GFT Interim Financial Report as of 30 June 2011 by GFT Technologies SE

Interim financial report as of 30 June 2011

Q1–2—2011

Key figures according to IFRS

Continued operations

Half-year

01/01/– 30/06/2011

01/01/– 30/06/2010

Change

Income Statement Revenue

€m

141.80

114.68

23.6%

Earnings before interest, taxes, depreciation and amortisation (EBITDA)

€m

5.76

4.93

16.8%

Earnings before interest and taxes (EBIT)

€m

5.13

4.36

17.7%

Earnings before taxes (EBT)

€m

5.52

4.65

18.7%

Net income as of 30 June from continued operations

€m

3.63

3.55

2.3%

Other non-current assets

€m

35.59

29.71

19.8%

Cash, cash equivalents and securities

€m

18.09

26.44

-31.6%

Other current assets

€m

81.41

59.08

37.8%

ASSETS

€m

135.09

115.23

17.2%

Non-current liabilities

€m

2.28

2.26

0.9%

Current liabilities

€m

61.64

46.36

33.0%

Shareholders´ equity

€m

71.17

66.61

6.8%

SHAREHOLDERS' EQUITY AND LIABILITIES

€m

135.09

115.23

17.2%

Equity ratio

Balance Sheet

Cash flow Cash flow from operating activities

€m

-11.62

-8.59

35.3%

Cash flow from investing activities

€m

-0.84

-11.08

-92.4%

Cash flow from financing activities

€m

-3.54

-2.23

58.7%

1,317

1,209

8.9%

0.14

0.13

2.3%

Employees Number of permanent employees (as of 30 June)

Share Earnings per share acc. to IAS 33

€

(Rounding differences in the Consolidated Interim Management Report due to presentation in € million possible.)

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❘

Highlights

The GFT Group continued its positive start to the year in the second quarter and ended the first six months of 2011 with new record levels of both revenue and pre-tax earnings (EBT). The Executive Board therefore confirms its forecast for the current year made in the Consolidated Financial Statements 2010 and expects total revenue of €275 million and earnings before taxes of €13 million in fiscal year 2011.

Revenue

€ million

Earnings before taxes

2010

2011

69.52

64.06

60.25

74.50

54.43

67.30

248.26

141.80

2010

€ million

2.79

4.11

3.02

3.50

1.63

2.02

11.55

5.52

Contents Consolidated Interim Management Report Notes to the Interim Financial Statements

… …

2 23

2011

Consolidated Interim Financial Statements

…

Q1–2—2011

Consolidated Interim Management Report of GFT Technologies AG as of 30 June 2011

Business environment Economic environment Macroeconomic development

In its latest report, the IMF upgraded its forecast for Germany. Following strong growth in the first six months, the German economy is now expected to grow by 3.2%

Following a dynamic economic recovery which still dom

in 2011 as a whole. This represents a considerable increase

inated the first quarter of 2011, there were growing signs

of 0.7 %-points over the IMF’s April report, which had

in the second quarter that the global upturn was beginning

assumed growth of 2.5%. The positive trend in Germany

to lose momentum. In addition to weaker US indicators,

is largely due to the strong order position enjoyed by the

a more modest outlook for China and high energy costs,

country’s manufacturers: demand for German industrial

this was mainly due to the problems surrounding the high

products remained favourable in the second quarter.

sovereign debt of certain nations. The massive state deficits of the USA and Japan – the latter largely due to the consequences of the devastating earthquake and tsunami – and developments in the Euro zone gave cause for concern. According to the International Monetary Fund (IMF), the huge debts of Greece, Ireland and Portugal not only represent a danger for the Euro zone but for the whole global economy. In their report published in June 2011, the IMF’s experts reported increased risks and a slight slowdown in the economic recovery. After reaching 5.1% in the previous year, the global economy is expected to grow by 4.3% in 2011. In April 2011, the IMF had forecast growth of 4.4%. Despite the debt problems of several nations, the IMF expects the Euro zone to achieve further growth and fore casts a rise in GDP of 2.0% for 2011. The IMF has thus upgraded its April forecast – in which growth was expected to reach 1.6%. European growth is mainly being driven by high capital spending in Germany and France. With regard to Greece’s sovereign debt problem, the IMF noted the concerns of many investors that the Greek government was incapable of taking the necessary steps to avert the country’s insolvency. Experts also warned against the possibility of the crisis spreading to other states.

Sector development According to the latest economic survey of the German Federal Association for Information Technology, Telecommunications and New Media (BITKOM) in July 2011, Germany’s Information and Communication Technology (ICT) sector is still very upbeat. Two thirds of German high-tech companies surveyed expect second-quarter revenues to be up on the same period last year. For 2011 as a whole, 74% of Germany’s ICT companies forecast growth in sales. In spring, the proportion was still 90%. BITKOM states that these positive sales expectations are to be found in all segments of the ICT industry. IT service companies are particularly optimistic: 82% of companies forecast revenue growth for the current 2011 fiscal year. Companies are benefiting above all from the rising demand for Cloud Computing solutions. However, 59% of companies surveyed thought that the current lack of skilled IT workers was the greatest obstacle to growth. The sector association upheld its positive assessment of the German IT market and continues to forecast market volume of €68.8 billion. This represents year-on-year growth of 4.3%. For the IT Services market, BITKOM expects growth of 3.5% to €34.2 billion.

➜

Course of business in the first six months of 2011 The GFT Group benefited from the macroeconomic recovery and continued its positive start to the year in the second quarter. The Group ended the first six months of 2011 with new record levels of both revenue and pre-tax earnings (EBT). Revenue grew year on year by 24% to €141.80 million (prev. year: €114.68 million). At €5.52 million, EBT exceeded the prior-year figure by 19% (prev. year: €4.65 million). The GFT Group enjoyed a successful second quarter with a further acceleration in the pace of growth. After reaching €67.30 million in the first quarter, the Group generated revenue of €74.50 million in the second quarter (prev. year: €60.25 million). EBT in the second quarter amounted to €3.50 million (prev. year: €3.02 million); in the first

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Interim Management Report

€4.56 million, corresponding to year-on-year growth of 14% (prev. year: €4.01 million). The Resourcing division posted segment earnings of €1.65 million, compared to €0.86 million in the same period last year – an increase of 93%. Earnings for the first six months also consider nonallocated expenditure of the Group’s headquarters, including ancillary purchase costs for acquisitions, amounting to €0.69 million. By acquiring the Swiss-based Asymo AG on 9 June 2011, the GFT Group has expanded its portfolio of services with the addition of top-quality consulting expertise for the core banking solution Avaloq and widened its customer base in Switzerland. The figures presented in this report include revenue of €0.58 million contributed by Asymo AG for the month of June. As a result of investment and integration costs, the newly acquired company did not make any

quarter it had reached €2.02 million.

significant contribution to earnings in this period.

The positive development of revenue in the first half of

The Software segment was sold as scheduled in May 2010

2011 is largely due to a strong increase in segment revenue in the Resourcing division, which posted year-on-year growth of 43% to reach €83.54 million (prev. year: €58.44 million). The segment was able to exploit the ongoing recovery of the industrial sector and raised revenue across all its national markets. Growth was particularly strong in France and Germany. In addition to revenue growth achieved with existing clients, growth was also boosted by new client acquisitions. Despite challenging conditions in the financial sector, the Services division succeeded in raising segment revenue year on year by 4% to €58.26 million (prev. year: €56.21 million), thus enhancing slightly the high revenue level it had already achieved. Growth in this segment can be mainly attributed to demand for outsourcing services and higher revenues in the corporate and investment banking sector. As a result of increased revenue and successful measures for raising productivity, the GFT Group was able to raise earnings before taxes by 19%. In the first six months of 2011, EBT reached €5.52 million (prev. year: €4.65 million). The Services division once again made the largest contribution to total earnings with a segment result of

and is no longer included in the GFT Group’s key financial figures for financial year 2010. The prior-year figures refer exclusively to the continued business divisions Resourcing and Services. Against the backdrop of strong demand in all sectors for IT specialists, the GFT Group expects to continue its positive development of the first two quarters in the second half of the year. A significant boost to growth is expected from the industrial sector, which is likely to display a growing need for freelance IT specialists and engineers. This demand will add further impetus to growth in the Resourcing division in the months ahead. The Services division will continue to face adverse conditions in its market environment. In view of recent developments on the financial markets, the Executive Board expects the segment to continue its moderate growth in the second half of the year. The Executive Board therefore confirms its forecast for 2011 as a whole which it made in the Consolidated Financial Statements 2010 and expects total revenue of €275 million and earnings before taxes of €13 million for fiscal year 2011.

