GFT Half-yearly financial report H1/2013 by GFT Technologies SE

Half-yearly financial Report as of 30 June 2013

digi tal pio neer ing

Q1–2–2013

Key figures according to IFRS (not certified)

Half-year

01/01/– 30/06/2013

01/01/– 30/06/2012

Change

Income Statement Revenue

€m

114.19

116.38

-1.9%

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

€m

6.09

4.43

37.5%

Earnings before interest and taxes (EBIT)

€m

5.36

3.67

46.0%

Earnings before taxes (EBT)

€m

5.50

3.78

45.4%

Net income

€m

4.36

2.36

84.7%

Other non-current assets

€m

47.90

45.40

5.5%

Cash, cash equivalents and securities

€m

27.71

30.40

-8.9%

Other current assets

€m

57.95

54.41

6.5%

Assets

€m

133.56

130.21

2.6%

Balance Sheet

Non-current liabilities

€m

6.34

8.15

-22.2%

Current liabilities

€m

48.57

48.90

-0.7%

Shareholders’ equity

€m

78.65

73.16

7.5%

Shareholders’ equity and liabilities

€m

133.56

130.21

2.6%

Equity ratio

59%

56%

4.8%

Cash flow from operating activities

€m

-8.83

-5.56

59.0%

Cash flow from investing activities

€m

0.87

-0.57

-252.6%

Cash flow from financing activities

€m

-1.35

-3.48

-61.3%

no.

1,503

1,371

9.6%

0.17

0.09

84.7%

26,325,946

0.0%

Cash flow

Employees Number of permanent employees (as of 30 June)

Share Earnings per share Average number of outstanding shares (undiluted)

€

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

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Highlights

The GFT Group closed the first six months of 2013 with solid revenue growth and a strong improvement in earnings. For the second half of 2013, the Executive Board expects a further positive development of business and anticipates an additional growth impetus from the acquisition of the Italian company Sempla. For the financial year 2013, the Executive Board now expects revenue of €260 million and has upgraded its forecast for earnings before taxes (EBT) to at least €15 million. Earnings before interest, taxes, depreciation and amortisation (EBITDA) are expected to reach at least €19 million in 2013.

Revenue

€ million

Earnings before taxes

2012

56.08

58.23

58.73

2013

2012

€ million

4.31

2013

4.02

58.68

2.51

3.95

57.65

55.51

1.27

1.55

230.69

114.19

12.11

5.50

Contents Consolidated Interim Management Report Notes to the Interim Financial Statements

… …

2 23

Consolidated Interim Financial Statements

…

Q1–2–2013

Group Management Report of GFT Technologies Aktiengesellschaft as of 30 June 2013 (not certified)

Business environment Economic environment Macroeconomic development The global economy will be less prone to fluctuation and

repercussions of Germany’s catastrophic floods during the second quarter are still not clear, German managers are generally upbeat. This was the conclusion of ifo’s Business Climate Index conducted in June.

enjoy moderate growth in future. This is the forecast of the World Bank. Whereas the economists predicted global economic growth of 2.4% in January 2013, they downgraded their expectations to 2.2% on completion of the first six months of 2013. Although the US economy is still performing well in comparison to other major economic regions, both the World Bank and International Monetary Fund (IMF) believe slower growth in the emerging nations represents a serious danger. The latter were a vital motor of global growth during the financial crisis of 2008. Two of the heavyweights, China and Brazil, are now experiencing economic difficulties. According to both institutes, the main burden to growth is still the recession in Europe. The eurozone crisis has lasted five years already and affected almost all member states. Even such major economies as France, Italy and Spain are now mired in recession. All three of these countries are suffering their highest ever levels of unemployment. It was only in July 2013, that European Central Bank (ECB) boss Mario Draghi calmed the markets somewhat by promising that the ECB would buy an unlimited number of bonds from the troubled nations if necessary. In early May, the ECB had already reduced interest rates in the eurozone to a new historic low of 0.5% in an attempt to kick-start the recovery. According to Draghi, this effect is now expected to gradually and very slowly materialise towards the end of the year. The ongoing uncertainty in the eurozone region was also felt in Germany during the second quarter of 2013. Although the IMF was still optimistically assuming growth of 0.6% for the full year in April, it downgraded its forecast to 0.3% after the first six months. The Institute believes that growth will be driven exclusively by domestic forces in both the current and coming years. Head of Business Cycle Analysis at the ifo Institute, Kai Carstensen, is somewhat more optimistic. Although the economic

Sector development In the first six months of 2013, the global IT market was unable to fully escape the effects of the downbeat economic mood around the world. According to the international market research institute IDC, IT expenditure already fell short of expectations in the first quarter of 2013. As a result, the institute reduced its growth forecast for global IT spending in 2013 from 5.5% at the beginning of the year to 4.9% in May 2013. The main culprit is falling demand for IT hardware. Demand for IT services, however, remains strong. The German Federal Association for Information Techno logy, Telecommunications and New Media (BITKOM) reports more positive figures for Germany. Its survey of market sentiment in July 2013 showed that most suppliers of information technology, telecommunication and entertainment electronics were satisfied with business in the first half-year. 57% succeeded in raising sales. Business was even better for IT service providers – 70% of whom reported increased revenues. This upbeat mood is expected to continue in the second half of the year. This is also reflected by the BITKOM Index, which remains high and continues to exceed expectations for the economy as a whole (ifo Index). According to the sector organisation, demand for skilled staff is still strong. 55% of companies believe the current situation represents an obstacle to further growth. The sector investing most heavily in IT is the financial services industry – also of particular importance to GFT. This was the conclusion of a survey conducted by Forrester Research Inc. examining companies in the Americas, Europe and Asia. One key reason was the level of compliance regulations requiring IT support.

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Consolidated Interim Management Report

Course of business Despite the ongoing weakness of the eurozone econo-

Due to the positive development of business and high

mies, the GFT Group can look back on a satisfactory first

utilisation of capacity in the GFT Solutions division, head-

six months to 2013. With consolidated revenue of

count at the Spanish development centres was increased

€114.19 million (prev. year: €116.38 million), the Group

strongly. GFT employed more than 1,500 full-time staff

fell 2% short of the prior-year figure. Adjusted for the

as of 30 June 2013.

planned reduction of revenue from its Third Party Management business amounting to €9.03 million, however, the Group’s core business grew by 6% in the first six months. Pre-tax earnings (EBT) increased by 46% to €5.50 million (prev. year: €3.78 million). This figure includes income of €1.18 million from the adjustment of the purchase price for A symo AG, Switzerland, acquired in 2011, as well as costs for the CODE_n12 innovation drive amounting to €0.90 million (prev. year: €1.32 million).

With the acquisition of an 80% stake in the company Sempla S.R.L., Milano, Italy, on 30 May 2013, the GFT Group took a further important step towards the internationalisation of its GFT Solutions division. Sempla is one of Italy’s leading IT consultancies, specialising in commercial and private banking. With its 460 employees, it generated revenue of over €44 million and pre-tax earnings of €4.08 million in 2012. Sempla’s product range fits well with the portfolio of GFT and adds top-quality

There was particularly encouraging growth in the GFT

consultancy know-how on the Italian market and acclaimed

Solutions division, which raised revenue by 14% to €69.14

expertise in the general banking sector. This provides

million (prev. year: €60.85 million). This positive develop-

synergies for the further development of the Italian market

ment was helped by increased compliance requirements

and offers GFT growth opportunities with existing and

for the finance sector as well as projects connected with

new clients in Europe and the USA. The acquisition of

the introduction of the Single Euro Payments Area (SEPA).

Sempla was closed on 3 July 2013 so that the effects from

The growing demand for outsourcing services, as well as

the takeover will become effective for the GFT Group’s

solutions for investment banking and mobile banking,

accounts as of the 3rd quarter of 2013.

boosted sales in the UK and Germany. Due to a high degree of capacity utilisation and positive margin effects, segment earnings rose by 63% to €6.93 million (prev. year: €4.25 million). The emagine division, whose realignment is continuing in 2013, posted revenue of €45.04 million – 19% down on the previous year (€55.53 million). Revenue from helping companies recruit IT and engineering specialists for technology projects fell by 2% to €43.70 million (prev. year: €44.59 million). The division’s low-margin Third Party Management business only contributed €1.34 million to segment revenue (prev. year: €10.94 million). In 2013, the planned reduction in revenue from this business will amount to around €15 million. Segment earnings of the emagine division were burdened by realignment costs and amounted to €0.00 million (prev. year: €1.15 million).

