1 st quarterly report of SinnerSchrader Aktiengesellschaft Q12001/2002. INTERACTIVATE your business

Transcription

1 1 st quarterly report of SinnerSchrader Aktiengesellschaft Q12001/2002 INTERACTIVATE your business

2 Sales 6% UP ON PREVIOUS QUARTER Against the background of a difficult market environment, the first quarter of 2001/2002 shows sales of apple4.9 million. Projects SINNERSCHRADER CUSTOMERS ARE SUCCESSFUL SinnerSchrader customers maxblue and Tchibo are among the most successful ecommerce sites. Within a few weeks of its site s online launch, maxblue gained 100,000 new contract customers. Tchibo.de achieved 3rd place among the widest-coverage ecommerce sites in Christmas business Strategy CONCENTRATION ON THE MAIN MARKET, GERMANY The business activities in London and Rotterdam were discontinued on 31 August and 30 November The office in Denver/USA was closed on 31 December Key Figures of the SinnerSchrader Group * Revenues in Tapple 4,908 5,747 4,323 thereof Project Services in % EBITDA in Tapple EBITA in Tapple , Net income/loss for the period in Tapple Net income/loss per share for the period (diluted) in apple Cashflow from operating activities in Tapple Employees full time equivalents Liquid funds and marketable securities in Tapple 29,037 29,283 Shareholders equity in Tapple 48,611 43,610 * Employees pro-forma, unter end Konsolidierung of period der Netmatic ab * pro-forma assuming consolidation of Netmatic as of

3 THE MANAGEMENT BOARD Oliver Sinner, Matthias Schrader, Detlef Wichmann and Thomas Dyckhoff Dear Shareholders, In the first quarter of the business year 2001/2002, SinnerSchrader Aktiengesellschaft achieved a turnover of apple4.9 million. Revenues were therefore a good 6 per cent above the figure for the last quarter (4th quarter 2000/2001: apple4.6 million). In view of the continuing delay in the recovery of the economic environment and the Internet industry in particular, the stable development of sales is a positive indication of how attractive our services are. At the start of 2002, SinnerSchrader is one of the largest established ebusiness developers in Germany. However, the level of turnover in the first quarter is still almost 15 % below the previous-year quarter; the quarter showed a turnover of apple5.6 million on a pro-forma basis, i.e. assuming consolidation of Netmatic from 1 September It was primarily the established customers that formed the backbone of project business in the quarter under review. Major customers such as Deutsche Bank, Tchibo and Viag Interkom awarded us orders for further projects. These largely involve further development of existing Web applications and the creation of new functions. For example, we prepared maxblue, the online broker of Deutsche Bank, for its launch on the Italian market. BMW Financial Services charged us with a conception project for the relaunch of the Internet, Intranet and Extranet. SinnerSchrader managed to win new customers in the form of the entertainment electronics company Saturn that belongs to Metro AG and Baur Versand. We anticipate follow-up orders from these companies. All in all, however, the development of the orders position in the latter months of 2001 has been restrained. We do not anticipate a sustained revival of the orders position until the second half of The EBITDA, at apple35,000 still shows a just positive level. The decline of close to apple300,000 in comparison with the previous quarter results in particular from continuing low utilisation of our capacities, which we have so far deliberately left unchanged. Comparison with the first quarter of the prior year, which showed an EBITDA of apple1.1 million, underlines the effects of the continuing market weakness. Measures for cost reduction, especially the suspension of business activities in London on 31 August 2001 and since then also in Rotterdam and Denver on 30 November and 31 December, and avoiding the burden of further debt allowances have had some compensating effect in the decline in operating profit. As a result of discontinuing the scheduled amortisation of goodwill, the net loss of apple- 0.3 million for the quarter on a pro-forma basis has improved in comparison with the prior year quarters. Whether there will be a need for a non-scheduled amortisation as a result of the relevant US-GAAP adjustments is currently being examined. The operational cash flow was once again positive in the first quarter of 2001/2002 so that the liquidity reserves at apple29.0 million remained almost as high as they were previously. In November 2001, SinnerSchrader was one of two companies in Germany accepted by Intel into its ebusiness partner programme. By successfully combining Internet solution competence and technical expertise, SinnerSchrader has developed an excellent position in Germany. We will concentrate on this market in the current business year. We have significantly expanded our sales force. However, in view of the fact that the orders position had been developing slower than expected, further measures will be needed on the cost side to achieve the targets for the current business year. Hamburg, January 2002 The Management Board 3

