.

Schulthess Group Heating/Cooling Peter Ebdrup 19
Technology Division Genvex A/S
Controlled ventilation
Market development
In many European countries, building projects
are subject increasingly to new standards
and official requirements that demand
more efficient insulation for buildings using
construction materials that reduce energy
use. Ultra-low energy standards are a feature
demanded of more and more new buildings.
The EU, for instance, has already introduced
various directives on the subject. Developments
like this will require the installation
of the controlled ventilation appliances and
systems used in the air-conditioning and
cooling of buildings designed along these
lines. In the ventilation sector, we registered a
considerable increase in demand, particularly
in Scandinavia.
In Europe, then, importance is being increasingly
attached to a healthy climate both at
work and in our own four walls. The demand
for suitable products is rising significantly.
Forecasts indicate that growth here will
double in the next five to eight years.
Sales in 2006
The controlled ventilation sector recorded a
outstanding rise in sales for 2006. This was
achieved mainly as a result of intensified
efforts in marketing and sales.
Product development / Products
Thanks to a new corporate design, product
strategy and an innovative marketing concept,
the sector reported satisfactory growth in
2006 and will continue to work in the same
direction in 2007, with a particular focus on
quality and growth.
Distribution
The sector substantially strengthened its
distribution arm in its domestic market of
Denmark as well as the Scandinavian countries.
In these states, strict building regulations
provide the conditions necessary for an
acceleration in sales growth. Other countries
with a special need for controlled ventilation
systems are Germany and Austria.
Peter Ebdrup
Managing Director
Genvex A/S
Outlook / Focus 2007
In 2007 this sector will be looking towards
further, faster growth. The necessary market
conditions are certainly there. We believe the
market in many countries is set to continue
growing strongly.
New products, expansion of distribution
channels in various countries and improved
marketing are the measures we will be
adopting to anchor the Genvex brand and its
products successfully in European markets.

Schulthess Group Washing Technology Hans Jürg Schwendener 21
Division Merker AG and Novelan AG
Washing Technology Divisions
posts modest growth
The Washing Technology Division reported slight overall growth from CHF 120 million to 122 million in its usual
markets. The slide in prices mentioned in 2005 continued in 2006 as a direct consequence of surplus capacity.
The Washing Technology Divisions‘ profitability was nevertheless encouraging and up slightly on the previous year.
For the current year, we expect another moderate increase and stable profitability.
The Schulthess Group is keenly aware of the
importance and significance of its traditional
washing technology operations within the
context of its overall strategy. However, it is
difficult to achieve significant organic growth
in saturated markets. Our priority is to hold
our position and grow at least in line with the
overall market.
But our strategy has been – and remains – to
expand our sound market position in washing
technology on the basis of a premium product
strategy. This is the reason we continue to
make selective investments at our Wolfhausen
factory, and why we are systematically
renewing our range. The strategy ensures our
development and the division‘s economic
success.
The Washing Technology Division mainly
addresses two segments: private households
(detached houses and apartment buildings)
and commercial (hotels, homes for the elderly,
nursing homes, hospitals and laundries).
Washing Technology Division 31.12.2006 31.12.2005
in CHF 1,000
Sales 122,361 120,516
Operating Profit EBIT 16,817 16,123
EBIT Margin 13.7 % 13.4 %
Households
Market development
The private household market in Switzerland
developed positively in 2006. This trend
was due mainly to increased activity in new
housing starts. Indicators from the industry
(planning permission applications and approvals,
as well as the number of apartments
being completed) remain positive.
New range
At the start of the year, Schulthess and Merker
successfully rolled out new product lines: the
Schulthess Spirit XLI series, and the Merker
Bianca / Vento d-Line, respectively. These
newly developed washing machines and
dryers for private households and apartment
buildings offer considerable added value for
customers in the form of new and practical
product features. To coincide with the launch
of the new product lines, both brand images
were overhauled and all product documentation
completely revised.
Outlook for 2007
The target once again, for 2007, is to achieve
a further improvement in the household
segment. The measures pinpointed include
intensified marketing efforts, selective and
innovative product modifications and improved
services from our after-sales service.
Hans Jürg Schwendener
Managing Director
Merker AG
and Novelan AG
Energy efficiency classes A+ and B
The new fiscal year got off to a positive start
when the Schulthess and Merker brands
made successful presentations of their full
household ranges at Swissbau. The spotlight
here was on the further improved XLI and
d-Line machines; here, the automatic washing
machines were recently awarded an A+ label,
while the condensation dryers achieved a B
label in the highest-possible energy efficiency
categories.
More new dryers are scheduled for mid-2007.
These, too, will come with functions and
features that offer customers considerably
more practical value. We expect that the new
products, combined with our marketing and
distribution efforts, should lead to further
growth.

Schulthess Group Washing Technology Hans Peter Stamm 22
Division Schulthess Maschinen AG
Hans Peter Stamm
Head of Marketing,
Sales, Customer
Services, Schulthess
Maschinen AG
Hotel Swiss Holiday Park at Morschach with Schulthess-Wäscherei
Commercial Switzerland
Positive market development
The Swiss market for professional laundry
applications (hotels, homes for the elderly,
nursing homes, hospitals and laundries) developed
encouragingly in 2006. The industry
benefited from a generally positive investment
environment, with customers finally overcoming
their reluctance to spend money and
beginning to modernize their laundries.
Pleasing sales growth
Schulthess registered encouraging growth in
its commercial machine segment during the
year under review, further consolidating an
already strong market position. Concerted
marketing measures combined with figures
based on genuine business situations are
beginning to bear fruit, as many homes and
hotels revert to running their own in-house
laundries for economic and quality reasons.
New, expanded commercial range
Schulthess maintains an intense dialogue
with its customers, taking on board invaluable
ideas and insights that then flow into its new
product development. Suggestions like these
have to led to improvements in the latest
versions of the ProLine washing machine
dryer range, but were also incorporated in the
industrial dryers launched in the second half
of the year that made a sizeable contribution
towards the good result.
Schulthess has also specialized in featuring
the WetClean system in its products. With this
process, it is possible to clean sensitive modern
textiles (outerwear, fire brigade clothing,
Gore-Tex, etc.) with water and ecological
liquid detergents. Our industrial machines and
new commercial models feature the washing
and drying programs required for use of the
process.
Following its acquisition of the general distributors
for VEIT professional ironing products
(ironing stations, shirt finishers), Schulthess
is now a one-stop shop for professional
laundry machines and has ideally rounded
off its range. This has led to considerable
expansion in the customer network.
Outlook for 2007
Provided that the economy remains stable, we
expect a further increase in commercial sales
in Switzerland this year.

Schulthess Group Washing Technology Gion A. Huonder 23
Division Schulhess Maschinen AG
Commercial Europe
Commercial segment: export concept
For exports, Schulthess focuses mainly on
Europe and is mostly represented by partners
who distribute its products under the Schulthess
label or their own. Partners tend to be
specialists with many years of experience in
laundry equipment but are often only able to
cover a section of the possible segments in
their markets. Schulthess is therefore often
compelled to have several distributors in the
same market. Schulthess export products are
used exclusively for commercial or industrial
purposes.
Development in 2006 below expectations
Growth in our export markets in 2006 unfortunately
failed to keep pace with developments
on the domestic market in Switzerland. Sales
were below target and in some markets
actually fell. This is attributable mainly to the
fact that foreign markets and prices are stiffly
competitive.
New distributors
We are happy to note that we managed to
acquire new distribution partners for the
markets in Russia, Ukraine, Bulgaria, Romania
and Germany. The medium-term outlook
in all these countries is interesting, but a
considerable amount of effort will be required
if we are to establish an acceptable market
position.
Outlook for 2007
Our aim this year is to ramp up export
activities and open new distribution channels.
We also have plans to expand distribution
through our existing partners. In its new
generation of ProLine machines, Schulthess
now has a suitable range of machines for
export, which together with the other measures
should enable us to achieve our growth
targets.
Production
Investments in capacity in 2006
The encouraging increase in capacity utilization
in 2006 put our production facilities under
pressure. In order to cover our own needs
for sheet metal as well as rising demand from
Alpha-Innotec, we invested a total of CHF 4
million in modernization and automation of
our production facilities, particularly the fully
automated sheet metal section.
Robots number seven and eight were installed
in the washing machine assembly section.
These new semiautomatic systems are used
for clinching – or press-joining – washing
machine housings and have halved throughput
time.
Investment projects for 2007
The following large-scale projects are
projected for 2007, the main objectives being
to increase capacity and further rationalize
production:
A world-wide novelty: the RAS-Multibend Center
Gion A. Huonder
Head of Production,
Logistics, Schulthess
Maschinen AG
• In April 2007, the surface-finishing
department will go into production following
a complete renovation. Apart from
increasing capacity, this will virtually halve
energy costs and massively reduce the
department‘s ecological footprint.
• Capacity in the sheet metal punching and
bending section will need to be increased
again in 2007. To achieve this, the two
existing punching systems will be replaced
by two fully automated Trumpf TruPunch
5000 machines. This will boost punching
capacity by a full 50%.

Schulthess Group Finances Corporate Governance 24
Corporate Governance
Schulthess Group AG (“the Company”) is strongly committed to good corporate governance.
In the interest of our shareholders, we regularly inform, with a high degree of
transparency, about our financial results and business activities as well as latest events.
In addition to the information in the annual and half-year reports, there are many
details about the enterprise on our corporate homepage www.schulthess-group.com.
1. Corporate structure and shareholders
1.1 Corporate structure
The operational corporate structure is shown in the following organisational chart.
Schulthess Group AG
Board of Directors
Chairman/Delegate: Rudolf Kägi
Vice Chairman: Dr. Peter R. Isler
Members: Prof. Dr. Christian Belz, Andrea Malär, Thomas D. Rutz
Schulthess Group
CEO Artur Rodecker, CFO Max M. Müller
Waschtechnik Wärme- / Kältetechnik
Schulthess Maschinen AG CH Alpha-Innotec GmbH DE
Schulthess Maschinen GmbH AT Novelan GmbH DE
Merker AG CH
Novelan AG (Household) CH
KKT Kraus
Kälte- und Klimatechnik GmbH DE
Genvex A/S DK
Calmotherm AG CH
Novelan AG (Heating/Cooling) CH

Schulthess Group Finances Corporate Governance 25
Consolidated entities
a) Listed company
Company Schulthess Group AG
Domicile Bubikon/ZH
Listing SWX Swiss Exchange
Market capitalisation as of 31 Dec. 2006
CHF 927,563 million
Own shares held as of 31 Dec. 2006 0 %
Security number SGRN / 00 1 878 504
ISIN CH0018785045
b) Non-listed companies
The consolidated non-listed companies belonging to
Schulthess Group AG are shown on page 37 of the financial
report.
1.2 Significant shareholders
The following shareholders owned more than 5 % of the
registered shares as of 31 December 2006:
Name of shareholder Dec. 31, 2006 Dec. 31, 2005
Rudolf Kägi 10.05 % 10.23 %
Paul O Rutz. 9.99 % 9.99 %
Focus Capital, UC 6.83 % ‹ 5 %
Andrea Malär 5.42 % 5.28 %
GlobeFlex Capital, LP 5.16 % ‹ 5 %
Schulthess Group AG is not aware of any shareholders’
agreements or of any other arrangements between its
significant shareholders with regard to the registered
shares in Schulthess Group AG or the execution of shareholders’
rights.
1.3 Cross shareholdings
Schulthess Group AG has not entered into any cross shareholdings
with other companies based on either capital or
voting rights.
2. Capital structure
2.1 Capital
The ordinary share capital of the Schulthess Group AG
amounts to CHF 2,125,000.
2.2 Authorised and conditional capital in particular
As of 31 December 2005, there was no additional authorised
or conditional capital.
2.3 Changes in capital structure
The ordinary share capital of the Schulthess Group AG did
not change during the year under review.
Shareholders’ equity changed mainly due to the increase
in retained earnings. The structure of shareholders’ equity,
during the last three years reported, is the following:
Shareholders’ equity Schulthess Group AG
(in CHF 1,000) Dec. 2006 Dec. 2005 Dec. 2004
Ordinary share capital 2,125 2,125 2,125
Reserves for own shares 0 0 4,558
Reserves 24,856 24,856 20,298
Retained earnings 46,757 41,568 32,834
Total 73,738 68,549 59,815
2.4 Shares
The share capital is divided into 1,062,500 registered
shares with a par value of CHF 2 each. All registered
shares are entitled to dividend payments. Each registered
share with voting right entitles to one vote. Only persons,
registered in the stock ledger of Schulthess Group AG,
as shareholders with the right to vote, may exercise the
voting right. The voting right per shareholder is restricted
to a limit of 5% of all registered shares reported in the
commercial register. An exception to this rule are those
shareholders, who held more than 5% of the shares in
Schulthess Group AG prior to the initial public offering
(“grandfathering”). Ownership of shares by foreign investors
is not subject to any limitation.
2.5 Participation certificates or Bonus certificates
Schulthess Group AG has neither participation certificates
nor bonus certificates outstanding.
2.6 Details of transferability
The transferability of registered shares, with respect to
ownership as shareholder or usufructuary, is subject to the
approval by the Board of Directors. The approval can be
refused for important reasons, such as:
1. In case, an acquirer were to own or to acquire as a
shareholder directly or indirectly more than 5% of
the total amount of registered shares reported in the
commercial register. The Board of Directors can make
exceptions from this rule.

