20 24 Annual Report
2 Annual Report - 2024 01 The Company Page 4 04 Research and Innovation Page 18 02 The Shareholders Page 8 03 Sustainability Page 12 05 Digitalisation Page 22
3 Annual Report - 2024 Index Report on the 53rd business year, 2024 06 Gas Transportation Page 26 07 HSE Page 34 08 Easement Agreements Page 38 09 Human Resources Page 40 10Finance Page 50
The Company Annual Report - 2024 4
5 Annual Report - 2024 The company’s purpose is to construct, maintain and operate a natural gas transport system that stretches from the northern to the southern border of Switzerland and, since 2017, also transports gas in the reverse direction. Additionally, the company permits usage of this transport system by FluxSwiss Sagl and Swissgas AG or their subsidiaries under a lease agreement. The company has leased its facilities to FluxSwiss Sagl and Swissgas AG for use. Available transport capacity is allocated to those companies according to a fixed distribution key. The company builds and operates this transport system, which is connected to several transfer stations that Swissgas largely operates. It is empowered to take all measures related to achieving its corporate purpose, including acquiring, managing and disposing of real estate and participating in other companies, both at home and abroad. In addition, Transitgas AG can itself build a telecommunications network along this transport system or permit a third party to undertake such construction. The company can establish branches at home and abroad. However, distribution of natural gas in Switzerland is precluded. Transitgas AG was founded on 25 June 1971 and was entered in the Commercial Register of the Canton of Zurich on 28 June 1971. The company is headquartered in Zurich. 01
6 Annual Report - 2024 In light of global and national efforts to reduce CO2 emissions and achieve carbon neutrality, Transitgas AG is faced with the challenge and opportunity to redefine its role in energy transportation. The integration of innovations in the areas of hydrogen (H2) and digitalisation offers promising prospects for the future. The company was established for an indefinite term. Because of the capital reduction on 27 June 2018, the share capital amounts to CHF 10,000,000, divided into 46,000 fully paid registered shares of CHF 100 each for Class A and 54,000 fully paid registered shares of CHF 100 each for Class B. The shareholders of Transitgas AG are Swissgas AG (51%), FluxSwiss Sagl (46%), and Uniper Global Commodities SE (3%). SWISSGAS AG FLUXSWISS SAGL UNIPER GLOBAL COMMODITIES SE 3% 46% 51%
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The Shareholders Annual Report - 2024 8
9 Annual Report - 2024 Swissgas AG, a Swiss joint-stock company for natural gas based in Zurich, holds a 51% stake in the share capital of Transitgas AG. The company was founded on 7 April 1971. Its share capital amounts to CHF 60 million. Swissgas has the following shareholders: Gaznat SA, Lausanne, Erdgas Ostschweiz AG, Zurich, Gasverbund Mittelland AG, Arlesheim, Erdgas Zentralschweiz AG, Lucerne, and the Association of the Swiss Gas Industry, Zurich. The purpose of the network operator company Swissgas, in cooperation with the four regional companies, is to ensure the security of supply on the transportation side and guarantee competitive network operations, as well as safeguard related interests at home and abroad. Additionally, Swissgas has been operating the Swiss coordination centre for gas pipeline transmissions for years. Swissgas is involved in Transitgas operations and has transport capacities. Furthermore, Swissgas operates its own 260-kilometre-long high-pressure network from the intake or customs measurement stations along the Transitgas system all the way to the transfer stations into the regional networks. In 2024, Swissgas transported approximately 19.5 TWh of gas through the Swissgas customs measurement stations into Switzerland (of which approximately 8.3 TWh was transported via the Swissgas network to the regional networks) and approximately 0.13 TWh in transit through Switzerland. Swissgas AG 02
10 Annual Report - 2024 FluxSwiss Sagl, with its registered office in Paradiso (Lugano TI), holds 46% of the share capital of Transitgas AG. FluxSwiss commercialises 90% of the capacity of the Transitgas pipeline and is owned by Fluxys Europe (50.65%), EIP Gas Invest II (formerly CSEIP Gas Invest II) (36.56%) Swiss Gas Invest (7.89%) and Swissgas (4.9%). Headquartered in Belgium, Fluxys is a fully independent energy infrastructure group with 1,300 employees active in gas transmission and storage and liquefied natural gas terminalling. Through its associated companies across the world, Fluxys operates 28,000 kilometres of pipeline and liquefied natural gas terminals, totalling a yearly regasification capacity of 450 TWh. As a purpose-led company, Fluxys, together with its stakeholders, contributes to a better society by shaping a bright energy future. Building on the unique assets of its infrastructure and its commercial and technical expertise, Fluxys is committed to transporting hydrogen, biomethane or any other carbon-neutral energy carrier. It likewise carries CO2, with considerable work in its capture, usage, and storage. FluxSwiss Sagl
11 Annual Report - 2024 storage facilities with a capacity of more than 7 billion cubic metres. Uniper aims to be carbon neutral by 2040. To achieve this, the company is transforming its own power plants and facilities and investing in flexible and reliable power generation assets. Uniper is already one of the largest operators of hydroelectric power plants in Europe and is further expanding solar and wind energy as key drivers for a more sustainable and secure future. Uniper is gradually enhancing its gas portfolio with renewable and low-carbon gases such as biomethane and is developing a hydrogen portfolio aimed at long-term conversion. The company plans to offset remaining CO2 emissions through high-quality carbon compensations. Uniper’s trading activities help connect global energy markets. These activities encompass the entire energy commodity supply chain in power, emissions allowances, natural gas, LNG, coal and freight. Uniper sources, stores, transports and supplies physical commodities such as pipeline gas, LNG and coal on a global scale. Its trading business also manages the risks inherent in its regional power and gas portfolios. Moreover, the company’s existing partnerships, international presence and wide-ranging expertise in global commerce form the basis of extensive service packages. Uniper can provide systems management, and its services can extend to the supply of raw materials and fuels, as well as the management of resources. Uniper Global Commodities SE Uniper Global Commodities SE (UGC), Düsseldorf, has a 3% stake in the share capital of Transitgas AG. Uniper is a European energy company with a global reach, headquartered in Düsseldorf and operating in over 40 countries. With approximately 7,500 employees, the company plays a significant role in ensuring energy supply security in Europe, especially in its core markets of Germany, the United Kingdom, Sweden, and the Netherlands. Uniper’s activities include power generation in Europe, global energy trading, and a broad gas portfolio. Uniper procures gas -including liquefied natural gas (LNG) - and other energy sources from global markets. The company manages gas