4 Consolidated balance sheets as of 30. November Assets in in Current assets Cash and cash equivalents 945,185 3,996,452 Short-term investments/marketable securities 28,092,173 25,286,422 Trade accounts receivable 5,839,721 4,361,090 Inventories* 9, ,678 Prepaid expenses and other current assets 2,221,710 2,237,691 Total current assets 37,107,850 36,348,332 Non current assets Property, plant and equipment 2,417,524 1,849,303 Intangible assets 494,553 1,241,076 Goodwill 14,581,574 13,894,398 Investments 4,107 4,107 Total non current assets 17,497,758 16,988,884 Total assets 54,605,608 53,337, Liabilities and shareholders equity Current liabilities Trade accounts payable in 1,160,178 in 695,464 Advance payments received Accrued expenses 2,467,905 2,149,766 Deferred revenues Purchase price liability 5,087,331 Deferred tax liability 412, ,836 Other current liabilities 1,953,599 1,360,484 Total current liabilities 5,994,391 9,726,881 Non current liabilities Minority interest Shareholders equity Share capital 11,542,764 10,412,246 Additional paid-in capital 37,355,960 33,399,147 Treasury stock Retained earnings/accumulated deficit - 150, ,864 Accumulated other comprehensive income/loss 369, ,558 Deferred compensation - 506, ,480 Total shareholders equity 48,611,216 43,610,335 Total liabilities and shareholders equity 54,605,608 53,337,216 * unbilled revenues 4

5 Consolidated statements of operations from 01 September until 30 November ST QUARTER 2001/2002 Revenues ) in in in Project Services 3,995,421 4,419,515 3,055,495 Media Services 674,383 1,196,305 1,196,305 Other 238, ,089 71,087 Total revenues, gross 4,908,259 5,746,909 4,322,887 Media costs - 498, , ,258 Total revenues, net 4,410,079 4,880,651 3,456,629 Cost of revenues - 3,199,379-2,587,245-1,811,326 Gross profit/loss 1,210,700 2,293,406 1,645,303 Selling and marketing expenses - 259,531 General and administrative expenses 2) - 1,043,753-1,253,696-1,050,603 Research and development expenses - 44,031-79,932-79,932 Other operating income and expenses Amortisation (and impairment) of Goodwill - 1,116,259 Amortisation of intangible assets - 59, ,582 Amortisation of deferred compensation - 124, ,802 Operating income/loss - 320, , ,768 Interest income and expenses 156,129 19,337 20,271 Income from investments and participations Other income/expense 25,643 44,867 29,137 Result before income tax (and minority interest) - 138, , ,176 Income tax - 188, , ,124 Extraordinary income/expense Minority interest Net income/loss - 327, , ,052 Net income per share (basic) Net income per share (diluted) Weighted average shares outstanding (basic) 11,542,764 11,542,764 9,975,000 Weighted average shares outstanding (diluted) 11,542,764 11,542,764 10,003,517 1) pro-forma assuming consolidation of Netmatic as of ) previous year included selling and marketing expenses 5

6 Consolidated statements of shareholders equity from 01 September until 30 November ST QUARTER 2001/2002 Number of shares Nominal value Additional paid-in, Deferred Retained Accumulated Total Comprehensive capital, net of compensation earnings other compre- shareholders income equity adjustment hensive income equity in in in in in in in Balance as of ,412,246 10,412,246 33,399, , , ,558 43,610,335 Net income/ loss - 327, , ,226 Unrealised gains on available-forsale securities, net tax 125, , ,389 Foreign currency translation adjustment, net of tax - 8,839-8,839-8,839 Common stock issued for acquisition of Netmatic 1,130,518 1,130,518 3,956,813 5,087,331 Amortisation of deferred compensation 124, ,226 Balance as of ,542,764 11,542,764 37,355, , , ,109 48,611, ,676 6