Schulthess Group Finances Corporate Governance 26
2. Insofar as the recognition of an acquirer as a shareholder,
according to the information available, could hinder
the Company to provide proof, that it is Swiss controlled,
as demanded by federal laws.
3. If the acquirer does not explicitly declare to the Company,
that he acquired and will hold the shares in his
own name and for his own interest.
Legal entities and groups of joint owners, who are related
to one another through capital ownership, voting rights,
common management or in any other manner, shall be
considered as one sole acquirer. The same shall apply for
all persons or legal entities or groups of joint owners, who
act in concert, as a syndicate or in any other manner with
the intent to evade the limitation on voting rights.
Schulthess Group AG maintains a stock ledger, listing the
name and address of the holders and usufructuaries. The
register in the stock ledger requires the condition, that the
acquisition of shares for ownership or as a usufructuary
can be proven.
A simplification or the abolition of restriction rules on
voting rights or the transferability of registered shares
requires a resolution of the Shareholders’ Meeting. Such
a resolution must be adopted by at least two thirds of the
represented shares, and by the absolute majority of the
represented par value of shares.
2.7 Convertible bonds and options
Schulthess Group AG has not issued any convertible
bonds.
For compensation purposes, Schulthess Group AG implemented
an employee option plan for members of the Board
of Directors and senior management. Schulthess Group AG
holds treasury shares or OTC warrants to ensure exercise
of such options. Details of these options are described
below; there are no further options outstanding.
Outstanding options on shares of Schulthess Group AG
Number of opt. Issue date Conversion right Strike price Maturity date
12,900 March 2004 1 option : 1 registered share CHF 134.00 March 2008
5,445 March 2005 1 option : 1 registered share CHF 290.00 April 2009
2,670 March 2006 1 option : 1 registered share CHF 600.00 March 2010
If all of the options mentioned above were executed, this would represent 1.98 %
of the share capital.
3. Board of Directors
On 31 December 2006, the Schulthess Group AG Board of
Directors consisted of five members.
3.1 Members of the Board of Directors
3.2 Other activities and interests
The personal details and other activities and interests
of individual members of the Board of Directors are as
follows:
Chairman and Delegate
Rudolf Kägi
Born 1941, Swiss
Education and qualifications:
Technical draughtsman / designer
and electrical technician
Non-executive member
Member of the Board since 1995
and Chairman of the Board since
2000
Career:
Joined company in 1963 as designer, head of research and
development and member of Management from 1984 and,
from 1991, CEO of Schulthess Maschinen AG and from 1995
CEO of Schulthess Group.
Other important activities and interests:
Chairman of the Board of Directors of all Schulthess Group
AG subsidiaries
Vice-Chairman
Dr. Peter R. Isler
Born 1946, Swiss
Education and qualifications:
Dr. iur. (Doctor of Law), University of
Zurich, attorney-at-law and LL.M.
Non-executive member
With the Schulthess Group since
1998
Career:
Attorney-at-law and partner in the law firm Niederer Kraft
& Frey, Zurich
Other important activities and interests:
Bank Leu AG, member of the Board of Directors
Clariant AG, member of the Board of Directors
Zellweger Luwa AG, member of the Board of Directors

Schulthess Group Finances Corporate Governance 27
Member
Prof. Dr. Christian Belz
Born 1953, Swiss
Education and qualifications: Dr.
oec. (Doctor of Economics) University
of St. Gallen
Non-executive member
With the Schulthess Group since
1998
Career:
Professor of Business Management at the University of
St. Gallen
Managing Director of the Institute of Marketing and
Commerce
Other important activities and interests:
Jelmoli Holding AG, member of the Board of Directors
Member
Andrea Malär
Born 1947, Swiss
Education and qualifications:
Electrical and production engineer,
Biel Technical College
Non-executive member
With the Schulthess Group since
1998
Career:
MBM Management-Beratung AG, Chairman of the Board of
Directors
Other important activities and interests:
none
Member
Thomas D. Rutz
Born 1956, Swiss
Education and qualifications:
Business economist, Zurich Technical
College
Non-executive member
With the Schulthess Group since
2002
Career:
Compagnie Granière SA and Hermes-Holding AG, CEO
Other important activities and interests:
none
Independence of non-executive Directors
Rudolf Kägi was CEO of the Schulthess Group until 30 April
2006. The other four have not been members of Group
Management at Schulthess Group during the last three
years. In addition, there are no substantial business relations
between Schulthess Group AG (Holding company) or
its subsidiaries and any of the non-executive Directors.
3.3 Cross involvements
There are no cross-involvements between the Board of
Directors of Schulthess Group AG and other listed companies.
3.4 Elections, independence of non-executive Directors
The Board of Directors of Schulthess Group AG shall be
comprised of at least three to a maximum of seven members,
according to the Articles of Incorporation. They shall
be appointed by the Shareholders’ Meeting for a term of
three years and may be re-elected at the end of this period.
The elections shall take place in a staggered manner and
shall be organised in such a way, that Chairman and Vice
Chairman are never to be re-elected at the same time.
Details of elections can be seen in the following table:
Name Office Duties Member Elected
since until SM
Rudolf Kägi Chairman and CEO non-executive 1995 2007
Dr. Peter R. Isler Vice-Chairman non-executive 1998 2009
Prof. Dr. Christian Belz Member non-executive 1998 2009
Andrea Malär Member non-executive 1998 2009
Thomas D. Rutz Member non-executive 2002 2007
Dr. Peter Isler, Christian Belz and Andrea Malär were individually
re-elected at the shareholders’ meeting on 20 April
2006 for a further period of three years.
3.5 Internal Organisation
The Board of Directors has the supreme responsibility for
the strategy and the ultimate direction of the business of
Schulthess Group AG. It is the ultimate decision-making
authority and determines the guidelines for the strategy,
organisation, financial planning and accounting, to be
followed by Schulthess Group. The Board of Directors has
entrusted its Delegate with the management of the daily
operations.
The Board of Directors of Schulthess Group AG met 7 times
for regular Board meetings during the financial year 2006;
3 all-day meetings and 4 half-day meetings. The Chairman
of the Board determines the items on the agenda. In addition,
each member of the Board of Directors can request
further items to be included in the agenda. All members
of the Board of Directors receive extensive detailed information,
prior to the meetings, in order to prepare for the
items on the agenda.

Schulthess Group Finances Corporate Governance 28
Committees
The Board of Directors has established an Audit Committee
and a Compensation Committee. The chairmen were
appointed by the Board of Directors. The committees meet
regularly and their duty is to produce meeting minutes and
recommendations for the regular meetings of the Board of
Directors. The reports are presented by the Chairman in
question.
Audit Committee
The Audit Committee consists of two non-executive
members of the Board of Directors. The period of office
is 1 year, although re-election is possible. The Audit
Committee currently consists of Dr. Peter R. Isler and
Rudolf Kägi, with Dr. Peter R. Isler holding the chair. The
Audit Committee met five times in the 2006 financial
year. These meetings were also attended by the Chief
Executive Officer and the Chief Financial Officer and, when
necessary, representatives of the auditors. The Audit
Committee’s main task is to maintain a comprehensive and
efficient audit concept for the Schulthess Group. The Audit
Committee’s duties include the following with regard to
external auditing:
• Approval of the key points of the audit
• Acceptance of the audit report and any recommendations
from the auditors before the end of year accounts
(individual and group annual accounts) are distributed
for the approval of the full Board of Directors
• Suggestions to the Board of Directors on the question
of which external auditors should be submitted to the
general meeting for selection as auditor and group
accounts auditor and assessment of the performance,
fees and independence of the auditors.
Compensation Committee
The Compensation Committee consists of two non-executive
members of the Board of Directors. The period
of office is 1 year, although re-election is possible. The
Compensation Committee currently consists of Rudolf Kägi
and Andrea Malär, with Rudolf Kägi holding the chair.
The duty of the Compensation Committee is to submit to
the full Board of Directors the compensation (incl. option
programme) for members of the Board of Directors and to
set the compensation for members of management.
The Compensation Committee met once on the 2006
financial year.
3.6 Definition of responsibilities
The Board of Directors of Schulthess Group AG has issued
organisational regulations and appointed a separate Board
of Directors for each of the companies within the Holding.
The Board of Directors of Schulthess Group AG has delegated
the responsibilities for daily business operations
to the Group Management of Schulthess Group, whereby
it should be borne in mind that investment decisions
exceeding CHF 1 million must be taken by the entire Board
of Directors. All responsibilities of Group Management
are described in detail in a separate handbook on organisational
rules of procedure. The Chief Executive Officer
manages the Schulthess Group. He gives the full Board
of Directors the annual budget, individual projects and
regularly informs the Board of the business developments
in all subsidiary companies.
3.7 Information and control instruments
The Board of Directors of Schulthess Group AG has a
detailed MIS (Management Information System) at their
disposal. The Chief Financial Officer reports the important
profitability and liquidity figures directly to the members
of the Board of Directors, on a monthly basis. Consolidated
financial statements (including consolidated balance
sheet, income statement and cashflow statement) are
issued on an annual and half-year basis. All figures
are compared with the results of the previous year and
against the budget. On the basis of the monthly account,
a calculation is made, whether the budget can be reached.
The Chief Executive Officer and the Chief Financial Officer
for the business divisions check and discuss the financial
results of each subsidiary on a monthly basis. Each of
these reports is discussed at the meetings of the Board of
Directors.

Schulthess Group Finances Corporate Governance 29
4. Group Management
On 31 December 2006, Schulthess Group Management
consisted of two members.
4.1 Members of Group Management
4.2 Other activities and interests
The personal details and other activities and interests of
the two members of Group Management are as follows:
Chief Executive Officer (CEO)
Artur Rodecker
Born 1956, German
Education and qualifications:
Electrical engineer, Coburg Technical
College (Germany)
Career:
Chief Executive Officer (CEO) since
1 May 2006
Member of Group Management
since 2003
With the Schulthess Group as General Manager of Alpha-
Innotec GmbH since 2000
Founder of Alpha-Innotec GmbH in Kasendorf (Germany)
in 1998
Many years with the Siemens Group in Germany
Other important activities and interests:
none
Chief Financial Officer (CFO)
Max M. Müller
Born 1962, Swiss
Education and qualifications:
Federal diploma in accounting and
controlling
Career:
CFO and member of Group Management
since 1996
From 1982 until 1995, various
positions in finance and controlling with medium sized
companies
Other important activities and interests:
none
4.3 Management contracts
Neither Schulthess Group AG nor its subsidiaries have any
management contracts with third parties.
5. Compensation, shareholdings
and loans
5.1 Content and method of determining compensation and
shareholding programmes
The members of the Board of Directors of Schulthess Group
AG receive remuneration for their services. The Board of
Directors determines the size of this remuneration.
All members of Group Management receive a remuneration
based on results. Up to 60 % of the total remuneration is
paid on a variable basis. For the Chief Executive Officer
and the Chief Financial Officer, the variable part of the
remuneration will be based on the reported consolidated
earnings after tax (EAT). In case of the Managing Directors,
earnings before interest and tax (EBIT) of their respective
company or business division shall determine the variable
part of their remuneration.
According to the regulations for the issuance of options
on shares of Schulthess Group AG, dated December 20,
2001, the members of the Board of Directors, the members
of Group Management and further persons in leadership
positions receive options within limits, decided by the
Board of Directors. Options were allocated for the first time
in April 2002.
5.2 Compensation for acting members of governing
bodies
The total amount of compensation, which has been paid
to the executive member of the Board of Directors (until 30
April 2006) and the other members of Group Management
during financial year 2006, reached CHF 1,570,000. Additionally
shares and options have been allocated according
to 5.4 and 5.6.
The acting, non-executive members of the Board of Directors
received remuneration for their services in a total amount of
CHF 207,000 and shares (see 5.4) and options (see 5.6).
There were no additional severance payments made to
persons, who gave up their functions in a governing body
during the year under review.
5.3 Compensation for former members of governing
bodies
During financial year 2006, members of governing bodies,
who ended their function in previous reporting periods
received CHF 0.
5.4 Share allotment during the reporting period
The executive member of the Board of Directors (until 30
April 2006) and the members of Group Management were
allotted a total of 340 shares. The non-executive members
of the Board of Directors received 145 shares.
5.5 Share ownership
The members of Group Management hold in total 9,710
registered shares of Schulthess Group AG, as of 31 December
2006.