Sustainability Annual Report - 2024 12
13 Annual Report - 2024 03 Transitgas AG funds specific projects for sustainable development in society, the environment and business. Transitgas AG supports projects with a funding programme that aims to strengthen sustainable development in the regions of the transport system. The projects contribute to an ecologically sustainable society and economy in these regions, with a focus on CO2 reduction and renewable energies. During the reporting year, no new projects were intentionally funded, as the existing funding strategy was being fundamentally revised. The aim of this realignment was to refine the criteria and improve the program’s long-term impact. This laid the groundwork for more effectively supporting sustainable initiatives in the future. Funding of Projects to Promote Sustainability Social Environment Investment (SEI)
14 Annual Report - 2024 New Habitats for Reptiles along the Transitgas Pipeline As part of our work on the Transitgas pipeline, we have made a valuable contribution to nature conservation in the municipality of Guttannen. Through the project “Ersatzmassnahme TRG Hoflöe” we have created a new habitat for reptiles. Photo from 26/02/2024 Photo from 04/04/2024
15 Annual Report - 2024 The project involved several specific measures: Removal of Spruces and Reduction of Deciduous Trees: While rare mixed tree species were preserved, a large number of spruces and deciduous trees such as birches and maples were cut down. Forest Protection Measures: The resulting wood was processed into brush piles according to the guidelines of the Office for Forests and Natural Hazards, providing shelter and habitats for small animals. Key Measures in Detail: Manual Motorised Logging: Using felling aids, the logging was carried out carefully to protect the remaining trees, especially old maples, serviceberries, and linden trees. Thinning of the Forest: This measure was implemented to increase sunlight on the rockslide area, thereby maintaining its function as a desirable habitat for reptiles. Results and Sustainability The result is a forest with good light and open areas that provide ideal conditions for reptiles and other small animals. Through efforts like these, our work not only contributes to supply security but also positively impacts local biodiversity. We are also pursuing a sustainable approach. In ten years, we will review the site to determine if further work is needed to ensure the long-term impact of the project.
16 Annual Report - 2024 Emissions reduction As a responsible company committed to achieving its climate goals, Transitgas AG continued to significantly reduce its greenhouse gas (GHG) emissions in 2024. This considerable reduction was made possible by a range of already implemented measures, as well as by regular inspections of potential fugitive emission points, which were promptly repaired following detection. The entire infrastructure of Transitgas – including pipelines and station piping – undergoes a leak-tightness inspection at least once a year. In 2024, this inspection was once again successfully carried out. Even the smallest leaks, such as those at the more than 20,000 detachable flange connections, were identified. Any necessary sealing was performed immediately or scheduled as part of the maintenance program. At the compressor station in Ruswil, as part of a pilot project an online monitoring system was installed to detect leaks at an early stage and enable immediate repairs in order to continue limiting emissions.Annual measurements of fugitive emissions are planned to ensure targeted repairs can be carried out, aiming to reduce such emissions to the lowest level possible. In 2024, a CHARM survey (airborne laser-based methane detection) was also conducted in addition to the annual leakage measurements, covering both pipeline sections and compressor stations. Technician during the measurement of fugitive emissions
17 Annual Report - 2024
Research and Innovation Annual Report - 2024 18
19 Annual Report - 2024 Transitgas AG is convinced that hydrogen will play a key role in the decarbonisation process and in the energy supply of the future. To proactively prepare for this energy transition, Transitgas AG is exploring various options for transporting hydrogen in and through Switzerland. Different scenarios have been examined to ensure the secure supply of both natural gas and hydrogen for transit and domestic use in Switzerland. These scenarios consider both the repurposing of existing high-pressure natural gas pipelines and the construction of new dedicated pipelines. Hydrogen – H2 04
Transitgas AG presented its repurposing concept to ERI for the assessment of material suitability. Both parties accepted, and the concept was even incorporated into the ERI guidelines. This important first step enabled Transitgas AG to begin testing materials to demonstrate the hydrogen compatibility of its pipelines. The concept for repurposing existing pipelines for hydrogen transport is being further developed in collaboration with the authorities, and in particular with ERI. Annual Report - 2024 20
21 Annual Report - 2024 Tunnel and 48” pipeline of Transitgas AG
Digitalisation Annual Report - 2024 22
23 Annual Report - 2024 Digitalisation continues to play a pivotal role in optimising our business processes and meeting the evolving demands of our industry. In 2024, we focused on three key areas to advance our digital transformation: the full renewal of workplace computers, the development of a new architectural framework for our On-Premise data centres, and the formulation of a comprehensive cybersecurity strategy for our Operational Technology (OT). Throughout the year, our ICT operations remained stable, secure and available around the clock. 05 Modernisation of Workplace Computers An important milestone in the modernisation of our ICT infrastructure was the complete renewal of workplace computers. Legacy systems were replaced with AI-compatible laptops, offering enhanced performance and enabling the seamless integration of artificial intelligence into daily workflows. This initiative significantly boosted employee productivity and ensures we remain well-equipped for future technological developments.
