LETTER TO SHAREHOLDERS.

Tecan is navigating a challenging market environment marked by reduced spending in our target markets, leading to lower demand in both the Life Sciences and Partnering Business segments. These challenges have been compounded by general market weakness in China and specific customer-related factors. In response, we have implemented a comprehensive cost reduction program and optimized our global operations to reinforce our leading position. The long-term trends in healthcare remain unchanged: from life science research to clinical applications, automation and innovation are crucial for scaling healthcare solutions in research, clinical diagnostics, and medtech. This is especially important amid rising healthcare costs, ultimately benefiting people worldwide. With our dedicated team, we are driving exciting innovations and look forward to launching promising new products across both businesses, positioning us well to capitalize on market recovery as conditions improve.

In 2024, reduced spending in the biopharmaceutical industry led to decreased demand for life science research instruments, affecting both the Life Sciences Business and the Partnering Business. Additionally, a general market weakness in China impacted both direct sales and indirect business through global OEM customers. In the Partnering Business, sales were further influenced by specific customer-related factors, including normalized demand patterns following inventory replenishment by a key customer in 2023. As a result, reported sales for the Group in fiscal year 2024 decreased by 13.0% in Swiss francs, totaling CHF 934.3 million (2023: CHF 1,074.4 million). In local currencies, sales were 11.5% below the prior-year period, aligning with the revised sales outlook from October 2024, which anticipated a decline of 12-14%. Sales in the second half decreased by 12.3% in Swiss francs and by 11.3% in local currencies compared to the prior-year period. These sales results were previously communicated in a trading statement on January 8, 2025. 

Adjusted EBITDA¹ (operating profit before depreciation and amortization) was CHF 164.4 million, down from CHF 220.6 million in 2023. The adjusted EBITDA margin decreased to 17.6% of sales (2023: 20.5%), aligning with the revised margin outlook of 16-18%. The decline was primarily due to lower sales volumes, as profitability is highly volume-dependent. However, profitability was supported by a comprehensive cost-reduction 

program. Additionally, exchange rate movements in major currencies against the Swiss franc negatively impacted the margin by approximately 40 basis points.

Adjusted net profit² was CHF 103.1 million, down from CHF 164.4 million in 2023, when earnings were significantly boosted by a one-time positive effect related to transitional measures from the Swiss tax reform. Adjusted earnings per share were CHF 8.08, compared to CHF 12.88 in 2023.

Cash flow from operating activities was CHF 148.5 million, compared to CHF 160.6 million in 2023. Cash conversion improved to 100.0% of reported EBITDA (2023: 77.5%). Thanks to solid cash flow management, Tecan's net liquidity position (cash and cash equivalents plus short-term time deposits, less bank liabilities, loans, and the outstanding bond) increased to CHF 153.7 million as of December 31, 2024, up from CHF 112.6 million on December 31, 2023.

Details on the course of business of the Life Sciences Business and Partnering Business segments and regarding the regional development of sales are discussed in the Chief Financial Officer’s Report on page 135.

1. The adjusted operating profit before depreciation and amortization excludes restructuring costs as well as acquisition- and integration-related costs (+CHF 16.4 million)
2. The calculation of 2024 adjusted net profit and adjusted earnings per share excludes restructuring costs as well as acquisition- and integration-re- lated costs (+CHF 16.4 million) and accumulated amortization of acquired intangible assets (+CHF 19.0 million) and they were calculated with the reported Group tax rate of 13.6%.

In 2024, Tecan enhanced its operational resilience by implementing a comprehensive cost-reduction program and continuing to optimize its global organizational footprint. Following the successful transfer of Cavro component production to facilities in Morgan Hill, California, and Penang, Malaysia, and the closure of the San Jose site in 2023, Tecan relocated its genomic reagents site from Redwood City to the expanding Morgan Hill hub at the end of 2024. In Penang, Tecan successfully passed an extensive FDA inspection, laying a strong foundation for future production of medical devices, including class 3 devices. The first medical device production was successfully transitioned to Penang in 2024. Alongside site consolidation, Tecan focused on supply chain optimization and increased vertical integration of manufacturing to leverage the Group's full capabilities and realize cost synergies.