7 Consolidated statements of cash flows from 01 September until 30 November 2001 Cash flows from operating activities in in Net profit/loss - 327, ,053 Adjustments for Minority interest Depreciation and amortisation 329,921 69,756 Increase/decrease in provisions and accruals 318, ,713 Losses/gains on the disposal of fixed assets - 14, Foreign exchange gains/losses - 11,439 Others - 189,980-9,970 Change in net working capital 52,793-1,110,443 Net cash provided by (used in) operating activities 157,614-1,760,515 Cash flows from investing activities Acquisition of subsidiaries, net cash acquired Proceeds from disposal of a subsidiary, net cash transferred Purchase of investments - 206,027 Purchase of short term investments - 10,901,035 Proceeds from sale of short term investments 8,389,526 2,570,578 Purchase of property, plant and equipment - 714, ,279 Proceeds from sale of equipment 19,491 3,771 Net cash used in investing activities - 3,206,588 2,148,043 Cash flows from financing activities Proceeds from issuance of share capital Proceeds from short or long-term borrowings Payment of capital lease liabilities Net cash provided by (used in) financing acitivities Net effect of currency translation in cash and cash equivalents - 2, Net increase/decrease in cash and cash equivalents - 3,051, ,448 Cash and cash equivalents at beginning of period 3,996, ,983 Cash and cash equivalents at end of period 945, ,431 Supplemental disclosures of non-cash financing activities Common stock issued for acquisition of Netmatic 5,087,331 7

8 Management discussion and notes to the structured quarterly report I. General II. Management discussion The quarterly report of the SinnerSchrader Group ( SinnerSchrader, Group ) is prepared in accordance with US accounting principles ( US GAAP ) and takes account of the instructions of Accounting Principle Board Opinion (APB) No. 28 and the rules for Structured Quarterly Reporting of the Deutsche Börse AG for the Neuer Markt. It should be read in conjunction with the consolidated financial statements of Sinner- Schrader Aktiengesellschaft as on 31 August In addition to SinnerSchrader Aktiengesellschaft ( SinnerSchrader AG ), the consolidated accounts cover SinnerSchrader Deutschland GmbH, SinnerSchrader UK Limited, SinnerSchrader Benelux BV and Netmatic Inc. SinnerSchrader Deutschland GmbH was created from the merger of the German domestic subsidiaries of SinnerSchrader AG, SinnerSchrader Interactive Marketing GmbH, SinnerSchrader Interactive Software GmbH and SinnerSchrader Netmatic GmbH, with retrospective effect as of 1 January In the comparable quarter of the prior year (1 Sept Nov 2000), SinnerSchrader Netmatic GmbH and Netmatic Inc. were not yet consolidated as part of the Group. For clearer illustration of development compared to the prior year, we have therefore additionally presented the proforma figures for the first quarter of 2000/2001 including the companies of the Netmatic Group. This quarterly report was prepared on the basis of the same accounting rules and valuation methods as used for the consolidated financial statements as on 31 August 2001, with the exception of the adoption of Statement of Financial Accounting Standard (SFAS) No. 141 Business Combinations and No. 142 Goodwill and Other Intangible Assets issued in June 2001 by the Financial Standards and Accounting Board (FASB). SFAS No. 141 and SFAS No. 142 establish new rules for the treatment of intangible assets and goodwill. They must be applied to all business years starting after 15 December Companies whose business year differs from the calendar year can, however, adopt the new rules already to business years that started after 15 March SinnerSchrader, whose business year 2001/2002 started on 1 September 2001, decided on early adoption of the new rules and started to implement these in the first quarter. The effects of application of the new rules on this quarterly report are explained in greater detail in section III Sales development The first quarter of the business year 2001/2002 from 1 September 2001 to 30 November 2001 occurred at a time of further weakening of economic activity in all of the important industrial countries, especially in Germany, the principal market for SinnerSchrader. The terrorist attacks of 11 September 2001 in the USA meant a considerable additional burden on the investment climate and consequently on overall economic development. Q I 2001/2002 Q IV 2001/2002 in 000s pro-forma in 000s Project Services 3,995 4,081 Media Services Other Total revenues, gross 4,908 4,614 Media costs Total revenues, net 4,410 4,325 In this environment, SinnerSchrader achieved with apple4.9 m a gross turnover that was a good 6 % above the level of the previous quarter. Re-growth in the media services business which has a seasonal peak before Christmas and intensified operational services for ebusiness solutions helped to support growth. In project services, there was a slight decline in comparison to the previous quarter. This can be attributed to the fact that SinnerSchrader suspended operations in the UK and the Netherlands for the time being and the serious effects of the terrorist attacks on the subsidiary in the USA. At home, project services turnover was slightly above that of the prior quarter. Q I 2001/2002 Q I 2001/2002 in 000s pro-forma in 000s Project Services 3,995 4,419 Media Services 674 1,196 Other Total revenues, gross 4,908 5,746 Media costs Total revenues, net 4,410 4,880 8