24 Annual Report - 2024 Another strategic focus in 2024 was the design of a new architectural framework for modernising our On-Premise data centres. The concept aims to enhance performance and reliability while reducing operational costs through virtualisation. Of particular importance is our data centre, which is required to maintain full functionality even in the event of a nationwide power outage lasting up to two weeks. By leveraging cutting-edge technologies and best practices, we are ensuring our data centres meet the highest standards and form a robust foundation for our digital business operations. New Architectural Framework for On-Premise Data Centres
25 Annual Report - 2024 Cybersecurity Strategy for Our Operational Technology (OT) The security of our digital assets remains a top priority. In 2024, we developed a comprehensive cybersecurity strategy specifically for our Operational Technology (OT). This strategy includes a wide range of measures designed to ensure the availability, confidentiality and integrity of our OT systems. Key initiatives include regular security audits, the implementation of advanced security technologies, and ongoing training for our employees to handle potential cyber threats effectively. Our approach is aligned with the Swiss “Minimum Standard for ICT Security in Gas Supply”, which will become mandatory for all gas suppliers in Switzerland starting in 2025. We are living in the age of artificial intelligence (AI). In just a few short years, AI has made remarkable progress and become integrated into many aspects of our lives. Yet, amid the excitement surrounding its potential, one fundamental question arises: Where can AI deliver real value for Transitgas AG? Often, the high costs of implementation and operation of AI infrastructure pose greater challenges than the technology itself. As a small company with limited personnel and technical resources, Transitgas AG is well advised to collaborate with industry leaders such as Fluxys in the field of AI. We are proud of the digital advancements achieved in 2024 and are confident that our efforts will deliver lasting value to our shareholders. The continued development of our digital capabilities is essential to meeting the industry’s evolving challenges and securing our competitive edge. We thank our shareholders for their trust and ongoing support on this journey. Outlook
Gas Transportation Annual Report - 2024 26
27 Annual Report - 2024 The transport capacities of the Transitgas system are divided between the two shareholders Swissgas AG and FluxSwiss Sagl. They manage the transport capacity for approx. 18 billion normal cubic metres from Wallbach, Germany and approx. 8 billion normal cubic metres from Oltingue, France. Since 2017, a transport capacity of approximately 13 billion normal cubic metres per year has been available in the reverse flow from Gries Pass (Italy) to Switzerland, Germany and France. Furthermore, transport capacities of approximately 8 billion standard cubic metres per year are provided between France and Germany. 06
28 Annual Report - 2024 Injections into Transitgas are shown as positive, withdrawals from Transitgas as negative. 2023 2024 Δ 109 Nm³ TWh 109 Nm³ TWh % IMPORTS FROM Germany through Wallbach 1.838 21.13 0.891 10.23 -52% France through Oltingue 5.997 68.51 6.367 72.79 6% Italy through Gries Pass 0.239 2.77 0.012 0.14 -95% IMPORTS TOTAL 8.074 92.41 7.270 83.16 -10% EXPORTS TO Germany through Wallbach -0.483 -5.52 -0.140 -1.54 -72% France through Oltingue -0.052 -0.60 0.000 0.00-100% Italy through Gries Pass -5.949 -68.02 -5.429 -62.10 -9% EXPORTS TOTAL -6.484 -74.14 -5.569 -63.64 -14% Delivered to Switzerland -1.596 -18.30 -1.707 -19.52 7% Transitgas Own consumption -0.005-0.05-0.001 -0.00-88%
Feed-in to Switzerland in 2024: 7.270 billion Nm3 Withdrawals from Transitgas in 2024 [109 Nm3/Year] Exit Gries Pass (I) 5.249 Exit Schweiz 1.707 Exit Wallbach (D) 0.136 29 Entry Oltingue (F) 6.367 Entry Wallbach (D) 0.891 Entry Gries Pass (I) 0.012 Annual Report - 2024
30 Annual Report - 2024 Gas flows 2015–2024 In the reporting year, the total volume of transported natural gas amounted to 7.270 billion Nm3. The Ukraine crisis has continued to impact operations in 2024, as it did in 2022 and 2023. The most notable effect has been the full utilisation of capacity at the Oltingue border crossing point on the Swiss-French border. A large part of the gas imported from France through Oltingue was transported toward the Gries Pass in Italy. In contrast, the volume of gas transported toward Germany decreased compared to 2023. Direct gas deliveries from Oltingue (France) to Wallbach (Germany) frequently occurred on weekends, when industrial demand in neighbouring Italy decreased. Imports from Wallbach (Germany) were primarily used to meet domestic Swiss demand. The 7% increase is mainly attributable to higher consumption driven by lower outdoor temperatures. Transit gas flows between Wallbach (Germany) and the Gries Pass (Italy) have only occurred on a few days and in limited quantities
31 Annual Report - 2024 Gas transport quantities 2015 - 2024 [109 Nm3/Year] Import through Oltingue (F) Import through Wallbach (D) Import through Gries Pass (I) Export through Gries Pass (I) Export through Wallbach (D) Export through Oltingue (F) Export Switzerland (CH) 15.00 10.00 5.00 0.00 -5.00 -10.00 -15.00 2020 2024 2015 2016 2017 2108 2019 2021 2022 2023
