These unaudited financial statements are the interim condensed consolidated financial statements of Tecan Group Ltd. and its subsidiaries (together referred to as the ‘Group’) for the six-month period ending June 30, 2020. The financial statements are prepared in accordance with International Accounting Standard (IAS) 34 ‘Interim Financial Reporting’ and should be read in conjunction with the consolidated financial statements 2019 as they provide an update of previously reported information. The interim condensed consolidated financial statements were authorized for issue on August 10, 2020.

The preparation of these interim condensed consolidated financial statements requires management to make assumptions and estimates that affect the reported amounts of revenues, expenses, assets, liabilities and disclosure of contingent liabilities at the date of these interim condensed consolidated financial statements. If in the future such assumptions and estimates deviate from the actual circumstances, the original assumptions and estimates will be modified as appropriate in the period in which the circumstances change.

The Group operates in industries where significant seasonal or cyclical variations in total sales are not experienced during the financial year. 

Income tax expense is recognized based on the best estimate of the weighted average annual income tax rate expected for the full financial year.

The global health and economic crisis resulting from the COVID-19 pandemic affects the Group in its day-to-day operations. The related impacts encompass a significant change in product mix as well as cost effects. For example, with numerous laboratories closed in most of the countries, the local service teams had no or only limited access to the customers sites particularly in April and May. Therefore, the service cost center was showing higher under- absorption, reflecting the under-utilization of the installation and service department. In addition, the Group had to accept higher freight costs caused by the partial cessation of flight operations and other restrictions on international trade. Also, an increase in safety stocks was required to limit the impact of any supply chain interruptions for production. On the other hand, travel spend went down, partly offsetting the adverse costs mentioned above.

The Group has also seen a significant increase in order entry due to higher demand mainly for Liquid Handling instruments and respective consumables as a result of the pandemic. This led to increased sales albeit with significant shifts in the product mix due to changes in the business environment of its customers.

The accounting policies used in the preparation of the interim condensed consolidated financial statements are consistent with those followed in the preparation of the consolidated financial statements 2019, except for the adoption of the following new or revised/amended standards and interpretations, effective as from January 1, 2020: 

1. IAS = International Accounting Standards, IFRS = International Financial Reporting Standards, IFRIC = Interpretations as by the IFRS Interpretations Committee (formerly International Financial Reporting Interpretations Committee)

The adoption of the conceptual framework and amended standards did not result in substantial changes to the Group’s accounting policies.

The following new and revised/amended standards and interpretations have been issued, but are not yet effective and are not applied early in these interim condensed consolidated financial statements:

1. IAS = International Accounting Standards, IFRS = International Financial Reporting Standards, IFRIC = Interpretations as by the IFRS Interpretations Committee (formerly International Financial Reporting Interpretations Committee)

The changes, individually and in the aggregate, are not expected to have a significant impact on the balance sheet, results of operations and cash flows of the Group upon adoption.