Comment on the Financial Report 2022

From Mathias Kronig, Head of Administration and Deniz Goer, Head of Finance

Income Statement

Swiss TPH presents an ordinary result of CHF – 125,647 in 2022, compared to CHF +3,261,026 in 2021. The operating result from activities amounts to CHF – 346,284, which represents a decrease of CHF 880,935 in comparison to 2021 (CHF +534,651). This result was achieved despite a challenging environment with a strong Swiss Franc, increases in energy costs and growing operating expenses of our new headquarters “Belo Horizonte”.

The financial result reached CHF +220,636 (compared to CHF +172,378 in 2021), mainly due to on favourable exchange rate transactions and unrealised gains on foreign currency holdings in USD/CHF and EUR/CHF. This is one of the active risk mitigation measures taken by Swiss TPH management in order to reduce currency exposure.

In 2022, Swiss TPH reports no extraordinary result. In 2021 an extraordinary gain of CHF +2,553,997 resulting from the sale of the property at Socinstrasse in Basel was realised.

The operating income of Swiss TPH increased (+10.9%) from CHF 94.5 million in 2021 to CHF 104.8 million in 2022. Excluding the effect on the income statement from the utilisation of the “Belo Horizonte” investment fund (CHF 2.1 million), sales growth would have been as high as CHF 8.2 million or 8.7% in nominal terms in 2022, as compared to 2021.

The core funding increased slightly from CHF 21.3 million in 2021 to CHF 22.7 million in 2022 (+6.7%). The project restricted funds from the State Secretariat for Education, Research and Innovation (SERI) has been reclassified from core funding to self-managed income. Previous year disclosure has been updated accordingly to ensure comparability of the figures.

In 2022, Swiss TPH managed to increase its share of competitively acquired third-party funding. Self-managed income from research, education and services increased to CHF 78.5 million in 2022, representing a growth of CHF 10.2 million or 14.9% compared to the previous year (CHF 68.3 million).

Personnel expenses increased by 4.7% or CHF 2.6 million from CHF 55.2 million in 2021 to CHF 57.8 million in 2022. The growth was mainly driven by higher salary costs (+CHF 1.2 million) with 14 additional employees on the payroll. Furthermore, an increase in travel expenses due to rising travel activities and costs (+CHF 1.1 million) was registered.

Other operating expenses increased by 20.5% or CHF 5.9 million from CHF 28.6 million in 2021 to CHF 34.5 million in 2022. With an increase of CHF 2.4 million, local project expenditures contributed substantially to the rise and are the consequences of enhanced project activities. Furthermore, an increase of 3.4 million in renting, energy and maintenance expenditures mainly contributed to the rise in other operating expenses. The majority of local project expenditures, totalling CHF 27.4 million in 2022 versus CHF 25.0 million in 2021, were spent in Africa (CHF 16.2 million, an increase of CHF 0.5 million). The local expenditures for European projects rose by CHF 2.4 million to CHF 10.4 million.

The depreciation costs amounted to CHF 3.3 million in 2022 (CHF +1.8 million) compared to 2021. This rise was mainly driven by the completion of the investments for the new headquarters “Belo Horizonte” in 2022. The depreciation costs contain CHF 2.1 million, which were covered by the utilisation of the investment fund “Belo Horizonte” recognised within other operating income.

Balance Sheet

Total assets decreased by 20.6% (CHF 18.4 million) to CHF 70.9 million compared to 2021.

Current assets decreased by 25.6% or CHF 18.6 million yearon-year to CHF 54.2 million in 2022 from CHF 72.8 million in 2021. Therein cash and cash equivalents decreased by CHF 5.4 million or 14.8% from CHF 36.2 million in 2021 to CHF 30.8 million in 2022. The reason was the remaining purchase of fixed assets for Swiss TPH, which were capitalized in 2022 and the reduction of payables.

Other short-term receivables decreased by CHF 2.3 million or 21.0% to CHF 8.7 million in 2022 compared to the previous year due to the decreased number of advances for projects to be implemented locally or for subcontractors within project assignments.

Swiss TPH also noted a decrease in prepayments and accrued income from 2021 to 2022. The decline amounted to CHF 3.7 million or 33.5% and is due to decreased advance payments for projects on behalf of Swiss TPH.

Non-current assets increased slightly by CHF 0.2 million to CHF 16.8 million in 2022 compared to 2021. The categories “Building” and “Equipment” increased by CHF 11.9 million mainly due to the reclassification of assets under construction, which decreased sharply by CHF 14.9 million. The assets under construction reclassified in 2022 mainly consist of laboratory equipment, furniture, IT-equipment and other fixtures and fittings in the new headquarters.

Current liabilities declined sharply to CHF 49.7 million in 2022 compared to CHF 67.4 million in 2021 as a result of active cash management by reducing payables to prevent negative interest on bank accounts. In this regard, payables from goods and services decreased from CHF 10.6 million in 2021 to CHF 3.1 million in 2022. Other payables decreased from CHF 5.5 million in 2021 to CHF 2.0 million in 2022.

Accrued liabilities and deferred income decreased from CHF 48.7 million in 2021 to CHF 42.2 million in 2022.

Non-current liabilities decreased slightly from CHF 13.4 million in 2021 to CHF 12.8 million in 2022.

As a result of the 2022 loss of CHF 125,647, equity decreased from CHF 8,544,462 (31 December 2021) to CHF 8,418,815 (31 December 2022).