3 Capital and Financial Risk Management

This chapter presents the capital structure and the financial risks to which Belimo is exposed. Furthermore, it describes how cash management is made to cover the liquidity risk and which financial liabilities Belimo has to consider for its operational business. A solid capital structure enables Belimo to offer an appropriate dividend.

3.1 Cash and Cash Equivalents

3.1Cash and Cash Equivalents

in CHF 1 000	December 31, 2025	December 31, 2024

Cash	100 640	82 166
Cash equivalents	-	15 000
Total	100 640	97 166

Cash consists of demand deposits and cash on hand. Cash equivalents include term deposits with a maturity of three months or less from the date of acquisition. The impairment assessments in the reporting period and the previous year showed no need for an adjustment.

Cash and cash equivalents are measured at amortized cost.

3.2 Financial Risk Management

3.2Financial Risk Management

Due to the nature of its activities, Belimo is exposed to several financial risks such as credit risk, liquidity risk, foreign currency risk, and interest rate risk.

Risk management policies are established to identify and to analyze the risks to which the Group is exposed, to define appropriate limits, to establish controls, and to monitor the risks and compliance. Risk management policies and processes are reviewed regularly to reflect changes in market conditions and in the Group’s activities. The identified risks and measures to minimize them are presented below:

Risk	Source	Risk mitigation

Credit risk	Through its operational business, Belimo is exposed to the risk of financial loss if a customer or a counterparty fails to meet its contractual obligations. The credit risk mainly arises from cash and cash equivalents, trade receivables, and term deposits.	High standards on financial institutes to cooperate with, as well as analyzing the credit worthiness of counterparties considering a variety of factors such as credit ratings or payment history.
Liquidity risk	Liquidity risks result from difficulties in meeting obligations associated with financial liabilities that are settled by delivering cash or another financial asset.	Aim to always have sufficient liquidity and unused credit lines available. Centrally managed liquidity by Group Treasury and various principles to ensure adequate liquidity for subsidiaries on short notice.
Foreign currency risk	Foreign currency risk is the risk that the fair value or future cash flows of an exposure will fluctuate because of changes in foreign exchange rates. The Group’s exposure to the risk of changes in foreign exchange rates relates primarily to the Group’s operating activities (when revenue or expense is denominated in a foreign currency) and the Group’s net investments in foreign subsidiaries.	Achieve natural hedging by matching cash inflows and outflows in a specific currency as far as possible as well as facilitating risk management by using forward contracts.
Interest rate risk	Interest rate risk is the risk that the fair value or future cash flows of a financial instrument will fluctuate because of changes in market interest rates.	Belimo has no material exposure to the interest rate risk.

Credit Risk

Belimo holds its cash and cash equivalents worldwide with major financial institutions that meet clear internal criteria for credit quality and financial stability. These investments generally have maturities of less than three months. Investments with maturities exceeding three months from the date of acquisition are made only with institutions that continue to satisfy Belimo’s elevated standards for creditworthiness and risk management.

The credit risk from trade receivables is limited, since the Group’s customer base is broad and spread over a variety of geographical areas. Credit risk is mainly influenced by the specific characteristics of each individual customer. The risk assessment includes an analysis of the creditworthiness, taking into account a variety of factors such as credit ratings or payment history. Credit limits are set according to regional aspects. Certain new customers are supplied only against payment in advance.

The maximum default risk is the carrying amount of the individual assets as at the reporting date (see table in chapter ’Categories of Financial Instruments’ below). There are no guarantees or similar obligations that could lead to an increase in risk beyond the carrying amounts.

Liquidity Risk

At the reporting date, the contractual maturities of the undiscounted financial liabilities (including contractual interest payments) were as follows:

in CHF 1 000	Less than 1 year	1–5 years	More than 5 years	Total

As at December 31, 2025
Trade payables	60 636	-	-	60 636
Bank loans	824	3 307	13 886	18 017
Lease liabilities	7 237	21 705	6 650	35 591
Derivatives	435	-	-	435
Other financial liabilities	350	-	-	350
Other liabilities qualifying as financial instruments	65 599	-	-	65 599
Total	135 081	25 011	20 536	180 629

As at December 31, 2024
Trade payables	39 335	-	-	39 335
Bank loans	559	3 060	8 410	12 029
Lease liabilities	4 046	7 344	1 555	12 945
Derivatives	2 835	-	-	2 835
Other financial liabilities	388	-	-	388
Other liabilities qualifying as financial instruments	50 084	-	-	50 084
Total	97 247	10 405	9 965	117 616

Liquidity is centrally managed and controlled by Group Treasury. The subsidiaries are adequately financed by intercompany loans to meet their ongoing commitments and through participation in the Group’s internal cash pooling arrangements.

