Sioen Industries : Annual report 2020 - general

Protection through innovation

general report 2020

Dear reader,

Between us, we oſten joke that we are the world's "safety-makers". But there's also a lot of truth to it. We protect thousands of firefighters, police officers, road workers, chainsaw users, sailors and other professionals with top-notch protective clothing. At the same time, our geotextiles protect infrastructure/civil engineering works, our scrims protect buildings, our yarns and fibres protect biodiversity, and our tarpaulins protect trucks and supplies. The list goes on and on.

How do we protect? With the most innovative technical textiles solutions on the market. Indeed, protection through innovation. It's what defines Sioen today, it's what will define us tomorrow.

This brochure will give you a glimpse of how we translate that mission into a diversified offering, a solid strategic approach and responsible business conduct. Visit our website for more info or reach out to experience our #PasSioen to protect.

Best regards,

Michèle Sioen

CEO of Sioen Industries

Where to find us 12

Why we matter 18

How we excel 20

LETTER TO THE STAKEHOLDERS

Dear customers, business partners, employees and shareholders

It has been quite a year. Shortly aſter the death of my mother, co-founder and inspirer of the Sioen group, the Corona storm followed. 2020 became a year in which we couldn't accomplish any of our plans but did everything no one could ever have predicted. It is almost impossible to comprehend that a microscopic virus locked up the entire world.

But it did happen. The world stood still for a moment. All familiar things were lost. In return we got: uncertainties, crisis, fear, change. And not just a little. We were facing one of the greatest challenges since our establishment in 1960.

I am therefore very proud that we got through this unscathed. On top of all this, Sihold (the Sioen family's holding company and largest shareholder) announced its wish to leave the stock exchange in early 2021.

In this exceptional letter to the stakeholders about this exceptional year, there is only one thing leſt to do, which is thanking you.

Together we asked ourselves the question: do we have a product that the world needs right now? Or can we quickly adapt our product portfolio to deliver goods that are urgently needed? And we could.

You are hashtag Sioentalent as it is so beautifully said on social media. You can rightly be proud of that.

Thank you!

Our customers

How you faced the Corona challenges together with us. Our good personal relationships made it possible for us to come up with individual solutions: products, services, credits, … The empathy has always been mutual.

We know each other, each other's children and businesses and so we know what is important to you (and that it is different for other clients). We have been through a lot together, which is what makes our relationship so beautiful. It transcends the purely professional and is more than just another partnership.

Our people

How resilient and agile you have been. How innovative and ingenious. How solution-oriented rather than problem-oriented. How quickly you integrated new media into your daily lives. How quickly you shiſted gears. How you turned the crisis into an opportunity.

In 2020, video calling became our new normal and you have been using our online channels and tools massively. Now we are really looking forward to meeting you again in real life and to saying it in person with a big hug:

Thank you!

Our shareholders

In October 2020, Sihold, the holding company of the Sioen family and main shareholder of the Sioen Industries group, declared its intention to buy back the remaining shares. At the time of publication of this annual report, Sihold holds 93.52%.

We went public in 1996 and had our ups and downs. The stock exchange gave us the means to professionalise and invest. It created brand awareness and gave us the opportunity to attract talent. But there is a time to every purpose. The burdens were greater than the joys. In the last ten years, we have made eight acquisitions and we did not need the stock exchange. It has been good. We will now rely on our own strength. With the same long-term vision that you have come to expect from us, but from now on no longer translated into a share price.

I would like to express my sincere thanks to all our shareholders and investors for your long-standing support of our company.

Thank you!

PasSioen, a family affair

You are all part of the Sioen family story. I am proud that this is more than a business story. It transcends borders, connects people and strengthens communities. From now on you can read about it on our new Sioen CSR website (Corporate Social Responsibility).

It has been proven more than once in 2020: At Sioen, good ideas are always used. Customers are not mere numbers to us. We have room for opinions. There is no room for excruciatingly slow decisions. We respond quickly. We are agile. We rely on people, on knowledge, experience and skills. Sioen, that's you.

Together, we are one Sioen family.

Thank you!

Michele Sioen

CEO Sioen Industries

Inspired by the weaving activities of his father, Jean-Jacques Sioen started a business in technical textiles in 1960. Over the following decades, he and his wife Jacqueline Sioen craſted a remarkable success story. Sioen gradually grew into a highly diversified industrial group with activities in all corners of the world. Today, daughters Michèle, Pascale and Danielle Sioen are the driving force. With more than 4,500 colleagues by their side, they continue the lifework of their parents: shaping the future of technical textiles.

