PRESS RELEASE

Finding a successful balance between meeting guests’ expectations and cost managementSuccessful 2014 financial year for the Grand Resort Bad Ragaz

Bad Ragaz, April 2015 – In 2014, the Grand Resort Bad Ragaz expanded its existing range of suites, which are particularly popular among international guests, to include a new Presidential Suite. The opening of the Clinic Bad Ragaz marked a further milestone in the medical expertise offered by the Grand Resort Bad Ragaz. Both the Tamina Therme and the Casino Bad Ragaz recorded increased turnover figures. On the whole, all of the Grand Resort Bad Ragaz’s business areas therefore contributed to the achievement of the targeted profit and turnover increase in the 2014 financial year.

Wolfgang Werlé (right),Chairman of the Board of Directors,and Peter P. Tschirky (left),Chief Executive Officer,in the new Presidential Suitein the Grand Resort Bad Ragaz.

Turnover growth in all three business areas (Resort, Tamina Therme and Casino) enabled Grand Resort Bad Ragaz AG to increase its 2014 consolidated turnover by a total of 1.6% to CHF 110.1 million (prior year: CHF 108.4 million). This resulted in consolidated earnings before interest, taxes, depreciation and amortisation (EBITDA) of CHF 24.5 million (prior year: CHF 22.3 million) and therefore 10% growth compared to the previous year. After the deduction of interest, taxes, depreciation and amortisation, the Grand Resort Bad Ragaz Group posted a net profit of CHF 6.3 million (prior year: CHF 3.6 million). At the same time, cash flow from business activities remained at a very solid level of CHF 29 million. Despite CHF 10.5 million in investments, the equity ratio rose to 40%.

Investments in the future

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The renovation of the first to third floors of the Spa Suites, which now form the new Clinic Bad Ragaz, was perhaps the most future-oriented but not the only investment project during the 2014 financial year: within the scope of the investments, in addition to the Clinic Bad Ragaz, the fifth floor of the Spa Suites was also converted into the Presidential Floor, and the world’s first La Prairie hotel boutique was constructed in the resorts 36.5° Wellbeing & Thermal Spa. The construction of the new thermal-water pipeline, which began in 2013, continued as planned. The pipeline went into operation as scheduled in spring 2015 to mark the 175th anniversary of the first pipeline and safeguards the resort’s long-term supply of thermal water, otherwise known as Bad Ragaz’s Blue Gold.

Grand HotelsAt 63.2%, the occupancy rate in 2014 remained on a par with that in the previous year. Despite the Ukraine crisis and the weak rouble, the resort only recorded a very slight decline in numbers of guests from Eastern Europe. The figures for overnight stays from the key primary markets of Switzerland and Germany remained constant. The number of overnight stays by guests from the rest of Europe also remained stable. Pleasing growth was seen in relation to guests from the Middle East, thanks to, among others, a combination of higher numbers of preventive medicine programme bookings and the high demand for large suites. The expanded range of suites made it possible to slightly increase the average room rate while still maintaining the average stay duration.

36.5° Wellbeing & Thermal SpaIn 2014, five years after the resort’s grand opening, the 36.5° Wellbeing & Thermal Spa further heightened its focus on guests’ needs with the new Thermal Water Collection: the guiding principle and basic philosophy is “sanus per aquam” (health through water). Therapeutic relaxation is the first programme in the Thermal Water Collection. From one day for a little downtime to several days of deep relaxation, the programme offers therapeutic relaxation that penetrates guests’ nervous systems. Since June, the Beauty & Care department has enabled guests to visit the world’s first La Prairie hotel boutique and not only enjoy a La Prairie spa adventure but also delve deeper into the product world of the luxury Swiss beauty brand.

The origin of the medical expertiseIn 2014, the SonntagsZeitung newspaper once again voted the Grand Resort Bad Ragaz “Switzerland’s Best Wellness Hotel”. The Handelszeitung newspaper also gave it first place in the category “Stylish health care – revitalisation and detoxification”. The reasoning: “The major plus here is the healing water in which several generations of people in need of recuperation bathed long before ‘wellbeing’ was coined as a concept.”