Belimo can draw down loans at fixed or floating rates for various terms, based on its short and medium-term liquidity needs. Belimo aims to preserve maximum flexibility in its liquidity planning through flexible use of the general credit lines and by staggering the maturity dates of the individual amounts. Belimo has CHF 110.0 million of committed credit lines (not used as at December 31, 2025). In the previous year, the total amount of CHF 110.0 million of committed credit lines were available (not used as at December 31, 2024).

Foreign Currency Risk

The following table shows the main foreign exchange risk exposure for financial instruments (excluding currency forward instruments) with a currency that differs from the functional currency of the Group company holding them.

	December 31, 2025			December 31, 2024
in CHF 1 000	Assets	Liabilities	Net	Assets	Liabilities	Net

CAD	3 201	-57	3 144	7 377	-407	6 969
CHF	956	-14 698	-13 742	1 496	-20 008	-18 513
EUR	34 145	-47 793	-13 649	36 949	-33 937	3 013
GBP	5 154	-313	4 840	2 954	-150	2 804
HKD	8 766	-	8 766	6 512	-	6 512
PLN	8 665	-126	8 538	8 436	-56	8 380
USD	63 049	-21 962	41 087	43 582	-12 658	30 924
Other	13 198	-1 009	12 189	13 423	-326	13 097
Total	137 133	-85 959	51 174	120 728	-67 542	53 186

At the reporting date, the following currency forward instruments were held. Whereas foreign currency forward contracts selling foreign currencies are disclosed as positive figures and contracts buying foreign currencies as negative figures:

in CHF 1 000	December 31, 2025	December 31, 2024

Face values
in CAD	14 542	13 033
in EUR	2 789	-
in GBP	4 564	5 153
in PLN	8 143	7 178
in USD	48 331	58 065
Other	10 786	6 161
Total	89 156	89 590

Fair values
positive	237	34
negative	-435	-2 835
Total	-198	-2 800

The currency-related sensitivity of financial instruments is shown in the following table:

	December 31, 2025			December 31, 2024
	Exchange			Exchange
in CHF 1 000		gain	loss		gain	loss

CAD	-/+ 5%	577	-577	-/+ 5%	308	-308
CHF	-/+ 5%	687	-687	-/+ 5%	926	-926
EUR	-/+ 5%	543	-543	+/- 5%	151	-151
GBP	+/- 5%	12	-12	-/+ 5%	119	-119
HKD	+/- 5%	438	-438	+/- 5%	326	-326
PLN	+/- 5%	15	-15	+/- 5%	55	-55
USD	-/+ 5%	352	-352	-/+ 5%	1 480	-1 480
Other	+/- 5%	67	-67	+/- 5%	347	-347
Total		2 690	-2 690		3 712	-3 712

This analysis assumes that all other variables are held constant and takes into account hedging transactions. The same assumptions were applied in the previous year.

To limit foreign exchange risk, Belimo primarily aims to achieve natural hedging by matching cash inflows and outflows in a specific currency as far as possible. Belimo has centralized its foreign exchange management in Switzerland. Within EMEA, invoices between Group companies are mainly denominated in the currency of the company receiving the invoice. Other subsidiaries of Belimo hedge their currency risk through other intercompany transactions, thus ensuring efficient risk management as currency flows can be offset within the Group as far as possible. Its net currency positions are hedged on a rolling basis by the Swiss companies, usually by entering forward contracts.

Interest Rate Risk

The Group’s exposure to the risk of changes in market interest rates relates primarily to the Group’s long-term bank loans. The Group did not perform any quantitative sensitivity analysis as at December 31, 2025 and 2024 for the exposure to the risk of changes in market interest rates, as they are considered to be immaterial.

