Annual report 2014

Report of the Supervisory Board

FRANZ HANIEL & CIE. GMBH

Dear Sir or Madam,

2014 was yet another year that brought key changes for our family-owned company Haniel: the sale of the entirety of our Celesio investment to the healthcare services provider McKesson was wrapped up with a good outcome and the reduction of debts began in the previous year was largely completed. This means that Haniel can once again turn its attention towards investing in future growth. The Supervisory Board advised the Management Board on these issues, which are of fundamental importance for the future success of the Company, in four ordinary and two extraordinary meetings. One further resolution was passed by way of circulation.

CHANGES ON THE SUPERVISORY BOARD

The sale of Celesio resulted in changes in the composition of the Supervisory Board: In January 2014, the Supervisory Board resolved to reduce the number of members from 16 to 12. This reduction in the size of the Board reflects the significant decrease in the number of employees of the Group following the Celesio sale.

Employee representatives Manfred Breitenstein and Thomas Römer from Celesio left the Supervisory Board as at 6 February 2014. Christoph Böninger and Baron Wolf von Buchholtz left the Supervisory Board at the conclusion of the Shareholders’ Meeting on 26 April 2014. Christoph Böninger had been a standing member of the Supervisory Board since 2003 and aside from providing competent and far-sighted advice to the Company, he was also a driving force behind the shareholder qualification programme and strengthened the ties between the family and the company. He will remain Chairman of the Advisory Board. Baron Wolf von Buchholtz has been a member of the Supervisory Board since 1998 and has left the Board on account of age. In the past 16 years, he consistently provided critical and constructive advice on the development of the family-owned company and was a competent and important advisor when it came to transforming the portfolio. The Supervisory Board thanks everyone for their committed, trusting and open collaboration.

TRANSPARENCY IN COOPERATION

As in years past, the cooperation between the Supervisory Board and the Management Board was characterised by an atmosphere of great openness and mutual trust. The Management Board informed us regularly about the status of the Haniel Holding Company and the Group as a whole – also with regard to important individual events. In accordance with my duty as Chairman of the Supervisory Board of Franz Haniel & Cie. GmbH, beyond the normal meetings, I have also been in regular contact with the Chairman of the Management Board primarily, but also with the CFO. We discussed important business and strategic issues affecting the group.

The Supervisory Board continually and carefully monitored the group of companies’ management and business development based on regular written and oral reports of the Management Board. We examined in depth all the decisions requiring our consent and passed the necessary resolutions.

The Audit Committee held four meetings in the 2014 reporting period. It monitored the accounting process and the effectiveness of the internal control system, the risk management system, the Internal Auditing office, and the compliance management system. Moreover, the committee examined and confirmed the independence of the auditor of the financial statements, and resolved, in its meeting on 26 April 2014, to recommend to the Shareholders’ Meeting to re-appoint the previous auditor.

ANNUAL SEPARATE AND CONSOLIDATED FINANCIAL STATEMENTS APPROVED

PricewaterhouseCoopers Aktiengesellschaft Wirtschaftsprüfungsgesellschaft, Essen, audited the annual financial statements of Franz Haniel & Cie. GmbH and the Report of the Management Board for the 2014 financial year. The auditors confirmed that the annual financial statements and Report of the Management Board comply with legal provisions and the Company’s articles of association. The auditors issued an unqualified auditors’ report on the annual financial statements and the Report of the Management Board. The auditors also issued an unqualified auditors’ report on the consolidated financial statements and the Group Report of the Management Board. The auditors participated in the Supervisory Board’s meeting on the financial statements and in all meetings of the Audit Committee. Furthermore, the Supervisory Board again engaged the auditors to assess the Haniel Group’s early risk identification system. This voluntary examination was conducted in accordance with section 317 (4) of the German Commercial Code (Handelsgesetzbuch, “HGB”). The auditors verified the suitability of the system to detect early any risks endangering the going concern assumption.

The Management Board submitted the consolidated financial statements, the Group Report of the Management Board and the Group auditors’ report for 2014 to the Supervisory Board for its examination. Following an in-depth examination, the Supervisory Board approved the consolidated financial statements and the Group Report of the Management Board. The Supervisory Board also approved the annual financial statements of Franz Haniel & Cie. GmbH and the Management Board’s profit appropriation proposal. The annual financial statements are thereby adopted and the consolidated financial statements approved.

GRATITUDE FOR A JOB WELL DONE

In the context of a coordinated strategic plan, Haniel has once again turned its attention to investing in new business areas. The Management Board and Supervisory Board are working closely together on this. The Supervisory Board thanks the Management Board and the employees for their faithful collaboration and looks forward to advancing the growth in Haniel’s value together with them.

Duisburg, 10 April 2015

FRANZ HANIEL & CIE. GMBH

Franz M. Haniel
Chairman of the Supervisory Board