Q1–2–2013

gfT share following a slightly positive sideways movement in the

of €3.44 and subsequently climbed to a month-high

first quarter of 2013, the international stock markets were

of €3.64. On presentation of the latest company figures in

marked by strong volatility in the second quarter. Tension

May, this upward trend was solidified and continued. By

between North and south Korea as well as forecasts of

15 May, the share had reached a preliminary month-high

weaker growth for China and the global economy as a

price of €3.85. The dividend payout of €0.15 on the

whole put pressure on the leading indices during April.

following day had no effect on the further development.

The german blue-chip DAX index was also weakened by a

Compared to the preceding month, daily trading volumes

disappointing labour market report in late March and fell

were increased strongly and averaged 34,135 traded

below 7,600 points. After poor economic data and grow-

shares. The reporting month of May closed at €4.00 – an

ing eurozone unemployment had prompted the ECB to

increase of 12.99% over the prior-month closing rate.

reduce interest rates on 2 May, a turnaround was reached. The consequence was new record-highs on the world’s stock markets. On 3 May, the Dow Jones succeeded in breaking the 15,000-mark for the first time and the DAX (Performance Index) reached an all-time-high of 8,530.89 points on 22 May – after hitting new record levels on twelve successive days. This euphoria was dealt its first blow in early June, caused by concerns about the world’s second-largest economy: China. The us federal Reserve

This healthy upward trend also continued in June with the share reaching its highest level of the first half-year on 19 June. The price only weakened somewhat towards the end of the month. Although the reporting month June proved turbulent for the market as a whole, the gfT share closed at €4.09 – representing growth of 27% for the first six months.

also declared that it would only provide support to the

Shareholder structure

economy until us unemployment had fallen to 6.5%.

There were no changes in the shareholder structure of

Although ECB President Draghi gave assurances that there

gfT Technologies Aktiengesellschaft in the period under

were still sufficient funds to support markets, the EuRO

review. 28.08% of shares are still held by company

sTOXX, DAX and TecDAX indices fell strongly, while the

founder ulrich Dietz. Maria Dietz owns 9.68% of shares,

us markets suffered only moderate losses.

while former supervisory Board member Dr Markus Kerber

following growth of 6% in the first quarter, the gfT share was largely unaffected by the general market turbulence in

holds 5.00%. The free float portion comprises 57.24% of all gfT shares.

the second quarter. Despite the highly volatile stock market environment, the share succeeded in keeping its basic price above the moving average of the 38-day-line (€3.45).

Shareholder structure

The share started in April at the prior-month closing price

ulrich Dietz

28.08

Maria Dietz

9.68

Dr Markus Kerber free float

5.00 57.24

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Consolidated Interim Management Report

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Share performance indexed

130

Technology All Share Performance Index GFT share

100

2 January 2013 (closing price Xetra) €3.22 = 100%

28 June 2013 (closing price Xetra) €4.09

Information on the GFT share H1 2013

H1 2012

€3.22

€2.75

Closing quotation on 30 June (daily closing prices Xetra)

€4.09

€2.90

Percentage change

Year-opening quotation (daily closing prices Xetra)

+27%

+5%

Highest price (daily closing prices Xetra)

€4.20 (19/06/2013)

€3.20 (02/03/2012 13/–16/03/2012 20/–21/03/2012)

Lowest price (daily closing prices Xetra)

€3.20 (03/01/2013) (07/01/2013)

€2.75 (02/01/2012)

26,325,946

€107.67 million

€76.35 million

24,669

12,954

€0.17

€0.09

Number of shares on 30 June Market capitalisation on 30 June Average daily trading volume in shares (Xetra and Frankfurt) Earnings per share

ISIN

DE 0005800601

Initial stock market quotation

28/06/1999

Market segment

Prime Standard

Q1–2–2013

Development of revenue In the first six months of 2013, the gfT group generated

In the emagine division, revenue was 19% down on the

consolidated revenue of €114.19 million, some 2% below

previous year at €45.04 million for the first six months

the prior-year figure (€116.38 million). The planned reduc-

of 2013 (prev. year: €55.53 million). This figure includes

tion in low-margin Third Party Management business

the planned reduction of revenues in the lower-margin

amounted to €9.03 million in the first six months. Adjust-

Third Party Management business of €9.03 million. With

ed for this discontinued revenue contribution, the group’s

its consultancy services for the staffing of technology

core business grew by 6% year on year.

projects with highly skilled IT and engineering experts, the emagine division reported a decline in revenues of 2%

Revenue by segment

to €43.70 million (prev. year: €44.59 million). The division’s

The GFT Solutions division achieved revenue growth

low-margin Third Party Management business contributed

of 14% to €69.14 million (prev. year: €60.85 million) in the first six months of 2013. Revenues in this division were driven by growing compliance requirements in the finance sector and especially projects relating to the

€1.34 million (prev. year: €10.94 million) to segment revenue. All in all, this division’s share of consolidated revenue fell to 39% (prev. year: 48%).

introduction of the single Euro Payments Area (sEPA).

Revenue by country

growth was helped further by rising demand for solutions

The region Germany, which is affected most by the with-

in the field of investment banking and mobile banking.

drawal from Third Party Management business, reported a

The division’s share of consolidated revenue rose to 61%

fall in revenue of 10% to €40.18 million (prev. year: €44.72

(prev. year: 52%).

million). The gfT solutions division enjoyed strong growth. The region remained the gfT group’s largest sales market with a share of total revenue of 35% (prev. year: 38%).

Revenue by segment

Revenue by country

H1 2013

€ million

gfT solutions

61%

69.14

emagine

39%

45.04

0.01

Others

H1 2013

€ million

germany

35%

40.18

23%

25.94

france

18%

20.66

spain

12%

13.21

switzerland

4.37

usA

4.29

Other countries

5.54

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Consolidated Interim Management Report

The GFT Group recorded its strongest revenue growth in

Revenue by industry

the UK during the first half of 2013. Driven by strong

At the beginning of financial year 2013, revenue by industry

demand from the investment banking industry, revenues here rose by 43% to €25.94 million (prev. year: €18.11 million). This positive development was driven by both the GFT Solutions division and the emagine division. This

was reclassified in order to reflect business in the relevant target markets more transparently. Prior-year figures were adjusted accordingly.

region’s share of Group revenue rose to 23% (prev. year:

With a 64% share of the GFT Group’s total revenue (prev.

16%).

year: 61%), the financial service providers sector

Business in France also made encouraging progress. Strong demand for IT and engineering specialists in the industrial and service sectors helped raise revenue by 4% to €20.66 million (prev. year: €19.92 million). The region accounted for 18% (prev. year: 17%) of total Group revenue. In Spain, the GFT Group posted revenue of €13.21 million and was thus just 5% down on the previous year (€13.95 million). At 12%, the country’s contribution to total revenue remained unchanged (prev. year: 12%). Revenue generated in Switzerland amounted to €4.37 million, corresponding to a year-on-year decline of 29% (€6.19 million). The region’s share of Group revenue fell to 4% (prev. year: 5%). The decline is due to reduced capacity utilisation in the GFT Solutions division and the

remained the most important industry for GFT in the first half of 2013. Revenue losses from discontinued Third Party Management business were completely offset in this sector by strong revenue growth in the GFT Solutions segment. All in all, revenue in this sector increased by 2% to €72.66 million (prev. year: €70.96 million). The proportion of revenue contributed by the sector other service providers fell to 14% (prev. year: 17%). Revenues were down by 17% to €16.32 million (prev. year: €19.63 million) due to lower sales in both the emagine segment and GFT Solutions segment. Revenue in the other industries sector fell by 2% to €25.21 million (prev. year: €25.79 million) and accounted for 22% of Group sales (as in the previous year).

discontinuation of local emagine business in the third quarter of the previous year. In the USA, revenue fell by 28% to €4.29 million (prev. year: €5.96 million). Revenue from other countries reached €5.54 million (prev. year: €7.53 million), corresponding to a decline of 26%. Revenue by industry

H1 2013

€ million

Financial service providers

64%

72.66

Other industries

22%

25.21

Other service providers

14%

16.32

Q1–2–2013

Earnings position In the first six months of 2013, earnings before taxes

Consolidated earnings position by segment

(EBT) of the GFT Group amounted to €5.50 million and

In the first half of 2013, the earnings contribution of the

were thus 46% up on the previous year (€3.78 million).

GFT Solutions segment rose by 63% to €6.93 million

The operating margin before taxes improved strongly by

(prev. year: €4.25 million), corresponding to an increase in

1.5 %-points, from 3.3% in the previous year to 4.8%.

the operating margin to 10.0% (prev. year: 7.0%). This

These half-year figures include income from the adjust-

year-on-year rise in earnings results mainly from the very

ment of the expected remaining purchase payment for

positive development of business in the UK und Germany.

