Directors and Officers

Investment Advisor

Hottinger Capital Corp.

1270 Avenue of the Americas, Suite 400

New York, NY 10020

(212) 332-7930

Administrator

Citi Fund Services Ohio, Inc.

Custodian

Citibank, N.A.

Transfer Agent

American Stock Transfer & Trust Company

59 Maiden Lane

Plaza Level

New York, NY 10038

Legal Counsel

Stroock & Stroock & Lavan LLP

Independent Registered Public Accounting Firm

Deloitte & Touche LLP

The Investment Advisor

The Swiss Helvetia Fund, Inc. (the “Fund”) is managed by Hottinger Capital Corp., which belongs to Groupe Banque Hottinger & Cie SA.

Groupe Banque Hottinger & Cie SA dates back to Banque Hottinguer, which was formed in Paris in 1786 and is one of Europe’s oldest private banking firms. Groupe Banque Hottinger & Cie SA has remained under the control of the Hottinger family through seven generations. Its headquarters are in Zurich with offices in Geneva, Sion, Basel, Brig and New York.

Executive Offices

The Swiss Helvetia Fund, Inc.

1270 Avenue of the Americas, Suite 400

New York, NY 10020

1-888-SWISS-00 (1-888-794-7700)

(212) 332-2760

For inquiries and reports:

1-888-SWISS-00 (1-888-794-7700)

Fax: (212) 332-7931

email: swz@swz.com

Website Address

www.swz.com

The Fund

The Fund is a non-diversified, closed-end investment company whose objective is to seek long-term capital appreciation through investment in equity and equity-linked securities of Swiss companies. The Fund also may acquire and hold equity and equity-linked securities of non-Swiss companies in limited instances.

The Fund is listed on the New York Stock Exchange under the symbol “SWZ”.

Net Asset Value is calculated daily by 6:15 P.M. (Eastern Time). The most recent calculation is available by calling 1-888-SWISS-00 or by accessing our Website. Net Asset Value is also published weekly in Barron’s, the Monday edition of The Wall Street Journal and the Sunday edition of The New York Times.

Overall Investment Strategy and Process

The goal of the Fund is to provide shareholders with broad exposure to the Swiss equity market and to returns based on long term capital appreciation through investments in Swiss companies that have the potential to provide sustainable returns. Management looks to achieve these goals by investing in companies whose growth profile is underestimated by the market or whose recovery potential is overlooked by other investors. These investment opportunities exist across various market capitalizations. The Fund invests in Swiss companies ranging from some of the largest global businesses to mid- and smaller-size companies that are less represented in the major Swiss indices, including private equity investments in early stage companies.

The investment approach of the Fund’s management is bottom-up driven by fundamental research on specific industries and companies’ products, services and business models. As part of the portfolio construction process, Fund management considers the market capitalization and risk return characteristics of portfolio companies to determine the range of weightings for each position. As a result, the screening and weighting process of the Fund’s holdings reflects the broader Swiss market.

In the recovery strategy, company-specific factors are the primary driver for stock selection. Positive industry trends can be a supporting factor that helps reduce

company-specific risk, thereby enabling possible larger asset allocations to these positions.

Similarly, in the undervalued growth strategy, an expected expansion in a specific company‘s market share is a primary driver for stock selection. However, if a company is active in an overall growing market, the risk-return profile of the investment is improved, and Fund management may consider a greater asset allocation to the company.

Management believes that its stock selection process, which is based on fundamental analysis of specific companies’ business developments, will add value to the Fund’s portfolio. This is a long term investment approach, especially when investing in mid- and smaller-size companies where it usually takes more time for a company’s success to attract the attention of investors.

Investment Results

Portfolio Composition

(All percentages are as of the year-ended December 31, 2013)

Strategies, sector and industry group exposure

During the last quarter of the year under review, there were no significant changes in the exposure of the Fund’s portfolio to the different strategies or market capitalizations, with the exception of some profit taking in the recovery strategy for purposes of funding part of the payment of the Fund’s annual distribution to stockholders. These transactions included trimming the Fund’s positions in Weatherford, Panalpina, DKSH, Credit Suisse and the elimination of the Fund’s position in Biotie.

