annu 2010al report - eventim...ment industries such as computer games, videos, cds and cinema lying...

AnnuAl RepoRt

2010

Contents2

Contents

1. 5 keygroupfigures

2. 6 reportbythesupervisoryboard

3. 10 forewordbythemanagementboard

4. 12 Ctsshares

5. 14 CorporategovernanCereportofCtseventimag

6. 18 Combinedmanagementreport 18 preliminarystatements 18 businessandmacroenvironment 29 earningsperformance,financialpositionandcashflow 52 briefassessmentofthebusinessyear 52 appropriationofearningsbyCtsag 52 dependenciesreportforCtsag 53 eventsafterthebalancesheetdate 53 riskreport 61 managementboardreportpursuanttosections289(4)and315(4)hgb 62 Corporategovernancedeclaration 62 reportonopportunitiesandexpectations

7. 66 ConsolidatedfinanCialstatements2010 66 Consolidatedbalancesheet 68 Consolidatedincomestatement 68 Consolidatedstatementofcomprehensiveincome 69 Consolidatedstatementofchangesinshareholders´equity 70 Consolidatedcashflowstatement 71 notestotheconsolidatedfinancialstatements

8. 140 finanCialstatementsofCtsag2010 140 balancesheetofCtsag 142 incomestatementofCtsag 144 notestothefinancialstatements

163 Contact,publishers´notes

contents

3

overview4

overview

Key gRoup figuRes

1Cf.page31fordetailedstatementofnon-recurringitems2purchasepriceallocationofticketcornerholdingagundseeticketsgermanygmbh; cf.page25‘Corporatemanagement’forfurtherexplanations3numberofshares:24million4numberofemployeesatendofyear(activeworkforce)

2010 2009 Change

[EUR’000] [EUR’000] [in %]

revenue 519,577 466,698 11.3%ebitda 87,996 79,974 10.0%ebit 70,556 71,280 -1.0%

normalisedebitda 95,817 79,974 19.8%normalisedebitbeforeamortisationfrompurchasepriceallocation 85,655 71,280 20.2%normalisedebitdamargin 18,4% 17,1% 1.3ppnormalisedebitmarginbeforeamortisationfrompurchasepriceallocation 16,5% 15,3% 1.2ppnon-recurringitems1 7,821 0 -amortisationfrompurchasepriceallocation2 7,278 0 -

earningsbeforetax(ebt) 68,853 71,496 -3.7%netincomeafternon-controllinginterest 41,771 39,943 4.6%Cashflow 62,807 58,258 7.8%

[eur] [eur]

earningspershare3,undiluted(=diluted) 1.74 1.66

[Qty.] [Qty.]

numberofemployees4 1,479 1,143ofwhichtemporary (144) (159)

1.

5

reportbythesupervisoryboard

reportbythesupervisoryboardofCtseventimagontheannualfinancialstatements,theconsolidatedfinancialstatementsandthecombinedmanagementreportforthecompanyandthegroupasawholeforthefinancialyearfrom1January2010to31december2010.

themembersofthesupervisoryboardofthecompanyduringthereportingyearweremr.edmundhug(oberstenfeld),prof.Jobstw.plog(hamburg),mr.horstr.schmidt(aschaffenburg,until17september2010)anddr.berndkundrun(hamburg,from4november2010).throughouttheyear,mr.hugactedasChairmanandprof.plogasvice-Chairman.nocommitteeswereformed.

ii.duringthereportingyear,thesupervisoryboarddischargeditsresponsibilitiesasrequiredbylawandthearticlesofincorporation.itwasregularlyinformedbythemanagementboardinwriting,verbally, promptlyandextensivelyaboutall issues relevant for corporateplanningandstrategicdevelopment,about theprogressofbusinessactivitiesand thesituationof thegroup, includingrisksand riskmanagement.thesupervisoryboardprovided themanagementboardwith regu-laradviceconcerningthemanagementofthecompany,andmonitoredhowthecompanyanditsgroupweremanaged.itensuredthatmanagementofthecompanywaslawfullyconducted,andwasinvolvedinalldecisionsoffundamentalimportanceforthecompany.afterthoroughexamina-tionandconsultation,thesupervisoryboardsubmitteditsopiniononthereportspreparedandtheresolutionsproposedbythemanagementboard,totheextentthatthisisrequiredbylawandbyprovisionsinthearticlesofincorporation.theactivitiesofthesupervisoryboardduringthereport-ingyearalsoincludedintensiveinvolvementinacquisitionsmadebythecompany,providingadviceanddeciding,wherenecessary,onconsentforsuchmeasures.decisionswerealsotakenusingthewrittenprocedure,wheresorequired.

thesupervisoryboardwas kept informedby themanagementboardnot only atsupervisoryboardmeetingsbutalsobeyondsuchmeetings–forexamplewhentransactionsofspecialimpor-tanceorurgencywerebeingconducted. inthereportingyear, thesupervisoryboardmeton19march2010(‘financialstatementsmeeting’),11may2010,12may2010(constitutivemeetingafterre-election),31august2010andon9december2010.themanagementboardofthecompanyalsotookpartatthesemeetingsandhadanopportunitytocommentonbusinessactivitiesofimpor-tanceforthecompany.additionalsupervisoryboardmeetingswereheldintheformoftelephoneconferenceson2July2010andon23august2010inordertoaddressissuesofcurrentimportance.thesemeetingswerealsoattendedbythemanagementboard.

RepoRt by the supeRvisoRy boARd

edmundhugChairman

2.

6


on thebasisof the submitted reportsandother information, thesupervisoryboardexaminedthegeneralbusinessdevelopmentof thecompanyand itsvarioussubsidiaries, inparticular theachievementofthebudgetedperformancefiguresforrevenueandearnings,aswellasthedevelop-mentofcashandthemainprojectscarriedoutbythecompanyandthegroupasawhole.

iii.attheannualshareholders’meetingofthecompanyheldinbremenon12may2010,pricewa-terhouseCoopersagwirtschaftsprüfungsgesellschaftinosnabrück,afirmofpublicauditors,waschosentoaudittheannualfinancialstatementsandtheconsolidatedfinancialstatementsasat31december2010.theauditcommissionwasdulygrantedbythesupervisoryboardChairmanonbehalfofallsupervisoryboardmembers.

the2010annualfinancialstatements,the2010consolidatedfinancialstatements,thecombinedmanagementreportandtherespectiveauditreportsweresubmittedbythemanagementboardofthecompanytothesupervisoryboardintimelymanner,andweredulyexaminedbythesupervi-soryboard.

atthesupervisoryboardmeetingon23march2011,theannualfinancialstatementsandthecon-solidatedfinancialstatementsfor2010,aswellasthecombinedmanagementreportandtheman-agementboard’sproposalforappropriationofprofits,werediscussedindetailwiththesupervisoryboard.thesupervisoryboardwasabletoconferwiththeauditor,whoalsoattendedthemeeting.

theannualfinancialstatementswerepreparedbythemanagementboardincompliancewiththestatutoryregulationsandwereissuedwithanunqualifiedauditopinionbytheauditor.

havingexamined the audit report, thesupervisoryboard approves the annual financial state-mentsaspreparedbythemanagementboard,whicharethereforeformallyadoptedinaccordancewith§172aktg(stockCorporationact).thesupervisoryboardalsoapprovestheconsolidatedfinancialstatementspreparedbythemanagementboardforthe2010financialyear,towhichnoobjectionsare raised.themanagementboard’sproposal forappropriationof thebalancesheetprofitwasreviewedandacceptedbythesupervisoryboardasaccordingwiththeinterestsofthecompanyanditsshareholders.

iv.inaccordancewith§312aktg,themanagementboardhaspreparedareportforthe1Janu-ary–31december2010financialyearontherelationshipstoaffiliatedenterprises,inwhichitisstatedthat,judgingfromthecircumstancesknownatthetimelegaltransactionsrequiringdisclosurewereconducted,thecompanyreceivedadequateconsiderationineachcaseandthatnomeasuresrequiringdisclosurewereeithereffectedorwaivedinthe2010businessyearatthebehestorintheinterestofaffiliatedenterpriseswithinthemeaningof§312aktg.

7


theauditorprovidedthefollowingunqualifiedauditopinionregardingthefindingsobtainedduringhisauditofthereportondependencies:

‘havingauditedandassessedthereportinaccordancewithprofessionalstandards,weconfirmthat

(1)thedisclosuresoffactmadeinthereportaretrueandcorrect,

(2)thattheperformancerenderedbythecompanyinconnectionwiththelegaltransactionsdetailedinthereportarenotunreasonablyhigh.’

thesupervisoryboardlikewiseexaminedthereportondependenciespreparedbythemanage-mentboardandconcurswiththeauditfindings.accordingtotheconclusivefindingsofthesupervi-soryboardinthecontextofsaidexamination,noobjectionsareraisedagainstthefinaldeclarationbythemanagementboardcontainedinsaidreport.

v.nochangesweremadetothecompositionofthemanagementboardduringthereportingyear.

vi.on09december2010,thesupervisoryboardandthemanagementboardissuedtheirmostrecently updated joint declarationof compliancewith thegermanCorporategovernanceCode,inaccordancewith§161aktg; thisdeclarationwaspublishedonthecompanywebsiteatwww.eventim.de.

thesupervisoryboardwishestothankthemanagementboardandallemployeesofthecompanyfortheworktheyperformedduringthe2010financialyear.

march2011

dr.berndkundrunprof.Jobstw.plogvice-Chairman

edmundhugChairman

8

reportbythesupervisoryboard 9

forewordbythemanagementboard

ladiesandgentlemen,

in the2010 financialyear,weconvincinglyprovedyetagain thatourcompanystandsonveryhealthyfoundations.thankstoaseriesofstrategicacquisitions,Ctseventimisnowabletotapconsiderablegrowthpotential.ourbusinessmodelhasalsoshownitselftobeexceedinglyresilient–whichisnotrivialityinthecontextoftheworsteconomiccrisistobeseenindecades.

theCtsgroupissuperblypositionedtofacethechallengesofthefuture,notleastonaccountof itsgreat innovatorystrength,highly-motivatedworkforceand itsuniquerangeanddiversityofeventsinthefieldsofmusic,sportandculture.ourcustomerscanidentifytoaspecialdegreewiththeproductsandservicesofferedbyCtseventim,consideringtheygenerallyhavestrongemo-tionalbondswiththeirsportsclubs,ortheirstarsonstage.

The ‘Renaissance of live music’ that has been observed for a number of years now is still holding sway:astudypublishedinoctober2010bythegfkconsumerresearchinstituteindicatesthat,in2009,germansspentaround3.17billioneuroonlivemusicevents–withotherentertain-mentindustriessuchascomputergames,videos,Cdsandcinemalyingfarbehind.weintendtocatertothishighlevelofdemandbycontinuingtoofferinspiringeventsandconcerts.

Our key financial figures show even better performance in 2010:theCtsgroupwasabletoincreaseitsrevenuefromeur466.7milliontoeur519.6millionintheperiodunderreview–animprovementof11%.althoughouroperatingprofitwascurtailedsomewhatbyacquisitionandinte-grationcosts,aswellaslegalconsultancyexpenses,amongotherfactors,thenormalisedgroupebitrosetoeur85.7million(+20%)afteradjustmentforthesenon-recurringitems,andthegroupebitdareachedeur95.8million(+20%).thedividendproposedtotheshareholders‘meetingiseur0.87pershare,makingitthehighestdividendeverpaidinthehistoryofCtseventim.

In the past financial year, CTS EVENTIM profited especially from high-margin Internet ticket sales: around360million potential buyers visited theeventimonline portals.our customersbought17.1millionticketsonline,around28%morethantheyearbefore.

thevalue-addedperticketissixtimeshigherinonlineticketingthaninconventionalsaleschan-nels.incombinationwiththisenormouspotential inthisareatheonlineticketingisthereforethecentralbasisforprofitablegrowthoftheCtseventimalsointhefuture.

ouronlineportalswereawardedtopgradesinanindependenttestconductedbythe‘Computer-bild’magazine.thetestcomparedtheavailabilityofticketsformusic,sportsandculturalevents,aswellasperformanceinrespectofprices,customerservice,website,termsofbusinessandtheprovider’sobligatoryarrangements for dataprotection.seven ticket shopsand resaleplatformswere reviewed in the test, inwhichwww.eventim.dewas theonlyone tobeawarded ‘good’asoverallmark.

In implementing its strategy for international expansion, CTS EVENTIM again achieved substantial growth in market presence by making further acquisitions in the course of 2010: thebiggesttakeoverwastheinvestmentinseeticketsdeutschlandgmbhinearlyJuly2010.bymakingthisacquisition,Ctseventimwasabletowidenits leadonthecompetition in itscorebusiness.ourcompanyalsosecuredexclusiveticketingaccesstothemusicalsproducedbythestageentertainmentgroup, by concludinga12-yearpartnershipagreement.theacquisitionofseeticketsgermanyalsoprovidesuswithsubstantialsynergies,especiallyduetoscaleeffectsinticketingoperations.

foRewoRd by the MAnAgeMent boARd

klaus-peterschulenbergChiefexecutiveofficer

3.

10

forewordbythemanagementboard

thefederalCartelofficeannouncedinaugustthatitwasplanningtosubjectthetakeovertoret-rospectivereview.specialisedmergercontrollawyerswehadcommissionedtoreviewthetakeoverpriortoconclusionofthetakeoverdealconcludedthatthetransactiondidnotneedtobenotifiedtotheauthoritiesduetothecircumstancesonthedatetheacquisitiontookeffect.weareconfidentthat,afterdetailedexaminationofallthefacts,thefederalCartelofficewillreachthesameconclu-sionaswedid.

twootherimportantacquisitionsmadein2010werethetakeoveroftheticketcornerholdingaginswitzerlandandthepurchaseoftheremainingsharesinticketones.p.a.initaly.thesemeas-ureshavereinforcedourmarketleadershipineurope;ourdeclaredobjectiveistohandletheentireeuropeanticketingoperationfromasingledatabase.

Our company continues to be very successful in the sports field as well:theCtseventimcooperateswithmorethan80clubs,associationsandsportspromotersinmorethan20differentdisciplines. in thegerman first-division football league, almost two-thirds of the clubs are nowworkingwithoursystems.weintendtoexpandfurtherinthisareainfuture.themissionofCtseventimsportsgmbhistoconvinceevenmorecustomersofthebenefitsprovidedbyourexcellenttechnologicalplatform.

In this foreword to the 2010 Annual Report, I would also like to mention the arbitration pro-ceedings with Live Nation, the US promoter of live events.noquestionaboutit–weweresur-prisedanddisappointedwhenlivenationwalkedawayfromtheagreementwesignedattheendof2007,whichallowedlivenationtooperateaCtsticketingsysteminnorthamericaunderlicenceandCtseventimtohandletheticketingoperationoflivenationincontinentaleuropeandgreatbritain.itdidsoforstrategicreasons,beforedecidingtoenterintoamergerwithticketmaster.wearestickingtoourstandpointinthisregard:Ctseventimisdemandingfulfilmentoftheagree-mentandpaymentofdamages.on5april2010,wethereforefiledforarbitrationagainstlivenationattheinternationalChamberofCommerce(iCC)inparisandweareworkingintensivelyonsettle-mentofourclaims.adecisionisnotexpectedbeforethefourthquarterof2011,butweassume,asmostanalystsdo,thatthedecisionwillbeinourfavour.

Ctseventimagsharesarepraisedbyequitymarketexpertsasadividend-payingandattrac-tive investment. inJuly2010, thedZbankand thehandelsblattnewspaperperformedacheckonthekeyfiguresofgermanshares.Ctseventimshareswerevotedintothe‘bestofthebest’category,basedon long-termrevenue,earningsandbookvaluegrowthandshareperformanceascriteria.thisachievementmustbecreditedabovealltotheemployeesofCtseventimag,whosededicationandcommitment tocustomersatisfactionand thesuccessofour company isdemonstratedeverydayoftheweek.

klaus-peterschulenbergChiefexecutiveofficer

11

Ctsshares

Ctsshares–arewardinginvestment,evenintimesofCrisis

shares inCtseventimagperformedverywell during the reportingperiod; from4January2010to30december2010,theirvalueappreciatedbymorethan35%,almostparalleltothesdaXinwhichitislisted.sincetheendofaugust2010,anupwardtrendhasbeenestablishedandhasremainedintact,reachinganewall-timehighofeur48.90attheendofJanuary2011.withadivi-dendyieldof2.1%attheannualshareholders’meetingon12may2010,sharesinCtseventimagheldtruetotheirreputationasasustainabledividend-payinginvestment.

accordingtoananalysisconductedbydZbankandthehandelsblattfinancialnewspaperinJuly2010,Ctseventimisoneofthe‘bestofthebest’amongagroupof150germansharesthatwereevaluatedaccordingtothecriteriaoflong-termrevenue,earningsandbookvaluegrowthandshareperformance.

analystsatdZbank,berenbergbankandbankofamericamerrilllynchconsiderCtssharestohaveconsiderablepotentialandgivethema‘buy’rating.followingpublicationofthepreliminaryfiguresfor2010infebruary2011,analystsatdZbankpeggedthefairvalueofCtssharesateur54.theattractivenessoftheCtssharesreflectsthehugeinterestfrominvestorsoncapitalmarketconferencesandroadshowsineuropeandintheusa.

Ctsshareshavebeenfollowedbyvariousanalystsforsomeconsiderabletimealready:analysesofCtssharesareproducednotonlybythedesignatedsponsors–iCfkursmakleragonbehalfofdZbankandCommerzbankag–butalso,interalia,byberenbergbank,CréditagricoleCheu-vreux,deutschebank,macquariesecuritiesgroup,bankofamericamerrilllynchandnordlb.

cts shARes4.

12

Ctsshares

120%

140%

100%

150%

110%

80%

130%

90%

Jan10 feb10 mar10 apr10 may10 Jun10 Jul10 aug10 sep10 oct10 nov10 dec10 Jan11 feb11

Cts sdaX

theCtssharepriCe(01.01.2010-28.02.2011–indeXed)

2010 2009[EUR] [EUR]

typeofshares no-parvalueordinarybearershares earningspershare 1.74 1.66securitiescode 547030 Cashflow 62,807,351 58,258,380isinnumber de0005470306 high(Xetra) 46.95 35.99symbol evd low(Xetra) 32.54 17.03firstlisted 01.02.2000 year-end-price(Xetra) 46.22 34.14stockexchangesegment primestandard

marketcapitalisation(basedonyear-end-price) 1,109,280,000 819,360,000

indices sdaX;primeallshare sharesoutstandingon31.12. 24,000,000 24,000,000sectoralindex primemedia sharecapitalafteripo 12,000,000 12,000,000

13

Corporategovernancereport

Ctseventimaghasalwayscompliedwithnationallyand internationallyacceptedstandardsofgoodandresponsibleenterprisemanagement.forus,Corporategovernanceisafundamentalstandardapplying toall areasof thecompany.externaldirectorshipsheldbymanagementandsupervisoryboardmembersareshownunderpoints19and20inthenotestotheconsolidatedfinancialstatements.relatedpartydisclosuresaremadeunderpoint17 in thenotes to thecon-solidatedfinancialstatements.themanagementboardprovidesthefollowingreportoncorporategovernancewithinthecompany–simultaneouslyonbehalfofthesupervisoryboard–inaccord-ancewithitem3.10ofthegermanCorporategovernanceCode(gCgC):

1. CorporategovernanCedeClarationpursuantto§161aktg

themanagementboardandsupervisoryboardofCtseventimagsubmittedafurtherdeclara-tionofcompliancewiththerecommendationsofthe‘governmentCommissiononthegermanCor-porategovernanceCode’on9december2010,inaccordancewith§161aktg.thedeclarationofcompliancereadsasfollows:

‘duringtheperiodsincesubmissionofthepreviousdeclarationofcompliance,CtseventimaghasfulfilledtherecommendationsofthegCgCdated18June2009,andinlargepartcomplieswiththerecommendationsofthegCgCdated26may2010,withthefollowingexceptions:

incompliancewith the regulationsgoverning theprimestandardsegment, interim reportsarepublishedwithin60daysafter theendofeach reportingperiod (gCgC7.1.2),as thismakes iteasiertoensurethatreliablefiguresmayalsobeobtainedfromthemanyunlistedcorporationsingermanyandabroad.

informationrelatingto third-partycompanies inwhichthecompanyholdsparticipating interestsarepublishedwhensuchparticipatinginterestsareincludedinconsolidation(gCgC7.1.4),whichmeansthatallsignificantparticipationsaredisclosed.

nosupervisoryboardcommitteesareformedbecausetheboardconsistsofonlythreemembers.intheestimationofthecompany,thecreationofcommitteesisnotconducivetoincreasingtheeffi-ciencyofthesupervisoryboard’swork(gCgC5.3.1,5.3.2and5.3.3).forthesamereasons,thesupervisoryboardrefrainsfromdefiningandpublishingspecifcobjectivesregardingitscomposition(gCgC5.4.1).

performance-basedcompensationofsupervisoryboardmembershasbeenwaivedforreasonsofcost,sincesuchasystemwouldonlymakesenseifaccompaniedbyasubstantialincreaseinthecompensationpaidtosupervisoryboardmembers(gCgC5.4.6).

noagelimithasbeenspecifiedbythesupervisoryboardformembersofthemanagementboardasyet(gCgC5.1.2)becausethecompanyseesnocauseforlimitingtheoptionsavailabletothesupervisoryboard–andhencetoshareholders–whenappointingmembersofthemanagementboard.

thed&opoliciesforthemanagementboardincludethedeductibleprovidedforin§93ii3aktg.thepoliciesforthesupervisoryboarddonotincludeadeductiblebecauseitappearstobeneithernecessaryforcontrollingbehaviour,norexpedientnorreasonable inviewof themoderateremu-nerationpaidtomembers(gCgC3.8).

coRpoRAte goveRnAnce RepoRt of cts eventiM Ag

5.

14


althoughtheagendaoftheannualshareholders’meetingandpossiblysomemanagementboardreportsarepublishedontheinternetinadditiontotheannualreport,otherdocumentspertainingtoagenda items,suchascontractsorannual financialstatements,arenotpublished inorder toprotectthecompany’sconfidentialinformation.thesedocumentsaremadeavailabletocompanyshareholdersonly,inaccordancewithstatutoryrequirements(gCgC2.3.1).

thecompanyalsosupportsshareholdersinexercisingtheirvotingrights,byappointingaproxytoexerciseshareholdersʼvotingrightsinaccordancewithinstructions.however,thecreationofapostalvotingsystemiswaivedintheinterestoflimitingtheadministrativeexpenseandthecostsoftheshareholdersʼmeeting(gCgC2.3.3).’

inaddition,CtseventimagalreadyadheresinlargemeasuretotheadditionalgCgCsugges-tionsregardinggoodcorporategovernance.

2. ownershipofCompanysharesorfinanCialderivativesrelatingtosuChsharesonthepartofmanagementboardandsupervi-soryboardmembers

asattheclosingdatefortheannualfinancialstatements,31december2010,membersofthemanagementboardandsupervisoryboardofCtseventimagheldthefollowingquantitiesofno-parvaluebearersharesinthecompany(isinde0005470306):

Number of shares

Share

[Qty.] [in %]

Members of the Management Board:klaus-peterschulenberg(Chiefexecutiveofficer) 12,016,000 50.067%volkerbischoff 0 0.000%alexanderruoff 2,000 0.008%

Members of the Supervisory Board:edmundhug(Chairman) 3,650 0.015%prof.Jobstw.plog 650 0.003%dr.berndkundrun 0 0.000%

15


4. notestothemanagementboardCompensationsystempursuanttoitem4.2.3gCgCanddisClosuresontheindividualCompensa-tionofmanagementboardmembers,inaCCordanCewiththelawgoverningsuChdisClosures(vorstandvergütungsoffenle-gungsgesetZ)

thetotalamountofcompensationpaidtomembersoftheCtseventimagmanagementboardisdisclosedannuallyinthenotestotheannualfinancialstatementsofthecompany,andamountedin the2010business year toeur2.233million.Compensation consists of fixedannual emolu-mentsandavariable,performance-basedpayment.theagreedcriteria forgrantingthevariablecomponent,andfortheamountpaid,arerevenue,ebit(earningsbeforeinterestandtaxes)andotherperformance-basedfigures,i.e.clearlydefined,auditableandrelevantsuccesscriteriathatarecontinuouslymonitoredbythesupervisoryboard.themembersofthemanagementboardalsoreceivepaymentsinkind,specificallyintheformofanappropriatecompanycar.

stockoptionsorsimilarcomponentsofcompensationhavenotbeencontractuallyagreedandarenotgrantedtomembersoftheCtseventimagmanagementboard,sonodisclosuresinthisregardneedbemade.therearenocontractualcommitmentsregardingpaymentswhenboardmembershipends.theamountsofcompensationpaidtotheindividualmembersofthemanage-mentboardandwhichmustbedisclosedbylawareshowninthefollowingtable.

CompensationpaidtomembersoftheCtseventimagmanagementboard:

Name Fixed salary Benefits Management Bonus Total

[EUR] [EUR] [EUR] [EUR]

klaus-peterschulenberg 1,000,000 298 300,000 1,300,298volkerbischoff 350,000 12,135 105,000 467,135alexanderruoff 350,000 10,529 105,000 465,529

1,700,000 22,962 510,000 2,232,962

Name Position Transaction Trading day Number of units

edmundhug supervisoryboard sale 08.12.2010 1,000prof.Jobstw.plog supervisoryboard purchase 02.07.2010 650

3. purChaseorsaleofCompanysharesorfinanCialderivativesrelatingtosuChsharesbymanagementboardandsupervisoryboardmembers

duringtheperiodunderreview,supervisoryboardmembersofCtseventimagengagedinthefollowingtransactionsinvolvingno-parvaluebearersharesofthecompany(isinde0005470306):

16


5. workingmethodsofthemanagementboardandsupervisoryboard

themanagementboardandthesupervisoryboardworkcloselytogetherforthebenefitof thecompanyandmaintainregularcontact.thesupervisoryboardholdsfourordinarymeetingsayear,atregularintervals.themanagementboardkeepsthesupervisoryboardinformedingoodtimeofallrelevantbusinessdevelopments,plans,potentialrisksandriskmanagement.theactivitiesof themanagementboardand thesupervisoryboardarespecified in thestandingorders.thestandingordersofthemanagementboardprovideguidanceonthedepartmentalresponsibilitiesofitsindividualmembersandontheadoptionofresolutions.theChiefexecutiveofficerexchangesinformationregularlywiththeChairmanofthesupervisoryboard.

themanagementboardnormallymeetsonaweeklybasis.asarule,itsresolutionsareadoptedbysimplemajority.according to themanagementboard’sscheduleof responsibilities, therearethreeboarddepartments:theChiefexecutiveofficer(Ceo),theChieffinanceofficer(Cfo)andtheChiefoperatingofficer(Coo).

17

Combinedmanagementreport

1. preliminarystatements

inaddition tostandalone financial statements forCtseventimag (hereinafter ‘Ctsag’) inaccordancewiththeaccountinglegislationinthegermanCommercialCode(handelsgesetzbuch-hgb),themanagementboardhasalsopreparedconsolidatedfinancialstatementsinaccordancewiththeinternationalfinancialreportingstandards(ifrs),complyingtherebywithallifrsandwith interpretationsof the internationalfinancialreporting interpretationsCommittee(ifriC)asapplicable in theeuropeanunion (eu)on thebalance sheet date.Consolidated financial state-mentsreflectingapplicablehgbprincipleswerenotprepared.

themanagement report ofCtsagand thegroupmanagement report havebeen combined.unlessstatedotherwise,theinformationcontainedinthiscombinedmanagementreportreferstothefinancialsituationandbusinessdevelopmentofthegroupandCtsag.inaddition,informationonthefinancialsituationandbusinessdevelopmentofCtsagasastandalonecompanyisalsoprovidedinseparatesectionsofthisreportorisshownbyareferenceto‘Ctsag’.

theaccountingpoliciesandconsolidationmethodsareforthemostpartthesameasthoseappliedintheconsolidatedfinancialstatementsasat31december2009.thecomparativefiguresincludedintheincomestatementsandbalancesheetrelatetotheconsolidatedfinancialstatementsasat31december2009.

2. businessandmaCroenvironment2.1 maCroeConomiCClimate

therecoveryof theglobaleconomysincemid-2009providedaconsiderableboost togermanexportsandbuttressedtheeconomywhileitsurmountedthecrisisafflictingtherealeconomy.inthecourseof2010,therecoveryofthegermaneconomywasincreasinglyfuelledbydomesticdemand.afteradjustment for inflation,grossdomesticproductsurgedyear-on-yearby3.6%,which is thehighestannualgrowthratesincegermanunification.

thegerman employmentmarket in particular showed itself to be robust – therewas only averysmalldecreaseinthenumberofpeopleemployed,andsincefebruary2010,theseasonallyadjustedemploymentfigurehasshownacontinuousincrease.inaddition,theriseingovernmentdebtwaslowerthananticipated,andacreditcrunchaffectingtheprivatesectorfailedtomaterialise,withtheresultthatthegermaneconomyhashadoneofthestrongestgrowthratesintheeurozonesincetheendofthecrisis.

coMbined MAnAgeMent RepoRt6.