Q1–2—2011

GFT share Following a positive start to the trading year and a volatile

growth was slowing. The IMF, for example, downgraded

first quarter, the beginning of the second quarter was

its forecast slightly for global economic growth in the

dominated by the catastrophe in Japan, which caused

current year from 4.4% to 4.3% in its June report. At the

share prices to slide around the world. The consequence

end of the reporting period, stock markets were caught

was an abrupt change in the market mood: despite strong

between positive company data and numerous risk fac-

company earnings and encouraging quarterly reports, a

tors. Following a volatile performance over the first half

feeling of uncertainty began to spread and the German

of 2011, the DAX closed at 7,376 points on 30 June 2011

blue-chip DAX index reverted to a phase of further con-

and was thus 7% up on its year-opening level. Similar to

solidation. Although markets began to pick up again in

the DAX, Germany’s tech stocks also fluctuated strongly

the following weeks, investors remained cautious in view

during the period under review. The Tec-DAX index rose

of various risk factors such as Europe’s debt crisis, inflation

5% in the first six months of 2011 to close at 894 points

fears and increased oil prices. By the end of the second

on 30 June 2011.

quarter, the Greek sovereign debt problem was dominating market trading. There were also increasing signs that

Share price performance in Euro (Xetra)

GFT share 5.00

200

4.50

150

4.00

100

3.50

50 Trading volume in thousand

3.00

3 January 2011 €4.33

Indexed share price performance (Xetra)

30 June 2011 €3.96

GFT share

Technology All Share Performance Index 120

100

3 January 2011 €4.33 = 100%

30 June 2011 €3.96

➜

The GFT share was unable to escape these market fluc

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Interim Management Report

Shareholder structure (%)

tuations over the course of the first six months. After a strong start to the year and a volatile first quarter, the share began the second quarter modestly. Despite adverse market conditions, however, the share climbed 7% to €4.38 in April 2011. In line with stock exchange losses across the board, the GFT share subsequently dipped before finishing the period at €3.96 on 30 June 2011 – corresponding to a decline of 9% over the year so far. Analysts at Landesbank Baden-Württemberg (LBBW) continue to uphold their “buy” recommendation for the GFT share with an upside target of €5.00. After publication of our interim report as at 31 March 2011, the analysts of Warburg Research GmbH raised their upside target from €5.30 to €5.60 and also maintained this value after the acquisition of Asymo AG. They also upheld their “buy” recommendation. The analysts of equinet Bank AG also advise investors to “buy” the GFT share; following the Asymo acquisition, they upheld their upside target of €5.10 – which had been downgraded after publication of the first quarter figures. The Annual General Meeting of GFT AG was held on 31 May 2011 in Stuttgart and attended by 61% of voting capital. All items on the agenda were adopted with large majorities. According to a resolution adopted by the Annual General Meeting, the dividend of €0.15 per share proposed by the Executive Board and Supervisory Board was distributed on 1 June 2011.

Shareholder structure The shareholder structure of GFT Technologies AG remained stable in the first six months of 2011: company founder Ulrich Dietz continues to hold 28.46% of shares. Maria Dietz owns 9.68% of shares. Dr. Markus Kerber, a former member of GFT’s Supervisory Board, holds 5% of voting rights. The free float amounts to 56.86%.

Ulrich Dietz

28.46

Maria Dietz

9.68

Dr. Markus Kerber Free float

5.00 56.86

Q1–2—2011

Information on the GFT share Q1–2 2011

Q1–2 2010

Year-opening quotation (Xetra)*

€4.33

€2.45

Closing quotation on 30 June (Xetra)*

€3.96

€3.10

Percentage change since year-opening

-9%

+27%

Highest price (Xetra)*

€4.86 (18/01/2011)

€3.74 (15/03/2010)

Lowest price (Xetra)*

€3.59 (13/06/2011)

€2.33 (04/01/2010)

€104.25 million

€81.61 million

€0.14

€0.13

38,516

56,373

Market capitalisation as of 30 June Earnings per share from continued operations Average daily trading volume in shares (Xetra and Frankfurt)* * daily closing prices

ISIN

DE 0005800601

Market segment

Prime Standard

Designated sponsors

Landesbank Baden-Württemberg (LBBW) equinet Bank AG

Number of no-par value shares

26,325,946

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Interim Management Report

Development of revenue The GFT Group generated revenue of €141.80 million in

In the period under review, the Resourcing segment gen-

the first six months of 2011 and thus exceeded the prior-

erated revenue of €83.54 million and thus achieved strong

year level by 24% (prev. year: €114.68 million). Revenue

year-on-year growth of 43% (prev. year: €58.44 million).

in the second quarter amounted to €74.50 million and

Increased demand for freelance IT specialists across all

was thus up strongly on the first-quarter figure of €67.30

countries and sectors benefited the segment’s Resource

million. The Resourcing division made a particularly strong

Management business in particular, which recorded

contribution to this overall development with segment

growth of 49% to €42.40 million (prev. year: €28.44 mil-

revenue of €83.54 million, representing year-on-year

lion). Third Party Management contributed €41.14 million

growth of 43% (prev. year: €58.44 million). The Services

to total segment revenue (prev. year: €30.00 million),

division reported slight growth to €58.26 million (prev.

representing growth of 37%.

year: €56.21 million).

The Services division succeeded in building on the high

Revenue by segment

revenue level of the previous year. Consistently high de-

The particularly strong development of the Resourcing

to €58.26 million (prev. year: €56.21 million). In addition

division is also reflected in the breakdown of revenue by segment: following a share of total revenue of 51% in the previous year, the Resourcing segment grew by 8 %-points to 59% in the period under review. This proportion is

mand from the financial sector helped raise revenue by 4% to outsourcing services in Spain, demand was particularly strong for IT solutions from corporate and investment banking clients in the UK and USA.

shared almost equally by the business fields Resource Management (30%; prev. year: 25%) and Third Party Management (29%; prev. year: 26%). The Services division’s share fell correspondingly to 41% (prev. year: 49%).

Revenue by segment

Revenue by country

Q1–2 2011

Resourcing Third Party Management Resource Management Services

Q1–2 2011

59%

Germany

56%

29%

14%

30%

Spain

11%

41%

France

Switzerland

USA

Other countries

Q1–2—2011

Revenue by country

Despite adverse market conditions, the GFT Group once

Germany contributed €79.50 million to total revenue

again succeeded in expanding its traditionally strong rev-

and thus remains the GFT Group’s largest sales market. In comparison with the same period last year, revenue grew by €16.02 million, or 25% (prev. year: €63.48 million). This positive development was mainly due to increased revenue of the Resourcing division, which was able to benefit from the ongoing recovery of the industrial sector. Germany’s share of total revenue grew from 55% in the previous year to 56%. Demand from the financial sector remained high in the UK during the first six months of 2011. Local financial institutes continued to seek IT solutions for corporate and investment banking in the second quarter. Revenue increased by 9% year on year to €19.23 million (prev. year: €17.57 million). The UK was thus the GFT Group’s second-largest market. Comparatively stronger revenue growth in other countries, however, led to a slight dip in the country’s share of total revenue (14% compared to 15% last year). The development of revenue in France was decisive for the increase in overall revenue of the GFT Group. In the first two quarters of 2011, a total of €15.49 million was generated with clients in this market, corresponding to strong year-on-year growth of 65% (prev. year: €9.38 million). The figure reflects increased demand for freelance IT specialists, both in the financial and industrial sectors. In addition to expanding our relations with existing clients, the Resourcing segment in France also added several not able new customers. The country’s share of total revenue increased to 11% (prev. year: 8%).

enues in Spain. The Services division benefited from stable long-term projects and demand from European financial institutes for outsourcing solutions. In the first six months of 2011, a total of €13.16 million was generated in Spain. This translates to year-on-year growth of 13% (prev. year: €11.64 million) and a share of total revenue of 9% (prev. year: 10%). There was strong revenue growth of 63% in Switzerland during the period under review. Revenue generated with clients in Switzerland amounted to €4.85 million and thus €1.87 million more than in the previous year (€2.98 million). Sales in Switzerland were positively influenced by an expansion of activities in both divisions and by the acquisition of Asymo AG. The Swiss market continues to account for 3% of the GFT Group’s total revenue. As in the UK, the Services division in the USA was able to exploit the ongoing stable demand for IT solutions in the field of investment and corporate banking. Revenue in the first six months of 2011 amounted to €3.46 million, corresponding to growth of 5% over the previous year (€3.30 million). Projects in the USA thus accounted for 2% of total revenue (prev. year: 3%). The proportion of total revenue generated by clients in “Other countries” – including Brazil, the Benelux states and Italy – amounted to 5% in the period under review (prev. year: 6%). The GFT Group generated revenue of €6.11 million with clients in these countries, corresponding to a year-on-year decline of 3% (prev. year: €6.33 million).