The large pharmaceutical companies, Roche and Novartis, remain on the path of high single digit earnings growth. These companies should be able to offset upcoming patent expirations with recently approved products or product line extensions along with promising drug candidates. In Management’s view, their valuations, which are in line with the broader Swiss or U.S market, does not give them full credit for their consistency and low expected volatility. Together with the food and beverage and luxury goods companies (e.g., Swatch and Richemont), the large capitalization pharmaceutical industry is the primary component of the Fund’s undervalued growth strategy, which is the largest strategy exposure with 44.6% of the Fund’s assets.

The second largest strategy exposure in the Fund has been to recovery mid- and small-capitalization companies, which comprise 21.2% of the portfolio. These holdings reach across multiple sectors like healthcare, industrials and financials, and include some of the best performers of the year (e.g., Nobel Biocare, Meyer Burger and Panalpina).

Some of the Fund’s longer-term holdings, including Lindt, Belimo and Burckhardt Compression, are part of the Fund’s undervalued growth mid- and small-capitalization strategy, which comprises 16.7% of the Fund’s assets. The companies in this strategy have a relatively clear path to sustainable growth because of their ability to gain market share and their presence in growing end markets.

Finally, the smallest category in terms of percentage of Fund assets is the recovery large capitalization strategy with 11.0%. International banking institutions like UBS and Credit Suisse, as well as global industrial companies like ABB fit into this strategy. Due to their market positioning and the stage of development of their respective industries, these companies are focusing on improving profitability in order to increase their added market value. Their business strategy is to spend resources and management attention on increasing returns on capital. This approach is justified by the high level of competition in their respective industries, an environment that tends to push economic returns towards zero.

Throughout the different strategies and on average during the year, the Fund’s portfolio was comprised of fewer than thirty stocks outside of the Fund’s investments in illiquid securities, including the two limited partnership investments. Management believes this portfolio composition reflects its investment approach to owning high conviction stocks based on a strong bottom-up investment process.

Macro factors exposure

Investment in the mid- and small-capitalization segment of the market entails higher exposure to trading liquidity risk. This factor tends to push the valuations of these stocks to a discount as investors become more risk adverse, such as during periods of rising concern over strong global deflationary forces. The recovery strategy also carries certain risk, as these companies are more vulnerable than the rest of the portfolio to the volatility of global economic growth. On the other side, Fund management believes stocks fitting into the recovery strategy should benefit over-proportionally from an increase in long term interest rates and a steepening of the yield curve brought on by economic expansion.

In terms of geographic exposure, the United States, as the biggest consumer of drugs and medical services, remains critical for the Swiss healthcare sector. The country spends USD 6,500 per person, which is the highest of all the member countries of the Organisation for Economic Co-operation and

Development (almost three times as much as Japan and twice as much as Germany). The United States spends 18% of its gross domestic product (GDP) on healthcare, compared to 11% in other high income countries. The good news for the Swiss pharmaceutical companies is that drug costs are only about 10% of that total spending while hospital care is about 30%. The Swiss players in this space are active mostly in high unmet medical needs, which are somewhat isolated against price deflation or consumer push back. Nonetheless, the evolution and implementation of the Affordable Healthcare Act and the sustainability of Medicare spending will have to be monitored closely.

Performance Analysis

(Returns are total returns in Swiss francs for the year ended December 31, 2013 for the days the sector or the stock was held in the portfolio, if not otherwise specified)

The Fund’s net asset value total return in USD was 28.2%. The Fund’s performance compares well with the broad Swiss market as reflected by a total return in USD of 26.4% by the iShares MSCI Switzerland. The Fund’s total return, however, was hampered by the allocation to private equity, as this sector underperformed the rest of the portfolio as a result of negative adjustments to the valuation of certain direct holdings, despite certain positive developments in the two limited partnership investments.

After a strong showing during the first nine months of the year, the mid- and small-

capitalization companies in the growth recovery areas of the market, not surprisingly, went through a profit taking phase in November, but regained most of the lost ground towards the end of December.

Looking at the individual total returns, the Fund’s portfolio included most of the Swiss market outperformers for the year. The top seven total return performers in the Fund’s portfolio were found in the recovery mid- and small-capitalization strategy. Some of the work that management (in most instances, new management) of these companies has implemented over the past two years is bearing fruit. A more stable economy in 2013 also helped accelerate these companies’ recoveries. For example, Actelion produced a 76.31% return, contributing 1.9% to the performance of the Fund. Panalpina returned 58.1% for the year, contributing 1.39% to the Fund’s performance.