Asymo of €1.18 million.

Earnings of the emagine segment amounted to €0.00

Earnings before interest and taxes (EBIT) amounted

million after the first six months of 2013 (prev. year: €1.15

to €5.36 million in the first six months and were thus 46%

million). This figure was burdened by expenses involved

above the prior-year figure (€3.67 million). Earnings

with the division’s realignment and the establishment of

before interest, taxes, depreciation and amortisation

the brand in the target markets Germany, France and

(EBITDA) rose by 37% to €6.09 million (prev. year:

the UK. Due to reduced revenues and low earnings, the

€4.43 million).

operating margin deteriorated by 2 %-points (prev. year: 2.1%).

In the first half-year, the GFT Group generated earnings after taxes of €4.36 million, corresponding to year-on-year growth of 85% (€2.36 million). This strong improvement

The »others« category comprises balance sheet effects, costs of the holding company and consolidation amounts

benefited from a reduction in the calculated tax ratio from

which cannot be directly charged to either of the two

38% in the previous year to 21% in the first six months,

aforementioned divisions. At €-1.43 million, pre-tax earn-

as well as from improved earnings of the »others« division.

ings of this division were up 11% on the previous year (€-1.62 million). As in the previous year, the largest indi

Earnings per share rose by €0.08 to €0.17 (prev. year:

vidual item in this category was the cost for the CODE_n

€0.09 per share) based on 26,325,946 outstanding shares.

project and CeBIT fair presence.

Earnings by segment

GFT Solutions € million

emagine

Total

others

H1 2012

H1 2013

H1 2012

H1 2013

H1 2012

H1 2013

H1 2012

H1 2013

4.25

6.93

1.15

0.00

-1.62

-1.43

3.78

5.50

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Consolidated Interim Management Report

Consolidated earnings position by income and expense items

Other operating expenses rose by 8% to €13.00 million

In the first half of 2013, other operating income rose to

main cost elements are operating, administrative and

€2.42 million (prev. year: €1.46 million). This increase of €0.96 million was mainly due to the partial reversal of an earn-out provision for the Asymo acquisition as well as to other operating income. This other operating income was mostly generated via the CODE_n partnerships. The item cost of purchased services mainly comprising the use of external manpower – fell by €6.44 million to €48.55 million (prev. year: €54.99 million) due to lower revenues in the Third Party Management business and the related purchase of external employees. The cost of mater

in the first half of 2013 (prev. year: €12.00 million). The selling expenses, which rose by €0.79 million to €12.15 million (prev. year: €11.36 million). This item also includes exchange rate losses and other taxes. Income taxes amounted to €1.14 million in the first six months and were thus €0.28 million below the prior-year figure of €1.42 million. The calculated tax ratio fell strongly by 17 %-points to 21% (prev. year: 38%). This was due to a more even distribution of profits among the various national subsidiaries and the non-taxable adjustment to the Asymo earn-out provision during the reporting period.

ials ratio – the relationship between cost of materials and revenue – consequently fell year on year by 4 %-points to 43% (prev. year: 47%).

Financial position

In the reporting period, personnel expenses increased by €2.44 million to €48.86 million (prev. year: €46.42 million).

As of 30 June 2013, cash, cash equivalents and secur

As a proportion of revenue, personnel expenses were up

ities amounted to €27.71 million and were thus €12.71

slightly to 43% (prev. year: 40%). This increase of around

million below the corresponding figure at the end of 2012

3 %-points was a result of the strongly increased revenue

(€40.42 million). The decline resulted from a significant fall

share of the more labour-intensive GFT Solutions segment

in liquid funds, mainly due to the payment behaviour of

to 61% (prev. year: 52%) and the related increase in

certain clients, as well as from a reduction in payables of

headcount in this division during the first half of 2013.

€9.44 million to €26.47 million.

Depreciation of intangible and tangible assets fell

Due to the delayed receipt of payments, trade receivables

slightly to €0.73 million in the first six months of 2013

rose by €10.2 million to €54.41 million as of 30 June 2013.

(€0.76 million). As in previous periods, this item had only

At year-end 2012, the figure stood at €44.21 million.

a minor impact on ordinary operating profits.

Trade payables – consisting mainly of amounts owing to external employees – amounted to €16.69 million on 30 June 2013. This corresponds to a reduction of €3.14 million compared to 31 December 2012 (€19.83 million). Since the planned winding down of Third Party Management business last year, liabilities have remained relatively stable since the beginning of the year.

Q1–2–2013

Asset position Cash flows from operating activities amounted to

As of the beginning of 2013, the requirements of IAS 19

€-8.83 million (prev. year: €-5.55 million) after the first six

(revised) have been applied. As a consequence, actuarial

months. This difference is mainly due to the increase in

gains and losses must now be recognised in the balance

receivables. Changes in trade receivables fell by €9.52 mil-

sheet without an effect on profit or loss. This also necessi-

lion compared to the prior-year figure (€-0.91 million),

tated a retroactive adjustment of various balance sheet

which was affected by short-term positive items. This

items as of 31 December 2012. Further details on this top-

effect was partially offset by the strongly reduced change

ic are provided in the Notes to the Consolidated Interim

in trade payables and other liabilities, which amounted

Financial Statements.

to just €-1.33 million in the reporting period (prev. year: €-7.69 million).

The balance sheet total of the GFT Group increased

Working capital (the difference between current assets

of 30 June 2013. At the end of the financial year 2012,

and current liabilities) amounted to €36.97 million as of

the total had amounted to €132.48 million.

30 June 2013 and was thus €0.29 million below the year-

slightly by €1.08 million and stood at €133.56 million as

end 2012 figure of €37.26 million.

Compared to 31 December 2012 (€48.17 million), there

At €0.87 million, cash flows from investing activities

lion to €48.02 million. This was largely due to a shift in

were above the prior-year figure of €-0.57 million. The

certain items: a strong increase in tangible assets resulting

purchase of a new administration building in Stuttgart as

mainly from the purchase of the new administration

the Company’s future head office amounting to €1.9 mil-

building and a decrease in securities.

lion was offset by proceeds from the disposal of financial investments, which was also responsible for the strong improvement in cash flow of €1.44 million. This item also includes smaller investments in tangible assets, including IT procurements.

was a minor decrease in non-current assets of €0.15 mil-

As of 30 June 2013, current assets amounted to €85.54 million and were thus €1.23 million above their year-end 2012 level (€84.31 million). There was a sharp increase of €10.20 million in trade receivables to €54.41 million (31 December 2012: €44.21), which was opposed by a fall

As of 30 June 2013, cash flows from financing activ

in liquid funds of €9.44 million to €26.47 million (31 De-

ities amounted to €-1.35 million (prev. year: €-3.48 million).

cember 2012: €35.91 million).

This figure concerns the use of short-term credit lines by a foreign subsidiary.

At the end of the first half of 2013, equity amounted to €78.65 million and was thus €0.44 million above the corresponding figure on the balance sheet date of 31 December 2012 (€78.21 million). The change was mainly due to a reduction in the balance sheet loss from €-3.83 million to €-3.42 million. As a consequence of this marginal difference, the current equity ratio remains unchanged from 31 December 2012 at 59%.

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Consolidated Interim Management Report

Group balance sheet structure

ASSETS in € million

31/12/ 2012

30/06/ 2013

31/12/ 2012

EQUITY & LIABILITIES in € million

Cash, cash equivalents and securities

40.42

27.71

48.57

47.05

Current liabilities

Other current assets

47.08

57.95

6.34

7.22

Non-current liabilities

Other non-current assets

44.98

47.90

78.65

78.21

Equity capital

132.48

133.56

132.48

On the liabilities side, there was a rise in current liabil

There was only a slight change in non-current liabilities

ities of €1.52 million compared to 31 December 2012,

during the period under review. As of 30 June 2013, they

mainly due to the increase in financial liabilities of €2.60

stood at €6.34 million and were thus down by €0.88 mil-

million and in current income tax liabilities of €1.29 mil-

lion compared to year-end 2012. This decrease was due

lion. The increase in financial liabilities results from a short-

to a reversal of provisions.

term loan taken out by a subsidiary.

The equity/non-current assets ratio – the yardstick for

This was opposed by a decline in trade payables of €3.14

solid balance sheet structures – rose to 164% as of

million to €16.69 million. As of 31 December 2012, the

30 June 2013 (year-end 2012: 162%). This ratio expresses

figure had stood at €19.83 million.

the relationship between the balance sheet items »equity« and »non-current assets« and provides information about the Company’s financial stability.