18


2.2 industry-speCifiCenvironment

thegroupoperates in the leisureeventsmarketwith itsticketingandliveentertainmentseg-ments.Ctsag,theparentcompanyofthegroup,operatesinthefieldofticketingandisthedomi-nantplayerinthatsegmentonaccountofitssheerimportancefortheticketingindustry.statementsmadeinrespectoftheticketingsegmentthereforeapplyinparticulartoCtsagaswell.

organisingandexecutingevents is theprimaryobjectof theliveentertainmentbusiness.thesituationinthisindustryischaracterisedbyacceleratedglobalisationandmonopolisation.owingtoitsmarketposition,thegroupisconfrontedintheliveentertainmentsegmentbyveryfewcompeti-torsingermany,austriaandswitzerland.

promotersofleisureeventsconsidersalesoftheirticketstobethecriticalfactorfortheirsuccess.thesesalesactivitiesarethebasicobjectoftheticketingsegment,whichmarketsevents(tickets)throughitsleadingnetworkplatform(eventim.net),itsin-houseticketingproduct(eventim.inhouse),asportsticketingproduct(eventim.tixx)andaproprietarysolutionfor ticketsalesandadmissioncontrolinstadiumsandarenas.duetothenetworkingandinternationalisationofticketingsoftwareatnetwork,webandinhouselevel, implementedin2007, it isalsopossibletooffercross-borderticketsinastandardisedticketingsystem(globalticketingsystem).

besidesthegermanmarket,thegroupalsooperatesintheticketingsegmentinothereuropeancountries(italy,sweden, theuk, theCzechrepublic,Croatia, thenetherlands,austria,finland,poland,russia,switzerland, israel, theslovakrepublic,slovenia,hungary,bulgaria,romaniaandserbia),whereitcompeteswithdomesticandforeignnetworkoperatorsandticketingsoftwareproviders.

theevents forwhich tickets are sold using theproprietaryCts ticketing software range fromconcertsofclassicalmusic,throughrockandpop,plays,festivals,fairsandexhibitionstosportsevents,especiallyfootball.astheleadingticketsupplier,theCtsgroupissuperblypositionedinthemarket.thatpositionhasbeenreinforcedandextendedintheticketingfieldbyabroaddistribu-tionsystemfeaturingafull-coveragenetworkofboxoffices,salesviacallcentresandinternetticketshops.byacquiringholdingsinleadinggermantourandconcertpromoters,thegroup’spositiononthesemarketshasbeenstrengthenedforthefutureaswell.

theCtsgroup competeswith national and regional networkoperators both ingermanyandabroad.the companyenjoys competitive advantagesover competitors, in that theCtsgroupoperateswithfullgeographiccoverageinavarietyofmarketsegmentsusinganetworkedticketingsystem,andbecauseitlinksallsaleschannelsinacommondatabase.anotheradvantageliesinthegroup’sallianceswithmajorpromotersofliveevents,thusallowingalargenumberofdifferentandattractiveeventstobemarketedthoughallthegroup’ssaleschannels.inthe2010financialyear,thecompany’scompetitivestandingwasfurtherimprovedbyexpandingtheticketingsegmentbothdomesticallyandinternationally.

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2.3 groupbusinessperformanCe

theCtsgroupwasable to furtherconsolidate itsgrowthand itspositionaseurope’smarketleaderintheticketingandliveentertainmentsegmentsinthe2010financialyear,despitethepre-vailingeconomicuncertainties.theticketingbusinessformusic,culturalandsportseventsprovedtobeexceedinglyrobustandsustainableinadifficultbusinessenvironment.

keyperformancefiguresareshowninthetablebelow:

intheTicketing segment,organicgrowthinthecoreeuropeanmarkets,combinedwithanumberofsuccessfulacquisitionsandanincreaseinthevolumeofticketssoldviatheinternet,producedasubstantialimprovementinthekeyperformancefigures.inthehigh-margininternetsaleschannel,theCtsgroupsold17.1millionticketsusingtheCtssystemsinthereportingperiod–ayear-on-yearincreaseofaround28%(2009:13.4million).

withtargetedacquisitionsandincreasesinexistingshareholdings,thecompany’smarketpositionwas furtherconsolidatedandextended,primarily ingermany,switzerlandand italy. in the2010reportingyear,100%ofthesharesinseeticketsgermanygmbh,withsubsidiariesingermanyandpoland(hereinafter:seeticketsgermany/ticketonlinegroup),andthrougheventimonlineholdinggmbhastheacquiringcompanyadditionalsharesinticketones.p.a.,italy,wereacquired.theCtsagalsoacquired100%ofthesharesintheswissfirmofticketcornerholdingag(here-inafter:ticketcornergroup)throughasubsidiary,eventimChag,thuscontinuingitssuccessfulprogrammeofinternationalexpansion.attheendofthe2010financialyear,50%ofthesharesineventimChweresoldtoringierag,aZolfingen-basedmediacompany.eventimChagremainsfullyconsolidatedduetoitsbeingundercontinuedcontrol.inadditiontosecuringanattractivepro-grammeofevents,theacquisitionsalsoprovidetheCtsgroupwithconsiderablesynergies–espe-ciallythroughscaleeffectsinticketing.giventhehistoricallylowinterestratesavailablein2010,theacquisitionswereprimarilyfinancedwithexternalloans.

2010 2009[EUR million] [EUR million]

Revenue (before consolidation between segments)ticketing 193.9 152.5liveentertainment 333.8 318.7group 519.6 466.7

EBITDAticketing(normalised) 69.3 55.4liveentertainment 26.6 24.5group(normalised) 95.8 80.0

Cashflow 62.8 58.3numberofemployees(activeworkforceatendofyear) 1,479 1,143

20


inapril2010,Ctsagfiledforarbitrationagainstlivenationinc.andlivenationworldwideinc.attheinternationalChamberofCommerce(iCC),inwhichlivenationissuedforvariousbreachesofcontract,withapleathatthelattertobeorderedtofulfilthepartnershipagreementconcludedindecember2007andtopaydamages.inJune2010,livenationgavenoticethatitwasterminat-ingtheagreementonthegroundsofallegedbreachesbyCtsag.Ctsagrejectedthenoticeofterminationbylivenationandannouncedadditionalclaims todamages in theorderofmillions.untilmid-2010,thecooperationinitiatedin2009withlivenationwasstillhavingapositiveeffectonrevenueandearningsintheticketingsegment.

underthecooperationagreementconcludedinoctober2009betweentheorganisingCommittee(oC)ofthegermanfootballassociation(dfb)andCtsagfortheentireticketingoperationforthefirstfifawomen’sworldCup,tobeheldingermanyin2011,asubstantialvolumeofsaleswerealreadygeneratedinthe2010financialyear.

intheLive Entertainment segment,therecordprofitsachievedin2009weretoppedinthe2010financialyearthankstoalargenumberofsuccessfulconcerteventsandtours,andbydevelopingsuccessfultypesofevent.thissegmentachieveditsbest-everearningssincetheipoin2000.

strategicrealignmentoftheliveentertainmentsegmentforfurtherimprovementinearningsandmarginsisprimarilyfocusedonimprovingthenetprofitmargin.sharesinconsolidatedcompanieswere increasedorreducedtothisend. inadditiontovarious increases inshareholdings,sharesinfkpscorpiokonzertproduktionengmbh,hamburg (hereinafter:fkpscorpio),were soldbymedusamusicgroupgmbh,bremen (hereinafter:medusa).thismeans thatmedusanowholdsonly45%ofthatcompany,whichisaccountedforasanassociateasfrom1July2010.until30June2010,earningsgeneratedbyfkpscorpioanditssubsidiarieswerefullyconsolidatedandrecognisedintheconsolidatedfinancialstatements.

2.4 organisationandCorporatestruCture2.4.1 organisation

inadditiontomanagingitsownoperativebusiness,themostimportanttasksofCtsagasparentcompanyincludecorporatestrategy,riskmanagementandinsomerespectsthefinancingoftheCtsgroup.

accordingtothearticlesofincorporation,Ctsagasparentcompanyhasitsregisteredofficeinmunich;theadministrativeheadofficeisinbremen.

thegroupcompaniesareclassifiedintotwosegments,namelyticketingandliveentertainment.

theCtsgroupismanageddecentrallytoallowdecisionstobemadeascloseaspossibletothemarket.thismeansthatthesubsidiarieshaveconsiderablediscretioninallmarket-andcustomer-relatedactivities.themanagementandcontroll structuresaswell as thecompensationsystemarecompliantwithstatutoryrequirementsandaregearedtolong-termbusinesssuccess.forthis

21


reason,thecompensationpackagesformembersofthemanagementboardarecomprisedofvari-ouscomponents,specificallythenon-performance-basedfixedsalaryandadditionalbenefitsintheformofpaymentsinkindandaperformance-basedbonus.thefixedsalaryandbenefitsarepaidmonthly.benefitsmustbetaxedasincomebytheindividualboardmember.thebonusespaidtoeachindividualmemberaredecideduponbythesupervisoryboardonthebasisofperformancecriteria.therearenocontractualcommitmentsregardingpaymentswhenboardmembershipends.noloansaregrantedtomanagementboardmembersortheirrelatives.referenceismadetopoint19inthenotestotheconsolidatedfinancialstatementsandtopoint4intheCorporategovernancereportregardingdetailsofindividualcompensationpackages.

forthe2010financialyear,themembersofthesupervisoryboardofCtsagreceivedemolu-mentstotallingeur80thousand,aswellasreimbursedexpensesofeur9thousand.

2.4.2 ChangesingroupstruCture

inadditiontoCtsagasparentcompany,theconsolidatedfinancialstatementsalsoincludeallrelevantinvestments.

thefollowingcompanieswereincludedordeconsolidatedinthe2010reportingperiod.

tiCketing

in January 2010,s.C. eventim.ro s.r.l., bucharest,was included in consolidation for the firsttime.the firm ofticketexpressgesellschaft zurherstellung und zumvertrieb elektronischereintrittskartenmbh,vienna,holds59%ofthiscompany.

inJanuary2010,eventimsp.zo.o,warsaw,wasincludedinconsolidationforthefirsttime.Ctsagholds100%ofthiscompany.

infebruary2010,Ctsagacquired100%ofthesharesintheswissfirmofticketcornerholdingag,rümlang(hereinafter:ticketcornerholding), through thenewly-establishedeventimChagsubsidiaryregisteredon28January in theZurichcompaniesregister. inaddition toticketcornerholding,theticketcornergroupalsoincludesitsswisssubsidiary,ticketcornerag,rümlang,thegermansubsidiary,ticketcornergmbh,badhomburg,andtheaustriansubsidiary,ticketcornergmbh,vienna.attheendofthe2010financialyear,50%ofthesharesineventimChagweresoldtoringierag,theZolfingen-basedmediacompany.

inJuly2010,Ctsagacquired100%ofthesharesinseeticketsgermanygmbh(hereinafter:seeticketsgermany),acompanydomiciled inhamburg.seeticketsgermanywasamembercompanyofseeticketsinternationalbvinamsterdam;40%isownedbystageentertainmentbvand60%byparcom,aprivate-equitygroup.byacquiringseeticketsgermany,Ctsagsimulta-neouslytookoverticketonlinesoftwaregmbh,ticketonlinesales&serviceCentergmbhandticketonlinepolskaspzooinpoland.a12-yearexclusiveticketingcontractwithstageentertain-mentgermanywasconcludedsimultaneouslywiththesharepurchaseagreement.

22


inseptember2010,ticketones.p.a.,milan,acquired51%ofthesharesinticketerias.r.l,rome.ticketerias.r.l.mainlyoperates in ticketing forculturalevents.thechangeofcompanynametot.o.s.C.–ticketonesistemiCulturalis.r.l.wasenteredintheregisterofcompaniesinnovember2010.

indecember 2010,CtsagestablishedCtseventim israel limited,telaviv,with anothershareholder.Ctsagholds70%ofthesharesinsaidcompany.

liveentertainment

inJune2010,medusasold5.2%ofthesharesinfkpscorpio.thismeansthatmedusanowholdsonly45%ofthesharesinthatcompany.thissaleofsharesledtolossofcontrolbymedusa,withtheresultthatfkpscorpioanditssubsidiarieswillnolongerbeincludedinconsolidationandareaccountedforasassociates.

thefollowingoverviewshowsallthecompaniesincludedbyfullconsolidationintheconsolidatedfinancialstatementsasat31december2010.

23


seeticketsgermanygmbh,hamburg

CTS EVENTIM AG, Munich

ticketonlinesales&serviceCentergmbh,parchim

ticketonlinesoftwaregmbh,hamburg

ticketonlinepolskaspolkaz.o.o.,warsaw

Ctseventimsolutionsgmbh,bremen Ctseventimnederlandb.v.,amsterdam

tsCeventimticket&tourist-service-Centergmbh,

bremen

ticketexpressgesellschaftzurherstel-lungundzumvertriebelektronischer

eintrittskartenmbh,vienna

Ö-ticket-südost,gesellschaftzurher-stellungundzumvertriebelektronischereintrittskartenmbh,wienerneustadt

Ö-ticketnordwestgmbh,vienna

Öts,gesellschaftzumvertriebelektro-nischereintrittskartenmbh,stainz

Ö-ticket-nordosteintrittskartenvertriebgmbh,tulln

ticketexpresshungarykft.,budapest

getgoconsultinggmbh,hamburg

eventimonlineholdinggmbh,bremen

Ctseventimisrael,telaviv

Ctseventimruo.o.o.,moscow

lippupisteoy,tampere

Ctseventimswedenab,stockholm

eventimuklimited,london

eventimCZs.r.o.,prague

tempodomegmbh,hamburg

Ctseventimschweizag,basle

61.lydiavermögensverwaltungs-gesellschaftmbh,bremen

teXhungarykft.,budapest

s.C.eventim.ros.r.l.,bukarest

ticketcornergmbh,vienna

rp-eventimgmbh,düsseldorf

ticketcornergmbh,badhomburg

ticketones.p.a.,milan

eventimChag,Zürich

ticketcornerholdingag,rümlang

ticketcornerag,rümlang

t.o.s.t.,ticketonesistemiteatralis.r.l.,milan

t.o.s.C.–ticketonesistemiCulturalis.r.l,rome

Ticketing Live Entertainment

medusamusicgroupgmbh,bremen

eventimpopkurshamburggemeinnützigegmbh,hamburg

mareklieberbergkonzertagenturholdinggmbh,frankfurt/main

dirkbeckerentertainmentgmbh,Cologne

semmelconcertsveranstaltungsservicegmbh,bayreuth

argokonzertegmbh,würzburg

actentertainmentag,basle

mareklieberbergkonzertagenturgmbh&Co.kg,frankfurt/main

mareklieberbergkonzertagenturverwaltungsgmbh,frankfurt/main

lskonzertagenturgmbh,vienna

pgmpromotersgroupmunichkonzertagenturgmbh,munich

peterriegerkonzertagenturholdinggmbh,Cologne

peterriegerkonzertagenturgmbh&Co.kg,Cologne

peterriegerverwaltungsgmbh,Cologne

show-factoryentertainmentgmbh,bregenz

gsoholdinggmbh,bremen

gsogesellschaftfürsoftwareentwicklungundorganisation

mbh&Co.kg,bremen

gsoverwaltungsgesellschaftmbh,bremen

Ctseventimsportsgmbh,hamburg

24


2.5 Corporatemanagement

Companypolicyisfocusedonsustainedgrowthinthevalueofthecompany.

inordertomanagethecompanyaccordingtovalue-basedprinciples,asystemofperformanceindicatorsisused.

thekeycriteria(keyfigures)forassessingthevaluegrowthoftheoperatingbusiness,foreachsegment,aresustainedincreaseinrevenue,innormalisedebitda(earningsbeforeinterest,taxes,depreciationandamortisation),normalisedebit(earningsbeforeinterestandtaxes)beforeamor-tisationfrompurchasepriceallocation,andeps(earningspershare).byfocusingonsustainedincreasesinthevalueofthegroup,temporarynon-recurringitems(forexampleafteracquisitions)areadjustedbynormalisation,whichensuresthatkeyassessmentcriteriacanbecomparedoverseveralyears.

anewkeyfigurecalled‘normalisedebitbeforeamortisationfrompurchasepriceallocation’wasdefined in the reportingyeardue to theacquisitionsmadeand theoveralleffects resulting fromremeasurementof intangibleassetstakenover(trademark,customerbaseandsoftware).whenthepurchasepriceallocation isconducted inaccordancewithifrs,the intangibleassetsof thetargetcompaniesmustberemeasuredwiththeirfairvaluesasatthedateoffirstinclusionincon-solidationwithinthegroup.intheinitialconsolidationoftheticketcornergroupandtheseeticketsgermany /ticketonlinegroup, ticket softwareproducts takenover in2010werewrittendownsubstantially,andnewly-createdvaluessuchastrademarkandcustomerbasewererecognisedattheirfairvalue.theseremeasuredintangibleassetsareamortisedonthebasisofredefinedusefullivesinthegroup.thesubstantialamortisationwithinthegroupresultingfromthepurchasepriceallocation,whichamounttoeur7.278million,wereeliminatedinthekeyfigure‘normalisedebitbeforeamortisationfrompurchasepriceallocation’inordertoprovideafairviewofearningspower.

asa result of its successful strategyof profitable growth, theCtsgroupachieved significantyear-on-yearimprovementsinthekeyperformanceindicatorsofrevenue,normalisedebitdaandnormalisedebitbeforeamortisationfrompurchasepriceallocationinthe2010financialyear(cf.page1‘keygroupfigures’).

thereturnoncapitalemployed(roCe)forthe2010financialyearis24.4%.basedonweightedborrowing costs of 2.57%as at the balance sheet date, theweighted average cost of capital(waCC)fortheCtsgroupcomesto5.72%.theexcessreturnof18.68%isaclearindicatorforthepositivegrowthinvalueoftheCtsgroup.

theaimoffinancialmanagementistoensuresolvencyandtomaintainfinancialbalancewithinthegroup.Cashreserves,intheformofoverdraftfacilitiesandcash,areheld.

theCtsgroupmanagesitscapitalwiththeaimofmaximisingprofitsforshareholdersbyoptimis-ingthedebt-to-equityratio.thegroupcompaniesoperateunderthegoingconcernpremise.

the capital structure of theCtsgroup comprises debt, cash and cash equivalents and theshareholdersʼequityowedtoinvestorsinCtsag.thisshareholders’equityiscomposed,specifi-cally,ofoutstandingshares,thecapitalreserveandtheretainedearnings.

25


akeyvariableusedincapitalriskmanagementisthegearingratio,i.e.theratiobetweennetcon-solidateddebtandgroupshareholders’equityaccordingtoifrs.riskconsiderationsmeanthattheaimmustbetohaveahealthynetdebt/equityratio.

thenetdebt/equityratioisasfollows:

31.12.2010 31.12.2009[EUR’000] [EUR’000]

debt*) 206,358 33,179Cashandcashequivalents -178,036 -229,794Net debt 28,322 -196,615shareholders’equity**) 158,108 149,864netdebttoshareholders’equity 18% -131%

*) debtistdefinedasnon-currentandcurrentfinancialliabilities**)includingnon-controllinginterest

26


net debt indicates theamount of debts a companyhasafter all financial liabilities havebeenredeemedwithcashandcashequivalents.duetotheacquisitionsmadeinthe2010financialyear,theratiobetweenexternalloansandthetotalcapitaloftheCtsgroupincreased.theleverageofloancapitalisexpectedtohavepositiveeffectsonthereturnonequity.

oftheexternalloans,eur141.707millionaresubjecttocompliancewithstandardfinancingcov-enantsforcompanieswithgoodcreditworthinessratings.otherthanfulfilmentofthesefinancingcovenants,therearenospecificrestrictionsthatmightadverselyaffecttheavailabilityoffunds.theCtsgroupassumesthatthecovenantswillalsobehonouredintheyearsahead.

2.6 internalaCCountingControlsystem

the internalaccountingcontrolsystem(iaCs)contains thepolicies,proceduresandmeasuresdesignedtoensurecorrectandreliableaccounting,andissubjectedtocontinuousimprovement.theaimoftheriskmanagementsystemistoidentify,assess,controlanddocumentmaterialrisks,aswellasrisksthatthreatenthecontinuedexistenceofthecompanyasagoingconcern.furtherdescriptionsoftheriskmanagementsystemareprovidedunderpoint8.1oftheriskreport.

process-integratedandprocess-independentmonitoringmeasuresarethekeyelementsof theinternalmonitoring systemwithin theCtsgroup. in addition to automatic it process controls,manualprocesscontrols,suchasthe‘foureyesprinciple’,arealsoanessentialpartoftheprocess-integratedmeasures.theauditorofthegroup,andotherauditingbodiessuchasthefiscalauditor,areinvolvedinprocess-independentauditingactivitiesinthecontrolenvironmentoftheCtsgroup.themain process-independentmonitoringmeasures for thegroupaccounting processare theauditingoftheconsolidatedfinancialstatementsbytheindependentgroupauditorandtheauditingofthefinancialstatementssubmittedonformsbythecompaniesincludedinconsolidation.

inthestandalonefinancialstatementsofthesubsidiariesofCtsag,bookkeepingtransactionsaremainlyrecordedbythelocalbookkeepingsystems.inordertopreparetheconsolidatedfinan-cialstatementsoftheCtsgroup,thesubsidiariesaddtotheirrespectivefinancialstatementsbysubmittingfurtherdetailsinstandardisedreportingpackages.allsubmittedreportingpackagesarethen importedviaan interface into theconsolidationsystemoflucanetag toproduce thecon-solidatedfinancialstatements.thelucanetworldconsolidationsoftwarehasbeenusedbyCtsagformanyyearsalreadytopreparetheconsolidatedfinancialstatementsoftheCtsgroup.allconsolidationstepsinvolvedinpreparingtheconsolidatedfinancialstatements–suchascapitalconsolidation,consolidationofassetsorliabilities,ortheeliminationofintercompanyexpensesandprofitsandlosses,includingequitymeasurement–aregeneratedandfullydocumentedinlucanetworld.

themeasuresoftheinternalcontrolsystem,aimedatreliabilityandcorrectnessofaccountinginthegroupcompanies,ensurethattransactionsarerecordedpromptlyandfully,inaccordancewithstatutoryregulationsandthearticlesofincorporation.theyalsoensurethatphysicalinventoryis

27


properlyconducted,thatassetsandliabilitiesarecorrectlyrecognised,measuredandstatedintheconsolidatedfinancialstatements.

thecontrolactivities toensure thataccounting iscorrectandreliable include, forexample, theanalysisoffactsandtrendsbyconductingspecificanalysesofkeyfigures.organisationalsepara-tionofadministrative,executive,settlementandapprovalfunctions,andtheirperformancebydiffer-entpersons,reducesthepossibilityoffraudulentactivities.organisationalmeasuresareaimedatpromptlyandproperlyrecording,inthegroupaccountingsystem,anyrestructuringatenterpriseorgrouplevel,andanychangesintheoperationsofindividualbusinessunits.

theaccountingrulesappliedintheCtsgroup,includingtheaccountingruleslaiddownintheinternationalfinancialreportingstandards(ifrs),stipulatethestandardaccountingpoliciesforthegermanandforeigncompaniesincludedintheconsolidatedfinancialstatementsoftheCtsgroupaswellasspecificformalrequirementstobemetbytheconsolidatedfinancialstatements.inadditiontodefiningthescopeofconsolidation,theaccountingrulesalsocontaindetaileddefinitionsofthespecificelementsinthereportingpackagestobeproducedbythegroupcompanies.theseformalrequirementsstipulate,interalia,themandatoryuseofastandardisedandcompletesetofforms.

Centralisedconductingof impairment tests for thespecificcash-generatingunits (Cgus), fromthegroupperspective,ensuresthatcommonandstandardisedmeasurementcriteriaareapplied.thecashgeneratingunitscorrespondtothegroupreportingentities(segments),i.e.ticketingandliveentertainment.atgrouplevel,regulationalsoextends,forexample,tocentraliseddefinitionoftheparameterstobeappliedwhenmeasuringpensionprovisions.measuresatgrouplevelalsoincludetheprocessingandaggregationofadditionaldatainordertoprepareexternalinformationinthenotessectionandthemanagementreport(includingsignificanteventsafterthebalancesheetdate).

bymeansoftheorganisational,controlandmonitoringsystemsstipulatedwithintheCtsgroup,theinternalcontrolandriskmanagementsystemmakesitpossibletorecord,processandanalysecompany information and to present it properly in thegroupaccounting system.however, thenatureofdiscretionarypersonaldecisions,errorsduringchecks, criminalactsandother circum-stancesmeansthattheycannotbeexcludedentirely,andwillresultinlimitationsintheeffective-nessandreliabilityoftheinternalcontrolandriskmanagementsystem,withtheconsequencethatevengroup-wideapplication of the deployed systems cannot guaranteeabsolute securitywithregardtocorrect,completeandpromptrecordingoffactsinthegroupaccountingsystem.

2.7softwaredevelopment

inordertobroadentherangeofticketing-relatedservices,toutiliseadditionalprocurementsourcesandtocontinuemeetingtherequirementsofeventpromoters,boxofficesandinternetcustomers,theticketsalessystemsarebeingconstantlyimprovedandexpanded.allsoftwaredevelopmentispredominantlycarriedoutbydepartmentswithinthegroup.inthefieldsofticketingandsoftware

28


01.01.2010 - 31.12.2010

01.01.2009 - 31.12.2009

Change

[EUR’000] [EUR’000] [EUR’000] [in %]

Revenue 519,577 466,698 52,879 11.3%Gross profit 146,897 124,437 22,460 18.0%EBITDA 87,996 79,974 8,022 10.0%EBIT 70,556 71,280 -724 -1.0%

Non-recurring items:acquisitioncosts 2,106 0 2,106 -workforcerestructuringcosts 2,730 0 2,730 -legalconsultancycostsinconnectionwiththearbitrationproceedingsagainstlivenation 2,985 0 2,985 -

7,821 0 7,821 -

Amortisation from purchase price allocation 7,278 0 7,278 -

Normalised EBITDA 95,817 79,974 15,843 19.8%Normalised EBIT before amortisation from purchase price allocation 85,655 71,280 14,375 20.2%

financialresult -1,703 216 -1,919 -892.6%Earnings before tax (EBT) 68,853 71,496 -2,643 -3.7%taxes -19,682 -23,307 3,625 -15.6%non-controllinginterest -7,400 -8,246 846 -10.3%Net income after non-controlling interest 41,771 39,943 1,828 4.6%

1purchasepriceallocationofticketcornerholdingagundseeticketsgermanygmbh;cf.page25‘Corporatemanagement’forfurtherexplanations

development,thegrouphasamassedawealthofexpertise.inordertotapintonewmarkets,thegroupisplanningfurtheradvancementsinnewtechnologies,suchaschipticketsormobileticket-ing.softwaredevelopmentcostsarerecognisedasassetsongroupleveliftheymeetthecriteriaspecifiedinias38.Costsnoteligibleforcapitalisationaremainlystatedascostofsales.

noexpenseneedstobestatedunderresearchanddevelopment.

3. earningsperformanCe,finanCialpositionandCashflow3.1 earningsperformanCe3.1.1 groupearningsperformanCe(ifrs)

29


revenue

grouprevenuegrowthisshowninthefollowingtable:

grouprevenueincreasedinthereportingperiodbyeur52.879millionor11%fromeur466.698million toeur519.577million.revenue(beforeconsolidationbetweensegments)breaksdownintoeur193.871million in theticketing segment (prior year:eur152.493million) andeur333.807millionintheliveentertainmentsegment(prioryear:eur318.726million).

theticketingsegmentachievedfurtherrevenuegrowthinthe2010financialyear.revenueinthissegmentrose27%fromeur152.493milliontoeur193.871million.thisencouragingprogressisattributablenotonlytoorganicgrowthinthecoreeuropeanmarkets,especiallyinthehigh-margininternetchannel,butinparticularalsotorecentacquisitions.inthe2010reportingperiod,foreignsubsidiariesgenerateda40%shareoftotalrevenue(prioryear:39%).

inthe2010financialyear,around360millionmusicandeventfans(prioryear:303million)visitedthegroup’sinternetportalsandbought17.1millionticketsintotal(prioryear:13.4million).thisequatestoayear-on-yearincreaseinvolumeofinternetticketofaround28%.

followingitsoutstandingperformancein2009,theliveentertainmentsegmentachievedfurtherrevenuegrowthinthepastfinancialyear.despitetherevenueshortfallduetothedeconsolidationoffkpscorpioanditssubsidiariesasof30June2010,revenuewasincreasedbyeur15.081millionor5%toeur333.807millionasaresultofsuccessfultours,ahighfrequencyofeventsandthecreationofnewtypesofevents.Concert toursbydepechemode,pink,u2,michaelbuble,shakira,a-haandthescorpions, thesuccessfulopen-air festivalsandothereventssuchas the‘dinosaurs–intherealmofthegiants’exhibition,the‘elisabeth’musical,Cirquedusoleilandthe‘tutankhamun’exhibitionboostedrevenuegrowthinthissegment.

of theeur519.577million ingroup revenueachieved in the reportingyear (prior year:eur466.698million),eur394.756millionwasgeneratedingermany(prioryear:eur364.541million),eur53.504millioninaustria(prioryear:eur47.691million),eur27.624millioninswitzerland(prioryear:eur10.381million),eur20.141millioninitaly(prioryear:eur20.335million),andeur23.552millioninothercountries(eur23.750million).

EUR’000

2010200920082007200620052004

342,927256,179

222,746

404,348466,698

519,577

384,375

30


grossprofit

thegrossprofitofthegroupincreasedduringthe2010reportingperiodby18%toeur146.897million.the11%increaseingrouprevenueisoffsetbyalowerproportionalincreaseincostofsales(+9%).asaresult,theconsolidatedgrossmarginincreasedyear-on-yearfrom26.7%to28.3%.

thegrossmarginachievedinthegroupasawholeandinthesegmentsdevelopedasfollows:

in theticketingsegment, thegrossmargin improvedslightly in thecurrent financial year from55.0%to55.2%.intheliveentertainmentsegment,thegrossmarginslippedfrom12.7%in2009to12.0%in2010duetoincreasedcostofsales.

non-reCurringitems

groupearningsinthereportingperiodweretemporarilyburdenedbynon-recurringitemsintheticketingsegment.thesenon-recurringitemswerenormalisedinthereportingperiodandarecom-prisedasfollows:

•eur2.106millionresultingfromacquisitioncosts(since1January2010,accordingtoifrs3r,thosecostscannolongerbecapitalisedasancillarypurchaseexpenses),primarilyforticketcornerholdingagandseeticketgermanygmbh,

•eur2.730millionresultingfromworkforcerestructuring,mainlyinvolvingsettlementsandben-efitstointerimemployment(‘transfer’)companiesand

•eur2.985millionresultingfromlegalconsultancycostsinconnectionwiththearbitrationpro-ceedingsagainstlivenation.

normalisedebitda/ebitda

normalisedgroupebitdaincreasedsignificantlyby20%fromeur79.974milliontoeur95.817million.thenormalisedebitdamarginwasthusincreasedyear-on-yearfrom17.1%to18.4%.themain factorsbehind these improvedearningswere theexcellent performance in theliveenter-tainmentsegment, thegrowthofsalesvolumevia the internet in theticketingsegmentand theacquisitionsmadeduringthereportingperiod.foreignsubsidiariesaccountedforaround18%ofnormalisedgroupebitda,aboutthesamelevelastheyearbefore.theebitdaisteur87.996million,or10%abovetheprior-yearfigure(eur79.974million).