32 Annual Report - 2024 Monthly Gas feed-in 2023 / 2024 [109 Nm3/Month] 1.200 1.000 0.800 0.600 0.400 0.200 0.000 2023 2024 Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec
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HSE Health, Safety & Environment Annual Report - 2024 34
35 Annual Report - 2024 Transitgas AG has an integrated management system for HSE (Health, Safety and the Environment) in place and has been certified according to internationally recognised standards, namely ISO 45001 (Occupational Health and Safety) and ISO 14001 (Environmental Management), since February 2010. The management system provides the organisation with tools for preventing work-related injuries and illness among employees. The aim is to provide a safe and healthy workplace for workers. Transitgas AG systematically avoids work-related hazards and minimises health and safety risks by taking effective preventive and protective measures. In addition, the management system provides a framework for protecting the environment and responding to changing environmental conditions, in accordance with socio-economic requirements. Together with all the relevant stakeholders, Transitgas AG’s procurement department ensures that all purchased goods and services meet our company standards. Furthermore, we are committed to working together with our suppliers to develop concepts for the continuous improvement of sustainability and occupational safety along our supply chains. Human rights, health, safety and sustainability standards are verified during all our purchasing activities. This includes new purchasing projects and tenders, ongoing supplier performance management and the onboarding process for new suppliers. 07
36 Annual Report - 2024 Accordingly, processes for supplier management are part of the HSE management system. The HSE-System takes a process-based approach to allow company activities in Health, Safety and Environment at work to be better understood, better controlled and continuously improved. The relevant certifications demonstrate that Transitgas AG meets all the requirements under the legal regulations and the corresponding standards. In June 2024, the existing environmental certification according to the ISO 14001:2015 and ISO 45001:2018 standards for occupational health and safety were successfully audited to completion. This allowed the ISO 14001 and ISO 45001 certifications to be extended for another 3 years. Transitgas is committed to sustainable climate protection. With its participation in the EnAW (Energy Agency of the Swiss Private Sector) programme, the company is striving to actively reduce CO2 emissions and optimise energy efficiency. The target agreement is recognised by the Swiss federal government, the cantons and business partners. Furthermore, Transitgas AG continues to work toward achieving carbon neutrality by 2035.
Easement Agreements Annual Report - 2024 38
39 Annual Report - 2024 During the construction of the first Transitgas pipeline from Wallbach to Ruswil, the federal government granted a 50-year concession for the operation of the high-pressure natural gas pipeline. Timelimited easement agreements were concluded with landowners for the same duration. As a result, the initial agreements began expiring in 2022/23. The renewal contracts now have a compensation period limited to 25 years, aligning with the typical generational cycle on farms. In accordance with recommendations from the Swiss Farmers’ Union, compensation for the pipeline construction rights, including the operation of the raw pipeline system and associated telecommunications cable, was set at CHF 14.50 per linear metre. The finalised easements were notarised and subsequently entered into the land register with no time limitation. In total, new easement agreements were concluded for approximately 78.8 km of the TRG 1 pipeline. The willingness of landowners to cooperate and enter into agreements was largely undisputed, as the process involved contract renewal without any construction-related interventions on the properties. 08 Canton Aargau Canton Basel- Landschaft Canton Solothurn Canton Luzern Total TRG1 149 82 70 134 435 Concluded Agreements by Canton:
Human Resources Annual Report - 2024 40
41 Annual Report - 2024 09 Transitgas AG is working to promote and support the professional development of its employees through ongoing training to acquire and maintain the increased and evolving expertise needed for our industry. In 2024, our staff completed a total of 2,704 hours of training and continuing education. Staff development The geographical distribution of our staff of 52 employees in 2024 was as follows: Workforce 40 Lucerne (Ruswil) 07 Zurich (Zurich) 03 Bern (Meiringen) 02 Wallis (Oberwald)
42 Annual Report - 2024 Anniversaries during the reporting year 35 years of service 25 years of service Herbert Grossmann Mechanical Plants Sepp Lagger OC & Patroller 20 years of service Francesco Guaricci Section Leader Mechanical Plants Renato Ritz OC & Patroller 15 years of service
43 Annual Report - 2024 10 years of service 10 years of service 10 years of service Marcel Burkart E&I Lorenzo Reguzzoni Dispatching Operator Biljana Trajkovik Services Zurich & Accounting Retirement in 2024 Markus Stirnimann ERP-Operator Congratulations! The Board of Directors and Management would like to thank all employees for their service and commitment over the past year.