Revenue by industry With a share of total revenue of 67%, the importance of the financial sector for the GFT Group fell slightly in the period under review (prev. year: 70%) but remains the most important industry. Projects with banks and insurance companies generated revenue of €94.80 million in the first two quarters of 2011. This represents an increase of 18% over the previous year (€80.02 million).

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❘

Interim Management Report

Earnings position There was also strong growth in revenue with clients in

In the first six months of 2011, the GFT Group raised

the postal and logistics industry. At €10.09 million

earnings before taxes (EBT) by 19% year on year. As

(prev. year: €7.85 million), revenue was up 29% year on

of 30 June 2011, the Group reported EBT of €5.52 million

year. In addition to long-term projects in the Services div

(prev. year: €4.65 million). As in the preceding quarter,

ision, growth in this sector was driven above all by growing

both segments benefited from strong demand and im-

demand for freelance IT specialists in the Resourcing div

proved margins.

ision. In the period under review, the postal and logistics industry continued to account for 7% of total revenue.

At the end of the first half-year 2011, earnings before interest and taxes (EBIT) amounted to €5.13 million

The recovery of the industrial sector, which is included

(prev. year: €4.36 million). Earnings before interest,

in the “Others” category, and the resulting increase in

taxes, depreciation and amortisation (EBITDA) stood

demand for freelance IT experts and engineers, led to a

at €5.76 million on 30 June 2011 and were thus up 17%

significant increase in revenue in this sector. In the first

over the previous year (€4.93 million).

six months of 2011, the GFT Group generated revenue of €36.91 million in this sector – 38% more than in the previous year (€26.81 million). As a result, its share of total revenue rose to 26% (prev. year: 23%). The Resourcing division succeeded in both expanding its project volume with existing clients as well as gaining new customers.

After deducting all expenses, the GFT Group thus generated net income of €3.63 million in the first six months of 2011 – 2% more than in the same period last year (€3.55 million). Increased tax expenses prevented any stronger increase. Compared to the first quarter of 2011, the calculated tax ratio remained unchanged at 34% due to differences in the earnings of different countries. Income tax expenses also include reversals of deferred tax claims on loss carry forwards in Germany amounting to €0.33 million. In the previous year, the GFT Group’s tax ratio was an unusually low 24%. As a result, earnings per share improved slightly from

Revenue by industry

€0.13 last year to €0.14 per share for the period under review. These figures are based on 26,325,946 outstanding shares.

Financial services providers Postal/Logistics Others

Q1–2 2011 67% 7% 26%

Q1–2—2011

Earnings by segments

Services € million

Resourcing

Total

Others

Q1–2/10

Q1–2/11

Q1–2/10

Q1–2/11

Q1–2/10

Q1–2/11

Q1–2/10

Q1–2/11

4.01

4.56

0.86

1.65

-0.22

-0.69

4.65

5.52

In the first six months of 2011, the Services segment

Group earnings position by income and expense items

contributed €4.56 million to earnings – an increase of

In the period under review, other operating income

14% over the previous year (€4.01 million). Segment

amounted to €1.38 million and was thus well below the

earnings in the second quarter of 2011 amounted to

prior-year figure of €2.08 million. Currency gains and

€3.12 million (prev. year: €2.72 million). Consistently high

the liquidation of provisions were far lower in the first six

demand for IT projects led to rising utilisation of staff in

months of 2011 than in the previous year.

Group earnings position by segment

this segment. The acquisition of Asymo AG in Switzerland also made a positive impact. Expenditure in connection with its acquisition and integration is not attributed to the operating result of this business division. The increased revenue generated by the Resourcing segment was also reflected in segment earnings. With €1.00 million earned in the second quarter alone, the segment result as of 30 June 2011 reached €1.65 million (prev. year: €0.86 million). The Resource Management business accounted for the major share of earnings. EBT in this field improved from €0.73 million last year to €1.43 million for the first six months of 2011 – an increase of 96%. There was also growth in earnings of the segment’s Third Party

The cost of materials increased in line with strong demand in the Resourcing division to €84.48 million as of 30 June 2011. This corresponds to growth of 33% over the prior-year figure of €63.31 million. Personnel expenses increased by 8% to €41.96 million and were thus largely in line with the rise in headcount over the first half of 2010 (prev. year: €38.69 million). Depreciation of non-current intangible and tangible assets rose from €0.57 million last year to €0.63 million in the first six months of 2011 and were thus at a normal level for the GFT Group.

Management business, from €0.13 million last year to

As of 30 June 2011, other operating expenses amounted

€0.22 million in the period under review. As a result, the

to €10.87 million (prev. year: €9.82 million). The increase

operating margin in this segment improved from 1.5% in

resulted mainly from increased sales expenditure for travel

the previous year to 2.0% this year.

and advertising, as well as from a rise in administrative costs due to the expansion of business.

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Interim Management Report

Financial position

Asset position

Cash, cash equivalents and securities amounted to

The balance sheet total of the GFT Group at the end

€18.09 million as of 30 June 2011 (prev. year: €26.44

of the second quarter of 2011 was up by €6.51 million

million). The decline is due in part to the acquisition of

to €135.09 million. At year-end 2010, the figure had

Asymo AG in June 2011, which was financed exclusively

amounted to €128.58 million.

from company funds. Further factors included the dividend payment and an increase in trade receivables.

On the asset side, non-current assets fell slightly from €42.19 million at year-end 2010 to €41.87 million. Within

Increased demand for freelance employees and their result-

this item, there was an increase in goodwill following

ing acquisition led to a sharp rise in both trade receivables

the acquisition of Asmyo AG in Switzerland. Non-current

and trade payables. Trade receivables amounted to

financial assets fell by almost the same amount. There was

€76.34 million at the end of the first half of 2011 (prev.

a disproportionately strong increase, however, in current

year: €56.19 million). Moreover, administrative problems

assets to €93.22 million (31 December 2010: €86.39 mil-

in the purchasing system of a major client also hindered

lion). Due to strong growth in the Resourcing segment and

punctual payment. In line with the development of receiv

delayed payments from a major client, trade receivables

ables, trade payables grew for the reasons stated above

rose sharply to €76.34 million at the end of the first six

from €17.56 million last year to €26.95 million in the first

months (31 December 2010: €54.80 million). This was

half of 2011.

offset by a fall in cash and cash equivalents due to the divi-

Cash flows from operating activities deteriorated in line with working capital in the first six months of 2011

dend payment and acquisition of Asymo AG in the second quarter of 2011.

and amounted to €-11.62 million (prev. year: €-8.59 mil-

On the liabilities side, equity changed only slightly from

lion). As in previous years, cash flows from operating activ

€71.27 million as of 31 December 2010 to €71.17 million

ities will gradually improve in the third quarter and become

on 30 June 2011. Debt increased from €57.31 million as

strongly positive by year-end.

of 31 December 2010 to €63.92 million on 30 June 2011.

At the end of the second quarter, cash flows from investing activities amounted to €-0.84 million. The figure includes proceeds from the disposal of financial assets and a similar amount of payments in connection with the ac-

The rise resulted from a number of smaller items belonging to current liabilities. Compared with year-end 2010, trade payables fell slightly to €26.95 million (31 December 2010: €27.87 million).

quisition of Asymo AG in Switzerland. The prior-year figure

There was consequently a slight decline in the equity

of €-11.08 million had resulted from the acquisition of

ratio to 53% (31 December 2010: 55%).

long-term financial assets in the second quarter of 2010. Cash flows from financing activities mainly refer to dividend payments to the company’s owners and amounted to €-3.54 million at the end of the second quarter of 2011 (prev. year: €-2.23 million). The difference resulted from the increase in dividend from €0.10 per share for 2009 to €0.15 per share for fiscal year 2010, paid in the second quarter of 2011.

