Executive Board Evaluation of Overall Risk

The Executive Board bases its estimate of the overall risk situation on the risk management system in place. The system compiles all risks identified by our divisions, corporate departments and regional entities, and is regularly reviewed by the Executive Board and handled by the Audit Committee. Essentially, it was the risk affecting pensions that rose during 2016. Due to currently rising prices for crude oil and coal, procurement-market risks are higher compared with the previous year. The timely commissioning of the production facilities at the Charleston site meant investment risks decreased during the reporting year. In our view, the overall risk is roughly the same as a year earlier.

As of this report’s publication date, the Executive Board does not see any individual or aggregate risk that could endanger WACKER’s future in any material way. Market risks do still exist in the photovoltaic industry, which is dominated by overcapacity, low prices and intra-sector consolidation. Thanks to our extensive product portfolio and our sound regional footing, though, we see good opportunities for expanding our leading market positions and achieving further growth. We remain confident that WACKER is strategically and financially so well positioned that we can take advantage of any opportunities that arise.