Company Organs Beat Badertscher* Attorney at Law, Zurich CHAIRMAN Stephan Marty* Swissgas AG, Zurich DEPUTY CHAIRMAN Peter Verhaeghe* Fluxys, Brussels Ruedi Rohrbach* Swissgas AG, Zurich MEMBER Jvo Grundler* Energy Infrastructure Partners AG, Zurich René Bauz Gaznat SA, Vevey Andreas Bolliger Erdgas Ostschweiz AG, Zurich Steve Turner Fluxys, Brussels Arthur Janssen Gasverbund Mittelland AG, Arlesheim Etienne Schön Energy Infrastructure Partners AG, Zurich Gérard Kimus Fluxys, Brussels Christian Janzen UNIPER Global Commodities SE, Düsseldorf BOARD OF DIRECTORS, BOARD COMMITTEE OBSERVER Annual Report - 2024 44
45 RESIGNED FROM THE BOARD OF DIRECTORS AND BOARD COMMITTEE André Dosé* Swissgas AG, Zurich on June 30, 2024 Nicolas Daubies Fluxys, Brussels on October 31, 2024 * Also, in the Board Committee René Bautz Gaznat SA, Aigle on December 31, 2024 Annual Report - 2024
46 TECHNICAL COMMITTEE Rafael Van Elst Fluxys, Brussels CHAIRMAN Raoul Raffagli FluxSwiss Sagl, Paradiso (Lugano) MEMBER Lorenzo Dondi FluxSwiss Sagl, Paradiso (Lugano) Sebastian Hoff Fluxys, Brussels Peter Massny Swissgas AG, Zurich André Martin Gasverbund Mittelland AG, Arlesheim Patrik Schmid Erdgas Ostschweiz AG, Zurich Gilles Verdan Gaznat SA, Aigle RESIGNED FROM THE TECHNICAL COMMITTEE Lorenzo Dondi FluxSwiss Sagl, Paradiso (Lugano) on September 30, 2024 Gilles Verdan Gaznat SA, Aigle on December 31, 2024 Annual Report - 2024
47 Ennio Sinigaglia CEO Danilo Angelini Head of ICT and Digitalization AUTHORIZED SIGNATORIES Paolo Beretta HSE Manager / Innovation & Development Michaela Böhm Head of Finance & Administration EXTERNAL AUDITORS Florian Linder Head of Technics Rachel Ott Head of HR & Communication Deloitte AG, Zurich Annual Report - 2024
Finance Annual Report - 2024 50
51 Annual Report - 2024 10 We have audited the financial statements of Transitgas AG (the Company), which comprise the balance- sheet as at 31 December 2024 and the profit and loss statement, the cash flow statement for the year then ended, and notes to the financial statements, including a summary of significant accounting policies. In our opinion, the financial statements for the year ended 31 December 2024 comply with Swiss law and the Company’s articles of incorporation. Report on the Audit of the Financial Statements OPINION We conducted our audit in accordance with Swiss law and Swiss Standards on Auditing (SA-CH). Our responsibilities under those provisions and standards are further described in the “Auditor’s Responsibilities for the Audit of the Financial Statements” section of our report. We are independent of the Company in accordance with the provisions of Swiss law, and the requirements of the Swiss audit profession, and we have fulfilled our other ethical responsibilities in accordance with these requirements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion. BASIS FOR OPINION
52 Annual Report - 2024 Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor’s report that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with Swiss law and SA-CH will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these financial statements. A further description of our responsibilities for the audit of the financial statements is located on EXPERTsuisse’s website at: https://www.expertsuisse.ch/en/auditreport. This description forms an integral part of our report. AUDITOR’S RESPONSIBILITIES FOR THE AUDIT OF THE FINANCIAL STATEMENTS The Board of Directors is responsible for the preparation of the financial statements in accordance with the provisions of Swiss law and the Company’s articles of incorporation, and for such internal control as the Board of Directors determines is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error. In preparing the financial statements, the Board of Directors is responsible for assessing the Company’s ability to continue as a going concern, disclosing, as applicable, matters related to going concern, and using the going concern basis of accounting unless the Board of Directors either intends to liquidate the Company or to cease operations, or has no realistic alternative but to do so. BOARD OF DIRECTORS’ RESPONSIBILITIES FOR THE FINANCIAL STATEMENTS
53 Annual Report - 2024 In accordance with Art. 728a para. 1 item 3 CO and PS-CH 890, we confirm that an internal control system exists, which has been designed for the preparation of the financial statements according to the instructions of the Board of Directors. Based on our audit in accordance with Art. 728a para. 1 item 2 CO, we confirm that the proposal of the Board of Directors complies with Swiss law and the Company’s articles of incorporation. We recommend that the financial statements submitted to you be approved. REPORT ON OTHER LEGAL AND REGULATORY REQUIREMENTS DELOITTE AG Jan Meyer Licensed Audit Expert ExpertAuditor in Charge Aude Salord Licensed Audit Expert ExpertAuditor in Charge Zurich, 11 March 2025
54 Annual Report - 2024 BALANCE SHEET AS PER 31 DECEMBER Notes 31.12.2024 31.12.2023 Assets Cash 3.1 23’276’764 29’649’236 Trade receivables shareholders 1’933’314 1’941’350 Other current receivables third party 972’720 988’843 Inventories 3 3 Accrued income and prepaid expenses 263’226 366’100 Total current assets 26’446’028 32’945’532 Shareholdings 1 1 Tangible fixed assets 3.2 489’037 284’780 Technical equipment, thereof 3.4 30’133’306 24’147’042 Gas Pipeline and related equipment 25’368’034 21’133’046 Work in progress 4’765’272 3’013’997 Land 3’480’954 3’575’270 Intangible fixed assets 3.3 3’848’674 3’848’674 Total non-current assets 37’951’972 31’855’767 Total assets 64’398’000 64’801’299