Q1–2—2011

Group balance sheet structure

ASSETS in € million

31/12/ 2010

30/06/ 2011

31/12/ 2010

EQUITY & LIABILITIES in € million

Cash, cash equivalents and securities

40.32

18.09

61.64

55.22

Current liabilities

Other current assets

58.77

81.41

2.28

2.09

Non-current liabilities

Other non-current assets

29.49

35.59

71.17

71.27

Equity capital

128.58

135.09

128.58

Employees At the end of the second quarter, the GFT Group

In the Resourcing division, headcount grew from 97 last

employed a total of 1,317 people. This represents an

year to 99 at the end of the second half of 2011.

increase of 108 persons or 9% year on year. The number of employees is calculated on the basis of full-time staff, while part-time staff are included on a pro rata basis. The increase in headcount reflects the consistently high util

The “Others” category comprises 40 persons belonging to the holding company – one more than at this time last year.

isation of development capacity. Employees by division as of 30 June

Compared with the same date last year, staff employed in the Services division grew by 105 persons. As of

2011

2010

30 June 2011, the segment now employs 10% more people (1,178) than in the previous year.

Services

1,178

1,073

Resourcing

Others

1,317

1,209

Total

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Interim Management Report

The number of people employed in Germany increased

This strong increase results from the following strategic

by 5%, from 267 on 30 June 2010 to 280 at the end of

innovation projects initiated in 2010 and continued in the

the second quarter of 2011. The proportion of staff em-

first half of 2011:

ployed outside Germany thus amounted to 79% (1,037 employees), compared to 78% on the same date last year.

a-touch: GFT will continue to drive the development of this touch banking solution for financial advisors. a-touch

The strong increase in staff employed in Switzerland re-

is an intelligent IT application which also allows the use of

sults from the acquisition of Asymo AG. By taking over the

modern mobile devices for financial advising in the field of

Swiss company, GFT gained 23 new employees.

private banking and wealth management.

The average number of freelancers employed in the first

SAP Competence Centre: with its SAP Competence Centre,

half of the year rose from 1,140 last year to 1,383 persons.

GFT helps banks to convert their systems to SAP software. Clients benefit from individually developed application possibilities for their transformation and migration process.

Employees by country as of 30 June

Mobile Finance: since 2009, GFT has been developing

2011

2010

Germany

280

267

Competence Centre and developing ideas for the mobil

Brazil

157

143

isation of business processes.

France

Switzerland

778

732

1,317

1,209

79%

78%

Spain USA Total

Foreign share in %

Research and development In the first two quarters of 2011, the GFT Group invested €0.98 million (prev. year: €0.65 million) in its R&D activ ities. This corresponds to a year-on-year increase of 51%. Personnel costs accounted for the largest share of this total (89% or €0.87 million).

business models for mobile devices at its Mobile Finance

The “Finance IT” initiative aimed at developing innovative IT solutions for banks has been completed. In June 2011, GFT was able to renew the CMMI® (Capability Maturity Model Integration) Level 3 certificate which it first received in 2008. The company has thus cemented the foundations for consistently high quality in its global development efforts.

Subsequent events No events of major significance to GFT occurred after the balance sheet date as at 30 June 2011.

Q1–2—2011

Opportunity and risk report In the first six months of 2011, there were no material

The IMF’s economists have also identified signs of a slow-

changes with regard to the comprehensive discussion

down in Germany for the coming year. Following growth

of opportunities and risks provided in the Management

of 3.2% in the current year, the German economy is ex-

Report accompanying the 2010 Consolidated Financial

pected to grow by 2.0% in 2012 – 0.1 %-points less than

Statements. The GFT Group’s risk position is therefore

the IMF forecast in April 2011. The strong order position in

unchanged.

Germany at present may suffer from a weakening of the current dynamic demand from overseas markets. The German Federal Association for Information Technol-

Forecast report

ogy, Telecommunications and New Media (BITKOM) has not changed its half-year forecast for the ICT market in the current and coming fiscal years. The association expects

The economic upturn is not likely to continue with the momentum expected at the beginning of 2011. As the potential risks began to accumulate over the course of the second quarter, experts at the International Monetary Fund (IMF) predicted a slight slowdown in the pace of global economic growth in their latest report. The IMF now forecasts growth of 4.3% in the current year and 4.5% in 2012. Economists believe the reasons for this loss of momentum may be the setback to the US market’s recovery, although a more modest outlook for China has also tempered expectations. The high level of sovereign debt among certain Euro zone nations is also giving cause for concern. The downgrading of Greece, Ireland and Portugal by the world’s leading rating agencies reflects market concerns that necessary budget consolidations have not yet been implemented. The IMF has urged the nations in question to carry out much-needed structural reforms and warned against a potential spread of the debt crisis. For the current year, the IMF’s economists predict that the Euro zone will grow by 2.0% and have thus upgraded their April forecast of 1.6%. This European growth will be driven above all by Germany and France. For 2012, however, the IMF has downgraded its April forecast by 0.1 %-point and now expects the Euro zone to grow by 1.7%.

market volume to grow by 2.3% to €133.0 billion in 2011 and by 2.4% to €136.2 billion in 2012. BITKOM forecasts above-average growth in revenue for the IT Services segment with a market volume of €34.2 billion in 2011 and €35.5 billion in 2012. However, there has also been a change in expectations among IT service companies interviewed for the association’s latest survey on the sector mood: whereas in April 2011, 89% of companies expected rising revenues, the figure had fallen to 82% by July 2011. The opportunities offered by the economic upswing and the challenges presented by developments on the world’s financial markets will shape the GFT Group’s progress over the remaining months of the current year. Even if economic growth begins to slow – as forecast by many experts – this will affect different sectors and nations in different ways. With its wide range of services and international alignment, the GFT Group can react to any cyclical changes in the capital spending of certain sectors by utilising the specific possibilities of its Services and Resourcing segments to dampen such effects.

➜

❘

Interim Management Report

The Resourcing division will continue to benefit strongly

will continue to exploit any growth opportunities which

from increased demand for freelance IT specialists and

arise. These include in particular outsourcing services and

engineers across all nations and sectors during 2011. With

IT solutions for regulatory compliance, as well as modern

the growing stability of the industrial sector, this trend is

client management systems. With its innovative and secure

likely to become even stronger. Thanks to its international

solutions for investment consulting and mobile banking

network of specialists, GFT is capable of meeting the

applications, as well as the expertise gained from its acqui-

needs of numerous companies for flexible, highly skilled

sition of Asymo AG, GFT is well positioned to maintain its

specialists. In the coming months, the Resourcing seg-

growth trajectory – also in the Services division.

ment expects dynamic growth rates above all in France,

The GFT Group therefore expects to continue its steady

Germany, the UK and Switzerland. Apart from expanding

growth in the rest of 2011 and confirms the forecast

its projects with existing clients, the division also proved

made in the Consolidated Financial Statements 2010: the

highly successful in acquiring new customers in the

Executive Board expects total revenue of €275 million and

first two quarters. It is likely that a sizable proportion of

earnings before taxes of €13 million in fiscal year 2011.

revenue in the second half of 2011 will also be generated with new clients. Against the backdrop of a challenging market environment in the financial sector, the Services division expects to maintain its stable development at a high level in the remaining months of fiscal year 2011. The GFT Group is closely monitoring the potential risks which may result from reduced investment in light of the Euro crisis and

Stuttgart, 9 August 2011 GFT Technologies Aktiengesellschaft The Executive Board

Ulrich Dietz

Jean-François Bodin

Marika Lulay

Dr. Jochen Ruetz

Executive Board (Chairman)

Executive Board

Q1–2—2011

Consolidated Statement of comprehensive Income for the period from 1 January to 30 June 2011 GFT Technologies Aktiengesellschaft, Stuttgart

