To our Shareholders
Management Report
Consolidated Financial Statements
BRENNTAG ON THE STOCK MARKET SHARE PRICE PERFORMANCE At the beginning of 2016, stock prices on equity markets around the world declined significantly, due mainly to low oil prices and uncertainty about the growth of the Chinese economy. After a period where share prices recovered, volatility increased again around the middle of the year as attention turned to the upcoming referendum on the United Kingdom’s membership of the European Union. The vote for “Brexit” came as a surprise to most market participants, putting pressure on global capital markets. However, equity markets quickly stabilized and showed a positive trend overall in the following months. The US presidential election resulted in a short period of high volatility, but the major indices then regained confidence and share prices started to rise. The European Central Bank launched its capital market-friendly corporate bond purchase programme in 2016 and in December announced an extension. In contrast, the US Federal Reserve raised interest rates in 2016. On the currency markets, the US dollar remained at strong levels. Oil prices increased in the course of the year. In this environment, Germany’s two leading indices, the DAX® and the MDAX®, made a weak start into 2016, but then stabilized in the course of the year and started to rise towards yearend, finally closing up above the prior yearend. The DAX® closing level of 11,481 at the end of 2016 represents an increase of 6.9% on the beginning of the year and the MDAX® gained 6.8% to close at 22,189 points. Brenntag shares closed at EUR 52.80, up 9.4% on the beginning of the year. According to Deutsche Börse AG’s ranking, Brenntag AG ranked 32 nd among all listed companies in Germany by market capitalization at the end of 2016. The average number of Brenntag shares traded daily on Xetra® in 2016 was approximately 291,000 compared with around 285,000 in the prior-year period. TO O\bR SHAREHO\fDERS BRENNTAG ON THE STOCK MARKET 8 FINANCIAL REPORT DVGXSRENNTAM AM BRENNTA\b IN DIALO\bUE WITH THE CAPITAL MARKET Our Investor Relations activities aim to deliver a fair communication policy that affords equal treatment to all stakeholders. Through openness and transparency, we wish to raise awareness of our shares as an attractive investment and further increase Brenntag’s standing on the capital market. We communicate our company’s business performance and strategy both continuously and reliably. This further strengthens investors’ trust in Brenntag and enables us to ensure that our shares con tinue to be fairly valued on the capital market. In 2016, we again attached significant importance to personal contact with capital market participants. The Board of Management and the Investor Relations team were in constant dialogue with investors and analysts worldwide. We discussed the company’s business performance in detail in numerous meetings at road shows, investor conferences and other occasions such as our capital markets day and the Annual General Shareholders’ Meeting. In addition to the above-mentioned activities, the Board of Management and the Investor Relations team regularly provided investors, analysts and private shareholders with information on Brenntag AG in numerous phone calls. We provide comprehensive and up-to-date information on the Brenntag shares and the outstanding bonds in the Investor Relations section of the website at www.brenntag.com. In the coming year, we will continue to present the company at numerous road shows and capital market events. You will find the latest list of dates in our financial calendar in the Investor Relations section of the Brenntag website. Further information at www.brenntag.com under Investor Relations Brenntag AG Corporate Finance & Investor Relations Phone: + 49 (0) 208 7828 7653 E-mail: IR@brenntag.de A.01 BRENNTAG SHARE PRICE PERFORMANCE (INDEXED) brenntag mdax® \f \f \b TO O\bR SHAREHO\fDERS BRENNTAG ON THE STOCK MARKET 9 LATINMT ERLCT20IECR 1 LER0R1E06 4I0IM2MRI4 4 20R05M2MRI TM9CTI 0 IC CAT 4N0TMNC67MT4 6 LATITNAIM ERC2E0 16459ERTT0I7 I7 LATINMT ERLCT20IECR 1 LER0R1E06 4I0IM2MRI4 4 20R05M2MRI TM9CTI 0 IC CAT 4N0TMNC67MT4 6 LATITNAIM ERC2E0 16459ERTT0I7 I7 A.03 KEY DATA ON THE BRENNTAG SHARES Dec. 31, 2015 Dec. \f1, 2016 No. of shares (unweighted) 