55 Annual Report - 2024 Notes 31.12.2024 31.12.2023 Liabilities Trade creditors 914’214 1’286’971 Other current liabilities 536’886 523’672 Deferred income and accrued expenses 3.5 5’545’626 5’468’929 Total current borrowed capital 6’996’726 7’279’571 Provisions 3.6 6’031’192 6’202’645 Total long-term borrowed capital 6’031’192 6’202’645 Equity Share capital 3.0 10’000’000 10’000’000 Capital Contribution Reserve 33’000’000 33’000’000 Statutory retained earnings 6’129’082 6’129’082 Voluntary retained earnings 2’241’000 2’190’000 Total shareholders’ equity 51’370’082 51’319’082 Total Liabilities and Shareholders’ Equity 64’398’000 64’801’299
56 Annual Report - 2024 PROFIT AND LOSS STATEMENT FOR THE FINANCIAL YEAR Notes 2024 2023 Income from lease agreement 17’977’576 17’779’820 Other income 1’333’666 1’490’767 Total operating income 19’311’242 19’270’587 Staff costs (7’281’036) (7’098’992) Electricity (392’721) (343’157) Maintenance costs (5’445’108) (5’734’897) General and administrative costs (1’706’666) (1’460’627) Depreciation on fixed asset items (2’557’370) (1’976’906) Total operating result (17’382’901) (16’614’579) Operating profit 1’928’341 2’656’009
57 Annual Report - 2024 Extraordinary income 840’684 - Extraordinary expense 3.7 (63’046) - Total extraordinary result 777’638 - Direct taxes (709’300) (694’000) Annual profit 2’241’000 2’190’000 Annual profit before tax 2’950’300 2’884’000 Notes 2024 2023 Financial income 338’032 293’994 Financial expenses (93’711) (66’002) Total financial result 244’321 227’991
58 Annual Report - 2024 CASH FLOW STATEMENT FOR THE FINANCIAL YEAR Notes 31.12.2024 31.12.2023 Annual profit 2’241’000 2’190’000 Depreciation on fixed assets items 2’557’370 1’976’906 Net increase (decrease) in provisions 3.6 (171’453) (226’355) Decrease / (increase) in trade receivables shareholders 8’035 (40’736) Decrease / (increase) other current receivables third party 16’123 (272’377) Decrease / (increase) in accrued income and prepaid expenses 102’874 (82’835) Increase / (decrease) in trade payables and other short-term liabilities (359’542) 711’114 Increase / (decrease) in accrued expenses and deferred income 3.5 76’697 1’625’806 Cash inflow from operating activities 4’471’102 5’881’523 (Purchase of) property, plant and equipment (8’747’890) (2’734’696) Disposal of property, plant and equipment 94’316 - Cash outflow from investment activities (8’653’574) (2’734’696)
59 Annual Report - 2024 Notes 31.12.2024 31.12.2023 Distribution of profits to shareholders (dividends) (2’190’000) (2’282’000) Cash outflow from financing activities (2’190’000) (2’282’000) Net (decrease) / increase in cash (6’372’472) 864’828 Cash As at January 1 3.1 29’649’236 28’784’409 As at December 31 3.1 23’276’764 29’649’236 Changes in cash (6’372’472) 864’827
60 Annual Report - 2024 NOTES TO THE FINANCIAL STATEMENTS 2024 Transitgas AG (“the Company”), was founded on 25 June 1971 and was entered in the Commercial Register of the Canton of Zurich on 28 June 1971. The Company is headquartered at Franklinstrasse 27, 8050 Zurich. The purpose of the Company is to construct, maintain and operate a natural gas transport system which stretches from the northern to the southern border of Switzerland, as well as transfer usage of this transport system to FluxSwiss Sagl and Swissgas AG or one of their subsidiaries under a lease agreement. The company has leased its facilities to FluxSwiss Sagl and Swissgas AG for use. Available transport capacity is allocated to FluxSwiss Sagl and Swissgas AG according to a fixed distribution key. The Company builds and operates this transport system, with multiple transfer stations, on Swiss territory. It can take all measures related to achieving its corporate purposes, acquire, manage and dispose of real estate and participate in other companies both at home and abroad. In addition, the Company itself can build a telecommunication network along this transport system or permit a third party to undertake such construction. The company can establish branches at home and abroad. However, distribution of natural gas in Switzerland is precluded. Share capital amounts to CHF 10’000’000, grouped into 46’000 fully paid-up registered shares of CHF 100 each in class A and 54’000 fully paid-up registered shares of CHF 100 each in class B. The number of full-time equivalents did not exceed 50 (p/y: 50) on an annual average basis. 1. GENERAL INFORMATION In order to identify risks and opportunities as early as possible,Transitgas AG regularly reviews factors that may affect the entire business environment, both internally and externally. This review is based on the financial data determined for the financial statements according to the Swiss Code of Obligations and the key risk indicators in accordance with regulatory requirements. A key component of this is the design and further development of the internal control system, which is used to address identified risks with the relevant, Risk assessment
