HALF-YEARLY REPORT P&I PERSONAL & INFORMATIK AG 1 APRIL 30 SEPTEMBER

Transcription

1 HALF-YEARLY REPORT P&I PERSONAL & INFORMATIK AG 1 APRIL 30 SEPTEMBER 2009

2 Half-yearly report P&I AG Foreword from the Board of Directors Vasilios Triadis CEO / Chairman of the Board Dear Shareholders, Dear Ladies and Gentlemen, P&I AG has successfully overcome a difficult half-year with regard to the global economy and is wellequipped to realise our ambitious goals during the following six months. The first half-year was extremely difficult as the financial and economic crisis had a severe impact on P&I s business model. P&I is solely active in the capital goods industrial sector and realises well over 55% of sales with so-called One-shot businesses, which means that we sell licenses and provide advice during the launching of the software. Repetitive sales that do not involve any sales activities come from software support and simply account for 40% of the overall revenue. Another obstacle facing P&I is the type of software that we market. New HR management solutions are virtually always seen by companies and authorities as an alternative investment, as they already own solutions for settling benefits, salaries and wages. If there is no great danger posed to a company in times of crisis, then an investment in HR software can easily be postponed and actual revenue generating process will not be directly affected by this decision. We have achieved a good result despite the difficult situation, as we have already started to implement countermeasures through strategic and the resulting structural changes. The success of these measures means that we are confident of being able to continue fulfilling the expectations of our shareholders. Our confidence is based on the measures that have been taken, that helped us to successfully withstand the crisis earlier on. The sustainability of these measures is of extreme importance, as our view is that we are still nowhere near the start of a recovery phase. Our judgement is that a noticeable economic recovery is purely wishful thinking at the moment. Consumption did not completely collapse previously but the crisis started with a gradual downswing and we still cannot hope for a strong upswing in the foreseeable future. Subsequently, it appears very clear that 2010 will be a fateful year for many companies. The reduced working hours phase will have ended and the companies will then have to try to survive, despite major structural changes and cuts. Consequently, no consideration will be given to investing in new human resources software at the present time. We must not only recognise and accept and these structural changes, but we must also press ahead on a different basis in order to continue to be successful using new business models. 12 months ago, which also coincided with the start of the financial crisis, we started to realign our product portfolio so that business with existing customers was intensified. This was realised by developing add-ons 2

3 Foreword from the Board of Directors Half-yearly report P&I AG to our existing software modules, which our customers have placed right at the top of their purchasing list. However, the price of each of these modules lies well below the price of a complete system and the added benefits for our customers are so great that despite the crisis these relatively small investments will either be implemented or not. Consequently, we have provided our customers with new perspectives as part of using our software, which developed further close co-operation and reinforced their trust in us. This enabled us to more than partially compensate for the license sales that we were unable to close with new customers. We have also clearly and simultaneously increased the attractiveness of our complete solution with regard to new customers, which places us in a very good starting position as compared to our competitors should an upswing occur at some point in the future. It is not only the expansion of our product portfolio that has strengthened our customer relationships as we started implementing changes to our consulting strategy two years ago. Consultations with each customer are now undertaken by a consultant who has been personally assigned to a specific company. Not only did we improve the consulting service, we also increased the cost-effectiveness at the same time! Consulting sales of 4.8 million euros in the Quarter just ended, means that we have recorded a 20% increase of nearly 4 million euros on the previous year s sum. Consulting sales have increased by nearly 15% over the full halfyear when compared to the previous year s comparable period. With regard to further economical developments we must assume that the difficult situation will remain unchanged, which means that we do not see any alternative but to remain on our set course and to continue to invest in additional modules, which we provide to our existing customers as useful add-ons to our solution. Consequently, we decided during the last Quarter to continue to invest 20% of our sales revenue in Research and Development. Today we are selling modules that we have been developing over the last three years. P&I HCM as well as the time management system integrated in P&I LOGA count as HR management systems. These two modules are powerful, flexible, innovative solutions that have been customised to meet the needs of many industries and they are both easy to install and easy to use. Today we have to develop modules that will generate a major part of our sales in two years time. Our customers will also be able to benefit from these developments. You are right in expecting us to also use the revenue from software support to further develop our software with regard to future-orientated solutions. The crisis is not making us unduly nervous as we have implemented early precautions to ensure that our measures are sustainable and that we will continue to survive easily after the poor overall economic situation has passed and that after the crisis we will have realised an expanded product portfolio and we will therefore be even better placed than we were beforehand when compared to our competitors. Yours faithfully, Vasilios Triadis P&I AG CEO / Chairman of the Board 3