2010 2009[in %] [in %]

group 28.3 26.7ticketing 55.2 55.0liveentertainment 12.0 12.7

31


intheticketingsegment,thenormalisedebitdarosesignificantlybyeur13.822millionfromeur55.435milliontoeur69.257million(+25%).thenormalisedebitdamarginfellfrom36.4%to35.7%.inadditiontothefurtherincreaseinticketvolumessoldthroughtheinternetplatformsoftheCtsgroup,bothinexistingandinnewmarkets,theacquisitionsmadeinthecourseoftheyearalsomadetheirrespectivecontributionstoearnings.absolutenormalisedebitdacontinuedtorisebothdomesticallyandinternationally.intheticketingsegment,foreignsubsidiariesaccountedforaround23%ofnormalisedgroupebitda,nearlyaboutthesamelevelastheyearbefore.theebitdaiseur61.436million,or11%abovetheprior-yearfigure(eur55.435million).

theliveentertainmentsegmentmanagedtosurpassonceagainitsrecordperformanceofthepreviousyear.ebitdainthissegmentrose8%fromeur24.519milliontoeur26.560million.theebitdamarginwas8.0%,comparedto7.7%theyearbefore.successinthisfieldisrootedinthewiderangeofoutstandingeventsonoffer,fromrock,popandsporttomusicals,festivalsandclassicalmusicconcerts,andinthedevelopmentofnewtypesofevents.

normalisedebitbeforeamortisationfrompurChasepriCealloCation/ebit

normalisedgroupebitbeforeamortisationfrompurchasepriceallocation(foranexplanationofthiskeyperformancefigure,cf.page25,‘Corporatemanagement’)increasedsignificantlyby20%fromeur71.280milliontoeur85.655million.thenormalisedebitmarginwas16.5%,comparedto15.3%theyearbefore.theebitiseur70.556million,slightlylowerthattheprior-yearfigure(eur71.280million; -1%).total depreciationandamortisation in thegroup increasedbyeur8.745millionfromeur8.694milliontoeur17.439million.thisriseincludeseur7.278millioninamortisationfrompurchasepriceallocationbytheticketingsegmentcompaniesacquiredduringthereportingperiod.

intheticketingsegment,normalisedebitbeforeamortisationfrompurchasepriceallocationrosebyeur12.059millionor25%fromeur49.041milliontoeur61.100million.thenormalisedebitmarginwasat31.5%after32.2%in2009.theebitiseur46.001million,slightlylowerthantheprior-yearfigure(eur49.041million;-6%).

intheliveentertainmentsegment,theebitfigurerosesignificantlyby11%fromeur22.219mil-liontoeur24.556million.theebitmarginwas7.3%,comparedto7.0%theyearbefore.

finanCialresult

the financial result, ateur -1.703million (prior year:eur+216 thousand) includeseur34thousandinincomefromparticipations(prioryear:eur8thousand),eur-51thousandinincome/expensesfrominvestmentsinassociates(prioryear:eur+140thousand),eur2.473millioninfinancialincome(prioryear:eur2.016million)andeur4.159millioninfinancialexpenses(prioryear:eur1.948million).

thelowerfinancialresultwasmainlyattributabletothehigherinterestexpenseandotherborrow-ingcoststofinancetheacquisitionsmadeduringthecurrentfinancialyear.

thechangeinthepresentvalueofpurchasepriceobligationsinrespectofputoptions(eur94thousand;prioryear:eur1.017million),werestatedas financialexpenses inaccordancewithias32.theyear-on-yearchangewasmainlyduetotheincreasesinshareholdingsinsubsidiariesalreadyincludedinconsolidationduringthe2010financialyear.

32


taXes

taxexpensesdecreasedinfiscal2010byeur3.625milliontoeur19.682million.taxexpensescomprisedeferredtaxincome(eur3.309million;prioryear:deferredtaxexpensesofeur559thousand)andthefactual taxexpensesof theconsolidatedstandalonecompanies(eur22.991million;prioryear:eur22.748million).thedeferredtaxincomeresults,interalia,fromdeferredtaxliabilitiesthatwererecognisedwhenconductingthepurchasepriceallocations,butnotinprofitorloss,andwhichwerereversedthroughprofitandlossintheperiodafterinitialconsolidation.

deferredtaxincomeandtaxexpenseswererecognisedonthebasisofexistinglosscarryforwardsandfortemporarydifferences,andset-offagainsttaxexpenses.fiscallosscarryforwardsforwhichdeferredtaxassetswereformedinthepastarereducedbypositivenetincomeofthestandalonecompaniesandleadtodeferredtaxexpenses.

the taxation rate for thegroup as awhole shows the relationship between taxes (includingdeferredtaxes)andtheearningsbeforetax.thetaxationrateinfiscal2010was28.6%(prioryear:32.6%).onefactoraccounting for thedecrease in taxationratewas thatdeferred taxassetsonfiscal loss carryforwardswere formed throughprofit and loss in the reporting year,whereasnodeferredtaxassetsinrespectoflosscarryforwardscouldbeformedintheprioryear,inparticularinsubsidiariesoffkpscorpio.

non-Controllinginterest

accordingtoias32rules,non-controllinginterestneednotberecognisedincompanieswithcor-respondingputoptions.

thenon-controlling interest stated in the income statement decreasedbyeur846 thousandfromeur8.246milliontoeur7.400million.non-controllinginterestistheshareincurrentprof-itsallocatedtoothershareholders,aswellasdistributionspaidbysubsidiariestonon-controllingshareholderswhosesharesarenotstatedasnon-controllinginterestinshareholders’equityduetoputoptions.

netinComeafternon-Controllinginterest

theconsolidatednet incomeafternon-controllinginterestfortheyear increasedbyeur1.828millionfromeur39.943milliontoeur41.771million.thegroupearningspershare(eps)forthe2010businessyearwaseur1.74(prioryear:eur1.66).

thenetincomefortheyearofCtsagaslistedstandalonecompany,inaccordancewithhgb,waseur26.170million(prioryear:eur27.874million),andthedistributableearningspersharefor theCtsagstandalonecompanywereeur1.09(prioryear:eur1.16).thenet income inaccordancewithhgbwasmainlyadjustedbygoodwillamortisationeliminatedunderifrsandbyancillarypurchaseexpensesthatcannotbecapitalisedinconnectionwithcorporateacquisitions.

33


sellingeXpenses

theeur9.634millionincreaseinsellingexpensesismainlyduetohigherpersonnelexpenses(eur+4.217million), depreciationandamortisation (eur+2.219million)andadvertisingcosts(eur+3.214million).themaindriverbehind the increase insellingexpenseswas thebroaderscopeofconsolidation.asapercentageofrevenue,sellingexpensesincreasedfrom7.4%to8.5%.referenceismadetothe‘personnel’sectiononpage35forthedevelopmentofpersonnelcosts.

generaladministrativeeXpenses

theeur 9.655million increase in general administrative expenses ismainly attributable toincreasedpersonnelexpenses(eur+5.558million),depreciationandamortisation(eur+2.915million)andtocostsforofficepremisesandrent(eur+546thousand).themainfactoraccountingfortheincreaseingeneraladministrativeexpenseswasthebroaderscopeofconsolidation.asapercentageofrevenue,generaladministrativeexpensesincreasedfrom4.1%to5.6%.referenceismadetothe‘personnel’sectiononpage35forthedevelopmentofpersonnelcosts.

otheroperatinginCome

otheroperatingincomeincreasedyear-on-yearbyeur4.819million,mainlyduetohigherincomefromwritten-offliabilities/written-offreceivables(eur+889thousand),incomefromthereversalofallowancesfordoubtfulaccounts(eur1.309million),andincomefromcurrencytranslation(eur+1.296million).otheroperatingincomealsoincludesthegainresultingfromthetransitionfromfullconsolidationtorecognitionatequityoffkpscorpioanditssubsidiaries(eur+428thousand).

mainitemsintheConsolidatedinComestatement

01.01.2010 - 31.12.2010

01.01.2009 - 31.12.2009

Change

[EUR’000] [EUR’000] [EUR’000] [in %]

sellingexpenses 44,047 34,413 9,634 28.0%generaladministrativeexpenses 28,904 19,249 9,655 50.2%otheroperatingincome 13,156 8,337 4,819 57.8%otheroperatingexpenes 16,547 7,832 8,715 111.3%

ofwhichnon-recurringitems 7,821 0 7,821 -

34


otheroperatingeXpenses

theeur8.715millionincreaseinotheroperatingexpensesmainlyincludestheexpensesresult-ingfromtheaforementionednon-recurringitems(eur+7.821million).therewerealsoincreasesinexpensesforthird-partyservices(eur+449thousand)andexpensespassedontothirdparties(eur+383thousand).

personnel

duetolargerworkforces,personnelexpensesincreasedyear-on-yearbyeur19.417millionfromeur44.989milliontoeur64.406million.this increase inpersonnelexpensesstemsfromtheticketingsegment(eur+21.446million),whereaspersonnelexpensesintheliveentertainmentsegmentwerereducedbyeur2.029million.theincreasedpersonnelexpensesintheticketingsegmentwereprimarilyattributabletobusinessexpansionthroughacquisitionsandtheinternation-alisationofthegroup.thereductioninpersonnelexpensesintheliveentertainmentsegmentismainlytheresultofdeconsolidationoffkpscorpioanditssubsidiariesasat30June2010.

breakdownofemployeesbysegment(year-endfigures):

2010 2009[Qty.] [Qty.]

ticketing 1,279 691liveentertainment 200 452Total 1,479 1,143

attheendofthefinancialyear,thegrouphadatotalof1,479employees(prioryear:1,143);thisfigurebreaksdown into942employees ingermany(prioryear:652),131employees inaustria(prioryear:184),79employeesinitaly(prioryear:69),103employeesinswitzerland(prioryear:24)and224employeesinothercountries(prioryear:214).duetothebroaderscopeofconsolida-tionintheticketingsegment,thenumberofemployeesincreasedby578asat31december2010,whereasdeconsolidationoffkpscorpioanditssubsidiariesresultedin279feweremployeesintheliveentertainmentsegment.

onaverageduring2010,thegrouphad591moreemployeesthaninthe2009financialyear.

35


developmentofthetiCketingandliveentertainmentsegments

tiCketing

Ticketing 2007 2008 2009 2010[EUR million] [EUR million] [EUR million] [EUR million]

revenue 87.4 120.1 152.5 193.9grossprofit 50.1 67.1 83.9 106.9grossmargin 57.3% 55.9% 55.0% 55.2%normalisedebitda 32.0 40.1 55.4 69.3normalisedebitbeforeamortisationfrompurchasepriceallocation 26.6 34.6 49.0 61.1

Live Entertainment 2007 2008 2009 2010[EUR million] [EUR million] [EUR million] [EUR million]

revenue 301.3 288.0 318.7 333.8grossprofit 33.4 30.4 40.5 40.0grossmargin 11.1% 10.6% 12.7% 12.0%ebitda 21.8 17.7 24.5 26.6ebit 20.5 15.7 22.2 24.6

liveentertainment

ofthetotalrevenueinthissegment,eur105.221million(prioryear:eur84.645million)weregeneratedviatheinternet,equivalenttointernetrevenuegrowthof24%.revenuegeneratedviatheinternetaccountedfor54%oftotalticketingsegmentrevenueinthe2010financialyear(prioryear:56%).

theliveentertainmentsegmentimprovedonceagainonitsrecordperformancetheyearbefore,thusachieving thebest-everearningssincetheipoin2000.despite fewermajor tours,a largenumberofwell-attendedeventsin2010resultedinfurtherimprovementsinearningsandmargins.

36


3.1.2 earningsperformanCeofCtsag(hgb)

01.01.2010 - 31.12.2010

01.01.2009 - 31.12.2009

Change

[EUR’000] [EUR’000] [EUR’000] [in %]

Revenue 86,348 85,077 1,271 1.5Gross profit 47,598 48,135 -537 -1.1EBITDA 31,089 36,527 -5,438 -14.9EBIT 27,551 33,028 -5,477 -16.6

Non-recurring items:acquisitioncosts 829 0 829 -legalconsultancycostsinconnectionwiththearbitrationproceedingsagainstlivenation 2,985 0 2,985

-

3,814 0 3,814 -

Normalised EBITDA 34,903 36,527 -1,624 -4.4Normalised EBIT 31,365 33,028 -1,663 -5.0

financialresult 7,869 6,372 1,497 23.5Earnings before tax 35,420 39,400 -3,980 -10.1taxes -9,250 -11,526 2,276 -19.7Net income for the year 26,170 27,874 -1,704 -6.1

inthe2010businessyear,Ctsagrevenueincreasedbyeur1.271millionfromeur85.077mil-liontoeur86.348million.growingrevenuefromsoftwarelicensing,combinedwithfurthergrowthinbothinternetticketingvolumeandticketsalesinthecorebusinesswerethemajorfactorsbehindthispositivegrowthinrevenue.incontrasttothepositivegrowthinonlineticketingvolume,asmallernumberofmajortoursresultedinloweraveragerevenueperinternetticketinthereportingyear,comparedwiththeyearbefore.therewasalsoayear-on-yeardropinrevenuefromthelivenationagreement(northamerica),duetoterminationoftheagreementinJune2010.

grossprofitdecreasedslightlyby1%year-on-year.inadditiontothenegativeeffectonrevenueperinternetticket,mentionedaboveinconnectionwithrevenue,highercostofsalesduemainlytoanincreasingproportionofpersonnelcostsasaresultoffurtherinternationalisationofthegroupasawhole,aswellashighercostsforpurchasedgoodsandservices,ledtoaslightlylowergrossmarginof55.1%,comparedto56.6%theyearbefore.

Ctsagearningsweretemporarilyburdenedbynon-recurringitemsinthereportingyear.thesenon-recurringitemsincludeeur829thousandinacquisitionandintegrationcostsinrespectoftheparticipations in theticketcornergroupand theseeticketgermany /ticketonlinegrouppur-chasedduringthereportingyear,andeur2.985millionlegalconsultancycostsinconnectionwiththearbitrationproceedingsagainstlivenation.

37


normalisedebitda fell by 4.4% (eur -1.624million) toeur34.903million; the normalisedebitdamarginwasreducedfrom42.9%intheprioryearto40.4%.normalisedebitamountstoeur31.365million(prioryear:eur33.028million),withnormalisedebitmarginat36.3%(prioryear:38.8%).theearningsfiguresforthereportingyearwerenegativelyaffectedbythenegativepriceeffectinrespectofloweraveragerevenueperinternetticket(duetofewermajoreventscom-paredto2009)andbyhighercostsforinternationalisationofthegroup(includingadditionalperson-nel,costsforofficepremisesandtravelexpenses).theabsenceofroyaltiesfromthelivenationagreement(northamerica)alsoledtoayear-on-yeardropinearningsinthesecondhalfof2010.

anebitdaofeur31.089million (prior year: eur36.527million)was achieved.theebitamountedtoeur27.551million(prioryear:eur33.028million).

thefinancialresultincreasedbyeur1.497million,fromeur6.372millionthepreviousyeartoeur7.869million.thefinancialresultincludeseur9.192millioninincomeintheformofdividendsandtransferredprofitsfromparticipations(prioryear:eur5.513million),eur1.342millionininter-estincome(prioryear:eur1.096million),eur2.248millionininterestexpenses(prioryear:eur237thousand),andotherfinancialexpensesamountingtoeur417thousand(prioryear:eur0).

theeur246thousandincreaseininterestincomemainlyresultedfromhigherinterestforloanstosubsidiaries.theeur2.011millionincreaseininterestexpensesrelatesprimarilytointerestsforlong-termloans,whichincreasedsubstantiallyinthefinancialyearduetothefinancingofnewpar-ticipations.otherfinancialexpensesrelatelikewisetoexpensesincurredinconnectionwithloanstakenoutduringthereportingyear.

taxexpensesfellbyeur2.276millionfromeur11.526milliontoeur9.250million.themaincauseofthisdecreasewasthelowerprofitfromordinarybusinessactivities(ebt)aswellashigherincomefromparticipationsatalowrateoftaxation.thetaxationratefellfrom29.3%thepreviousyearto26.1%in2010.

the net income for the year, in accordancewithhgb, decreased on account of the factorsdescribedabovefromeur27.874milliontoeur26.170million.

38


mainitemsintheConsolidatedinComestatement

sellingexpensesrosebyeur2.770milliontoeur13.704million.theincreaseismainlyduetohigherproportionalpersonnelexpenses(eur+983thousand),higherimpairmentsofreceivablesinthereportingyear(eur+1.374million)andincreasedproportionalcostsforpremises(eur+231thousand).asapercentageofrevenue,sellingexpensesincreasedfrom12.9%to15.9%.

theeur335thousandincreaseingeneraladministrativeexpensesinthereportingyear,toeur5.673million,ismainlyattributabletohigherpersonnelexpenses(eur+482thousand).asaper-centageofrevenue,generaladministrativeexpensesincreasedfrom6.3%to6.6%.

otheroperatingincomeincreasedbyeur2.380milliontoeur6.371million.thisincreasewasmainlyattributabletohigherincomefromthedisposalofassets(eur+952thousand),commissionincome(eur+688thousand), incomefromwritten-offreceivablesandwritten-off liabilities(eur+427thousand)andincomefrompassedonexpenses(eur+368thousand).

theincreaseinotheroperatingexpensesfromeur4.215milliontoeur7.041millionismainlytheresultofexpensesrecognisedasnon-recurringitems(eur+3.814million).expensespassedontothirdpartiesalsoincreased(eur+359thousand).

attheendofthe2010financialyear,Ctsaghad165employeesonitspayroll(prioryear:139).personnelexpensesincreasedbyeur1.929millionfromeur9.428milliontoeur11.357mil-lion,duetothefurtherinternationalisationofthegroup,implementationofitsacquisitionstrategyandtothegreatercomplexityandcentralisationoffunctionsfromindividualsubsidiariesthatthesechangesinvolve.

01.01.2010 - 31.12.2010

01.01.2009 - 31.12.2009

Change

[EUR’000] [EUR’000] [EUR’000] [in %]

sellingexpenses 13,704 10,934 2,770 25.3generaladministrativeexpenses 5,673 5,338 335 6.3otheroperatingincome 6,371 3,991 2,380 59.6otheroperatingexpenses 7,041 2,826 4,215 149.2ofwhichnon-recurringitems 3,814 0 3,814 -

39


31.12.2010 31.12.2009 Change

[EUR’000] [in %] [EUR’000] [in %] [EUR’000]

Current assetsCashandcashequivalents 178,036 27.1 229,794 49.8 -51,758tradereceivables 31,893 4.9 19,799 4.3 12,094receivablesfromaffiliatedandassociatedcompanies 6,979 1.1 3,566 0.8 3,413inventories 19,315 2.9 15,571 3.4 3,744otherassets 51,894 7.9 56,527 12.1 -4,633Total current assets 288,117 43.9 325,257 70.4 -37,140

Non-current assetsfixedassets 111,316 17.0 33,582 7.3 77,734goodwill 254,259 38.7 96,929 21.0 157,330tradereceivables 212 0.0 1,268 0.3 -1,056receivablesfromaffiliatedcompanies 0 0.0 1,186 0.2 -1,186otherassets 201 0.0 2,303 0.5 -2,102deferredtaxassets 2,364 0.4 1,360 0.3 1,004Total non-current assets 368,352 56.1 136,628 29.6 231,724

Total assets 656,469 100.0 461,885 100.0 194,584

3.2 finanCialposition3.2.1 groupfinanCialposition(ifrs)

40


thebalancesheetitemsasat31december2010and31december2009arecomparable.theacquisitionsmadein2010andtheassociatedlong-termexternalloansledtosubstantialchangesinanumberofbalancesheetitems.

Current assets decreasedbyeur37.140million toeur288.117million.this is attributableabovealltoaeur51.758milliondecreaseincashandcashequivalentstoeur178.036million;tradereceivablesincreased,incontrast,byeur12.094milliontoeur31.893million.

theeur51.758millionreductionincashandcashequivalentsresultsprimarilyfromlessticketmoniesintheticketingsegmentandlessadvancepaymentsreceivedintheliveentertainmentsegment.thiswasbecausethemajortoursforwhichpre-salesbeganinthefourthquarterof2009(especiallytheaC/dCandu2)thenledtoconsiderableamountsofnetcashinflow,comparedtowhichtherewerenosimilarmajoreventsinthefourthquarterof2010.paymentsforincreasesinshareholdingsinsubsidiariesalreadyincludedinconsolidationalsohadeffectsinthereportingyear.

31.12.2010 31.12.2009 Change

[EUR’000] [in %] [EUR’000] [in %] [EUR’000]

Current liabilitiesshort-termfinancialliabilitiesandcurrentportionoflong-termfinancialliabilities

6,567

1.0

25,218

5.5

-18,651

tradepayables 38,743 5.9 35,890 7.8 2,853payablestoaffiliatedandassociatedcompanies 2,920 0.5 1,230 0.2 1,690advancepaymentsreceived 64,550 9.8 101,766 22.0 -37,216provisions 12,745 1.9 11,409 2.5 1,336otherliabilities 150,379 22.9 125,039 27.1 25,340Total current liabilities 275,904 42.0 300,552 65.1 -24,648

Non-current liabilitiesmedium-andlong-termfinancialliabilities 199,791 30.5 7,961 1.7 191,830otherliabilities 320 0.0 12 0.0 308pensionprovisions 4,417 0.7 2,716 0.6 1,701deferredtaxliabilities 17,930 2.7 780 0.2 17,150Total non-current liabilities 222,458 33.9 11,469 2.5 210,989

Shareholders’ equitysharecapital 24,000 3.7 24,000 5.2 0Capitalreserve 23,311 3.6 23,311 5.0 0retainedearnings 98,035 14.9 97,869 21.2 166treasurystock -52 0.0 -52 0.0 0non-controllinginterest 11,431 1.7 4,946 1.1 6,485othercomprehensiveincome 22 0.0 52 0.0 -30Currencydifferences 1,360 0.2 -262 -0.1 1,622Total shareholders’ equity 158,107 24.1 149,864 32.4 8,243

Total shareholders’ equity and liabilities 656,469 100.0 461,885 100.0 194,584

41


Cashandcashequivalents,ateur178.036million (prioryear:eur229.794million), includeticketmoniesfrompre-salesforeventsin2011(ticketsnotyetinvoicedintheticketingsegment),whichare reportedunder other liabilities (eur116.767million; prior year:eur94.249million).otherassetsalsoincludereceivablesrelatingtoticketrevenuefrompre-salesintheticketingseg-ment(eur19.512million;prioryear:eur27.538million).

theeur12.094million increase in trade receivables isprimarilydue to thebroaderscopeofconsolidation.

non-currentassetsincreasedbyeur231.724milliontoeur368.352million.significantchangesoccurredinfixedassets(eur+77.734million)andingoodwill(eur+157.330million).

theeur77.734million increase in fixed assetsmainly relates to the intangible assets (cus-tomerbaseandsoftware)fromthefinalpurchasepriceallocationoftheswissticketcornergroupacquiredinthefirstquarterof2010,andtotheprovisionalpurchasepriceallocationofseeticketsgermany/ticketonlinegroup,acquiredinJuly2010,inadditiontocapitaliseddevelopmentcostsintheticketingsegmentandexhibitioninventoryintheliveentertainmentsegment.

theeur157.330million increase ingoodwill (takingcurrency translation intoaccount)mainlyresultsfromthepurchasepriceallocationofthecompaniesacquiredintheticketingsegmentdur-ingthereportingyear(eur+159.342million).intheliveentertainmentsegment,thetransitionoffkpscorpioanditsubsidiariesfromfullconsolidationtorecognitionatequityledtoadisposalofgoodwillamountingtoeur2.001million.withtheexceptionofthenewacquisitionsfinancedwithexternalloans,allinvestmentswithinthegroupwerefinancedfromfreecashflow.

long-termassetsaccountfor56%ofthebalancesheettotal(prioryear:30%).duetothecapi-talisedassetsformedbythepurchasepriceallocationofthenewlyacquiredcompanies,long-termassetsarenotcompletelyfinancedbyshareholders’equityanymore.

Currentliabilitiesdecreasedbyeur24.648milliontoeur275.904million.Changesmainlyaroseinrespectofcurrentfinancialliabilitiesandthecurrentportionoflong-termfinancialliabilities(eur-18.651million),and in respectofadvancepayments received(eur-37.216million).theseareoffsetbyaeur25.340millionincreaseinotherliabilities.

theeur18.651milliondecreaseincurrentfinancialliabilitiesandcurrentportionsoflong-termfinancialliabilitiesresultedmainlyfromreducedliabilitiesfromtherecognitionofputoptions,sincesharesinasubsidiarythathadalreadybeenincludedinconsolidationweretenderedandsubse-quentlyaccepted.

theeur-37.216millionchangeinadvancepaymentsreceivedismainlyattributabletothefactthatticketmonieswerereceivedinthefourthquarteroftheprioryearfrompre-salesofmajortoursin2010(includingu2ingermanyandaC/dCinaustria).inthecurrentreportingyear,therewerenopre-salesofsimilardimensionsinthefourthquarterformajortours,soadvancepaymentsreceiveddecreasedaccordingly.advancepaymentsreceivedintheliveentertainmentsegmentaretrans-ferredtorevenuewhentherespectiveeventshavetakenplace.

theeur25.340millionincreaseinotherliabilitiesmainlypertainstoincreasedliabilitiesinrespectofticketmoniesnotyetinvoicedintheticketingsegment;theseweremainlyduetothebroaderscopeofconsolidation.

42


non-current liabilities rosebyeur210.989million,mainlydue toan increase inmedium-andlong-term financial liabilities (eur+191.830million)and indeferred tax liabilities (eur+17.150million).

theeur191.830millionincreaseinmedium-andlong-termfinancialliabilitiesaroseprimarilyinconnectionwiththeexternalborrowingtofinancethepurchaseofsharesintheticketcornergroupandtheseeticketgermany/ticketonlinegroup.

theeur+17.150millionchange indeferred tax liabilitiesmainly results from temporarydiffer-encesarisingfromthefairvaluemeasurementofintangibleassetsinthecontextofthepurchasepriceallocationoftheticketcornergroupandtheseeticketgermany/ticketonlinegroup.

shareholders’equityrosebyeur8.243milliontoeur158.107million.thisincreaseismainlyattributabletoanincreaseinnon-controllinginterest(eur+6.485million),whichmostlyresultedfromtheshareincurrentconsolidatedearnings.theeur+166thousandchangeinretainedearn-ingsarosefromthepositiveconsolidatedearningsfor2010,ateur+41.771million,offsetbythereductioninshareholders’equityasaresultoftheeur19.918millionpaidoutasdividendforthefinancialyear2009,andbytheeur19.333millionpaidoutforadditionalsharesinasubsidiaryintheliveentertainmentsegmentthatwasalreadyfullyconsolidated.accordingtoifrs3randias27r,andwitheffectfrom1January2010,anyincreasedinvestment,withoutaputoption,inacompanythatisalreadyfullyconsolidatedisrecognisedasatransactionbetweenshareholdersinshareholders’equity.

in accordancewith ias32, theCtsgrouphasapplied the standard to equity instruments ofnon-controllingshareholdersholdingputoptions.theputoptionsheldbycertainnon-controllingshareholdersarethereforedisclosedunderfinancialliabilitiesandnotasnon-controllinginterest.

theequityratio(shareholders’equitydividedbythebalancesheettotal)decreasedfrom32.4%to24.1%,mainlyduetotheincreaseinbalancesheettotalasaresultofnewacquisitions.

thereturnonequity(netincomeafternon-controllinginterestdividedbyshareholders’equity)is26.4%comparedto26.7%in2009.

43


31.12.2010 31.12.2009 Change

[EUR’000] [in %] [EUR’000] [in %] [EUR’000]

Current assetsCashandcashequivalents 38,417 11.5 86,732 42.7 -48,315treasurystock 0 0.0 63 0.0 -63tradereceivables 5,726 1.7 5,069 2.5 657receivablesfromaffiliatedcompanies 13,111 3.9 18,124 8.9 -5,013inventories 404 0.1 728 0.4 -324prepaidexpensesandotherassets 19,938 6.0 15,394 7.6 4,544Total current assets 77,596 23.2 126,110 62.1 -48,514

Non-current assetsfixedassets 251,480 75.3 73,243 36.0 178,237goodwill 1,145 0.3 1,472 0.7 -327receivablesfromaffiliatedcompanies 1,185 0.4 1,146 0.6 39prepaidexpensesandotherassets 2,774 0.8 1,234 0.6 1,540Total non-current assets 256,584 76.8 77,095 37.9 179,489

Total assets 334,180 100.0 203,205 100.0 130,975

3.2.2 finanCialpositionofCtsag(hgb)

44


31.12.2010 31.12.2009 Change

[EUR’000] [in %] [EUR’000] [in %] [EUR’000]


500

0.2

500

0.3

0

tradepayables 7,536 2.3 4,792 2.3 2,744liabilitiestoaffiliatedcompanies 2,204 0.6 531 0.3 1,673provisions 5,566 1.7 8,759 4.3 -3,193deferredincomeandotherliabilities 52,594 15.7 73,532 36.2 -20,938Total current liabilities 68,400 20.5 88,114 43.4 -19,714

Non-current liabilitiesmedium-andlong-termfinancialliabilities 148,500 44.4 4,000 2.0 144,500deferredtaxliabilities 44 0.0 0 0.0 44Total non-current liabilities 148,544 44.4 4,000 2.0 144,544

Shareholders’ equitysharecapital 24,000 7.2 24,000 11.8 0

lessparvalueoftreasurystock -2 0.0 0 0.0 -2Capitalreserve 23,821 7.1 23,821 11.7 0treasurystockreserve 0 0.0 63 0.0 -63balancesheetprofit 69,417 20.8 63,207 31.1 6,210Total shareholders’ equity 117,236 35.1 111,091 54.6 6,145

Total shareholders’ equity and liabilities 334,180 100.0 203,205 100.0 130,975

45


thebalancesheettotalofCtsagincreasedyear-on-yearbyeur130.975million,or64%,toeur334.180million.thechangesontheassetssideweremainlydueto thedecrease incashandcashequivalents(eur-48.315million),theincreaseinfixedassets(eur+178.237million)andtoincreasesinprepaidexpensesandotherassets(eur+6.084million).thechangesontheshareholders’equityandliabilitiessideresultprimarilyfromtheincreaseinfinancialliabilities(eur+144.500million)andfromthedecreaseindeferredincomeandotherliabilities(eur-20.938mil-lion).

Currentassetsdecreasedbyeur48.514million,or39%,toeur77.596million.thechangesmainlyderivefromtheeur48.315milliondecreaseincashandcashequivalentsandtheeur5.013milliondecreaseinreceivablesfromaffiliatedcompanies.theseareoffsetbyaeur4.544millionincreaseinprepaidexpensesandotherassets.