WHO WE ARE

4500+

employees

20+

brands

25+

countries

22

divisions

3

plants

Sioen develops, produces and distributes 10 product groups within the world of technical textiles: from yarns and fibres to protective clothing. A well-balanced mix of organic and acquired brands ensures that we excel in all of them. Technical superiority is what binds us, but it's also a work in progress. With continuous investments in state-of-the-art machinery, innovation and talent, we liſt our product groups to new heights. Quality

and ambition go hand in hand.

WHAT WE DO

Yarns

Tailored high tenacity polyester yarns with specific properties for technical applications such as geotextiles, conveyor belts, marine ropes, offshore mooring, etc.

Part of SIOEN

Woven fabrics

Woven textiles from a variety of raw materials, including polyester, polyamide, para-aramid, meta-aramid, polypropylene, polyethylene and Nomex.

9

Fibres

High tenacity polypropylene fibres for a wide range of non-woven applications in geotextiles: separation of different layers of soil and protection of waterproofing layers in tunnels, channels, ponds, etc.

Films & sheets

Thermoplastic polyolefin films and sheets, produced according to the calendaring procedure resulting in vinyl solutions for walls, ceilings and partitions, and other applications.

Non-wovens

Synthetic geotextile non-wovens for (mainly) civil engineering, automotive and construction purposes, tailored to each client's wishes.

Coated textiles

Textiles treated with up to 6 techniques that allow us to apply any polymer on any carrier in any colour in any width for any application.

Scrims

Customised technical mesh for applications such as roofing reinforcement, geogrids, pool covers, fences, flooring and tapes. Woven, laid and coated.

Protective clothing

About 3 million garments a year, including firefighter clothing, bulletproof vests, lifejackets, chainsaw pants, outdoor wear, high-vis clothing and much more.

Colouring solutions

Colouring solutions such as powders and pigments, for an extensive range of inks, varnishes and pastes - to be found in wallpaper, floors, banners, licence plates, etc.

Services

Framing, laser cutting, welding and complexing of technical textiles, films and foils, as well as extra clothing services such as cleaning and repair of garments.

Our key markets include industry, civil engineering, construction, agriculture and forestry, sports and leisure, maritime, transportation, fire protection, security and automotive. The short answer to where to find us: anytime, anywhere. Look around and you will see Sioen, sometimes strikingly visible, sometimes hidden behind the scenes. To make it more tangible, we take you on a tour for a full day.

Aſter that, you will only see what we see: the Sioen world.

WHERE TO

FIND US

7:03

The early bird gets the worm! It is quite possible that the mattress you wake up on features a protective cover from Sioen.

7:29

In your bathroom, you will find us in your cosmetics. Facial care products, hand creams and shower gels contain seaweed. And for the industrial cultivation of macro-algae, we offer a wide range of high-quality textiles, nets, grids, ribbons and ropes.

8:25

You get into your car. Do you feel it? Sioen is everywhere. Your dashboard, your gearbox, the sun visor, the door panels and airbags likely all contain our coated textiles.

8:47

On the road, it becomes really impressive. Consider the road itself and the plants along it. Or, what about the water basins you pass and the tunnels you drive through? Our geotextiles guarantee structural strength for this infrastructure.

9:03

Do you see any trucks around you? Sioen produces 65% of all textile curtains and roofs for trailer trucks. Or even better: Sioen Chemicals produces the red ink and varnish for all new Belgian number plates. German number plates are also printed with our products.

10:33

If you work in an industrial production facility, it probably breathes Sioen. For example, we supply technical textiles for partitions, roller gates, ventilation pipes and welding curtains. Moreover, there is a good chance that you and your colleagues wear our professional protective clothing.

We are never far away in offices as well. Think of carpet backings, sun blinds, felt acoustic partitions, reinforcement nets in limestone and concrete walls, wallpaper and painting fleeces. Maybe your workplace even has a green textile wall made by Sioen.

12:11

Lunch time! If you feel like eating fish, you will come across Sioen again. Our textile solutions are oſten used in offshore salmon farming and other fish farming, while our protective clothing has been protecting fishermen all over Europe for decades.