Partial Statement Affecting Net Income: Consolidated Income Statement Half-year

€

Revenue Other operating income

Second quarter

01/01/– 30/06/2011

01/01/– 30/06/2010

01/04/– 30/06/2011

01/04/– 30/06/2010

141,803,332.84

114,679,437.63

74,500,653.63

60,250,126.07

1,384,702.41

2,078,415.66

1,037,722.18

1,200,235.97

143,188,035.25

116,757,853.29

75,538,375.81

61,450,362.04

4,855.15

14,105.03

254.41

13,235.92

Cost of materials a) Expenses for raw materials and supplies and for purchased goods b) Costs of purchased services

84,480,133.99

63,292,764.15

45,232,000.17

33,368,017.98

84,484,989.14

63,306,869.18

45,232,254.58

33,381,253.90

34,771,316.28

32,453,953.94

17,307,721.99

16,293,976.66

7,184,298.86

6,233,083.84

3,594,228.16

3,282,223.06

41,955,615.14

38,687,037.78

20,901,950.15

19,576,199.72

Personnel expenses a) Salaries and wages b) Social security and expenditures for retirement pensions

Depreciation on non-current intangible assets and of tangible assets Other operating expenses Result from operating activities Other interest and similar income Profit share from associates Depreciation on securities Interest and similar expenses Financial result

633,522.30

571,208.01

320,099.80

288,149.19

10,865,192.17

9,822,637.65

5,765,098.24

5,345,064.42

5,248,716.50

4,370,100.67

3,318,973.04

2,859,694.81

405,279.98

296,694.21

246,073.28

172,153.91

1,546.34

-13,471.45

4,363.36

-4,373.52

121,523.93

0.00

57,649.88

0.00

12,447.47

8,207.95

10,417.07

3,385.90

272,854.92

275,014.81

182,369.69

164,394.49

Earnings before taxes

5,521,571.42

4,645,115.48

3,501,342.73

3,024,089.30

Taxes on income and earnings

1,889,206.56

1,091,453.14

1,221,983.34

627,659.48

Net income from continued operations

3,632,364.86

3,553,662.34

2,279,359.39

2,396,429.82

Net loss from discontinued operations Net income

– attributable to non-controlling equity holders

0.00

-269,230.17

0.00

-234,215.78

3,632,364.86

3,284,432.17

2,279,359.39

2,162,214.04

0.00

3,632,364.86

3,284,432.17

2,279,359.39

2,162,214.04

Net earnings per share – undiluted

0.14

0.12

0.09

0.08

Net earnings per share – diluted

0.14

0.12

0.09

0.08

Net earnings per share from continued operations – undiluted

0.14

0.13

0.09

Net earnings per share from discontinued operations – diluted

0.14

0.13

0.09

– attributable to equity holders of the parent

➜

❘

Consolidated Interim Financial Statements

Partial Statement Not Affecting Net Income: Consolidated Income Statement Half-year

€

Net Income

Second quarter

01/01/– 30/06/2011

01/01/– 30/06/2010

01/04/– 30/06/2011

01/04/– 30/06/2010

3,632,364.86

3,284,432.17

2,279,359.39

2,162,214.04

65,960.51

238,500.00

-87,839.49

-18,150.00

Financial assets available for sale (securities): – Change of fair value recognised in equity during the period – Reclassification amounts to the income statement

0.00

-292,800.00

0.00

-292,800.00

65,960.51

-54,300.00

-87,839.49

-310,950.00

137,922.19

238,555.27

269,397.20

159,902.61

0.00

137,922.19

238,555.27

269,397.20

159,902.61

Exchange differences on translating foreign operations: – Profits/losses during the period – Reclassification amounts to the income statement

Income taxes on components of other result Other result

Total result

– thereof attributable to non-controlling shareholders – thereof attributable to shareholders of parent company

16,559.06

24,920.00

16,559.06

70,280.00

220,441.76

209,175.27

198,116.77

-80,767.39

3,852,806.62

3,493,607.44

2,477,476.16

2,081,446.65

0.00

3,852,806.62

3,493,607.44

2,477,476.16

2,081,446.65

Q1–2—2011

Consolidated Balance Sheet as at 30 June 2011 GFT Technologies Aktiengesellschaft, Stuttgart

Assets €

30/06/2011

31/12/2010

31/12/2009

562,976.24

431,980.03

364,535.53

26,747,788.93

20,367,546.07

20,365,010.57

27,310,765.17

20,799,526.10

20,729,546.10

2,607,057.98

2,601,922.52

2,044,691.89

Non-current assets Intangible assets Licences, industrial property rights and similar rights Goodwill

Tangible assets Other equipment, office and factory equipment Construction on foreign property

79,572.87

104,365.67

146,776.26

2,686,630.85

2,706,288.19

2,191,468.15

6,275,185.70

12,702,271.24

0.00

45,555.29

44,008.95

36,165.05

0.00

6,320,740.99

12,746,280.19

36,165.05

405,595.53

404,771.40

349,408.58

Financial assets Securities Financial assets, accounted for using the equity method Investments

Other assets Income tax assets Deferred tax assets

579,743.86

585,029.38

655,816.14

4,562,188.44

4,948,002.63

5,813,304.61

41,865,664.84

42,189,897.89

29,775,708.63

76,338,336.48

54,799,670.75

41,757,487.92

1,584,100.00

1,384,000.00

2,235,800.00

560,732.91

243,550.42

204,920.81

10,233,698.83

26,232,995.13

35,471,848.76

Current assets Trade receivables Securities Current tax assets Cash and cash equivalents Other assets

Non-current assets and disposal groups held for sale

4,507,482.05

3,727,586.93

1,886,174.47

93,224,350.27

86,387,803.23

81,556,231.96

0.00

2,049,496.73

93,224,350.27

86,387,803.23

83,605,728.69

135,090,015.11

128,577,701.12

113,381,437.32

➜

❘

Consolidated Interim Financial Statements

Shareholders‘ Equity and Liabilities €

30/06/2011

31/12/2010

31/12/2009

26,325,946.00

42,147,782.15

10,243,349.97

8,543,349.97

673,233.20

535,311.01

140,577.64

Shareholders´equity Equity attributable to equity holders of the parent Share capital – C onditional capital €7,500,000.00 (prev. year: €8,280,000.00) Capital reserve Retained earnings Other retained earnings Changes in equity not affecting net income Foreign currency translations Reserve of market assessment for securities Consolidated balance sheet loss

Interests of non-controlling equity holders

-345,280.43

-427,800.00

-410,420.00

-7,870,939.17

-7,554,412.13

-10,995,236.23

71,174,091.72

71,270,177.00

65,751,999.53

0.00

71,174,091.72

71,270,177.00

65,751,999.53

Provisions for pensions

676,225.40

652,225.40

457,472.44

Other provisions

925,472.00

969,795.00

879,895.84

Deferred tax liabilities

678,962.56

469,197.24

601,198.65

2,280,659.96

2,091,217.64

1,938,566.93

20,741,087.35

18,195,205.23

13,568,351.01

2,352,838.68

1,285,617.34

1,170,106.70

Liabilities Non-current liabilities

Current liabilities Other provisions Income tax liabilities Financial liabilities Trade payables Other liabilities

Liabilities directly associated with non-current assets and disposal groups held for sale

271,697.47

0.00

26,949,011.09

27,873,659.18

23,277,976.61

11,320,628.84

7,861,824.73

5,999,709.79

61,635,263.43

55,216,306.48

44,016,144.11

0.00

1,674,726.75

61,635,263.43

55,216,306.48

45,690,870.86

63,915,923.39

57,307,524.12

47,629,437.79

135,090,015.11

128,577,701.12

113,381,437.32

Q1–2—2011

Consolidated Statement of Changes in Equity as at 30 June 2011 GFT Technologies Aktiengesellschaft, Stuttgart

€

Subscribed

Capital

Retained

capital

reserve

earnings Other retained earnings

As at 01/01/2010

26,325,946.00

42,147,782.15

8,543,349.97

26,325,946.00

42,147,782.15

8,543,349.97

Dividend payment May 2010

Total income and expenses for the period 01/01/–30/06/2010

As at 30/06/2010

Dividend payment May 2010

Total income and expenses for the period 01/01/–31/12/2010

Allocations to retained earnings 2010 – to other retained earnings

As at 31/12/2010

1,700,000.00

26,325,946.00

42,147,782.15

10,243,349.97

26,325,946.00

42,147,782.15

10,243,349.97

Dividend payment June 2011

Total income and expenses for the period 01/01/–30/06/2011

As at 30/06/2011

â&#x17E;&#x153;

