112 Consolidated Financial Statements and Notes 04

1 112 consolidated financial statements and notes Independent Auditors' Fees 04. Consolidated Financial Statements and Notes Consolidated Financial Statements and Notes Statement of Profit or Loss and Other Comprehensive Income 113. Statement of Profit or Loss and Other Comprehensive Income Notes 2016 2015. 12 months 12 months in K in K. Sales revenue [9] 1,051,611 884,331. Cost of sales 524,791 432,546. Gross profit on sales 526,820 451,785. Selling and distribution costs 186,601 167,191. Research and development costs 47,536 41,529. General administrative expenses 56,471 48,912. Other operating income and expenses [11] 10,296 9,621. Earnings before interest and taxes (EBIT) 225,916 184,532. Financial income [12] 1,884 2,854. Financial expenses [12] 14,815 17,708. Financial result 12,931 14,854. Profit before tax 212,985 169,678. Income taxes [13] 57,108 50,184. Net profit for the period 155,877 119,494. Attributable to: Equity holders of sartorius Stedim Biotech 153,678 117,999.

2 Non-controlling interest [23] 2,199 1,495. Earnings per share ( )1) [15] Diluted earnings per share ( )1) [15] Other Comprehensive Income 2016 2015. 12 months 12 months Notes in K in K. Net profit for the period 155,877 119,494. Cash flow hedges [30] 5,258 1,392. of which effective portion of changes in fair value 1,760 9,320. of which reclassified to profit or loss 3,498 7,928. Income tax on cash flow hedges [18] 1,577 418. Net investment in a foreign operation2) 3,240 6,646. Income tax on net investment in a foreign operation [18] 974 1,992. Foreign currency translation differences 385 21,840. Items that are or may be reclassified subsequently to profit or loss 5,562 16,212. Remeasurements of the net defined benefit liabilities [24] 1,784 195. Income tax on remeasurements of the net defined benefits liabilities [18] 229 7. Items that will not be reclassified to profit or loss 1,555 202. Other comprehensive income after tax 7,117 16,010. Total comprehensive income 148,760 135,504.

3 Attributable to: Equity holders of sartorius Stedim Biotech 146,504 133,697. Non-controlling interest 2,255 1,807. 1). Earnings per share for 2015 have been adjusted according to the increase in number of shares following the stock split (see chapter 22). 2). This caption refers to foreign exchange gains and losses in connection with intragroup loans granted on a long-term basis. 114 Consolidated Financial Statements and Notes Statement of Financial Position Statement of Financial Position Notes Dec. 31, 2016 Dec. 31, 2015. in K in K. Non-current assets Goodwill [16] 344,777 336,959. Other Intangible Assets [16] 144,018 143,349. Property, plant and equipment [17] 261,464 222,875. Financial Assets 2,272 1,330. Other Assets 832 751. Deferred tax assets [18] 10,754 10,042. 764,116 715,306. Current assets Inventories [19] 171,057 146,970. Trade receivables [20] 183,952 142,344. Other Financial assets [21] 8,543 8,362. Current tax assets 20,901 9,783. Other assets 12,524 11,541.

4 Cash and cash equivalents 34,756 31,831. 431,733 350,831. Total assets 1,195,849 1,066,137. Equity Equity attributable to SSB shareholders 758,005 641,441. Issued capital [22] 18,083 15,367. Capital reserves 231,526 235,231. Retained earnings (including net profit) 508,396 390,843. Non-controlling interest [23] 5,551 5,778. 763,556 647,219. Non-current liabilities Pension provisions [24] 34,219 31,737. Other provisions [27] 3,083 3,278. Loans and borrowings [25] 9,375 12,602. Finance lease liabilities [29] 16,678 16,937. Other Financial liabilities [26] 55,792 51,488. Deferred tax liabilities [18] 28,780 30,186. 147,928 146,229. Current liabilities Provisions [27] 9,281 8,014. Trade payables [28] 107,754 100,598. Loans and borrowings [25] 74,677 87,214. Finance lease liabilities [29] 1,592 1,506. Other Financial liabilities [28] 23,245 14,953. Employee benefits 28,619 26,374. Current tax liabilities 20,997 19,964. Other liabilities 18,200 14,067. 284,364 272,689. Total equity and liabilities 1,195,849 1,066,137.

5 Consolidated Financial Statements and Notes Statement of Cash Flows 115. Statement of Cash Flows Notes 2016 2015. 12 months 12 months in K in K. Profit before tax 212,985 169,678. Financial result [12] 12,931 14,854. Earnings before interest and taxes (EBIT) 225,916 184,532. Depreciation | amortization of fixed assets [16][17] 44,687 39,856. Increase | decrease in provisions [24][27] 449 730. Income taxes paid [13] 65,717 43,570. Other non-cash items 583 0. Gross cash flows from operating activities 205,020 180,087. Increase | decrease in receivables and other assets [20][21] 45,206 11,466. Increase | decrease in inventories [19] 23,429 32,428. Increase | decrease in liabilities [26][28] 20,274 6,596. Net cash flow from operating activities 156,659 142,789. Acquisitions of intangible and tangible assets [16][17] 79,713 52,985. Other payments 0 544. Net cash flow from investing activities 79,713 52,441. Payments for acquisitions of Consolidated subsidiaries and other business operations.

