And I would like to welcome anybody who didn't find the seats yet. By the time we're ready to serve dinner, everybody will have the seats, and there is more than enough food for everybody. I would like to give a special welcome to the members of group management and all employees of Sika present today. With me on the podium are Paul Schuler, our CEO Avren Wittmer, our CFO and also Stefan Moesli, General Counsel and Secretary of the Board of Directors. Also present here today are approximately 20 Sika employees who are manning the various stations.
And I would like to give thanks to all these helpers today and thank them very much for the work they're doing. Ladies and gentlemen, first, we will now come to the constitution of today's general meeting. By publication in the Swiss Official Gazette of Commerce on 15th March 2019 and also by written notification sent out on 15th March 2019 also. The invitation for this AGM took place in accordance with the provisions of the law and of the articles of association in due form and time. The invitation contained the agenda items and also the various motions of the Board of the audited statements and the compensations report were available for perusal at the main seat of the company for shareholders.
And in the invitation, shareholders were also it was also pointed out to shareholders that any shareholder can ask for these documents to be sent to them by Sika. Also, as of 22nd February 2019, the annual financial statement was available on our website and could be downloaded and printed if so required. And following our invitation, in the Swiss Official Gazette of Commerce on 22nd February 2019, there were no requests for additional agenda items submitted. The minutes of last year's AGM and also the special general meeting of 11th June 2018 were signed by both the Chairman and also the minute taker. And they were also available for perusal to shareholders at the company seat and were published online.
Chairmanship of the AGM is the Chairman is given to the Chairman of the Board of Directors in accordance with our articles of association. Our mail's keeper will be once again Mr. Stefan Mursley. In that connection, I would like to point out that this AGM is being recorded on video and broadcast live on the Internet as a web stream. The minutes of the AGM as well as the presentations will be available online, too.
And if you so wish, they can be sent to you. We now come to the appointment of the vote tellers whose names you see on screen now. The tellers will only be used in the case in case of a malfunction of the electronic voting equipment or we have to do an open vote or a vote in writing. In that case, we would make use of the voting envelopes that you received. Head teller today is Mrs.
Caroline Inouen. And I would like to thank the ladies and gentlemen, tellers for assuming this task. The auditors, Ernst and Young AG, are represented by Mr. Christoph Mikkel and Marc Ruygseke, who I would also like to welcome here today. The independent voting proxy is Mr.
Joost Windlin. He's an attorney and notary in Zug, whom I also welcome here quarterly. And he will vote in accordance with the instructions given to him by shareholders. I thank Mr. Windlin for assuming this mandate and would ask him to quickly stand up.
Thank you. Shareholders have the possibility to take part in today's Annual General Meeting by means of electronically or electronical powers of attorney and instructions given to the independent voting proxy. Participation by these means had to be submitted no later than Friday, 5th April, 2019, at 11:59 p. M, as well as any possible changes to those. Then I would also like to thank Mr.
Dominik Slapnik and his team for organizing today's event. The number of shareholders present and votes represented will be keeping a tally of that, and I will keep you up to date on attendance before voting begins on agenda item 1. So I hereby take note that today's Annual General Meeting was convened in accordance with the law and our articles of association, that this general meeting is orderly constituted and is prorate for all agenda items. Are there any objections to what I just announced? No?
Thank you. So at today's meeting, we will proceed in accordance with the agenda you see here. After my presentation on the strategy, Thomas Hasler will be speaking on the subject global business, global thinking, global acting. Then we will proceed to the statutory part of today's meeting. Under Agenda Item 1, our CEO, Paul Schuler, will also give a report on the past business year as well as an outlook to 2019 and the acquisition of Parex.
At today's Annual General Meeting, you again have the possibility to voice your opinion or ask questions. If you wish to do so, we would ask you to go to the speaker's desk and register there and to let us know on what agenda item you would like to to what agenda item you'd like to say something. And you would then be called at the appropriate time to come to the speaker's lecture and give your contribution. Dear shareholders, ladies and gentlemen, 2018 was a historic year for SECO, during which the course was set for further growth and sustainable success. Last May, the 3.5 year takeover dispute between the Burkhart family, Saint Gobain and Sika, could be ended with a solution that was fair to all parties.
And with the introduction of the single class of shares and the 1 share, 1 vote principle, we were also able to take a significant step in the enhancement of our corporate governance. At this point, I would like to once again express my warmest thanks to all shareholders who have supported us over the last few years. 2018 was also proof that we can still pack a punch and grow strongly and as well as being another very good year for business. With sales reaching a record CHF 7,100,000,000 and operating profit of CHF 946,000,000 and a net profit of CHF687,000,000, we can look back on the past financial year with pride. The results of the last few years have demonstrated that we are on the right track with our Strategy 2020 and are implementing it successfully.
We have managed to increase both sales and EBIT on an annual basis ever since 2012. So not only the operating results, but also our investment in future growth has been impressive. The slide behind me gives you an overview of our strategic initiatives of recent years. Since 2015, we have registered more than 300 new patents, opened 37 new factories, established 11 new national subsidiaries and effected 20 acquisitions involving sales volumes of almost CHF800 1,000,000. The largest acquisition in our history, however, was announced in January this year.
In this year, we will complete the takeover of Parex, a leading company in the area of mortar for internal construction and facades. Parex is active in 23 countries with a very strong presence, especially in Asia. Thanks to an additional annual sales volume of more than €1,200,000,000 This acquisition will make us the leading supplier worldwide in the mortar area and further strengthen our technology portfolio. Our market has a volume of CHF 60,000,000,000 in the construction area in 2020 and remains highly fragmented on the supplier side. In other words, there will be further opportunities to support our growth with acquisitions going forward.
A number of our competitors are also facing major changes, and that should have the effect of accelerating the consolidation process in the coming years. Our aim is to play an active role in this consolidation process and expand our leading market position further. However, at the same time, we will be taking care to ensure a good balance between organic and acquired growth. With this in mind, we will be elaborating our strategy for the period until 2023 this year. Board of Directors and Group Management initiated this process back in September of last year already and have now involved further levels of management.
In October, the new strategy 2023 will be presented to investors, analysts and the wider public. At this point, I would like to provide you with some examples of the megatrends on which our strategic growth assumptions are based. Take urbanization, for example. The global population is growing continuously, and an increasing number of people are being attracted to urban centers, which is giving rise to so called mega metropolises. This phenomenon in turn calls for greater construction density, improved infrastructure and new structural engineering solutions.
And then there's sustainability. Natural resources are becoming ever scarcer and mankind's awareness of the importance of the environment is changing. The demand for environmentally friendly, low emission and safe products is therefore rising steadily. Another example, mobility. More and more people are becoming increasingly mobile, and new concepts are required for both individual and public transportation.
