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Heidelberg standardizes company pension scheme

The Management Board and employee representatives of Heidelberger Druckmaschinen AG (Heidelberg) and the IG Metall trade union today reached agreement on the restructuring of the company pension scheme for the employees in German companies.

A collective bargaining agreement brings together the previous pension arrangements of the German Heidelberg Group. In addition, a uniform dynamization of company pensions was agreed upon, which is based on the expected lower inflation. This makes the development of pensions more predictable for employees, pensioners and the company and at the same time reduces administrative costs.

The new regulation leads to a reduction in the expected future pension increases and, with a positive effect of around €65 million on the operating result (EBITDA), strengthens the company's equity in the current first quarter of the financial year.

"The adjustment of the company pension plan is the next important step, which on the one hand provides clarity and predictability for our deserving employees and on the other hand contributes to the sustainable financial stabilization of Heidelberg," said Marcus A. Wassenberg, CFO and Labor Director of Heidelberg.

With this new regulation, IG Metall and Heidelberg are addressing the structural problems of the existing company pension system. "The legal framework conditions and the continuing low interest rate phase are presenting many companies in Germany with major challenges, including Heidelberg. With this step, we have fundamentally addressed the structural challenges in connection with the company pension system. With our agreement, we have now reached a sustainable arrangement for all employees and pensioners alike," said Mirko Geiger, First Senior Representative of IG Metall, Heidelberg. "The agreements that have now been reached are a good example of how companies can solve the existing challenges with regard to company pensions."

With this step, the company is also reacting to the historically low interest rates in the euro area, which will lead to further increases in provisions for pension obligations in the future. Damping future pension increases therefore has a positive effect on rising pension obligations.

"With the revision of the company pension scheme, employee representatives and the Management Board have once again reached a constructive agreement that contributes to the future viability of our company. We are thus addressing structural problems in the pension system that are placing a significant burden on the company, while at the same time making the system future-proof," said Ralph Arns, Chairman of Heidelberg's Works Council.

Until July 24, 2020, the contract is subject to a committee reservation by IG-Metall.