â?&#x2DC;

Consolidated Interim Financial Statements

Changes in equity not affecting

Consolidated

Equity

Non-controlling

Total

results

balance sheet

attributable to

equity holders

share capital

loss

equity holders

Foreign

Market

currency

assessment

translations

for securities

140,577.64

-410,420.00

of the parent

-10,995,236.23

65,751,999.53

0.00

65,751,999.53

-2,632,594.60

0.00

-2,632,594.60

238,555.27

-29,380.00

3,284,432.17

3,493,607.44

0.00

3,493,607.44

379,132.91

-439,800.00

-10,343,398.66

66,613,012.37

0.00

66,613,012.37

-2,632,594.60

0.00

-2,632,594.60

7,773,418.70

8,150,772.07

0.00

8,150,772.07

-1,700,000.00

0.00

-7,554,412.13

71,270,177.00

0.00

71,270,177.00

-3,948,891.90

394,733.37

535,311.01

-17,380.00

-427,800.00

-3,948,891.90

137,922.19

82,519.57

3,632,364.86

3,852,806.62

0.00

3,852,806.62

673,233.20

-345,280.43

-7,870,939.17

71,174,091.72

0.00

71,174,091.72

Q1–2—2011

Consolidated Cash Flow Statement for the period from 1 January to 30 June 2011 GFT Technologies Aktiengesellschaft, Stuttgart

Half-year

€

Net income Depreciation on non-current intangible and tangible assets Changes in provisions

01/01/– 30/06/2011

01/01/– 30/06/2010

3,632,364.86

3,284,432.17

633,522.30

588,074.01

2,527,292.96

4,869,129.41

Other non-cash expenses/income

69,610.69

194,225.21

Profit/loss from the disposal of long-term tangible and intangible assets as well as financial assets

19,986.31

-301,000.00

-20,197,806.95

-14,385,495.28

-680,670.01

-743,331.26

2,374,753.84

-2,091,272.24

-11,620,946.00

-8,585,237.98

Changes in trade receivables Changes in other assets Changes in trade liabilities and other liabilities Cash flow from operating activities

Cash receipts from sale of tangible assets

450.00

0.00

Cash payments to acquire tangible assets

-497,679.97

-429,589.02

Cash payments to acquire non-current intangible assets

-238,531.11

-74,131.02

Cash receipts from sale of financial assets

6,226,500.00

0.00

Cash payments to acquire financial assets

0.00

-10,417,448.83

Cash receipts from sale of consolidated companies net of cash and cash equivalents disposed of 1

0.00

-1,307,384.44

-6,329,816.98

0.00

1,150,000.00

-839,078.06

-11,078,553.31

-3,948,891.90

-2,632,594.60

Cash receipts from taking out financial loans

271,697.47

134,903.43

Other changes in equity

137,922.19

263,475.27

-3,539,272.24

-2,234,215.90

-15,999,296.30

-21,898,007.19

Cash funds at the beginning of the period

26,232,995.13

36,200,628.61

Cash funds at the end of the period

10,233,698.83

14,302,621.42

Cash payments from acquisition of consolidated companies net of cash and cash equivalents acquired 1 Cash receipts for the short-term financial management of cash investments Cash flow from investing activities

Payments to shareholders

Cash flow from financing activities

Change in cash funds from cash-relevant transactions

The item concerns discontinued operations.

➜

❘

Notes

Notes to the Interim Financial Statements as at 30 June 2011 GFT Technologies Aktiengesellschaft, Stuttgart

Fundamentals for the GFT Group’s Interim Financial Statements

··········································································································································

The Consolidated Interim Financial Statements of GFT Technologies

sheet date, which are to be applied within the EU. The same accounting

Aktiengesellschaft (“GFT AG”) should be read in conjunction with

and valuation methods were used in these Interim Financial Statements

the Annual Financial Statements of GFT AG as of the end of the last

as in the last Consolidated Financial Statements as at 31 December

financial year (31 December 2010). They were drawn up in euro (€) in

2010. New or amended standards and interpretations to be applied as

accordance with standard principles of accounting and valuation and

of the beginning of the financial year 2011 did not have any major ef-

conform to the prescriptions set out in IAS 34, sections 37w and 37y of

fect on the Interim Financial Statements.

the German Securities Trading Act (WpHG) and the regulations for the Frankfurt Stock Exchange. The Interim Financial Statements have been prepared according to the International Financial Reporting Standards (IFRS) issued by the Inter national Accounting Standards Board (IASB) effective on the balance

Changes to the consolidated group and its associated companies

······································································································································

The following changes to the scope of consolidation have occurred since

On 13 August 2010, the memorandum of association of subsidiary GFT

the Consolidated Financial Statements were closed on 31 December

Business Development GmbH, Eschborn, was extensively altered. This

2010:

included a change in its name to Youdress GmbH and the relocation

On 10 February 2011, GFT UK Limited, London, founded the company GFT UK Invest Limited, domiciled in London. The newly formed company has been included in the consolidated group since 10 February 2011. Since its foundation, GFT UK Invest Limited has not yet developed any operating activities of note; its initial inclusion in the consolidated accounts had no significant impact on the assets, financial and earnings position of the Group.

of its registered office to Stuttgart. These changes became effective on 1 October 2010. Subsequently on 13 August 2010, GFT AG sold 50% of shares in GFT Business Development GmbH. GFT Business Development GmbH was deconsolidated on 13 August 2010 and has since been carried as an associated company (named Youdress GmbH), whose shares are carried in the balance sheet according to the equity method. In the financial years 2010 and 2009, GFT Business Development GmbH accounted for 0.0% of Group revenues. As of 31 December 2009 and

On 9 June 2011, GFT AG acquired all shares in Asymo AG, Adliswil,

on the date of divestment, its share in Group assets amounted to 0.0%.

Switzerland. The aforementioned company was initially included in the

The deconsolidation of GFT Business Development GmbH had no ma

consolidated group as of the acquisition date of 9 June 2011. In the

terial effect on the assets, financial and earnings position of the Group;

period 1 January 2011 to 30 June 2011, its contribution to revenues of

income from the sale amounted to €11 thousand.

the GFT Group amounted to €578 thousand with a contribution to net income of this period of €159 thousand. As of 30 June 2011, Asymo AG accounted for 2.3% of the Group’s total assets. Initial inclusion in the consolidated accounts therefore had an impact on the Group’s assets, financial and earnings position and impaired comparability with prior-year figures.

On 13 August 2010, GFT AG also acquired all shares in the previously non-operating company Platin 569. GmbH, Frankfurt am Main, which has been trading as GFT Innovations GmbH with registered office in Stuttgart since 23 September 2010. The above company was first consolidated as of its date of acquisition on 13 August 2010. Its contribution to consolidated revenues of the GFT Group in the period 1 January

The following changes to the scope of consolidation have occurred since

to 31 December 2010 amounted to €0 thousand with an effect of the

the Consolidated Financial Statements were closed on 30 June 2010:

net income 2010 of €-215 thousand. As of 31 December 2010, the share in Group assets of GFT Innovations GmbH amounted to 0.0%. The initial consolidation of GFT Innovations GmbH had no material effect on the assets, financial and earnings position of the Group.

Q1–2—2011

Discontinued operations

The GFT Group intended to dispose of its business activities in the Soft-

In a purchase agreement dated 14 May 2010, the software rights of

ware division. The Executive Board of GFT AG had adopted a respective

GFT AG were sold to a non-Group company. In a share purchase agree-

disposal plan and had been actively seeking a buyer since November

ment also dated 14 May 2010, GFT AG sold all shares in the subsidiary

2009; the disposal was expected to be completed in the second quarter

GFT inboxx GmbH to the same buyer; the Software segment was thus

of 2010. Most of the activities in this business division, and the respect

disposed of. All assets and liabilities of the Software segment were

ive employees, were pooled with the subsidiary GFT inboxx GmbH,

transferred on 14 May 2010, with the exception of pension obligations

Hamburg, Germany. All shares in this subsidiary were to be sold. More

and the respective securities which the Group retains in contrast to the

over, the Software division of GFT AG included disclosed software rights

original plan due to the developing sales process; this decision had no

which are also to be sold. The Software division to be sold was identical

impact on the net income of the financial year 2010. The disposal of the

with the Software segment, which is disclosed separately in segment

Software segment resulted in a loss of €464 thousand.

reporting.