Schulthess Group Finances Corporate Governance 30
The non-executive members of the Board of Directors
(including closely linked parties) hold a total of 207,223
registered shares of Schulthess Group AG.
5.6 Options
The members of the Board of Directors of Schulthess
Group AG as well as the members of Group Management
receive a minimum of 14 %, but a maximum of 42 % of their
honorarium (for Board members) and variable compensation
(for Group Management, respectively) in form of
options or shares. The option programme was established
in April 2002. All options are vested for three years and can
be executed during the period of one year thereafter.
The following options were held as of 31 December 2006:
Member of Group Management
Number Allocation Conversion right Strike price Maturity
of options date
3,000 2004 1 option : 1 registered share CHF 134.00 March 2008
1,500 2005 1 option : 1 registered share CHF 290.00 April 2009
570 2006 1 option : 1 registered share CHF 600.00 March 2010
Non-executive members of the Board of Directors
Number Allocation Conversion right Strike price Maturity
of options date
5,900 2004 1 option : 1 registered share CHF 134.00 March 2008
2,300 2005 1 option : 1 registered share CHF 290.00 April 2009
1,335 2006 1 option : 1 registered share CHF 600.00 March 2010
5.7 Additional honorariums and remunerations
The members of the Board of Directors as well as the
members of Group Management have not received any
additional honorariums or remunerations during 2006, for
services towards Schulthess Group AG or any of its subsidiaries,
which exceeded half of the ordinary remuneration
received.
5.8 Loans granted to governing bodies
Schulthess Group AG and its subsidiaries have not granted
any loans or guarantees to the members of the Board of
Directors or to the members of Group Management.
5.9 Highest total compensation
The member of the Board of Directors with the highest
total compensation, received for his services as Board
member and as member of Group Management a total
amount of CHF 631,000.
– Number of shares allocated: 180
– Number of options allocated: 720
– Maturity date: 30 March 2010,
– conversion rate 1:1,
– strike price CHF 600.00
6. Shareholders’ participation
rights
6.1 Voting rights and representation
Each registered share with a voting right entitles to one
vote at the Shareholders’ Meeting of Schulthess Group AG.
A shareholder may, directly or indirectly, for own and
represented shares, combine only the voting rights of 5%
of the total number of shares registered in the commercial
gazette. Legal entities and groups of joint owners who are
related to one another through capital ownership, voting
rights, common management or in any other manner are
considered as one single acquirer. The same shall apply for
legal entities and groups of joint owners who act in concert,
as a syndicate or in any other manner with the intent
to evade the limitation on voting rights. These voting right
limitations do not apply for proxy of custody accounts or
governing bodies, or for independent proxy in terms of Art.
689c of the Swiss Code of Obligations. This voting right
restriction is not applicable for those shareholders, who
were already registered with more than 5% of all shares at
the time, that the Articles of Incorporation concerning the
voting rights restrictions were issued. This exception was
again made during the reported period in 2006 (please
also refer to “grandfathering” shareholders in section 2.4
“Shares” on page 25 of this annual report).
Each shareholder with the registered right to vote may be
represented by another shareholder, who is registered in
the stock ledger. Proxy of custody accounts in terms of Art.
689d of the Swiss Code of Obligations as well as proxy of
governing bodies and the independent scrutator do not
need to be shareholders.
Conditions for cancelling statutory voting rights
restrictions:
Any change of the voting rights restrictions needs a resolution
by the Shareholders’ Meeting, whereby the adoption
of at least two thirds of the represented share votes and
the absolute majority of the represented par value of
shares is required.
6.2 Statutory quorums
For resolutions concerning:
– the change from registered shares into bearer shares
– the dissolution of the Company (also as a result of a
merger)
– the change of the Articles of Incorporation on restriction
of the transferability of registered shares, the restriction
on voting rights, the statutory quorums and the dismissal
of more than one third of the members of the Board
of Directors require the adoption of at least two thirds of
the represented share votes and the absolute majority
of the represented par value of shares. Unless otherwise
provided by the law. Schulthess Group AG shall adopt

Schulthess Group Finances Corporate Governance 31
resolutions and make elections with the majority of the
share votes cast, without considering the number of
shareholders present and the represented number of
shareholder votes.
6.3 Convocation to the Shareholders’ Meeting
The convocation to the Shareholders’ Meeting and the
agenda are according to the regulations set by the law.
6.4 Agenda of the Shareholders’ Meeting
The Board of Directors shall call the Shareholders’ Meeting.
Notice of the Shareholders’ Meeting is given by way
of publication of the invitation in the Swiss Official Gazette
at least twenty days before the day of the Shareholders’
Meeting. Shareholders, who are registered in the stock
ledger, will also receive an invitation by mail. The Board
of Directors prepares the items on the agenda of the
Shareholders’ Meeting. One or more shareholders with the
registered right to vote, who own shares of the Company
representing at least CHF 100,000 of the share capital of
the Company, may request that an item be included in the
agenda before the Shareholders’ Meeting is being called.
Requests for the inclusion of specific issues and motions in
the agenda must be submitted to the Board of Directors at
least 45 days before the Shareholders‘ Meeting.
6.5 Registration in the stock ledger
During the last 10 days prior to the Shareholders’ Meeting,
no registration in the stock ledger shall be carried out.
Shareholders, who sell their shares prior to the Shareholders’
Meeting, cannot carry out their voting rights anymore.
In case of a partial sale or an additional purchase,
shareholders can exchange the delivered entry card at
the information counter on the date of the Shareholders’
Meeting.
7. Changes of control and defence
measures
7.1 Opting out clauses
There are no statutory clauses concerning Opting-out or
Opting-up (Art. 22 SESTA).
7.2 Change of control clauses
Neither the members of the Board of Directors nor the
members of Group Management have any specific contractual
agreements, which would protect them in case of an
undesirable change of control in the Company.
8. Auditors
8.1 Duration of the mandate and term of office of lead
auditor
PricewaterhouseCoopers AG, Zurich has been auditor of
Schulthess Group AG (holding company) and Schulthess
Group since 1995.
The head auditor has been responsible for the existing
auditing mandate since 2003.
8.2 Auditing honorarium
During financial year 2006, PricewaterhouseCoopers AG
charged Schulthess Group with CHF 250,000 for auditing
services in relation to the financial statements of Schulthess
Group AG (holding company) and its subsidiaries, as
well as the consolidated financial statements of Schulthess
Group.
8.3 Additional fees
In addition, PricewaterhouseCoopers AG charged Schulthess
Group with CHF 82,000 for services regarding tax and
further advice.
8.4 Supervisory and control instruments vis-à-vis the
auditors
The Audit Committee of the Board of Directors evaluates
the efficiency, honorariums and independence of the
auditors and group auditors on a yearly basis. The
Board of Directors proposes the external auditors to the
Shareholders’ Meeting. The Audit Committee examines the
scope of the external auditing, the auditing plans relevant
processes and discusses the auditing results with the
external auditors on a yearly basis.
9. Information policy
Schulthess Group AG applies an open and transparent
information policy towards its shareholders, the public
and the capital markets. Shareholders receive detailed
information about the business activities and financial
situation of Schulthess Group AG on a semi-annual basis.
After the announcement of the full year financial results in
March, a detailed annual report is published. This report
is sent to shareholders together with the invitation to the
Shareholders’ Meeting. Schulthess Group continuously
takes care of investors and has regular interviews with the
financial and daily press. The Schulthess Group website
www.schulthess-group.com is meticulously taken care of
and the Company management actively participates at
investor seminars and regularly meets larger investors on
a one-on-one basis.

Schulthess Group Finances Consolidated financial statements 33
Schulthess Group
Consolidated financial statements
Schulthess Group
Schulthess Group – the group in figures
Consolidated balance sheet 34
Consolidated income statement 35
Consolidated cash flow statement 36
Consolidated statement of changes in equity 37
Notes to the consolidated financial statements 38
General informations 38
Main accounting principles 38
Management of financial risks 43
Assessments and evaluations of accounting presentation risks 43
Segment information 44
Report of the group auditors 61

Schulthess Group Finances Consolidated balance sheet 34
Consolidated balance sheet
in CHF 1,000 Notes 31.12.2006 31.12.2005
Cash and cash equivalents 13,021 17,831
Trade receivables 6 42,566 28,917
Other receivables 7 3,005 3,311
Prepaid expenses 1,356 1,161
Inventories and long-term construction contracts 8 48,905 32,930
Current assets 108,853 50.96 % 84,150 48.34 %
Property, plant and equipment 9 74,306 64,629
Intangible assets 10 28,200 24,226
Pension assets 18 1,474 0
Deferred income tax assets 17 791 1,080
Non-currrent assets 104,771 49.04 % 89,935 51.66 %
Total assets 213,624 100 % 174,085 100 %
Financial liabilities 11 5,732 6,587
Trade payables 14,829 7,610
Current income tax liabilities 9,393 4,155
Other payables 12 13,429 10,049
Accrued expenses 13 21,093 17,104
Short-term provisions 16 2,064 2,184
Short-term liabilities 66,540 31.15 % 47,689 27.39 %
Financial loans 14 1,558 6,474
Long-term provisions 16 2,666 3,782
Deferrred income tax liabilities 17 13,337 11,382
Long-term liabilities 17,561 8.22 % 21,638 12.43 %
Total liabilities 84,101 39.37 % 69,327 39.82 %
Share capital 2,125 2,125
Capital reserves 16,307 16,210
Retained earnings 108,630 85,225
Currency translation differences 1,160 157
Capital and reserves attributable to equity holders 128,222 60.02 % 103,717 59.58 %
Minority interest in equity 1,301 1,041
Total shareholders‘ equity 19 129,523 60.63 % 104,758 60.18 %
Total shareholders‘ equity and liabilities 213,624 100 % 174,085 100 %
The notes on pages 38 to 60 are an integral part of these consolidated financial statements.

Schulthess Group Finances Consolidated income statement 35
Consolidated income statement
in CHF 1,000 Notes 2006 2005
Total Sales 5 306,602 100 % 184,536 100 %
Sales deductions 5 – 7,696 –5,379
Net Sales 5 298,906 179,157
Cost of material –126,022 –64,998
Personnel expenses 20 –80,473 –56,745
Rent expenses –2,012 –1,736
Administration expenses – 6,236 –4,601
Advertising expenses –13,209 –9,457
Other operating expenses –20,038 –12,889
Other income 3,787 1,853
Operating EBITDA 54,703 17.84 % 30 584 16.57 %
Depreciation on property, plant and equipment 9 –7,062 –5,101
Depreciation on intangible assets 10 –1,250 –622
Operating profit EBIT 46,391 15.13 % 24,861 13.47 %
Finance income 21 262 276
Finance expenses 22 – 602 –229
Financial result – net –340 47
Share of loss of associates 0 – 60
Profit before income tax 46,051 15.02 % 24,848 13.47 %
Income tax expenses 17 –13,786 –6,546
Profit for the year 32,265 10.52 % 18,302 9.92 %
Attributable to:
Equity holders of the Parent Company 31,705 17,892
Minority interest 560 410
Profit for the year 32,265 18,302
Basic earnings per share (in CHF) 23 29.85 17.05
Diluted earnings per share (in CHF) 23 29.84 16.84
For the first time income and expenses of KKT Kraus Kälte- und Klimatechnik GmbH have been included. Net sales in FY
2006 amounted to CHF 63.2 million and operating profit EBIT to CHF 6.8 million.
The notes on pages 38 to 60 are an integral part of these consolidated financial statements.