Alternative drive systems and the reduction of emissions are becoming increasingly important, while lightweight construction requirements are rising steadily. These megatrends are driving the growth of our markets. And we have been successfully navigating these markets for decades, producing responses to the new challenges that arise. Allow me to explore in a little more detail the megatrend of urbanization. Urban centers act like magnets.
No fewer than 7 out of 10 people will be living in an urban environment. Consequence of this, major cities are going vertical. This is the only way to create space for the growing number of people being drawn into urban living. In 2010, there were 50 so called super tall skyscrapers worldwide. It is expected that by 2,030, there will be no fewer than 600 buildings of this kind, a 12 fold multiplication in the space of just 20 years.
You can see it here on the slide. It's very impressive. Such super tall skyscrapers have significant requirements regarding construction materials and thus regarding our products. Given the stringent standards that these buildings have to meet in terms of strength, concrete becomes a key construction material. Moreover, tall buildings require extensive foundations, encompassing multiple below ground stories.
These must be reliably sealed against water penetration. The skyscrapers' glass facades must be able to withstand strong winds and major fluctuations in temperature. For all these challenges, Sika has the right technologies from additives for high performance concrete and self leveling mortars to waterproofing solutions and glass facade sealants. You can see by the example of urbanization that Sika has the right answers to modern megatrends and therefore is well equipped to face the future. However, Sika is much more than just a broad range of innovative products.
We cultivate an entrepreneurial management culture in which decisions are taken promptly at the lowest possible level and in proximity to the market in question. The more than 100 heads of our national subsidiaries have full entrepreneurial responsibility for day to day business, the financial results and strategy implementation. This allows us to respond to changes in the market rapidly and with agility. The customer is always our focus, and we are renowned for our comprehensive solution based approach and technically adept experts. Partnerships with our customers begin at the planning phase already when specifications for the various elements are drawn up and continues throughout the project's duration and onto the construction site.
This holistic approach that Sika employs proves to be a key competitive advantage on complex major projects in particular. In addition, this holistic approach involves fulfilling our responsibilities towards society and the environment. Since 2,009, we have signed up with the UN Global Compact and respect its ten principles on human rights and ethical business practice. Furthermore, when it comes to our code of conduct, we do not tolerate any gray areas. Under the slogan, more value, less impact, we also commit to meeting certain objectives in the areas of sustainability on an annual basis.
And we report our progress in this respect in keeping with the globally recognized GRI 4 standard. For example, last year, the Sika Group reduced its energy consumption by 5.8%. It is our aim with our corporate strategy to do the right thing by all stakeholder groups. Up until now, we have managed that with good success, and we talk of the Sika success story with pride. And you as Sika shareholders have benefited from this too.
Sika has been able to increase its dividend year after year. And for today's general meeting, the Board of Directors is once again proposing to the shareholders an increase of the gross dividend, namely from CHF1.85 to CHF2.05 per registered share. Dear shareholders, as you can see, Sika is determined to continue its success story to generate lasting added value and to improve its already excellent reputation with customers, shareholders and business partners alike. At this point, on behalf of myself and the other members of the Board of Directors, I would like to offer you, our esteemed shareholders, our heartfelt thanks for the solid backing you have given us over the last few years. A special debt of gratitude is owed to Paul Schuler and the members of group management who have led Sika to yet another record result as well as to our workforce of some 20,600 employees for their great dedication and commitment.
We are looking forward to tackling the business challenges that await us this year and would like to assure you that we will do so with dedication, enthusiasm and tenacity with a view to ensuring that 2019 is another successful year for all of us. Mr. Thomas Hasle will now present to you another example of our successful strategy implementation, namely our Global Business segment. Thank you very much. And we'll give the floor to Thomas.
Thank you very much for giving me the opportunity to present Global Business to you. It's best to get started with customers and the segments that we cover in Global Business. The core piece of our global business activity is the automotive industry, which we were starting in 30 years ago and have built up consistently in the past 30 years by offering system solutions, application of adhesives. We introduced acoustic systems, then added structural adhesives. We expanded to structural Reinforcements.
And we're also supplying to all the suppliers of the automotive industry with door modules, roof modules and so on. This is a field of dynamic growth where we're using our skills in bonding, attenuating, stiffening. Technological leadership has brought leadership in terms of market share over time and has brought us a lot of competitive advantages. But it's not only automotive that we have in Global Business. We also have similar related industries with few global market participants that have very decentralized production.
For the household appliances industry, well, we're talking about maybe 5 to 10 globally operating players that control the market. And for wind, the wind industry, it's about 10 suppliers that dominate the market. In the marine industry, we also have a highly concentrated business. There are very few skilled enough to produce cruise liners. There's only 5 of them operating globally.
Or in commercial shipyard vessel production, we only have 5 manufacturers around the world dominating the market. In addition to that, for the subcontracting and supplier industries, we've got electrical appliances that are increasingly important, and I'll be coming back to this in a minute. This is the global reach, local present, global thinking, local action. That's very important in this business. Our customers, both centrally and decentralized, central and decentralized, they need strong partners making available technologies in the countries where they have manufacturing operations.
Those products, automotive, wind and marine, require a lot of development, and products and systems used in those areas have to be available everywhere. To this end, you need to have partners that are committed to being present not only in Europe, North America or China, but appear around the world. Sika has made that commitment and has built up strong presence in more than 20 countries with 2,100 employees. The results speak for themselves. We've had double digit growth in the past 4 years because customers need our system solutions.
You can see all the industrial countries around the world here are covered, and we keep expanding our capacities in these markets. So this goes to show why we have got organized a little different in this segment. We've got to speak with one voice. We have to agree on our strategies and bring them in line. It's about long term partnerships.
We're being challenged by our customers, but we also have to make sure that we get rewarded for our activities with activities in Brazil, China or India and so on to be able to achieve scaling effects. Fundamentally, we are mirroring our customers' organization. When customers are centrally organized, as some automotive manufacturers are, then we will be the same. And if their business is decentralized, we will be just as decentralized in serving that particular customer. At the end of the day, it's about expert knowledge, expertise that we can apply, be it in terms of research and development or technical skills and implementation and production, and we have to ensure that quality is always appropriate.
Let me touch upon 3 megatrends in the automotive industry. Most of them are well known. For one, it is about lightweight construction. The lighter vehicles are, the less energy is consumed. For a number of years, this has been one of the main drivers for car manufacturers, reducing weight.
The acoustics, the comfort is an important selling point. Vehicles today have to be good performance and have to give us users the feeling that we can move on in isolation and in peace and quiet. And acoustics plays a very important role as far as end user satisfaction is concerned. In recent years, you will have heard about it, We've had the advent of e vehicles, people moving away from combustion engines to electric engines and new market players such as Tesla entering the arena, these are major challenges for our clients, and we offer solutions to them to better champion those challenges. I'd like to briefly touch upon these three aspects.
