Report of the Executive Board

Dear Shareholders and Business Partners,

Fiscal 2015 was particularly successful for Sartorius. With revenue up 16.0% and an increase in underlying EBITDA by 40.9%, we have grown even more strongly and profitably than we had projected before year-end. Consolidated sales exceeded the one billion mark for the first time, reaching €1.1 billion with an underlying earnings margin of 23.6%.

This very encouraging performance is due to the exceptionally strong growth of our Bioprocess Solutions Division, which recorded double-digit gains for the fifth year in succession. The division reported an uptick in sales of 20.9% and an earnings margin of 26.5%. As a key supplier and partner of the biopharmaceutical industry, we are well-positioned with this division in a dynamic and innovative sector. Many of our customers have received approvals over the past years for new biopharmaceuticals, which they are now manufacturing in relatively large quantities. Sartorius supplies the production technology required for this, above all, consumables.

Regionally, Bioprocess Solutions expanded the most in North America, as expected. Here, we outperformed the market yet again and thus gained further market share. The acquisitions of the companies BioOutsource Ltd. and Cellca GmbH enabled us to extend our offerings for the process development phase. Both purchases alone offer attractive growth prospects, especially considerable synergy potential for our existing products and services.

The Lab Products & Services Division that supplies premium lab instruments and consumables also performed well and attained its targets. The division's sales revenue rose 5.0% and its earnings margin climbed to 16.0%. Lab Products & Services made significant progress in executing on sales initiatives. Its direct sales and e-business were further expanded and our presence on the lab market strengthened. The newly launched products and, from a geographic perspective, business in the Asia|Pacific region showed especially positive development.

We also made considerable headway in implementing our multi-year infrastructure program: The new building for the manufacture of laboratory instruments in Goettingen is nearing completion for occupation. At the same location, we extended membrane production capacities. Our new facility for single-use lab products is about to start up operations in Stonehouse, UK. We also fast-tracked preparations for extending additional international production facilities in line with strong demand, focusing on our filter and bag manufacture in Yauco, Puerto Rico.

In view of our excellent results, the Supervisory Board and the Executive Board will submit a proposal at the Annual Shareholders' Meeting on April 7, 2016, to raise dividends to €1.52 per preference share and €1.50 per ordinary share. After we already reported strong gains in our share prices over the past years, Sartorius preference shares, which were up more than 140% in the reporting year, were among the winners in the TecDax. The price of our ordinary shares even tripled within the same period.

Supported by the strong growth of the biopharma market, we see good prospects for our business in 2016 and have accordingly set ambitious targets. We plan to increase sales revenue in constant currencies by approximately 10% to 14% and our underlying EBITDA margin by one percentage point. Both divisions and all regions are expected to contribute to this development. We will continue to execute on our infrastructure program and therefore project that our capex ratio of about 10% of sales revenue will continue to be slightly above the long-term average.

What are our mid-range plans? In 2011 when we defined our Sartorius 2020 strategy, we identified the regions and technologies with the most attractive growth and earnings potential and, on top of this, set ourselves ambitious financial targets. Today, after five years and about midway on our home stretch, we can give a positive assessment. We are on track with our sales growth and even much further ahead in expanding our profitability.

Against this background, we confirm our revenue target of €2 billion in constant currencies for the year 2020. We have increased our margin target for 2020 by 3 to 4 percentage points to 26% to 27% based on constant currencies and assuming that the profitability of future acquisitions will be at a level comparable to that of our existing business.

At this point, I would like to sincerely congratulate all our staff on this highly successful year and to thank them for their exceptionally hard work and personal contribution to this success. Dear shareholders, customers and business partners, I would like to express my appreciation to you again for your trust, often extending back many years. We cordially invite you to continue with us on our road to further success as an innovative and highly profitable technology group.


Yours sincerely,

Dr. Joachim Kreuzburg
CEO and Executive Board Chairman