Cashandcashequivalentsfellinthefinancialyearbyeur48.315millionfromeur86.732milliontoeur38.417million.asignificantcontributiontothisdeclineincashandcashequivalentswasmadebytheeur20.589milliontofinanceincreasedshareholdingsinticketones.p.a..inaddi-tion,theticketmoniesfrompre-salesforeventsinthefollowingyear(ticketmoniesnotyetinvoiced),whichareincludedincashandcashequivalents,areeur21.823millionloweryear-on-year.thisisbecausethemajortoursforwhichpre-salesbeganinthefourthquarterof2009(especiallytheaC/dCtouringermany)thenledtoconsiderableamountsofnetcashinflow,comparedtowhichtherewerenosimilarmajoreventsinthefourthquarterof2010.

receivablesfromaffiliatedcompaniesdecreasedbyeur5.013millionthisdropwasmainlytheresultof lower receivables from loansandprofit distributions (eur -4.566million)and from thedeclineintradereceivables(eur-624thousand).

theeur4.544millionincreaseinprepaidexpensesandotherassetsderivesfromtheincreaseinprepaidexpenses(eur+635thousand)andfromincreasesinotherassets(eur+2.674million).the increasedamountofotherassetsmainly includeshigher receivables from income tax.thereceivablesrelatingtoticketrevenuefrompre-sales(eur8.992million;prioryear:eur9.296mil-lion),whichareincludedinotherassets,variedslightlyyear-on-yearbyeur-304thousand.

non-currentassetsincreasedbyeur179.489million,or+233%,toeur256.584million,witheur178.237millionofthatincreasebeingfixedassets,andeur1.540millionresultsfromhigherprepaidexpensesandotherassets.

additionstoassets,ateur185.908million,areoffsetbyeur3.210millionindepreciationandamortisationandeur4.461millionindisposals.oftheadditionstoassets,eur182.187millionareadditionstofinancialassets.thesemainlyrelatetotheacquisitionofseeticketgermany/ticketonlinegroup,comprisingpurchasecostsofeur134.227million,eur11.260millioninlong-termreceivablestakenoverfrompreviousshareholders,andtothepurchaseoftheremainingsharesintherussianfirmofCtseventimruo.o.o.(eur1.476million).therewerealsoincreasesinthevaluesofparticipationsfollowingsharecapitalincreasesintheeventimonlineholdinggmbhacqui-sitioncompany,foracquiringtheremainingsharesintheitalianfirmofticketones.p.a.viatheputoptionagreementalreadyrecognisedintheconsolidatedbalancesheetofthegroup(eur24.661million),andduetothecapitalinvestedinthenewlyestablishedeventimChagastheacquisitioncompanyfortakingovertheticketcornergroup(eur8.902million).additionstointangibleassetsamounttoeurteur2.931millionandmainlyresultfromfurtherdevelopmentoftheglobalticket-ingsystem(eur2.736million).investmentsinoperatingandofficeequipmentamountedtoeur790thousand,ofwhicheur522thousandwereforithardwareforoperatingtheglobalticketing

46


systemandeur143thousandforithardwarefortheboxofficesconnectedtotheCtsticketingsoftwaresystem.theinvestmentsinfinancialassetsforacquisitionswerepredominatelyfinancedwithexternalloans.otheradditionswerefinancedfromfreecashflow.

oftheeur1.540millionincreaseinnon-currentprepaidexpensesandotherassetstoeur2.774million,eur2.774million relates todeferredcosts for interimexternal financingandpostponedreschedulingofdebtswithlong-termexternalloansforthenewacquisitionsmadeinthereportingyear.thisisoffsetbyaeur1.234milliondecreaseinotherassetsduetoanimpairmentmadeinthereportingyear.

Currentliabilitiesdecreasedbyeur19.714milliontoeur68.400million,mainlyduetoareduc-tioninotherliabilitiesrelatingtoticketmoniesnotyetinvoiced(eur-21.823million).thisdecreaseinticketmoniesnotyetinvoicedispartlyattributabletothefactthat,comparedtothepreviousyear,therewerefewermajoreventsandtoursinpre-salesattheendoftheyear.whiletradepayablesroseyear-on-yearbyeur2.744milliontoeur7.536millionandliabilitiestoaffiliatedcompaniesbyeur1.673milliontoeur2.204million,provisionsfellbyeur3.193milliontoeur5.566million.

non-currentliabilitiesincreasedbyeur144.544milliontoeur148.544million.asatthebalancesheetdate,medium-and long-termfinancial liabilitieswereeur144.500millionhigher,ateur148.500million(prioryear:eur4.000million);thedifferencewasalmostentirelyduetoloanstakenouttofinancetheacquisitionofnewparticipations.

shareholders’equityrosebyeur6.145milliontoeur117.236million.thenetincomefortheyear,ateur26.170million,isoffsetbytheeur19.918milliondividendforthe2009financialyearthatwasadoptedattheannualshareholders’meetingin2010.

therewerealsochangesduetofirst-timeapplication,inaccordancewitharticle66(3)sentence1oftheintroductoryacttothegermanCommercialCode(eghgb),ofthegermanaccountinglawmodernisationact,whichenteredintoforceon29may2009(bilanzsrechtsmodernisierungsgesetz;hereinafter:bilmog;applicableasfrom1January2010).forthefirsttime,thearithmeticparvalueofownshareshadtobeclearlydistinguishedfromthesharecapital(eur2thousand).thediffer-encebetweentheparvalueandthefairvalueonthebalancesheetdatewasrecognisedinthereportingyear,thusreducingthebalancesheetprofit(eur-61thousand).thereversalofreservesfor treasurystock(eur-63thousand)thatwasrequired inthisconnection ledtoan increaseinthebalancesheetprofit(eur+63thousand).accordingtobilmog,itwasalsonecessarytoformdeferredtaxliabilitiesinthereportingyear,whichlikewisereducedthebalancesheetprofit(eur-44thousand).

theequityratiodecreasedfrom54.6%to35.1%,mainlyduetothefinancialliabilitiesthatwereenteredinto;thiswasoffsetbytheincreaseinbalancesheetprofit.

thereturnonequity(netincomefortheyeardividedbyshareholders’equity)is22.3%,comparedto25.1%in2009.

47


theamountofcashandcashequivalentsshowninthecashflowstatementcorrespondstothecashandcashequivalentsstatedinthebalancesheet.Comparedto31december2009,cashandcashequivalentsdecreasedbyeur51.758milliontoeur178.036million.

Cashflowfromoperatingactivitiesisderivedindirectlyfromtheconsolidatednetincomefortheyear,whereascashflowfrominvestingandfinancingactivities iscalculatedon thebasisofpay-ments.

CashflowfromoperatingaCtivities(1)

Cash flow fromoperatingactivitiesdecreased year-on-year byeur -43.535million fromeur55.052million toeur11.517million.theyear-on-year change in cash flowwasmainlydue toa lower period-on-period increase in liabilities (eur -74.807million), to increasedpaymentsonincome taxes (eur -9.177million) and to changes inother non-cashexpenses / income (eur-6.476million).thesewereoffsetbypositivecashfloweffectsresultingfromchangesinreceivablesandotherassets(eur+41.488million)andfromanincreasedcashflow(eur+4.549million).

thenegativecash-floweffectofeur-74.807million fromchanges in liabilitieswasmainly theresultofadvancepaymentsreceivedintheliveentertainmentsegment(eur-48.963million)andofliabilitiesaccruingintheticketingsegmentfromticketingmoniesthathavenotyetbeeninvoiced(eur-20.346million).thechanges(reduction)inadvancepaymentsreceivedisattributabletoanincreasedvolumeofticketmoniesbeingreceivedinthefourthquarter2009frompre-salesformajortours in2010(includingu2 ingermanyandaC/dCinaustria),whereas in thecurrentreportingyeartherewerenopre-salesofsimilardimensionsformajortoursin2011.forthesamereason,theliabilitiesforticketmoniesthathavenotyetbeeninvoiceddecreasedaccordinglyyear-on-year(includingaC/dCgermany).

3.3 Cashflow3.3.1 groupCashflow(ifrs)

01.01.2010 - 31.12.2010

01.01.2009 - 31.12.2009

Change

[EUR’000] [EUR’000] [EUR’000]

Cash flow from:operatingactivities 11,517 55,052 -43,535investingactivities -133,963 -14,971 -118,992financingactivities 69,761 -23,359 93,120

Net increase / decrease in cash and cash equivalents -52,685 16,722 -69,407 netincrease/decreaseincashandcashequivalentsduetochangeinscopeofconsolidation -1,224 0 -1,224netincrease/decreaseincashandcashequivalentsduetocurrencytranslation 2,151 0 2,151Cashandcashequivalentsatbeginningofperiod 229,794 213,072 16,722Cash and cash equivalents at end of period 178,036 229,794 -51,758

48


theeur9.177millionincreaseinincometaxespaidismainlyattributabletohigherprepaymentsfor the2010 financialyear, to retrospective taxpayments for the2009 financialyearand to thegreaternumberofcompaniesincludedinconsolidation.

incomparisontothepreviousyear,theeur-6.476millionchangeinothernon-cashexpenses/incomespecificallyincludeslowerexpensesfromthecompoundingofliabilitiesinrespectofputoptionagreements(ias32)aswellaslowerexpensesfromadditionstoallowancesfordoubtfulaccounts.inaddition,increasedamountsofnon-cashexpenses/incomearoseinthereportingyearfromthereversalofallowancesfordoubtfulaccounts.

thepositivecashfloweffectofeur+41.488millionderivingfromyear-on-yearchangesinreceiv-ablesandotherassetsismainlyattributabletothefactthat,asatthe31december2009reportingdate,therewasahighervolumeofreceivablesfromticketpre-saleswhichweresettledinthecur-rent2010financialyear(eur+20.111million).receivablesfromticketmoniesincludecurrentticketmoneyreceivables,interaliaduefromcreditcardanddirectdebitpayments.apositiveinfluenceoncashflowwasalsoexertedduringthereportingperiodbythechangeinreceivablesfornewtypesofeventandbythechangeinreceivablesinrespectofsecuritydeposits.

CashflowfrominvestingaCtivities(2)

Cashoutflowforinvestingactivitiesrosebyeur118.992milliontoeur133.963million.invest-mentsinthereportingyearmainlyincludedthepaymentfortheacquisitionofsharesinseeticketgermany/ticketonlinegroup(eur133.209millionbalancedagainsteur7.777millionincashandcashequivalentstakenover),investmentsinintangibleassets(eur9.487million),interaliaforsoftwaredevelopmentservicesandcustomerbase,aswellasinvestmentsinproperty,plantandequipment(eur6.176million).

CashflowfromfinanCingaCtivities(3)

Cashflowfromfinancingactivitiesincreasedyear-on-yearbyeur93.120milliontoeur+69.761million,mainlydue tohigher levelsofexternalborrowing (eur+186.425million) to finance theacquisitionsmadeduringthecurrentfinancialyear,andtoproceedsreceivedfromthechangeinsharesinsubsidiaries(eur+5.419million).thesewereoffsetbycashoutflowfortheredemptionof financial liabilities takenover from the former shareholders in the context of theticketcornergroupandseeticketgermany/ticketonlinegroupacquisitions(eur-55.693million)andfortheacquisitionofadditionalsharesinsubsidiariesalradyincludedinconsolidation(eur-32.433million).anincreaseinbankloanrepayment(eur-4.785million)aswellasincreaseddistributionstoshareholders(eur-5.280million)alsoproducedanegativecashfloweffect.

49


01.01.2010 - 31.12.2010

01.01.2009 - 31.12.2009

Change

[EUR’000] [EUR’000] [EUR’000]

Cash flow from:operatingactivities 3,266 17,993 -14,727investingactivities -176,163 -4,695 -171,468financingactivities 124,582 -15,139 139,721

Net increase / decrease in cash and cash equivalents -48,315 -1,841 -46,474 Cashandcashequivalentsatbeginningofperiod 86,732 88,573 -1,841Cash and cash equivalents at end of period 38,417 86,732 -48,315

theeur186.732millioninloanstakenoutinthereportingyearincludemainlythefollowinglong-termloanliabilities:

•eur100millionamortisableloanwithatermofeightyears

•eur45millionfinal-maturityloanagainstpromissorynotes,withatermoffiveyears

•Chf52millionasacombinationofamortisableloanandfinal-maturityloan,withatermoftenyears.

thegreaterpartoftheloansareatfixedinterestratesforperiodsbetweenthreeandtenyears.

asatthebalancesheetdate,theCtsgrouphaseur178.036millionincashandcashequiva-lents(prioryear:eur229.794million).

with its current funds, thegroup isable tomeet its financial commitmentsatall timesand tofinanceitsplannedinvestmentsandongoingbusinessoperationsfromitsownfunds.

3.3.2 CashflowCtsag(hgb)

50


Cash flow from operating activitiesdeclinedeur14.727milliontoeur3.266million.themainfactorsaccountingforthisdecreaseareexplainedbelow.

theoperativecashflowofeur29.707millionincludedinthecashflowfromoperatingactivitieschanged in comparisonwith thepreviousyear (eur31.374million)primarilyasa result of theslightlyreducednetincomefortheyear(eur-1.704million).

thechange(increase)inreceivablesin2010waseur12.286millionlessthantheincreaseinreceivablesin2009.thesubstantiallyhigherincreaseinreceivablesin2009wasprimarilycausedbyonce-onlyeffectsrelatingtoreceivablesfornewtypesofevent,andtoreceivablesfromaffiliatedcompaniesfordevelopingnewmarketsineurope.

thechangeinprovisionsyear-on-yearbyeur-2.281millionwascausedmainlybydecreasingtaxprovisions.

thechangeintradepayablesandinpayablestoaffiliatedcompaniesledinaperiod-on-periodcomparisontoapositivecashfloweffectofeur6.878million.

the change resulting from the increase in liabilities for ticketmonies that have not yet beeninvoicedwaslessin2010thanin2009;inayear-on-yearcomparison,thismeantthatthepositivecashfloweffectcouldnotbeenhancedduetothecreationofliabilities,sincetherewaslesscashinflowin2010,especiallyinthefourthquarter,duetotheabsenceofmajortours.theseliabilitieswere reducedbyeur21.823million in the2010reportingyear,whereas in2009 therewasanincrease in liabilitiesofeur7.168million.Compared to the2009reportingperiod, this led toanegativecashfloweffectofeur28.991million.

Cash outflow for investing activitiesincreasedbyeur171.468milliontoeur-176.163million,particularlydue to investments inconnectionwith theacquisitionofshares insubsidiaries (eur-177.882million).thesespecificallyinvolvedtheacquisitionofseeticketgermany/ticketonlinegroup(purchasecosteur-134.227million;eur-11.260million in long-termreceivables takenoverfromformershareholders)andthepurchaseoftheremainingsharesintherussianfirmofCtseventimruo.o.o.(eur-1.476million).investmentsalsoincludedsharecapitalincreasesintheeventimonlineholdinggmbhacquisitioncompany,foracquiringtheremainingsharesintheitalianfirmofticketones.p.a.viatheputoptionagreementalreadyrecognisedintheCtsgroupbalancesheet(eur-20.589million),thecapitalinvestedinthenewlyestablishedfirmofeventimChagastheacquisitioncompanyfortakingovertheticketcornergroup(eur-8.902million)andotherinvestments(eur-1.428million).theseareoffsetbyhighercashinflowfromproceedsfromthesaleoffixedassets(eur+5.389million),mainlyresultingfromthesaleofsharesineventimChag.

Cash flow from financing activities increased year-on-year byeur139.721million toeur+124.582million. incomparison to thepreviousyear,higherexternalborrowing (eur+145.000million)associatedwith theacquisitionofnewparticipationshadapositive impactoncash flowfromfinancingactivities.however,anadditionaleur5.280millionwasdistributedtoshareholderscomparedtotheyearbefore.

asatthebalancesheetdate,thecashandcashequivalentsheldbyCtsagtotaleur38.417million(prioryear:eur86.732million).

51


4. briefassessmentofthebusinessyear

thegroupachievedverysuccessfulresultsintheyearunderreview.thenormalisedkeyfiguresinbothsegmentsimprovedyetagain.withthesesegmentresults,theCtsgroupfulfilleditstargetofimprovingontheprioryear’sperformance.

thegroupandCtsagcontinuedtoimplementtheirgrowthstrategycontinuouslythroughorganicgrowth,targetedacquisitionsandabroaderportfolioofservices.

the2010financialyearwasstronglycharacterisedintheticketingsegmentbythetakeoverandintegrationofthenewlyacquiredcompanies.thisgaverisetopositiverevenueandearningseffects,aswellastemporaryburdensintheformofcostsfortheacquisitionsandforworkforcerestructuring.theanticipatedsynergiesgeneratedbytheacquisitionswerepartlyrealisedinthereportingyearandwill fullymaterialiseasintegrationproceeds.duetothevolumeinvolvedandthehistoricallylowlevelof interestrates,theacquisitionswerepredominantlyfinancedwithexternal loans.therevenueandearningseffectsresultingfromtheacquisitionswereabletoover-compensatefortheshortfallproducedbyterminationofthepartnershipwithlivenationinmid-2010.

thispositivetrendintheoperativeticketingandliveentertainmentbusinesswasagainspurredbythegrowthininternetbusiness,combinedwithsuccessfuleventsbypopandrockstarsofnationalandinternationalfame.

5. appropriationofearningsbyCtsag

inthe2009financialyear,Ctsaggeneratednetincomefortheyear(accordingtohgb)ofeur27.874million.theannualshareholders’meetingon14may2010passedaresolutiontodistributeadividendofeur19.918million(eur0.83pereligibleshare)toshareholders.paymentofthisdividendwaseffectedon15may2010,andtheremainingbalancesheetprofitofeur43.289mil-lionwascarriedforwardtothenewaccount.

in the2010 financial year,Ctsaggeneratedeur26.170million in net income for the year(accordingtohgb).themanagementboardandsupervisoryboardproposetotheshareholders’meetingthatadividendofeur20.878million(eur0.87pereligibleshare)bedistributedandthattheremainingeur5.292millionbecarriedforwardtothenewaccount.

6. dependenCiesreportforCtsag

according to§17 (1)aktg,adependent relationshipexistsat theclosingdatewith themajor-ityshareholder,mrklaus-peterschulenberg(thecontrollingcompany),andwithcompanieswithwhichheisassociated.inaccordancewith§312aktg,areportshallbesubmittedwhichshallalsobepresentedforreviewtothesupervisoryboardandtheauditor.

thereportpursuantto§312aktgfinisheswiththefollowingstatementbythemanagementboard:

‘Judgingfromthecircumstancesknowntothemanagementboardatthetimelegaltransactionsrequiringdisclosurewereconducted,thecompanyreceivedadequateconsiderationineachcase.nomeasuresor legal transactionswith thirdparties requiringdisclosurewereeithereffectedor

52


waivedinthebusinessatthebehestoforintheinterestofthecontrollingcompanyoranaffiliatedcompanywithinthemeaningof§312aktg.’

7. eventsafterthebalanCesheetdate

therearenosignificanteventsrequiringdisclosure.

8. riskreport8.1 riskpoliCyandriskmanagementsystem

thegroup’sriskpolicyisgearedtowardssystematicandcontinuousgrowthinshareholdervalue.itisthereforeamajorcomponentofbusinesspolicy.thereputationofCtsagandthegroup,aswellastheindividualbrandsareofgreatimportanceforthegroup.

reasonable,transparentandmanageablerisksareacceptedifthesearerelatedtotheexpansionandexploitationofthegroup’scorecompetencies.theassociatedrewardsmustentailanappropri-ateincreaseinshareholdervalue.

themanagementboardisbroadlyguidedbythefollowingprinciplesofriskpolicy:

a)achievingbusinesssuccessinvariablyinvolvesrisk,

b)noactionordecisionmayinvolvearisktothecompanyasagoingconcern,

c)risksinrespectofearningsmustbeassociatedwithcorrespondingreturns,

d)risks,ifeconomicallyacceptable,mustbehedgedaccordinglyand

e)residualrisksmustbecontrolledbymeansoftheriskmanagementsystem.

inordertoidentify,assess,manageanddocumentrisksatanearlystage,thegroupoperatesasystemicandappropriateriskmanagementsystemwhichistightlyintegratedwithbusinesswork-flows.

Quarterlyriskreportsandaninternalreportingsystemensurethattopmanagementispromptlyinformedabout potential risks affecting future development. in the secondhalf of the reportingyear, internal risk reportingwasextended to include the various levels ofmanagement andallsubsidiaries.riskmanagementinstruments,suchasareportingsystemwithconsolidatedbudgetcalculations,monthly financialstatementsandregularreviewmeetings,arealsousedto identifyandanalysethevariousrisks,andtoinformtopmanagementaboutthecourseofbusinessintheindividualentities.theriskmanagementprocessissupportedsystemicallybydedicatedsoftware–the‘riskCompass’.

thus,theriskmanagementsystemoperatedbytheCtsgroupnotonlyservesthepurposeofdetectingexistentialrisksatanearlystage,asrequiredbythegermanlawgoverningenterprisecontroland transparency (kontrag),butalsodetectsany identified riskswhichmightmaterially

53


impair theearningsperformanceof thegroup. inpreparing theannual financialstatements,suf-ficientprovisionsweremadetocoverforalldiscerniblerisksintheongoingbusiness,totheextentthattheconditionsfortakingaccountofsuchrisksintheconsolidatedfinancialstatementshavebeenmet.

riskistransferredtoinsurersbytakingout insurancepolicieswithappropriateamountsofcov-erage.thesepoliciesmainly cover property damageand third-party liability claims.some spe-cificoperationalrisksarealsocoveredbyinsurancepolicies.inaddition,corporatemanagementreceivesextensiveadvice fromboth internalandexternalexpertswhen importantdecisionsarebeingtaken.

theauditorevaluatestheefficiencyofoursystemforearlydetectionofrisksandreportsonhisfindings to themanagementboardand thesupervisoryboardafter completinghis audit of theannualfinancialstatements.thesefindingsarethenusedtofurtherimprovetheearlydetectionandmanagementofrisks.

8.2 riskCategories

theCtsgroupclassifiesrisksintosevencategories:

1.strategicrisks

2.marketrisks

3.performancerisks

4.financialrisks

5.project-relatedrisks

6.political/legalrisks

7.Compliancerisks

ofall the identifiedrisksfacingthegroup,thegeneralandspecificrisksthat, fromtoday’sper-spective,mayhaveasignificantadverseimpactonthefinancialposition,cashflowandearningsperformancearebrieflydescribedbelow.

54


8.2.1 strategiCrisks

risksrelatingtofuturemacroeconomictrends

fortheyear2011,thegermanCouncilofeconomicadvisersexpectsanupwardtrendforger-manyandtheeurozone(gdpgrowthof+2.2%and1.3%,respectively).

aspastbusiness trendshaveshown, theeventsmarket is relatively independentofeconomicupswingsanddownswings.

industry,marketandCompetition

thegroupcurrentlycommandsaleadingmarketpositioninticketsales.itisnotcertainthatthismarketpositioncanbemaintained.inprovidingtheirservices,thegroupcompaniescompetewithregionalandsupraregionalprovidersbothingermanyandabroad,aswellaswithdirectticketsalesbyeventpromoters.however,effortsarebeingmadetoreinforcethecompany’spositionasmarketleaderbyexpandingthedistributionnetworkandimprovingtherangeofservices,forexamplebyprovidinganexclusivepre-salesservice,onlinereservationofspecificseats,ticketsalesbymobileshopandtheiphoneapp,bycross-sellingandupselling,promotions,vippackagedeals,aticketresaleplatform,specialbusinessoffers,print-at-homesolutionsandthemobileaccesscontrolsys-tem,‘eventim.accessmobile’.

risksalsoensuefromintensifiedglobalisationand/ormonopolisationontheentertainmentmarketandtheticketingmarket.

8.2.2marketrisks

produCts,serviCesandinnovation

furtherdevelopmentoftheCtsticketingsoftware(‘globalticketingsystem’andin-houseprod-ucts)occursinacontextofveryrapidchangesintheinformationtechnologyfield,involvingacon-stantflowofnewindustrystandards,newproductsandnewservices.thereisnocertaintythattheCtsgroupwillbeabletolaunchnewtechnologiesinatimelymannerandwithoutimpairingthespeedandresponsivenessofthesystem.

thegroup’sbusinessoperationsandtheshareholdervalueof itsassets in theticketingsectordependsignificantlyonpromotersselling theiradmission ticketsvia theCtssalesnetworkandprovidingacertainproportionoftheavailabletickets.thegroupbelievesthateventpromoterswillcontinuetousetheseservicesinfuture,onaccountofthediversifiedstructureofproductsandtheirdistribution.thisriskisminimisedbyacquiringinterestsinvariouswell-knownconcertpromotersat regional and supraregional level, and inothermarketsbyentering into long-termcontractualrelationships.

55


thegroup’sbusinessoperationsandtheshareholdervalueofitsassetsintheliveentertainmentindustryaredependenttoasignificantdegreeonpromoterscontinuingtoofferartistsofnationalandinternationalrenown,thusensuringhighattendanceratesatevents.

theCtsgroupwillrespondtoanycompetitiveandprice-relatedpressuresarisingbynewindus-try-specificorcustomer-specificservicesandsalesinitiatives.

8.2.3 performanCerisks

stabilityandreliabilityoftheitinfrastruCturebeingused

theavailabilityandreliabilityofthesoftwareandhardwareusedingermanyandothercountriesisakeyprerequisite forbusinesssuccess, in thatanymalfunctioningor failuresmaycausesus-taineddamagetothegroup’sinternalandexternalprocessesortotheservicesitperformsforitscustomers.

theserisksarecounteredwithmanymeasuresthataredefinedinasecuritypolicyadoptedbythemanagementboard.

purChasing

beinganit-basedserviceprovider,operatorandsupplierofticketingsystemsandapromoterofliveevents,theCtsgroupcooperateswithverydifferentsuppliers.potentialrisksinthisareaarecounteredbyestablishingqualitystandardsinthesupplyandprocurementprocess,andbyproce-duresfortenderingandprojectcosting.

personnelrisks

thebusinesssuccessesachieved todateareattributable in largemeasure to theactivityandspecialcommitmentofcertainkeypeoplewith important leadershiproles.businesssuccesswillcontinuetodependonthesemanagersremainingintheemployofthegroup,andonwhetherthegroupcancontinuetorecruitnew,highlyskilledpersonnelingermanyandabroad,aswellasoftheabilitytotiekeyperformersofnewlyacquiredsubsidiariestothegrouponalong-termbasis.themanagementdevelopmentprogrammeprovidesdedicatedsupport for,andadvancementofmanagementpotential,aswellasincentivesystems.

56


8.2.4 finanCialrisks

Cashflowrisks

Cashflowrisksarise if thepaymentobligationsof thegroupcannotbecoveredwithavailablecashorcreditlines.

Cashflowisplannedandmanagedtoensurepermanentsolvencyandfinancialflexibility.moniesgeneratedbyadvanceticketsalesaredepositedinseparateserviceaccountsuntilaccountingfortherespectiveeventhasbeencompleted.standardcreditagreementswithvariousbanksareinplace.theextensionriskisminimisedbyvaryingcreditterms.inthereportingyear,acquisitionsofnewsubsidiarieswerepredominantlyfinancedwithexternalloanstakenoutathistoricallylowlevelsofinterest.thegrouphadsufficientcashreservesasatthebalancesheetdateof31december2010.

asat31december2010,thegrouphasbankliabilitiesofeur188.582million(prioryear:eur5.262million).oftheexternalloans,eur141.707millionaresubjecttocompliancewithstandardfinancingcovenants forcompanieswithgoodcreditworthinessratings.there isnocertainty thatthecovenantswillbehonouredinthefuture.however,basedoncurrentbudgetplanning,theCtsgroupassumesthatthecovenantswillalsobehonouredintheyearsahead.

defaultrisks

Creditrisksexistwhenthereisariskofdebtorsbeingunabletosettletheirdebts.themaximumcreditriskisequalintheorytothevalueofallreceivables,minuspayablesowedtothesamedebtorifset-offispossible.intheannualfinancialstatementsofCtsagandthegroup,allowancesfordoubtfulaccountsweremadetooffsetidentifiedcreditrisks.theseareformedonthebasisofhis-toricaldefaultratesandfutureexpectationsforrecoveryofthereceivables.individualimpairmentsaremadeassoonasthereisanindicationthattherespectivereceivableisirrecoverableinwholeorinpart.theseindicationsarealsobasedonintensivecontactwiththerespectivedebtorsinthecontextofreceivablesmanagement.

thearenosignificantconcentrationsofcreditrisks.

forreconciliationoftheimpairmentaccountsandtheagestructureofreceivables,referenceismadetotheadditionaldisclosuresonfinancialinstruments(ifrs7)initem4ofthenotestotheconsolidatedfinancialstatements.

inthe2010businessyear,securitiesamountingtoeur11.713million(prioryear:eur11.902million)wereprovidedforgroupcompanies,mainlytohedgetherisksinticketpre-salesbyvariousboxoffices(eur9.097million,prioryear:eur9.112million).

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foreigneXChangerisks

the foreignexchange risks towhich thegroup is exposedensue from investments, financingactivitiesandoperatingactivitiesinforeigncurrencies.withinthegroup,somecontractswithartistsaswellaslicensingagreementsaretransactedinforeigncurrencies.

foreignexchangeriskswhichdonotaffectthecashflowofthegroup(i.e.theriskswhichresultfromtranslatingtheassetsandliabilitiesofforeignentitiesintothegroupreportingcurrency)remainunsecured,asabasicprinciple.

Currencyrisksthatmayaffect thecashflowof thegrouparereviewedonaregularbasisandhedgedwherenecessary.

acurrencyriskmayalsoarisewhenintercompanyreceivablesorliabilitiesexistinacurrencyotherthanthefunctionalcurrencyoftheconsolidatedfinancialstatements.

in order to disclose financial risk exposure, theCtsgroup produces sensitivity analyses inaccordancewithifrs7,showingtheeffectsthathypotheticalappreciationanddevaluationoftheeuroinrelationtoothercurrencieswillhaveonnetincomeaftertaxandonequity,whererelevant.theperiodiceffectsaredeterminedbyrelatingthehypotheticalchangesinforeignexchangeratestothefinancialinstrumentsinplaceattheclosingdate.itisassumedthatthevolumeofsuchinstru-mentsattheclosingdateisrepresentativefortheyearasawhole.foreignexchangeriskswithinthemeaningofifrs7ensuewhenfinancialinstrumentsaredenominatedinacurrencyotherthanthefunctionalcurrencyandareofamonetarynature;currencytranslationdifferencesrelatingtothetranslationoffinancialstatementsintothefunctionalcurrencyofthegroupareignoredinthisregard.

iftheeurohadappreciated(ordepreciated)invalueby10%againstallothercurrenciesasat31december2010,theconsolidatednetincomeaftertaxwouldhavebeeneur486thousandlower(orhigher,respectively)(prioryear:eur189higher(lower)).thehypotheticaleffectonnetincomeaftertax,ateur-486thousand,resultsmainlyfromthecurrencysensitivitieseur/Chf(eur-496thousand).

interestrisks

fixedinterestrateagreementsaremostlyinplaceforlong-termloans.short-termcreditlinesarenotusedcontinuouslythroughouttheyear,withtheresultthatpotentialinterestrateincreasesdonotposeasignificantrisktothegroup.financialderivativesforhedginginterestratesarethereforenotused.

both variable-interest loansand limited fixed-interest agreements are regularly examinedwithregardtointerestratechanges,andhedgedwherenecessary.