9 The comparison to the first quarter of the prior year highlights once again the extent to which the overall weakness in economic activity, on the one hand, and the bursting of the Internet bubble on the other have affected the development of turnover at SinnerSchrader. With a decline of almost 45 %, media services were the most seriously affected as a result of the crisis in online advertising. However, the company also had to absorb a decline of close to 10 % in project service business. Spread over the sector-oriented SinnerSchrader Solution Centres, turnover in the first quarter of 2001/2002 was distributed as follows: 51% FINANCIAL SERVICES The trend in the business year 2000/2001 with the growing importance of the financial services sector was also maintained in the first quarter of the new business year. Around 50 % of sales were achieved in this Solution Centre. In the Travel & Transportation sector, a number of projects were suspended as a result of the events of 11 September 2001 and the high degree of uncertainty concerning the effects of these events on consumer behaviour have resulted in spending restraint among retailers and mail order companies in the latter months of Project successes 0.5 % OTHERS 12 % RETAIL & CONSUMER GOODS 14.5 % MEDIA & ENTERTAINMENT 2 % TRAVEL & TRANSPORTATION 20 % COMMUNICATION & TECHNOLOGY Accordingly, the principal project successes were in business with financial service providers. For maxblue, the online broker of Deutsche Bank AG, SinnerSchrader was in charge of the launch of maxblue in Italy in the first quarter of 2001/2002 following its successful launch in Germany in early SinnerSchrader thus has a part in realising the internationalisation strategy of the multiple awardwinning investor portal. maxblue aims in the medium term to become the leading online broker in Europe. SinnerSchrader launched a new online form centre on behalf of the German securities specialist DWS. DWS customers can now complete applications to open accounts on the Internet. Anyone wishing to calculate their Riester pension can do this on the DWS website. The pension support calculator developed by Sinner- Schrader also presents to the potential customer the DWS products appropriate to their needs. We also succeeded in realising interesting ebusiness projects for existing and new customers in the area of retail. To further speed up the expansion of the Tchibo presence on the Internet, Tchibo has launched a further online branch for Switzerland with the support of SinnerSchrader. This means that besides 850 branches and around 38,000 so-called depots in specialised and grocery retailing, the company s sales chain now includes three online branches developed by SinnerSchrader in Germany, Austria and Switzerland. Tchibo Holding anticipates a turnover of well over apple100 million from the online business for For new customer RefLine AG, a supplier of systems for job application management in companies, the Internet platform was ported to a new technology and further developed in terms of features. SinnerSchrader has thus developed a multilingual job application management system with individually adaptable user interfaces and Internet-based management and editing functions for the document flow in job application management processes. The relaunch took place in October; SinnerSchrader is busy completing further follow-up orders through to April Order and price development All in all, the order flow received in the first quarter of 2001/2002 was slow. The restraint in decision-makers tended to increase rather than decrease in the latter months of the year compared to mid-year. In addition, project orders were increasingly awarded in stages. Significant new orders primarily came from existing customers. 9