Q1–2–2013

Employees

Research and development

As of 30 June 2013, the GFT Group employed a total of

The GFT Group invested a total of €1.02 million in research

1,503 people. This corresponds to an increase of 132 per-

and development during the reporting period (prev. year:

sons or 10% compared to the same date last year. Head-

€0.72 million).

count is calculated on the basis of full-time staff, whereby part-time staff are included on a pro rata basis.

The largest share of this total (€0.88 million or 86%) was accounted for by personnel expenses (prev. year: 75%). In

In the GFT Solutions division, the number of employees

the first six months of 2013, the GFT Group concentrated

rose by 11%: from 1,220 at the end of the first half of

its R&D efforts on the following strategic initiatives:

2012 to 1,360 on 30 June 2013. The strongest increase in headcount was in Spain (up 121 to 950 employees). The emagine division employed 94 people. The decrease of 11 persons corresponds to a 10% decline compared to the same date last year. The »others« category remained virtually unchanged at 49 employees, corresponding to a year-on-year increase of 3 persons or 7%.

At the SAP Competence Centre, experts develop tailored solutions for financial institutes, which help them integrate SAP software into their existing IT platform. One of the key topics in the first half of 2013 was the further development of possible uses for in-memory databases based on SAP HANA technology. This technology is integrated into client solutions in order to significantly reduce the comput-

As of 30 June 2013, 274 people were employed in Germa-

ing time for complex simulations, thus enhancing its use

ny (prev. year: 271). Comprising 1,229 persons, the pro-

in consultation sessions.

portion of GFT staff employed outside Germany amounted to 82% (prev. year: 80%).

Mobile Finance activities comprise the development of key applications for mobile devices in the financial services

Employees by country as of 30 June

sector. In the first six months, investments were made for example in development and integration services for the 2013

2012

Germany

274

271

field of Mobile Finance in order to design and implement tailored IT solutions and services for the finance sector.

Brazil

158

150

France

all R&D activities in the field of applied innovation manage

ment. Based on the open innovation approach, the

Switzerland

Applied Technologies Group initiates and coordinates inno-

Spain

950

829

USA

1,503

1,371

Total

In its internal Applied Technologies Group, GFT pools

vation projects in line with the current solution needs of our clients. In order to ensure consistently high quality in its global development efforts, software development processes were further optimised in accordance with the international

Employees by division as of 30 June

CMMI® (Capability Maturity Model Integration) standard. 2013

2012

1,360

1,220

emagine

105

Others

1,503

1,371

GFT Solutions

Total

The number of freelance staff fell year on year by 73 to 949 persons (-7%).

➜

❘

Consolidated Interim Management Report

Subsequent events

Forecast report

In an agreement dated 30 May 2013, GFT Holding Italy

Macroeconomic development

S.R.L., Milano, Italy, acquired an 80% stake in the Italian

According to the World Bank, the global economy will

IT service provider Sempla S.R.L. The acquisition of the company was closed on 3 July 2013 and GFT Holding Italy S.R.L. has controlled the acquired company since this date. Further information on this transaction is provided in the Consolidated Interim Financial Statements on page 35.

continue to gain stability but grow more slowly than expected. In its latest economic outlook of 12 June 2013, the Institute therefore downgraded its global forecast for 2013 from 2.4% to 2.2%. The experts pointed to a worse than expected recession in Europe and slower growth in major emerging nations, such as China, Brazil, India and

Opportunity and risk report

Russia, which had driven the global economy over the past years. For 2014, the World Bank now forecasts global growth of 3%, rising to 3.3% in 2015.

In the first six months of 2013, there were no material

In its World Economic Outlook published on 16 April 2013,

changes with regard to the comprehensive discussion of

the International Monetary Fund (IMF) is somewhat more

opportunities and risks provided in the Management

optimistic with a forecast for global economic growth of

Report accompanying the Consolidated Financial State-

3.5% in 2013 and 4% in 2014. Europe is still the main risk

ments for 2012. The risk position of the GFT Group is

for global financial stability following its five rescue pack-

thus unchanged.

ages for member states so far. The IMF forecasts an overall decline in output for the eurozone of 0.3% in the current year and slight growth of 1.1% in 2014. In its Germany Report of 2 June 2013, the IMF downgraded its 2013 forecast of April from 0.6% to just 0.3% with reference to the ongoing uncertainty of the eurozone region. At the same time, however, the IMF claimed that the German financial sector had gained in solidity and resistance compared to the past.

Q1–2–2013

Sector development

In Germany, BITKOM believes that the German ICT market

In its latest forecast of 2 July 2013, the market research

will easily outpace the overall economy again with growth

institute Gartner downgraded its growth outlook for glo bal IT spending in 2013 from 4.1% to 2%. Gartner states that the strong downgrade is mainly due to fluctuations in dollar exchange rates. If exchange rates had remained stable, the revised growth forecast would have been 3.5%. Whereas spending growth is set to decline in most regions, the analysts see a slight increase in Western Europe. Des pite the adverse economic outlook, there are still strategic IT initiatives in this region. For the coming year, growth in global IT spending is expected to pick up again and reach 4.1%. In its banking industry survey of 16 July 2013, Gartner expects growth in IT spending to exceed the general market level at 2.5% for the current year. In the second quarter, the market researchers of IDC also downgraded their 5.5% forecast for global IT spending made at the beginning of the year. In their forecast update of 15 May 2013, they now predict an increase in IT expenditure of 4.9%. In addition to the ongoing global uncertainty regarding future economic development, the IDC experts also foresee falling demand for IT hardware.

of 1.4% to €153 billion. According to the BITKOM forecast, the IT services business (projects, consulting and outsourcing) will grow by 2.5% to around €36 billion in the current year, following growth of 2.1% in the previous year. Following a strong first half-year, the German hightech industry is confident about its prospects for the remaining months. According to the sector barometer of 15 July 2013, around three quarters of all suppliers of information technology, telecommunication and entertainment electronics expect rising revenues in the six months ahead.

Revenue and earnings forecast Following a first six months in line with expectations, the GFT Group is upholding its positive assessment of business prospects for the financial year 2013 – in spite of the eurozone’s continuing weakness. Due to the acquisition of a leading Italian IT service provider, the Executive Board has raised its forecast for revenue and earnings for 2013 as a whole.

According to IDC, however, demand for IT services will

The GFT Solutions division is dedicated to delivering IT

remain strong.

solutions for the finance sector and the Executive Board

The industry association BITKOM believes that the hightech industry will continue to be an important driver of the global economy in 2013. According to its latest economic outlook of 4 March 2013, the global market for products and services in the IT and telecommunication sector is expected to grow this year by 5.1% to €2.7 trillion. With a share of 21.8% and expected growth of 0.9%, the EU is still the second-largest ICT market after the USA with growth of 6.5% and a share of 26.8%.

expects further solid organic growth for this business in the remaining six months, as well as a strong growth impetus from the acquisition of the Italian company Sempla. As of the second half of 2013, GFT Solutions will be present in Europe’s fourth-largest IT market with some 500 employees, offering its extended portfolio of solutions to existing and new clients on the Italian market. GFT Solutions expects further growth opportunities from the positioning of selected competencies of Sempla – especially its expertise in general banking – with its European clients.

➜

❘

Consolidated Interim Management Report

In the second half of 2013, demand for IT solutions to op-

and Mobile Technologies, in order to tap new growth

timise core banking systems and implement new compli-

fields. In the field of engineering, emagine expects growth

ance regulations in the banking sector will continue to rise.

to be driven by a rising demand for highly skilled engineers

One key driver will be the introduction of the single Euro

in the field of plant and machine construction, as well as

Payments Area (sEPA), which according to Eu ordinance

renewable energies. In the current financial year, emagine

must have been completed by 1 february 2014. further

will not be able to fully compensate for revenue losses

growth is expected to arise from increased competition in

from the further reduction of its low-margin Third Party

the finance sector. Established banks will face the chal-

Management business. In 2013, the emagine division will

lenge of adapting their business models to new technologi-

also be burdened by costs for repositioning business under

cal developments. The Executive Board therefore expects

its own brand and for the realignment of its internal struc-

banks to invest increasingly in new technologies for mobile

tures.

payments and to use social media functionalities in the banking business. In the field of mobile banking, financial institutes will invest increasingly in intelligent and userfriendly security solutions. further growth opportunities will arise from the acquired consulting expertise and expanded solution portfolio in general banking of sempla.

following the scheduled progress of business in the first half of the year, the Executive Board raised its revenue forecast for the financial year 2013 from €238 million to at least €260 million with the announcement of the sempla acquisition on 30 May 2013. The Executive Board now expects earnings before taxes (EBT) to reach at least €15

The emagine division will continue to drive its realignment

million (formerly €12 to €13 million). Earnings before

as an expert for staffing technology projects with IT and

interest, taxes, depreciation and amortisation (EBITDA) are

engineering specialists in 2013. The division is focusing on

expected to reach at least €19 million. for the financial

those growth industries in germany, france and the uK

year 2015, the Executive Board continues to expect group

which are expected to profit most from an economic

revenue of around €400 million and an operating pre-tax

upturn in the coming years. In the field of IT, emagine will

profit margin of over 6%. The underlying business plan

concentrate on future topics and technology trends such

assumes steady organic growth in combination with

as Big Data, Business Intelligence, social Media, IT security

targeted acquisitions in both business divisions.