4 Half-yearly report P&I AG Key Figures Group Key figures acc. to IRFS Change Change 000 euros / not verified Percent Group sales 30,194 29, % Earnings before depreciation (EBITDA) 8,324 9, % Earnings before interest and taxes (EBIT) 7,094 7, % Profit or loss for the period 5,131 5, % Number of Employees in average period % (DVFA/SG) % Highlights Group sales rose by 3% The P&I Group realised an operating result of 7.1 million euros in the first six months of fiscal 2009/2010 (previous year: 8.0 million euros), which represents an EBIT margin of 23.5% (previous year: 27.1%). Sales rose 29.4 to 30.2 million euros during the same period and once again the highprofit maintenance business as well as the strong service business proved to be the P&I s main growth engines. P&I s tender for the state personnel management system in Sachsen-Anhalt has been accepted This contract, which has a volume in excess of 5 million euros, awarded by the Finance Ministry of the State of Sachsen-Anhalt is the third biggest contract that we have closed in the history of P&I. Our P&I PLUS software covers all of the requirements regarding HR management software at regional government level including the police and schoolteacher requirements. Share price development and dividend pay-out P&I s share price continues to develop positively. It was at 11 euros at the start of the fiscal year and it closed at euros at the end of September A dividend pay-out was resolved at the annual general meeting held on September 1, A dividend amounting to one euro per share was paid out on September 2,

5 Management Report Half-yearly report P&I AG Orders and Sales After recording sales of 15.1 million euros in the first quarter (previous year: 15.6 million euros) sales in the second quarter 2009/2010 also amounted to 15.1 million (previous year: 13.7 million euros). Consequently, sales totalling 30.2 million euros for the half year were virtually 3% above the level realised during the previous year (29.4 million euros). A strong service business and growth in the high-profit maintenance business were the significant factors that contributed to this success. Overall licensing sales dropped back as expected due to a negative one-off effect posted in the last half of the previous year. Therefore we can safely say that the P&I Group has maintained its position very well despite the economic and financial crisis. Licensing sales amounted to 8.3 million euros (previous year: 10.2 million euros). The previous year s licensing business included a special project valued at 1.5 million euros. Projects of this size were not expected to materialise during the first six months of this fiscal year. Due to the application of the PoC method (sales realisation according to the degree of completion), the initial sales impact of the newly acquired major project will only start during the coming fiscal year. The licensing business share of total Group sales amounts to 27%. A revenue of 11.9 million euros was generated by the maintenance business. Year-on-year, this represents an increase of 1.6 million euros or 15.5% and corresponds to a 40% overall share of Group sales. The excellent maintenance business is mainly the result of the successful licence sales realised during the previous year. The acquisition-contingent maintenance sales amount to 0.5 million euros (pro rata regarding P&I Zeitmanagement GmbH as well as JET PABIS NG). An increase should also be recorded in the service business. Shown here are revenues from seminars and training courses in addition to those arising from introductory projects and from ongoing support for existing customers. P&I increased the comparable previous year's result by 1.2 million euros to 9.3 million euros, with 31% of revenue coming from the Consulting/SI business segment. Incoming orders (licenses, consulting and maintenance) amount to 37.0 million euros, which is clearly well above the previous year's level (30.5 million euros). Orders on hand include a future maintenance income of 23.4 million euros (previous year: 20.3 million euros) over the next 12 months. Segment results Segment reporting is now carried out by applying the "through the eyes of management" approach. Please refer to the explanatory notes contained in Item 4 in the Notes to the financial statement issued on March 31, 2009 for an explanation of the segmentation. The German business segment was enlarged by the acquisition of P&I Zeitmanagement GmbH on May 1, The Board of Directors monitors each business segment's operating results separately, in order to determine the allocation of resources and to undertake an evaluation of the earning power of each segment The earning power of each individual segments is assessed on the basis of its operating result (EBIT). Segment EBIT and Group operating result (EBIT) are measured in conformity with IFRS. Finance costs, finance revenues and taxes on income are managed at Group level. 5

6 Half-yearly report P&I AG Management Report Their development is set out as follows: '000 euros Sales Germany with third parties 23,915 23,951 with other segments 1, Total 24,915 24,651 Umsatz Österreich with third parties 3,284 2,844 with other segments 0 0 Insgesamt 3,284 2,844 Other foreign countries with third parties 2,995 2,555 with other segments 0 0 Total 2,995 2,555 Eliminations -1, Group 30,194 29,350 EBIT Germany 5,943 7,103 Austria Other foreign countries Total 7,094 7,966 Financial result Group result before tax 7,292 8,587 Profit situation and cost development The operating result of 7.1 million euros dropped by 0.9 million euros when compared to the previous year s result. The EBIT margin now amounts to 23.5% as compared to 27.1% for the previous year. This negative development is attributed to the cost increases, which can only be partially compensated for by the increase in sales. This also resulted in the return on sales being reduced to 17.0% (previous year: 20.3%). 6