Spa and rehabilitation guests have been using the powers and healing effects of the thermal water since the 15th century. With the construction and expansion of

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the Medical Health Center Bad Ragaz under the management of Dr Wilhelm Martin Zinn in 1957, the water became offered to guests within the scope of outpatient therapies. The Grand Hotel’s initial focus on health ultimately manifested itself in the grand opening of the Grand Resort Bad Ragaz in June 2009 as Europe’s Leading Wellbeing & Medical Health Resort. This development would not have been possible without the passion and strategic far-sightedness of the Schmidheiny family as the original investors. Their commitment to the resort since the mid-1950s is deep-rooted in the unwritten family law of wanting to give something back to their home country.

Clinic Bad Ragaz openedOn 1 September 2014, the range of outpatient medical services offered by the Grand Resort Bad Ragaz was expanded to include a private inpatient clinic for musculoskeletal and internal-oncological rehabilitation in the form of the Clinic Bad Ragaz. “The Finest Art of Rehabilitation” thereby acts as a further milestone in not only the development of the on-site medical expertise, but also rehabilitation in Eastern Switzerland. Patients in both the new clinic and the Medical Health Center are treated by a highly specialised team of doctors, therapists and nursing staff.

Golf & SportsWith its wonderful natural surroundings and outstanding infrastructure, the Grand Resort is able to offer guests an excellent and varied range of sporting activities. Highlights are the 18-hole PGA Championship Course and the 9-hole Executive Course, which make the Grand Resort Bad Ragaz the only hotel in Switzerland to have two of its own golf courses. The number of rounds played rose by 19% in 2014. This was partly thanks to the good weather conditions, but above all to the 215 tournaments that were held and the fact that the number of members remained consistently high. The year under review was the most successful yet in terms of turnover. The Bad Ragaz PGA Seniors Open – the longest-running tournament of the European Senior Tour to be held at the same venue – will be held for the 19th time from 3 to 5 July 2015 under a new name: the Swiss Seniors Open. Two weeks before the biggest tournament in German-speaking Switzerland, the Golf Club Heidiland will be celebrating its anniversary on 20 and 21 June 2015. The beginners’ golf course, which has strong links to the region, has been one of the most important golfing venues in Rhine valley for many years and can look forward to continued success in the years to come.

Tamina ThermeOn its fifth anniversary, the Tamina Therme attracted attention in the year under review by not only receiving a world title for sauna infusion but also opening the Café Therme by Merz. This anchored the Therme even more firmly in the region as an all-round provider of wellbeing. The high quality of the spa oasis caused Switzerland Tourism to present it with the QIII quality seal during the year under review. This sign of excellent customer service and quality led to the admission

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figures for the Tamina Therme rising to 292,678 in 2014 (prior year: 274,032) and a turnover that broke the mark of CHF 10 million for the first time.

Casino Bad RagazCasino Bad Ragaz AG offers an attractive range of games and entertainment facilities compared to other Swiss casinos. Despite visitor numbers falling by around 9,500 to 130,742 guests, the turnover of CHF 21.8 million generated in the year under review was still slightly higher than that in the previous year (CHF 21.5 million). Thanks to careful cost management, the EBITDA rose to CHF 4.9 million (prior year: CHF 4.4 million). The fall in visitor numbers will be more actively combated in 2015 with targeted marketing activities and the further expansion of the entertainment facilities.

Corporate social responsibilityResponsibility towards guests and employees, the sustainable use of natural resources (in particular water and energy) and social and local commitment are all firmly anchored in the corporate strategy of the Grand Resort Bad Ragaz. Based on the environmental standard ISO 14000, the corporate social responsibility report now also provides environmental figures on energy and water consumption.

In addition to numerous continuing professional development options, a new range of courses on employees’ emotional intelligence was added to the resort’s training programme in 2014. The internal workshops help the staff to better identify and fulfil guests’ needs – in line with the motto of aiming to please. Guest surveys, such as the online survey conducted in 2014 within the scope of a master’s thesis by a student at the resort’s own Academy of Hotel Excellence, are used to further enhance service quality.

While the Grand Resort Bad Ragaz has 4,000 litres of thermal water available to it every minute, other people in the world are suffering from water shortages. In 2014, the resort therefore continued its commitment to projects that provide education and water to children in Africa in the form of For Smiling Children®.