Stuttgart, 6 August 2013 gfT Technologies Aktiengesellschaft The Executive Board

Ulrich Dietz

Jean-François Bodin

Marika Lulay

Dr. Jochen Ruetz

Chairman of the Executive Board

Member of the Executive Board

Q1–2–2013

Consolidated Income Statement for the period from 1 January to 30 June 2013, IFRS GFT Technologies Aktiengesellschaft, Stuttgart (not certified)

Half-year

€

Revenue Other operating income

Costs of purchased services

Second quarter

01/01/– 30/06/2013

01/01/– 30/06/2012

01/04/– 30/06/2013

01/04/– 30/06/2012

114,187,567.49

116,382,223.48

58,677,211.51

58,732,695.09

2,419,032.24

1,459,466.23

1,411,855.00

475,306.04

116,606,599.73

117,841,689.71

60,089,066.51

59,208,001.13

48,551,814.16

54,990,146.54

24,338,538.58

27,520,553.68

40,763,972.68

39,095,860.22

21,249,425.92

19,491,095.98

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

8,100,583.85

7,321,879.99

4,285,749.15

3,697,032.99

48,864,556.53

46,417,740.21

25,535,175.07

23,188,128.97

727,098.59

763,090.09

371,509.67

392,554.19

12,998,010.60

11,999,147.35

5,880,852.79

5,573,747.07

5,465,119.85

3,671,565.52

3,962,990.40

2,533,017.22

213,997.31

238,602.13

119,136.99

107,485.56

-1,931.42

-12,310.54

-8,428.54

-15,260.48

105,370.88

0.00

105,370.88

0.00

Interest and similar expenses

72,175.84

115,246.54

16,051.87

112,161.55

Financial result

34,519.17

111,045.05

-10,714.30

-19,936.47

Earnings before taxes

5,499,639.02

3,782,610.57

3,952,276.10

2,513,080.75

Taxes on income and earnings

1,140,375.94

1,422,341.54

735,718.40

778,700.58

Net income

4,359,263.08

2,360,269.03

3,216,557.70

1,734,380.17

Net earnings per share – undiluted

0.17

0.09

0.12

0.07

Net earnings per share – diluted

0.17

0.09

0.12

0.07

Depreciation on securities

➜

❘

Consolidated Interim Financial Statements

Consolidated Statement of comprehensive INCOME for the period from 1 January to 30 June 2013, IFRS GFT Technologies Aktiengesellschaft, Stuttgart (not certified)

Half-year

€

Second quarter

01/01/– 30/06/2013

01/01/– 30/06/2012

01/04/– 30/06/2013

01/04/– 30/06/2012

4,359,263.08

2,360,269.03

3,216,557.70

1,734,380.17

Actuarial gains/losses

0.00

-814,216.85

0.00

-408,661.30

Income taxes on components of other result

0.00

225,344.94

0.00

111,789.39

Other (partial) result A.)

0.00

-588,871.91

0.00

-296,871.91

302,316.16

72,770.75

301,817.54

-186,957.03

302,316.16

72,770.75

301,817.54

-186,957.03

-229,881.24

366,860.49

-278,476.88

324,286.22

-229,881.24

366,860.49

-278,476.88

324,286.22

Net income

A.) Components never reclassified to the income statement

B.) Components that can be reclassified to the income statement Financial assets available for sale (securities): – C hange of fair value recognised in equity during the financial year

Exchange differences on translating foreign operations: – Profits/losses during the financial year

Income taxes on components of other result

-69,389.21

0.00

-69,249.59

0.00

Other (partial) result B.)

3,045.71

439,631.24

-45,908.93

137,329.19

Other result

3,045.71

-149,240.67

-45,908.93

-159,542.72

4,362,308.79

2,211,028.36

3,170,648.77

1,574,837.45

Total result

Q1–2–2013

Consolidated Balance Sheet as at 30 June 2013, IFRS GFT Technologies Aktiengesellschaft, Stuttgart (not certified) Assets €

30/06/2013

31/12/2012 adjusted*

638,035.70

737,212.65

35,836,429.16

35,949,217.28

5,408,720.97

3,208,376.73

118,130.45

3,189,680.45

28,259.90

30,191.32

Non-current assets Intangible assets Goodwill Tangible assets Securities Financial assets, accounted for using the equity method Other financial assets

608,660.88

410,502.75

Current tax assets

415,212.93

Deferred tax assets

4,961,584.85

4,231,941.18

48,015,097.84

48,172,335.29

Current assets 54,409,484.07

44,206,480.67

Securities

Trade receivables

1,120,000.00

1,316,100.00

Current tax assets

1,007,274.92

918,103.24

26,472,302.14

35,911,786.55

790,128.73

416,363.25

Cash and cash equivalents Others Other assets

* We refer to Note 1 of the Consolidated Interim Financial Statements.

1,741,814.06

1,542,577.73

85,541,003.92

84,311,411.44

133,556,101.76

132,483,746.73

➜

❘

Consolidated Interim Financial Statements

Shareholders‘ Equity and Liabilities €

30/06/2013

31/12/2012 adjusted*

26,325,946.00

Shareholders‘ equity Share capital Capital reserve

42,147,782.15

Retained earnings

15,243,349.97

-1,864,860.99

-1,891,432.39

Changes in equity not affecting net income Actuarial gains/losses Foreign currency translations Reserve of market assessment for securities Consolidated balance sheet loss

349,061.86

578,943.10

-130,896.00

-363,822.95

-3,416,976.05

-3,827,347.23

78,653,406.94

78,213,418.65

Provisions for pensions

3,812,799.70

3,687,637.36

Other provisions

2,181,945.68

2,934,677.79

340,639.20

593,418.42

6,335,384.58

7,215,733.57

18,244,794.36

18,089,885.88

2,039,459.65

752,481.50

Liabilities Non-current liabilities

Deferred tax liabilities

Current liabilities Other provisions Current income tax liabilities Financial liabilities Trade payables Other financial liabilities Other liabilities

* We refer to Note 1 of the Consolidated Interim Financial Statements.

2,595,562.47

0.00

16,689,891.73

19,834,818.88

675,940.55

685,418.71

8,321,661.48

7,691,989.54

48,567,310.24

47,054,594.51

133,556,101.76

132,483,746.73

Q1–2–2013

Consolidated Statement of Changes in Equity as at 30 June 2013, IFRS GFT Technologies Aktiengesellschaft, Stuttgart (not certified)

€

Notes

Subscribed

Capital

Retained

capital

reserve

earnings Other retained earnings

As at 01/01/2012

Retroactive adjustment acc. to IAS 19R

Adjusted amount 01/01/2012

26,325,946.00

42,147,782.15

12,743,349.95

26,325,946.00

42,147,782.15

12,743,349.95

26,325,946.00

42,147,782.15

12,743,349.95

26,325,946.00

42,147,782.15

15,243,349.97

26,325,946.00

42,147,782.15

15,243,349.97

26,325,946.00

42,147,782.15

15,243,349.97

Retroactive adjustment acc. to IAS 19R

Dividend payment May 2012

Total income and expenses for the period 01/01/–30/06/2012

As at 30/06/2012

As at 01/01/2013

Retroactive adjustment acc. to IAS 19R

Adjusted amount 01/01/2013

Effects from IAS 19R

Dividend payment May 2013

Total income and expenses for the period 01/01/–30/06/2013

As at 30/06/2013 * Net income

â&#x17E;&#x153;

Other result

â?&#x2DC;