7 Management Report Half-yearly report P&I AG The Group earnings situation is determined by the parent company and domestic business. The acquisition of P&I Zeitmanagement GmbH in Höxter contributed to the incurred costs in this case. In addition to this the costs incurred by the new Slovakian branch in Zilina during the previous year have not yet been included in the overall half-yearly report. Furthermore, one-off costs were accumulated in conjunction with Investor Relations activities. Foreign business has increased in comparison to the previous year, especially the segment result in Austria, which has improved significantly. This is in contrast to Germany, where business with third parties has remained fairly constant. A good 16.2% (previous year: 10.8%) of the operating result was generated by P&I Group's foreign business. Research & Development A strong product is the prerequisite for sustainable development. P&I has established itself in the HR market with five strong brands. With the P&I LOGA, P&I HCM and P&I PLUS products, P&I possesses a valuable portfolio of brands in the European software industry. With P&I SMART, P&I has separated off the lower part of its market segment. Our P&I Time stand-alone solution has established P&I as the expert in the time management sector. An investment of 6.0 million euros was made in Research and Development for product improvement, updates based on legislation changes and collective bargaining arrangements-agreements, and development of new technologies. This corresponds to 20.0% of total sales (previous year: 19.9%). Additional development costs where incurred, when compared to the previous year, from the expansion of our Slovakian development centre and the acquisition of P&I Zeitwirtschaftmanagement and the new P&I Time product. The new P&I Scout Pro module is designated as one of the first half year s projects in addition to the further development of our HR control centre. P&I Scout Pro has enabled P&I to release a new function within our P&I LOGA product. The module provides the option to create a simple and fast evaluation method and to display it graphically. Whether it is downtimes or overtime statistics: P&I Scout Pro will create the evaluation directly from the basic personal data, travel costs or the applicant management module in P&I LOGA. Legislation changes created another development focal point. Accounting relevant matters such as federal contributions for legal health insurance or supporting short-time working have been incorporated in our Economic Packet II. The latest accounting-relevant measures have been effective since July 2009 and P&I therefore decided to implement a maintenance release during the course of the year. P&I LOGA user can now be used throughout the European SEPA (Single Euro Payment Area) payment area. The Development department is now working at full capacity regarding the preparations for the beginning of the new year. As from January 1, 2010 the ELENA (electronic payment certificate) system will become the third obligatory electronic process in use in addition to DEÜV and ELSTER. The ELENA process application area law covers five payment certificates together with their corresponding administration processes. The payment certificate dates will be reported to the central data registry (Zentrale Speicherstelle/ZSS) every month by the employers in the form of a multi-functional income data record (Multifunktionaler Verdienstdatensatz/MVDS). An office calling up the relevant payment data provided by the central data registry will be permitted to access it provided that prior permission has been granted by the participant. Assets and profit The financial crisis has increased the importance of securing liquidity enormously over the last few months. The P&I Group has paid due attention to this fact. The financial situation of the Group remains sound. The 7

8 Half-yearly report P&I AG Management Report Group has had no need for short-term refinancing and has access to sufficient financial resources for the future development of the concern. The cash-flow account clarifies the increase in cash and cash equivalents by 5.2 million euros in the first six months of fiscal 2009/2010. This can be initially characterised by shifting financial assets available for sale into cash and cash equivalents amounting to 16.8 million euros available for investments. This reduces the effect of the payment made for the purchase of P&I Zeitmanagement in Höxter and this outweighs the business related payments made in operational areas. Financing included the payment of 7.5 million euros as the dividend distribution to our shareholders. Thereafter remains a holding of liquid assets and liquid asset equivalents totalling 11.8 million euros. The cash-flow from operating activities dropped slightly from -1.7 million euros to -2.1 million euros. Payments, especially those from personnel cost provisions and tax prepayments exceeded the proceeds from the ongoing business. As the maintenance invoices are always sent out at the start of the calendar year, the payments for fiscal 2009/2010 will only start to flow in the 4th quarter of P&I s fiscal year. The cash-flow from investment activities increased from -1.3 million euros recorded in the comparable period during the previous year to 15.4 million euros. The P&I Group placed part of the funds from Maintenance annual income for 2009 in money market funds and term deposits with a term of more than three months. However, as the money is still available it has been added to the liquid funds. In addition to this, the cash balance for investments includes the payment for the purchase of P&I Zeitmanagement GmbH in Höxter. The cash-flow from the financing activities amounted to -8.1 million euros (previous year: -4.6 million euros) and this includes the dividend distribution as well as the share buyback scheme (0.5 million euros). With a liquid assets and available-for-sale financial assets holding amounting to 21.2 million euros (March 31, 2008: 33.3 million euros) the P&I Group is in a very sound financial position. This guarantees the Company's independence - especially in times of economic and financial crisis. The P&I Group s balance sheet has been reduced by 21.2% and amounts to 48.1 million euros (March 31, 2009: 61.0 million euros). The worth of the P&I Group s long-term assets amounted to 11.9 million euros (March 31, 2009: 10.5 million euros), thus recording an increase of 1.4 million euros in the year under review. This is attributable to the purchase of P&I Zeitmanagement GmbH in Höxter. This activated a customer base valued at 1.3 million euros, software valued at 0.1 million euros and goodwill worth 0.8 million euros. This reduces the effect of the depreciation and the current impaired value in fiscal 2009/2010. The value of the short-term assets dropped by 14.3 million euros to 36.1 million euros due to the outflow of funds from the operating activities, company acquisitions and the dividend distribution. The decline in receivables from 15.4 million euros to 13.9 million euros is mainly attributable to the contractually agreed instalment payments from major projects. The liquid resources (liquid funds, securities and available for sale financial assets) amounted to 21.2 million euros (previous year: 16.2 million euros). The decline in the balance sheet resulted in an increase in the equity ratio from 48.9% (as of March 31, 2009) to 56.0%, despite the lower equity. 8