Structural adhesives, as I as we've said, have been in use for a number of years. The aim is to reduce weight, to make car bodies lighter, to take out weight by coming away from welding and using a bonding instead. So it's easier to make bodies, car bodies and to use weight only where it is absolutely required. And Sicapower technology has been crucial in achieving success in this regard. This chart is demonstrating this.
This is a premium vehicle car body of a premium vehicle composed of steel, aluminum and carbon fiber reinforced plastics. It speaks for itself. Steel on steel can perhaps be welded but ought to be bonded. But when it comes to joining Aluvia with Steel, then bonding is the only technology that can be implemented commercially and rationally. And CFRP on steel, that adds a new factor to it.
We're talking about adhesives exposed to different therm coefficients of expansion of aluminum and steel and carbon fiber reinforced plastics. Sika has solutions provided solutions with the Ambix technology, which is patent protected and in use in the premium segment as demonstrated in this chart. But these premium segments, A8 the A8 model versus S Class, Mercedes and so on and so forth, is also expanding to volume segments. That means ongoing growth for Sika Technology. This demonstrates very nicely our annual growth rates in excess of 20% on the back of this technology and moving out of the previous segments into the volume segments.
In 2014, for instance, we produced exclusively in Europe. In the meantime, we've been taking our production in the United States, Brazil and China to satisfy the demand. Moving on to Acoustics. I mentioned it's a matter of comfort. For us as end users, We need to have insulated acoustically insulated interior space.
Desounding of the car body work is what we want to achieve. So it's about the fundamental structure of the vehicles where we're making sure that airborne noise is dampened noise is dampened or structurally borne noise through vibration of the car body cannot be perceived inside the car. We made an acquisition in Germany of a global leader last year in acoustic deadening. And this chart shows you the perfect match of the 2 technologies that we've had from the Seeker and PHYs. This has turned us into an acoustics powerhouse for car body acoustics.
This is a statement OEMs made congratulating us on this acquisition. We've got airborne noise and structural borne noise and structural reinforcements from a single source now. E mobility comes into play. Future vehicles will be without combustion engines. They need more acoustics because the lack of the combustion engine, which is usually perceived positively, will develop new noises, high frequency noises carried by wind or roll, and this will bring new potential.
Autonomous driving is perhaps the best example. It's a great trend. And this is about us not driving ourselves anymore but being chauffeured by the car, which will mean that there'll be requirements on the carport either. We'll say, well, we want to work in peace and quiet inside the car. We want to live in the car.
We want to have a totally insulated space because the car is driving itself. And it will be thrilling to see how we will do in a traffic jam because we'll be working productively, sitting in the traffic jam and probably not caring about it anymore. Electric vehicles, you can read it everywhere, are focused on the battery. That's the core piece of an electric vehicle. Now here, it's a matter of producing more efficient batteries.
Batteries are measured against the absorption of capacity and generation of capacity, which is to do with energy exchange that generates heat. Modern batteries have to have efficient air conditioning, as it were. This requires material that adds or extracts energy between the various components. We have firmly conducted materials that we can develop further so as to increase battery efficiency. E engines, which have been available for almost 100 years, are subject to radical change.
E engines in mobile use have to become lighter and more high performing. We have a lot of activities with OEMs going on to drive ahead this development. And again, what we need is smart materials to bring about these improvements. We've been talking about grouting materials, epoxy and polyurethane substances that we make available. And in summary, what we're seeing is an electric trend that we're looking very much forward to.
We like seeing a lot more electric vehicles in the markets because this involves 20% plus of potential in terms of lightweight construction, acoustics and specific components such as battery charging units that will have to be used in addition in those vehicles. Now let me move on with some prospects and tell you where we stand. We have a long term growth strategy that we defined starting in 20 20 2015 and lasting until 2022, the average sale per vehicle is to be increased from 5 to more than 10 over this period of time, and we are on course, on track. We surpassed our objectives last year. And this year, again, we'll be able to exceed the figures stated here.
Over on the right hand side, you can see some examples of what this means in the vehicles. These are some premium vehicles, the Tesla, AS, Jaguar, AF PACE and others, where we're making CHF 70 or CHF 100 or more CHF of sales per car or also Golf 7, for instance, the volume vehicle is also covered here. And in conclusion, let me touch upon this. There is great talk about the automotive industry. Market conditions are volatile.
There is a trade war between the blocks, between the United States of America and China or the United States and Europe or Europe and China, which causes uncertainty in the markets. We've got a highly networked global industry that responds sensitively to those disruptions or vagaries. In Europe, we are struggling with Brexit, and we've had diesel gate, which caused uncertainty among consumers. They don't know what types of vehicles to buy, won't buy diesel, won't buy petrol. And this means that we have negative basic sentiment in the automotive market.
You can see it in this chart at the bottom right. Current production units are decreasing. In the past 6 months, we've had strongly decreasing numbers in China, in Germany, in the UK. And below the line, we had a 6% downturn in the Q1 of this year, and we're expecting further decrease in the Q2 and then expect some degree of recovery and leveling off at a lower level than 2018. Now we cannot change anything about these figures, only we can increase our market penetration, which is what we're doing, as I have shown with the chart before.
And despite the negative volume growth, we are achieving organic growth of 2% in the Q1, and we'll do the same in the quarters to come. We will gain market share irrespective of unit numbers. But this is something that you can read about every day. And of course, it's relevant to our industry. The megatrends are helping us achieving our goals.
We've got the right products. We're well equipped for the future, and we want to be a reliable partner to our OEMs and make long term commitments. Thank you very much, indeed. Thank you, Thomas. Ladies and gentlemen, as you can see, not only in construction but also in the industry, we have a great potential for the future and we are very pleased with that.
Before I now move on with the official parts of the Annual General Meeting today, allow me, ladies and gentlemen, to make a few remarks on the voting procedure. As you will have seen, we are going to use a new electronic voting system this time around. It will be operated by Dovigus Engineering. Let me briefly explain to you the use of the new voting device. The voting device has 3 buttons.
The top button is to vote yes. The center button is to abstain from voting. And the bottom button is for no. The colors are green, amber and red, respectively. As soon as I have explained the motion in the proceedings today and everyone has spoken about it, I will officially open the vote.
From this point in time on, your voting devices will automatically go into voting mode, and all 3 buttons will light up, which demonstrates that the voice that the device is on standby. If this should not be the case, please turn to check-in with your device and have it replaced. To cast your vote, you will have 10 seconds time each time around. The 10 seconds will count down on the screen behind me. During this time, you will have an opportunity to press green for yes, red for no or amber for abstaining.
Should you press the wrong button, you can simply press the button of your choice within the voting time to cast your vote. But as soon as the 10 seconds of voting time have elapsed, it will no longer be possible to correct your vote. The results will then be shown on screen just a few seconds later. If you notice during the voting period that your device is out of order or that you're having problems with it, please turn to the check-in desk. If you wish to leave the hall during the proceedings, we would like to ask you to take with you your voting ballot papers and voting device.