Consolidated Interim Financial Statements

Consolidated

Total

balance sheet

share capital

loss Foreign

Market

Actuarial gains/losses

currency

assessment

translations

for securities

728,294.52

-615,885.24

0.00

-5,713,702.92

-720,874.64

728,294.52

-615,885.24

-720,874.64

75,615,784.46

-720,874.64

-5,713,702.92

-588,871.91

74,894,909.82

-588,871.91

-3,948,891.90

2,360,269.03*

2,799,900.27

366,860.49

72,770.75

1,095,155.01

-543,114.49

-1,309,746.55

-7,302,325.79

73,157,046.28

578,943.10

-363,822.95

0.00

-3,827,347.23

80,104,851.04

-1,891,432.39

0.00

-1,891,432.39

-3,827,347.23

78,213,418.65

578,943.10

-363,822.95

26,571.40

0.00

-3,948,891.90

-229,881.24

232,926.95

0.00

4,359,263.08*

4,362,308.79

349,061.86

-130,896.00

-1,864,860.99

-3,416,976.05

78,653,406.94

Q1–2–2013

Consolidated cash flow statement for the period from 1 January to 30 June 2013, IFRS GFT Technologies Aktiengesellschaft, Stuttgart (not certified)

Half-year

€

01/01/– 30/06/2013

01/01/– 30/06/2012

Net income

4,359,263.08

2,360,269.03

Taxes on income and earnings

Notes

1,140,375.94

1,422,341.54

Interest income

-34,519.17

-110,145.05

Interest paid

-11,144.17

-4,071.58

-1,182,937.65

-1,655,063.07

727,098.59

763,090.09

Income taxes paid Depreciation on intangible and tangible assets Changes in provisions Other non-cash expenses/income Profit from the disposal of tangible and intangible assets as well as financial assets

-352,217.80

906,466.68

94,289.10

300,380.06

-41,628.72

4,551.00

-10,426,760.11

-907,531.17

Changes in other assets

-1,770,710.31

-946,453.26

Changes in trade liabilities and other liabilities

-1,331,671.13

-7,688,729.53

Cash flow from operating activities

-8,830,562.35

-5,554,895.26

Changes in trade receivables

Cash receipts from sales of tangible assets Cash payments to acquire tangible assets Cash payments to acquire non-current intangible assets Cash receipts from sales of financial assets

7,000.00

0.00

-2,792,829.47

-638,241.00

-71,023.10

-162,186.73

3,517,950.00

0.00

Interest received

211,737.56

230,151.55

Cash flow from investing activities

872,834.99

-570,276.18

2,595,562.47

464,399.51

Payments to shareholders

-3,948,891.90

Cash flow from financing activities

-1,353,329.43

-3,484,492.39

-128,427.62

115,493.07

Change in cash funds from cash-relevant transactions

-9,439,484.41

-9,494,170.76

Cash funds at the beginning of the period

35,911,786.55

32,472,593.37

Cash funds at the end of the period

26,472,302.14

22,978,422.61

Cash receipts from taking out short-term or long-term loans

Effect of exchange rate changes on cash and cash equivalents

➜

❘

Notes

Notes to the CONSOLIDATED Interim Financial Statements as at 30 June 2013, IFRS GFT Technologies Aktiengesellschaft, Stuttgart (not certified)

1. Fundamentals for the GFT Group’s Interim Financial Statements

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

These unaudited Interim Financial Statements of GFT Technologies

Mandatory retrospective application in accordance with IAS 19R has

Aktiengesellschaft (GFT AG) and its subsidiaries have been prepared in

resulted in the following changes to balance sheet items as at 31 Decem-

accordance with section 37w (3) of the German Securities Trading Act

ber 2012:

(WpHG) and International Accounting Standard (IAS) 34 – Interim Finan-

Effects on the Consolidated Balance Sheet from the amendment of IAS 19

cial Reporting. Compared to the Annual Financial Statements as at 31 December 2012, the Interim Financial Statements include condensed reporting in the Notes to the Financial Statements and comply with the International Reporting Standards (IFRS) as adopted by the European Union. With the exception of the changes stated below, the same accounting and valuation methods were used in these Interim Financial Statements

31/12/2012

01/01/2012

Equity

1,891.43

-720.87

Pension provisions

2,612.14

996.29

-720.71

-275.42

€ thsd.

Balance of deferred taxes

as in the last Consolidated Financial Statements as at 31 December 2012. New or amended standards and interpretations to be applied as of

The effects on the Consolidated Income Statement for the first six

the beginning of the financial year 2013 had the following impact on

months of financial year 2012 are only minor. There was no change in

the Interim Financial Statements:

earnings per share.

In June 2011, the IASB published amendments to IAS 19 »Employee

Maintaining the old version of IAS 19 would have resulted in the follow-

Benefits« which were adopted by the EU in June 2012. Application of

ing changes to the Consolidated Balance Sheet and Consolidated

the amended standard is mandatory for all financial statements prepared

Income Statement:

for financial years beginning on or after 1 January 2013, and thus for

Effects on the Consolidated Balance Sheet from the maintenance of IAS 19

the first time in the current financial year. The Group previously recognised pensions and similar obligations according to the corridor approach. With the mandatory adoption of

€ thsd.

30/06/2013

IAS 19 revised as of 2013, the corridor approach is no longer to be

Equity

used and actuarial gains and losses are now recognised in other compre-

Pension provisions

-72.22

hensive income.

Balance of deferred taxes

-19.86

This leads to an increase in provisions for pensions and similar obliga-

Effects on the Consolidated Income Statement from the maintenance of IAS 19

tions as well as a decrease in equity. The Consolidated Income Statement will no longer contain actuarial gains and losses in future as these are now recognised in other compre-

€ thsd.

52.36

30/06/2013

hensive income.

EBT

72.22

A further change is the introduction of the net interest rate. Net pension

Interest result

35.57

obligations are discounted with the underlying interest rate used for

Income taxes

9.78

the valuation of gross pension obligations.

Group result

62.44

There would also have been no change in earnings per share as of the first six months of financial year 2013.

Q1–2–2013

Other comprehensive income was disclosed for the first time according

of the cash flow statement. Moreover, the item »Other changes in equi-

to IAS 1.82A. The effects mainly concerned the disclosure of actuarial

ty«, which includes currency translation differences of subsidiaries, was

gains and losses in other comprehensive income, which are never reclas-

distributed among the changes in assets and liabilities in the reporting

sified to the income statement.

period while currency translation differences in cash and cash equiva-

Other new and revised standards to be adopted as of 1 January 2013

lents were disclosed separately.

(IAS 12/IFRS 7/IFRS 13) have no material impact on the Interim Financial

In drawing up these Interim Financial Statements, the Executive Board

Statements.

made estimations concerning the application and interpretation of

In financial year 2012, the structure of the cash flow statement was amended in accordance with IAS 1.41 in order to improve presentation. The amounts for taxes paid and interest paid and received disclosed in the footnotes of the previous year were integrated into the calculation

accounting regulations. Actual events may differ from these estimations. Future developments and results depend on a number of external factors involving risks and uncertainties, and are based on current assumptions which may prove inaccurate.

2. Changes to the consolidated Group and its associated companies

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

The following changes to the scope of consolidation have occurred

As a consequence, the payment obligation owed to the former share-

since the Consolidated Financial Statements were closed on 31 Decem-

holders has fallen to €1,851 thousand. The obligation is to be settled in

ber 2012:

two tranches in the 3rd quarter of 2013 and 2014, respectively.

On 26 February 2013, GFT Technologies Aktiengesellschaft, Stuttgart,

In the course of the Two Brand Strategy, the following changes to com-

purchased Neckarsee 283. VV GmbH. On 21 March 2013, the company’s

pany names were made in January 2013:

name was changed to GFT Beteiligungs-GmbH. Its initial consolidation did not have any major effect on the Group’s assets, financial and earnings position. GFT Holding Italy S.R.L, Milan, Italy, was founded by GFT Technologies Aktiengesellschaft, Stuttgart, on 16 May 2013. The company’s share capital amounts to €10 thousand and was fully paid on 6 May 2013. The company’s initial consolidation had no material impact on the Group’s assets, financial and earnings position.

a) emagine GmbH was renamed as emagine TPM GmbH as of 23 January 2013. b) GFT Resource Management GmbH was renamed as emagine GmbH as of 13 February 2013. c) GFT Flexwork GmbH was renamed as emagine Flexwork GmbH was renamed as of 11 January 2013. d) GFT Technologies S.A.R.L. was renamed as emagine S.A.R.L. as of

In the first six months of financial year 2013, the following adjustment was made to the outstanding obligation from the acquisition of GFT Financial Solutions AG, Opfikon, Switzerland, due to a change in the expected value resulting from reduced earnings expectations:

8 January 2013. The registered office and purpose of the companies did not change as a result of the name changes. In accordance with the merger agreement of 22 April 2013, emagine TPM GmbH, Eschborn, was merged with emagine GmbH, Eschborn, with

€ thsd.