Changesinthemarketinterestratesoforiginalfinancialinstrumentswithfixedinterestratesaffectearningsonlywhenthesearerecognisedat fairvalue.accordingly,all financial instrumentswithfixedinterestratesandrecognisedatcurrentpurchasecostsarenotexposedtoanyinterestriskswithinthemeaningofifrs7.

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ifthelevelofmarketinterestrateshadbeen100basepointshigher(lower)asat31december2010,consolidatednetincomeaftertaxwouldhavebeeneur94thousandlower(higher)(prioryear:eur15thousand).thehypotheticaleur94thousandeffectonconsolidatedincomeresultsfromthepotentialeffectsoforiginalcashandcashequivalentsandfinancialdebtsofeur30.326millionthataresubjecttovariableinterestrates.

otherpriCerisks

thesecuritiesheldbytheCtsgrouparesubjecttomarketpricerisks.inaccordancewithifrs7,thesemarketpricerisksarepresentedintheformofsensitivityanalysesbycalculatingtheeffectsthathypotheticalchangesinmarketpriceswillhaveontherecognitionofavailable-forsalefinancialassetsstatedunderfinancialassetsorotherfinancialassets.

ifmarketpricesasat31december2010hadbeenhigher(lower)byonestandarddeviationfromthehistoricalrelativechangesinvalueoverthefinancialyear,shareholders’equitywouldhavebeeneur7thousandhigher(lower).

taXes

differentopinionsonfiscalmattersmayleadtosubsequenttaxdemandsbeingimposedthathaveadverseimpactsonthefinancialsituation.fiscalauditsarecurrentlybeingconductedfortheyears2005to2009insomesubsidiariesintheliveentertainmentsegment.thefiscalauditofthegroupinrespectoftheyears2000to2004hasbeencompleted.

litigationandClaimsfordamages

pendinglitigationanddamagesclaimsarereportedunderitem13inthenotestotheconsolidatedfinancialstatements.

Capitalmanagement

theaimofcapitalmanagement in theCtsgroup is toensure theefficientcontrolof financialresourceswithinthebusinessunitsinordertohavethemaximumpossibleimpactonprofitabilityandshareholdervalue.asanintegralcomponentoffinancepolicywithintheCtsgroup,thecapitalmanagementsystemcontrolsthebalancesheetstructure,appropriateequitylevels,thefinancingofinvestmentsandthecreationordismantlingofdebts.therespectivecommitteeswithinthecapitalmanagementsystemalsodecideontheappropriationofthebalancesheetprofitandthedividendpolicyofCtsag.

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8.2.5 proJeCt-relatedrisks

risksmayariseinconjunctionwithlargerprojects,inparticular.theserisksareprimarilyqualityrisks,meaningtheriskthatthegoalsofprojectsarenotmetinfull,buttheymayalsotaketheformofcostrisksandrisksrelatingtodeadlines.examplesincludeitprojectsinthecontextofinternationalexpansion,ornewtypesofevent.project-relatedrisksareidentifiedandmanagedwithanappropri-atesystemofprojectmanagement.

8.2.6 politiCal/legalrisks

political/legalrisksmayarisewhenconditionsarestipulatedormodifiedbygovernmentactivities,inparticularbylegislation.examplesaredevelopmentsincommercialandtaxlaw,marketregula-tionmeasures,orrisksderivingfromtheinfluenceofconsumerprotectionorganisations.

8.2.7 ComplianCerisks

Compliancerisksmayarisewhenapplicablelaws,regulationsandindustrystandardsarenotcom-pliedwith.theavoidanceofsuchrisksissupportedbyinternalguidelinesandcontrolmechanisms.

8.3 noriskstotheContinuedeXistenCeofCtsagandthegroupasagoingConCern

anoverviewofrisksshowsthatthegroupismainlyexposedtomarketandperformancerisks.themanagementboardcurrentlyassumesthattherisksarelimitedandtransparentonthewholeandthattheydonotjeopardiseCtsagandthegroupasagoingconcern.therearenoidentifiablerisksatpresentthatmightjeopardisethecontinuedexistenceasgoingconcerns.

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9. managementboardreportpursuanttoseCtions289(4)and315(4)hgb

the registered capital ofCtsag iseur24,000,000, divided into 24,000,000 no-par bearershares.eachshareentitlesthebearertoonevote.

themanagementboardoftheCompanyisnotawareofanyrestrictionsonvotingrightsoronthetransferofshares.

mrklaus-peterschulenberg,bremen,holds50.067%ofthevotingrights.theCompanyhasnoknowledgeofanyothershareholdings,directorindirect,thatexceed10%ofthevotingrights.

shareswithspecialcontrollingrights(‘goldenshares’)donotexist.

thereareno special procedures formonitoring voting rights in theevent that employeesholdsharesintheCompany’scapital.

appointmentanddismissalofmanagementboardmembersisgovernedby§84and§85aktgandby§5iii3oftheCompany’sarticlesofincorporation,accordingtowhichthemembersofthemanagementboardareappointed(anddismissed)bythesupervisoryboardforamaximumoffiveyears.re-appointmentsarepermissible.accordingto§5iofthearticles,themanagementboardcomprisestwoormorepersons;thenumberofmembersisdeterminedbythesupervisoryboard,whichmayalsonominateamemberofthemanagementboardasitsChairpersonpursuantto§84aktg.

accordingto§179(1)aktg,thearticlesofincorporationmaybeamendedbyashareholderreso-lution,whichrequiresamajorityequaltoatleastthree-quartersoftheregisteredcapitalpresentatvoting(§179(2)aktg).§8(8)oftheCtsagarticlesofincorporationavailoftheoptionprovidedforin§179(2)aktg,anddefinesthatresolutionsmaybeadoptedwithasimplemajorityofvotescastand,ifamajorityofsharecapitalisrequired,withasimplemajorityofthesharecapital.shareholderresolutionsforwhichaqualifiedmajorityofvotesorsharecapitalisrequiredbylaw,areadoptedattheshareholders’meetingbyatwo-thirdsmajorityunlessotherwisestipulatedbymandatorystatu-toryprovisions.

themanagementboard hasbeenauthorised to increase the registered capital by up toeur12,000,000by13may2014,contingentonsupervisoryboardapproval,byissuingupto12,000,000newbearersharesagainstcashcontributionsorcontributionsinkind(approvedcapital,2009).themanagementboardhasalsobeenauthorisedtoincreasethesharecapitalbyuptoeur360,000,contingentonsupervisoryboardapproval,byissuingupto360,000bearersharestoholdersexer-cisingoptionsissuedunderthestockoptionplanonthebasisoftheauthorisationgrantedon21January2000(‘contingentcapital2001/1’).

themanagementboardhasalsobeenauthorisedtoissuestockoptionsandconvertiblebondstoa totalvalueofup toeur275millionandwithamaximum termof20years,conditionalonsupervisoryboardapproval,by14may2013,togranttheholdersoptionandconversionrightstoupto11,000,000newno-parbearersharesinthecompany,equaltosharecapitalofuptoeur11,000,000,andtoexcludeshareholders,withinlegallypermittedlimits,fromsubscribingtothecon-vertiblebondsundercertainconditions.inviewofthepossibleissueofsharestoholdersofoptionandconversionrightsonthebasisofthisauthorisation,anadditionaleur11,000,000incontingentcapitalhasbeencreated(‘contingentcapital2008’).

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thecompanyisauthorisedtopurchase,by11may2015andastreasurystock,upto10%ofthe24,000,000no-parvaluebearersharesformingtheregisteredsharecapitalofthecompany,atthepriceandsubjecttotheconditionsdefinedintheauthorisationresolutiondated12may2010,andtousethesetreasurysharesforcertainpurposes,partiallyalsowithexclusionofsubscriptionrightsforshareholders.

nodisclosuresneedtobemaderegardingmaterialagreementsconcludedbytheCompanywhicharecontingentonachangeofcontrol followinga takeoverbid,or regarding theeffectsensuingtherefrom.

therearenocompensationagreementswithmembersofthemanagementboardoremployeesthatshalltakeeffectintheeventofatakeoverbid.

10. CorporategovernanCedeClaration

theexecutivebodiesofCtsagareguidedintheiractionsbytheprinciplesofresponsibleandgoodcorporategovernance.themanagementboardsubmitsareportoncorporategovernanceinadeclarationofcompliance,inaccordancewith§289a(1)hgb.thecurrentandallpreviousdec-larationsofcompliancearepermanentlyavailableontheinternetatthewww.eventim.dewebsite(http://www.eventim.de/tickets.html?affiliate=eve&fun=tdoc&doc=eventim/default/info/en/investor/investorCorporategovernance/managementdeclaration).

11. reportonopportunitiesandeXpeCtations11.1 eConomiCmaCroenvironment

intheopinionofthegermanCouncilofeconomicadvisers,theglobaleconomywillcontinuetorecoverin2011,althoughtheintensityofthatrecoverymayvarybetweendifferentnationalecono-mies.inindustrialisednations,therecoverywillproceedatamoderatepace,whereasemergingnewly-industrialisingcountrieswillbenefitadditionallyfromgrowthindomesticdemand.

thegeneraleconomic recoveryhasalsobeenassistedbyvariousmonetarystimulibycentralbanks. it remains to be seen, therefore,whether and towhat extent themonetary instrumentsappliedbycentralbanksarefuellinginflationarytendencies.insuchacase,asubstantialriseinpricesonrelevantcommoditymarketscouldbrakeanyfurtherrecovery in thebroadereconomy.furthermore,thedebtcrisisandthecrisisofconfidenceinsomeeurozonecountriesisbynomeansover.anyfurtherescalation,orrecoursetotheeuropeanfinancialstabilitymechanismbyadebtorcountrywouldalsohaveimpactsontheeconomicclimateingermany.

thegermanCouncilofeconomicadvisersexpectsonlymoderategrowthintheorderof2.2%forgermany in2011(2010:3.2%).however, thisputseurope’sbiggesteconomywellaheadof the1.3%growthrateexpectedfortheeurozonein2011.

privateconsumption, supportedby furtherencouraging trendson theemploymentmarketandexpectationsoflessthan3millionunemployed,isonereasonforthisfurthergrowthofthegermaneconomy.

theeuropeanCommissionexpectsthepaceofgrowthintheeurozonetoslowsomewhatin2011.themainreasonscitedaretheendofthefiscalandmonetarymeasuresimplementedoverthepast

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twoyears.otherfactorscurbingdemandintheeurozonearethehighlevelofprivatehouseholddebtinsomeeucountries,andausteritymeasurestoreducepublicspending.for2011,theeuro-peanCommissionestimatesthattheunemploymentratewillremainunchangedatjustunder10%.

11.2 developmentofearningsperformanCe

theCtsgroupcontinuestoshowrobustgrowth.thesuccessoftheCtsgroupwillcontinuetobeinfluencedinlargemeasurebyitsbusinessmodel,namelythecombinationofticketingandliveentertainmentsegments.theprerequisite forestablishinga ticketingnetwork isasufficientvolumeofevents.atthesametime,sourcingeventsrequiresafunctioningandextensivedistribu-tionnetwork.

potentialmarkettrendsmayleadtomodificationinbusinessmodelsorinthevaluechain,duetointensifiedglobalisationandmonopolisationinticketingandliveentertainment.thegroupmonitorsthemarketintentlyforpossiblechanges,inordertorespondflexiblyshouldtheneedarise.

tiCketing

in theticketing segment, theCtsgroupwill continue in the yearsahead topursue its basicstrategicdirectionas leaderof theeuropean ticketingmarket. inaddition toorganicgrowthandintegrationofthecompaniesnewlyacquiredinthereportingyear,effortswillalsoremainfocusedoninternationalexpansion.

integrationofthecompaniesnewlyacquiredinthereportingyearisrunningaccordingtoplan,andinitialsynergieshavealreadybeenrealised.inthemediumterm,itisexpectedthatadditionalandsubstantialsynergiescanbetapped,especiallythroughscaleeffects.

expanding online ticketing operations remains a highly prioritised task for theCtsgroup: inexistingand innewmarkets, it isplanned toachieve further increases in total ticket volumebygrowingmuchmorestronglyinthefieldofinternetticketing.increasingticketingvolumessoldviatheinternetleadtoimprovedprofitmarginsonthebasisofexistingcoststructures;intheticketingsegment,theaveragevalue-addedperonlineticketissixtimeshighercomparedtoticketssoldviaofflinesaleschannels.

themain focusof the growth strategyand the basis for profitable business development arecontinuousimprovementsintheticketingsoftwareproducts.technologicalleadershipincludes,forexample,anexclusivepre-salesservice,onlinereservationofspecificseats,ticketsalesbymobileshopand the iphoneapp, cross-selling andupselling, promotions,vippackagedeals, a ticketresaleplatform,specialbusinessoffers,print-at-homesolutionsandthemobileaccesscontrolsys-tem,‘eventim.accessmobile’.socialmediapartnershipsroundofftherangeofservicesprovidedontheinternet.

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CtsaghasreceivedarequestforinformationfromthegermanfederalCartelofficeregardingthe100%takeoverofseeticketsgermanygmbh,whichwaseffectedinearlyJuly2010.initsrequest,theCartelofficeinformedthecompanythatitisplanningtoconductaretrospectivereviewtodeterminewhethertherewasanobligationundermergercontrolregulationstonotifytheofficeoftheacquisition.Ctsagcontinuestoassumethatthetransactiondoesnotcomeundersections35ff.ofthelawagainstrestraintsoncompetition(gwb).Ctsagpromptlyprovidedalltheinformationrequiredandrequested.

on5april2010,Ctsagfiledforarbitrationagainstlivenationinc.andlivenationworldwideinc. at the internationalChamber ofCommerce (iCC), inwhichlivenation is sued for variousbreachesofcontract,withaplea that the latter tobeorderedto fulfil thepartnershipagreementconcludedindecember2007andtopaydamages.inJune2010,livenationgavenoticethatitwasterminatingtheagreementonthegroundsofallegedbreachesbyCtsag.Ctsagrejectedthenoticeofterminationbylivenationandannouncedadditionalclaimstodamagesintheorderofmillions.untilmid-2010,thepartnershipinitiatedin2009withlivenationwasstillhavingapositiveeffectonrevenueandearningsintheticketingsegment.adecisiononthearbitrationrequestisexpectedbytheendof2011.

liveentertainment

intheliveentertainmentsegment,theCtsgroupisexcellentlypositionedwithitssubsidiariesandinvestments.intheweeksandmonthsahead,theconcertpromoterswithintheCtsgroupwillthrillaudienceswithartistslikeherbertgrönemeyer,metallica,neildiamond,linkinparkandsting.

strategicrealignmentofthissegmentforfurtherimprovementinearningsandmarginsisprimarilyfocusedonimprovingthenetprofitmargin.sharesinconsolidatedcompanieswereincreasedorreducedtothisend.duetothedeconsolidationoffkpscorpioanditssubsidiaries,revenuefromthesecompanieswillno longerbe recognised in thegroup insubsequentyears. in future,onlysharesinprofitswillbestatedinthefinancialresultusingtheequitymethod.

successfulbusinessdevelopment isplannedforthissegmentalso,onthebasisofworld-classtours,events,festivalsandnewtypesofevents(suchas‘edutainment’).

11.3 developmentofthefinanCialposition

futureinvestmentswillbemadefromcurrentcashflow.owingtocurrentconditionsonthelendingmarketforcompanieswithgoodcreditworthinessratings,externalborrowingwillalsobeconsideredasameansoffinancingacquisitionsandretainingcashflowinthefuture.

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11.4 overallviewofprospeCtivedevelopment

ifbusinessexpectationsandstrategicplanscometo fruition, furtherbusinessadvancementaswellasfurther improvement inrevenueandearningscanbeexpected in2011and2012.uncer-taintiesonmarketsworldwidemayneverthelesshavenegativeimpactsontheeventsmarketandhenceonthebusinessdevelopmentoftheCtsgroup.

theamountofanydividendwillcontinuetobebasedonearningsandonthestrategicdevelop-mentofthegroup.

forward-lookingstatements

inadditiontohistoricalfinancialdata,thisreportmaycontainforward-lookingstatementsusingtermssuchas‘believe’,‘assume’,‘expect’andthelike.suchstatementsmaydeviate,bytheirverynature,fromactualfutureeventsordevelopments.

bremen,23march2011

Ctseventimaktiengesellschaft

themanagementboard

65

Consolidatedfinancialstatements2010

consolidAted finAnciAl stAteMents 2010

CONSOLIDATED BALANCE ShEET AS AT 31 DECEMBER 2010 (IFRS)

ASSETS 31.12.2010 31.12.2009

[EUR] [EUR]

Current assetsCashandcashequivalents (1) 178,036,473 229,793,885tradereceivables (2) 31,893,172 19,798,749receivablesfromaffiliatedandassociatedcompanies (3) 6,978,834 3,566,038inventories (4) 19,314,956 15,571,215receivablesfromincometax (5) 10,513,476 8,805,184otherassets (6) 41,380,839 47,721,828Total current assets 288,117,750 325,256,899

Non-current assetsproperty,plantandequipment (7) 15,356,589 11,239,833intangibleassets (8) 91,397,408 20,491,706investments (9) 2,035,092 1,020,810investmentsinassociates (10) 1,992,660 343,089loans (11) 533,814 486,188tradereceivables (12) 211,603 1,267,880receivablesfromaffiliatedandassociatedcompanies (13) 0 1,186,397otherassets (14) 201,304 2,303,139goodwill (15) 254,259,379 96,928,983deferredtaxassets (16) 2,363,852 1,359,580Total non-current assets 368,351,701 136,627,605

Total assets 656,469,451 461,884,504

7.

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ShAREhOLDERS’ EQUITy AND LIABILITIES 31.12.2010 31.12.2009

[EUR] [EUR]


(17) 6,567,412 25,217,733

tradepayables (18) 38,743,409 35,889,823payablestoaffiliatedandassociatedcompanies (19) 2,919,716 1,230,496advancepaymentsreceived (20) 64,550,219 101,766,084otherprovisions (21) 4,384,600 1,331,234taxprovisions (22) 8,359,099 10,077,558otherliabilities (23) 150,379,083 125,038,530Total current liabilities 275,903,538 300,551,458

Non-current liabilitiesmedium-andlong-termfinancialliabilities (24) 199,790,947 7,961,533otherliabilities (25) 320,337 12,211pensionprovisions (26) 4,417,210 2,715,559deferredtaxliabilities (27) 17,929,786 780,013Total non-current liabilities 222,458,280 11,469,316

Shareholders’ equity (28)sharecapital 24,000,000 24,000,000Capitalreserve 23,310,940 23,310,940retainedearnings 98,035,415 97,868,776treasurystock -52,070 -52,070non-controllinginterest 11,431,304 4,945,973totalcomprehensiveincome 21,842 52,078Currencydifferences 1,360,202 -261,967Total shareholders’ equity 158,107,633 149,863,730

Total shareholders’ equity and liabilities 656,469,451 461,884,504

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CONSOLIDATED INCOME STATEMENT FOR ThE PERIOD FROM 1 JANUARy TO 31 DECEMBER 2010 (IFRS)

CONSOLIDATED STATEMENT OF COMPREhENSIVE INCOME FOR ThE PERIOD FROM 1 JANUARy TO 31 DECEMBER 2010 (IFRS)

01.01.2010 - 31.12.2010

01.01.2009 - 31.12.2009

[EUR] [EUR]

revenue (1) 519,576,886 466,697,634Costofsales (2) -372,679,471 -342,260,250Gross profit 146,897,415 124,437,384

sellingexpenses (3) -44,046,855 -34,413,065generaladministrativeexpenses (4) -28,904,000 -19,248,835otheroperatingincome (5) 13,156,480 8,336,827otheroperatingexpenses (6) -16,546,641 -7,832,104Operating profit (EBIT) 70,556,399 71,280,207

income/expensesfromparticipations (7) 33,661 7,800income/expensesfrominvestmentsinassociates (8) -50,878 140,205financialincome (9) 2,472,448 2,016,048financialexpenses (10) -4,159,075 -1,948,697Earnings before tax (EBT) 68,852,555 71,495,563

taxes (11) -19,682,279 -23,306,514Net income before non-controlling interest 49,170,276 48,189,049

non-controllinginterest (12) -7,399,536 -8,245,606Net income after non-controlling interest 41,770,740 39,943,443

earningspershare(ineur);undiluted(=diluted) 1.74 1.66averagenumberofsharesincirculation;undiluted(=diluted) 24,000,000 24,000,000

01.01.2010 - 31.12.2010

01.01.2009 - 31.12.2009

[EUR] [EUR]

netincomebeforenon-controllinginterest 49,170,276 48,189,049exchangedifferencesontranslatingforeignsubsidiaries 1,622,169 -81,363available-for-salefinancialassets -30,236 52,078Other results 1,591,933 -29,285Total comprehensive income 50,762,209 48,159,764Total comprehensive income attributable to

shareholdersofCtsag 43,318,477 39,916,433non-controllinginterest 7,443,732 8,243,331

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CONSOLIDATED STATEMENT OF ChANGES IN ShAREhOLDERS’ EQUITy (IFRS)

Share capital Capital reserveRetained earnings Treasury stock

Non-controlling interest

Other compre-hensive income

Currency differences

Total sharehold-ers’ equity (28)

[EUR] [EUR] [EUR] [EUR] [EUR] [EUR] [EUR] [EUR]

01.01.2009 24,000,000 23,310,940 72,564,006 -52,070 5,794,783 0 -180,604 125,437,055Changeinthescopeofconsolidation 0 0 0 0 -983,746 0 0 -983,746dividendstonon-controllinginterest 0 0 0 0 -8,110,670 0 0 -8,110,670dividendstoshareholdersofCtsag 0 0 -14,638,673 0 0 0 0 -14,638,673totalcomprehensiveincome 0 0 39,943,443 0 8,245,606 52,078 -81,363 48,159,76431.12.2009 24,000,000 23,310,940 97,868,776 -52,070 4,945,973 52,078 -261,967 149,863,730

Changeinthescopeofconsolidation 0 0 -20,265,514 0 6,401,801 0 0 -13,863,713dividendstonon-controllinginterest 0 0 -1,420,392 0 -7,316,006 0 0 -8,736,398dividendstoshareholdersofCtsag 0 0 -19,918,195 0 0 0 0 -19,918,195totalcomprehensiveincome 0 0 41,770,740 0 7,399,536 -30,236 1,622,169 50,762,20931.12.2010 24,000,000 23,310,940 98,035,415 -52,070 11,431,304 21,842 1,360,202 158,107,633

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CONSOLIDATED CASh FLOw STATEMENT FOR ThE PERIOD FROM 1 JANUARy TO 31 DECEMBER 2010 (IFRS)

01.01.2010 -31.12.2010

01.01.2009 31.12.2009

thefollowingcashflowstatementshowstheflowsoffundsfromoperatingactivities,investingactivitiesandfinancingactivitiesofthegroup,andtheresultantchangeincashandcashequivalents:

[EUR] [EUR]

A. Cash flow from operating activitiesnetincomeafternon-controllinginterest 41,770,740 39,943,443non-controllinginterest 7,399,536 8,245,606depreciationandamortisationonfixedassets 17,439,266 9,042,152Changesinpensionprovisions -493,450 468,543deferredtaxexpenses/income -3,308,741 558,636Cash flow 62,807,351 58,258,380othernon-cashexpenses/income -3,657,816 2,818,044bookprofit/lossfromdisposaloffixedassets -70,088 42,190interestincome -2,356,422 -1,995,408interestexpenses 3,287,240 1,600,305incometaxexpenses 22,991,020 22,747,878interestreceived 2,580,370 1,782,142interestpaid -2,513,629 -818,488incometaxpaid -30,040,689 -20,863,793increase(-)/decrease(+)ininventories(especiallypaymentsonaccount) -3,998,797 -2,838,601increase(-)/decrease(+)inreceivablesandotherassets 9,574,443 -31,913,719increase(+)/decrease(-)inprovisions 2,617,217 1,130,577increase(+)/decrease(-)inliabilities -49,703,637 25,102,882Cash flow from operating activities (1) 11,516,563 55,052,389

B. Cash flow from investing activitiespaymentsforinvestmentsinintangibleassets -9,487,121 -4,302,192paymentsforinvestmentsinproperty,plantandequipment -6,175,983 -5,936,198paymentsforinvestmentsinnon-currentfinancialassets -104,425 -16,758proceedsfromsalesofproperty,plantandequipment 366,560 99,577proceedsfromsalesofnon-currentfinancialassets 425,714 1,168,241paymentsforacquisitionofconsolidatedcompanies -126,192,669 -5,983,917netincrease/decreaseincashandcashequivalentsduetochangeinscopeofconsolidation 7,204,594 0Cash flow from investing activities (2) -133,963,330 -14,971,247

C. Cash flow from financing activitiesproceedsfromborrowingfinancingloans 186,731,600 306,510proceedsfromthechangeinnon-controllinginterest 5,418,684 0paymentsfromthechangeinnon-controllinginterest -32,432,585 0paymentsforredemptionoffinancingloans -5,608,835 -823,591paymentsforredemptionoffinancialliabilities -55,693,306 0dividendpaymentstonon-controllinginterest -8,736,398 -8,203,917dividendpaymentstoshareholdersofCtsag -19,918,195 -14,638,673Cash flow from financing activities (3) 69,760,965 -23,359,671

D. Net increase / decrease in cash and cash equivalents -52,685,802 16,721,471netincrease/decreaseincashandcashequivalentsduetochangeinscopeofconsolidation -1,223,474 0netincrease/decreaseincashandcashequivalentsduetocurrencytranslation 2,151,864 0Cashandcashequivalentsatbeginningofperiod 229,793,885 213,072,414

E. Cash and cash equivalents at end of period 178,036,473 229,793,885F. Composition of cash and cash equivalents

Cashandcashequivalents 178,036,473 229,793,885Cash and cash equivalents at end of period 178,036,473 229,793,885

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notestotheConsolidatedfinanCialstatementsforthefinanCialyearfrom1January–31deCember2010(ifrs)

1. prinCiples1.1 struCtureandbusinessoperationsofthegroup

the company is registered asCtseventimag (hereinafter:Ctsag),dingolfingerstrasse6,d-81673munich,germany,intheCommercialregisteratmunichlocalCourtunderno.hrb156963.thecompany’sheadofficeisinbremen,germany.sharesinCtsagaretradedundersecuritiescode547030inthesdaXsegmentofthefrankfurtstockexchange.

theobjectsofthecompanyintheticketingsegmentaretoproduce,sell,broker,distributeandmarketticketsforconcerts,theatre,art,sportsandothereventsingermanyandabroad,particularlyinthefederalrepublicofgermanyandothereuropeancountries,inparticularbyusingelectronicdataprocessingandmoderncommunicationanddatatransmissiontechnologies.furtherobjectsofthecompanyaretoproduce,sell,broker,distributeandmarketmerchandisingarticlesandtravel,andtoengageindirectmarketingactivitiesofallkinds.thecompanycompetesfortheprovisionofitsservicesnotonlywithregionalandsupraregionalprovidersofsimilarservicesingermanyandothercountries,butalsowith regionalcompaniesandwithdirect ticketsellingby the respectivepromoters.theobjectsoftheliveentertainmentsegmentaretoplan,prepareandexecuteevents,inparticularmusiceventsandconcerts,andtomarketmusicproductions.

theannualfinancialstatementsofCtsagandtheconsolidatedfinancialstatementsofCtsag,bearinganunqualifiedauditopinionofpricewaterhouseCoopersaktiengesellschaftwirtschaftsprü-fungsgesellschaft,osnabrück,arepublishedintheelectronicfederalgazette(bundesanzeiger).

theseconsolidatedfinancialstatementsandthesummarisedmanagementreportwereapprovedbythemanagementboardofCtsagon23march2011,forpresentationtothesupervisoryboard.

1.2 aCCountingprinCiples

theconsolidatedfinancialstatementswerepreparedinaccordancewiththeinternationalfinan-cialreportingstandards (ifrs), in the formapplicablewithin theeuropeanunion (eu),and inaccordancewiththesupplementaryaccountingregulationspursuantto§315a(1)ofthegermanCommercialCode(hgb).allifrssissuedbytheinternationalaccountingstandardsboard(iasb)andapplicablewhentheseconsolidatedfinancialstatementswerepreparedhavebeenadoptedbytheeuropeanCommissionforuseintheeu.theconsolidatedfinancialstatementswerepreparedusingthehistoricalcostconvention,limitedbytherecognitionoffinancialassetscarriedatfairvaluebutnotthroughprofitorloss.

the layoutof thebalancesheetconforms to ias1.adistinction ismade in thebalancesheetbetweencurrentandnon-currentassetsandliabilities,someofwhicharedisclosedindetailinthenotes,accordingtotimetorecoveryorsettlement.thelayoutoftheincomestatementisbasedonthe‘costofsales’method.expensesincurredaresetinrelationtotherevenuegeneratedandareclassifiedaccordingtotheirfunctionascostsofsales,sellingexpensesandgeneraladministrativeexpenses.

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theconsolidatedfinancialstatementsaredenominatedineuro.allamountsintheannualreportareroundedtothenearestthousandeuro.thismayleadtominordeviationsonaddition.

1.3 newandamendedstandardswithmandatoryappliCationin2010

thefollowingnewandamendedstandardsand interpretationwereapplied for the first timeasfrom1January2010:

•ifrs1(revisednovember2008)‘first-timeadoptionofifrs’

•amendmentstoifrs1‘additionalexemptionsforfirst-timeadopters’

•amendmentstoifrs2andifriC11‘groupCash-settledshare-basedpaymenttransaction’

•ifrs3(revisedJanuary2008)‘businessCombinations’

•ias27(revisedJanuary2008)‘Consolidatedandseparatefinancialstatements’

•amendment to ias39 (July 2008) ‘financial instruments:recognitionandmeasurement:eligiblehedgeditems’

•ifriC12‘serviceConcessionarrangements’

•ifriC15‘agreementsfortheConstructionofrealestate’

•ifriC16‘hedgesofanetinvestmentinaforeignoperation’

•ifriC17‘distributionsofnon-Cashassetstoowners’

•ifriC18‘transfersofassetsfromCustomers’

•improvementstoifrsapril2009–minoramendmentstoanumberofifrss(ifrs2,ifrs5,ifrs8,ias1,ias7,ias17,ias18,ias36,ias38,ias39,ifriC9,ifriC16)andcon-sequentialamendmentstootherstandards

allaccountingstandardsmandatoryfromthe2010financialyearonwardswereapplied.thesemainlyinvolveifrs3‘businessCombinations’andias27‘Consolidatedandseparatefinancialstatements’.theamendmentstoifrs3andias27leadtochangesinthepresentationofbusi-nesscombinations.Changesintheinterestheldinsubsidiariesthatarealreadyfullyconsolidated,andwhichdonotleadtoalossofcontrol,arenolongertobereportedingoodwill,butinsharehold-ers’equity.theremaininginterestistoberecognisedatfairvalueandanyprofitorlossarisingfromtheremeasurementmustbereportedintheincomestatement(cf.sub-section1.6.2,‘disposalofinterests in theliveentertainmentsegment’).any interestalready recognisedbefore transferofcontrolmustthereforebemeasuredatfairvaluethroughprofitorloss.