Shareholders who have voted against a motion can have this taken down in the minutes if they wish to do so. In order to do so, please return your voting device following the Annual General Meeting at the speakers' desks and specify your name. Furthermore, every shareholder may demand that their statements are taken down in the minutes. The in the minutes of the Annual General Meeting. Let us now test whether the electronic devices work.
I have a trial question for you. Were you aware that in the 2018 financial year, Sika, for the first time ever, generated sales in excess of CHF 7,000,000,000. And I expect honest answers, please. Once I've opened the test, you will have 10 seconds' time to cast your vote saying yes, no or abstention by pressing the corresponding button. Please take your voting device and cast your vote now.
Time is up. The vote is closed. Bear with me until the voting results will be available just a few moments from now. And here are the results. The share of YesVoz is 99.82%.
So 99.82 percent, if you knew, that Sika, for the first time, exceeded the €7,000,000,000 sales threshold in the past financial year. Well, great, you've prepared so well. Should you have noticed during the vote that your voting device is out of order or should you be unclear about how to handle it, please turn to the check-in desk. As I mentioned before, at the Annual General Meeting today, you will have an opportunity to make comments or ask questions. If you wish to take the floor, we would like to ask you to first sign up at the speakers' desks and let us know which item you wish to speak about.
You will then be called as the item comes up and you can use the rostrum upfront to make your statement. In order to keep the proceedings efficient, we would like to ask you to go and sign up at the speakers' desks if you wish to do so. Please speak to the item that you have specified and try to be as brief as possible and to avoid repetition. We now have the attendance figures available on the chart. Projected behind me, you can see the number of shareholders present and the total of votes represented.
Taking into account those votes represented. We have 6 60 shareholders present here today, and the total of votes represented is 104,860,004. The shares held by Sika and its subsidiaries are not entitled to vote. Thus, they're not represented here. These figures will be again established before every vote to take into account anyone joining late or leaving early.
Based on our articles of association, the Annual General Meeting passes resolutions or conducts elections with the absolute majority of votes cast, excluding abstentions and invalid or empty votes unless the law or the articles of association provide otherwise. So let us move on to dealing with the items on the agenda today. You can see the agenda projected on the screen behind me, and you will have also seen it found in the invitation. So I will forego reading out the various items to you. Let us begin with item number 1.
Item number 1, approval of the annual financial statement and consolidated financial statements for 2018. So at the media conference of 22nd February 2019, we already extensively reported on the business year of financial year 2018. For further details on the annual financial statements and consolidated financial statements, I would refer you to the details in the Annual Report 2018 of Sika AG. However, before we proceed to the approval of the Annual Financial Statements and Consolidated Statements 2018, Our CEO, Paul Schuhler, will also explain to you the business development in 2018 and give you an outlook for the current year. And with that, I would like to give the floor to Pawel.
Dear shareholders, 2018 was really a great year for us. And as we all know, we were able to get above the €7,000,000,000 sales mark, And we were also able to set a new record of €945,900,000 EBIT and €687,100,000 net profit. And we have our 20,000 plus employees to thank who all contributed to this. We also made some important investments. We founded 11 new factories and a new national subsidiary and made 4 acquisitions.
It was also nice that we saw growth in all regions. In the Americas, it was over 11%. Then in Asia, 5.5%. EMEA, 14.1%, excellent. That's really an amazing achievement.
And in Asia, with 5.5%. And as was already explained, the global business and also the there was 29.2% growth also caused by the acquisition of Faist. So we as I already mentioned, we are now we now were able to break the threshold of €7,000,000,000 in sales. And it's very important for us to be close to our customers. So we have sales companies everywhere, but it's even more important if we are able to have production worldwide.
So in many countries, besides sales companies, we also have production sites, example, in Vietnam, Saudi Arabia. If you look at these exotic countries, you can see the dynamic of these emerging markets. And it's a joy to see how on a worldwide scale in 101 countries and subsidiaries, we are able to be very dominant, gain big market share, be close to our customers and build up something sustainable. So the number 101 is our subsidiary in Honduras, a small country, a small market, but we are expecting great growth there as well, and we see excellent opportunities to strengthen our position. Also, by having our own people there and at some points, a factory of our own.
Also very challenging and very pleasing to see is how operations are integrated, for example, Feist that was mentioned by Thomas, fantastic company, €200,000,000 global business, market leader in technologies for automotive industries, but also for other industries, very successfully integrated. After 1 year, the company is fully integrated into our automotive business unit. And their employees now feel like part of the Sika family. They're working closely together with our people. So, excellent integration work there.
Also exciting, Index. That is a business for foils in Italy. And we have a position of €100,000,000 there. And we gained an additional company with €110,000,000 So that has further strengthened our position in Italy. And we can offer more efficiency but also be closer to our customers and sell more.
So that's an excellent start in Italy. Then we bought a small company specialized in foams, PolyPag, and we intend to roll this out world wide. And then finally, fiber mesh fibers for the cement industry, especially for the cement mortar industry, where it has to get stronger, the material, and is therefore reinforced with fibers. So therefore, we are looking at all these new acquisitions very optimistically, and we're sure that we have some great years ahead with them. So the outlook, what does the future hold in store?
The first 3 months saw growth of 7.1% in a difficult market, and Thomas explained that briefly before. So that was very, very, very good. So we achieved 1.6
€1,000,000,000
and there's growth in all regions. We've also already we've already announced some acquisitions, Parex and King in Canada and Bellini Eco in Belarus and also a new mortar plant in Senegal, as I explained before, close to the customers, close to the market and excellent raw materials available. In the Americas, we see 4.8% growth momentum sales and 8.2% in Europe and 2.8% in Asia. That shows robust growth. And we are very optimistic in that respect that we can keep up the pace.
Automotive with 13.3 is still profiting from the Faist acquisition, but there's been a little bit of a slowdown there. But I already explained that previously. But I'm, however, optimistic that we will once again be able to keep that level of results. So 7.1% overall. Looking at the quarters.
So the Q1, 2017, 2018 2019, we see a clear increase in the last 3 years. And you could also extend that to the past 6 years. So compared to the previous year, we always have better results in each quarter. So that's what our goal is. Very exciting acquisition, this one.
We hope that we can conclude it in the weeks ahead. Parex is a pearl that we have found on the market. On the one hand, a competitor who is manufacturing mortar. But what is exciting, they are selling 80% of their or realizing 80% of the sales through sales, through trade. So Parex is €1,200,000,000 in volume, has €195,000,000 in EBIT and is very well distributed in the different regions.