Categories of Financial Instruments

The following table shows the carrying amounts of the Group’s financial instruments. For assets and liabilities not measured at fair value (excluding lease liabilities), the carrying amount is a reasonable approximation of fair value. In accordance with IFRS Accounting Standards, the fair value of the lease liabilities is neither calculated nor disclosed.

in CHF 1 000	Amortized Cost	FVPL¹⁾	FVOCI²⁾	Total financial instruments	Non-financial instruments	Total

As at December 31, 2025
Cash and cash equivalents	100 640	-	-	100 640	-	100 640
Trade receivables	155 289	-	-	155 289	-	155 289
Other current assets	4 790	-	-	4 790	13 376	18 166
Current financial assets	15 115	237	-	15 352	-	15 352
Other non-current assets	5 427	-	-	5 427	-	5 427
Non-current financial assets	-	1 982	1 848	3 830	-	3 830
Total	281 260	2 219	1 848	285 327

Trade payables	60 636	-	-	60 636	-	60 636
Other current liabilities	65 599	-	-	65 599	46 277	111 876
Current financial liabilities	6 931	435	-	7 366	-	7 366
Non-current financial liabilities	39 272	-	-	39 272	-	39 272
Total	172 438	435	-	172 873

As at December 31, 2024
Cash and cash equivalents	97 166	-	-	97 166	-	97 166
Trade receivables	126 867	-	-	126 867	-	126 867
Other current assets	648	-	-	648	11 776	12 424
Current financial assets	40 000	34	-	40 034	-	40 034
Other non-current assets	2 175	-	-	2 175	-	2 175
Non-current financial assets	181	2 265	5 111	7 558	-	7 558
Total	267 037	2 299	5 111	274 448

Trade payables	39 335	-	-	39 335	-	39 335
Other current liabilities	50 084	-	-	50 084	41 397	91 481
Current financial liabilities	4 728	2 835	-	7 563	-	7 563
Non-current financial liabilities	17 800	-	-	17 800	-	17 800
Total	111 947	2 835	-	114 782

¹⁾Fair value through profit or loss (FVPL)

²⁾Fair value through other comprehensive income (FVOCI)

Other Assets/Liabilities and Financial Assets/Liabilities measured at amortized cost, by class of financial instrument, were as follows:

in CHF 1 000	December 31, 2025	December 31, 2024

Other assets and financial assets at amortized cost
Other receivables	10 217	2 823
Term deposits	15 000	40 000
Other financial assets	115	181
Total	25 332	43 004

Other liabilities and financial liabilities at amortized cost
Accrued volume rebates to customers	34 115	24 385
Payables for property, plant and equipment and intangible assets	6 487	6 987
Other liabilities and accrued expenses	24 997	18 712
Bank loans	14 941	10 119
Lease liabilities	30 912	12 021
Other financial liabilities	350	388
Total	111 802	72 613

The fair values of the financial instruments measured at fair value and the hierarchy level for their measurement were as follows:

	December 31, 2025			December 31, 2024
in CHF 1 000	Level 2	Level 3	Total	Level 2	Level 3	Total

Financial assets at FVPL
Current financial assets - Derivatives	237	-	237	34	-	34
Non-current financial assets - Investments	-	1 982	1 982	-	2 265	2 265
Total	237	1 982	2 219	34	2 265	2 299

Financial assets at FVOCI
Non-current financial assets - Investments	-	1 848	1 848	-	5 111	5 111
Total	-	1 848	1 848	-	5 111	5 111

Financial liabilities at FVPL
Current financial liabilities - Derivatives	435	-	435	2 835	-	2 835
Total	435	-	435	2 835	-	2 835

The derivatives as at December 31, 2025 mature in 177 days or less (2024: 178 days or less).

There were no transfers between the fair value hierarchical levels, and no purchases or sales of investments allocated to Level 3 in 2025 and 2024.

The reconciliation of the Level 3 fair values of non-current financial assets was as follows:

in CHF 1 000	2025	2024

As at January 1	7 376	4 619
Fair value changes recognized in financial result	-283	170
Fair value changes recognized in OCI	-3 263	2 587
As at December 31	3 830	7 376

The unquoted equity instrument measured at fair value through OCI is allocated to Level 3 and relates to a minority investment in an innovative start-up in the heating, ventilation, and air-conditioning systems sector. It was designated as investment at fair value through OCI because this equity instrument represents an investment that the Group intends to hold over the long term for strategic purposes.