9 Management Report Half-yearly report P&I AG The deferred tax liabilities posted under long-term liabilities increased by 0.4 million euros to 2.2 million euros when compared to March 31, 2009 mainly due to the accrued income neutral deferred tax liability, which resulted from the acquisition of P&I Zeitmanagement GmbH in Höxter. Short-term liabilities were clearly reduced by 10.1 million euros to 18.2 million euros. The main reason for this was the liquidation of the prepaid maintenance fees (-9.4 million euros), which are posted at the start of the calendar year due to the annual invoices and reversed monthly in accordance with the sales realisation. Furthermore, the payment obligations to personnel resulting from the variable compensation components, which were carried as liabilities at the end of the previous year, were paid out. Employees There were 362 employees working in the P&I Group on September 30, 2009 (September 30, 2008: 341). This increase is related to the acquisition: 33 new employees, of which 9 are trainees, joined us as the result of the purchase of P&I Zeitmanagement GmbH. The yearly average of fill-time equivalent employees increased to 333 (previous year: 298). There were 248 people employed in Germany and a total of 85 employees in the rest of Europe where the Company was represented in Austria by 28 employees and more strongly represented in Slovakia, with 42 people being employed at the development centre. Chances and Risks In the past, we have made certain acquisitions, and we shall continue to consider possible purchases for the future. This of course means that the P&I group is subject to acquisition and integration risks. With regard to the licensing business and as a direct consequence of the economic and financial crisis, the risk that customers will postpone a planned migration from an legacy product to a P&I software solution is greater. Apart from this, there has been no significant change in the risks and chances in comparison with the assessment of these set out in the annual report of March 31, Controllable risk is managed under a company-wide risk management system at P&I AG. Outlook 2009/2010 The P&I Group has continued with stable development during the 2nd Quarter in an extremely difficult market place. The P&I business model has proven itself once again: a strong service business and growth in the high-profit maintenance business were the significant factors that contributed to this success. Our customers place their trust in P&I and P&I looks after their customers. Licensing sales dropped back as expected due to a negative one-off effect posted in the last half of the previous year. Due to the prevailing conditions we are now focussing on generating license sales on one side and on the public administration sector on the other as well as trying to close a variety of small orders from our existing customer base, especially in the private sector. It is proving extremely difficult to win new projects and new customers in the current market place. The decision made by the Sachsen-Anhalt regional government in August to purchase from P&I confirms the power of our P&I PLUS product as well as the competence and professionalism of our consultation organisation. The project s sales realisation will be based on the degree of completion. The overall sales and results for the first halfyear of fiscal 2009/2010 correspond to our expectations. All in all, P&I can restate its forecasts for fiscal 2009/2010: license sales of million euros and total sales of million euros and an EBIT margin of 15% - 20%. With our excellent and comprehensive product portfolio, our transparent, well-focused corporate strategy, our professionalism and affordable price structures, we have no doubt that we can continue to build on our sturdy market position in the future. We are confident that we will continue to realise our goals in the future as well. 9

10 Half-yearly report P&I AG Consolidated Balance Sheet Balancing acc. to Sept. 30, 2009 March 31, 2009 IFRS accounting principles not verified verified Details in 000 euros Assets Long-term assets Tangible assets Customer base 6,585 5,992 Goodwill 1,951 1,161 Other intangible assets 1,072 1,049 Financial assets Deferred taxes Total Long-term assets 11,933 10,523 Short-term assets Inventories Trade receivables 13,912 15,353 Cash and cash equivalents 11,801 6,558 Available-for-sale financial assets 9,410 26,681 Other Short-term assets 843 1,761 Total Short-term assets 36,146 50,494 Total assets 48,079 61,017 10

11 Consolidated Balance Sheet Half-yearly report P&I AG Balancing acc. to Sept. 30, 2009 March 31, 2009 IFRS accounting principles not verified verified Details in 000 euros Equity and Liabilities Shareholders' Equity Subscribed capital 7,700 7,700 Capital reserve Revenue reserve 19,444 22,376 Other equity Total shareholders' equity 26,924 29,840 Long-term liablities Deferred taxes 2,243 1,820 Long-term obligations towards employees 728 1,077 Total Long-term liabilities 2,971 2,897 Short-term liabilities Trade payables 1,870 2,235 Obligations from taxes on income 3,022 2,542 Accrued taxes 5,519 15,611 Other Short-term liabilities 7,773 7,892 Total Short-term liabilities 18,184 28,280 Total liabilities 21,155 31,177 Total equity and liabilities 48,079 61,017 11

12 Half-yearly report P&I AG Consolidated Statement of Income Consolidated Statement of Income acc. to IFRS Quarterly report Quarterly report Half-yearly report Half-yearly report Details in 000 euros / not verified Sales 15,079 13,737 30,194 29,350 Cost of sales 4,967 4,388 9,656 8,456 Gross profit 10,112 9,349 20,538 20,894 Research and development expenses 3,074 3,058 6,046 5,839 Sales and distribution expenses 1,945 2,008 3,804 4,088 Administrative expenses 973 1,038 2,104 2,100 Write-down of goodwill and customer bases Other operating income Other operating expenses 1, , Result of ordinary activities (EBIT) 3,065 2,874 7,094 7,966 Income from investments Financing expenses Result of ordinary activities before tax (EBT) 3,172 3,251 7,292 8,587 Tax expenses *) 867 1,041 2,161 2,642 Profit or loss for the period 2,305 2,210 5,131 5,945 Average number of shares (diluted/undiluted) 7,527,199 7,700,000 7,527,199 7,700,000 Earnings per share in euro (diluted/undiluted) *Tax expenses account both the paid taxes on income and deferred taxes on ordinary business activities. 12