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1.4 newaCCountingstandardsissuedbutnotyetapplied

the iasb and the international financial reporting interpretations Committee (ifriC) haveadoptedadditionalstandardsandinterpretationsthatarenotyetmandatoryforthe2010financialyearandwhichhavenotbeenapplied to theconsolidatedannual financial statementsasat31december2010.

adoptedbytheeu:

•amendmentstoifrs1‘limitedexemptionfromComparativeifrs7disclosuresforfirst-timeadopters’(applicableonorafter1July2010)

•ias24(revisednovember2009)‘relatedpartydisclosures’(applicableonorafter1January2011)

•amendmenttoias32‘Classificationofrightsissues’(applicableonorafter1february2010)

•amendmentstoifriC14‘prepaymentsofaminimumfundingrequirement’(applicableonorafter1January2011)

•ifriC19‘extinguishingfinancialliabilitieswithequityinstruments’(applicableonorafter1July2010)

•improvementstoifrsmay2010–minoramendmentstoanumberofifrss(ifrs1,ifrs3,ifrs7,ias1,ias27,ias34,ifriC13)andconsequentialamendmentstootherstandards(applicableonorafter1January2011and1July2010respectively)

notyetadoptedbytheeu:

•amendmentstoias12‘deferredtax:recoveryofunderlyingassets’(applicableonorafter1January2012)

•ifrs1‘severehyperinflation’and‘removaloffixeddates’(applicableonorafter1July2011)

•amendmentstoifrs7(october2010)‘financialinstruments:disclosures:transferoffinan-cialassets’(applicableonorafter1July2011)

•ifrs9‘financialinstruments:Classificationandmeasurement’(applicableonorafter1Janu-ary2013)

standardsthatarenotapplicableuntilafter thebalancesheetdatehavenotbeenprematurelyapplied.theeffectsofthestandardsonthefinancialpositionandfinancialperformanceoftheCtsgrouparestillbeingreviewed,althoughnomaterialeffectsontheconsolidatedfinancialstatementsareexpectedinthefuture.

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1.5 disClosuresConCerningConsolidationpoliCies

all relevant subsidiaries are included in the consolidated financial statements.some smallerregionalsubsidiaries,inboththeticketingsegmentandtheliveentertainmentsegment,havenotbeenincludedintheconsolidatedfinancialstatementsbecauseoftheirinsignificanceforestablish-ingafairviewofthegroup’searningsperformanceandfinancialposition.therevenueofcapital-isedinvestmentsnotincludedintheconsolidatedfinancialstatementsduetoinsignificanceislessthan1.5%ofgrouprevenue.

asabasicprinciple,thefinancialstatementsofthecompaniesincludedintheconsolidatedfinan-cialstatementsarepreparedinaccordancewithuniformaccountingpolicies.

thebalancesheetdateoftheconsolidatedcompaniesisidenticaltothatoftheparent.

Capitalconsolidationiseffectedusingtheacquisitionmethodbyoffsettingthecarryingamountoftheinvestmentagainsttherevaluedshareholders’equityofthesubsidiaryatthetimeofacquisition(‘purchaseaccounting’).thecostoftheacquisitionisequaltothefairvalueofthetransferredassetsandliabilitiesassumedatthetimeoftransaction.assets,debtsandcontingentliabilitieswhichcanbeidentifiedinthecontextofacorporatemergerarerecognisedattheirrespectivefairvalueswhenfirstincludedinconsolidation.anyamountbywhichthecostexceedsthegroup’sshareinthefairvalueofnetassetsisrecognisedasgoodwill.iftheacquisitioncostsarelessthanthenetassetsoftheacquiredsubsidiarymeasuredatfairvalue,thedifferenceisrecognisedintheincomestatement.accordingtoifrs3andias36,goodwillmustbereviewedannuallywithregardtocarryingvalueandanyindicationsofimpairment.

Consolidationiscarriedoutasatthetimeofacquisition,whencontrolexists,orwhentheminimumsignificancelevelsforinclusioninconsolidationareexceeded.

investmentsincompaniesoverwhichsignificantinfluencecanbeexercisedaremeasuredbytheequitymethod;asignificantinfluencecanbeexercisediftheshareofvotingrightsisbetween20%and50%(‘associates’).investmentsmeasuredatequityarerecognisedattheproportionateinterestintheinvestee’srevaluedshareholders’equity.Changesintheproportionateshareholders’equitywitheffectsonnet incomeare recognised in the incomestatementasprofitor loss from invest-mentsstatedatequity.ifthegroup’sshareinlossesfromanassociateisequaltoorgreaterthanthegroup’sshareinthatcompany,thegroupdoesnotpostanyfurtherlossesunlessithasenteredintoobligationsinrespectoftheassociate,orhasmadepaymentsfortheassociate.

revenues,interimresults,expensesandincome,aswellasreceivablesandpayablesareelimi-natedbetweenconsolidatedcompanies.

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1.6 businessCombinationsanddisposalofinterestsinsubsidiaries1.6.1 businessCombinationsinthetiCketingsegment1.6.1.1 ChangesinthesCopeofConsolidation

thefollowingcompanieswereincludedintheticketingsegmentduringthereportingperiod:

indecember2010,CtsagestablishedCtseventimisrael,telaviv,withanothershareholder.Ctsagholds70%ofthesharesinsaidcompany.thecompanyhasnotgeneratedanyrevenueorsignificantincomesinceinitialconsolidation.

inacontractdated13september2010,ticketones.p.a.,milan,acquired51%ofthesharesinticketerias.r.l,rome.thepricepaidfortheshareswaseur1million.ticketerias.r.l.mainlyoper-atesinticketingforculturalevents.thechangeofcompanynametot.o.s.C.–ticketonesistemiCulturalis.r.l.wasenteredintheregisterofcompanieson24november2010.sinceinitialconsoli-dationon13september2010,ticketerias.r.l.hasgeneratedeur419thousandinrevenueandanetlossofeur51thousand.asaresultofthisinvestment,cashandcashequivalentsamountingtoeur239thousandwereacquired.

on6July2010,Ctsagacquired100%ofthesharesinseeticketsgermanygmbh,domiciledinhamburg,foreur145million.seeticketsgermanywasasubsidiaryofseeticketsinterna-tionalbvinamsterdam,40%ofwhichbelongstostageentertainmentbvand60%ofwhichisheldbyparcom,aprivate-equitygroup.byacquiringseeticketsgermany,Ctsagsimultaneouslytookoverticketonlinesoftwaregmbh,ticketonlinesales&serviceCentergmbhandticketonlinepolskaspzoo,poland.a12-yearexclusiveticketingcontractwithstageentertainmentgermanywasconcludedsimultaneouslywiththesharepurchaseagreement.sinceinitialconsolidationon6July2010,seeticketsgermanygmbh/ticketonlinegrouphasgeneratedeur21.423millionin revenueandnet incomeofeur2.189million.thenet income includes, interalia,workforcerestructuring expenses (eur -2.430million), amortisation frompurchaseprice allocation (eur-3.810million),anddeferredtaxincome(eur+1.079million).byacquiringthisgroupofcompanies,cashandcashequivalentsamountingtoeur7.777millionwerealsoacquired.

inthereportingperiod,Ctsagacquired100%ofthesharesinticketcornerholdingag,aswisscompany based inrümlang (hereinafter:ticketcornerholding), through the newly-establishedeventimChagsubsidiaryregisteredon28January2010intheZurichcompaniesregister.inaddi-tiontoticketcornerholding,theticketcornergroupalsoincludesitsswisssubsidiary,ticketcornerag,rümlang,thegermansubsidiary,ticketcornergmbh,badhomburg,andtheaustriansubsidi-ary,ticketcornergmbh,vienna.thepurchasepricewasChf65million(aroundeur44million).sinceinitialconsolidationon1march2010,theticketcornergrouphasgeneratedeur18.440mil-lioninrevenueandnetincomeofeur-867thousand.thenetincomeincludes,interalia,workforcerestructuringexpenses (eur -300 thousand), amortisation frompurchasepriceallocation (eur-3.468million),anddeferredtaxincome(eur+1.126million).byacquiringthisgroupofcompanies,cashandcashequivalentsamountingtoeur7.204millionwerealsoacquired.

witheffectfrom1January2010,eventimsp.zo.o,warsaw,wasnewlyincludedinconsolidation.Ctsagholds100%ofthiscompany.

witheffectfrom1January2010,s.C.eventim.ros.r.l.,bucharest,wasnewlyincludedinconsoli-dation.ticketexpressgesellschaftzurherstellungundzumvertriebelektronischereintrittskartenmbh,vienna,holds59%ofthiscompany.

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proformainformation

thefollowingproformainformationpresentsthefinancialdataofCtsgroup,includingitsconsoli-datedsubsidiariesacquiredinthe2010financialyear,asiftheyhadbeenincludedintheconsoli-datedfinancialstatementsfromthebeginningofthe2010financialyear.

todetermineaproformaconsolidatednetincome,amongotherthingstheexternalfinancingforthenewlyacquiredcompaniesaswellastheamortisationfromthepurchasepriceallocationwererecognisedfortheentire2010financialyear.

[EUR’000]

Revenuereported 519,577proforma 540,826

Net incomereported 41,771proforma 39,343

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1.6.1.2 purChasepriCealloCation

provisionalpurchasepriceallocationforseeticketsgermany/ticketonlinegroup

basedontheprovisionalpurchasepriceallocation, thefollowingtableshowsthefairvaluesatthetimeofinitialconsolidationandthecarryingvaluesimmediatelybeforeacquisitionofseeticketgermany/ticketonlinegroup:

Fair value at the time of

initial consolidation

Carrying value immediately

before acquisition

[EUR’000] [EUR’000]

Cashandcashequivalents 7,777 7,777inventories 103 103tradereceivables 2,489 2,489otherassets 4,831 4,831Total current assets 15,200 15,200

property,plantandequipment 2,566 2,566intangibleassets 54,358 13,783tradereceivables 242 242deferredtaxassets 1,540 0Total non-current assets 58,706 16,591

short-termfinancialliabilities 969 969tradepayables 1,743 1,743provisions 5,634 5,634otherliabilities 8,810 8,810Total current liabilities 17,156 17,156

medium-andlong-termfinancialliabilities 11,184 11,184deferredtaxliabilities 16,390 1,754Total non-current liabilities 27,574 12,938

Total net assets 29,176 1,697

asat31december2010,thepurchasepriceallocationisstillprovisionalbecauseinvestigationsregardingtheintangibleassetsandtheassessmentoflegalaspectsarestillpending.theremainingdifferenceisreportedasprovisionalgoodwillasat31december2010.

assetsanddebtswererecognisedatfairvalueintheprovisionalpurchasepriceallocation.rec-ognitionofintangibleassetsatfairvalueledtoanincreaseincarryingvalue,particularlyinrespectofcustomerbaseandtrademarkrights.

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thepresentvalueoftradereceivables,ateur2.731million,derivesfromthegrosscarryingvalueofreceivables,ateur2.916million,andallowancesfordoubtfulaccountsamountingtoeur185thousand.

deferredtaxassetsofeur1.540millionanddeferredtaxliabilitiesofeur16.390millionwereformedonthetemporarydifferencesarisingfromtheremeasurementofintangibleassetsandobli-gations.

inaccordancewiththeamendedifrs3,ancillarypurchaseexpensesarerecognisedasotheroperatingexpensesinincomestatement.thetotalamountofsuchexpenseswaseur1.017mil-lion.

thefairvalueoftheassetsanddebtswillbeconclusivelydeterminedwithinthefirsttwelvemonthsaftertheacquisition.

thegoodwillcapitalisedduringthereportingperiodisnottaxdeductibleingermay.

reconciliationofacquisitioncostasatthedateofacquisition(6July2010):

[EUR’000]

acquisitioncost 133,209

Cashandcashequivalents 7,777inventories 103tradereceivables 2,731otherassets 4,831property,plantandequipment 2,566intangibleassets 54,358short-termfinancialliabilities -969tradepayables -1,743provisions -5,634otherliabilities -8,810medium-andlong-termfinancialliabilities -11,184deferredtaxliabilities -14,850Total net assets 29,176goodwill 104,033

133,209

in thecourseof theacquisition,Ctsagacquired intercompany loan receivables (eur11.260million)fromtheformershareholdersagainsttheseeticketsgermany/ticketonlinegroup;thesereceivablesarerecognisedunderthefinancialliabilitiesoftheseeticketsgermany/ticketonlinegroup.takingtheacquisitioncostofeur133.209millionintoaccount,aswellastheacquiredinter-companyloanreceivables,resultsinatotalpurchasepriceofeur144.469million.

the resultantdifferencebetween theacquisition costand the remeasurednetassets thatwereacquiredembodiessynergyandothergrowthpotential andwasprovisionally recognisedaseur104.033millioningoodwill.

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finalpurChasepriCealloCationforthetiCketCornergroup

asat30september2010,thepurchasepriceallocationrelatingtotheacquisitionofsharesintheticketcornergroupwasfinallycompletedwithinthestipulated12-monthperiod,inaccordancewithifrs3.45.theprovisionalfairvaluesatthetimeofinitialconsolidationweredisclosedintheselectednotesinthegroupinterimreportasat31march2010.accordingtoifrs3.49,correctionsoftheprovisionalfairvaluesmustbereportedasiftheaccountingforthebusinesscombinationwascom-pletedatthedateofacquisition.

basedonthefinalpurchasepriceallocation,thefollowingtableshowsthefairvaluesatthetimeofinitialconsolidationandthecarryingvaluesimmediatelybeforeacquisitionoftheticketcornergroup:

assetsanddebtswererecognisedatfairvalueinthefinalpurchasepriceallocation.recognitionofintangibleassetsatfairvalueledtoareduction,particularlyinrespectoftrademarkrightsandsoftwareandtoanincreaseincustomerbase.

thefairvalueoftradereceivables,ateur9.444million,derivesfromagrosscarryingvalueofreceivables, ateur9.520million, andallowances for doubtful accounts amounting toeur76thousand.

Fair value at the time of initial

consolidation


before acquisition

[EUR’000] [EUR’000]

Cashandcashequivalents 7,204 7,204inventories 121 121tradereceivables 9,444 9,444otherassets 2,786 2,786Total current assets 19,555 19,555

property,plantandequipment 925 925intangibleassets 17,594 54,281investments 992 992Total non-current assets 19,511 56,198

short-termfinancialliabilities 27,648 27,648tradepayables 2,696 2,696provisions 1,730 1,730otherliabilities 32,282 32,282Total current liabilities 64,356 64,356

medium-andlong-termfinancialliabilities 16,767 16,767pensionprovisions 802 802deferredtaxliabilities 3,829 10,613Total non-current liabilities 21,398 28,182

Total net assets -46,688 -16,785

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deferredtaxliabilitiesofeur3.829millionwereformedonthetemporarydifferencesarisingfromtheremeasurementofintangibleassetsandobligations.

inaccordancewiththeamendedifrs3,ancillarypurchaseexpensesaremainlyrecognisedasotheroperatingexpensesintheincomestatement.thetotalamountofsuchexpenseswaseur510thousand.

inthecontextofthisfinalpurchasepriceallocation,ahigherfairvaluewasrecognisedforsomeindividualintangibleassetscomparedtotheprovisionalrecognitionoffairvalues.inrelationtotheprovisional purchasepriceallocation, the fair valueof the intangible assets changed fromeur15.892milliontoeur17.594million.atgrouplevel,thisresultedinaloweramountofgoodwill,ateur46.688million(provisionalpurchasepriceallocation:eur47.991million).provisionsforpen-sionswererecognisedwithafairvalueofeur802thousand(provisionalpurchasepriceallocation:eur1.044million)andotherassetsateur2.786million(provisionalpurchasepriceallocation:eur2.196million).deferredtaxliabilitieswererecognisedateur3.829million,comparedtopro-visionalrecognitionofeur3.189million.

intheconsolidatedincomestatementasat30June2010,thefinalpurchasepriceallocationhadfurthereffectsonpersonnelexpenses(eur255thousand)andondepreciationandamortisation(eur135thousand).groupearningswerereducedaccordingly.

thesellersagreedinthesaleandpurchaseagreementtocompensateticketcornerforobligationsrelatingtoanofficerentalagreement(eur112thousand),thepossibleredemptionofoutstandingcoupons(eur273thousand)andforanyoutstandingresaleofrightstothelivemusicsponsoringagreement(eur205thousand).inthecontextofthepurchasepriceallocation,theeur590thou-sandinprovisionswerethereforeoffsetbyreceivablestothesameamount.

thegoodwillcapitalisedduringthereportingperiodisnottaxdeductibleinswitzerland.

reconciliationofacquisitioncostasatthedateofacquisition(5march2010):

[EUR’000]

acquisitioncost 0

Cashandcashequivalents 7,204inventories 121tradereceivables 9,444otherassets 2,786property,plantandequipment 925intangibleassets 17,594investments 992short-termfinancialliabilities -27,648tradepayables -2,696provisions -1,730otherliabilities -32,282medium-andlong-termfinancialliabilities -16,767pensionprovisions -802deferredtaxliabilities -3,829Total net assets -46,688goodwill 46,688

0

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inthecourseoftheacquisition,eventimChag,Zurich,acquiredintercompanyloanreceivablesfrom the formershareholdersaswellasbank receivablesagainst theticketcornergroup (eur44.415million);thesereceivablesarerecognisedunderthefinancialliabilitiesoftheticketcornergroup.takingtheacquisitioncostofeur0intoaccount,aswellastheacquiredloanandbankreceivables,resultsinatotalpurchasepriceofeur44.415million.

theresultantdifferencebetweentheacquisitioncostandtheremeasurednetassetsthatwereacquiredembodiessynergyandothergrowthpotentialandwasprovisionallyrecognisedaseur46.688millioningoodwill.

provisionalpurChasepriCealloCationfortiCketerias.r.l.

basedontheprovisionalpurchasepriceallocation,thefollowingtableshowsthefairvaluesatthetimeofinitialconsolidationandthecarryingvaluesimmediatelybeforeacquisitionofticketerias.r.l.:

Fair value at the time of initial

consolidation


before acquisition

[EUR’000] [EUR’000]

Cashandcashequivalents 239 239inventories 12 12tradereceivables 285 285otherassets 155 155Total current assets 691 691

property,plantandequipment 48 48intangibleassets 836 36investments 105 105deferredtaxassets 0 34Total non-current assets 989 223

tradepayables 106 106provisions 26 26otherliabilities 537 537Total current liabilities 669 669

pensionprovisions 39 39deferredtaxliabilities 220 0Total non-current liabilities 259 39

Total net assets 752 206

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asat31december2010,thepurchasepriceallocationisstillprovisionalbecauseinvestigationsregardingtheintangibleassetsandtheassessmentoflegalaspectsarestillpending.theremainingdifferenceisreportedasprovisionalgoodwillasat31december2010.

assetsanddebtswererecognisedatfairvalueintheprovisionalpurchasepriceallocation.rec-ognitionofintangibleassetsatfairvalueledtoanincreaseincustomerbase.

thepresentvalueoftradereceivables,ateur285thousand,correspondstothegrosscarryingvalueofreceivables.noallowancesfordoubtfulaccountshavebeenmade.

deferredtaxliabilitiesofeur220thousandwereformedonthetemporarydifferencearisingfromtherevaluationofintangibleassets.

inaccordancewiththeamendedifrs3,ancillarypurchaseexpensesarerecognisedasotheroperatingexpensesinincomestatement.thetotalamountofsuchexpenseswaseur145thou-sand.

thefairvalueoftheassetsanddebtswillbeconclusivelydeterminedwithinthefirsttwelvemonthsaftertheacquisition.

thegoodwillcapitalisedduringthereportingperiodisnottaxdeductibleinitaly.

reconciliationofacquisitioncostasatthedateofacquisition(13september2010):

[EUR’000]

acquisitioncost 1,000

Cashandcashequivalents 239inventories 12tradereceivables 285otherassets 155property,plantandequipment 48intangibleassets 836investments 105tradepayables -106provisions -26otherliabilities -537pensionprovisions -39deferredtaxliabilities -220Total net assets 752non-controllinginterest -351goodwill 599

1,000

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theresultantdifferencebetweentheacquisitioncostandtheremeasurednetassetsthatwereacquiredembodiessynergyandothergrowthpotentialandwasprovisionallyrecognisedaseur599thousandingoodwill.

1.6.2 disposalofinterestsintheliveentertainmentsegment

the following companieswere deconsolidated in the liveentertainment segment during thereportingperiod:

witheffectfrom30June2010,medusamusicgroupgmbh,bremen(hereinafter:medusa),sold5.2%ofthesharesinfkpscorpiokonzertproduktionengmbh,hamburg(hereinafter:fkpscorpio).thismeansthatmedusanowholdsonly45%ofthesharesinthatcompany.thissaleofsharesledtolossofcontrolbymedusa,withtheresultthatfkpscorpioanditssubsidiarieswillnolongerbeincludedinconsolidationandareaccountedforasassociates.

inaccordancewithias27,fkpscorpioanditssubsidiariesareincludedatequityintheconsoli-datedfinancialstatementsasat thebalancesheetdate,asanassociate,andrecognisedat fairvalue.thetotalincomeresultingfromthetransitionfromfullconsolidationtorecognitionatequityisreportedintheincomestatementunderotheroperatingincome.

theeur428thousandprofitresultingfromthetransitionfromfullconsolidationtorecognitionatequityincludestheportionofprofitattributabletorecognising,atfairvalue,the45%interestinfkpscorpioretainedbythegroup.theprofitattributabletorecognising,atfairvalue,the45%interestinfkpscorpioretainedbythegroup(eur1.189million)iscalculatedbysubtracting45%ofthecarryingvalueofthenetassets(eur-729thousand)fromthefairvalueoftheretainedinvestmentvaluedatequity(eur1.918million).

[EUR’000]

sellingprice 130fairvalueofassociate 1,918Carryingvalueofnetassets -1,620Total income resulting from the transition from full consolidation to recognition at equity 428

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1.7 listofinvestments

anoverviewofinformationpursuantto§313(2)hgb,whichispartofthesenotes,waswaivedforthesakeofclarity.thesedetailsarepostedonlineattheCtsagwebsite.

1.8 CurrenCytranslationprinCiples

businesstransactionswhicharemadebygroupcompaniesincurrenciesotherthanthelocalcur-rencyaretranslatedattherateapplyingonthedateoftransaction.

the financial statements of foreign subsidiarieswhose currency is not theeuroare translatedusingthefunctionalmethod.thefunctionalcurrencyusedforthosepartsofthecompanyoutsidegermany is the localcurrency ineachcase.accordingly,assetsand liabilitiesofentitiesoutsidegermanyoroutsidetheeurozonearetranslatedtoeurousingtherateofexchangeonthebalancesheetdate.revenuesandexpensesaretranslatedusingtheaverageexchangeratefortherespec-tivefinancialyear.Currencytranslationdifferencesaredisclosedasaseparateiteminshareholders’equity.

1.9 mainaCCountingpoliCies

aCCountingpoliCies

the followingaccountingpolicies remainedunchanged compared to the year before,with theexceptionoftheamendmentstoifrs3,ias27andias28.

ChangesinaCCountingpoliCies

theaccountingpoliciesforrecognitionofnon-controllinginterests,lossofcontrolandsignificantinfluencechangedwitheffect from1January2010,when ias27r ‘Consolidatedandseparatefinancial statements’ becameapplicable.the amendments of ias 27 involved consequentialamendmentstoias28‘investmentsinassociates’andtoias31‘interestsinJointventures’.untilnow, transactionswith non-controlling interests have been treated as transactionswith partiesexternaltothegroup.disposalsofsharestonon-controllinginterestsresultedingainsandlossesintheconsolidatedfinancialstatements.Conversely,purchasesofsharesinnon-controllinginterestsresultedinrecognitionofgoodwill,toanamountequaltothedifferencebetweenthepurchasepriceandtheproportionalcarryingvalueofthesubsidiary’snetassets.whensharesweresoldinwholeorinpart,thecompany’sproportionateshareinshareholders’equitywasreclassifiedintheincomestatementandintheretainedearnings.

thegrouphasappliedthenewaccountingmethodtotransactionsoccurringonorafter1January2010.nocorrectionstoamountsalreadyrecognisedintheconsolidatedfinancialstatementswerenecessaryasaconsequence.

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noteConCerningreCognitioninaCCordanCewithias32

inaccordancewithias32,contractswhichobligateacompanytopurchaseitsownequityinstru-ments are recognisedas financial liabilities carried at the present value of the purchaseprice.thisprinciplealsoapplieswhentheobligationtopurchasesuchinstrumentsisconditionalonthecontractualpartnerexercisinganoption,andisindependentoftheprobabilityofsuchoptionbeingexercised. in compliancewith changes in internationalaccountingpractice, thisprinciple isalsoapplicable to the forwardpurchaseofnon-controllingsharesand toputoptionsgranted tonon-controllinginterestsintheCtsgroup.inordertopresentthepotentialpurchasepriceobligations,thesenon-controllinginterestsarereclassifiedasliabilitiesinsteadofshareholders’equity.inaddi-tion,goodwilliscapitalisedtotheamountofdifferencebetweenthepresentvalueoftheliabilitiesandthecarryingamountofthenon-controllinginterests,providedthatthepurchasepriceobliga-tionsresultingfromputoptionsareforafixedstrikepriceandalltheopportunitiesandrisksderivingfromtheputoptionarekeptwithintheCtsgroup.

CashandCasheQuivalents

Cashandcashequivalentsincludebankbalancesandcashinhand.bankbalancesandcashinhandaremeasuredattheirnominalvalueatthebalancesheetdate.

reCeivables

receivablesandother assets are carriedat amortised costminusadjustments for discerniblerisks.thegroupisfundamentallyexposedtopotentialdefaultrisksinrespectoftradereceivablesandother receivables.adequate considerationwasgiven to these risks bymakingappropriateallowancesfordoubtfulaccounts.

inventories

inventoriesarecarriedatcostofpurchase,takingancillaryexpensesintoaccountanddeductinganybonusesordiscountsreceived,oratcostofsales,oratthenetrealisablevalueonthebalancesheetdate.borrowingcostsforinventoriesarenotcapitalised,butarerecognisedasexpenseintheperiodinwhichtheyareincurred,unlesstheyarequalifyingassetswithinthemeaningofias23.

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finanCinginstruments

thestatedvaluesofthegroup’sfinancinginstruments,whichincludecashandcashequivalents,loans,financialinvestments,tradereceivablesandpayables,receivablesfromandpayablestoaffili-atedandassociatedcompanies,otherassetsandliabilities,andfinancial liabilitiesarecompliantwiththeaccountingprinciplesinias39.

asabasicprinciple,financialassetsareclassifiedintothefollowingcategoriesinaccordancewithias39:

•loansandreceivables

•financialassetscarriedatfairvaluethroughprofitorloss,

•held-to-maturityinvestments

•available-for-salefinancialassets.

financialliabilitiesarestatedatamortisedcostusingtheeffectiveinterestmethod.

Classificationdependson therespectivepurpose forwhich the financialassetswereacquired.managementdetermineshowfinancialassetsaretobeclassifiedwhentheyareinitiallyrecognised,andreviewsthisclassificationateveryclosingdate.

in the reporting year, thegroupdid not classify any financial instruments as ‘held-to-maturityinvestments’or‘financialassetscarriedatfairvaluethroughprofitorloss’.somefinancialassetsclassifiedas‘loansandreceivables’andas‘available-for-salefinancialassets’areheld.

loansand receivablesarenon-derivative financialassetswith fixedordeterminablepaymentsthatarenotquotedinanactivemarket.theyarisewhenthegroupprovidesmoney,goodsorserv-icesdirectlytoadebtorwithoutanyintentiontotradethereceivables.loansandreceivablesarecarriedinthebalancesheetundercashandcashequivalents,loans,tradereceivables,receivablesfromaffiliatedandassociatedcompaniesandunderotherassets.loansandreceivablesarecar-riedatamortisedcost.ateachreportingdate,thecarryingvaluesoffinancialassetsarereviewedtodeterminewhether thereareanyobjectivematerial indicationsof impairment.any impairmentexpenseiscarriedthroughprofitorloss.

theavailable-for-sale financial assets include investments in other companies and securities.investmentsarestatedattheirrespectivecostofpurchasebecausethereisnoactivemarketforthesecompanies,andbecausepresentfairvaluescannotreasonablybecalculatedwithanyreli-ability.ifthereareanyindicationsthatfairvaluesarelower,theseareappliedaccordingly.securitiesareinitiallyrecognisedattheirfairvalueonthesettlementdate.gainsandlossesarerecognisedinshareholders’equity,notthroughprofitandloss.