10 All the more pleasing that Metro AG has commissioned SinnerSchrader to develop a new website for the entertainment electronics chain Saturn. The company aims to use the Internet for the first time as an integrated customer loyalty and sales platform for over 70 regional Saturn markets. The site is destined to go online in the first half of the year The project work started in December On the price side, too, there were still no signs of easing in the last months of 2001/2002 since many customers, in the face of restrained economic prospects, are forced to implement cost-saving measures. 4. Development of costs and revenues Q I Q IV Q I 2001/ /2002* 2001/200* in 000s in 000s in 000s Gross profit 1,211 1,188 2,293 EBITDA ,104 EBITA ,005 Net income / loss *pro-forma The EBITDA for the SinnerSchrader Group in the first quarter of 2001/2002 was, at apple35,000, just into the positive and thus around apple0.3 million below the level of the fourth quarter and apple1.1 million below the level of the first quarter of the previous year. The profit situation therefore remains unsatisfactory. The basic reason for this is the unchanged, low utilisation of capacity. When releasing the 2000/2001 annual accounts and in anticipation of a business revival in the first half of 2002, we declared our belief in a policy of refraining from adjusting capacity for the sake of shortterm profit considerations. The average number of employees on a full-time equivalent basis in the first quarter, was accordingly only 2 employees below the level of the previous quarter. In the first quarter of the previous year, the comparable figure was around Moreover, after acquisition of the new office building in Hamburg, higher rental costs were incurred that are also attributable to the reserves of office space that now exist. As a result, the gross margin in the first quarter, at 24.7 %, was once again slightly lower than in the prior year (25.8 %) and significantly poorer than the comparable figure for the prior year (39.9 %). Foreign activities still show a negative result of around apple0.1 million. This is, admittedly, below the loss of the previous quarter, but still in the order of magnitude of the prior year. Having already suspended operational activities in the UK at the end of August, we abandoned our activities in the Netherlands at the end of the first quarter. At the end of December, we also cancelled business in the USA. As anticipated, there was no need for additional bad debt allowances in the first quarter of 2001/2002. The net profit for the period is, at apple- 0.3 million, significantly above the pro-forma figures of the comparative quarters. This can be attributed to the fact that, after the change of accounting principles, the goodwill from the acquisition of Netmatic is no longer subject to a scheduled amortisation. When the new accounting principles are applied for the first time, however, a so-called impairment test for the goodwill must be carried out by the end of the second quarter, as a result of which an extraordinary write-down may be necessary (cf. III.2). The financial result in the quarter was close to apple0.2 million; additionally unrealised profits accumulated in the money market funds amounting to apple0.7 million are shown in the corresponding equity item. 5. Research and development activities Expenditure for research and development in the quarter was around apple44,000 and thus well below the previous quarters. The principal activities in this area were the development and support of SinnerSchrader s own software frameworks, object libraries and reusable components. As a result of the continuing good and technically highly-qualified collaboration between Intel Deutschland and SinnerSchrader in the area of performance tests for high-performance Internet-based system architectures, in November 2001 Intel Deutschland provided considerable support for the setting up of an ebusiness solution lab at Sinner- Schrader. As a result, one of only two labs of this kind in Germany is at SinnerSchrader s disposal, at which efficient system architectures can be pre-developed and tested. 10

11 6. Investments In the first quarter of 2001/2002, SinnerSchrader invested around apple0.7 million in fixed assets (including software). This comparatively high level of investment is still connected with the fitting-out and conversion of the new office building in Hamburg, which Sinner- Schrader moved into in the first month of the reporting period. 7. Cash flow, liquid funds and securities The operational cash flow was, at apple0.2 million, slightly positive in the first quarter of the current business year with barely changed working capital. Together with the unrealised gains accumulated in the money market funds, it was possible to partially compensate the high level of investment. Consequently, at apple29.0 million, the liquid funds and securities as on 30 November 2001 were only apple0.3 million below the level at 31 August The funds are, as before, invested solely in fixed-term deposits, money market funds and money market-oriented funds. 9. Employees The number of employees in the first quarter changed only slightly in comparison with the previous quarter. On a full-time equivalent basis, an average of employees were employed in the quarter under review, a good 2 employees less than in the previous quarter and around 32 employees more than in the prior year s quarter. The closing level of the employee number as of 30 November 2001 was, at 261 employees, 2 above the closing level of the previous quarter. Within the employee structure, we have made a slight shift towards consulting with the purpose of strengthening the sales efforts of SinnerSchrader. Employees by function end of the month Consulting Experience Design Engineering Business Management Services Company Services Total Balance sheet The principal changes in the balance sheet are once again connected with the acquisition of Netmatic. In October 2001, the Board of Management decided, with the approval of the Supervisory Board, to put through the capital increase for the second purchase price instalment arising from the Netmatic acquisition. The capital increase was entered in the Commercial Register on 19 November 2001, so the company was able to settle the purchase price liability shown in the balance sheet as on 31 August 2001 by creation of the appropriate equity capital. The number of outstanding shares as of 30 November 2001 thus increased to 11,542,764. All shares issued in the course of the acquisition of Netmatic were admitted for trading by the Deutsche Börse as of 2 January In connection with the level of the second purchase price instalment and the timing of the settlement, the sellers of Netmatic have in November made an application for arbitration proceedings as provided for in the contract of sale, which has not yet been completed. The amount in dispute is apple0.5 million. 10. Outlook The first quarter of 2001/2002 largely followed our expectations. In terms of reaching our targets for the year as a whole sales growth and improvement in profitability in comparison to the business year 2000/2001 however, the crucial factor is the speed of recovery of investment confidence based on positive economic prospects. In the past few weeks, there have been indications that the economic recovery in Germany will take longer despite the positive trend in the USA. Orders received at SinnerSchrader have so far developed below plan in the current business year. By focusing exclusively on the German market, and through further expansion of our sales efforts, we believe that we can achieve our targets for the current year. More then in the past, we will, however, have to keep an eye on adjusting our capacities in line with order development. 11