Schulthess Group Finances Consolidated cash flow statement 36
Consolidated cash flow statement
in CHF 1,000 Notes 2006 2005
Operating profit EBIT 46,391 24,861
Share-based payments 180 327
Depreciation on property, plant and equipment 7,062 5,101
Depreciation on intangible assets 1,250 622
Interest received 262 276
Interest paid – 602 –229
Income tax paid – 6,755 –5,795
Change in valuation adjustments on trade receivables –586 525
Change in valuation adjustments on inventories 428 –430
Change in provisions – 679 –462
Cash flow before changes in net current assets 46,951 24,796
Change in receivables –12,952 –3,882
Change in inventories and construction contracts –16,403 –578
Change in pension fund assets –2,031 0
Change in liabilities and accrued expenses 12,648 1,729
Cash flow from operating activities
Cash flow from investing activities
28,213 22,065
Investing in property and plant 9 – 6,542 –5,267
Divesting in property and plant 9 0 503
Investing in machinery and vehicles 9 –9,778 –7,604
Divesting in machinvery and vehicles 9 90 107
Divesting in associates 0 340
Divesting in financial assets 0 349
Investing in intangible assets 10 –2,682 –1,954
Divesting in intangible assets 10 22 0
Take-over of minority shares of Alpha-Innotec GmbH 0 –2,421
Acquisition of subsidiaries (net of cash acquired) 24 0 –17,764
Cash flow from investing activities
Cash flow from financing activities
– 18,890 –33,711
Proceeds from financial liabilities 0 5,000
Repayments of financial liabilities –855 –1,010
Proceeds from financial loans 84 5,000
Repayments of financial loans –5,000 0
Transactions with treasury shares 0 9,088
Purchase of OTC-warrants for treasury shares 0 –5,023
Dividends paid to Company‘s shareholders – 8,480 –7,145
Dividends paid to minority interests –300 –180
Cash flow from financing activities –14,551 5,730
Currency translation differences 418 12
Net change in cash and cash equivalents
Statement of cash positions:
–4,810 –5,904
Cash and cash equivalents as at 1 January 17,831 23,735
Cash and cash equivalents as at 31 December 13,021 17,831
Net change in cash and cash equivalents –4,810 –5,904
The increase of earn out of CHF 1.940 million (as part of goodwill) was a non-liquidity-related transaction.
The notes on pages 38 to 60 are an integral part of these consolidated financial statements.

Schulthess Group Finances Consolidated statement of changes in equity 37
Consolidated statement of changes in equity
in CHF 1,000
Share
capital
Capital
reserves
Treasury
shares
The notes on pages 38 to 60 are an integral part of these consolidated financial statements.
Retained
earnings
Currency
translation
differences
Equity
attributable to
share holders
Balance at 1 January 2005 2,125 11,680 –4,558 79,055 220 88,522 811 89,333
Currency translation differences –63 –63 –63
Net income/(expense) recognised directly in equity –63 –63 –63
Profit for the year 2005 17,892 17,892 410 18,302
Total recognised income and expense 17,892 –63 17,829 410 18,302
Transactions with treasury shares 4,530 4,558 9,088 9,088
Share-based payments (IFRS 2) 446 446 446
Purchase of OTC-warrants for treasury shares –5,023 –5,023 –5,023
Dividend payment – 7,145 – 7,145 –180 – 7,325
Balance at 31 December 2005 2,125 16,210 0 85,225 157 103,717 1,041 104,758
Balance at 1 January 2006 2,125 16,210 0 85,225 157 103,717 1,041 104,758
Currency translation differences 1,003 1,003 1,003
Net income/(expense) recognised directly in equity 1,003 1,003 1,003
Profit for the year 2006 31,705 31,705 560 32,265
Total recognised income and expense 31,705 1,003 32,708 560 33,268
Transactions with treasury shares 97 97 97
Share-based payments (IFRS 2) 180 180 180
Dividend payment – 8,480 – 8,480 –300 – 8,780
Balance at 31 December 2006 2,125 16,307 0 108,630 1,160 128,222 1,301 129,523
Minority
interest
Total
equity

Schulthess Group Finances Notes to the 38
consolidated financial statements
Notes to the consolidated financial statements
1. General information
The Schulthess Group‘s core activities are the development,
manufacture and marketing of products and services
of its two divisions: Heating/Cooling Technology and
Washing Technology. At 31 December 2006 the Schulthess
Group employed 1,069 personnel in Europe.
In the Heating/Cooling Technology division, the
Schulthess Group develops, manufactures and markets
heat pumps, commercial and industrial cooling systems
and controlled residential ventilation. The heat pumps
are manufactured at the Alpha-Innotec GmbH production
plant in Kasendorf, Germany. Systems and appliances
for controlled residential ventilation are manufactured at
Genvex A/S in Haderslev (Denmark). KKT Kraus Kälte- und
Klimatechnik GmbH in Lauf (Germany) is a manufacturer
of systems and appliances in the field of cooling and air
conditioning technology.
In the Washing Technology segment, the Schulthess
Group is a leading manufacturer of washing machines and
-dryers and operates in both the household market as well
as in the commercial and industrial markets. All the household
and laundry appliances marketed by this division are
developed and manufactured by Schulthess Maschinen AG
in Bubikon-Wolfhausen.
The parent or holding company, the Schulthess Group AG,
has its head office at Landstrasse 37, CH-8633 Bubikon-
Wolfhausen, Zurich (Switzerland). The Schulthess Group
AG has been listed on the Swiss Stock Exchange (SWX)
since April 1998.
The presented consolidated financial statement was
approved for publication by the Board of Directors on
6 March 2007.
2. Main accounting principles
2.1 Basis of preparation
The Schulthess Group‘s consolidated financial statement
is based on the individual financial statements of the
Group companies prepared according to uniform guide
lines. The financial statement is prepared on the historical
cost principle, unless otherwise stated in the accounting
principles set out below, and in accordance with the International
Financial Reporting Standards (IFRS) which have
been approved by the International Accounting Standards
Board (IASB) and complies with both Swiss law and the
accounting regulations of the SWX Swiss Stock Exchange‘s
listing requirements. The presented consolidated financial
statement is in Swiss Francs (CHF), i.e. the operating and
reporting currency used by the parent company and the
Group.
The following accounting principles were used consistently
for the periods in the presented consolidated financial
statements. The accounting principles have been consistently
applied by the Group companies.
Except for the following change which came into effect on
1 January 2006, all other accounting principles applied for
the 2006 consolidated financial statements were the same
as those applied at 31 December 2005:
• IAS 19 Employee Benefits (Amendment)
Basically the same accounting principles were applied as
in the previous year (see 2.16). However the notes were
revised and supplemented with additional information.
The following standards, amendments and interpretations
came into effect on 1 January 2006 but are not relevant for
Schulthess Group:
• IAS 21 Net Investment in a Foreign Operation (Amendment)
• IAS 39 Cash Flow Hedge Accounting of Forecast Intragroup
Transactions (Amendment)
• IFRS 1 First-time Adoption of International Financial
Reporting Standards (Amendment)
• IFRS 4 Insurance contracts (Amendment)
• IFRS 6 Exploration for and Evaluation of Mineral
Resources (new)
• IFRIC 4 Determining whether an Arrangement contains
a Lease (new)

Schulthess Group Finances Notes to the 39
consolidated financial statements
• IFRIC 5 Rights to Interests arising from Decommissioning,
Restoration and Environmental Rehabilitation
Funds (new)
• IFRIC 6 Liabilities arising from Participating in a Specific
Market – Waste Electrical and Electronic Equipment
(new)
The following standards, interpretations and amendments
to existing standards that have been published and that
are mandatory for accounting periods beginning on or after
1 May 2006 or later periods have not been applied by the
Schulthess Group in advance:
• IFRS 7 Financial Instruments – Disclosures (new)
• IFRS 8 Operating Segments (replaces IAS 14)
The entity has not undergone a careful analysis of the
operating segments and segment performance in the
financial statements and therefore no final assessment
of the impact on the segment presented can presently be
made.
• IFRIC 8 Scope of IFRS 2
• IFRIC 10 Interim Financial Reporting
The following standards, interpretations and amendments
to existing standards that have been published that are
mandatory for accounting periods beginning on or after
1 May 2006 or later periods but are not relevant for the
Schulthess Group:
• IFRIC 7 Applying the Restatement Approach under IAS
29, Financial Reporting in Hyperinflationary
Economies
• IFRIC 9 Reassessment of Embedded Derivatives
2.2 Balance sheet date
The balance sheet date for the Schulthess Group, all group
companies and the consolidated financial statements is 31
December.
2.3 Group companies
As at 31 December the Schulthess Group AG held participations
in the following companies:
There were no changes in the group companies in the
financial year 2006.
For the first time all expenditure and income (result) of KKT
Kraus Kälte- und Klimatechnik GmbH as well as KKT Kraus
Industriekühlung GmbH were included. The assets and
liabilities of both these companies were included for the
first time at 31 December 2005.
2.4 Consolidation method
Companies which the Schulthess Group AG controls
financially and operatively and in which the Group holds
a direct or indirect interest of more than 50% are fully
consolidated.
In the case of associated companies in which the Schulthess
Group has decisive influence but does not have
control and holds an interest of between 20% and 50% are
consolidated according to the equity method.
Participations of less than 20% are included at present fair
value.
The capital is consolidated according to the purchase
method.
2.5 Intercompany transactions
All assets, liabilities and transactions between Group
companies are eliminated.
2.6 Translation of foreign currencies
The reporting currency is the Swiss Franc (CHF). The items
disclosed in the financial statements of the individual
Group companies are stated in the currency of the
economic area in which the company is primarily active
(functional currency).
Company Nominal capital Percentage held
2006 2005
Schulthess Group AG, CH-Bubikon CHF 2,125,000 Parent company
Schulthess Maschinen AG, CH-Bubikon CHF 1,500,000 100 % 100 %
Merker AG, CH-Dällikon CHF 500,000 100 % 100 %
Novelan AG, CH-Dällikon CHF 1,250,000 100 % 100 %
Wamatec SA, CH-Lamone CHF 100,000 100 % 100 %
Schulthess Maschinen GmbH, AT-Wien EUR 500,000 100 % 100 %
Alpha-Innotec GmbH, DE-Kasendorf EUR 500,000 100 % 100 %
Novelan GmbH, DE-Kasendorf EUR 25,000 100 % 100 %
Calmotherm AG, CH-Altishofen CHF 250,000 70 % 70 %
Genvex A/S, DK-Haderslev DKK 2,000,000 100 % 100 %
KKT Kraus Kälte- und Klimatechnik GmbH, DE-Lauf EUR 250,000 100 % 100 %
KKT Kraus Industriekühlung GmbH, DE-Lauf EUR 100,000 100 % 100 %

Schulthess Group Finances Notes to the 40
consolidated financial statements
Transactions in foreign currencies are translated into the
reporting currency at the exchange rate applicable on the
date of the transaction. Foreign currency gains and losses
resulting from such transactions or the translation of
financial assets and liabilities from foreign currencies are
disclosed in the income statement.
Assets and liabilities of Group companies which are shown
in currencies other than the Swiss Franc are translated at
the exchange rate applicable at balance sheet date. Income,
expenses, cash flows, cash drains and other income
statement items are translated at the average exchange
rate for the reporting period. Translation differences are
disclosed under shareholders’ equity and do not affect net
profit.
Year-end and average exchange rates:
Balance sheet Income statement
Year-end rates Average rates
Currency 31.12.06 31.12.05 2006 2005
1 EUR 1.610 1.555 1.5733 1.5485
100 DKK 21.50 20.85 21.10 20.79
2.7 Cash and cash equivalents
This comprises cash and cash equivalents including cash
convertible investments, which can be turned into cash
with an initial time period of maximum three months.
2.8 Financial activities for trading purposes
Following their initial valuation, financial assets available
for sale are disclosed at their current value. Valuation
gains or losses to current value are included in the result
of the period in which they occurred.
2.9 Trade receivables
Trade accounts receivable are initially stated at the
appropriate current value and then valued subsequently
at ongoing historical cost after deduction of the valuation
adjustment. Valuation adjustments against trade accounts
receivable are made when objective indications exist that
the amounts owing cannot be recovered in full. The extent
of the valuation adjustment is the difference between
the book value of the receivable and the expected cash
flow. The valuation adjustment is disclosed in the income
statements.
2.10 Inventories and long-term construction contracts
Inventories are valued at the lower of the weighted average
cost method or net realizable value.
Semi-manufactured and finished products are valued at
manufacturing cost on the basis of progress made. The
manufacturing costs include the direct material and labour
costs as well as the relevant proportional overheads. Valuation
adjustments are made for non-realizable items.
As long as income and expenditure in connection with
long-term construction contracts can be reliably
assessed, then the resulting turnover can be captured in
accordance with the Percentage-of-Completion-Method.
This means that income and expenditure will be captured
in the income statement based on the degree of completion.
The degree of completion will be determined by the
Cost-to-Cost-Method, which means that the degree of
completion can be calculated by comparing the accumulated
actual project costs at a given time with the estimate
total cost of the project. Foreseeable losses on long-term
construction contracts can immediately be charged to the
income statement.
2.11 Non-current assets
Non-current assets are shown at cost less accumulated
depreciation and possible valuation losses. Cost is depreciated
on the straight-line method over their estimated
economic life. The depreciation rates are as follows:
Property none
Plant 25 years
Fixed installations 15 years
Production equipment and machinery 10 years
Specialized tools 5 years
IT equipment 5 years
Trucks 10 years
Service vehicles 5 years
Costs of maintenance and repairs as well as low-value
items are charged directly as expenditure to the income
statement. Any financing costs relating to non-current
assets under construction are charged directly to the
income statement.
Any renovation work increasing the value and lengthening
of the useful life of non-current assets is capitalized.
All gains and losses from the sale of non-current assets are
charged to the income statement.