OutlookOn 15 January 2015, the Swiss National Bank took the surprising action of discontinuing the minimum euro exchange rate. This resulted in an immediate appreciation of the Swiss franc compared to the euro and the US dollar, which, together with the continual depreciation of the Russian rouble since 2014, posed major challenges for tourist destinations, hotels and the Grand Resort Bad Ragaz. In view of the new price disadvantage, it is even more important for the resort to closely monitor consumer behaviour in its markets, to proactively respond to developments and to offer guests customised measures that are of relevance to them. Despite the immediate instigation of additional activities to encourage guest loyalty and acquire new guests, Grand Resort Bad Ragaz AG is expecting to record slightly lower turnover figures from the Grand Hotels and 36.5° Wellbeing

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& Thermal Spa business areas in the 2015 financial year than it did in the 2014 financial year. Employees’ flexibility and commitment as well as careful cost and purchasing management are therefore more important than ever.

However, despite its challenges, 2015 is also offering opportunities: the continuation of the diversified market development that commenced in 2009 and a clear focus of the services on medicine and wellbeing are proving expedient decisions in terms of direction. In line with its roots, the resort will operate with passion and respect and in a sustainable manner to ensure its long-term success, enable progress and innovation and further develop its position as Europe’s Leading Wellbeing & Medical Health Resort. The new website launched in 2014 will form the heart of all communications.

In the anniversary year “Bad Ragaz celebrates 175 years of thermal water”, the resort is not only committed to its source of health and wellbeing but also to Bad RagARTz, which will attract visitors to Bad Ragaz from 9 May.

Nightly rates at the Grand Resort Bad Ragaz start from CHF 490.– for a double room. Rates include a generous buffet breakfast, welcome aperitif, use of the 36.5° Wellbeing & Thermal Spa and Tamina Therme, fresh fruit and Ragaz water each day and daily fitness and relaxation activities. VAT included. Rooms can be booked at www.resortragaz.ch.

The Grand Resort Bad Ragaz (image 1) is nestled in the heart of the Heidiland holiday region and has used its thermal water (image 2) to aid the health and wellbeing of its guests for 175 years. The Grand Resort Bad Ragaz expanded its range of suites in 2014 (image 3). With the Clinic Bad Ragaz, the resort now offers “The Finest Art of Rehabilitation” (image 4).

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175 years: a blue-golden jubileeOn 31 May 1840, the four-kilometre-long water pipe was put into operation to channel the thermal water from Altes Bad Pfäfers to the Hof Ragaz. The healing, body-temperature water has been flowing directly to Bad Ragaz ever since, making the resort a unique source of personal wellbeing and health. It is thanks to this “Blue Gold” that Bad Ragaz enjoys a worldwide reputation as a spa resort. In 2015, the village celebrates this jubilee.

About the Grand Resort Bad RagazNestling amid mountain scenery, the Grand Resort Bad Ragaz is situated in the Heidiland holiday region of Eastern Switzerland, just an hour’s drive from Zurich. It is regarded as Europe’s Leading Wellbeing & Medical Health Resort and was awarded the accolade of “Winner Best Medi Spa” in 2013 by the Spa Guide published by the prestigious travel magazine Condé Nast Traveller (UK). The resort, which dates back to 1242 when a body-temperature thermal source was discovered and has been honoured as “Switzerland’s Best Wellness Hotel” (SonntagsZeitung, 2014), offers an extraordinary and authentic spa experience in the 36.5° Wellbeing & Thermal Spa. With a total of 58 GaultMillau points and 1 Michelin star, the eight restaurants provide first-rate culinary delights. In addition to 267 rooms and suites, the resort also offers two golf courses, the Kursaal Business & Events Center, a broad range of cultural activities, the public Tamina Therme thermal spa and its own casino. Complementing the wellbeing and recreational facilities is the internationally renowned Medical Health Center, a byword for diagnostics, preventive care and rehabilitation of the highest order, as well as the Swiss Olympic Medical Center. In 2014, the outpatient medical facilities were expanded to include an inpatient rehabilitation clinic.

Media contact:Martin LeiterDirector of PR & Corporate CommunicationsGrand Resort Bad Ragaz, CH-7310 Bad RagazTel.: +41 81 303 27 16, Further information:

Downloads:Images and Word document of the press release: Images of the Grand Resort Bad Ragaz: (username: presse, password: resort7310)All images © Grand Resort Bad Ragaz AG.

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