13 Half-yearly report P&I AG Cash-flow Statement Cash-flow Statement Half-yearly report Half-yearly report acc. to IFRS accounting principles Details in 000 euros / not verified Cash-flow from operating activities Profit or loss for the period 5,131 5,945 Adjustment for the reconsiliation of the net income/- loss to net cash provided by operating activities Depreciation on tangible assets, intangible assets and financial assets 1,230 1,069 Financial results Taxes on income 2,161 2,642 Change in inventories, receivables and other assets not attributable in investing of financing activities 2, Change in payables and other liabilities not attributable in investing of financing activities -11,719-10,006 Losses/income from sales of fixed assets 34 0 Losses/income from sales of current assets Changes in other items not affecting payments Interest paid 0-10 Interest received Tax payments -1,517-1,843 Net funds from operating activities -2,098-1,705 13

14 Cash-flow Statement Half-yearly report P&I AG Cash-flow Statement Half-yearly report Half-yearly report acc. to IFRS accounting principles Details in 000 euros / not verified Cash-flow from investing activities Payments for investments in tangible assets Payments for investments in intangible assets Proceeds from the sale of tangible/intangible assets 0 7 Proceeds from the sale of long-term security investments 0 23 Proceeds from the sale of short-term security investments 17,284 6,000 Payments for the purchase of short-term security investments 0-5,010 Payments for the acquisition of affiliated companies -1,692-1,964 Net funds from investing activities 15,399-1,333 Cash-flow from financing activities Repayment for the acquisition of own shares Repayment for the distribution of the dividend -7,523-4,620 Net funds from financing activities -8,058-4,620 Change in cash and cash equivalents 5,243-7,658 Cash and cash equivalents at the beginning of the fiscal year 6,558 12,886 Cash and cash equivalents at the end of the period under review 11,801 5,228 14

15 Change in Shareholders' Equity Quartalsbericht P&I AG Change in Shareholders' Equity Half-yearly Half-yearly Annual report report report /2009 Details in 000 euros not verified not verified verified Shareholders' equity at the beginning of the fiscal year 29,840 26,673 26,673 Subscribed capital Capital reserve Revenue reserve Own shares ,484 Other shareholder's equity Distribution -7,523-4,620-4,620 Balance sheet result 5,131 5,945 8,966 Shareholders' equity at the end of the period 26,924 28,151 29,840 Basic Principles of the Consolidated Financial Statement In accordance with Article 4 of the Regulation (EC) No. 1606/2002 of the European Parliament and Council of Europe of July 19, 2002 concerning the use of international financial accounting standards (ABl EC No. L 243/1) the Company compiles its quarterly report according to International Financial Reporting Standards (IFRS). In compiling the consolidated financial statements, the Company has additionally observed and applied the provisions of 315a Para. 1 of the German Commercial Code (HGB). All IFRS (IFRSs, IASs, IFRICs, SICs) valid at balance sheet date were complied with in the manner required in the European Union. The consolidated financial statements have been compiled in euros. Unless otherwise stated, all values have been rounded to thousand euros. Accounting principles to be applied for the first time from September 30, 2009 The following standards or changes are to be first applied to all fiscal years starting after January 1, 2009: Changes made to IFRS 1 First-time Application of the International Financial Reporting Standards and IAS 27 Consolidated and Separate Financial Statements according to IFRS Changes to IFRS 2 Share-Based Payments Changes to IAS 1 Presentation of Financial Statements Changes made to IAS 23 Borrowing costs: Changes made to IAS 32 Financial Instrument: Presentation and IAS 1 Presentation of the Financial Statements - Cancellable Financial Instruments and Obligations in the Case of a Liquidation Collective standard for changes to various IFRS (2008) Improvements to IFRSs IFRS 8 Business Segments The IFRS 8 Business Segments standard was initially applied on a voluntary basis in fiscal 2008/2009. The other standards will be provided that the changes apply to the P&I Group applied initially in fiscal 2009/

16 Half-yearly report P&I AG Selected facts and figures from the notes to the financial statements Changes in the consolidated companies The Gronemeyer Gesellschaft für Datentechnik, EDV und Organisationsberatung mbh (now trading as P&I Zeitmanagement GmbH), Höxter, was acquired as of May 1, An interim financial statement was released on April 30, An opening balance sheet for the company up to May 1, 2009, which was fully consolidated at this point in time, can be found in this financial statement. The provisional acquisition costs were apportioned as follows: In '000 euros Carrying amount Fair value Liquid funds Trade receivables Other Assets Fixed assets Trade payables Other Liabilities Liabilities due to original shareholders Deferred income Deferred tax liabilities -434 Fair Value of the net assets Customer base 0 1,251 Software Goodwill from acquisition of a company Total -28 1,718 Cash outflow arising from acquisition of a company Cash outflow 1,718 Acquired cash 26 Outflow of funds arising from acquisition of a company 1,692 The differential amount between the fair value of the net assets and the purchase price of the participation generated a goodwill of 1,746,000 euros. This was initially assigned to the identifiable assets, the customer base (1,251,000 euros) and software (138,000 euros). The software is considered to be a topping up amount, which is formed in addition to the capitalised value that already exists in the commercial balance sheet (represented in the P+I Zeitmanagement GmbH s fixed assets). This leaves a goodwill of 357,000 euros. This resulted in a temporary difference with the tax statement, due to the customer base and software accounting in the IFRS Commercial Balance Sheet, which resulted in a deferred tax liability charge of 16