Schulthess Group Finances Notes to the 41
consolidated financial statements
2.12 Intangible assets
Acquired intangible assets that represent a future economic
benefit, such as acquired software, licenses, patents
and similar rights, are shown at cost and are depreciated
by the straight-line method over their useful lives of 3 to 5
years.
Acquired customer lists are depreciated by the straightline
method over 10 years. Acquired trade marks are not
depreciated but checked annually for impairment.
Development costs are only shown as intangible assets
to the extent that they comply with specific accounting
criteria (IAS 38) and the capitalized amount is considered
to be realizable as a result of future economic benefits.
Development costs are shown at cost and depreciated by
the straight-line method over its useful life of 5 to 7 years.
The costs include primarily material and labour costs but
not the cost of third-party funds. Depreciation commences
with the utilization of the asset.
All research costs are charged directly as expenditure in
the income statement.
Goodwill – the difference between the cost of acquisition
and the fair value of the acquired net assets – is disclosed
in the balance sheet and is checked annually for impairment.
2.13 Impairment of assets
Assets with a limited useful life are checked at balance
sheet date for impairment. If there is any indication of a
long-term decrease in value, impairment tests are carried
out to calculate the realizable value of the assets.
Goodwill and other intangible assets with an unlimited
useful life as well as unused intangible assets are checked
for impairment annually. The impairment test for the
income generating asset in question is performed using
the discounted cash flow method.
If the book value exceeds realizable value, the necessary
valuation adjustment is made and charged to the income
statement.
2.14 Financial liabilities and financial loans
Initially financial liabilities and financial loans are stated
at their fair value after deduction of transaction costs. In
following years, they are valued at ongoing costs.
Financial liabilities are classified as short-term liabilities
since they are due within twelve months of the balance
sheet date. Financial loans run more than 12 months and
are therefore classified as long-term.
2.15 Trade payables
Trade accounts payable and other liabilities are shown at
cost.
2.16 Staff pension obligations
The Schulthess Group runs a number of occupational
pension plans that are adapted to local requirements in
the various countries.
All Swiss Group companies either have their own legally
independent pension fund or belong to collective schemes
with insurance companies. A pension agreement was
concluded directly with an insurance company on behalf of
a foreign Group company.
The pension funds are financed by contributions from
employers and employees. These pension and retirement
benefits in accordance with IAS 19 (Employee benefits) are
defined benefit plans. The implications of the calculation
of pension entitlement in accordance with IAS 19 are
disclosed in the notes to the financial statements. In accordance
with IAS 19, actuarial gains and losses are recorded
using the corridor approach. According to the corridor
approach, the accumulated unrecognized actuarial gains
and losses which exceed 10% of the greater of the present
value of the defined benefit obligation or the fair value of
the existing plan assets is divided by the expected average
remaining working life of the employees participating in
the plan and recognized as income or expense. Otherwise
no actuarial gain or loss is stated.
2.17 Current income tax liabilities
Current income tax is based on the taxable income of the
current financial year and is accrued as expenditure.
2.18 Deferred income tax liabilities
Deferred income tax is determined by the liability method
using the legally applicable income tax rates on all
valuation differences. Tax savings due to tax losses carried
forward to be offset against future taxable income and
other deferred tax credits are disclosed only to the extent
that it is probable that future taxable income will be available
against which the deductible temporary differences
can be utilized.
2.19 Provisions
A provision is only disclosed if the company has a current
(legal or de facto) liability in respect of a past event and
it is probable the discharge of the liability will result in an
outflow of resources and a reliable estimate of the amount
of the liability has been made. If no provision could be
made because one of the above criteria was not met, a
corresponding contingent liability must be disclosed.
Provisions are checked at each balance sheet date and
adjusted to the current best estimate. If the corresponding
interest rate effect is significant then the amount of the
provision corresponds to the cash value necessary in order
to discharge the liability. In the event of discounting, the

Schulthess Group Finances Notes to the 42
consolidated financial statements
increase in the provision over time is treated as interest
expenditure. If it is expected that the expenditure in respect
of the discharge of a liability against which a provision
has been made will be reimbursed by a third party, then
this reimbursement is recorded only when it is practically
certain that the Group will receive the reimbursement.
2.20 Financial leasing and operating leasing
Leasing agreements in which the Schulthess Group in the
main assumes most or all of the risks and opportunities as
owner of the property are categorized as financial leases.
Assets used by the owner that are acquired within the
framework of a financial leasing agreement are assigned a
value corresponding to their fair value or, if lower, the cash
value of the minimum leasing payments since commencement
of the lease minus accumulated depreciation and
expenditure associated with loss of value.
A leasing agreement is categorized as operating leasing if
in the main most or all the risks and opportunities associated
with the property remain with the lessor. Leasing payments
made within the framework of an operating leasing
agreement are recorded on the straight-line method
throughout the duration of the leasing agreement.
2.21 Treasury shares
Treasury shares are shown at cost and are setoff against
shareholders‘ equity.
2.22 Earnings per share (EPS)
The undiluted earnings per share are determined by dividing
the profit, after deducting minority shareholdings, by
the weighted average number of shares circulating during
the reporting period. The diluted earnings per share also
include all potential dilution effects.
2.23 Recording of sales revenue and income
Sales revenue consists of all sales of goods and services
less deductions such as rebates, quantity discounts, cash
discounts as well as value added tax and commissions.
They are recorded at the time of transfer of utilization and
risk. Services are recorded when they are provided. At the
end of the current financial year, the service subscriptions
for the following year are invoiced to customers and
accrued as a liability.
Revenue from long-term construction contracts is recorded
in accordance with the Percentage-of-Completion-Method.
2.24 Share-based payments
Compensation resulting from the option plan is recorded
as expenditure at grant date.
2.25 Derivate financial instruments
The Schulthess Group does not make use of derivative
financial instruments as hedge against foreign exchange
and interest rate risks.
2.26 Dividends
Dividends are recorded as liabilities in the period when
they were declared.
2.27 Segments
The Schulthess Group is active in two business segments
according to its organizational structure. In the primary
segment – subdivided into Heating/Cooling Technology
and Washing Technology – the Schulthess Group is
involved in the development, production, marketing and
servicing of heat pumps and refrigeration products and
washing machines. In the secondary segment, the key
figures are presented from a geographical point of view.
The costs accruing in the Schulthess Group AG (holding
company) are stated under Corporate. These refer to both
segments.
2.28 Transactions with minority shareholders
Transactions with minorities are treated like transactions
with own shareholders. Purchases and sales of minority
shares are booked under share equity. Possible differences
to the disclosed minority shares are booked against reserves
(economic entity model).

Schulthess Group Finances Notes to the 43
consolidated financial statements
3. Management of financial risks
Risk policy
The Schulthess Group is exposed to various risks,
which are primarily related to currency and interest rate
fluctuations. Management regularly monitors these risks.
Wherever possible, the shortest available term is chosen
for bank financing. Foreign currencies are held for future
requirements. The Schulthess Group does not engage in
any derivative financial instruments to hedge against such
risks.
Furthermore the Group‘s risk management policy also
includes risk coverage based on a comprehensive, efficient
insurance protection.
Liquidity risk
The Group‘s financial management ensures that companies
in the Schulthess Group always have access to optimum
liquidity. Cash and cash equivalents are invested on a
short-term basis. Sufficient credit-lines are available from
Swiss banks to bridge any short-term liquidity shortages.
Interest rate risk
Contracting of bank financing and the connected interest
rate conditions are administered centrally. Interest rates
for both short-term and long-term bank loans are fixed at
the conclusion of the transaction.
Foreign currency risk
The Schulthess Group only operates in Europe, primarily
in Western and Central Europe. It only operates in the
currencies CHF, EUR and DKK. Exchange rate fluctuations,
in particular concerning the EUR, could affect the disclosed
net assets.
Credit failure risk
The Schulthess Group is susceptible to financial losses if
a business associate is unable or unwilling to honour its
obligations.
Cash and cash equivalents are held mainly in the form of
current accounts or short-term deposits with Swiss banks.
Receivables for goods and services are continuously monitored
at local level as well as via the Group‘s management
reporting. Credit risks are minimised because of a broad
customer base.
4. Assessments and evaluations of
accounting presentation risks
Group Management has discussed the development and
disclosure of critical presentation methods. This evaluation
is based on experience and other factors, such as expectations
of future events, that appear appropriate under the
present circumstances.
The value of acquired goodwill is verified every year.
Any loss in value is charged directly to the consolidated
income statement.
If the estimated pre-tax discount rate (WACC) applied
to the discounted cash flows had been 10 % higher than
management‘s estimates (for example 9.35 % instead
of 8.5 %), the Schulthess Group would still not have to
recognise an impairment against goodwill.
The accrual of deferred income tax for offsetting losses
carried forward in future is based, on the one hand, on the
positive financial result achieved in 2006 and, on the other
hand, on the budget and medium-term planning.

Schulthess Group Finances Notes to the 44
consolidated financial statements
5. Segment Information
5.1 Primary reporting format: business segments
5.1.1 Income Statement
in CHF 1,000 Heating/Cooling Tech. Washing Technology Corporate 1)
Elimination 2)
Total
2006 2005 2006 2005 2006 2005 2006 2005
Total segment net sales 179,253 61,882 119,653 117,275 0 0 298,906 179,157
Inter-segment sales 494 311 3,948 2,271 –4,442 –2,582 0 0
Total Net Sales 179,747 62,193 123,601 119,546 –4,442 –2,582 298,906 179,157
Depreciation on property, plant and equipment 2,839 974 5,196 4,280 0 0 8,035 5,254
Impairment of property, plant and equipment 0 0 277 469 0 0 277 469
Non-cash expenses (income) 403 663 –470 –1,030 –770 0 –837 –367
Operating profit EBIT 30,417 9,712 16,817 16,123 –843 –974 46,391 24,861
Share of loss of associates 0 0 0 –60 0 –60
Financial result –340 47
Profit before income tax 46,051 24,848
Income tax expenses –13,786 –6,546
Profit for the year 32,265 18,302
5.1.2 Balance sheet
in CHF 1,000 Heating/Cooling Tech. Washing Technology Corporate Total
31.12.06 31.12.05 31.12.06 31.12.05 31.12.06 31.12.05 31.12.06 31.12.05
Assets 110,140 70,469 98,573 94,972 4,911 8,644 213,624 174,085
Liabilities –32,060 –20,706 –34,312 –32,942 –17,729 –15,679 –84,101 –69,327
Net assets 78,080 49,763 64,261 62,030 –12,818 –7,035 129,523 104,758
5.1.3 Capital expenditure (CAPEX)
in CHF 1,000 Heating/Cooling Tech. Washing Technology Corporate Total
2006 2005 2006 2005 2006 2005 2006 2005
Total 11,475 4,064 7,527 10,761 0 0 19,002 14,825
5.1.4 Expense for Research & Development
in CHF 1,000 Heating/Cooling Tech. Washing Technology Corporate Total
2006 2005 2006 2005 2006 2005 2006 2005
Total 1,354 761 2,805 2,471 0 0 4,159 3,232
1) Mainly costs of the parent company
2) Inter-segment transactions are valued at market conditions.