It has 74 plants across 23 countries, 13 research and development centers, and we will have an additional 4,600 employees after the acquisition. What is exciting about Parex? Well, they are specialized. Let's give you an example. For China, our business we have business of 247 €1,000,000 and they have business for €350,000,000 So we are mainly in direct sales, and Parex has a fantastic network of dealers and traders.
So they have hundreds of traders selling their products. They have 190,000 points of sales in China, and they are growing with 10%, 50% annually in that trade business. So if you have our great products, imagine them being brought to their thousands of traders and portfolios, you don't need to think far ahead to imagine that we are getting a real powerhouse on board here and a distribution network that will be great to watch and fantastic opportunities in that area. So about €600,000,000 expected in China and a very strong market position. U.
S, quite different market. We are already at €1,100,000,000 there. Parex is only at about €130,000,000 But we are very active in all areas except facades. And Parex is very strong in facade business. So imagine, we are on the inside, they're on the outside of the building.
So it's a perfect combination, another additional business. So we'll be good for €1,200,000,000 in the U. S. Market and have a very strong position there. As you know, at Sika, we only have 5 technologies only in brackets.
We know where our strengths are. We have the adhesive systems that are important for the automotive and construction industry. Then we have the coating systems for roofing, but also for water supply. Then we have concrete systems, admixtures our coating systems, sorry, there's a flooring and thermoplastics was the other and then mortars. And Parex is exclusively in the mortar business, doing very well, having excellent margins.
And by adding them, we can strengthen our basis and reach €8,300,000,000 in sales annually. It's not just a wild, crazy acquisition, but we are strengthening something, an area of specialization we're already in and want to realize more sales. In the past years, you have seen how many mortar factories we opened, how we got stronger. And this is the fastest growing market at the moment with the highest margins. And as you see, we can almost double with Parex.
So the doors are wide open for an even stronger position, very exciting, very lucrative business opportunity. So 1 +1 equals 3. That is our motto here. So on the growth platform, we can sell our Sika products via distribution channels of Parex, as already mentioned, in China, for example. Then we can also directly sell Parex facade systems via Sika in all countries, roll that out everywhere where Parex is not yet present.
They are in 23 countries at the moment. And then we will have more than 2,000 additional salespeople in the market who will bring us even closer to our customers, be even more proactive in sales and therefore, generate more energy. Improvement of margin. Of course, we're thinking of synergies in purchasing. We can compare prices and improve them.
Then we have optimized capacities for our factories. And we can improve the delivery systems and the supply chain. So only advantages there really in improving our margins. And then again, joint market development will, of course, be possible in 23 Paris countries. Well, you might say this is a big acquisition.
It's difficult, but we are acquiring we're kind of acquiring 23 companies and 23 subsidiaries. They're already there. We have talked to the managers, and we will bring all this together to see how can we realize that growth. It's not just one big company that we're taking over. As such, we are taking over 23 subsidiaries in different countries.
And EMEA will gain €4,000,000 to the €3,200,000,000 already and €300,000,000 will be gained in the Americas and Asia Pacific, €500,000,000 So very good distribution, very solid and most importantly, very motivated employees. So we are optimistic that as soon as we have closed that deal, we can set course in the right direction. So the outlook for 2019. We are still assuming a sales growth of 6% to 8% in local currencies. As soon as we conclude the Parex deal, we believe that we'll be able to exceed the sales targets of CHF 8,000,000,000.
And next year, hopefully, we'll be able to ask you, did you know that we have exceeded 7,000,000,000 8,000,000,000. And you can answer yes, and hopefully, that will be the right reply. So we're opening 7 to 9 new factories to improve our footprint where ARIX is not yet active. And then the strategy 2023 that we're working on intensively right now, everybody on the Board and group management, will be communicated at the Capital Markets Day in October. So all in all, we are very optimistic, 6% to 8% growth in 2019.
Thank you very much. Thank you very much, and of course, congratulations on this excellent start into 2019. And on behalf of the Board of Directors, I would like to thank group management and all employees for their fantastic commitment. I think we all agree that once again, the whole Sika team has shown an amazing performance in the past financial year, and that's worth a big applause, in my opinion. Thank you.
So the financial and consolidated financial statements were audited by auditors Ernst and Young AG. And you can find the corresponding reports on Pages 141 to 143 and 162 to 162 in the annual report. And Ernst and Young recommends to approve the annual financial statements and consolidated financial statements. I would like to thank the auditors for their work. This now brings me to the actual agenda item or the proposal.
Based on the auditors' reports, the Board of Directors proposes unanimously that the Board the annual financial statements and consolidated financial statements for 2018 be approved. And I have here a request to speak from Mr. Schmid from Earendingen. Mr. Schmid?
Dear Chairman, ladies and gentlemen, after I received no reply for my letter, I would like to read it out here briefly. When the French siege army was in front of the were in front of the Ford's CICA and the family boycott wanted to take away all the gold, then it was immediately sold because we don't want anything to do with the French, right? We know The sale turned out to be a mistake in the end. I could not imagine that Sika would be able to free themselves from this predicament with a huge effort in terms of time and money, and I would still be interested what the whole thing actually costs in the end, this now happened. So a buyback of shares was the immediate consequence.
But I had to conclude that Zika had voluntarily tied a millstone around their neck again. You know exactly what brought Swissair down. It was the participations in Belgium and Switzerland. I don't understand how Zika can put itself in such jeopardy again. In case of a slowdown of the economy, which we don't hope, then in France, you won't find you won't be able to let a single employee go, and you will have to turn to your Swiss employees with that.
And that, of course, is not all right at all. I refer to the example of Alstom. So I would recommend to sell that company as rapidly as possible again and to retreat into our safe Switzerland, so we can guard our treasure trove. Thank you very much. Thank you, Mr.
Schmidt, for your contribution. Maybe you made out from the presentation from Mr. Schuler that Parex has its headquarters in Paris, but only 20% of its activities are in France. Well, I understand some of your concerns regarding France, but here the pros outweigh the cons. And we have seen that there are great synergy potentials available here and that we are making the right decision.
I hope that answers your question and the points you raised. We have another speaker here, Mr. Grop, Walter Grop. I don't know where he comes from. I'll be happy to tell you my name is Walter Korb from Bern.
So first of all, ladies and gentlemen, it is much more fun to come to an AGM with fully covered tables instead of just a chair with a paper bag on it. And I think that's really impressive. I think you are really much better hosts than in the previous years. Thank you for that. So now to my remarks.
So EUR687,000,000 in earnings. And where and how did you pay taxes for this? That's what I would like to know. And also, I would like to know how many accidents happened last year on the workflow and where. And I also agree with the previous speaker.
I would be interested what this whole takeover circus cost because that was a huge waste of time. But of course, certain results remained and certain consequences and costs. And we, as small shareholders, are very interested what the whole thing costs. Thank you, Mr. Grop.
Those were several questions in one. So let's I propose that we'll work out replies, and we will formulate our replies at the next meeting. Thank you. Does anybody else wish to speak? Apparently not.