The fair value of the equity investment has been estimated using a discounted cash flow model. The valuation requires management to make certain assumptions about the model inputs, including forecast cash flows, the discount rate, credit risk and volatility. The probabilities of the various estimates within the range can be reasonably assessed and are used in management’s estimate of fair value for the non-listed equity investment. The significant unobservable inputs used in the fair value measurement are long-term growth rate for cash flows for subsequent years of 5.0% and WACC of 16.1% (2024: long-term growth rate of 1.0% and WACC of 17.1%). In the reporting period, the Group recognized a loss of CHF 3.3 million in OCI (2024: gain of CHF 2.6 million).

The investment, measured at fair value through profit or loss allocated to Level 3 belongs to a simple agreement for future equity in a start-up in the heating, ventilation, and air-conditioning systems sector.

The Group did not perform any quantitative sensitivity analyses as at December 31, 2025, for the financial instruments measured at fair value, as they are considered to be immaterial.

Fair values are allocated to one of the following three hierarchical levels:

Level 1: quoted prices (unadjusted) in active markets for identical assets or liabilities
Level 2: inputs other than Level 1 quoted prices that are directly or indirectly observable
Level 3: factors that are not based on observable market data

The fair value of derivatives is determined based on input factors observed directly or indirectly on the market (Level 2). The fair value of these instruments is based on forward exchange rates; the positive fair values are included in current financial assets, the negative fair values in current financial liabilities. The changes in fair values recognized in the income statement are included in the financial result.

The fair value measurement of investments in start-up entities is based on non-observable market data, therefore allocated to hierarchy Level 3.

Capital Management

Belimo aims to maintain an equity ratio that is in line with its strategy, and that will remain stable over time to secure the confidence of investors, creditors, and other market players, and to strengthen the future development of its business activities. This entails refinancing that is adapted to the asset structure, and an equity-to-liability ratio that is adequate to the level of risk.

The Board of Directors monitors the shareholder structure and the return on equity. Belimo strives for a diversified and international shareholder base. The return on equity was 30.2% as at December 31, 2025 (2024: 26.4%). The Board of Directors strives to pay a stable or increasing dividend per share, but it may diverge from this policy depending on business development, corporate financing needs, general economic conditions, as well as legal and contractual constraints. The Board of Directors of BELIMO Holding AG will propose a dividend of CHF 10.00 at the Annual General Meeting 2026, which results in a pay-out ratio of 67.7% (2024: 79.6%).

Belimo can buy or sell treasury shares on the market. Its current holdings of treasury shares are not earmarked for any specific purpose and can be sold on the market at any time.

Alternative Performance Measures are described here.

3.3 Financial Assets and Liabilities

3.3Financial Assets and Liabilities

Financial Assets

in CHF 1 000	December 31, 2025	December 31, 2024

Term deposits	15 000	40 000
Derivatives	237	34
Investments	3 830	7 376
Other financial assets	115	181
Total	19 182	47 592

of which current financial assets	15 352	40 034
of which non-current financial assets	3 830	7 558

Term deposits consist of bank deposits with maturities of more than three but less than twelve months from the date of acquisition. Investments comprise an equity investment as well as a simple agreement for future equity in innovative start-ups in the heating, ventilation, and air-conditioning systems sector. In 2025, an immaterial valuation allowance was recognized on other financial assets (2024: immaterial valuation allowance).

Financial Liabilities

in CHF 1 000	December 31, 2025	December 31, 2024

Bank loans	14 941	10 119
Lease liabilities	30 912	12 021
Derivatives	435	2 835
Other financial liabilities	350	388
Total	46 638	25 363

of which current financial liabilities	7 366	7 563
of which non-current financial liabilities	39 272	17 800

Bank loans are entered into locally by subsidiaries, at commercial terms prevailing in the local environment and some are subject to standard financial and non-financial covenants. One subsidiary was in breach of certain financial covenants related to its bank loan as at December 31, 2025; however, this non‑compliance did not affect the classification of the loan as at December 31, 2025 or the related cash flows within the next twelve months.

The changes in financial liabilities were as follows:

in CHF 1 000	2025	2024

As at January 1	25 363	14 822

Interest paid financial borrowings	-310	-332
Interest paid lease liabilities	-505	-403
Repayment of financial borrowings	-341	-30 284
Repayment of lease liabilities	-4 312	-3 955
Proceeds from financial borrowings	6 164	36 140
Movements included in Cash flow from financing activities	694	1 166

Non-cash effective movements lease liabilities	24 736	5 094
Changes in derivatives	-2 400	2 723
Other non-cash effective movements	30	244
Interest expenses financial borrowings	324	353
Interest expenses lease liabilities	505	403
Translation differences	-2 614	557
Non-cash effective movements	20 580	9 375

As at December 31	46 638	25 363

Interest paid not related to financial liabilities and therefore not included in the table above amounted to CHF 0.1 million (2024: CHF 0.8 million).