Schulthess Group Finances Notes to the 45
consolidated financial statements
5.2.4 Analysis of sales by category
5.2 Secondary reporting format: geographical segments
5.2.1 Sales; based on the country the customer is located
in CHF 1,000 2006 2005
Switzerland 148,091 135,658
Germany 118,395 23,400
Austria 14,897 10,086
Denmark 8,316 5,977
Other European countries 16,903 9,415
Total 306,602 184,536
5.2.2 Total assets; based on where the assets are located
in CHF 1,000 31.12.06 31.12.05
Switzerland 111,645 109,279
Germany 88,884 52,330
Austria 2,517 2,903
Denmark 10,578 9,573
Total 213,624 174,085
5.2.3 Capital expenditure (CAPEX); based on where the assets are
located
in CHF 1,000 2006 2005
Switzerland 7,737 10,778
Germany 10,404 1,237
Austria 20 31
Denmark 841 2,779
Total 19,002 14,825
Heating/Cooling Tech. Washing Technology Total
2006 2005 2006 2005 2006 2005
Sales of goods 177,249 62,955 77,083 75,245 254,332 138,200
Revenue from services 6,992 1,065 45,278 45,271 52,270 46,336
Total Sales 184,241 64,020 122,361 120,516 306,602 184,536
Sales deductions –4,988 –2,138 –2,708 –3,241 –7,696 –5,379
Net Sales 179,253 61,882 119,653 117,275 298,906 179,157

Schulthess Group Finances Notes to the 46
consolidated financial statements
6. Trade receivables
in CHF 1,000 31.12.06 31.12.05
Gross amount 43,358 30,295
Less: value adjustments of receivables –792 –1,378
Total 42,566 28,917
The book value corresponds to the fair value.
Amount of impairment charged to income statement
under position „sales deductions“
7. Other receivables
–586 525
in CHF 1,000 31.12.06 31.12.05
Prepayments 497 458
Other receivables 2,508 1,655
Receivables from staff pension fund Schulthess
Group AG
0 1,198
Total 3,005 3,311
The book value corresponds to the fair value.
8. Inventories and long-term construction
contracts
in CHF 1,000 31.12.06 31.12.05
Raw material 18,023 10,739
Work in progress 10,905 7,473
Finished goods 15,538 10,620
Service parts 9,237 9,560
Long-term construction contracts (PoC) 1,092 0
Gross amount 54,795 38,392
Less: value adjustments for obsolete inventories –5,890 –5,462
Total 48,905 32,930
Amount of value adjustments to inventories
charged to income statement under position
„cost of material“
428 –430
Pledged inventories 0 0
Details of long-term construction contracts (PoC)
in CHF 1,000 31.12.06 31.12.05
Revenues from long-term construction contracts
(PoC)
14,915 0
Accrued contract costs and recognized profit 4,994 0
Progress billings (Prepayments) –3,902 0
Contracts in process net (PoC) 1,092 0
Contracts in process due from customers (asset) 1,092 0
Contracts in process due to customers (liability) 0 0
Contracts in process net (PoC) 1,092 0
Advances received from customers (PoC) 124 0
Retentions 0 0

Schulthess Group Finances Notes to the 47
consolidated financial statements
9. Property, plant and equipment
in CHF 1,000 Land Buildings Machinery,
Vehicles
Gross book value at 1 January 2005 13,555 29,263 49,669 92,487
Acquisition of subsidiary 0 0 6,682 6,682
Additions 2,052 3,215 7,604 12,871
Disposals – 412 – 91 – 531 – 1,034
Currency translation differences 3 23 25 51
Gross book value at 31 December 2005 15,198 32,410 63,449 111,057
Accumulated depreciation at 1 January 2005 0 1,262 37,175 38,437
Acquisition of subsidiary 0 0 3,301 3,301
Depreciation charge 0 1,256 3,376 4,632
Impairment 0 469 0 469
Disposals 0 0 – 424 – 424
Currency translation differences 0 2 11 13
Accumulated depreciation at 31 December 2005 0 2,989 43,439 46,428
Net book value at 31 December 2005 15,198 29,421 20,010 64,629
Gross book value at 1 January 2006 15,198 32,410 63,449 111,057
Additions 1,971 4,571 9,778 16,320
Disposals 0 0 –1,642 –1,642
Currency translation differences 75 257 424 756
Gross book value at 31 December 2006 17,244 37,238 72,009 126,491
Accumulated depreciation at 1 January 2006 0 2,989 43,439 46,428
Depreciation charge 0 1,269 5,516 6,785
Impairment * 0 277 0 277
Disposals 0 0 –1,552 –1,552
Currency translation differences 0 19 228 247
Accumulated depreciation at 31 December 2006 0 4,554 47,631 52,185
Net book value at 31 December 2006 17,244 32,684 24,378 74,306
* Because a tenant prematurely ended his rental agreement, an impairment of CHF 0.277 million had to be made. The basis for the calculation of the
impairment was the value in use method. The cash value of future rental payments was calculated. Because the building will be demolished at the
termination of the rental agreement, rental payments for the next 3 years were considered. The amount of CHF 0.277 million was allocated to the
segment Washing technology.
Total

Schulthess Group Finances Notes to the 48
consolidated financial statements
Further information to property, plant and equipment
in CHF 1,000 31.12.06 31.12.05
Pledged assets under restriction of ownership
Secured land and buildings
– Book value 0 0
– Secured amount 0 0
– Amount drawn 0 0
Prepayments for machinery and vehicles 4,449 2,173
Net book value for machinery und vehicles in finance lease 353 346
Amount for contractual liabilities for the acquisition of
nun-current assets
4,126 1,237

Schulthess Group Finances Notes to the 49
consolidated financial statements
10. Intangible assets
in CHF 1,000 Acquired
intangible assets
Acquired
development
costs
Generated
development
costs
Goodwill Total
Gross book value at 1 January 2005 3,851 865 1,611 6,426 12,753
Acquisition of subsidiary 96 0 0 14,348 14,444
Additions 172 72 1,710 104 2,058
Disposals – 91 0 0 0 – 91
Change in provisions of earn out 0 0 0 – 1,033 – 1,033
Currency translation differences 10 0 0 0 10
Gross book value at 31 December 2005 4,038 937 3,321 19,845 28,141
Accumulated depreciation at 1 January 2005 1,666 568 40 1,095 3,369
Acquisition of subsidiary 11 0 0 0 11
Depreciation charge 298 109 215 0 622
Disposals – 91 0 0 0 – 91
Currency translation differences 4 0 0 0 4
Accumulated depreciation at 31 December 2005 1,888 677 255 1,095 3,915
Net book value at 31 December 2005 2,150 260 3,066 18,750 24,226
Gross book value at 1 January 2006 4,038 937 3,321 19,845 28,141
Purchase Price Allocation KKT Kraus; IFRS 3 7,223 0 0 – 6,791 432
Additions 326 285 2,071 0 2,682
Disposals –5 0 –36 0 –41
Change in provisions of earn out 0 0 0 2,073 2,073
Currency translation differences 40 0 58 0 98
Gross book value at 31 December 2006 11,622 1,222 5,414 15,127 33,385
Accumulated depreciation at 1 January 2006 1,888 677 255 1,095 3,915
Depreciation charge 365 159 726 0 1,250
Disposals –11 0 – 8 0 –19
Currency translation differences 30 0 9 0 39
Accumulated depreciation at 31 December 2006 2,272 836 982 1,095 5,185
Net book value at 31 December 2006 9,350 386 4,432 14,032 28,200
The generated development costs not yet used as assets were CHF 0.915 million as per 31 December 2006 (2005: CHF 1.361 million).
The acquired trade marks with indefinite useful lives amounts to CHF 7.563 million (2005: CHF 1.421 million).

Schulthess Group Finances Notes to the 50
consolidated financial statements
Impairment test for goodwill
The impairment test for goodwill was made in December 2006 for the financial year 2006. The same procedure was followed for the acquired trade marks of
Genvex A/S and KKT Kraus Kälte- und Klimatechnik GmbH.
The value-in-use for goodwill is based on the following essential assumptions:
Cash-generating unit (CGU) Book value
of goodwill
Currency Gross
Margin
Growth
rate
Discount rate
(WACC)
Projection
period
Novelan AG 605 CHF 40 % 14 % 9 % 5 years
Calmotherm AG 260 CHF 29 % 15 % 9 % 5 years
Alpha-Innotec GmbH 2,724 EUR 45 % 25 % 8.5 % 5 years
Genvex A/S 946 DKK 51 % 20 % 8.5 % 5 years
KKT Kraus Kälte- und Klimatechnik GmbH 9,497 EUR 44 % 10 % 8.5 % 5 years
Total in CHF 1,000 14,032
Goodwill-values allocated to the segments as follows:
in CHF 1,000 Washing Technology Heating/Cooling Technology Total
31.12.06 31.12.05 31.12.06 31.12.05 31.12.06 31.12.05
Switzerland 305 305 560 560 865 865
Germany 0 0 12,221 17,072 12,221 17,072
Denmark 0 0 946 813 946 813
Total 305 305 13,727 18,445 14,032 18,750
The book value of the purchased goodwill at 31 December 2006
amounts to CHF 14.032 million (2005: CHF 18.750 million). This was
allocated to the cash generating units. The target amount for a cash
generating unit is based on a value-in-use calculation. The cashflow
projection is based on a medium-term plan covering a 5 year period
laid down by management and approved by the board of directors.
The cashflows expected in this period, were extrapolated based on
the growth rates shown above. These growth rates are in line with
past experience for the expected long-term average growth in the
corresponding business segment. The gross profit margin laid down by
management is based on past experience.
The applied discount rate (WACC) is before tax.
Based on the impairment test there was no need for impairment in
2006.

Schulthess Group Finances Notes to the 51
consolidated financial statements
11. Financial liabilities
in CHF 1,000 31.12.06 31.12.05
Short-term bank overdrafts 732 1,587
Fixed bank advance; Period: 23.12.05–23.12.07,
interest rate: 2.25 % p.a.
Fixed bank advance; Period: 23.12.05–23.12.06,
interest rate: 1.95 % p.a.
5,000 0
0 5,000
Total 5,732 6,587
The book value is approximately the market value.
No assets are pleged as security for these borrowings.
12. Other payables
in CHF 1,000 31.12.06 31.12.05
Tax (without income tax) 2,440 2,152
Social security payments 390 850
Prepayments from customers 5,417 4,933
Leasing liabilities 355 346
Earn out payment for acquisitions 2,740 0
Other liabilities 2,087 1,768
Total 13,429 10,049
13. Accrued expenses
in CHF 1,000 31.12.06 31.12.05
Revenue from services concerning following year 9,087 8,871
Revenue reimbursement to customers 218 227
Personnel: vacation, overtime etc. 9,823 6,635
Other accrued expenses 1,965 1,371
Total 21,093 17,104
14. Financial loans
in CHF 1,000 31.12.06 31.12.05
Bank loan 1,558 1,474
Fixed bank loan; Period: 23.12.05–23.12.07,
interest rate: 2.25 % p.a.
0 5,000
Total 1,558 6,474
The book value is approximately the market value.
No assets are pledged as security for this loan.
15. Leasing-liabilities
Leasing-liabilities at 31 December 2006:
in CHF 1,000
Due in financial year
Operating-
Leasing
Finance-
Leasing
2007 280 131
2008 199 174
2009 97 29
2010 75 21
later 22 –
Total 673 355
Deduction of financing expenses –2
Total without financing expenses 353
Previous year 539 346
Operating-Leasing contracts of Schulthess Group are mainly for vehicles
only. Contract period is maximum 5 years.
Operating leasing charged to income statement 2006 were CHF 0.329
million (2005: CHF 0.631million).
Finance-Leasing contracts are only for vehicles.