So with that, we will now proceed to the vote. I now would kindly ask you to take out your voting device. If you want to follow the proposal of the Board of Directors, press green. If you vote against, red. And the amber button is for abstention.
So voting on And voting time is up. And here we have the results. You have approved the annual financial statements and consolidated financial statements for the year 2018, and they are therefore approved. So we now come to agenda item 2.
The Annual General Meeting has a total of CHF1 296 1,000,000,000 available. And we propose a dividend payment of CHF 290,600,000 with CHF 1,005,000,000 to be carried forward to new accounts. The dividend proposal with its notes being screened behind me, and you can also find it in the invitation to the Annual General Meeting today and on Page 158 in the 2018 annual report. The statutory auditors have confirmed that the proposed appropriation of retained earnings is in line with the articles of association and the law. I shall therefore not read out the proposal to you.
If you approve the board's proposal, the gross a gross dividend of CHF2, CHF5, will be paid per share. Anyone requesting the floor on this item on the agenda? No one has signed up, and no one is asking for the floor from the audience. So let's proceed to the vote. Take your voting device.
And if you wish to approve the Board's proposal, press green. If you wish to reject it, press the red button. And for abstention, press the amber button. Voting time is on now. And here are the results.
You have approved the board's proposal. Thank you very much. Moving on to item number 3, granting discharge to the administrative bodies. The board proposes unanimously that the members of the administrative bodies be discharged. We are going to vote collectively on discharge to be granted to the administrative bodies before we proceed to the vote.
Let me point out that in agreement with Article 695 of the Code of Obligations, anyone who's been involved persons who are representing votes of persons who've been involved in the management of business. Anyone requesting the floor on this item? This is not the case, so let's proceed to the vote. Please take your voting device. If you wish to go along with the board's proposal, press the green button for yes.
If you wish to reject it, press red. And the yellow button is for abstention. Voting time is on now. As announced in the media release on the 22nd February 2019, Mr. Ulrich Suter no longer stands for reelection as a member of the Board of Directors.
Ulrich Suter has been a member of the Board of Directors of Sika Limited since 2003. Dear Uli, I would like to take this opportunity to thank you on behalf of the group management and the Board of Directors for your major services to Zika. All of us have greatly appreciated cooperating with you. Your contributions have always been to the point and have always been based on common sense. You have never been distracted by details, but always been in a position
to
be in the picture and to be in control of the situation. This was very important, especially in recent very difficult years. With your scientific background, you have always been a strong pillar supporting Seeker's power of innovation. You've been personally committed to various research projects and have been a partner to talk to and a coach for our chemical engineers. As a gift, as a farewell gift, we have therefore chosen a product from our labs.
It is based on most recent digital technology and was made using special mortar from Seeker and a 3 d printer. Based on our research, our gift should be a perfect fit for your garden. Dear Uli, we have chosen to give you 2 such planting containers and with the plants in them, and they will be delivered to you in the course of this week on a date of your choice. So it will be up to you to find the right place for them in your garden. Thank you very much again for your great commitment for the benefit of Seeker.
I wish you all the best. Well, following all this praise, I should not miss the opportunity to put it into perspective. I was just very fortunate in 2003 to join the best company I know, perhaps even the best company ever, and to be elected as a member of the Board of Directors. In this company, it was possible for me to work with great colleagues on the Board and with a tremendously efficient and effective group management and with more than 20,000 persons going to work and driving ahead things every day. It's been fantastic.
Well, there's a small dent in everything being fantastic 5 years ago when some evil elements of legal and other nature entered the scene and attempting to attack the jewel in the gem in the Swiss industrial scene in a very indecent way. Now with the help of the Board of Directors, the Board of Directors left today, we managed to avoid the evil. And I think we can only be management and the CICA staff, CICA workers, all of them together with little prospects for success in the beginning, managed to save this company and to make it flourish again. To all those, I would like to thank very much. Well, thank you, Uli.
I wish you all the best for your future. This brings us on to item 4, point 1 reelection of the Board of Directors. As provided in our articles of association, we elect all members of the Board of Directors individually and for a period of a term of office of 1 year until conclusion of the next ordinary Annual General Meeting. The new electronic voting system allows us to carry out the individual elections of all candidates, 1 after the other, and to present the outcome following the final election. In other words, I will conduct elections of every candidate, but the results will only be announced to you collectively after the final election.
This will help us to save some time. As mentioned, with the exception of Ulrich Suiter, all current members of the Board of Directors stand for reelection, and the Board of Directors supports reelection of them unanimously. Anyone requesting the floor to speak on this item? No one is signed up to speak. No one is asking for the floor.
So let's proceed to the election of the individual members. The Board of Directors proposes, in line with items 4.1 to 4.1.6, to unanimously reelect myself as a member of the Board of Directors and to reelect Fritz Van Dyck, Monica Ribaugh, Daniel Sauter, Christophe Tobler and Justin Howell as members of the Board of Directors. Please take your voting devices. If you wish to approve the board's proposals, press the green button. If you wish to reject the board's proposals, press the red button.
And if you wish to abstain from voting, press the amber button. As I said, we will go through the various candidates and have a vote on their election, and the results will then be presented to you upon the final election. Let's begin with election of myself. This is Item 4.1.1. The vote is on now.
Cast your vote, please. Time is up. As I said, the results will be presented at the end of all the elections on Vrits van Dijk. Voting time on 4.1.2 is on now. Please cast your vote.
Moving on to the vote on reelection of Monica Ribaugh as a member of the Board of Directors. Voting time on 4.1.3 is now on. Please cast your vote now. Time is up. Moving on to the vote and reelection of Ms.
Danielle Sauter. Voting time on item 4.1.4 is on now. Time is up. The vote is closed. Moving on to the vote on reelection of Mr.
Christophe Tobler. Voting time on item 4.1.5 is on now. Please cast
your vote.
The vote is closed. And finally, moving on to the vote on reelection of Justin Howell. Voting on 4.1.6 is on now. Please cast your vote. The vote is closed.
Bear with me until the results have been established. Here you see all the election results on Item 4.1. You have elected all the candidates proposed by the Board of Directors at major majorities. I congratulate my colleagues on reelection and would like to thank you for your trust and confidence. Thank you very much.
And with that, we now come to agenda item 4.2. New elections to the Board of Directors. As already announced in the media release of 22nd February 2019, the Board of Director proposes the election of Thierry van Langer and Victor Bailly to the Board of Directors for a term of 1 year. Thierry van Langer has been CEO and Chair of the Board of Management at AkzoNobel since 2017, a global company specializing in paint manufacturing and specialty chemicals. He is a Belgian citizen and holds a degree in chemical engineering from the University of Ghent in Belgium.