The greatest contributors to the Fund’s performance were in the pharmaceutical industry, which makes up the largest part of the Fund’s undervalued growth strategy. Roche led this field by adding 5.6% to the Fund’s performance, which is attributed in part to the large position weighting but also to an impressive 40.1% total return. Novartis had a more modest return of 28.5%, but its contribution of 2.7% to the Fund’s performance was the second best in the portfolio due to the large size of the position (an average weight of 9.8% for the year).

The difference in performance for the year between these two blue chips is explained by the quality of Roche’s fundamentals. The ability of Roche to develop “first in class” and “best in class” drugs has positioned the company as the leader in certain main disease areas, such as oncology, ophthalmology, infectious disease and neurosciences. The success rate in developing new classes of drugs with potential blockbuster opportunities has been increasingly important over the past years for the industry. Roche has been very innovative and has been able to protect its franchise and rejuvenate its product pipeline in several therapeutic indications. Roche’s recent announcement to increase its manufacturing capacity also is a positive sign of management’s optimistic view.

On the weaker side, returns on Holcim and Syngenta in the material sector underperformed compared to the Fund’s overall portfolio return, with the sector only contributing 0.4% for the year. Holcim lagged its peers during the year mostly because of its less favorable geographical exposure. The company did not fully benefit from the U.S. recovery and was penalized by its significant activities in India, a market still plagued by overcapacity. Syngenta, after posting a strong return in 2012, underperformed its peers in the seed business and was negatively affected in crop protection sales by lower crop prices during 2013.

The financial sector provided a relatively strong contribution to the performance of the

Fund. Swiss Life was the main contributor due to its strong return for the year (+57.3%) despite a lower average portfolio weighting than other members of the sector, including UBS and Credit Suisse.

In the large capitalization segment of the market, several holdings that fit into the recovery strategy underperformed during the year, including ABB, UBS and Credit Suisse. After a strong second quarter, the large Swiss banks were negatively affected by higher legal costs of their legacy businesses and a reduction in gross margins in wealth management. In addition, net new money flows and the overall cost-to-income ratio were negatively impacted by lower client activity. The higher than expected cyclicality of the wealth management business led investors, including Fund management, to view the long term potential of this business in a more critical way. Management will monitor closely the evolution of the gross margins of the wealth management segments of the Swiss banks to assess the change in business mix away from off-shore private banking, a premium priced business in decline due to the weakening of Swiss banking secrecy.

The ABB investment case is a good example of ways to identify triggers for inclusion in the Fund’s recovery strategy, but also of how timing can be quite a challenge. ABB gave confidence to investors when the company’s new CEO and CFO came on board recently and laid out a comprehensive business strategy, focused on synergies between divisions and elaborated clearly on

ways to increase return on invested capital. In addition, throughout the year, the trend in margins was improving and pricing pressure was clearly alleviating, explaining the strong performance of the stock (+29.3% for the year). However, the company recently disclosed that it had to take additional charges for the problem child in its portfolio: the power system division. The reasons were legacy issues and excess capacity created by even lower business activity than recently expected. In the ABB investment case, the recovery is now being clearly delayed. The sheer complexity of ABB’s mix of businesses is a hurdle to a larger portfolio allocation to the stock, but the footprint of the company and the quality of the automation business partially offset this negative aspect.

Fund management focuses on identifying a set of company- and industry-specific factors that can drive stock returns. The results of the examination of periodic earnings releases are used to update the development of factors and their impact on where a company fits in the Fund’s overall strategy. After the establishment of strong stock performance, the business developments of a company are monitored to assess the durability of those returns. Specifically for the recovery strategy, an analysis is done to determine if a company can transition from the recovery stage to a more stable profitable growth phase. If this transition is not taking place, Fund management will examine a potential sale of the position.

Private Equity

Zurmont Madison Private Limited Partnership, one of the Fund’s two investments in private equity funds and its largest overall allocation to private equity, developed positively during the period. The buy-out investments in industrial and business services companies held by Zurmont continue to show progress and first exits are planned to be realized in 2014, depending on the level of deal activity and market conditions. Aravis Biotech II Limited Partnership, the Fund’s other private equity fund investment, also developed positively during the period.