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intangibleassetsandproperty,plantandeQuipment

intangibleassetswithadeterminateusefullifeandproperty,plantandequipmentarecarriedattheircostofpurchaseorcostofsales,minussystematicstraight-linedepreciationandamortisation.borrowingcostsforintangibleassetsandforproperty,plantandequipmentarenotcapitalised,butarerecognisedasexpenseintheperiodinwhichtheyareincurred,unlesstheyarequalifyingassetswithinthemeaningofias23.

development costs for proprietary software are recognisedas assets if theymeet the criteriaspecifiedinias38.thecostsdirectlyattributabletosoftwareincludethepersonnelexpensesfortheemployeesinvolvedindevelopment,aswellasanappropriateproportionoftherelevantindi-rectcosts.Capitaliseddevelopmentcostsforsoftwareareamortisedovertheirestimatedlifetime.animpairmenttestisperformedonceayearforthecash-generatingunitinrespectofcapitaliseddevelopmentcoststhatarenotyetinuse.

systematicdepreciationandamortisationofintangibleassetsandproperty,plantandequipmentismainlybasedonthefollowingusefuleconomiclives:

•software,licences:2-9years

•trademarks:5-10years

•Customerbase:4-12years

•otherproperty,plantandofficeequipment:3-13years

inaccordancewithifrs3,goodwill isnotamortisedsystematically,but isreviewedfor impair-mentonthebasisoftherecoverableamountforthecash-generatingunittowhichthegoodwillisallocated.fortheimpairmenttest,thegoodwillissubdividedandallocatedtothecash-generatingunits.thegoodwillisallocatedtothosecash-generatingunitsexpectedtoderivebenefitsfromthebusinesscombinationinwhichthegoodwillarose.

thegrouptestsitsgoodwillforimpairmentatleastonceayearonthebalancesheetdate,orifsignificanteventsorchangesincircumstancesindicatethatthefairvalueofareportingentitywithinthegroupmightbelowerthanitscarryingamount.impairmentsofgoodwillmaynotbereversed.

in compliancewith ias36, thegroup routinely assesses the carrying valuesof all assets forpossibleimpairment.ifeventsorchangesincircumstancesprovidegroundsforbelievingthatthecarryingvalueofsuchanassetmightnolongerreachtheapplicableamount,thegroupmakesacomparisonbetweentherecoverableamountandthecarryingvalueoftheparticularasset(impair-menttest).iftheassetisimpaired,thegrouprecordsanimpairmentlosssothattheassetiswrittendowntotherecoverableamount.innocasedidthecarryingvaluesofreportingentitiesexceedtherespectivefairvalue,sotherewerenoindicationsofimpairmentstothestatedvalueofanyreportingentityinthe2010financialyear.

theCtsgroupisalesseeofrentedproperty,plantandequipmentunderleasingagreements.inthosecasesinwhichtheCtsgroupsubstantiallyassumestheopportunitiesandrisksfromusingthe leased items, thesearecapitalisedaccordingly (finance leaseagreements).Capitalisation isperformedatthelowerofthefairvalueoftheleaseditemandthepresentvalueoftheminimumleasepayments.theseassetsaresystematicallydepreciatedovertheirusefullifeorovertheterm

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oftheleasingagreement,whicheverisshorter.thedepreciationmethodappliedtosimilaracquiredassetsisused.theliabilitiesresultingfromfutureleasingratesarecarriedunderliabilitiesatthelowerofthefairvalueoftheleaseditemandthepresentvalueoftheminimumleasepayments.each leasing instalment isdivided intoan interestcomponentandarepaymentcomponent.theinterestcomponentisrecognisedintheincomestatement.liabilitiesfromleasingagreementsinwhichtheCtsgroupisnottheeconomicowneroftheleasedasset(operatinglease)arerecog-nisedasexpense.

deferredtaXes

deferredtaxassetsandliabilitiesarerecognisedincompliancewithias12,accordingtowhichdeferredtaxesarereportedusingthebalancesheetliabilitiesmethod.

deferred tax assets and liabilities are formed for temporary differences between the carryingamountsintheconsolidatedbalancesheetandinthefiscalbalancesheet,aswellasforfiscallosscarryforwards.deferredtaxassetsarerecognisedifitislikelythattaxableearningswillbeavailableagainstwhichthedeductibletemporarydifferencecanbeapplied.deferredtaxassetsareformedonexistinglosscarryforwardsonlytotheextentthatitislikely,takingcurrentbudgetingintoaccount,thattheselosscarryforwardscanberealised.deferredtaxassetsandliabilitiesarevaluedattheapplicabletaxationratesthatmustprospectivelybeappliedtothetaxableincomeinthoseyearsinwhichthetemporarydifferencesareexpectedtoberecoveredorsettled.theimpactofachangedtaxationrateondeferredassetsandliabilitiesiscarriedthroughprofitandloss.

liabilities

liabilitiesarerecognisedatamortisedcostusingtheeffectiveinterestmethod,wherenecessary.theircompositionandremainingtermsareshownintheanalysisofliabilities.

provisions

inaccordancewithias37,otherprovisionswereformedwhencommitmentstowardsthirdpartiesexistthatarereasonablylikelytorequiresettlement.theamountrecognisedasaprovisionisthebestestimateoftheexpenditurerequiredtosettlethepresentobligationattheclosingdate.

provisions forpensionsandsimilarobligationsare formedfordefinedbenefitplans.theseareobligationsonthepartofthecompanyresultingfrompensionexpectanciesandongoingbenefitspaidtoactiveemployeeswhoareeligibleforbenefits.pensionobligationsaredependentonyearsofserviceandthepayleveloftherespectiveemployee.

provisions fordefinedbenefitplansarecalculatedusing theprojectedunitcreditmethod.thislattermethodtakesaccountnotonlyofthepensionsandacquiredbenefitsknownonthereport-ingdate,butalsoanyanticipatedincreasesinsalariesandpensions.thecalculationisbasedonactuarialexpertises,takingbiometricfactorsintoaccount.actuarialgainsandlossesresultingfromadjustments and amendments of actuarial assumptions in linewith experience are recognisedthroughprofitandloss.

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if reinsurancepoliciesexist forpensioncommitmentsandcanonlybeused tocover theben-efitsdueunderthepensioncommitments,andtheinsurancepolicy ispledgedtothebeneficiaryemployee,thesearetreatedasqualifyinginsurancepoliciesinaccordancewithias19.thecover-agevaluesaretreatedasplanassetsandareoffsetagainsttherespectivepensionprovisionsinthebalancesheet.


transactionswithnon-controlling interestare treatedas transactionswithequityholdersof thegroup.anydifference,arising fromacquisitionofanon-controlling interest,between theconsid-erationpaidandtherespectiveshareofthecarryingamountofthenetassetsofthesubsidiaryisrecognisedinshareholders’equity.gainsandlossesensuingondisposalofnon-controllinginterestbutwithnolossincontrolarelikewiserecognisedinshareholders’equity.

reCognitionofrevenue

revenueandotherincomearerecognisedwhenacontracthasbeenconcludedwithlegaleffect,deliveryhasbeenmadeortheservicehasbeenperformed,apriceisfixedanddeterminable,anditcanbeassumedthatthepricewillbepaid.revenueisstatedlessdiscounts,pricereductions,customerbonusesandrebates.pricereductionsreducerevenueassoonastherespectiverevenueisrecognised.

revenueintheticketingsegmentthatrelatestothesaleofticketstofinalcustomersisrealisedwhentherespectiveCtsticketingcompanydeliverstheticketstothefinalcustomer.intheliveentertainmentsegment,ticketrevenuegeneratedinthepresalesperiodispostedbythepromoterontheliabilitiessideasadvancepaymentsreceived.whentheeventissubsequentlyheld,theseadvancepaymentsaretransferredtorevenueandtheprofitsarerealised.

eXpensereCognition

expensesarerecognisedassuchwhentheyareincurred.

softwaredevelopmentservicesarerecognisedasexpenseiftheydonotmeettherequirementsofias38,andaremostlyincludedincostofsales.

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estimatesandassessmentsbymanagement

whenpreparingtheconsolidatedfinancialstatements,itisnecessarytoacertaindegreetomakeestimatesandassumptionsthataffecttheassetsandliabilities,thedisclosureofcontingentliabili-tiesasatthebalancesheetdateandthestatementofincomeandexpenditureduringthefinancialyear.inparticular,itisnecessarytomakeassumptionswhenperformingtheannualimpairmenttestongoodwillandwhenrecognisingdeferredtaxassetsinrespectoflosscarryforwards.theactualamountsmaydeviatefromtherespectiveestimates.

impairmentofgoodwill

thegroupconductsannualreviews,inconformitywiththeaccountingpoliciesdescribedabove,todeterminewhetherthereisanyimpairmentofgoodwill.therecoverableamountofcash-gener-atingunitswasmeasuredonthebasisofcalculatedfairvalueminuscostsofsale.thesecalcula-tionsmustbederivedfromassumptionsbasedonmanagementestimates.iftrendsarisethatarebeyondthecontrolofmanagement,futurecarryingvaluesmaydeviatefromtheestimatedvaluesasoriginallyanticipated. ifactualdevelopmentsdivergefromexpectations, thepremissesand, ifnecessary,thecarryingvaluesofthegoodwillareadjustedaccordingly.

deferredtaXassets

deferredtaxassetsinrespectoffiscallosscarryforwardsandtemporarydifferencesarerecog-nisedintheconsolidatedfinancialstatements.whenrecognisingdeferredtaxassets,themanage-mentmustmakeestimatesregardingtherecoverability.deferredtaxassetsarerecognisedtotheextentthatitislikelythattheycanbeused.theuseofdeferredtaxassetsdependsonthepossibilityofgeneratingsufficienttaxableincomeintherespectivetaxcategoryandintherespectivefiscaljurisdiction.assessingthelikelihoodoffutureusabilitydependsonavarietyoffactors,suchaspastearningsperformance,operativeplanningand taxplanningstrategies. ifestimatesdiverge fromactualevents,carryingvaluesmustbeadjustedaccordinglyifthereisanydoubt.

2. notestotheConsolidatedbalanCesheet

CashandCasheQuivalents(1)

Cashandcashequivalentsofeur178.036million(prioryear:eur229.794million)arepredomi-nantlybankbalances.

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tradereCeivables(Current)(2)

Currenttradereceivablestotallingeur31.893million(prioryear:eur19.799million)arepayablewithinoneyear.theincreaseismainlytheresultofthegreaterscopeofconsolidation.

reCeivablesfromaffiliatedandassoCiatedCompanies(Current)(3)

theeur6.979millionincurrentreceivablesfromaffiliatedandassociatedcompanies(prioryear:eur3.566million)relateprimarilytoreceivablesfromtheassociatesfkpscorpioanditssubsidiar-ies(eur5.189million,prioryear:eur0)andtoreceivablesfromsubsidiariesineasterneuropethatarenotconsolidatedduetoinsignificance(eur1.515million;prioryear:eur3.291million).theincreaseresultsspecificallyfromthereceivablesfromfkpscorpioanditssubsidiaries,sincethelatterhavenolongerbeenfullyconsolidatedsince1July2010,butareincludedinthefinancialstatementsasassociatedcompaniesinstead.

inventories(4)

inventoriescomprisedthefollowingitems:

31.12.2010 31.12.2009 Change

[EUR’000] [EUR’000] [EUR’000]

rawmaterialsandsupplies 314 471 -157finishedgoodsandmerchandise 1,272 1,471 -199paymentsonaccount 17,729 13,629 4,100

19,315 15,571 3,744

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rawmaterialsandsupplies include, interalia, blank tickets.finishedgoodsandmerchandisemainly related to ithardware,merchandisingarticlesand tickets.paymentsonaccountpertainmainlytoprepaidproductioncostsintheliveentertainmentsegment(e.g.artists’fees)foreventstakingplacein2011.

noimpairmentsofinventoriesweremade.

reCeivablesfrominCometaX(Current)(5)

receivablesfromincometax,ateur10.513million(prioryear:eur8.805million),relatetotaxrefundentitlementsinconjunctionwithadvanceprepayments,andtocapitalgainstax.

otherassets(Current)(6)

otherassets,ateur41.381million(prioryear:eur47.722million)comprise financialassets(eur31.726million,prioryear:eur43.580million)andnon-financialassets(eur9.655million,prioryear:eur4.142million).

otherfinancialassetsrelate,interalia,toreceivablesfromticketpre-sales,ateur19.649million(prioryear:eur27.541million),tocurrentloans,ateur4.973million(prioryear:eur5.763mil-lion),andtosecuritiesmeasuredatfairvaluebutnotthroughprofitandloss,ateur3.014million(prioryear:eur2.016million).thedecreaseinreceivablesfromticketpre-salesresults,inparticu-lar,fromhigherpre-salesinthefourthquarterof2009,e.g.foranaC/dCconcertinwels.

othernon-financialassetsrelatetorefundclaimsinrespectofsalestaxandothertaxes,ateur3.323million(prioryear:eur1.495million),otherreceivablesamountingtoeur569thousand(prioryear:eur407thousand)andtooneitemforrecognitionandaccrualofexpensesandincomeaccordingtoperiod,ateur5.763million(prioryear:eur2.240million),thatmainlyrelatestomar-ketingexpensesandprepaymentsforpromoteragreements,due,interalia,tothenewlyacquiredcompanies.

inthe2010financialyear,collateralamountingtoeur558thousand(prioryear:eur688thou-sand)wereprovidedbygroupcompanies,includingeur457thousandforrentaldeposits(prioryear:eur249thousand).

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property,plantandeQuipment(7)

thecompositionanddevelopmentisshowninthefollowingtable:

Other real estate, land rights and

buildings, including buildings on third-

party propertiesTechnical equipment

and machinery

Other facilities, operating and

office equipmentPayments on

account Total

[EUR’000] [EUR’000] [EUR’000] [EUR’000] [EUR’000]

historical cost1January2009 118 851 22,656 658 24,283additionfromchangeinthescopeofconsolidation 0 0 10 0 10addition 145 92 4,934 765 5,936disposal 0 -119 -414 0 -533reclassification 0 0 660 -660 0Currencydifferences 0 0 -8 0 -831 December 2009 263 824 27,838 763 29,688

additionfromchangeinthescopeofconsolidation 153 109 3,314 0 3,576disposalfromchangeinthescopeofconsolidation 0 -317 -2,358 0 -2,675addition 354 111 5,699 13 6,177disposal -10 -30 -755 -46 -841reclassification 0 0 730 -730 0Currencydifferences 24 1 248 0 27331 December 2010 784 698 34,716 0 36,198

Accumulated depreciation and amortisation1January2009 43 495 14,580 0 15,118addition 36 124 3,575 0 3,735disposal 0 -30 -373 0 -403Currencydifferences 0 0 -2 0 -231 December 2009 79 589 17,780 0 18,448

disposalfromchangeinthescopeofconsolidation 0 -162 -1,816 0 -1,978addition 105 161 4,468 0 4,734disposal -4 -15 -424 0 -443Currencydifferences 3 0 77 0 8031 December 2010 183 573 20,085 0 20,841

Carrying value1January2009 75 356 8,076 658 9,16531december2009 184 235 10,058 763 11,24031 December 2010 601 125 14,631 0 15,357

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intangibleassets(8),goodwill(15)


Concessions, industrial property rights and similar rights and assets,

and licences to such rights and assets

Capitalized development costs Goodwill Customer base

Payments on ac-count / Proprietary

software in progress Total

[EUR’000] [EUR’000] [EUR’000] [EUR’000] [EUR’000] [EUR’000]

historical cost1January2009 35,384 6,567 94,785 12,331 1,010 150,077additionfromchangeinscopeofconsolidation 2 0 0 0 0 2addition 922 2,903 8,232 26 452 12,535disposal -395 -25 -1,221 0 0 -1,641reclassification 7 720 0 0 -727 0Currencydifferences -11 -10 0 0 -1 -2231 December 2009 35,909 10,155 101,796 12,357 734 160,951

additionfromchangeinscopeofconsolidation 14,500 0 151,580 58,210 178 224,468disposalfromchangeinscopeofconsolidation -3,065 0 -2,178 0 0 -5,243addition 1,005 5,317 0 2,500 665 9,487disposal -282 0 -11 0 0 -293reclassification 0 282 0 0 -282 0Currencydifferences 454 452 7,762 2,348 1 11,01731 December 2010 48,521 16,206 258,949 75,415 1,296 400,387

Accumulated depreciation and amortisation1January2009 26,441 1,024 4,867 6,651 0 38,983addition 2,911 1,299 0 748 0 4,958disposal -392 -15 0 0 0 -407Currencydifferences -4 0 0 0 0 -431 December 2009 28,956 2,308 4,867 7,399 0 43,530

disposalfromchangeinscopeofconsolidation -1,412 0 -177 0 0 -1,589addition 4,916 1,747 0 6,042 0 12,705disposal -281 0 0 0 0 -281Currencydifferences 95 76 0 194 0 36531 December 2010 32,274 4,131 4,690 13,635 0 54,730

Carrying values1January2009 8,943 5,543 89,918 5,680 1,010 111,09431december2009 6,953 7,847 96,929 4,958 734 117,42131 December 2010 16,247 12,075 254,259 61,780 1,296 345,657

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additionsfromchangeinscopeofconsolidation,ateur224.468million,aremainlytheresultoftheprovisionalpurchasepriceallocationinrespectofseeticketsgermany/ticketonlinegroup,andofthefinalpurchasepriceallocationinrespectofthetheticketcornergroup.disposalsfromchangeinscopeofconsolidation,ateur5.243million,relatetodisposalsresultingfromthetransi-tionfromfullconsolidationoffkpscorpioanditssubsidiariestorecognitionatequity.

theotherinvestmentsinintangibleassetsandgoodwill,ateur9.487million,relatetoadditionsforsoftwareandlicences(eur1.005million),capitaliseddevelopmentcosts(eur5.317million),paymentsonaccount/proprietarysoftwareinprogress(eur665thousand),andcustomerbase(eur2.500million).

theadditionsforcapitaliseddevelopmentcosts(eur5.317million)andthepaymentsonaccount/proprietarysoftwareinprogress(eur665thousand)relate,interalia,tofurtherdevelopmentofticketingsystems.oftheseinvestments,eur4.768millionwereforproprietarysoftwareandeur1.214millionforexternalsoftwaredevelopment.

notesonthedevelopmentofgoodwillarepresentedbelowunder‘goodwill(15)’.

withtheexceptionofgoodwill,therearenointangibleassetswithunlimitedusefullife.

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investments(9),investmentsinassoCiates(10),loans(11)


Shares in affiliated

companies ParticipationsInvestments in

associates

Loans due to affiliated companies

Security investments Loans Total

[EUR’000] [EUR’000] [EUR’000] [EUR’000] [EUR’000] [EUR’000] [EUR’000]

historical cost1January2009 300 996 224 447 33 1,418 3,418addition 15 1 119 0 0 1 136disposal 0 -131 0 -369 0 -668 -1,168reclassification 0 -12 0 0 0 0 -12Currencydifferences 0 0 0 -2 0 0 -231 December 2009 315 854 343 76 33 751 2,372

additionfromchangeinscopeofconsolidation 0 992 1,918 0 0 104 3,014disposalfromchangeinscopeofconsolidation -12 -7 -182 -51 0 0 -252addition 12 0 20 0 0 92 124disposal 0 -8 -106 -25 -1 -431 -571reclassification -32 0 0 0 0 0 -32Currencydifferences 0 50 0 0 0 18 6831 December 2010 283 1,881 1,993 0 32 534 4,723

Accumulated depreciation and amortisation1January2009 13 156 0 0 5 0 174addition 0 7 0 0 0 341 34831 December 2009 13 163 0 0 5 341 522

disposalfromchangeinscopeofconsolidation -12 -7 0 0 0 0 -19disposal 0 0 0 0 0 -341 -34131 December 2010 1 156 0 0 5 0 162

Carrying values1January2009 287 840 224 447 28 1,418 3,24431december2009 302 691 343 76 28 410 1,85031 December 2010 282 1,725 1,993 0 27 534 4,561

investments(9)

investmentsrelateprimarilytoparticipations,ateur1.725million(prioryear:eur691thousand).

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investmentsinassoCiates(10)

thechangeinscopeofconsolidation,underinvestmentsinassociates,relatestofkpscorpioanditssubsidiaries.thesaleof5.2%ofthesharesinfkpscorpiobymedusainthe2010financialyearledtoalossofcontrolbymedusa.fkpscorpioanditssubsidiariesarethereforeincludedatequity,asassociates,intheconsolidatedfinancialstatementsasatthebalancesheetdate,andrecognisedatfairvalue.thefairvalueonthedateoftransitionfromfullconsolidationtorecognitionatequitywaseur1.918million.

investments in associates comprise the shares infkpscorpio (hamburg),greensavegmbh(würzburg),andgreenfieldfestivalag(hünenberg).

theadjustedcarryingvalueoftheinterestinfkpscorpioiseur1.842million(prioryear:eur0),ingreensaveeur33thousand(prioryear:eur63thousand)andingreenfieldeur118thousand(prioryear:eur280thousand).

thefollowingoverviewshowsaggregatedkeydataoftheassociatesthathavebeenincludedintheconsolidatedfinancialstatementsusingtheequitymethod.thevaluesdonotreflecttheshareapportionedtotheCtsgroup,butthevaluesbasedonafictitious100%shareholding.

*thedisclosuresonrevenueandnetincomeincludethefiguresfortheassociatefkpscorpioanditssubsidiariesfrom1Julyto31december2010.

loans(11)

loans,ateur534thousand,relateentirelytoloanstothirdparties(prioryear:eur410thou-sand).intheprioryear,loansalsoincludedloanreceivablesfromassociates(eur51thousand)andfromaffiliatedcompanies(eur25thousand).

tradereCeivables(non-Current)(12)

non-current trade receivables, ateur212 thousand (prior year:eur1.268million), have aremainingtermofbetweenoneandfiveyears.thedecreaseinreceivablesismainlyattributabletothedeconsolidationoffkpscorpioanditssubsidiaries.

non-currenttradereceivablesareneitherimpairednoroverdueasattheclosingdate.

31.12.2010 31.12.2009

[EUR’000] [EUR’000]

totalassets 18,312 713totalliabilities 22,451 458

revenue* 31,371 4,423netincome* -69 189

97


reCeivablesfromaffiliatedandassoCiatedCompanies(non-Current)(13)

asattheclosingdateof31december2010,therearenonon-currentreceivablesfromaffiliatedandassociatedcompanies.intheprioryear,non-currentreceivablesfromaffiliatedandassociatedcompaniesincludedloansgrantedtoasubsidiaryineasterneurope,ateur1.146million,andareceivablefromanassociate,ateur40thousand.thesubsidiaryineasterneuropewasfullycon-solidatedinthe2010reportingyear.

otherassets(non-Current)(14)

ofthenon-currentotherassets,ateur201thousand(prioryear:eur2.303million),eur200thousand(prioryear:eur2.302million)arefinancialassets.theyear-on-yeardecreaseinnon-currentotherassetsresults,interalia,fromimpairmentsmadeinthereportingyear.thesereceiva-bleshaveamaturityofbetweenoneandfiveyears.

goodwill(15)

thedisclosedgoodwilltotallingeur254.259million(prioryear:eur96.929million)breaksdownintoeur220.356millionintheticketingsegment(prioryear:eur61.025million)andeur33.903millionintheliveentertainmentsegment(prioryear:eur35.904million).

ofthatdisclosedgoodwill,eur1.484million(prioryear:eur20.690million)relatestogoodwillfromputoptions thatareentirelyattributed to theliveentertainmentsegment (prior year:eur1.484million).thedecreaseingoodwillfromputoptionsintheticketingsegementisduetothesharesofsubsidiariesthathadalreadybeenincludedinconsolidation(ticketones.p.a.andCtseventimruo.o.o.)weretenderedandsubsequentlyaccepted,withtheresult thatnoputoptionexistedanylongerasat31december2010.

intheticketingsegment,goodwillincreasedbyeur159.331millioninthereportingyear(takingcurrencytranslationattheswissticketcornergroupintoaccount).thechangemainlyresultsfromthepurchasepriceallocationofthecompaniesacquiredduringthereportingperiod.

in theliveentertainment segment, the transitionoffkpscorpioand its subsidiaries from fullconsolidationtorecognitionatequityledtoadisposalofgoodwillamountingtoeur2.001million.

thisgoodwill isallocated to thecashgeneratingunits(Cgus)of thegroup.thecashgenerat-ingunitscorrespondtothegroupreportingentities(segments)ticketingandliveentertainment.impairmenttestsareperformedongoodwilltodeterminetherecoverableamountofaCgu,equaltothefairvalueminuscostsofsale.thefairvalueisthebestpossibleestimateoftheamountforwhichanindependentthirdpartywouldacquirethecashgeneratingunitonthebalancesheetdate,minusthecostsofsale.thefairvalueiscalculatedonthebasisofacompanyvaluationmodel.thisprocedureandthebasicassumptionsapplytoallCguswithgoodwillthatissubjecttoimpairmenttests.thesecalculationsarebasedonforecastcashflowsderivedfromfive-yearplanning.when

98


determiningbudgetfigures,themanagementtookintoaccountcurrentandfuturelikelihoods,busi-nessandeconomictrends,economicdevelopmentandothercircumstances.thecashflowsintheyearofperpetuitycorrespondtothecashflowinthelastyearoffive-yearplanning.adiscountrateof6.9%wasappliedforthispurpose.thediscountratesusedareinterestratesaftertaxandreflectthespecificriskstowhichtherespectiveCgusandagroupofselectedreferencecompanieswithsimilarriskstructureareexposed.thegroupappliesconstantgrowthratesof1%toextrapolatecashflows.thisgrowthrateisderivedfrompastexperienceanddoesnotexceedthelong-termgrowthoftherespectivemarketsinwhichtheentityoperates.noimpairmentofthegoodwill,sub-dividedaccordingtosegment,wasrequiredinthe2010financialyear.

deferredtaXes(16)

thedeferredtaxassets,ateur2.364million,pertaintothefollowing:

31.12.2010 31.12.2009 Change

[EUR’000] [EUR’000] [EUR’000]

taxlosscarryforwards 1,319 595 724temporarydifferences 1,045 765 280

2,364 1,360 1,004

asat31december2010, theviewof thegroup is that, in thecaseof thedeferred taxassetsincludingtheassetsrecognisedfromuseofthelosscarryforwardsamountingtoeur1.319million(prioryear:eur595thousand),thereisalikelihoodthatthegroupcompanieswillgenerateprofitsofleastthesameamountinfutureperiods.

99


nodeferredtaxassetswererecognisedforeur1.215millioninlosscarryforwardsformunicipaltradetaxpurposes(prioryear:eur4.693million),andforeur561thousandinlosscarryforwardsforcorporationtaxpurposes(prioryear:eur4.851million),andforeur12.319millioninotherlosscarryforwardsforforeigntaxationpurposes(prioryear:eur2.087million).thereasonwhynodeferredtaxassetswereformedinrespectoftheaforementionedlosscarryforwardsisthatitisnotexpectedatpresentthatthetaxrefundclaimswillberealisedinthenearterm.

therateofdeferreddomestictaxationaveraged31%.thisrateincludescorporationtaxat15%,thesolidaritysupplementat5.5%ofthecorporationtaxandanaverage16.5%rateofmunicipaltradetax.forforeignsubsidiariestherespectiveapplicablelocaltaxrateswereapplied.

[EUR’000]

upto4years 36upto5years 111upto6years 97upto7years 2,121indefinite 3,407

5,772

thelosscarryforwardsasat31december2010canbecarriedforwardasfollows:

100


thedeferredtaxassetsandliabilitiesrelatetothefollowingbalancesheetitemsandlosscarryforwards:

thedeferredtaxliabilitiesmainlyresultfromtemporarydifferencesarisingfromthefairvaluemeas-urementofintangibleassetsinthecontextofthepurchasepriceallocationoftheticketcornergroupandtheseeticketsgermany/ticketonlinegroup.

31.12.2010 31.12.2009

Deferred tax assets

Deferred tax liabilities

Deferred tax assets

Deferred tax liabilities

[EUR’000] [EUR’000] [EUR’000] [EUR’000]

tradereceivables 442 509 467 195otherassets 1,510 134 156 231Current assets 1,952 643 623 426

property,plantandequipment 0 0 0 64

intangibleassets 3,789 21,330 296 702loans 0 12 307 0Non-current assets 3,789 21,342 603 766

otherprovisions 126 79 14 0otherliabilities 113 221 36 3Current liabilities 239 300 50 3

liabilitiestobanks 0 1,031 0 0pensionprovisions 480 29 3 99Non-current liabilities 480 1,060 3 99

losscarryforwards 1,319 0 595 0Total 7,779 23,345 1,874 1,294

offset -5,415 -5,415 -514 -514Deferred taxes 2,364 17,930 1,360 780

101


short-termfinanCialliabilitiesandCurrentportionoflong-termfinan-Cialliabilities(17)

theshort-termfinancialliabilitiesandthecurrentportionoflong-termfinancialliabilities,amount-ingtoeur6.567million(prioryear:eur25.218million),relatetoeur1.931millioninshort-termpurchasepriceobligationsderivingfromputoptions(prioryear:eur22.430million),whichhadtoberecognisedinaccordancewithias32,topurchasepriceobligationsderivingfromtheacquisitionofsharesinsubsidiariesalreadyincludedinconsolidation,ateur4.135million(prioryear:eur1.725million)andtoliabilitiestobanks,ateur501thousand(prioryear:eur1.063million).

thedecreaseinshort-termpurchasepriceobligationsforputoptionsisattributabletothesharesinanalreadyconsolidatedsubsidiary,ticketones.p.a.,beingtenderedandsubsequentlyacceptedduringthereportingperiod.

liabilities tobanksweresubject to interestatnormalmarket rates.the interesteffectscausedbycompoundingtheshort-termpurchasepriceobligationsforputoptionswerestatedaseur94thousand(prioryear:eur1.017million)inthefinancialresult.

tradepayables(18)

tradepayables,ateur38.743million(prioryear:eur35.890million)arepayablewithinoneyear.

payablestoaffiliatedandassoCiatedCompanies(19)

payablestoaffiliatedandassociatedcompanies,ateur2.920million(prioryear:eur1.230mil-lion),areprimarilyforsuppliesandservices;ofthattotal,eur2.579millionareliabilitiestoassoci-atesintheliveentertainmentsegment(prioryear:eur0).

advanCepaymentsreCeived(20)

theadvancepaymentsreceived,ateur64.550million(prioryear:eur101.766million),resultfrom ticketmonies already received for future events in the liveentertainment segment.thedecreaseinadvancepaymentsreceivedismainlyattributabletoahighervolumeofticketmoniesbeingreceivedinthefourthquarterofthepreviousyearfrompre-salesofmajortours(includingu2ingermanyandaC/dCinaustria).inthecurrentfinancialyear,therewerenopre-salesofsimilardimensionsinthefourthquarterformajortours,soadvancepaymentsreceiveddecreasedaccord-ingly

theadvancepaymentsreceivedareposted torevenueafter therespectiveeventshavetakenplaceandaccountshavebeensettled.

102


01.01.2010Change in consoli-

dated companies Consumption Reversal AdditionCurrency

differences 31.12.2010


workforcerestructuring 0 0 0 0 2,430 0 2,430other 1,331 1,739 -1,890 -217 871 121 1,955Other provisions 1,331 1,739 -1,890 -217 3,301 121 4,385

otherprovisions(21)

Changesinotherprovisionsareshowninthefollowingtable:

provisionsforworkforcerestructuringinconnectionwithintegrationofthenewlyacquiredcom-panieswereformedinthereportingyear.theotherprovisionsrelatetomanydifferentitemswithindividual carrying amounts of only secondary importance, such as commission payments andlitigationrisks.

provisionsfortaXes(22)

Changesintaxprovisionsareshowninthefollowingtable:

duetoprepaidtaxesonincomeforthe2010financialyear,therearefeweradditionstotaxprovi-sionscomparedtotheprioryear.