Victor Vale is a member of the Board of Directors or the Supervisory Board of several listed and private companies such as, for example, University of St. Gallen as well as a master in chemical engineering from the Swiss Federal Institute of Technology in Zurich. Further informations on these candidates can be found in the invitation to today's meeting. Victor Baoli, unfortunately, cannot be present here today. He had a skiing accident and is now in hospital.
Well, luckily, he's on the way to recovery, and we all wish him a speedy recovery from here. Terry Van Langer, however, is here, And I would ask him to stand up for a moment. Thank you, Thierry. So Thierry Van Lanka and Victor Barley would be excellent additions to our Board of Directors with their great experience and competence in their respective areas. As stated in our articles of association, we elect board members individually and for a term of 1 year, which is until the conclusion of the following AGM.
So the 2 elections will be held subsequently to each other, and the overall results will be presented following the 2nd election. Does anybody wish to speak on this item at this point? Mr. Graub. Only briefly, I would ask the candidate to come forward to the speakers' lectern and quickly introduce himself.
That would be very interesting for all of
us.
Thierry, please. Okay. It's a bit unexpected. I will try to do this in Germany even though I'll sound like that famous Dutch TV host maybe, but it's a great honor to be proposed for Board membership at Sika, I think it's a great company. And I've always had a close connection with Switzerland.
I lived in Switzerland for 8 years and worked here. Well, it was clear already from meetings with Mr. Van Dijk and Mr. Helk that this company well, it's interesting for me coming from my background in paints and varnishes. So I also think that myself and Paul Schuler can certainly have very interesting exchanges about what worked in my company or what maybe worked better at SEEK and what we can both learn from the other in this case.
I am Flemish by birth. I'm a chemical engineer. One of my weaknesses in youth is that I study philosophy as well, but okay. I've been married for 30 years. I have 2 daughters who are much cleverer than myself and my wife by now, but I think that happens to everybody.
Thank you very much. So thank you, Thierry. Any further contributions? No. So with that, we will now come to the new elections.
The Board of Directors proposes in accordance with the agenda items 4.2.1 or 4.2.2 unanimously that the following persons be elected to the Board of Directors for the term of Oster von Neer, Terri Van Langer and Victor Volley. So please take out your voting devices now. And if you agree with the proposal of the Board of Directors, press the green button. If you disagree, the red. And if you wish, ChapStain, the amber yellow button in the middle.
And as already announced, they will be voted individually, and both results will be presented together following the 2nd round of voting. So we begin with the election of Thierry Van Lanka. And the votes for agenda item 4.2.1 is now open. Please vote now. The vote is now closed.
And we come to the election of Victor Bali, agenda item 4.2.2. The vote is now open. Please vote now. And time is up. We will now await the results.
You can see the results on the screen. And as you can see, you have elected both Thierry Van Lanken and Victor Balli into the Board of Directors with a great majority. Congratulations, Thierry and Victor, and I'm already looking forward to working with you on the Board. Next, agenda item 4.3, election of the Chairman. The Board of Directors unanimously proposes my reelection as Chairman of the Board for a term of office of 1 year.
Does anybody wish to speak on that agenda item? I do not see anybody. So we will now hold the vote on my proposed reelection. Please take out your voting device now. If you agree with the proposal of the board, press green.
If not, red. And if you wish to abstain. Amber, voting starts now. And time is up. So you have reelected me as President as Chairman of the Board of Directors.
Thank you for your trust. This brings us to agenda item 4.4, reelection of the Nomination and Compensation Committee. Board of Directors proposed unanimously that the following persons be elected to the Nomination Conversations Committee. The members of these committees will be elected individually and for a term of office of 1 year, that means until the conclusion of the following AGM. Here again, in this case, I will carry out these votes individually, and the results will then be all presented together at the end of the final votes.
All members of the nominations and compensation committees are making themselves available for reelection and are supported unanimously by the board. Does anybody wish to speak? No. With that, we will now proceed to the individual votes. The Board of Directors proposes in accordance with Article 4.4.1 to 4.4.3, the reelection of Fritz Van Dyck, Daniel Sauter and Justin Hauhl to the Nomination Conversation Committee.
Please take out your voting device now. If you wish to agree with the proposal in question, press green button. If not, press the red button. And if you wish to abstain, the amber button in the middle. We start with the reelection of Fritz van Dijk.
Agenda item 4.4.1, voting starts now. And time is up. Next, the re election post reelection of Daniel Souter. And voting on this agenda item 4.2 starts now. And time is up.
And finally, we will proceed with the vote on the reelection of Justin Howell. Agenda item 4.4.3 is now open. Please vote now. You have reelected Fritz Van Dijk, Daniel Sauter and Justin Howell into the nominations and compensation committee with a great majority. Congratulations, Fritz, Daniel and Justin, and thank you, dear shareholders, for your confidence.
And that brings us to Agenda Item 4.5, election of statutory auditors. The Board of Directors unanimously proposes that Ernst and Young AG be elected as statutory auditors for the 2019 financial year. Mr. Christoph Michel has informed us that Ernst and Young AG will be happy to assume that mandate provided that the AGM votes in favor. Does anybody wish to speak on this point?
No. That means we can directly proceed to the vote. Please take out your voting device. If you wish to agree to the proposal by the Board of Directors, press green. If not, red and otherwise, if you wish to abstain, the amber button.
Voting on agenda item 4.5 starts now. You have elected Ernst and Young AG as auditors for the 2019 financial year. Congratulations. Agenda item 4.6, election of the independent proxy. As provided by our articles association, the General Assembly also votes for the independent proxy.
And the Board of Directors unanimously proposes that Joost Wind, Linnerten, and Dorn Notor in Zug be elected independent proxy until the close of the next Annual General Meeting. Does anybody wish to contribute something on this agenda item well, then we will proceed to vote. Please take out your voting device. If you wish to agree, press yes, green if not, no, red and if you wish to abstain, the amber abstention button. The vote on agenda item 4.6 starts
now.
So you have reelected Joost Windlin as our audit as our independent proxy, and I congratulate Joost on his reelection.
We received the answers to Mr. Grop's questions, and Mr. Wittmer will present them. Mr. Grop, I can answer your questions as follows.
On the tax expense, payments in the year under review, well, we paid about €220,000,000 We paid €220,000,000 of tax in all countries we operate. So that's the global aggregate. Question number 2, costs related to the takeover battle. Over the period of 3.5 years, we ran up about €30,000,000 of cost in the years 2015, 'sixteen and 'seventeen, and this cost includes all external expenditure related to the takeover battle. And regarding your third question, number of accidents in 2018, it was a total of 208 accidents at work that we recorded.
You will find details on Page 11 of the annual report for more information about the accidents. Questions are answered sufficiently. Mr. Gropp? Thank you very much.
