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Chairman’s statement



Dear shareholders,


2017 was marked by a return to growth: our markets, our product range extension, our historic and more recent subsidiaries, our prices, the euro, and the weather, all made a positive contribution to the group’s business. Unsurprisingly, our teams were ready and willing to respond to this favourable trend by seizing all possible opportunities efficiently and with real commitment.

Importantly - and quite unusually – five acquisitions came to fruition between March and December 2017, laying the foundations for a new source of growth for 2018. They are perfectly aligned with our strategy since they help strengthen our market presence for the distribution of industrial valves, and outside our borders. This means that we will be less exposed to French market cycles in the new-build sector.

Finally, the end of the year saw a cancellation of the tax paid on dividends between 2015 and 2017.

This has all conspired to produce some very flattering figures, and we would be well-advised to bear in mind the fact that we are working on some very demanding markets. Humility remains the watch-word at every level of the Group, paying permanent attention to serving our customers properly and satisfying our industrial partners.

Consolidated turnover increased by 17.4% and 10.3% for the same scope. Operating income reached €37.7m for the first time (+18.7%) and net profit leaped to €26.2m including the €1.5m decrease in tax burden further to the cancellation of the tax on dividends.

Our distribution policy remains in place: the Board proposed a 20-cent increase in the dividend to €3.40 per share. If approved, the distribution rate will be 59%.

The 10-year strategy laid out in 2016 remains unchanged. However, we are developing quicker than the strategy required, and in 2018 we should be working primarily on embedding the companies that have recently joined us. Simultaneously, our historic subsidiaries will be doing the groundwork on their own markets via conventional or digital distribution channels. All indicators suggest that growth should continue, meaning our confidence remains high.

Unusually, and making the most of interest rates under 0.5%, we have turned to a bank loan as a means of financing, for a total of €30m. When we add the debts of Domac and Sodeco Valves, our bank exposure is €30.8m, which should be compared to our cash
position (+€28.6m) and equity (€189.7m). Our debt level is therefore very low, meaning we can carry very high stock levels, which allows us to be very reactive to our customers’ requirements.

Our financial communications followed the same pattern as the previous year. However, the distribution of our capital shifted markedly in favour of French institutional investors who would seem to have led some very deliberate initiatives to build up substantial reserves of Thermador Groupe shares in their “midcaps” holdings. Thus, their share of our capital rose from 17.3% to 24.9%, and trading on the share increased by 44%. At the same time, small private investors’ holdings fell from 36.2% to 31.1% of our capital, and were 8% fewer in number.

Our Annual General Meeting will be held on April 9 in Lyon. As last year, we will give those who wish to vote remotely the possibility of doing so via the Votaccess platform. We would also like to increase still further the attendance rate and invite you to fulfil your obligations as a shareholder by attending the Annual General Meeting, or else giving your vote to somebody else or voting remotely. The attendance rate reflects your commitment at our side and the efficacy of our governance bodies.

MDP-GRobin