61 Annual Report - 2024 appropriate control measures and minimise the likelihood of them occurring. The appropriate use of risk management and control processes, which guarantee the identification, assessment, management, monitoring and communication of single risks and risk areas, ensures that all risks can be taken into account accordingly. One of the main objectives is to gain an understanding of the risks early on and reduce any potential risks of health, safety and environment. 2. KEY ACCOUNTING AND VALUATION PRINCIPLES The present annual accounts for Transitgas AG have been prepared in accordance with the regulations of Swiss financial reporting law and are presented in Swiss Francs (CHF). The main accounting and valuation principles used, which are not already specified by the Code of Obligations, are described as follows. Principles of financial reporting Financial reporting under the Code of Obligations requires certain estimates and assumptions to be made by management. These are made continuously and are based on past experience and other factors. The results subsequently achieved may deviate from these estimates. Main actual items in the annual accounts, which are based on the estimates and assumptions made by management, are as follows: A. Tangible fixed assets B. Technical equipment C. Intangible fixed assets D. Provisions Estimates and assumptions made by management The currency in which Transitgas AG operates is Swiss Francs (CHF). Transactions in foreign currencies are converted into the currency in which the Company operates (CHF) at the exchange rate on the day the transaction takes place. Foreign currency items
62 Annual Report - 2024 Monetary assets and liabilities in foreign currencies are converted into the currency in which the Company operates at the exchange rate on the balance sheet date. Any profits or losses resulting from the exchange are recorded in the profit and loss account. Non-monetary assets and liabilities at historical costs are converted at the foreign exchange rate at the time of the transaction. For long-term receivables and payables: any foreign exchange profits are deferred in the balance sheet as not having an effect on net income. Foreign exchange losses, on the other hand, are recorded in the profit and loss account. Related parties include members of the Board of Directors and Transitgas AG shareholders. Transactions with related parties take place under proper market conditions (dealing at an arm’s length). Related parties The cash item includes cash holdings, bank deposits and fixed deposits due within 90 days after the balance sheet date. Cash Trade receivables are recorded at their original net invoice amount. Value adjustments are carried out for receivables for which specific risks have been identified. Trade receivables Inventories are fully expensed in direct expenses (at acquisition cost). Inventories Technical equipment mainly refers to the gas pipeline with its related equipment and work in progress on technical equipment. They are recorded at acquisition cost, reduced by the cumulated straight-line depreciation, determined according to its expected useful life. Technical equipment
63 Annual Report - 2024 For technical equipment purchased before 2019, the expected useful life is defined in line with the duration of the lease agreement currently ending as of 30 September 2021, with the exception of the long term investments Reverse Flow and Obergesteln which are depreciated until 30 September 2033. For technical equipment purchased from 2019 on, the expected useful life is defined according to the technical life of the assets (10 to 40 years). If there is any evidence of an overstatement, the accounting values are reviewed and adjusted where necessary. Tangible assets mainly refer to installations, vehicles, office furniture and IT equipment. They are recorded at acquisition cost, reduced by the cumulated straight-line depreciation, determined according to their Useful lives are established as follows and are reviewed each year: Tangible fixed assets Installation and furniture Vehicles and IT equipments 1-3 years 1-3 years If there is any evidence of an overstatement, the accounting values are reviewed and adjusted where necessary. Intangible assets consist of software of the Company and CO2 certificates. Software is recorded at acquisition cost, reduced by the cumulated straight-line depreciation, determined according to their expected useful life. Under the CO2 act, Transitgas AG is required to participate in the Swiss emissions trading system (CH-EHS) and to monitor and report its yearly emissions.The CHEHS is set up under the ‘cap-and-trade’ principle. Each year a certain amount of emission allowances are allocated free of charge to the respective companies participating. These allowances are limited and determined in advance by an absolute emissions limit (cap). If an company is not able to fully offset its obligations with freely allocated emission allowances it needs to acquire these through the CH-EHS. Free emission allowances allocated by the Swiss Federal Office for the Environment (BAFU) are initially recorded at their nominal value (zero). Intangible fixed assets