With regard to the Fund’s private equity holdings, in some cases valuations have been impacted negatively as a consequence of the need to raise additional capital and company-specific events that have affected operations. The performance of these illiquid investments will also depend on overall market conditions and investors’ appetite for riskier assets.

Macro-Economic Insights

2013 started off with the appearance of strengthening support from central banks, as the U.S. Federal Reserve had just inaugurated its third round of quantitative

easing. A reinforcement of the ongoing dependency between the level of monetary interventions and global equity markets occurred. Moreover, none of the concerns related to the U.S. fiscal cliff or the political situations in Germany or Italy materialized, while China’s economic growth surprised on the upside later in the year within the context of the worldwide inflation rate staying under control.

The economic recovery of the Eurozone accelerated at the end of 2013. The Eurozone PMI (Purchasing Managers’ Index) continued to point to an expansionary environment, with a 53.2 composite reading in January driven by manufacturing activity as production advanced to its fastest pace since May 2011. Furthermore, new orders rose for a sixth successive month. Growth picked up in Germany and the rate of decline eased in France, while the rest of the region also saw a strengthening upturn. The economic downturn in the periphery countries of the Eurozone also seems to be coming to an end. Consumer confidence continued to improve, signaling a favorable environment for private consumption, which was reflected in the latest retail sales data and consistent with more spending in durable goods. Mario Draghi, President of the European Central Bank (ECB), also reiterated his dovish stance and noted that monetary policy will remain accommodative for as long as necessary, while the ECB’s November interest rate cut showed his willingness to act on a data-driven basis. The region’s framework towards implementing a fiscal union has also begun to take

shape after the approval of the Single Supervisory Mechanism (SSM) and recent approval of the Single Resolution Mechanism (SRM). The SSM gives the ECB supervisory authority over 130 systematically important banks, representing more than 85% of total European banking assets. The Asset Quality Review is a key component to the SSM/SRM mechanisms, and is required before the ECB will undertake supervisory banking authority in the fourth quarter of 2014. Despite improving macro-economic fundamentals and a more aligned political environment, the region’s transmission mechanism continues to struggle as private loan growth remains on a declining trend. On the inflation front, the Eurozone’s consumer price index (CPI) rate stabilized at very subdued levels caused by insufficient aggregate demand, rather than being caused by high productivity or positive supply-side shocks. Real GDP is projected to decline by 0.4% in 2013, increasing by slightly more than 1% in 2014 and 1.4% in 2015. A significant amount of slack in the economy is expected to persist and the recovery process will be gradual.

Swiss economic conditions continued to improve in the second half of 2013, with Swiss GDP exceeding its pre-crisis level by about 5%. Swiss economic growth continued to look robust when compared to Europe’s economic development. This positive economic backdrop was driven by domestic demand, while the anticipated positive recovery in the export industry finally materialized. Services progressed significantly, helped by the sustained activity in the

construction sector, where the growth of mortgage loans has outpaced GDP growth for several years. The housing market continued to move higher with prices rising 4.6% year-over-year in the last quarter of 2013. However, the Swiss National Bank (SNB) repeatedly stressed the real estate market’s risk to financial stability. As a result, the Swiss government implemented countercyclical capital measures to curb real estate market development in 2013. Following the solid estimated GDP growth of 1.9% in 2013, the Swiss government expects growth to accelerate to 2.3% in 2014 and 2.7% in 2015, as there are good prospects for a strengthening economic upturn in Switzerland over the next two years. The SNB expects a growth rate of around 2.0% in 2014, while UBS revised upward its Swiss growth outlook for 2014 and 2015 to 2.1% and 2.4%, respectively, resulting from a more constructive assessment of Swiss consumer demand. From a business activity perspective, Swiss PMI continued to signal economic expansion, remaining at an elevated level in December (53.9), while correcting from the previous month (56.5) on the back of a weaker production’s sub-index. On a positive note, the most forward-looking backlog of component orders remained very encouraging. Moreover, the Swiss Economic Institute (“KOF”) economic barometer (one or two quarters ahead of the GDP growth rate of the previous year) surprised positively, reaching a two-year high and confirming a solid business climate underlying the improved momentum with the key Swiss industries.