17 Selected facts and figures from the notes to the financial statements Half-yearly report P&I AG 434,000 euros. However, the goodwill will not be reduced by this amount, which means that the total goodwill remains at 791,000 euros. The income neutral deferred tax liability will be posted later on as revenue according to the deferred taxes on the depreciations to the customer base and software. The purchase price allocation is still provisional and changes may follow. The balance sheet items were tested for recoverability. There are no hidden reserves or encumbrances. There are no contingent liabilities. The acquired customer base is to be written down over ten years and the software over five years. P&I Zeitmanagement GmbH in Höxter recorded sales of 802,000 euros and taking into account the synergy effects since being acquired on May 1, 2009, has made a balanced contribution to the company results up to September 30, Financial statements for the previous year were not compiled for comparison purposes for economic reasons. The new company has reinforced P&I s position and competence as a provider of integrated HR software solutions in the time management product line. The standard APG2000 software, which is platform-independent and can be customised to meet individual needs, provides integrated expertise through its access control and personnel deployment options. Notes on the Profit and Loss Accounting Other operating income mainly includes refunds and an insurance payment for the settlement of claims for damages arising from a customer project. Other operating expenses includes a settlement of claims for damages in addition to the ongoing investor relations activity expenses (i.e. AGM, etc.). Furthermore, the position also covers the IR-expenses incurred by an external consultation company. The engagement was made after the Board addressed potential investors and reassured them about market rumours concerning an impending takeover. A fragmented share structure, the company s good economic condition as well as the sustained low share prices made the P&I Group an attractive takeover candidate at the end of the last year and in Spring The contract with the consultation company was terminated in July after the reentry of the Carlyle Group. The financial result amounting to 198,000 euros (previous year: 621,000 euros) mainly includes earnings on interest from bank balances and securities. The taxes on income shown include both paid and unpaid taxes on income of 2,156,000 euros (previous year: 2,390,000 euros) as well as deferred tax liability expense of 5,000 euros (previous year period: 252,000 euros). The combined tax rate applicable to P&I AG takes into account the business tax assessment rate of 432%, the new corporate tax rate of 15% and the solidarity surcharge of 5.5%. The ensuing deferred tax liability, which is only implemented under commercial legislation and not under the tax regulations, is due to the customer base depreciations. Notes on the balance sheet Investments made during the first halfyear of fiscal 2009/2010 amounted to 2,233,000 euros (previous year: 3,770,000 euros). Included in the fiscal year are the customer base (1,251,000 euros), software (138,000 euros) and goodwill (356,000 euros) from the acquisition of P&I Zeitmanagement GmbH in Höxter. The previous year s amount covered the customer base (250,000 euros) and the software (614,000 euros) from the acquisition of P&I Steyr GmbH as well as the customer base from the acquisition of the JET PABIS NG (2.408,000 euros) business area. Cash and the financial assets available for sale are constituted as follows: 17

18 Half-yearly report P&I AG Selected facts and figures from the notes to the financial statements '000 euros 30. September March 2009 Cash on hand and in bank balances 11,801 6,558 Available-for-sale financial assets 9,410 26,681 Total 21,211 33,239 Of the trade receivables of 13,912,000 euros (March 31, 2009: 15,353,000 euros) there was still 75% (March 31, 2009: 78%) that was not yet due. Of the receivables totalling 4,324,000 euros that were still overdue at balance sheet date, approx. 50% had been overdue for a maximum of one month. The capital stock of the Company remained unchanged at 7,700,000 euros as at September 30, 2009 and is divided into 7,700,000 individual share certificates made out to bearer. The entry for other equity of 209,000 euros (March 31, 2009: 193,000 euros) mainly reflects the exchange rate differences arising from the valuation of securities. Other long-term accruals include the obligations arising from the long-term bonus scheme for one member of the Board of Directors. Changes in shareholder group and executive bodies In accordance with 95 AktG (German Companies Act) and in conjunction with 6 of the version issued on the September 1, 2009, the Company has a Supervisory Board consisting of three members. Michael Wand, Chairman, since 1. September 1, 2009; Klaus C. Ploenzke, Chairman until 1. September 1, 2009; Robert Vinall, deputy chairman since September 1, 2009; Michael Pluemer, deputy chairman of the Supervisory Board until September 1, 2009; Dr. Thomas Heidel, since September 1, Shareholdings of the Company and Members of the Executive Bodies As at September 30, 2009, P&I Personal & Informatik AG has shareholdings of 177,248 of its own shares. The purchase price of our own shares amounted to 2,018, euros and this sum was paid from equity. No convertible bonds or similar securities pursuant to 160 Para.1 No. 5 AktG had been issued by P&I Personal & Informatik AG or other companies pursuant to 160 Para. 1 No. 2 AktG as at September 30,2009. Michael Pluemer, Deputy Chairman of the Supervisory Board since August 28, 2007 until September 1, 2009, holds 2,500 shares in P&I AG at the date of his retirement. As at September 30, 2009, no other members of the Board of Directors or the Supervisory Board held P&I shares or options. No share-based payment scheme for members of the Board of Directors exists. Dividends The net profit shown in the annual financial statements of P&I Personal & Informatik AG is, pursuant to the German Companies Act, material to a dividend distribution. How the net profit for fiscal 2008/2009 will be used was resolved as follows at the AGM held on September 1, 2009: Dividend payout of 1.00 euro per no-par share entitled to a dividend. 18