This brings us on to item 5, compensation. Beginning with item 5.1, a consultative vote on the 2018 compensation report. The 2018 compensation reports includes the basic principles for compensation of the Board of Directors and the group management as well as the remuneration of the members of these 2 corporate bodies for the 2018 financial year. The compensation report is part of the annual report on Pages 68 to 88. For 2018, the total compensation for the Board of Directors amounts to CHF 2,600,000 compared to CHF 2,800,000 in the prior year.
The decrease of compensation compared to the prior year is based on the fact that 3 members of the Board of Directors stepped down at the extraordinary general meeting on June 11, 2018, while only one new member was elected. At the time, total compensation for the group management in 2018 amounted to CHF 16,500,000 compared to CHF 18,700,000 in the prior year. Lower compensation for the group management is primarily due to the new composition of the group management, which in the 2018 financial year was composed of 9 members, whereas in the 2017 financial year, it was up to 11 members. And it was also attributable to a slightly lower payout based on our annual bonus plan. The shareholders that the ordinary general meeting in 2017 approved maximum compensation of CHF 19,000,000 for the group management and for the 2018 financial year.
This limit was complied with very generously. Now allow me to make a remark at this point. As you will have noted perhaps, one proxy adviser suggested to reject the 2018 compensation report. They do not argue about the amount of compensation but refer to a technical matter. The proxy advisor complains that under the new long term bonus plan, a payout will be made even if performance is achieved below the median of a peer group.
But we can assure you that the compensation system we have chosen continues to reward for true and sustainable performance. And let me also refer you to the compensation report and the explanations on our website. This brings me to the board's proposal on the consultative vote. The Board of Directors proposes unanimously that the 2018 compensation report be approved by a nonbinding consultative vote. Anyone requesting the floor on this item?
This not being the case, we proceed to the vote. Please take your voting devices. If you wish to go along with Paul's proposal, press the green button for yes. If not, press red for rejection or the amber button to abstain. Voting time is on now.
Time is up. The vote is closed. You have approved the compensation report for 2018. Thank you very much. Moving on to item 5.2, approval of future compensation of the Board of Directors.
The Board of Directors proposes a maximum amount of CHF 3,300,000 to be paid for 8 members of the Board of Directors. You can see explanations shown on the screen behind me. The aggregate amount is likely to be composed as shown on screen, €1,700,000 for fixed compensation, CHF 1,350,000 for share based compensation and CHF 250,000 for social security contributions. The proposed maximum amount is around 10% higher compared to previous years. This increase is attributable on the one hand to the increase in the number of members of the Board of Directors from 7 to 8 and on the other hand to the adjustment of the compensation system for the Board of Directors.
The compensation system for the Board of Directors has not been adjusted since 2012, although in this period of time, both sales and profit of SEEKA continuously grew and capitalization more than tripled. For this reason, a benchmark analysis was carried out based on which the structure and scope the compensation was adjusted to current market practice. This brings me to the board's proposal. The Board of Directors proposes unanimously that a maximum total amount of CHF3,300,000,000 in compensation for the Board of Directors consisting of 8 members be approved for a term of office of 1 year until the close of the next Annual General Meeting. Anyone requesting the floor on this item?
This not being the case, we proceed to the vote. Please take your voting devices. If you wish to go along with the board's proposal, press the green button. If not, press red. Or if you wish to abstain from voting, press the amber button.
Voting time is now on. Please cast your vote. You have approved future compensation for the Board of Directors. Thank you very much. Moving on to item 5.3, approval for future compensation of the group management.
Allow me to make a few remarks at this point. On the chart, the screen behind me, you can see apart from the proposed compensation for 2020, also the development of compensation for group management in the past 2 years. The aggregate amount proposed for the 20 20 financial year is likely to include CHF 8,700,000 for fixed salaries, including Social Security bonus payments and CHF5.4 million for allocation of grants or entitlements to Seeker shares under the long term incentive plan for the period of 2020 to 2022. The proposed aggregate amount for the 2020 financial year of CHF 19,500,000 was calculated on the basis of the current maximum compensation of the 8 members of the group management. It also includes a so called buffer, a reserve for potential adjustments.
Fixed base salaries include the base salaries for the members of the group management. The budgeted performance bonus, as I mentioned before, is based on maximum payout. The actual payout will be made in the year 2021 and will depend on the extent to which the group management is going to achieve its goals in 2020. Effective payout may be lower than the budgeted amount. The long term incentive plan includes the value of allocations of entitlements to shares in the 2020 financial year.
These entitlements will be paid out only after the end of the performance period, that is to say in 2023, this on the basis of effective goal achievement, of actual goal achievement. Again, we calculate on the basis of maximum pay out, which will only occur if all the goals are achieved. And add to this, the pension contribution and fringe benefits. The increase of the proposed maximum amount as opposed to the previous year is attributable to adjustment of the long term incentive plan that now includes a maximum payout factor of 150% with regard to allocation of performance share units. This list represents a reasonable development of compensation for the group management, especially in light of the excellent figures SEEK have produced.
This track record is primarily attributable to the group management headed by Karl Schuler. The proposal is the Board of Directors proposes unanimously that a maximum total amount of CHF 19,500,000 in compensation for the group management consisting of 8 members be approved for the 2020 financial year? Anyone requesting the full on this item? This not being the case, let's proceed to the vote. Oh, yes, there's someone.
Yes, please. Please state your name and place of residence. Memdrove from Romans Hohmen. And I wanted to ask you about the salaries for the workers in this period of time. We are only talking about the Board of Directors and the group management.
Well, I mean, I don't know the full the aggregate amount of salaries, but we increased the salaries based on the indices and market conditions. You don't have any percentage to announce? No, we don't have any percentage to announce. Any other comments or questions at this point? This not being the case, may I ask you to take your voting devices?
If you wish to approve the board's proposal, press the green button. If you wish to reject it, press red. And to abstain from voting, press the amber button. Voting time on Item 5.3 is on now. You have approved future compensation for the group management, which I would like to thank you very much for.
This brings us to the end of the formal part of the Annual General Meeting of Sika today. Again, we've had an Annual General Meeting with overwhelming support from you esteemed shareholders. I would like to thank you very much also for your loyalty to Sika and your trust in the Board of Directors and the group management. We will do everything in our power to justify your trust again in future. The next Annual General Meeting, the 52nd one, will take place on April 21 in 2020.
And I'm pleased to welcome you again, as many of you as today next year. I will make sure there'll be enough tables available for you. I would like to ask you to either return your headsets and televoting devices to the assistants passing your tables or leave them on your seats later on. Following the meeting, we're going to serve dinner to you at your tables. And I cordially invite you to stay on and to celebrate yet another record year of seekers.
You will later have an opportunity to take a bus shuttle to the Bahrain station. I would like to thank you for having come here in such a high number and wish you a safe trip home later. I herewith declare the ordinary Annual General Meeting in 2019 close. Thank you very much.