On the monetary front, the SNB’s reserves remained around CHF 430 billion, largely unchanged at year-end. From a foreign exchange standpoint, the U.S. dollar is expected to strengthen against the Swiss franc in 2014 after the latter appreciated by 2.5% against the U.S. dollar, while depreciating by 1.6% versus the euro in 2013. After two years of negative inflation rates, the CPI rate is expected to move back to positive territory in 2014 driven by services prices generally as well as rent prices. However, December CPI contracted -0.2% month-over-month due to lower oil prices. Consequently, no inflation risks can be identified for Switzerland in the foreseeable future. Boding well for Switzerland’s momentum of economic growth, M3 money supply grew 7.6% year-over-year in December. SNB President Thomas Jordan reaffirmed the necessity to preserve the Swiss franc/euro exchange rate floor in case renewed tension on the sovereign market in the Eurozone is expected to materialize. As a result, the exchange rate cap of 1.20 EUR/CHF is likely to remain in place in the coming months without inflationary pressures in Switzerland and disinflationary trends in the Eurozone.

Market outlook

While deflationary risks remain, as highlighted recently by the International Monetary Fund, they seem to be receding. The United States should have less fiscal drag into 2014 compared to 2013, as the budget situation is improving and financial assets should not be affected too adversely by the

Federal Reserve’s limited slowdown in debt purchases. In addition, the U.S. real estate market is expected to stay strong. Europe, despite a less favorable liquidity situation than the United States (central bank balance sheet shrinkage, increase in current account surplus and tepid credit growth), is showing signs of recovery from a very low base. If the global economic situation continues to improve, the potential for higher interest rates should provide a good environment for value investing, encompassing small caps and higher risk assets. This scenario is supportive for the equity asset class, but expanded stock valuations and the length of the current bull market could result in high selectivity from investors and therefore a decrease in stock returns cross correlations. This should be a good environment for active management of an investment portfolio.

On the other side, this consensus view of better global economic growth is challenged by China’s transformation towards more balanced development triggered, in part, by the diminishing returns of capital stock. The need for China to reduce its excess credit expansion is creating an increase in bond yields for Chinese issuers and a reduction in monetary expansion. It is also interesting to observe how the U.S. current account deficit

is shrinking since 2006, both in absolute

terms and in percentage of GDP. This development is reducing the liquidity the United States produces for the rest of the world. This trend could be exacerbated by the phasing out of the Federal Reserve’s quantitative easing program and merits close monitoring.

In a scenario of disappointing global growth, lower risk free yields in developed economies are to be expected which, in the equity markets, would favor high quality growth stocks. Fund management believes the Fund’s portfolio is well positioned to face these uncertainties through exposure to companies in both the recovery and undervalued growth strategies.

Sincerely,

Alexandre de Takacsy

President

Rudolf Millisits

Chief Executive Officer

New Investments by the Fund

Basilea Pharmaceutica AG

DKSH Holding, Ltd.

Emmi AG

Evolva Holding SA

Galenica AG

Lonza Group AG

Meyer Burger Technology AG

Nobel Biocare Holding AG

Panalpina Welttransport Holding AG

Schweizerische National-Versicherungs-Gesellschaft AG

Swatch Group AG

Tecan Group AG

Weatherford International, Ltd.

Additions to Existing Investments

ABB, Ltd.

Actelion, Ltd.

Aravis Biotech II – Limited Partnership

Belimo Holding AG

Burckhardt Compression Holding AG

Lindt & Sprungli AG

Novartis AG

SelFrag AG, Class A

UBS AG

Zurmont Madison Private Equity, Limited Partnership

Securities Disposed of

Addex Pharmaceuticals, Ltd.

Adecco SA

Allreal Holding AG

Biotie Therapies Oyj

Dufry AG

Geberit AG

Givaudan SA

Holcim, Ltd.

OC Oerlikon Corp. AG

SGS SA

Sulzer AG

Swiss Re AG

Transocean, Ltd.

Xstrata PLC

Zurich Financial Services AG

Reductions in Existing Investments

Compagnie Financiere Richemont SA

Credit Suisse Group AG

Nestle SA

Roche Holding AG

Schindler Holding AG

Swiss Life Holding AG

Syngenta AG