19 Selected facts and figures from the notes to the financial statements Half-yearly report P&I AG Euros Dividends 7,522, Profit carried forward 9,008, Retained earnings 16,530, The own shares held by P&I AG that are not entitled to a dividend were not taken into account. Share buyback scheme On October 23, 2008, the Board of Directors of P&I Personal & Informatik AG resolved to institute a share buyback scheme. Company shares amounting to up to four per cent of capital stock (a limit of 308,000 shares) are to be acquired on the stock exchange. However, the maximum price to be paid (excluding ancillary acquisition costs) should not exceed 4.5 million euros. The Board of Directors intends, with the consent of the Supervisory Board, to retire those of its own shares acquired during the buyback, thus reducing the capital stock. However, the Board of Directors reserves the right to use all or some of P&I's own shares for some other purpose, within the limitations of the authorisation granted by the AGM of September 2, The share buyback scheme ran until September 30, 2009 and has therefore finished. A total of 177,248 shares were repurchased during the period from October 27, 2008 to September 30, The number of repurchased shares corresponds to a proportional amount of the capital stock of a total of 177, million euros, which is 2.30 % of shares issued at the date of adoption of the resolution. The payments made amounted to 2,019,000 euros. Earnings per share In determining the earnings per share according to IAS 33, the annual profit attributable to the shareholders is divided by the weighted average of the ordinary shares issued. A share buyback scheme was introduced during the previous year. A share buyback of this kind reduces the shares outstanding but does not lead to potential shares. For this reason, the earnings per share remains undiluted. Should the average number of shares have changed since the last reporting date, however, the weighting should be calculated pro rata temporis and to the exact day. The p.r.t. weighting is carried out by taking the ordinary shares outstanding at the beginning of the period and adjusting them by the number of ordinary shares which have been repurchased during the period, then multiplying this figure by the time-weighting factor. The time weighting factor is the number of days during which the shares are outstanding as a proportion of the total number of days in the period. A total of 177,248 shares were repurchased during the period October 27, 2008 and September 30, As at September 30, 2009 the weighted average number of shares was 7,527,199. This results in basic (undiluted) earnings per share of 0.68 euro. Variable Board of Directors' remuneration Remuneration for the members of the Board of Directors is determined by the Supervisory Board and comprises both fixed and variable components. The fixed component, aside from a fixed-amount monthly remuneration, also includes benefits in kind, in particular the valuation for company vehicles to be applied in compliance with German taxation regulations. One part of the variable component of the Board of Directors' remuneration constitutes a performance related target income. The amount of the performance related target income is calculated on the basis of the degree to which the target Group EBIT (earnings before interest and taxes) set by the Supervisory Board has been fulfilled. 19

20 Half-yearly report P&I AG Selected facts and figures from the notes to the financial statements Bonus schemes also constitute part of the Board of Directors' variable remuneration: Payment of a longterm bonus (providing a long-term incentive) as a variable remuneration component was agreed on with one member of the Board of Directors with effect from September 1, Granting of the long-term bonus and its amount are dependent on the achievement of the target Group EBIT agreed previously with the Supervisory Board, and on the degree to which targets have been met in the respective fiscal year, and are also strictly dependent on the continuation of the board member's employment contract. The term of this agreement extends to the end of fiscal 2011/2012. Payment of a bonus as a variable remuneration component was agreed on with one further member of the Board of Directors, with effect from April 1, Granting of the bonus and its amount are dependent on the achievement of the target Group EBIT agreed previously with the Supervisory Board, and on the degree to which targets have been met in the respective fiscal year, and are also strictly dependent on the continuation of the board member's employment contract. The term of this agreement extends to the end of fiscal 2011/2012 in accordance with the extended term of the contract of employment for members of the Board of Directors. Notification of voting rights pursuant to 26 Para. 1 German Securities Trading Act (WpHG). The company registered several investments in the first halfyear of fiscal 2009/2010 in compliance with 21 ff. of the German Securities Trade Act. Argon GmbH & Co. KG, Munich, a subsidiary of the Carlyle Group, registered a 29.34% share of voting rights (2,259,000 votes). Of these 4.44% (341,700 votes) were assigned to it pursuant to 22 Para. 1 No. 5 WpHG. These and all other investment registrations made during the period under review can be found in the notes at the end of this section of the report. Relations with closely related enterprises or persons In the first halfyear of fiscal 2009/2010 drawings amounting to 24,000 euros for payments to closely related enterprises or persons were made (previous year: 26,000 euros). Relationships exist with the following closely related enterprises or persons: Mr. Klaus C. Ploenzke, member of the Supervisory Board of P&I Personal & Informatik AG, Wiesbaden, advises and supports the Company in making contact with new customers and also in identifying possible acquisitions and analysing synergy potential with these. Consultation services undertaken during the first halfyear of fiscal 2009/2010 amounted to 11,000 euros (previous year: 13,000 euros). Mr. Michael Pluemer, Supervisory Board member of P&I Personal & Informatik AG, Wiesbaden, advises and supports the Company in the development of the Business Process Outsourcing (BPO) business area as well as identifying possible acquisitions and carrying out their purchase. Consultation services undertaken during the first halfyear of fiscal 2009/2010 amounted to 13,000 euros (previous year: 13,000 euros). The services performed involved mainly consultation, development and other supporting services. The terms and conditions for the transactions with closely related enterprises and persons are in accordance with normal market practice and certainly comparable with any the Company may have arranged with independent third parties (price comparison method in accordance with IAS 24.12). All of the consultation contracts listed here that were undertaken by the members of the Supervisory Board were undertaken with the approval of the Supervisory Board. 20