Carrying value as of 1 January 2013 Adjustment of conditional consideration Carrying value as of 30 June 2013

3,133 -1,282 1,851

effect from 26 June 2013. The merger had no effect on the Group’s assets, financial and earnings position.

➜

3. Changes in equity

❘

Notes

For the changes in equity capital between 1 January 2013 and 30 June

the parent company GFT Technologies Aktiengesellschaft. In accordance

2013, we refer to the Consolidated Statement of Changes in Equity

with the adopted resolution of the Annual General Meeting of 15 May 2013, a dividend of €0.15 per share was distributed to shareholders,

which is disclosed separately. As of 30 June 2013, the Company’s share capital of €26,325,946.00 consists of 26,325,946 non-par value individual share certificates

totalling €3,949 thousand, from the balance sheet profit of the parent company GFT Technologies Aktiengesellschaft.

(no change relative to 31 December 2012). These shares are bearer

There were no changes in Authorised Capital or Conditional Capital in

shares and all grant equal rights.

the period 1 January 2013 to 30 June 2013 compared to 31 December

In June 2012, a dividend of €0.15 per share was distributed to shareholders, totalling €3,949 thousand, from the balance sheet profit of

4. Segment reporting

2012. As of 30 June 2013, GFT Technologies Aktiengesellschaft did not hold any of its own shares, nor did it purchase or sell any of its own shares in the period 1 January 2013 to 30 June 2013.

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

GFT has identified the two segments GFT Solutions and emagine as

As a general rule, the assets of the segments include all assets, except

reportable segments. The identification of these segments was mainly

for those from income tax and assets attributed to the holding activity.

based on the fact that the products and services offered in these seg-

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

ments show differences, and that the GFT Group is organised, managed

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

and controlled on the basis of these segments. Internal reporting to the Executive Board is based on the classification of Group activities in these segments. The products and services with which the reportable segments generate their income can be characterised as follows: all activities in connection with IT solutions (services and projects) are aggregated in the GFT Solutions segment. The emagine segment focuses on the placement of freelance IT specialists. Internal controlling and reporting within the GFT Group, and thus also segment reporting, is based on IFRS accounting principles as applied in the Consolidated Financial Statements. The GFT Group measures the success of its segments by means of segment EBT (earnings before tax). Segment income and results also include transactions between the segments. Intersegment transactions take place at market prices on an arm’s length principle.

For detailed information about the business segments, please refer to the following table. It also includes disclosures concerning revenue from external clients for each group of comparable products and services.

Q1–2–2013

information on business segments – Segment report GFT Technologies Aktiengesellschaft, Stuttgart (not certified)

GFT Solutions

€ thsd.

External sales Inter-segment sales Total revenues

Scheduled depreciation Significant 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 Shares in associated companies reported according to the equity method Investments in non-current intangible and tangible assets

Segment liabilities

emagine

30/06/2013

30/06/2012

30/06/2013

30/06/2012

69,137

60,849

45,035

55,533

295

642

2,288

69,432

60,862

45,677

57,821

-582

-578

-90

-158

-58

-32

-63

-70

-13

-2

-13

6,928

4,252

1,146

90,864

77,827

31,861

38,748

872

684

29,630

29,752

18,104

24,936

➜

Total

Eliminations

❘

Notes

Consolidated

30/06/2013

30/06/2012

30/06/2013

30/06/2012

30/06/2013

30/06/2012

114,172

116,382

114,188

116,382

937

2,301

-937

-2,301

115,109

118,683

-921

-2,301

114,188

116,382

-672

-736

-55

-27

-727

-763

-58

-32

-36

-268

-94

-300

160

190

214

239

-76

-83

-32

-72

-115

-2

-13

-2

-13

6,931

5,398

-1,431

-1,615

5,500

3,783

122,725

116,575

10,831

14,138

133,556

130,713

885

775

1,978

2,864

800

47,734

54,688

7,169

2,868

54,903

57,556

Q1–2–2013

The reconciliation of the segment figures to the corresponding figures in the Consolidated Financial Statements is as follows:

€ thsd.

Total segment revenue Occasionally occurring 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 Other Group result before taxes

€ thsd.

Total segment assets Non-attributed assets of Group HQ

01/01/– 31/06/2013

01/01/– 31/06/2012 adjusted*

115,109

118,683

-937

-2,301

114,188

116,382

6,931

5,398

-876

-2,500

876

-555

5,500

3,783

30/06/2013

30/06/2012

122,725

116,575

114

116

Securities

1,238

7,426

Assets from income taxes

6,679

6,447

Other Group assets

Total segment liabilities Non-attributed liabilities of Group HQ Liabilities from income taxes Other Group liabilities * We refer to Note 1 of the Consolidated Interim Financial Statements.

The reconciliation discloses items which per definition are not components of the segments. Non-attributed items of Group HQ, e.g. from centrally managed issues, are also included. Business transactions between the segments are also eliminated in the reconciliation.

Due to reduced earnings expectations for GFT Financial Solutions AG, as described in point 2, the segment liabilities of GFT Solutions were reduced by €1,282 thousand.

2,800

149

133,556

130,713

47,734

54,688

198

322

5,272

2,114

1,699

432

54,903

57,556

➜

❘

Notes

The table below shows information according to geographic regions for the GFT Group:

Revenue from sales to external clients*

Non-current intangible and tangible assets

in € million

01/01/– 30/06/2013

01/01/– 30/06/2012

30/06/2013

30/06/2012

Germany

40.18

44.72

34.84

32.67

25.94

18.11

0.03

0.07

Spain

13.21

13.95

1.35

1.21

France

20.66

19.92

0.08

0.10

USA

4.29

5.96

5.15

5.33

Switzerland

4.37

6.19

0.09

0.38

Other countries

5.54

7.53

0.34

0.29

114.19

116.38

41.88

40.05

Total *

Determined by client location

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

Revenue

Segments in which this revenue is generated

in € million

Client 1

5. Changes to contingent liabilities

01/01/– 30/06/2012

01/01/– 30/06/2013

01/01/– 30/06/2012

44.20

36.26

GFT Solutions, emagine

As of 30 June 2013, there were no significant changes to contingencies and other financial commitments compared to the Consolidated Financial Statements as at 31 December 2012. As at 31 December 2012, there were no contingent receivables.

01/01/– 30/06/2013

Q1–2–2013

INFORMATION ON FINANCIAL INSTRUMENTS ACCORDING TO CLASSES (not certified)

30/06/2013

€ thsd.

Valued at

Valued at fair value

Carrying

amortised cost

amount in the balance sheet

Carrying

Fair

Carrying

amount

value

amount

Fair value

Level 1 1

Level 2 2

Level 3 3

Financial assets Receivables from goods and services rendered

Loans and receivables

49,295

Amounts due from customers for construction work

Loans and receivables

5,115

Securities held as non-current assets Fixed-interest securities

Available-for-sale financial assets

Variable-interest securities

Financial assets measured at fair value through profit or loss and classified as such upon initial recognition

Securities held as current assets Variable-interest securities

Available-for-sale financial assets

Variable-interest securities

Financial assets measured at fair value through profit or loss and classified as such upon initial recognition

118

1,120

Cash and cash equivalents

Loans and receivables

26,472

Other long-term assets

Loans and receivables

609

Other short-term assets

Loans and receivables

Total financial assets

416

81,907

416 1,238

1,238

83,145

Available-for-sale financial assets

1,120

Financial assets measured at fair value through profit or loss

118

Loans and receivables

Fair values were measured on the basis of quoted prices (unadjusted) in active markets for identical assets or liabilities.

Fair values were measured on the basis of inputs other than quoted prices included within level 1 that are observable for the asset or liability, either directly (i.e. as prices) or indirectly (i.e. derived from prices).

Fair values were measured on the basis of inputs for the asset or liability that are not based on observable market data (unobservable inputs).

â&#x17E;&#x153;

31/12/2012 Valued at

Valued at fair value

Carrying

amortised cost

amount in the balance sheet

Carrying

Fair

Carrying

amount

value

amount

Fair value

Level 1 1

Level 2 2

Level 3 3

40,351

3,855

3,855 3,189

3,189

3,071

118

1,316

861

455

35,912

411

416

80,945

416 4,505

4,505

85,450

3,932

573

â?&#x2DC;

Notes

Q1–2–2013

30/06/2013

€ thsd.