Schulthess Group Finances Notes to the 52
consolidated financial statements
16. Provisions
in CHF 1,000 Warranty Earn out payments
for acquisition
of subsidiaries
Long-term
provisions for
personnel
Balance at 1 January 2005 4,080 1,306 911 6,297
Acquisition of subsidiaries 364 800 0 1,164
Creation 3,214 0 0 3,214
Utilisation – 3,442 – 33 0 – 3,475
Dissolution – 105 – 1,033 – 104 – 1,242
Currency translation differences 8 0 0 8
Balance at 31 December 2005 4,119 1,040 807 5,966
Thereof short-term 2,184 0 0 2,184
Thereof long-term 1,935 1,040 807 3,782
Balance at 1 January 2006 4,119 1,040 807 5,966
Creation 3,202 1,970 0 5,172
Utilisation –3,180 0 0 –3,180
Dissolution 0 –2,740 –557 –3,297
Currency translation differences 69 0 0 69
Balance at 31 December 2006 4,210 270 250 4,730
Thereof short-term 2,064 0 0 2,064
Thereof long-term 2,146 270 250 2,666
The Schulthess Group grants a warranty on its products as a rule for 2 years. During this period products are repaired or
replaced free of charge. The provision is calculated on actual costs for warranty and replacement in relation to the sales
achieved.
The medium-term plan forms the basis for earn out payment for acquisitions of subsidiaries. This applies only to Genvex
A/S and KKT Kraus Kälte- und Klimatechnik GmbH.
The final earn out payment for KKT Kraus Kälte- und Klimatechnik GmbH amounts to CHF 2.740 million and is shown under
the position 12. „Other payables“.
The remaining amount (CHF 0.270 million) is provided for Genvex A/S.
Total

Schulthess Group Finances Notes to the 53
consolidated financial statements
17. Tax
in CHF 1,000 2006 2005
Current tax 11,993 6,464
Change in deferred income tax 1,793 82
Total income tax expense 13,786 6,546
Transitions of income tax expense
Profit before income tax 46,051 24,848
Average weighted group tax rate 30,47 % 27,59 %
Income tax calculated at group tax rate 14,030 6,856
+/- effect:
Expenses not deductible for tax purposes 5 538
Utilisation of previously not capilalized tax losses –2 – 714
Income not subject to tax –256 – 32
Previous years and other items 9 – 102
Total income tax expense 13,786 6,546
in % of profit before income tax 29.94 % 26.34 %
Composition of deferred income tax
Proof according to balance sheet items
in CHF 1,000
31.12.2006
Assets
31.12.2006
Liabilities
31.12.2005
Assets
31.12.2005
Liabilities
Losses carried foward 735 0 901 0
Trade receivables 0 390 0 300
Inventories 0 1,423 0 1,147
Non-current assets 0 10,386 0 9,026
Liabilities and provisions 56 1,138 179 909
Total 791 13,337 1,080 11,382
On valuation differences on participations (2006: CHF 32.8 million, 2005: CHF 16.8 million) no deferred taxes were recorded.
Change in deferred income tax
in CHF 1,000 2006
Assets
2006
Liabilities
2005
Assets
2005
Liabilities
Balance at 1 January 1,080 11,382 381 10,331
Acquisition of subsidiary 0 0 0 270
Creation; as per IFRS 3 – PPA KKT Kraus GmbH 0 432 0 0
Creation 0 1,914 720 969
Utilisation –295 – 416 – 23 – 190
Currency translation differences 6 25 2 2
Balance at 31 December 791 13,337 1,080 11,382
Capitalized gross amount of tax losses carried foward of
subsidiaries, which incurred losses in the last two years 3,346 3,367

Schulthess Group Finances Notes to the 54
consolidated financial statements
18. Employee benefits
18.1 Status of pension funds
in CHF 1,000 31.12.2006 31.12.2005
Present value of funded obligations 90,833 82,322
Fair value of plan assets –86,110 – 82,878
4,723 – 556
Unrecognised actuarial gains / (losses) – 6,197 1,113
Pension fund (assets) / liabilities in the balance sheet –1,474 557
18.2 Pension fund expense for the year
2006 2005
Current service costs 1,926 2,228
Interest expense 2,676 2,667
Expected income from plan assets –2,900 – 2,609
Actuarial (gains) –1,237 0
Total pension fund expense for the year 465 2,286
Actual income from plan assets 5,440 6,381
18.3 Development of the defined benefit plan liability
2006 2005
Balance at 1 January 82,322 76,194
Current service costs 1,926 2,228
Interest expense 2,676 2,667
Contributions by plan participants 2,295 1,966
Actuarial losses 8,612 2,005
Benefit payments – 6,998 –2,738
Balance at 31 December 90,833 82,322
18.4 Development of the fair value of plan assets
2006 2005
Balance at 1 January 82,878 74,553
Expected income on plan assets 2,900 2,609
Actuarial gains 2,540 4,098
Employer contributions 2,495 2,390
Employee contributions 2,295 1,966
Benefit payments –6,998 –2,738
Balance at 31 December 86,110 82,878

Schulthess Group Finances Notes to the 55
consolidated financial statements
18.5 Composition of plan assets
2006 in % 2005 in %
Equity 14,420 17 % 14,390 17 %
Debt 68,130 79 % 65,090 79 %
Other 3,560 4 % 3,398 4 %
Total 86,110 100 % 82,878 100 %
18.6 Weighted actuarial assumptions
31.12.2006 31.12.2005
Annual discount rate 3.25 % 3.50 %
Long-term expected income from plan assets 3.50 % 3.50 %
Future annual salary increases 1.50 % 1.50 %
Future annual pension increases 0.50 % 0.50 %
Average life expectancy of males at pension date 17.56 years 17,56 years
Average life expectancy of females at pension date 21.15 years 21.15 years
The long-term expected annual income is based on the following assumptions:
Equity: 6 %
Debt: 3 %
Other: 4 %
18.7 Other disclosures
31.12.2006 31.12.2005
Adjustments from experience on plan liabilities 4,542 –4,116
Adjustments from experience on plan assets 2,540 4,097
18.8 Pension expense
2006 2005
Defined contribution plan pension expense 835 249

Schulthess Group Finances Notes to the 56
consolidated financial statements
19. Shareholders‘ equity
Equity categories are defined as follows:
• Share capital is the share capital of the parent company Schulthess
Group AG.
• Capital reserves are premiums from capital increases by the
Schulthess Group AG as well as profits/losses out from sales of own
shares.
• Treasury shares are own shares bought back by Schulthess Group
AG through the Stock Exchange at market price.
• Retained earnings are all retained profits of group companies and all
other reserves.
Development of share capital
Issued shares of CHF 2.00 par value and nominal value
of shares in CHF 1,000
Issued
shares
(number)
The share capital is made up of 1,062,500 registered shares with a
nominal value of CHF 2.00 fully paid up. Each registered share with
voting rights entitles one vote.
There exists neither approved nor conditional share capital. Profits from
the parent company as well as the subsidiaries can only be distributed
after taking into account the maximum legal and statutory requirements
for the transfer to legal reserves.
In financial year 2006 non distributable reserves amount to CHF 3.8
million (2005: CHF 2.8 million).
Sharecapital
(in CHF 1,000)
Treasury shares
(number)
Treasury shares
(in CHF 1,000)
Circulated shares
(number)
Circulated shares
(in CHF 1,000)
Balance at 1 January 2005 1,062,500 2,125 – 41,839 – 84 1,020,661 2,041
Treasury shares purchased 0 0 – 7,686 – 15 – 7,686 – 15
Treasury shares sold 0 0 49,525 99 49,525 99
Balance at 31 Decmeber 2005 1,062,500 2,125 0 0 1,062,500 2,125
Balance at 1 January 2006 1,062,500 2,125 0 0 1,062,500 2,125
Treasury shares purchased 0 0 –2,310 –5 –2 310 –5
Treasury shares sold 0 0 2,310 5 2,310 5
Balance at 31 December 2006 1,062,500 2,125 0 0 1,062,500 2,125

Schulthess Group Finances Notes to the 57
consolidated financial statements
20. Personnel expenses
in CHF 1,000 2006 2005
Salaries 65,648 44,446
Termination payments 0 165
Social security costs 8,305 4,814
Share-based payments 624 1,683
Pension cost for defined benefit plans 465 2,286
Pension cost for defined contribution plans 835 249
Other personnel expenses 4,596 3,102
Total 80,473 56,745
20.1 Employees per segment at year-end
31.12.2006 31.12.2005
Heating and Cooling Technology 616 396
Washing Technology 453 437
Total 1,069 833
20.2 Employees per country at year-end
31.12.2006 31.12.2005
Switzerland 465 445
Germany 513 322
Austria 16 16
Denmark 75 50
Total 1,069 833
20.3 Average number of employees
2006 2005
Total 951 618
20.4 Unexercised options on shares of the Schulthess Group AG
Board of directors of Schulthess Group AG as well as the group management receive
a minimum of 14 %, but a maximum of 42 % of their directors fees and bonuses in
form of options and shares. The option scheme was set up in April 2002. All options
and shares are blocked for three years and can thereafter be exercised during the
period of one year. Cash settlements are not foreseen. The allocation of options
since 2005 has been fully delegated to a Swiss bank.
Personnel expense for the options schemes 2003, 2004, 2005 and 2006 amounts to
CHF 0.3 million (2005: CHF 0.4 million).
The regulations were amended in July 2006 as follows: The vesting period of 48
months was reduced to 15 months. These resulted in a non-recurring expense of
CHF 0.2 million.

Schulthess Group Finances Notes to the 58
consolidated financial statements
Unexercised options
Average strike price
(CHF per share)
2006 2005
Number of
options
Average strike price
(CHF per share)
At 1 January 140,56 51,435 120,24 70,450
Options granted 600,00 2,670 290,00 6,885
Options exercised 105,00 –25,400 125,00 –25,900
Options exercised, prematurely 134,00 – 6,250 – 0
Options exercised, prematurely 290,00 –1,440 – 0
At 31 December 233,63 21,015 140,56 51,435
Out of the 21,015 open options (2005: 51,435) none were exercisable
(2005: 0). In 2006 all of the exercisable options were converted into
shares. A total of 33,090 shares were bought (2005: 25,900).
The strike price was CHF 105.00, CHF 134.00 and CHF 290.00.
Average market price of the share was CHF 590.
Conversion ratio for all options is 1 option : 1 registered share.
Number of
Number of unexercised options have the following maturity dates:
Number of unexercised options
Maturity date Strike price
(CHF per share)
2006 2005
March 2007 (ESOP 2003) 105,00 0 25,400
March 2008 (ESOP 2004) 134,00 12,900 19,150
April 2009 (ESOP 2005) 290,00 5,445 6,885
March 2010 (ESOP 2006) 600,00 2,670 0
21,015 51,435
The fair value for options is calculated using the binomial method with the following parameters:
2006 2005
Share price CHF 485 CHF 225
Strike price CHF 600 CHF 290
Duration 4 years 4 years
Volatility 22.0 % 23.2 %
Riskless interest 2.37 % 1.57 %
Conversion ratio 1/1 1/1
Dividend 2005 – CHF 7.00
2006 CHF 8.00 CHF 7.00
2007 CHF 8.00 CHF 7.00
2008 CHF 8.00 CHF 7.00
2009 CHF 8.00 –
Fair value at issue
Volatility is based on the discounted historical volatitity of the past year.
CHF 48.20 CHF 16.50
Further issued share capital instruments
As a part of the bonus to the management 650 shares (2005: 1,265)
were issued in 2006. These were definitely bought, but are blocked for
a period of 3 years. In consideration for this blocked period the selling
options
price per share was CHF 407, whereas market price was CHF 485 per
share. This represents a discount of 16 %. These shares are entitled to
dividends.

Schulthess Group Finances Notes to the 59
consolidated financial statements
21. Finance income
in CHF 1,000 2006 2005
Interest on cash equivalents and trade receivables 262 276
Total 262 276
22. Finance expenses
in CHF 1,000 2006 2005
Interest expense on bank loans and from third parties 602 229
Total 602 229
23. Earnings per share (EPS)
and dividend per share
in CHF 2006 2005
Profit for the year attributable to shareholders 31,705,000 17,892,000
Weighted average number of shares in circulation 1,062,140 1,049,414
Basic earnings per share 29.85 17.05
Profit for the year attributable to share holders 31,705,000 17,892,000
Weighted average number of ordinary shares in circulation 1,062,140 1,049,414
Adjustments for share options 360 13,086
Diluted earnings per share 29.84 16.84
Dividend paid per registered share 8.00 7.00
Amount of dividends paid to shareholders 8,480,000 7,145,000
Proposal of the Board of Directors to the Annual General Meeting on 19 April 2007:
Payment of a dividend of CHF 12.00 per registered share; amounting to a total dividend of
CHF 12,750,000.

Schulthess Group Finances Notes to the 60
consolidated financial statements
24. Acquisition of subsidiaries
On 23 December 2005 Schulthess Group AG acquired 100 % of shares
with voting rights of KKT Kraus Kälte- und Klimatechnik GmbH. The
goodwill of CHF 14,3 million shown in the balance sheet at 31 December
2005 was only a provisional figure. The purchase price allocation (IFRS
3) was made in the first half of 2006 with the following results:
in CHF 1,000 Fair Value
2006
Book value
2005
Cash and cash equivalents 2,563 2,563
Current assets 13,141 13,141
Non-current assets 3,466 3,466
Trademarks and customer lists 7,223 0
Goodwill 9,497 14,348
Third-party liabilities (incl. deferred tax) – 12,823 – 12,391
Total purchase price 23,067 21,127
Provisions for earn out payments 0 800
Purchase price paid 23,067 20,327
Less: cash and cash equivalents – 2,563 – 2,563
Total cash outflow for new acquisition 20,504 17,764
25. Related-party transactions
Total remuneration of the board of directors and group management
according to IFRS 2 for share-based payments; disclosed as follows:
in CHF 1,000 2006 2005
Short-term employee benefits 1,777 1,360
Compensation after termination of work
contracts
0 0
Compensation on termination of work contracts 0 0
Other long-term compensation 0 0
Share-based payments 583 1,087
Total 2,360 2,447
26. Events after the balance sheet date
After 31 December 2006 there are no events affecting the group financial
statements 2006.