64 Annual Report - 2024 Acquired emission allowances for the purpose of the own usage are initially recognised at their acquisition cost under intangible fixed assets. A provision is recognised when the CO2 emissions exceed the free emission allowances initially allocated. If there are already acquired emission allowances, the provision is built at the acquisition cost of the acquired emission allowances. If the CO2 emissions are also exceeding the acquired emission allowances, that part of the provision is built at the current fair value of emission allowances. Useful lives are established as follows and are reviewed each year: Software CO2 Emission rights 1-3 years according to effective utilisation If there is any evidence of an overstatement, the accounting values are reviewed and adjusted where necessary. Land mainly relates to uncultivated land. It is recorded at acquisition cost and not depreciated. Accounting values are checked and adjusted where necessary. Land Provisions are liabilities of uncertain timing or amount. They are recognised when Transitgas AG has a present obligation as a result of a past event, it is probable that an outflow of resources embodying economic benefits will be required to settle the obligation and a reliable estimate can be made of the amount of the obligation. Provisions Income from lease fees represents the income of Transitgas AG during the year. Revenue recognition Leasing and rental contracts are accounted for in accordance with legal ownership. Expenses as a lessee or tenant are recorded correspondingly as expenditure in the relevant period. Leasing transactions
65 Annual Report - 2024 3.INFORMATION RELATING TO ITEMS ON THE BALANCE SHEET AND PROFIT AND LOSS STATEMENT 3.0 Shareholders equity 31.12.2024 31.12.2023 Share capital 10’000’000 10’000’000 Capital Contribution Reserve 33’000’000 33’000’000 Statutory retained earnings 6’129’082 6’129’082 Voluntary retained earnings 2’241’000 2’190’000 Total shareholders’ equity 51’370’082 51’319’082 In the shareholders meeting dated 27 June 2018 based on the audit report according to Art 732 OR prepared by Deloitte AG dated 9 May 2018 following share capital reduction was decided: Reduction of the nominal value of 46’000 (class A) registered shares and 54’000 registered shares (class B) from 1’000 to 100 CHF. The reduction was repaid in part with 30 MCHF. The remaining part of 60 MCHF was allocated to the capital contribution 2019: payout out of capital contribution reserve to shareholders amounting to 11 MCHF 2020: payout out of capital contribution reserve to shareholders amounting to 8 MCHF 2021: payout out of capital contribution reserve to shareholders amounting to 4 MCHF 2022: payout out of capital contribution reserve to shareholders amounting to 4 MCHF
66 Annual Report - 2024 3.1 Cash 31.12.2024 31.12.2023 of which in CHF 22’751’277 28’777’426 of which in EUR 352’367 478’795 of which in USD 173’120 393’015 Total 23’276’764 29’649’236 3.2 Tangible fixed assets 31.12.2024 31.12.2023 Office equipment and construction office Zürich 1’336’296 1’336’296 IT equipment 2’419’699 2’149’881 Vehicles 196’671 196’671 Installations 1’097’964 1’097’964 less accumulated depreciation and value adjustments (4’561’594) (4’496’032) Total 489’037 284’780 3.3 Intangible fixed assets 31.12.2024 31.12.2023 Software 1’367’516 1’367’516 less accumulated depreciation and value adjustments (1’367’513) (1’367’513) CO2 Certificates 4’219’875 4’219’875 less consumption CO2 (371’204) (371’204) Total 3’848’674 3’848’674
67 Annual Report - 2024 3.4 Technical equipment 31.12.2024 31.12.2023 Gas pipeline and related equipment 1’693’580’507 1’687’342’629 less accumulated depreciation and value adjustments (1’668’212’473) (1’666’209’583) Gas pipeline and related equipment, net 25’368’034 21’133’046 Work in progress 4’765’272 3’013’997 Total 30’133’306 24’147’042 3.5 Deferred income and accrued expenses 31.12.2024 31.12.2023 due to third parties 3’428’228 2’642’120 due to shareholders 2’117’398 2’826’809 Total 5’545’626 5’468’929 3.6 Provisions 31.12.2024 31.12.2023 for holidays and overtime 217’000 194’000 for legal cases 350’000 195’000 for abandoned pipeline 5’464’192 5’813’645 Total 6’031’192 6’202’645 Provision for holidays and overtime includes social contributions owed by employer.
68 Annual Report - 2024 3.7 Extraordinary income/expense 31.12.2024 31.12.2023 Sales of premises Meiringen extraordinary income 840’684 - Related costs to sale of premises Meiringen (63’046) - Total 777’638 - 3.8 Lease liabilites (not terminable or expiring within 12 months of balance sheet date) 31.12.2024 31.12.2023 within one year 285’165 296’474 within two to five years 740’791 827’061 after five years 44’843 4’621 Total 1’070’798 1’128’156 Lease liabilities arise from car leasing and office rental. 3.9 Servitude liabilites (not terminable or expiring within 12 months of balance sheet date) 31.12.2024 31.12.2023 within one year 4’219 979’201 within two to five years 16’877 16’803 after five years 73’976 77’919 Total 95’072 1’073’924 Servitude liabilities arise from servitudes along pipeline for land which does not belong to Transitgas AG.
69 Annual Report - 2024 3.10 Fees for audit services 2024 2023 Audit services 45’000 45’000 Other services - - Total 45’000 45’000 PROPOSAL OF THE BOARD OF DIRECTORS ON THE ALLOCATION OF VOLUNTARY RETAINED EARNINGS PROPOSED APPROPRIATION OF AVAILABLE EARNINGS 2024 2023 CHF CHF Voluntary retained earnings at the beginning of the year - - Annual profit 2’241’000 2’190’000 Voluntary retained earnings available to the general meeting 2’241’000 2’190’000 2024 2023 CHF CHF Voluntary retained earnings available to the general meeting 2’241’000 2’190’000 Payment of dividend (2’241’000) (2’190’000) Balance to be carried forward - - allocation to statutory retained earnings in % of profit 0.00% 0.00%
70 Annual Report - 2024 TRANSITGAS AG Franklinstrasse 27 CH-8050 Zürich Tel : +(41) 44 318 75 75 E-Mail : info@transitgas.ch www.transitgas.ch
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