12 III. Additional Notes 1. Segmental reporting With its business model SinnerSchrader operates in only one segment. In the regional breakdown of turnover, sales are apportioned to those countries from which the sales were transacted. In the first quarter of 2001/2002, almost the entire turnover of SinnerSchrader was accordingly apportioned to the home country. However, sales were also achieved in the USA in this quarter. 2. Adoption of accounting standards SFAS No. 141 and SFAS No. 142 SinnerSchrader adopted the new accounting standards SFAS No. 141 Business Combinations - and SFAS No. 142 Goodwill and Other Intangible Assets ahead of the requirement as of the beginning of the business year 2001/2002 on 1 September The changeover to accounting standard SFAS No. 141 requires examination of intangible assets identified in the course of the purchase price allocation for the acquisition of Netmatic Internet/Intranet Solutions GmbH. Under the new rules, an assembled workforce is no longer considered to be an intangible asset. The book value of apple687,176 of the assembled workforce at the adoption date was accordingly added to goodwill. Furthermore, through the application of the new guidelines, the identification of intangible assets in the course of the purchase price allocation was checked for possible further intangible assets that are required to be shown outside of goodwill. No further intangible assets were ascertained through the examination. According to the rules for the changeover to the new standard SFAS No. 142, SinnerSchrader suspended the scheduled amortisations of goodwill in the first quarter of the business year 2001/2002. Scheduled amortisations of goodwill make way for an impairment test carried out annually or as a result of triggering events that results, if relevant, in a corresponding write-down of goodwill to the lower fair value ascertained in the course of the impairment test. An impairment test must be carried out for the first time as on the date of the adoption of the new accounting rules. If necessary, write-downs required after this initial impairment test are to be shown as cumulative effects from the application of new accounting principles net of possible tax effects separately outside the operating result. The impairment test relates in each case to reporting units to which a part of the overall book value of the goodwill is to be allocated. The impairment test is carried out in two steps. In the first step, a fair value must be ascertained for the respective reporting unit. If this fair value exceeds the book value of the net assets of the reporting unit, the need for a write-down of the goodwill does not arise. If the fair value of the reporting unit is below the book value, the fair value must in the second step be distributed among the reported assets and liabilities as well as any identifiable, unreported intangible assets excluding goodwill. If the remaining fair value ( implied fair value of goodwill ) is below the book value of the goodwill, a non-scheduled amortisation must be carried out. According to SFAS No. 142, calculation of the fair value of a reporting unit must be performed on the basis of either a market value or the present value of the expected cash flow to be generated in the future by the reporting unit. The transition rules of SFAS No. 142 provide that the first step of the initial impairment test must be completed by the end of the second quarter following the date of adoption. At the date of adoption, SinnerSchrader considers itself to consist of just one reporting unit that conclusively corresponds to the total SinnerSchrader Group. SinnerSchrader is currently working on the completion of the first step of the initial impairment test; presumably the second step will also be necessary. 12