6 Net of cash acquired [8] 23,020 53,888. Net cash flow from investing activities and acquisitions 102,733 106,329. Changes in capital [22] 636 175. Interest received [12] 129 129. Interest paid and other Financial charges [12] 1,681 2,937. Dividends paid to: - Shareholders of sartorius Stedim Biotech SA 30,734 19,967. - Non-controlling interest 795 446. Gross cash flows from financing activities 33,717 23,046. Changes in non-controlling interest [23] 0 7,531. Proceeds from loans and borrowings raised [25] 18,998 35,234. Repayments of loans and borrowings [25] 35,378 31,891. Net cash flow from financing activities 50,096 27,234. Net increase | decrease in cash and cash equivalents 3,831 9,226. Cash and cash equivalents at the beginning of the period 31,831 18,543. Net effect of currency translation on cash and cash equivalents 906 4,062. Cash and cash equivalents at the end of the period 34,756 31,831. The Notes to the Consolidated Financial Statements are an integral part of these Statements .

7 116 Consolidated Financial Statements and Notes Statement of Changes in Equity Statement of Changes in Equity Foreign currency Non- trans- control- Issued Capital Hedging Pension Retained lation Group ling Total in K capital reserves reserves reserves earnings reserves equity interest equity Balance at Jan. 1, 2015 15,359 235,047 2,306 9,461 279,473 14,333 532,444 6,653 539,097. Net profit for the period 0 0 0 0 117,999 0 117,999 1,495 119,494. Cash flow hedges 0 0 1,392 0 0 0 1,392 0 1,392. Remeasurements of the net defined benefit liabilities 0 0 0 71 0 0 71 124 195. Foreign currency translation differences 0 0 0 0 0 21,404 21,404 436 21,840. Net investment in a foreign operation 0 0 0 0 6,646 0 6,646 0 6,646. Related deferred tax 0 0 418 7 1,992 0 2,403 0 2,403. Other comprehensive income for the period 0 0 974 78 4,654 21,404 15,698 313 16,010. Total comprehensive income 0 0 974 78 113,345 21,404 133,697 1,807 135,504. Stock options 8 184 0 0 0 0 192 0 192. Dividends 0 0 0 0 19,967 0 19,967 446 20,413.

8 Changes in non-controlling interest 0 0 0 0 5,064 0 5,064 2,235 7,299. Other changes 0 0 0 0 139 0 139 0 139. Balance at Dec. 31, 2015 I. Jan. 1, 2016 15,367 235,231 3,280 9,539 367,926 35,736 641,441 5,779 647,220. Net profit for the period 0 0 0 0 153,678 0 153,678 2,199 155,877. Cash flow hedges 0 0 5,258 0 0 0 5,258 0 5,258. Remeasurements of the net defined benefit liabilities 0 0 0 1,784 0 0 1,784 0 1,784. Foreign currency translation differences 0 0 0 0 0 328 328 57 385. Net investment in a foreign operation 0 0 0 0 3,240 0 3,240 0 3,240. Deferred taxes 0 0 1,577 229 974 0 2,780 0 2,780. Other comprehensive income for the period 0 0 3,681 1,555 2,266 328 7,174 57 7,117. Total comprehensive income 0 0 3,681 1,555 151,412 328 146,504 2,255 148,760. Stock options 0 0 0 0 0 0 0 0 0. Capital increase 3,069 3,705 0 0 0 0 636 0 636. Dividends 0 0 0 0 30,734 0 30,734 795 31,529. Changes in non-controlling interest 0 0 0 10 1,699 0 1,689 1,689 0. Other changes 353 0 0 122 28 0 259 0 259.

9 Balance at December 31, 2016 18,083 231,526 6,961 10,982 490,276 36,064 758,005 5,551 763,556. The increase in non-controlling interest in 2015 refers to the acquisition of additional shares in the company sartorius Korea Biotech, in 2016 this caption contains the acquisition of the remaining shares in AllPure (please refer also to note 23). The capital increase in 2016 refers to the stock split realized in 2016. Please refer to note 22 for further details. Consolidated Financial Statements and Notes Notes to the Financial Statements 117. Notes to the Financial Statements 1. General Information 2. Effects of New Financial Reporting Standards sartorius Stedim Biotech is a leading provider of cutting-edge equipment and services for the The following new accounting rules were applicable development, quality assurance and production for the first time to the present Financial Statements processes of the biopharmaceutical industry. Its and had no impact on the presentation of the integrated solutions covering fermentation, filtration, company's Financial position and Financial purification, fluid management, cell culture media and performance: lab technologies are supporting the biopharmaceutical industry around the world to develop and produce Annual Improvements to IFRSs 2010 2012 Cycle drugs safely, timely and economically.

10 For next- (issued in December 2013). generation processes, sartorius Stedim Biotech focuses on single-use technologies and added-value services to Under the Annual Improvements project changes to meet the rapidly changing technology requirements of seven standards were implemented. These amendments the industry it serves. Strongly rooted in the scientific are supposed to clarify the existing regulations. community and closely allied with customers and Additionally those changes have an impact on technology partners, the company is dedicated to its disclosures. The affected standards are IFRS 2, IFRS 3, philosophy of Turning science into solutions. IFRS 8, IFRS 13, IAS 16, IAS 24 and IAS 38. Headquartered in Aubagne, France, sartorius Stedim Annual Improvements to IFRSs 2012 2014 Cycle Biotech is listed on the Euronext Paris (ISIN code: (issued in September 2014). FR 0000053266). This cycle concerns the standards IFRS 5, IFRS 7, IAS 19. sartorius Stedim Biotech 's ultimate parent and IAS 34.