Valued at

Valued at fair value

Carrying

amortised cost

amount in the balance sheet

Carrying

Fair

Carrying

amount

value

amount

Fair value

Level 1 1

Level 2 2

Level 3 3

Financial liabilities Financial liabilities

Financial liabilities valued at amortised cost

2,596

Trade liabilities

Valued at amortised cost

16,690

Other liabilities

Valued at amortised cost

676

Financial liabilities from subsequent purchase price payments

Valued at amortised cost

2,209

Total financial liabilities Financial liabilities valued at amortised cost

22,171

Fair values were measured on the basis of quoted prices (unadjusted) in active markets for identical assets or liabilities.

Fair values were measured on the basis of inputs for the asset or liability that are not based on observable market data (unobservable inputs).

â&#x17E;&#x153;

â?&#x2DC;

31/12/2012 Valued at

Valued at fair value

Carrying

amortised cost

amount in the balance sheet

Carrying

Fair

Carrying

amount

value

amount

Fair value

Level 1 1

Level 2 2

Level 3 3

19,835

685

3,671

24,191

Notes

Q1–2–2013

6. Reporting on financial instruments

Information on financial instruments according to categories The table on pages 30 –33 of the Notes to the Interim Financial State-

the carrying amounts on the balance sheet date do not vary significantly from the fair value.

ments show the carrying amounts and the fair value of the individual

Financial instruments stated in the balance sheet at fair value can be

financial assets and liabilities for each individual class of financial instru-

classified according to the following hierarchy which reflects to which

ments, and transfers them to the corresponding balance sheet items.

extent the fair value is observable:

The fair value of a financial instrument is the price at which a party

Level 1: measurement at fair value on the basis of quoted prices (un

would take on the rights and/or obligations from this financial instru-

adjusted) in active markets for identical assets or liabilities.

ment from an independent, contractually-willing other party.

Level 2: measurement at fair value using inputs other than quoted prices

In the case of financial instruments to be accounted for at fair value, the

included within Level 1 that are observable for the asset or liability, either

fair value is determined on the basis of market prices. If no market prices

directly (i.e. as prices) or indirectly (i.e. derived from prices).

are available, a valuation is carried out using typical valuation methods based on instrument-specific market parameters. The fair value of loans and receivables and of original liabilities is determined as the present value of future cash inflows or outflows, discounted at a current interest rate on the balance sheet date taking into account the respective due date of the asset items or the residual term of the

Level 3: measurement at fair value based on inputs for the asset or liability that are not based on observable market data (unobservable inputs). Quantitative disclosures for financial instruments stated in the balance sheet at fair value are included in the table on pages 30 –33 of the Notes to the Interim Financial Statements.

liability. Owing to the mainly short maturity term of trade payables and

As in the previous period, no reclassifications between the three levels

receivables, other receivables and liabilities and cash and cash equivalents,

were made during the current financial year.

7. Investments/disinvestments

During the period 1 January to 30 June 2013, the GFT Group invested €71 thousand in intangible assets (1 January – 30 June 2012: €162 thousand) and €2,793 thousand in tangible assets (1 January – 30 June 2012: €638 thousand). There were no significant disinvestments in the reporting period. Additions to non-current tangible assets mainly refer to the purchase of an administration building totalling €1,950 thousand.

➜

8. Related party disclosures

❘

Notes

Compared to the disclosures made in the Notes to the Consolidated financial statements as at 31 December 2012, there were no significant changes in related party disclosures. There were also no changes in the composition of related parties nor in relations with such parties.

9. Events after 30 June 2013

In an agreement dated 30 May 2013, gfT holding Italy s.R.l., Milan, Italy, acquired an 80% stake in the Italian IT service provider sempla s.R.l.,

b) Expected synergies between gfT and sempla s.R.l. in the joint tapping

Milan, Italy, for a purchase price of €21,080 thousand. The acquisition of the company was closed on 3 July 2013 and gfT holding Italy s.R.l.,

gfT holding Italy s.R.l., Milan, Italy, has agreed a put and call option for

The main motivation for the acquisition was to strengthen the position

of customers on the Italian market c) Positioning of selected expertise of sempla s.R.l. among European

Milan, Italy, has controlled the acquired company since this date.

the acquisition of the remaining 20%.

a) The high level of skill and motivation of employees at sempla s.R.l.

clients of the gfT group (credit products) In total, the acquisition is intended to drive the continued internationalisation of the gfT group.

of gfT as an IT specialist for banks and to add high-quality consulting

Due to the proximity of the acquisition and the reporting date, the disclo-

expertise on the Italian market. further reasons included:

sures required by IfRs 3 B 64(f)-(o), (q) in conjunction with IfRs 3 B 66 could not be made as there was not yet any opening balance sheet nor purchase price allocation.

Stuttgart, 6 August 2013 gfT Technologies Aktiengesellschaft The Executive Board

Ulrich Dietz

Jean-François Bodin

Marika Lulay

Dr. Jochen Ruetz

Executive Board

(Chairman)

Q1–2–2013

REsPONsIBIlITy sTATEMENT

To the best of our knowledge, and in accordance with the applicable reporting principles, the Interim Consolidated financial statements give a true and fair view of the assets, liabilities, financial position and profit or loss of the group, and the Interim 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 for the remaining fiscal year 2013.

Stuttgart, 6 August 2013 gfT Technologies Aktiengesellschaft The Executive Board

Ulrich Dietz

Jean-François Bodin

Marika Lulay

Dr. Jochen Ruetz

Executive Board (Chairman)

Executive Board

➜

❘

Notes

Review report

To GFT Technologies AG, Stuttgart We have reviewed the condensed interim consolidated financial statements of the GFT Technologies AG, Stuttgart, – comprising the consolidated income statement, consolidated statement of comprehensive income, consolidated balance sheet, consolidated statement of changes in equity, consolidated cash flow statement and the notes – together with the interim Group management report of the GFT Technologies AG, for the period from January 1 to June 30, 2013 that are part of the semi annual according to § 37 w (or § 37 x Abs. 3) WpHG [»Wertpapierhandelsgesetz«: »German Securities Trading Act«]. The preparation of the condensed interim consolidated financial statements in accordance with those IFRS applicable to interim financial reporting as adopted by the EU, and of the interim Group management report in accordance with the requirements of the WpHG applicable to interim group management reports, is the responsibility of the Company’s management. Our responsibility is to issue a report on the condensed interim consolidated financial statements and on the interim Group management report based on our review. We performed our review of the condensed interim consolidated financial statements and the interim Group management report in accordance with the German generally accepted standards for the review of financial statements promulgated by the Institut der Wirtschaftsprüfer (IDW). Those standards require that we plan and perform the review so that we can preclude through critical evaluation, with a certain level of assurance, that the condensed interim consolidated financial statements have not been prepared, in material respects, in accordance with the IFRS applicable to interim financial reporting as adopted by the EU, and that the interim Group management report has not been prepared, in material respects, in accordance with the requirements of the WpHG applicable to interim group management reports. A review is limited primarily to inquiries of company employees and analytical assessments 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 issue an auditor’s report. Based on our review, no matters have come to our attention that cause us to presume that the condensed interim consolidated financial statements have not been prepared, in material respects, in accordance with the IFRS applicable to interim financial reporting as adopted by the EU, or that the interim Group management report has not been prepared, in material respects, in accordance with the requirements of the WpHG applicable to interim group management reports. Stuttgart, 6 August 2013 KPMG AG Wirtschaftsprüfungsgesellschaft

Schwebler Bauer Auditor Auditor

Q1–2–2013

Financial Calendar

Further INFORMATION

Züricher Kapitalmarkt Konferenz, Zürich

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

5 September 2013

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

German Mittelstand Conference, New York

and the GFT share.

1 October 2013

Quarterly Financial Report as of 30 September 2013

GFT Technologies Aktiengesellschaft

7 November 2013

Investor Relations Andrea Wlcek

Deutsches Eigenkapitalforum, Frankfurt/Main

Filderhauptstrasse 142

11 –13 November 2013

70599 Stuttgart Germany

LBBW German Company Day, London

T +49 711 62042-440

14 November 2013

F +49 711 62042-301 ir@gft.com

This Half-Yearly Report 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 Aktiengesellschaft, Stuttgart, www.gft.com Text: GFT Technologies Aktiengesellschaft, Stuttgart, www.gft.com Creative concept and design: Impacct Communication GmbH, Hamburg, www.impacct.de