21 Responsibility Statement Half-yearly report P&I AG Responsibility Statement "To the best of our knowledge, and in accordance with the applicable reporting principles for interim financial reporting, the interim consolidated financial statements give a true and fair view of the assets, liabilities, financial situation and profit or loss of the group, and the interim management report of the group includes a fair review of the development and performance of the business and the situation of the group, as well as a description of the principal opportunities and risks associated with the expected development of the group." Wiesbaden, November 5, 2009 Board of Directors 21

22 Half-yearly report P&I AG Selected explanatory notes Notification of voting rights pursuant to 26 Para. 1 German Securities Trading Act (WpHG). Der Gesellschaft ist im ersten Halbjahr des Geschäftsjahres 2009/2010 mitgeteilt worden, dass folgende neue Beteiligungen gemäß 21 Abs. 1 des Wertpapierhandelsgesetzes (WpHG) bestehen: Invesco Perpetual from Oxfordshire (United Kingdom) has declared to P&I Personal & Informatik AG on May 26th, 2009: The Invesco Limited from Hamilton (Bermuda)hereby gives notice, that on 22nd of May 2009 the voting interest in P&I Personal & Informatik AG fell below the threshold of 3% and amounted to 1.37% (this corresponds to 106,010 voting rights). These voting rights are in their entirety attributed to Invesco Limited in accordance with sec. 22 para. 1 sent. 1 no. 6 and sent. 2 of the WpHG. The Invesco UK Limited from London (United Kingdom) hereby gives notice, that on 22nd of May 2009 our voting interest in P&I Personal & Informatik AG fell below the threshold of 3% and amounted to 1.37% (this corresponds to 106,010 voting rights). These voting rights are in their entirety attributed to Invesco UK Limited in accordance with sec. 22 para. 1 sent. 1 no. 6 and sent. 2 of the WpHG. The Deutsche Bank AG, London (United Kingdom) has declared pursuant to sec. 21 para. 1 WpHG to P&I Personal & Informatik AG on May 28th, 2009: We hereby give notice, that on 25th of May, 2009 the percentage holding of the voting rights held by our subsidiary DWS Investment GmbH, Frankfurt (Germany) in P&I Personal & Informatik AG fell below of the threshold of 3% and amounted to 2.95%. The total number of voting rights is 227,000. Hermes Administration Services Limited, London (United Kingdom) has declared pursuant to sec. 21 para. 1 WpHG to P&I Personal & Informatik AG on 15 June 2009: We, Hermes Administration Services Limited as the authorised administration agent on behalf of BT Pension Scheme Trustees Limited, Lloyds Chambers, 1 Portsoken Street, London E1 8HZ, England ( BTPSTL ) would like to make the following notifications regarding the holding of voting rights held in P&I Personal & Informatik AG (the Company ) according to 21, 22 para. 1 WpHG in the name of BTPSTL and its subsidiaries - BriTel Fund Nominees Limited Lloyds Chambers, 1 Portsoken Street, London E1 8HZ, England ( BFNL ), - BriTel Fund Trustees Limited, Lloyds Chambers, 1 Portsoken Street, London E1 8HZ, England ( BFTL ), - Hermes Fund Managers Limited, Lloyds Chambers, 1 Portsoken Street, London E1 8HZ, England ( HFML ), und - Hermes Investment Management Limited, Lloyds Chambers, 1 Portsoken Street, London E1 8HZ, England ( HIML ), 1. On 12 June 2009 the voting interest held by BTPSTL in the Company fell below the 3% threshold of 21 para. 1 WpHG and amounted to 0% voting rights (i.e. 0 shares with voting rights) on this day. 2. On 12 June 2009 the voting interest held by BFNL in the Company fell below the 3% threshold of 21 para. 1 WpHG and amounted to 0% voting rights (i.e. 0 shares with voting rights) on this day. 3. On 12 June 2009 the voting interest held by BFTL in the Company fell below the 3% threshold of 21 para. 1 WpHG and amounted to 0% voting rights (i.e. 0 shares with voting rights) on this day. 4. On 12 June 2009 the voting interest held by HFML in the Company fell below the 3% threshold of 21 para. 1 WpHG and amounted to 0% voting rights (i.e. 0 shares with voting 5. On 12 June 2009 the voting interest held by HIML in the Company fell below the 3% threshold of 21 para. 1 WpHG and amounted to 0% voting rights (i.e. 0 shares with voting rights) at this day. 22