Market Risk

The Group assesses the probability and quantitative magnitude of potential financial losses arising from market uncertainties, volatility, or unexpected developments associated with financial instruments.

Currency Risk

The Group generates its income predominantly in CHF, while a small proportion of cash outflows are denominated in foreign currencies, primarily EUR and USD. On a consolidated basis, the currency risk is not considered material. Therefore, the Group does not use financial instruments to manage currency-related risks. Similarly, translation risk related to the assets and liabilities of foreign subsidiaries is limited due to low volumes and is generally not hedged, as it is not considered material.

Interest Rate Risk

The Group’s interest rate risk primarily arises from its outstanding floating rate credit facility, which exposes the Group to fluctuations in cash flows and increased volatility in profit before tax. However, the Group’s overall interest rate exposure remains low relative to profit before tax.

The floating interest rate is determined by both the movement of SARON and a predefined margin, which is influenced by the Group’s leverage ratio (refer to Liquidity Risk). Based on its risk assessment, the Group has not identified a need to use interest rate derivatives to hedge its exposure to floating interest rates.

The following table illustrates the sensitivity to a reasonably possible change in interest rates for the Group’s financial assets and liabilities. All things being equal, the Group’s profit before tax is affected by changes in variable interest rates as follows:

The range between the highest and lowest Swiss National Bank base interest rates observed in 2025 was 0.5%. As this was below the threshold of one percentage point, the Group applied the minimum rate change of ±1% in its sensitivity analysis.