13:03

Turn on the radio to listen to the news. Hopefully all is going well in the world, but if otherwise, we come to the rescue with emergency tents, life jackets, inflatable evacuation slides and other rescue equipment.

14:40

The clean energy you rely on in your work area may come from a biogas plant or from a windmill in which you will find our coated textiles.

15:21

Coffee break. With a little luck, you can relax outside for a moment under one of our tensile structures. Tensile and membrane architecture is not only popular in the Middle East, but is also favoured by European architects.

16:05

Your working day is over. Along your drive home, all police officers, firefighters, emergency workers and road workers you may see on the road are likely to be dressed in clothes that are produced by Sioen.

19:35

No matter what you and your family enjoy in your spare time, Sioen participates in it as well. Aſter all, our technical textiles are used in a wide variety of applications, from skating rinks and ski slopes to bouncy castles and party tents.

While doing the dishes, you may be overlooking your neighbour's flat roof. Fact: there's a 75% chance that one of our scrims is incorporated in that roof. Does your kitchen have wall tiles? Our nets keep the tiles together.

17:11

Planning an outdoor weekend? We are going with you! We keep your belongings dry with textiles for high-quality camping tents and award-winning backpacks. Our outdoor clothing brand Baleno also offers hikers a wide range of stylish raincoats, fleece sweaters and much more.

18:57

Supper is almost ready. If you like to add colour to the table with colourful napkins, remember that Sioen Chemicals enables those hues with high-quality colour dispersions.

19:17

What's on the menu? Sioen is active in the agricultural industry with technical textiles for machine protection, warehouses, stables, flexitanks and conservatories. Good to know: we dress thousands of farmers with our Flexothane clothing. In other words, before your food arrived on your plate, we were there.

20:00

The daily news. In the event of any unrest or conflicts, Sioen Ballistics is likely helping to protect people. For example, we safeguard Dutch secret agents, French marines, Viennese law enforcement officers and Belgian soldiers with personal protection products against bullets, knife stabs and other risks.

21:12

When you are lying on your couch watching sports, we'll be on your screen. With sails for the Volvo Ocean race, gymnastics mats or skis for the Olympic Games, rain protectors at Roland Garros or advertising banners during the Tour de France: we are remarkably present at most major sports events.

21:47

Indulge in a cup of tea at the end the day. Guess what? Woven tea bags are made by Sioen.

22:20

Time for bed, sleep tight! Sioen watches over you: our products are in the insulation material in your walls, in the reinforcement nets in your vinyl floor and in the ink of your wallpaper.

Transportation rail & roadAir tra icForestry & agriculture

Waste Wmaasnteagmeamneangtem

Marine & maritime

Energy

Em

ent

Leisure & sportsIndustry & manufacturing

ergenEcmyesregrevniceys& mseedrivciacles & medical

Construction & engineeringTelecom, utilities (water, gas, electricity) & banking

Food & beverage

Since the early days of Sioen, our technical textiles have protected people and their belongings.

In short, we provide peace of mind. We do so by focusing on top-notch quality, but also by anticipating major industrial and societal changes, and adapting our offering accordingly. Current megatrends are shaping tomorrow's world and creating new challenges. We ensure that our technical textiles help to overcome several of them.

WHY WE

MATTER

Corporate slogan

Protection through innovation

Mission

Sioen protects people and their belongings with high-quality technical textiles and professional protective clothing.

Vision

To shape the future of technical textiles

Our technical textiles make a difference

©Zone Midwest

Our business model is based on 5 strategic pillars that are closely intertwined: sustainable growth, innovation, vertical integration, customer focus, corporate social responsibility and market leadership. Together, these priorities offer Sioen an exceptional level of resilience, as demonstrated throughout the coronavirus crisis. But our customers are the ones who profit most from these long-standing strategic focal points. Aſter all, we only excel when they excel.

HOW WE

EXCEL

SUSTAINABLE GROWTH

With continuous investments in organic growth and acquisitions, we inspire long-term partnerships across the value chain.

INNNOVATION

Our 220-strong R&D team, active in internal and open innovation, helps customers to pioneer in difficult niche markets.

MARKET LEADERSHIP

As a market leader, we attract the best talent, keep prices under control and leverage our scale to deliver the best possible service.

VERTICAL INTEGRATION

By organising the entire production process in-house, we offer our customers unrivalled flexibility and quality assurance.

CUSTOMER FOCUS

Open communication, co-development, proactive support and a multidisciplinary approach are all part of the deal.