154,500,000154,500,000 Pr ice (Xetra® closing pr ice) 48.2852.80 Market capitalization EUR m 7, 4 5 98,158 Pr imary stock exchange Xetra® Indices MDA X®, MSCI, Stoxx Europe 600 ISIN / WKN / trading symbol DE000A1DAHH0 / A1DAHH / BNR SHAREHOLDER STRUCTURE As at March 1, 2017, notification had been received from the following shareholders under Section 21, para. 1 of the German Securities Trading Act (WpHG) that their share of the voting rights now exceeds the 3% or 5% threshold: A.02 SHAREHO\fDER STR\bCT\bRE The notifications are available at www.brenntag.com/ voting_rights_ announcements Shareholder Interest in %Date of notification BlackRock >5October 18, 2016 Norges Bank >5September 2, 2016 Sun Life / MFS >5July 3, 2012 Allianz Global Investors >3November 25, 2016 Threadneedle >3June 27, 2016 TO O\bR SHAREHO\fDERS BRENNTAG ON THE STOCK MARKET 10 140602465 789fi73 TEXAS780036P 6P 8B\bY 11HO\fD 3SE\f\f ANALYSTS’ OPINIONS Currently (as at March 1, 2017), 22 banks regularly publish research reports on our company’s latest performance and give recommendations. Eight analysts give Brenntag shares a buy recommendation, eleven recommend holding the shares and three are advising to sell. Many analysts value Brenntag highly as a growth stock with strong cash flow generation.A.04 ANA\fYSTS’ OPINIONS Current analysts’ opinions at www.brenntag.com/ analysts_opinions CREDITOR RELATIONS Brenntag’s strong credit profile is reflected in investment grade ratings from two international rating agencies: Standard & Poor’s has assigned a “BBB” rating (outlook: stable) and Moody’s has assigned a “Baa3” rating (outlook: stable). A.05 KEY DATA ON THE BONDS OF THE BRENNTAG GRO\bP Bond 2018 Bond (with Warrants) 2022 Issuer Brenntag Finance B.V.Brenntag Finance B.V. Listing Luxembourg stock exchange Frankfurt Open Market (Frankfurt Freiverkehr) ISIN X S 0 6 459 41419DE000A1Z3XQ6 Aggregate principal amount EUR m400USD m 500 Denomination EUR1,000USD 250,000 Minimum transferrable amount EUR50,000USD 250,000 Coupon %5.50 1.875 Interest payment July 19Semiannual June 2 / Dec. 2 Maturity July 19, 2018Dec. 2, 2022 TO O\bR SHAREHO\fDERS BRENNTAG ON THE STOCK MARKET 11 LATINMT ERLCT20IECR 1 LER0R1E06 4I0IM2MRI4 4 20R05M2MRI TM9CTI 0 IC CAT 4N0TMNC67MT4 6 LATITNAIM ERC2E0 16459ERTT0I7 I7 LATINMT ERLCT20IECR 1 LER0R1E06 4I0IM2MRI4 4 20R05M2MRI TM9CTI 0 IC CAT 4N0TMNC67MT4 6 LATITNAIM ERC2E0 16459ERTT0I7 I7 E\bR 1.05 dividend proposal 2016 \bENERAL SHAREHOLDERS’ MEETIN\b The 2016 Annual General Shareholders’ Meeting of Brenntag AG was held in Düsseldorf on June 14, 2016. Based on the Board of Management’s report on the company’s performance in financial year 2015 and the Group’s future strategy as well as the general discussion, the shareholders present were able to gain a comprehensive picture of Brenntag AG. 74.13% of the share capital of 154,500,000 shares was represented. The Annual General Shareholders’ Meeting approved the distribution of a dividend of EUR 1.00 (previous year: EUR 0.90) per share. The payout ratio was 42.3% of the consolidated profit after tax for 2015 attributable to shareholders of Brenntag AG. ATTRACTIVE DIVIDEND PROPOSAL FOR 2016 It is Brenntag’s declared policy to pay its shareholders an attractive dividend each year. The company now aims to distribute 35% –50% of its consolidated profit after tax attributable to shareholders of Brenntag AG. The Board of Management and Supervisory Board will recommend to shareholders at the General Shareholders’ Meeting a dividend payment of EUR 1.05 per share. The payout ratio on the basis of the consolidated profit after tax for the year attributable to shareholders of Brenntag AG is therefore 45.0%. Through this payout ratio, we would like our shareholders to participate directly in the company’s positive cash flow performance. TO O\bR SHAREHO\fDERS BRENNTAG ON THE STOCK MARKET 12 140602465 789fi73 TEXAS780036P 6P 1.2 1.0 0.8 0.6 0.4 0.2 0 2014 0.90 20130.87 20120.80 2011 0.67 2010 0.47 2015 1.00 in eur 2016 dividend pro posal 1.05 A.06 DIVIDEND PERFORMANCE TO O\bR SHAREHO\fDERS BRENNTAG ON THE STOCK MARKET 13 1406250 78190fi36798 17838T73E X6365fi586X fi383A5fi586 05S906 69 940 X230529EP50X 140602465 789fi73 TEXAS780036P 6P 1406250 78190fi36798 17838T73E X6365fi586X fi383A5fi586 05S906 69 940 X230529EP50X 140602465 789fi73 TEXAS780036P 6P