13 The estimated useful lives of the identified intangible assets also have to be examined upon transition to SFAS No No assets with indeterminable asset life were ascertained during this examination. The estimation for the useful lives of intangible assets with determinable asset lives were examined. For the customer list the examination resulted in a reduction of the remaining useful life from 52 to 28 months as of the date of adoption. The following table shows the prior year comparison of the net profit/loss for the period, corrected by the effect arising from the adjustments to be made under SFAS No Q I 2001/2002 Q I 2000/2001 Q I 2000/2001 in 000s in 000s pro forma in 000s Net profit/loss for the period - 327, , ,716 Add-back of amortisation and goodwill 1,116,260 Add-back of amortisation on assembled work force 73,626 Adjustment of amortisation on customer list - 27,391 Adjusted net profit/loss for the period - 327, , ,779 Q I 2001/2002 Q I 2000/2001 Q I 2000/2001 in 000s in 000s pro forma in 000s Net profit/loss per share for the period* Add-back of amortisation and goodwill 0.09 Add-back of amortisation on assembled workforce 0.01 Adjustment of amortisation on customer list Adjusted net profit/loss per share for the period* * diluted 3. Changes in shareholder s equity On 18 October 2001, the Management Board, with the approval of the Supervisory Board, increased the capital by apple1,130,518 issuing new no-par-value bearer shares by partial utilisation of authorised capital. The shares served settlement of the purchase price liability resulting from the acquisition of Netmatic Internet/Intranet Solutions GmbH. The authorised capital was thus reduced to a sum of apple3,082,236 as of 30 November Own shares As of 30 November 2001, SinnerSchrader did not hold any shares of its own. In the period 1 September 2001 to 30 November 2001, the company neither bought nor sold its own shares. 13

14 5. Subscription rights of board members and employees With shareholder resolutions in October 1999 and in December 2000, SinnerSchrader AG established the SinnerSchrader 1999 stock option plan and the Sinner- Schrader 2000 stock option 2000 plan, and the required conditional capital of apple375,000, respectively for this. Detailed information on the option plans is given in the notes to the consolidated financial statements of 31 August The table below gives the number of option rights issued under the two option programmes, the change in the first quarter 2001/2002 and the weighted average exercise price of the granted option rights. STOCK OPTION PLAN 1999 STOCK OPTION PLAN 2000 Number of Weighted Number of Weighted options granted average options granted average exercise price exercise price in in Outstanding at 31 August , Granted 77, , Exercised Cancelled - 29, Outstanding at 30 November , , As of 30 November 2001, no option rights were allocated to the members of the Management Board and the Supervisory Board. 6. Directors holdings of shares and subscription rights to shares The following table shows the number of shares in SinnerSchrader AG held by Board members of Sinner- Schrader AG and the changes during the reported period from 1 September to 30 November Shares Management Board Members: Oliver Sinner ,347,000 Additions Disposals ,347,000 Matthias Schrader 2,137,675 2,137,675 Detlef Wichmann 323, ,100 Thomas Dyckhoff 49,950 49,950 Supervisory Board Members: Dr. Markus Conrad 187,500 10, ,500 Fritz Seikowsky 4,000 4,000 Reinhard Pöllath Total 5,049,225 10,000 5,039,225 On 30 November 2001, the members of the Management Board and the Supervisory Board did not hold any options on shares in SinnerSchrader AG. In the period under review, no additions or disposals of such options occurred. 14

15 Financial Calendar HALF-YEAR REPORT September February 2002 April 2002 NINE-MONTH REPORT September May 2002 July 2002 ANNUAL REPORT 2001/2002 November 2002 Contact HAMBURG SinnerSchrader Aktiengesellschaft Gasstraße Hamburg Germany Phone: +49 (0) Fax: +49 (0) info@sinnerschrader.com Investor Relations Julia Kretschmann Phone: +49 (0) Fax: +49 (0) ir@sinnerschrader.com FRANKFURT SinnerSchrader Aktiengesellschaft Mainzer Landstraße Frankfurt/Main Germany Phone: +49 (0) Fax: +49 (0) info@sinnerschrader.com