PEOPLE MAKE THE DIFFERENCE

Everything you've read before is the culminating result of investments and all the innovative efforts, dedication and enthusiasm of our employees. They make it all happen, flexible and resilient with an "everything is possible" attitude. #Sioentalent

Sioen actively contributes to a better world - not by simply doing as much as we can, but by using distinct anchor points that give our group direction.

More concretely, 4 guiding principles help us to identify initiatives that have clear added value: the 5 Ps, the SDGs, 7 Sioen focal points and our trust in certificates and memberships. Moreover, this approach guarantees to our customers that they are dealing with a socially responsible supplier.

FOR A BETTER

WORLD

CSR - DECLARATION IN RESPECT

OF NON-FINANCIAL INFORMATION

CSR.SIOEN.COM

The 5 Ps of corporate social responsibility

People

Planet

Prosperity

Partnerships

Peace

The United Nation's 17 SDGs for 2030

Certificates and memberships

Sioen focal points

Energy management Sustainable products Resource efficiency Waste management Employee centricity Charity

Credentials

CARBON FOOTPRINT

The total carbon footprint of Sioen in 2020 was 34 830 tCO2e for direct emissions (scope 1 & scope 2) with 5 912 tCO2e for upstream emissions from fossil fuel and electricity losses (scope 3).

Share of emissions by scope (in %)

■ Scope 1 74%

■ Scope 2 12%

■ Scope 3 14%

Natural gas is the largest emission source (83%; 28 894 tCO2e) followed by electricity consumption

(14%; 4 748 tCO2e). Emissions related to mobility (fuel for company cars and forkliſt trucks) are limited to 3%.

Total direct emissions, by emission category Share of emissions, by emission category (in %)

■ Natural gas 77%

■ Electricity 20%

■ LPG 2%

■ Gasoline 1%

■ Diesel 2%

The Coating Division represents the largest part of Sioen's emissions (90% of direct emissions) and 63.5% of the group's turnover.

Share of Sioen emissions by divisions

The global carbon footprint can be compared with day-to-day activities:

■ Coating	90%	38 724 tCO2e =
4 976 times around the world with the average car
■ Apparel	8%	1 194 ha of new forest needed each year to capture
this amount
■ Chemicals	2%	7 764 return flights Brussels-New-York (economic class)

Sioen direct CO2 emissions 2016-2020, per emission category

2016

2017

2018

tCO2e

■ Natural gas

■ Electricity ■ Diesel

■ Gasoline ■ LPG

2019

2020

When we look at the emissions per division, we see a decrease compared to 2019 in all divisions.

Within the coating division, there is a decrease in total emissions, despite the acquisition at the end of 2019 of a French coating company, responsible for 2 850t CO2 direct emissions on an annual basis.

Detailed direct emission categories evolution by Sioen division (tCO2)

50 000

45 000

40 000

35 000

30 000

25 000

20 000

15 000

10 000

5 000

2016 2017

2018 2019	2016 2017 2018 2019 2020	2016 2017 2018 2019 2020
Coating	Chemicals	Apparel
■ Natural gas

2020

■ Electricity

■ Diesel

■ Gasoline

■ LPG

On the one hand, investments were made in CO2 offsetting in Germany, amounting for 1 675 tCO2.

Furthermore, the share of green electricity continues to increase. In 2020, 79% of all electricity purchased was of green origin.

When we express direct emissions per FTE, we see a similar evolution.

CO2 KPI evolution	2017	2018	2019	2020
Total CO2 per employee (scope 1 & 2) 12.8 8.1 9.8 7.2
Total share green electricity (%) 3.0% 75.5% 77.0% 78.6%
Total mobility emissions per employee 0.3 0.3 0.3 0.24
kgCO2e/m² produced 0.32 0.27 0.26 0.24
kgCO2e/kg produced 0.22 0.05 0.11 0.05
kgCO2e/lm produced 0.20 0.04 0.04 0.03
kgCO2e/piece produced 2.23 2.53 2.42 2.67

The annual calculation of our carbon footprint makes it possible to closely monitor the evolution of our CO2 emissions and performance. Thanks to the share of green electricity that increased from 3 to 77% and efforts at all levels, direct emissions per FTE and per production volume decreased significantly since 2017.

SIOEN INDUSTRIES NV Fabriekstraat 23 B-8850 Ardooie Belgium

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