Schulthess Group Finances Consolidated financial statement 61
Report of the group auditors
Report of the group auditors
to the general meeting of Schulthess Group AG, Bubikon
As auditors of the group, we have audited the consolidated financial statements (consolidated balance sheet, consolidated
income statement, consolidated cash flow statement, consolidated statement of changes in equity and notes to the
consolidated financial statements), pages 34 to 60, of the Schulthess Group for the year ended 31 December 2006.
These consolidated financial statements are the responsibility of the board of directors. Our responsibility is to express an
opinion on these consolidated financial statements based on our audit. We confirm that we meet the legal requirements
concerning professional qualification and independence.
Our audit was conducted in accordance with Swiss Auditing Standards and with the International Standards on Auditing,
which require that an audit be planned and performed to obtain reasonable assurance about whether the consolidated
financial statements are free from material misstatement. We have examined on a test basis evidence supporting the
amounts and disclosures in the consolidated financial statements. We have also assessed the accounting principles
used, significant estimates made and the overall consolidated financial statement presentation. We believe that our audit
provides a reasonable basis for our opinion.
In our opinion, the consolidated financial statements of Schulthess Group give a true and fair view of the financial
position, the results of operations and the cash flows in accordance with the International Financial Reporting Standards
(IFRS) and comply with Swiss law.
We recommend that the consolidated financial statements submitted to you be approved.
PricewaterhouseCoopers AG
Stefan Gerber Adrian Steiner
Auditor in charge
Zurich, 6 March 2007

Schulthess Group Finances Parent company 62
Financial statements
Financial statements
Schulthess Group AG
Balance sheet
in CHF 1 000 31.12.06 31.12.05
Cash 4,156 7,861
Accounts receivable from Group companies 5,306 1,451
Other receivables 755 783
Current assets 10,217 10,095
Accounts receivable from Group companies,
long term
9,042 9,295
Financial investments 62,837 60,764
Non-current assets 71,879 70,059
Total assets 82,096 80,154
Financial liabilites, short term 5,000 5,000
Financial liabilites, long term 0 5,000
Other liabilities 2,876 319
Accrued expenses 190 165
Tax liabilities 22 81
Provisions 270 1,040
Liabilities 8,358 11,605
Share capital 2,125 2,125
Reserves 24,856 24,856
Retained earnings: 46,757 41,568
– Carried forward from previous year 33,088 25,689
– Net profit 13,669 15,879
Total shareholders‘ equity 73,738 68,549
Total shareholders‘ equity and liabilities 82,096 80,154
Income statement
in CHF 1,000 2006 2005
Income from financial investments 13,700 17,583
Management fees 1,023 1,070
Other revenue 80 – 200
Financial income 694 4,276
Other income 0 488
Total income 15,497 23,217
Financial expenses 266 5,056
Depreciation of financial investments 0 660
Other operating expenses 1,523 1,575
Taxes 39 47
Total expenses 1,828 7,338
Net profit 13,669 15,879

Schulthess Group Finances Parent company 63
Notes to the financial statements
Notes to the financial statements
Holdings
Company Nominal capital Percentage held
2006 2005
Schulthess Maschinen AG, CH-Bubikon CHF 1,500,000 100 % 100 %
Merker AG, CH-Dällikon CHF 500,000 100 % 100 %
Novelan AG, CH-Dällikon CHF 1,250,000 100 % 100 %
Schulthess Maschinen GmbH, AT-Wien EUR 500,000 100 % 100 %
Alpha-Innotec GmbH, DE-Kasendorf EUR 500,000 100 % 100 %
Calmotherm AG, CH-Altishofen CHF 250,000 70 % 70 %
Genvex A/S, DK-Haderslev DKK 2,000,000 100 % 100 %
KKT Kraus Kälte- und Klimatechnik GmbH, DE-Lauf EUR 250,000 100 % 100 %
All these companies are operating in Heating/Cooling and Washing Technology industries.
Treasury shares
in number of shares 2006 2005
Balance at 1 January 0 41,839
Purchase of shares 2,310 7,686
Sale of shares –2,310 –49,525
Balance at 31 December 0 0
in CHF 1,000
Value at 1 January 0 2,892
Purchase of shares at market price 1,216 1,565
Sale of shares at market price –1,216 –4,457
Value at 31 December 0 0
Guarantees (in CHF 1,000) 3,800 4,000
Guarantees to third parties in favour of subsidiaries
Significant shareholders
in % 2006 2005
Rudolf Kägi 10.05 % 10.23 %
Paul O. Rutz 9.99 % 9.99 %
Focus Capital Investors, UC 6.83 % < 5 %
Andrea Malär 5.42 % 5.28 %
GlobeFlex Capital, LP 5.16 % < 5 %

Schulthess Group Finances Parent company 64
Proposed appropriation of available earnings
Proposed appropriation of available earnings
Proposal of the Board of Directors for the appropriation of available earnings for 2006:
in CHF 1,000 2006 2005
Carried forward from previous year 33,088 25,689
Net profit 13,669 15,879
Retained earnings 46,757 41,568
Dividend (CHF 12.00 per registered share; before split) –12,750 –8,500
Waived dividend on treasury shares 0 20
Carried forward to next year 34,007 33,088

Schulthess Group Finances Parent company 65
Report of the statutory auditors
Report of the statutory auditors
to the general meeting of Schulthess Group AG, Bubikon
As statutory auditors, we have audited the accounting records and the financial statements (balance sheet, income statement
and notes), pages 62 and 63, of the Schulthess Group AG for the year ended 31 December 2006.
These financial statements are the responsibility of the board of directors. Our responsibility is to express an opinion on
these financial statements based on our audit. We confirm that we meet the legal requirements concerning professional
qualification and independence.
Our audit was conducted in accordance with Swiss Auditing Standards, which require that an audit be planned and performed
to obtain reasonable assurance about whether the financial statements are free from material misstatement.
We have examined on a test basis evidence supporting the amounts and disclosures in the financial statements. We have also
assessed the accounting principles used, significant estimates made and the overall financial statement presentation. We
believe that our audit provides a reasonable basis for our opinion.
In our opinion, the accounting records and financial statements and the proposed appropriation of available earnings comply
with Swiss law and the company‘s articles of incorporation.
We recommend that the financial statements submitted to you be approved.
PricewaterhouseCoopers AG
Stefan Gerber Adrian Steiner
Auditor in charge
Zurich, 6 March 2007

Schulthess Group History 66
Milestones
2006 Extension of production facilities for heat pumps at Alpha-Innotec GmbH, Kasendorf (Germany)
2005 Acquisition of KKT Kraus Kälte- und Klimatechnik GmbH, Lauf a. d. Pegnitz (Germany)
2004 Takeover of Genvex A/S, Haderslev (Denmark)
2003 Launch of a new washing machine generation Spirit XL for single-family homes, multiple-occupancy properties and
smaller commercial enterprises
2002 Start of new assembly line with integrated production
2001 Takeover of the heating pumps activities of the brand Siemens in Germany and Austria
2000 Takeover of Alpha-Innotec GmbH, Kasendorf (Germany) and Calmotherm AG, Altishofen (Switzerland)
1999 Takeover of Novelan AG, Dällikon. Wuxi Little Swan-Schulthess joint venture starts production
1998 Schulthess Group goes public. Joint venture established with Wuxi Little Swan (China)
1997 Formation of Schulthess Group AG as the holding company for the Schulthess companies
1995 150th anniversary; Maschinenfabrik Schulthess AG renamed Schulthess Maschinen AG
1995 Spin-off of Maschinenfabrik Hildebrand AG, Aadorf, Switzerland
1994 Introduction of flow production (just-in-time production)
1991 Takeover of Merker AG, Baden, Switzerland
1988/89 Maschinenfabrik Schulthess AG, Querop Handels AG and Hildebrand AG join forces to form the Schulthess Group
1988 Management buy-out results in separation from family shareholders group
1978 Launch of the first microchip-controlled washing machines
1951 Production of Europe’s first household washing machines
1949 Invention of punched-card control system for washing machines
1943 Former general partnership transformed into a joint-stock company
1917 Move to production facility in Wolfhausen, canton of Zurich
1904 Production of the first washing machine
1890 Takeover of Ornamentfabrik Künzli & Co. in Zurich
1845 Foundation of „Bauspenglerei Kaspar Schulthess“ in Zurich

Schulthess Group Companies Adresses 67
Schulthess Group Companies
Schulthess Group AG
Landstrasse 37
CH-8633 Wolfhausen
Telefon +41 55 253 51 11
Fax +41 55 253 54 80
E-Mail direktion@schulthess-group.com
Internet www.schulthess-group.com
Schulthess Maschinen AG
Landstrasse 37
CH-8633 Wolfhausen
Telefon +41 55 253 51 11
Fax +41 55 253 54 70
E-Mail info@schulthess.ch
Internet www.schulthess.ch
Schulthess Maschinen GmbH
Hetzendorferstrasse 191
AT-1130 Wien
Telefon +43 1 803 98 00 20
Fax +43 1 803 98 00 30
E-Mail verkauf@schulthess.at
Internet www.schulthess-maschinen.com
Merker AG
Buchserstrasse 31
CH-8108 Dällikon
Telefon +41 44 847 21 00
Fax +41 44 847 21 01
E-Mail info@merker.ch
Internet www.merker.ch
Novelan AG
Buchserstrasse 31
CH-8108 Dällikon
Telefon +41 44 847 48 11
Fax +41 44 847 48 10
E-Mail info@novelan.ch
Internet www.novelan.ch
Alpha-Innotec GmbH
Industriestrasse 3
DE-95359 Kasendorf
Telefon +49 9228 9906 0
Fax +49 9228 9906 29
E-Mail kontakt@alpha-innotec.de
Internet www.alpha-innotec.de
Novelan GmbH
Industriestrasse 3
DE-95359 Kasendorf
Telefon +49 9228 99607 0
Fax +49 9228 99607 189
E-Mail info@novelan.com
KKT Kraus Kälte- und
Klimatechnik GmbH
Industriestrasse 23 a
DE-01207 Lauf a. d. Pegnitz
Telefon +49 912 317 40-1
Fax +49 912 382 44-1
E-Mail kkt@KKT-Kraus.com
Internet www.KKT-Kraus.com
Genvex A/S
Sverigevej 6
DK-6100 Haderslev
Tel. +45 (73) 53 27 00
Fax +45 (73) 53 27 07
E-Mail salg@genvex.dk
Internet www.genvex.dk
Calmotherm AG
Logistikcenter Gäuerhof
CH-6246 Altishofen
Telefon +41 62 748 20 00
Fax +41 62 748 20 01
E-Mail info@calmotherm.ch
Internet www.calmotherm.ch

Financial calendar
Balance sheet media conference/
Presentation to analysts 13 March 2007
Shareholders‘ Meeting 19 April 2007
Half-yearly shareholders‘ letter 14 August 2007
Turnover report for 2007
financial year 22 January 2008
Balance sheet media conference/
Presentation to analysts 11 March 2008
Shareholders‘ Meeting 17 April 2008
Contact address for Investor Relations
Max M. Müller
Chief Financial Officer
Schulthess Group AG
Landstrasse 37
CH-8633 Wolfhausen
Telephone ++ 41 55 253 51 11
Fax ++ 41 55 253 54 80
E-mail cfo@schulthess-group.com

Schulthess Group AG
Landstrasse 37
CH-8633 Wolfhausen
Telefon +41 55 253 51 11
Fax +41 55 253 54 80
E-Mail direktion@schulthess-group.com
Internet www.schulthess-group.com
Conception and editing:
Schulthess Group AG
Design and setting:
Mapro AG, Winterthur
Photos:
Günter Bolzern, Peter Schönenberger, Prisma,
bab.ch/mauritius images, Corbis/Specter
Printing:
Multicolor Print AG, Baar
This report also appears in German. The German version
is binding.
3.2007.450.e