2.4 Earthquake in Türkiye and global economic and geopolitical uncertainties

On February 6, 2023, a devastating earthquake occurred in southern Türkiye and northern Syria. This region is home to an important part of the Turkish textile industry and thus represents a key market for Rieter. The earthquake had a significant impact on Rieter’s top line. Sales to and order intake from Türkiye decreased in 2023 and particularly in 2024 due to a lack of investment in new machinery and systems in combination with further postponements and cancellations of existing orders. The property damage at Rieter’s repair center and the financial loss incurred due to business interruption have been evaluated in cooperation with the respective insurance company. The insurance claim for property and inventory damage at Rieter’s repair center and the financial loss incurred from business interruption has been settled in the amount of CHF 14.0 million. In 2024, the compensation was allocated to the consolidated income statement in the line items cost of sales and other income.

Rieter’s business activities in Ukraine, Russia, Belarus, and the Middle East are not significant. Consequently, the military conflicts in Ukraine and the Middle East have no direct impact on Rieter, as neither subsidiaries (assets) nor major customers are based in this region.

Against this background, Rieter has reviewed the areas involving material accounting estimates and judgments (see note 1.2) to assess the impact of the earthquake in Türkiye and the global economic and geopolitical uncertainties. The results of this review are included in the respective notes. In addition, the earthquake in Türkiye and the global economic and geopolitical uncertainties had no significant impact on any other balance sheet line items at December 31, 2024 (at December 31, 2023: none).