On the commercial front, Tecan established a direct sales office in South Korea in 2024 by acquiring a long-standing distributor in the region. This new entity includes team members with over 20 years of experience working with Tecan, bringing valuable local market knowledge to better serve this growing market.

In 2024, Tecan advanced its product portfolio with significant launches in genomics, proteomics, and cell biology. Examples include the Resolvex i300 module, introduced in February, which enhances throughput in proteomics by integrating with the Fluent® platform, and the Spark Cyto 3D, which supports drug discovery by enabling the analysis of complex 3D cell models. During a Capital Markets Day in October 2024, Tecan previewed Veya, a multiomics liquid handling workstation that simplifies lab automation and boosts productivity. Officially launched at the Society for Laboratory Automation and Screening (SLAS) international conference in San Diego, USA, in January 2025, Veya provides effortless automation by overcoming key barriers in lab automation.

Tecan also expanded its digital ecosystem with the new Introspect analytics platform, enhancing operational insights and service efficiency. This digital expansion benefits customers across both business segments.

At the 2024 Capital Markets Day, Tecan highlighted its strong Partnering Business relationships and robust project pipeline across its three business lines: Synergence™, Cavro^®, and Paramit. Examples include Tecan's collaboration with Illumina in the Synergence line, supporting their expansion into multiomics with the development of a new system. Through Paramit, Tecan assisted THINK^® Surgical with the design transfer and initiated the manufacturing of their TMINI^® miniature robotic system, cart, and smart cell charging station. Additionally, Paramit is manufacturing the Avive Connect AED, an innovative and user-friendly automated external defibrillator aimed at improving survival rates for sudden cardiac arrest.

The pipeline of new development projects has been further enriched through joint selling of Synergence, Cavro, and Paramit services, targeting key customers in the life sciences, lab diagnostics, and Medtech segments. Tecan aims to double new project signings by 2027 through joint selling efforts, a targeted approach, and strategic account management.

Tecan's 2024 Sustainability Report, published as part of the Annual Report, includes a Climate Risk Scenarios Analysis, highlighting the company's proactive approach to addressing transition and physical risks related to climate change. In preparation for the EU Corporate Sustainability Reporting Directive (CSRD), Tecan has integrated related data management into its Finance function. For the first time, Tecan's financial auditors conducted a limited assurance audit of key 2024 environmental and social data points. Further progress was made towards greenhouse gas emissions reduction commitments, with renewable sources accounting for 87% of all electricity purchased. In 2025, Tecan will continue its pragmatic approach to managing risks and opportunities associated with the company's material topics. The 2024 Sustainability Report can be found starting on page 40.

Based on the solid cash flows for the full year 2024 and on the basis of an ongoing positive business outlook, the Board of Directors will propose at the Company’s Annual General Meeting on April 10, 2025, an unchanged dividend of CHF 3.00 per share. Half of the dividend, i.e., CHF 1.50, will again be paid out from the available capital contribution reserve and is therefore not subject to withholding tax.

The overall market environment is showing first signs of stabilization after a significant decline in demand last year, with further improvements expected over the course of 2025. However, new political uncertainties have emerged, including the announced reductions to the National Institutes of Health (NIH) research budget in the US, which could further impact demand for life science research instruments. For 2025, Tecan anticipates that the year will begin with continued softer market conditions, with potential improvement as the year progresses. Depending on the extent of this improvement in the second half, the market could turn slightly positive for the full year, driven by specific growth segments, such as the clinical diagnostics market. 

The outlook 2025 does not take account of potential acquisitions during the course of the year. 

The expectations regarding profitability are based on an average exchange rate forecast for full year 2025 of one euro equaling CHF 0.95 and one US dollar equaling CHF 0.90.

Tecan also reiterated its mid-term outlook, in which the company anticipates returning to average organic growth rates in the mid to high single-digit percentage range in local currencies under normal market conditions, while continuously improving profitability.

On behalf of the Board of Directors and the Management Board, we thank everyone at Tecan for their continued efforts and resilience in these more challenging times, and we recognize and appreciate the adaptability and resolve of our outstanding teams. We would also like to extend our appreciation to our customers and shareholders for their continued trust and support as we navigate Tecan through the year ahead.

Männedorf, March 7, 2025