The net loss after taxes of the discontinued operation is disclosed in a

Discontinuation of the business division will take the form of a disposal

separate line of the Consolidated Statement of Comprehensive Income

as a whole. As the division intended for disposal also represents a

(2010, Consolidated Income Statement section). The Consolidated Bal-

disposal group as defined by IFRS 5, the disclosure and measurement

ance Sheet also includes assets and liabilities pertaining to discontinued

regulations of IFRS 5 have been applied.

operations, summarised as separate items (31 December 2009).

The discontinuation of the business division in the second quarter of the financial year 2010 was realised as follows:

Business combinations during the fiscal year

Business combination Asymo AG, Adliswil, Switzerland

The fair value of the total transferred consideration valid on the date of

On 9 June 2011 (acquisition date), GFT AG acquired 100% of equity

purchase amounts to €7.9 million; it refers in full to the cash offered. In

shares with voting rights in Asymo AG, Adliswil, Switzerland, and thus

addition to this consideration as of the purchase date, there are agree-

gained control of the acquired company. Asymo AG is a Swiss IT con

ments concerning considerations in return which depend on the future

sultancy for the core banking solution Avaloq.

earnings of the acquired company; due to their uncertainty, no amount

The main reasons for the business combination were to strengthen GFT’s position as an IT specialist for banks in the important Swiss market and

was recognised at the date of purchase. The range of these consider ations in return not yet recognised is between CHF 0 and CHF 8 million.

to expand its portfolio of services by adding top-quality consultancy

The acquired receivables refer to trade receivables. The fair value of

expertise in the field of standard software for banks. The factors con

acquired receivables amounts to €1,341 thousand, their gross amount is

tributing to the acquisition costs which were used in the measurement

€1,385 thousand. As of the acquisition date, receivables expected to be

of goodwill were as follows:

uncollectible amount to €44 thousand.

a) the outstanding skills and activities of Asymo AG’s employees;

The amounts for each major group of acquired assets and assumed

b) the existing positioning of Asymo AG with customers for core banking applications, including existing general agreements; c) the expected synergies between GFT and Asymo AG in the joint development of existing accounts and new markets; d) intangible assets which are not classified for separate measurement. The following figures are preliminary and will change as certain purchase price components have not yet been set or depend on future developments and other quantitative examinations, e.g. the identification of transferred intangible assets, have not yet been conducted.

liabilities at the time of acquisition are shown below:

➜

€ thsd.

❘

Notes

Carrying value = fair value

Non-current assets Tangible assets

Current assets Trade receivables

1,341

Other assets

Cash and cash equivalents

1,554 2,921 2,955

Liabilities Current liabilities Provisions

372

Liabilities

1,079 1,451

Acquired net assets

1,504

Acquisition costs

7,884

Goodwill

6,380

The resulting goodwill was allocated to the Services segment (cash-

On the assumption that the acquisition date for all business combin

generating unit Services – Finance & Insurance).

ations during the reporting period was the beginning of this period, the

The acquired company was included in the Consolidated Statement of Comprehensive Income (Consolidated Income Statement section) from the acquisition date until 30 June 2011 with revenue of €578 thousand

revenue of the GFT Group in the reporting period 1 January 2011 to 30 June 2011 would have been €144.81 million and earnings (net income) €4.60 million.

and net income of €159 thousand.

Changes in equity

For the changes in equity capital between 1 January 2011 and 30 June

Authorised capital

2011, we refer to the Consolidated Statement of Changes in Equity

The Company’s existing authorised capital, as defined in § 4 (5) of the

which is disclosed separately.

Company’s Articles, expired on 22 May 2011; the authorisation for this

As of 30 June 2011, the Company’s share capital of €26,325,946.00

authorised capital was cancelled at the Annual General Meeting on

consists of 26,325,946 non-par value individual share certificates (no

31 May 2011. New authorised capital was created as follows:

change relative to 31 December 2010). These shares are bearer shares

In accordance with the resolution passed by the Annual General Meet-

and all grant equal rights.

ing of 31 May 2011, the Executive Board is authorised to increase

In May 2011, a dividend of €0.15 per share was distributed to share-

the share capital on or before 30 May 2016, with the consent of the

holders, totalling €3,949 thousand, from the balance sheet profit of

Supervisory Board, through the issuance of new bearer shares against

the parent company GFT AG (May 2010: dividend of €0.10 per share,

contributions in cash or in kind up to a total of €10,000,000.00 on one

totalling €2,633 thousand).

or more occasions (Authorised capital). The Executive Board is authorised

As of 30 June 2011, GFT AG did not hold any of its own shares, nor did it purchase or sell any of its own shares in the period 1 January 2011

to exclude shareholders’ subscription rights with the consent of the Supervisory Board in the following cases:

to 30 June 2011.

–

to waive subscription rights for fractional amounts;

The following changes in the Company’s authorised and conditional

–

for capital increases against contributions in kind in order to grant

capital were made between 1 January and 30 June 2011 relative to

shares for the purpose of acquiring companies or holdings in com-

31 December 2010.

panies;

–

Q1–2—2011

in the event of a capital increase against cash contributions, pro-

The Executive Board is authorised to establish additional details for the

vided that the issue price of the new shares is not significantly lower

execution of a capital increase from authorised capital with the consent

than the stock exchange price and provided that the proportionate

of the Supervisory Board.

amount of share capital attributable to the new shares for which subscription rights are excluded, does not exceed ten percent of share capital, neither at the time at which this authorisation be-

–

As at 30 June 2011, there was therefore unutilised authorised capital in the amount of €10,000,000.00 (31 December 2010: €10,000,000.00).

comes effective nor at the time at which it is exercised;

Conditional capital

in the event of a capital increase for the issue of employee shares,

By resolution of the Annual General Meeting on 31 May 2011, Condi-

provided that the proportionate amount of share capital attributable

tional capital I/1999 amounting to €780,000.00 was cancelled. Condi-

to the new shares, for which subscription rights are excluded, does

tional capital II/2007 amounting to €7,500,000.00 continues to exist.

not exceed ten percent of share capital, neither at the time at which this authorisation becomes effective nor at the time at which it is exercised.

Segment reporting

As at 30 June 2011, there was therefore total conditional capital of €7,500,000.00 (31 December 2010: €8,280,000.00).

GFT has identified the three segments Services, Resourcing, and (until

Internal controlling and reporting within the GFT Group, and thus also

14 May 2010) Software as reportable segments. The identification of

segment reporting, is based on IFRS accounting principles as applied

these segments was mainly based on the fact that the products and

in the Consolidated Financial Statements. The GFT Group measures

services offered in these segments show differences, and that the GFT

the success of its segments by means of segment EBT (earnings before

Group is organised, managed and controlled on the basis of these

taxes). Segment income and results also include transactions between

segments. Internal reporting to the Executive Board is based on the clas-

the segments. Intersegment transactions take place at market prices on

sification of Group activities in these segments. The Software segment

an arm’s length principle.

was sold in May 2010; we refer to the explanations on discontinued operations.

As a general rule, the assets of the segments include all assets, except for those from income tax and assets attributed to the holding activity.

The products and services with which the reportable segments generate

The segment liabilities include all liabilities, except for those from income

their income can be characterised as follows: all activities in connection

tax, financing, and liabilities in connection with the holding activity.

with IT solutions (services and projects) are aggregated in the Services segment. The Resourcing segment focuses on the placement of freelance IT specialists. The Software segment concerned the internal development of software products, their distribution, and associated services.

For detailed information about the business segments, please refer to the Appendix attached to the Notes to the Consolidated Financial Statements. It also includes disclosures concerning revenue from external clients for each group of comparable products and services. The reconciliation of the segment figures to the corresponding figures in the Consolidated Financial Statements is as follows:

€ thsd.

Total segment revenue Elimination of intersegment revenue Group revenue

Total segment results (EBT) Non-attributed expenses/income of Group HQ Non-attributed income for elimination of interim results Group result before taxes

01/01/– 30/06/2011

01/01/– 30/06/2010

145,086

124,592

-3,283

-8,843

141,803

115,749

6,213

4,807

-742

-152

5,522

4,655

➜

€ thsd.