Management judgment is required to determine the lease liabilities. Further details regarding lease accounting are described in note Property, Plant and Equipment.

The fair value of investments is determined using valuation techniques. The Group uses its judgement to select a variety of methods and make assumptions. For details of the key assumptions used see note Financial Risk Management.

Financial assets are measured at amortized costs, with the exception of investments held at fair value through other comprehensive income as well as investments held at fair value through profit or loss. Derivatives are measured at fair value through profit or loss with any changes therein recognized in the financial result.

Financial liabilities are initially recognized at fair value and subsequently measured at amortized costs using the effective interest method. Interest expense and foreign exchange gains or losses are recognized in profit or loss. Lease liabilities are initially measured at the present value of the lease payments. Derivatives are measured at fair value through profit or loss with any changes therein recognized in the financial result.

3.4 Financial Result

3.4Financial Result

in CHF 1 000	2025	2024

Interest income	240	810
Net gain from derivatives	2 603	-
Other financial income	11	182
Financial income	2 853	992

Interest expenses	-816	-1 024
Net loss from derivatives	-	-4 602
Other financial expenses	-1 269	-949
Financial expenses	-2 085	-6 576

Net foreign exchange result	-10 426	609

Total	-9 657	-4 975

The financial result is composed primarily of interest expenses on borrowings and lease liabilities, interest income, foreign exchange gains or losses, bank charges, fair value changes on financial assets, as well as gains or losses on derivatives. Interest income and expenses are recognized in accordance with the effective interest method.

3.5 Shareholder’s Equity and Earnings per Share

3.5Shareholder’s Equity and Earnings per Share

As per the resolution of the Annual General Meeting of BELIMO Holding AG held on March 24, 2025, a dividend of CHF 9.50 per registered share (2024: CHF 8.50) was paid out on March 28, 2025. In total, a dividend of CHF 116.8 million (2024: CHF 104.5 million) was paid.

	2025	2024

Net income attributable to shareholders of BELIMO Holding AG, in CHF 1 000	181 625	146 782
Average number of outstanding shares	12 299 876	12 298 408
Dividend proposed per registered share¹⁾, in CHF	10.00	9.50
Total dividend proposed¹⁾, in CHF 1 000	123 000	116 850
Earnings per share (EPS), in CHF	14.77	11.94

¹⁾ Proposed by the Board of Directors to the Annual General Meeting

The average number of outstanding shares is calculated based on the number of shares issued, less the average number of treasury shares held.

Share Capital

	December 31, 2025	December 31, 2024

Par value per share, in CHF	0.05	0.05
Outstanding number of shares	12 299 969	12 299 880
Number of treasury shares	31	120
Total number of registered shares	12 300 000	12 300 000

The share capital of BELIMO Holding AG consists of one class of voting rights.

Treasury Shares

Number of shares	2025	2024

As at January 1	120	1 092
Purchases of treasury shares	550	6 880
Treasury shares awarded for share-based payments	-639	-7 852
As at December 31	31	120

Reserves and Retained Earnings

in CHF 1 000	December 31, 2025	December 31, 2024

Currency translation adjustment	-51 197	-30 933
Accumulated FV changes of financial assets at FVOCI	7	2 636
Total other reserves	-51 189	-28 297

Capital reserves	24 362	24 337
Retained earnings	648 061	584 152
Total	621 234	580 192

Shares are a component of equity, as they are not redeemable and there is no dividend guarantee. Treasury shares are recorded as a deduction from equity. Capital reserves correspond to premiums from capital increases, and the gains or losses from treasury share sales as well as from share-based payment awards. Other reserves contain the accumulated foreign exchange differences arising from the translation of the financial statements of foreign Group companies and intercompany loans that form part of a net investment in a foreign operation, as well as the accumulated fair value changes of investments measured at fair value through other comprehensive income (FVOCI). Retained earnings include the remeasurement of the post-employment benefits, as well as remeasurement of share-based payment transactions, and accumulated retained earnings of prior periods.