Total segment assets

❘

Notes

30/06/2011

30/06/2010

121,434

96,167

Non-attributed assets of Group HQ Securities Assets from income taxes Group assets

Total segment liabilities

7,859

12,140

5,703

6,853

135,090

115,234

60,630

45,963

Non-attributed liabilities of Group HQ Liabilities from income taxes Group liabilities

254

285

3,032

2,373

63,916

48,621

The reconciliation discloses items which per definition are not compon

The table below shows information according to geographic regions for

ents of the segments. In addition, non-attributed items of Group HQ,

the GFT Group:

e.g. from centrally managed issues, are also contained. Business transactions between the segments are also eliminated in the reconciliation.

Revenue from sales to external clients 1

Non-current intangible and tangible assets

01/01/– 30/06/2011

01/01/– 30/06/2010

30/06/2011

30/06/2010

Germany

79.50

64.27

28.35

21.58

19.23

17.57

0.13

0.16

Spain

13.16

11.64

0.98

0.67

France

€ million

15.49

9.38

0.07

0.05

USA

3.46

3.30

0.00

Switzerland

4.85

2.98

0.17

0.09

Other countries Total 2

6.11

6.61

0.30

0.34

141.80

115.75

30.00

22.89

Determined by client location

Total company

Revenue from clients who account for more than 10% each of Group revenue is shown below:

Revenue

Segments in which this revenue is generated

€ million

Client 1

01/01/– 30/06/2011

01/01/– 30/06/2010

01/01/– 30/06/2011

01/01/– 30/06/2010

66.86

51.96

Services, Resourcing

Services, Resourcing, Software

Q1–2—2011

Segment report GFT Technologies Aktiengesellschaft, Stuttgart

Services

€ thsd.

External sales Inter-segment sales Total revenues

Depreciation Non-cash income/expenditure other than depreciation Interest income Interest expenses Share of net profits of associated companies reported according to the equity method

Segment result (EBT)

Segment assets Investment in associates reported according to the equity method Investment in non-current intangible and tangible assets

Segment liabilities

Software

30/06/2011

30/06/2010

30/06/2011

30/06/2010

58,259

56,213

1,101

58,259

56,221

1,133

-496

-491

-17

-23

-254

109

-16

-86

-13

4,564

4,014

-62

68,453

61,661

6,960

415

21,397

17,194

â&#x17E;&#x153;

Resourcing

Total

â?&#x2DC;

Notes

Eliminations

30/06/2011

30/06/2010

30/06/2011

30/06/2010

83,544

58,435

141,803

115,749

30/06/2011

Consolidated

30/06/2010

30/06/2011

30/06/2010

141,803

115,749

3,283

8,803

3,283

8,843

-3,283

-8,843

86,827

67,238

145,086

124,592

-3,283

-8,843

141,803

115,749

-118

-62

-614

-570

-20

-18

-634

-588

-23

-224

-47

-70

-194

111

345

186

405

297

-48

-30

-64

-116

108

-12

-8

-13

1,649

855

6,213

4,807

-691

-151

5,522

4,656

52,981

34,506

121,434

96,167

13,656

19,067

135,090

115,234

135

7,095

488

7,116

504

39,233

28,769

60,630

45,963

3,286

2,658

63,916

48,621

Q1–2—2011

Changes to contingent liabilities

As of 30 June 2011, there were no significant changes to contingencies and other financial commitments compared to the Consolidated Financial Statements as at 31 December 2010.

Investments

·· · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · · ·

During the period 1 January to 30 June 2011, the GFT Group invested €6,618 thousand in intangible assets (1 January to 30 June 2010: €74 thousand), of which goodwill accounted for €6,380 thousand (1 January to 30 June 2010: €0 thousand), and €498 thousand in tangible assets (1 January to 30 June 2010: €430 thousand).

Related party disclosures

Compared to the disclosures made in the Notes to the Consolidated Financial Statements as at 31 December 2010, there were no changes in the composition of related parties nor in relations with such parties apart from the following. Dr. Paul Lerbinger and Dr. Ing. Andreas Bereczky were elected as new members of the Supervisory Board. Mr. Franz Niedermaier retired from the Supervisory Board.

Stuttgart, 9 August 2011 GFT Technologies Aktiengesellschaft The Executive Board

Ulrich Dietz

Jean-François Bodin

Marika Lulay

Dr. Jochen Ruetz

Executive Board (Chairman)

Executive Board

Responsibility statement

To the best of our knowledge, and in accordance with the applicable interim reporting principles, the consolidated interim financial statements give a true and fair view of the assets, liabilities, financial posÂ ition and profit or loss of the Group, and the Group management report includes a fair review of the development and performance of the business and the position of the Group, together with a description of the principal opportunities and risks associated with the expected development of the Group in the remaining fiscal year 2010.

Stuttgart, 9 August 2011 GFT Technologies Aktiengesellschaft The Executive Board

Ulrich Dietz

Jean-FranĂ§ois Bodin

Marika Lulay

Dr. Jochen Ruetz

Executive Board (Chairman)

Executive Board

Q1–2—2011

Review report

To GFT Technologies Aktiengesellschaft, Stuttgart We have reviewed the condensed consolidated interim financial statements – comprising the condensed balance sheet, condensed income statement and statement of comprehensive income, condensed cash flow statement, and selected explanatory notes – and the interim Group management report of GF T Technologies Aktiengesellschaft, Stuttgart, for the period from 1 January to 30 June 2011, which are part of the half-yearly financial report pursuant to § 37w WpHG (Wertpapierhandelsgesetz: German Securities Trading Act). The preparation of the condensed consolidated interim financial statements in accordance with the IFRSs applic able to the interim financial reporting as adopted by the EU and to the interim Group management report in accordance with the provisions of the German Securities Trading Act applicable to interim group management reports is the responsibility of the parent company’s board of management. Our responsibility is to issue a review report on the condensed consolidated interim financial statements and on the interim Group management report based on our review. We conducted our review of the condensed consolidated interim financial statements and the interim Group management report in accordance with German generally accepted standards for the review of financial statements promulgated by the “Institut der Wirtschaftsprüfer” (Institute of Public Auditors in Germany) (IDW). These standards require that we plan and perform the review so that we can preclude through critical evaluation, with moderate assurance, that the condensed consolidated interim financial statements have not been prepared, in all material respects, in accordance with the IFRSs applicable to interim financial reporting as adopted by the EU, the IFRSs as issued by the IASB applicable to the interim financial reporting and that the interim Group management report has not been prepared, in all material respects, in accordance with the provisions of the German Securities Trading Act applicable to interim group management reports. A review is limited primarily to inquiries of company personnel and analytical procedures and therefore does not provide the assurance attainable in a financial statement audit. Since, in accordance with our engagement, we have not performed a financial statement audit, we cannot express an audit opinion. Based on our review, no matters have come to our attention that cause us to presume that the condensed consolidated interim financial statements have not been prepared, in all material respects, in accordance with the IFRSs applicable to interim financial reporting as adopted by the EU nor that the interim Group management report has not been prepared, in all material respects, in accordance with the provisions of the German Securities Trading Act applicable to interim group management reports.

Stuttgart, 10 August 2011 Warth & Klein Grant Thornton AG Wirtschaftsprüfungsgesellschaft

Gernot Hämmerle

Jürgen Scheftschik

Auditor

Financial Calendar

Further information

Interim Report as of 30 September 2011

Write to us or call us if you have any questions. Our Investor Relations

9 November 2011

team will be happy to answer them for you. Or visit our website at www.gft.com/ir. There you can find further information on our company and the GFT share.

GFT Technologies AG Investor Relations Andrea Wlcek Filderhauptstrasse 142 70599 Stuttgart Germany T +49 711 62042-440 F +49 711 62042-301 ir@gft.com

This Interim Report as of 30 June 2011 is also available in German. The online versions of the German and English Interim Reports are available on www.gft.com/ir.

IMPRINT Concept: GFT Technologies AG, Stuttgart, www.gft.com Text: GFT Technologies AG, Stuttgart, www.gft.com Creative concept and design: Impacct Communication GmbH, Hamburg, www.impacct.de

ÂŠ Coypright 2011: GFT Technologies AG, Stuttgart