01.01.2010Change in consoli-

dated companies Consumption ReversalCurrency

differences Addition 31.12.2010


Tax provisions 10,078 3,504 -11,303 -5 210 5,875 8,359

103


otherliabilities(Current)(23)

otherliabilitiesamountingtoeur150.379million(prioryear:eur125.039million),andcompriseeur121.479millioninfinancialliabilities(prioryear:eur98.413million)andeur28.900millioninnon-financialliabilities(prioryear:eur26.626million).

the financial liabilities include liabilities fromticketingmoniesnotyet invoiced,ateur116.767million(prioryear:eur94.249million),liabilitiesfromticketinsurance,ateur1.224million(prioryear:eur362thousand),liabilitiesfromthird-partyconcerts,ateur985thousand(prioryear:eur1.396million),liabilitiesfromfinanceleasesduetothenewcompaniesbeingincludedinconsolida-tion,ateur178thousand(prioryear:eur0),andeur2.325millioninotherfinancialliabilities(prioryear:eur2.406million).

thenon-financialliabilitiesresultfromtaxliabilities,ateur11.651million(prioryear:eur12.298million),liabilitiesforsocialsecurity,ateur532thousand(prioryear:eur2.588million),liabilitiestopersonnel,ateur8.062million(prioryear:eur6.629million),creditvoucherliabilities,ateur4.638million(prioryear:eur3.223million),deferredrevenue,ateur2.024million(prioryear:eur602thousand),andothernon-financialliabilities,ateur1.993million(prioryear:eur1.286million).

medium-andlong-termfinanCialliabilities(24)

asatthebalancesheetdate,medium-andlong-termfinancialliabilitiesamountingtoeur199.791millionwerecarried(prioryear:eur7.961million).ofthemedium-andlong-termfinancialliabili-ties,eur188.081million relate tobank loans (prior year:eur4.199million)andeur11.710milliontoliabilitiesfrompurchasepriceobligationsforacquisitionofsharesinsubsidiariesalreadyincludedinconsolidation(prioryear:eur3.762million).theincreaseinmedium-andlong-termfinancialliabilitiesaroseprimarilyinconnectionwithexternalborrowingtofinancethepurchaseofshares intheticketcornergroupandtheseeticketgermany/ticketonlinegroup.duetoanexistingloanobligationdenominatedinswissfrancs,translationtoeuroontheclosingdatehadaccountingeffectsontheloanobligation.

sharesinasubsidiaryalreadyincludedinconsolidationwereprovidedascollateralforpartofabankloan.thecarryingvalueofthesharesinthestandalonefinancialstatementsiseur4.451million.duetopositiveearningsperformanceexpectedforthecompany,itisassumedthatnousewillbemadeofthecollateral.

104


otherliabilities(non-Current)(25)

otherlong-termliabilities,ateur320thousand(prioryear:eur12thousand)mainlyconcernliabilitiesfromfinanceleasesduetothenewcompaniesbeingincludedinconsolidation(eur311thousand;prioryear:eur0).theseliabilitiesaredueinonetofiveyears.

thecompositionandremainingtermoftheliabilitiesasat31december2010areshowninthefollowingstatementofliabilities:

Statement of liabilities Total Remaining term

duewithin1year

duebetween1yearand

5yearsdue>5years 1)fromtaxes

2)forsocialsecurity

[EUR] [EUR] [EUR] [EUR] [EUR]

financialliabilities 206,358,359 6,567,412 122,393,611 77,397,336(2009:eur33.179m) (2009:eur25.218m) (2009:eur7.961m) (2009:eur0m)

advancepaymentsreceived 64,550,219 64,550,219

(2009:eur101.766m) (2009:eur101.766m)

tradepayables 38,743,409 38,743,409

(2009:eur35.890m) (2009:eur35.890m)

payablestoaffiliatedandassociatedcompanies 2,919,716 2,919,716

(2009:eur1.230m) (2009:eur1.230m)

otherliabilities 150,699,420 150,379,083 320,337 1)11,650,590

(2009:eur125.051m) (2009:eur125.039m) (2009:eur0.012m) (2009:eur12.298m)

2)532,420

(2009:eur2.588m)

Liabilities, total 463,271,123 263,159,839 122,713,948 77,397,336

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pensionprovisions(26)

themareklieberbergkonzertagenturgmbh&Co.kg,ticketones.p.a.,t.o.s.t.ticketonesistemiteatralis.r.l.,Ctseventimsportsgmbhsubsidiariesandthenewlyacquiredticketcorneraghavemadedirectand individualpensioncommitmentstoselectedbeneficiaries. inthe2010financialyear,benefitsamountingtoeur596thousandwerepaidoutofpensionobligationstoben-eficiaries(prioryear:eur63thousand).thecurrent2005gheubecktablesareapplicablewhenaccountingforpensionobligations.reinsurancebenefitswhichhavebeenpledgedtobeneficiaryemployeesonthebasisofpensioncommitmentsarerecognisedasplanassetsandwereoffsetagainstpensionprovisions.

31.12.2010 31.12.2009

[EUR’000] [EUR’000]

Composition of pension provisions:fairvalueofplanassets -7,250 -952presentvalueofobligations 11,667 3,668Pension provisions 4,417 2,716

The following amounts were included in the income statement:regularservicecosts 507 167interestexpenses 387 193expectedincomefromplanassets -196 -30actuariallosses/gains 252 202Total amount included in personnel expenses 950 532

Development of present value of obligations:beginningoftheyear 3,668 3,186Changesduetobusinesscombinations 6,031 0totalexpense/incomeincludedintheincomestatement 967 545Currencydifferences 1,070 0Contributionsbyplanparticipants 527 0amountspaid -596 -63End of year 11,667 3,668

The following essential actuarial assumptions were made:discountrate 3.25%-5.0% 5.3%expectedincomefromplanassets 3.4%-3.8% 4.1%futuresalaryincreases 1.25%-2.5% 2.0%-2.5%futurepensionincreases 1.0%-3.0% 1.0%-3.0%

eur11.175millionofthepresentvalueoftheobligationsarefundedcommitments(prioryear:eur3.204million).

106


Changesinplanassetsareshowninthetablebelow.planassetsarereinsurancepoliciesusedto cover pension obligations. in combinationwith the incomegenerated in past years and theassociatedexpectationsregardingfuturegains,anaverageof3.4%-3.8%istakenastheexpectedlong-termrateofreturn.theactualyieldfromplanassetsiseur17thousand(prioryear:eur13thousand).

2010 2009

[EUR’000] [EUR’000]

fairvalueofplanassets1January 952 939expectedreturnonplanassets 196 30actuariallosses/gains -179 -17Currencydifferences 917 0Changesduetobusinesscombinations 5,199 0Contributionsbytheemployer 361 0Contributionsbyplanparticipants 527 0amountspaid -723 0Fair value of plan assets 31 December 7,250 952

deferredtaXliabilities(27)

deferredtaxliabilities,ateur17.930million(prioryear:eur780thousand),resultfromtempo-rarydifferencesinthecarryingamountsstatedintheconsolidatedbalancesheetandinthefiscalbalance sheet.theeur17.150million change in deferred tax liabilities results primarily fromtemporarydifferencesarisingfromthefairvaluemeasurementofintangibleassetsinthecontextofthepurchasepriceallocationoftheticketcornergroupandtheseeticketgermany/ticketonlinegroup.

shareholders’eQuity(28)

theparentcompanyofthegroupisorganisedasapubliclimitedcompany.asabasicprinciple,theshareholdersthereforebearliabilityonlytotheamountoftheircapitalcontribution.

referenceismadetotheconsolidatedstatementofchangesinshareholders’equity.

theannualshareholders’meetingofthecompanyheldon23august2005resolvedtoincreasethesharecapitalofCtsag,previouslyamounting toeur12,000,000,byaddinganadditionaleur12,000,000 from reserves.theshare capital increasewas registeredat themunichlocalCourton6october2005,andthenewno-parvaluebearershareswerecreditedtoshareholderdepotson30october2005.asattheclosingdate,thecompanyhadthusissued24,000,000no-parvaluebearershares.eachsharerepresentsanarithmeticshareinthesharecapitalofeur1.00.

asattheclosingdate,authorisedcapitalamountedtoeur12,000,000(authorisedcapital2009).it isgranteduntil13may2014.byresolutionoftheshareholders’meetingon14may2009,themanagementboard isauthorised to increase thesharecapitalof thecompanyononeormoreoccasionsintheperiodupto13may2014,contingentonsupervisoryboardapproval,byissuing

107


newsharesagainstcashdepositsorcontributions inkind, thetotal increasenot toexceedeur12,000,000.the shareholdersmust begranted subscription rights to suchnewshares, but themanagementboardisauthorisedtoexcludesuchsubscriptionrights incertaincases,subjecttosupervisoryboardapproval.nousehasbeenmadesofarofthisauthorisation.

at theshareholders’meetingon21January2000,acontingentsharecapital increaseofeur180,000wasagreed(contingentcapital2000/1).thisincreaseshallbeeffectedonlytotheextentthatholdersofoptionsissuedunderthestockoptionplanonthebasisoftheauthorisationgrantedon21January2000exercisetheirstockoptions.thenewsharesparticipateintheprofitsofthecompany from thebeginningof the financialyear inwhich thestockoptionsareexercised.themanagementboard is authorised, subject to approval by thesupervisoryboard, to specify thefurtherdetailsofthecontingentcapitalincreaseanditsimplementation.asaconsequenceoftheshareholders’resolutionon23august2005toincreasethesharecapitaltoeur24,000,000,thiscontingentsharecapitalhasincreasedaccordinglytoeur360,000inaccordancewithsection218sentence1aktg.

theannualshareholders’meetingheldon15may2008authorised themanagementboard toissuestockoptionsandconvertiblebonds toa total valueofup toeur275millionandwithamaximumtermof20years,conditionalonsupervisoryboardapproval,by14may2013,togranttheholdersoptionandconversionrightstoupto11,000,000newno-parbearersharesinthecom-pany,equaltosharecapitalofuptoeur11,000,000,andtoexcludeshareholders,withinlegallypermittedlimits,fromsubscribingtotheconvertiblebondsundercertainconditions.inviewofthepossibleissueofsharestoholdersofoptionandconversionrightsonthebasisofthisauthorisation,thecompany’sarticlesofincorporationwereamendedsimultaneouslytocreateanadditionaleur11,000,000incontingentcapital(‘contingentcapital2008’).nousehasbeenmadesofarofthisauthorisation.

byresolutionoftheshareholders’meetingheldon12may2010,thecompanywasalsoauthor-isedunder§71(1)no.8aktgtopurchasetreasurystockamountingtoupto10%oftheregisteredsharecapitalasatthedateofresolution,by11may2015,andtousetheseforspecificpurposesasdetailed in the resolution,partiallywithexclusionof subscription rights for shareholders.thecountervaluepaidforthesesharesmaynotexceedorfallbelowthetradedpricebymorethan10%.theapplicablesharepriceisdefinedasthemeanclosingpriceforsharesontheXetratradingplatformduringthelastfivetradingdaysbeforepublicationoftheoffertopurchasetheshares.thevolumeoftheofferingmaybelimited.ifthetotalsubscriptiontothebidexceedssaidvolume,quotasshallbeallocatedinproportiontothenumberofsharesofferedineachcase.theauthorisationtorepurchaseownsharesmaybeexercisedundertheaforementionedrestrictionsinpartialamounts,ononeormoreoccasions,andtopursueoneormoreaims.

thepremium(§272(2)no.1hgb) for theshares issuedon thestockexchange isdisclosedundercapital reserve.aspartof thesharecapital increase implemented inoctober2005,eur12,000,000ofthecapitalreservewasconvertedtosharecapital,and12,000,000newno-parvaluebearershareswereissued.

108



thenon-controllinginterestcomprisesthesharesheldbythirdpartiesintheequityoftheconsoli-datedsubsidiaries.inaccordancewithias1,non-controllinginterestispresentedseparatelywithinshareholders’equity.non-controllinginterstincreasedbyeur6.485milliontoeur11.431million.thischangeresultsfromtheacquisitionandsaleofsharesincompanies(eur+6.402million)andfromproportionatesharesintheconsolidatednetincomefor2010(eur+7.400million),balancedagainstdistributionsinthe2010financialyear(eur-7.317million).

inaccordancewith ias32, theCtsgrouphasappliedsaidstandard toequity instrumentsofnon-controllingshareholdersholdingputoptions.theputoptionsheldbycertainnon-controllingshareholdersarethereforedisclosedunderfinancialliabilities.

3. additionaldisClosuresonfinanCialinstruments(ifrs7)3.1 finanCialassets

thefollowingtableshowsthestructureoffinancialassetsaccordingtoageasat31december2010:

Of which: not impaired but overdue at the balance sheet date

Carrying value 31.12.2010

Of which: neither impaired nor

overdue at the balance sheet date

Less than 30 days

Between 30 - 90 days


More than 180 days


tradereceivables 32,105 24,667 3,352 710 359 2,294receivablesfromaffiliatedandassociatedcompanies 6,979 6,699 16 0 0 265otherfinancialassets 28,912 22,124 1,921 136 96 4,707

otherfinancialassets(atfairvaluenotthroughprofitandloss) 3,014 3,014 0 0 0 0investments(atfairvaluenotthroughprofitandloss) 27 27 0 0 0 0investments(atcost) 2,008 2,008 0 0 0 0loans 534 534 0 0 0 0

73,579 59,073 5,289 846 455 7,266

109


thefollowingtableshowsthestructureoffinancialassetsaccordingtoageasat31december2009:

withregardtoreceivablesthatareneitherimpairednoroverdue,therearenoindicationsasattheclosingdatethatdebtorsarenothonouringtheirobligations.

allowancesfordoubtfulaccountsfortradereceivablesandforotherassetschangedasfollows:

theadditionnotthroughprofitandlossarosefromthetransitionoffkpscorpioanditssubsidiar-iesfromfullconsolidationtorecognitionatequity.

Of which: not impaired but overdue at the balance sheet date

Carrying value 31.12.2009

Of which: neither impaired nor

overdue at the balance sheet date

Less than 30 days



More than 180 days


tradereceivables 21,067 17,540 697 372 574 647receivablesfromaffiliatedandassociatedcompanies 4,705 2,364 179 265 283 1,614otherfinancialassets 43,865 42,320 693 163 113 478

otherfinancialassets(atfairvaluenotthroughprofitandloss) 2,016 2,016 0 0 0 0investments(atfairvaluenotthroughprofitandloss) 28 28 0 0 0 0investments(atcost) 992 992 0 0 0 0loans 435 435 0 0 0 0

73,108 65,695 1,569 800 970 2,739

2010 2009[EUR’000] [EUR’000]

allowancesfordoubtfulaccounts1January 5,794 4,314Changeinconsolidatedcompanies 21 -1additionnotthroughprofitandloss 1,248 0Consumption -1,846 -582reversal -1,706 -397addition 1,147 2,461Currencydifferences 54 -1Allowances for doubtful accounts as at 31 December 4,712 5,794

110


3.2 finanCialliabilities

thefollowingtableshowsthecontractuallyagreed(undiscounted)repaymentsandinterestpay-mentsinrespectoftheoriginalfinancialliabilities,asat31december2010:

thefollowingtableshowsthecontractuallyagreed(undiscounted)repaymentsandinterestpay-mentsinrespectoftheoriginalfinancialliabilities,asat31december2009:

theaboveincludesallinstrumentsinplaceasatthebalancesheetdateandforwhichpaymentshadalreadybeencontractuallyagreed.budgetfiguresforfutureliabilitiesarenotincluded.foreigncurrencyamountsareconvertedatthespotratesapplyingontheclosingdate.thevariableinterestpaymentsinrespectofthefinancialinstrumentswerecalculatedusingtheinterestratesfixedmostrecentlypriorto31december2010.financialliabilitiesthatarerepayableatanytimearealwaysallocatedtotheearliesttimeframe.

Carrying value

31.12.2010Redemption

< 1 yearInterest< 1 year

Redemption1 - 2 years

Interest1 - 2 years


Interest3 - 4 years

Redemption> 5 years

Interest> 5 years

[EUR’000] [EUR’000] [EUR’000] [EUR’000] [EUR’000] [EUR’000] [EUR’000] [EUR’000] [EUR’000]

financialliabilities 206,358 -6,348 -4,129 -18,460 -3,980 -107,058 -9,309 -78,147 -686tradepayables 38,743 -38,737 0 -6 0 0 0 0 0payablestoaffiliatedandassociatedcompanies 2,920 -2,882 0 -25 0 0 0 -13 0otherfinancialliabilities 121,791 -121,566 -17 -225 -11 0 0 0 0

369,812 -169,533 -4,146 -18,716 -3,991 -107,058 -9,309 -78,160 -686

Carrying value

31.12.2009Redemption

< 1 yearInterest< 1 year


Interest1 - 2 years


Interest3 - 4 years


financialliabilities 33,179 -23,490 -204 -3,051 -328 -7,344 -28tradepayables 35,890 -35,873 -1 -11 0 -6 0payablestoaffiliatedandassociatedcompanies 1,230 -1,193 0 -25 0 -12 0otherfinancialliabilities 98,425 -98,425 -19 0 0 0 0

168,724 -158,981 -224 -3,087 -328 -7,362 -28

111


3.3 additionaldisClosuresonfinanCialinstruments

Carryingvalues,recognitionandfairvaluesforthe2010financialyearareshowninthefollowingtableaccordingtorecognitioncategories:

Balance sheet value according to IAS 39

Carrying value 31.12.2010 At amortised cost

At fair value not through profit and

loss Purchase cost Fair value


AssetsCashandcashequivalents 178,036 178,036 178,036tradereceivables 32,105 32,105 31,758receivablesfromaffiliatedandassociatedcompanies 6,979 6,979 6,874otherfinancialassets 28,912 28,912 28,875

otherfinancialassets(atfairvaluenotthroughprofitandloss) 3,014 3,014 3,014investments(atfairvaluenotthroughprofitandloss) 27 27 27investments(atcost) 2,008 2,008loans 534 534 546

Liabilitiesshort-termfinancialliabilitiesandcurrentportionoflong-termfinancialliabilities 6,567 6,567 6,500medium-andlong-termfinancialliabilities 199,791 199,791 205,034tradepayables 38,743 38,743 38,160payablestoaffiliatedandassociatedcompanies 2,920 2,920 2,887otherfinancialliabilities 121,791 121,791 119,953

Categories according to IAS 39:loansandreceivables 246,566 246,566 246,089financialliabilitiesatamortisedcost 369,812 369,812 372,534available-for-salefinancialassets 5,049 3,041 2,008 3,041

112


Carryingvalues,recognitionandfairvaluesforthe2009financialyearareshowninthefollowingtableaccordingtorecognitioncategories:

Balance sheet value according to IAS 39

Carrying value 31.12.2009 At amortised cost

At fair value not through profit and

loss Purchase cost Fair value


AssetsCashandcashequivalents 229,794 229,794 229,794tradereceivables 21,067 21,067 20,810receivablesfromaffiliatedandassociatedcompanies 4,705 4,705 4,705otherfinancialassets 43,865 43,865 44,131otherfinancialassets(atfairvaluenotthroughprofitandloss) 2,016 2,016 2,016investments(atfairvaluenotthroughprofitandloss) 28 28 28investments(atcost) 992 992loans 435 435 492

Liabilitiesshort-termfinancialliabilitiesandcurrentportionoflong-termfinancialliabilities 25,218 25,218 25,286medium-andlong-termfinancialliabilities 7,961 7,961 7,822tradepayables 35,890 35,890 35,441payablestoaffiliatedandassociatedcompanies 1,230 1,230 1,215otherfinancialliabilities 98,425 98,425 97,195

Categories according to IAS 39:loansandreceivables 299,866 299,866 299,932financialliabilitiesatamortisedcost 168,724 168,724 166,959available-for-salefinancialassets 3,036 2,044 992 2,044

113


the fair valueof a financial instrument is definedas theamount forwhichanasset could beexchanged,oraliabilitysettled,betweenknowledgeable,willingpartiesinanarm’slengthtransac-tion.

iffinancialinstrumentsarelistedonanactivemarket,likefundshares,inparticular,therespectivelistedpriceonthatmarketsignifiesthefairvalue.inthecaseofunlistedfinancinginstruments,thefairvalueiscalculatedasthepresentvalueofthefuturecashflows,takinginterestratecurvesandtherating-dependentcreditriskpremiumoftheCtsgroupintoaccount.

forcashandcashequivalents,currenttradereceivables,receivablesfromaffiliatedandassoci-ated companies, other financial assets, financial liabilities, payables to affiliatedandassociatedcompaniesandotherfinancialliabilities,thecarryingvaluesaresubstantiallyequaltothefairvalues,duetotheirshortremainingterm.

thefairvaluesofnon-currenttradereceivables,receivablesfromaffiliatedandassociatedcom-panies,otherfinancialassets,financialliabilities,payablestoaffiliatedandassociatedcompaniesandotherfinancial liabilitiesareequaltothepresentvalueofthecashflowsassociatedwiththefinancinginstruments.

duetotheabsenceofanactivemarket,thefairvaluesforsharesandinvestmentsinothercom-paniescannotbemeasuredreliably.thesefinancialinvestmentsaremeasuredatcost.

ofthetotalavailable-for-salefinancialassets,eur3.041millionareaccountedforatfairvaluebutnotthroughprofitandloss,andeur2.008millionareaccountedforatcost.sincethefairvalues(eur3.041million)correspondtoobservablemarketprices,theyqualifyaslevel-onefairvaluesintheifrs7fairvaluehierarchy.

theavailable-for-salefinancialassetsdevelopedasfollows:

2010 2009[EUR’000] [EUR’000]

available-for-salefinancialassetsasat1January 3,036 1,156Changeinthescopeofconsolidation 1,010 0addition 1,041 1,978disposal -40 -150accumulatedothercomprehensiveincome 2 52Available-for-sale financial assets as at 31 December 5,049 3,036

114


netprofit/lossfromfinanCialinstruments

2010 2009[EUR’000] [EUR’000]

loansandreceivables 1,978 -37available-for-salefinancialasstes 3 60financialliabilities -2,170 -1,632

-189 -1,609

thenetgains / losses in the recognitioncategories loansand receivablesand financial liabili-tiesmainlycompriseinterestincome/expenseandimpairmentsofreceivables.thetotalinterestexpensecalculatedusingtheeffectiveinterestmethodiseur252thousand.gainsandlossesofavailable-for-salefinancialassetsare,interalia,statedinshareholdersʼequity.

finanCialrisks

disclosuresregardingtherisksensuingfromfinancialinstrumentsarepresentedinitem8ofthemanagementreport,inaccordancewithifrs7.b6.

4. notestotheConsolidatedinComestatement

revenue(1)

grouprevenuewasincreasedyear-on-yearby11%,oreur52.879million,fromeur466.698million toeur519.577million.revenue(beforeconsolidationbetweensegments)breaksdownintoeur193.871million in theticketing segment (prior year:eur152.493million) andeur333.807millionintheliveentertainmentsegment(prioryear:eur318.726million).

Costofsales(2)

expendituresarestatedintheincomestatementaccordingtofunction.theincomestatementsofthesubsidiariesarefirstlypreparedusingthetypeofexpendituremethod,withcoststhenbeingreassignedtothefunctionalexpensesofthecostofsalesmethodusingconversioncodesfortherespectivecostelements,forintegrationinthegroupfinancialstatementsaccordingtoifrs.Costelementsareassignedeitherto100%oronthebasisofworkforcenumberandpersonnelexpenses.usingthisconversioncode,materialexpenses,personnelexpenses,depreciationandamortisationandother operatingexpensesof the individual companiesaccording to the cost of expendituremethodareassignedtocostofsales,sellingexpenses,generaladministrativeexpensesandotheroperatingexpenses.

115


Material expenses (according to type of expenditure method) 2010 2009 Change

[EUR’000] [EUR’000] [EUR’000]

Costofmaterials,suppliesandpurchasedmerchandise 21,387 20,827 560Costofpurchasedservices 312,965 296,177 16,788

334,352 317,004 17,348

Costofsalescomprisesallmaterialexpensesaswellasproportionalpersonnelexpenses,depre-ciationandamortisationandotheroperatingexpenses.

inthefollowing,materialexpenses,personnelexpenses,depreciationandamortisationandotheroperatingexpensesarepresentedusingthetypeofexpendituremethod.

materialexpensesusingthetypeofexpendituremethodareallocatedinfulltocostofsalesusingthecostofsalesmethod.

dueto thebroaderscopeofconsolidation,materialexpensesaccordingto typeofexpendituremethodincreasedbyeur6.179million.

personnelexpensesusingthetypeofexpendituremethodareallocatedonapercentagebasistocostofsales,sellingexpensesandgeneraladministrativeexpensesusingthecostofsalesmethod.of total personnel expenses,eur24.052millionwere recognisedas cost of sales (prior year:eur17.140million),eur20.788millionassellingexpenses(prioryear:eur16.571million)andeur16.836millionasgeneraladministrativeexpenses(prioryear:eur11.278million).personnelexpensesrelatingtonon-recurringitemswererecognisedinfullasotheroperatingexpenses(eur2.730million).

employercontributionstopensioninsurancewere9.95%inthe2010financialyear.socialinsur-ancecontributionsandexpensesforpensionandemployeesupportincludeeur2.453millionincontributiontostatutorypensioninsurance(prioryear:eur1.754million).statutorypensioninsur-anceisadefinedcontributionplan.

duetothebroaderscopeofconsolidation,personnelexpensesaccordingtotypeofexpendituremethodincreasedbyeur17.540million.

Personnel expenses (according to type of expenditure method) 2010 2009 Change

[EUR’000] [EUR’000] [EUR’000]

wagesandsalaries 54,632 37,711 16,921socialinsurancecontributionsandexpensesforpensionandemployeesupport 9,774 7,278 2,496

64,406 44,989 19,417

116


otheroperatingexpensesusingthetypeofexpendituremethodareallocatedonapercentagebasis to cost of sales, selling expenses, general administrative expenses and other operatingexpensesusingthecostofsalesmethod.oftheotheroperatingexpenses,eur8.079millionwererecognisedascostofsales(prioryear:eur5.584million),eur16.983millionassellingexpenses(prioryear:eur13.786million)andeur7.090millionasgeneraladministrativeexpenses(prioryear:eur5.904million).theremainingeur13.817million(prioryear:eur7.832million)isallo-catedtootheroperatingexpenses.

duetothebroaderscopeofconsolidation,otheroperatingexpensesaccordingtotypeofexpendi-turemethodincreasedbyeur8.319million.

sellingeXpenses(3)

sellingexpensesincludeexpendituresforsales,advertisingandmarketing.theeur9.634mil-lionincreaseinsellingexpensesismainlyduetohigherpersonnelexpenses(eur+4.217million),depreciationandamortisation(eur+2.219million,ofwhicheur1.788millionareamortisationfrompurchasepriceallocation)andadvertisingexpenses(eur+3.214million).themaindriverbehindtheincreaseinsellingexpenseswasthegreaternumberofcompaniesincludedinconsolidation.

generaladministrativeeXpenses(4)

theeur9.655million increase in general administrative expenses ismainly attributable toincreasedpersonnelexpenses(eur+5.558million),depreciationandamortisation(eur+2.915

depreciationandamortisationusingthetypeofexpendituremethodareallocatedonapercentagebasistocostofsales,sellingexpensesandgeneraladministrativeexpensesusingthecostofsalesmethod.eur6.182millionindepreciationandamortisationwerefactoredintocostofsales(prioryear:eur2.571million),eur6.273millionintosellingexpenses(prioryear:eur4.054million)andeur4.984millionintogeneraladministrativeexpenses(prioryear:2.069million).depreciationandamortisationofinvestmentsinprioryearamountedtoeur348thousandandwereincludedinthefinancialresult.

due to thebroader scopeof consolidation, depreciationandamortisationaccording to typeofexpendituremethodincreasedbyeur8.888million.ofthattotal,eur7.278millionwereforamor-tisationfrompurchasepriceallocation.

Depreciation and amortisation (according to type of expenditure method) 2010 2009 Change

[EUR’000] [EUR’000] [EUR’000]

depreciationandamortisationonproperty,plantandequipmentandintangibleassets 17,439 8,694 8,74517,439 8,694 8,745

Other operating expenses (according to type of expenditure method) 2010 2009 Change

[EUR’000] [EUR’000] [EUR’000]

otheroperatingexpenses 45,969 33,106 12,86345,969 33,106 12,863

117


otheroperatingincomeincludes,interalia,incomefromcommission,ticketinsurances,collectionfeesandrefunds.

otheroperatingeXpenses(6)

otheroperatingexpensescomprisethefollowingitems:

*adescriptionofthenon-recurringitemsisprovidedinthemanagementreport,page31

2010 2009 Change

[EUR’000] [EUR’000] [EUR’000]

incomefrommarketingandmagazine 3,013 2,111 902incomefromthereversalofallowancesfordoubtfulaccounts 1,706 397 1,309incomefromcurrencytranslation 1,646 350 1,296incomefromwritten-offliabilities/written-offreceivables 1,166 277 889incomefrompassedonexpenses 731 671 60incomerelatingtootherperiods 544 309 235totalincomeresultingfromthetransitionfromfullconsolidationtorecognitionatequity 428 0 428paymentsofdamages 374 466 -92incomefrominsurancecompensation 311 775 -464incomefromthereversalofprovisions 217 59 158otheroperatingincome 3,020 2,922 98

13,156 8,337 4,819

2010 2009 Change

[EUR’000] [EUR’000] [EUR’000]

non-recurringitems* 7,821 0 7,821expensesforthird-partyservices 2,489 2,040 449expensespassedontothirdparties 1,157 774 383Currencytranslationexpenses 730 587 143leases/rent 472 509 -37maintenanceexpenses 345 282 63expensesrelatingtootherperiods/non-operatingcosts 341 467 -126donations 272 216 56Costforthesupplyofgoodssold 132 95 37lossfromdisposaloffixedassets 112 84 28otheroperatingexpenses 2,676 2,778 -102

16,547 7,832 8,715

million,ofwhicheur2.319million isamortisation frompurchasepriceallocation)andcosts forofficepremisesand rent (eur+546 thousand).themaindriverbehind the increase ingeneraladministrativeexpenseswasthegreaternumberofcompaniesincludedinconsolidation.

otheroperatinginCome(5)

otheroperatingincomecomprisesthefollowingitems:

118


otheroperatingexpensesinclude,interalia,postallosses,uncancellableticketsandemolumentsforthesupervisoryboard.

inCome/eXpensesfrompartiCipations(7)

income fromparticipations,ateur34 thousand, relates toan investmentbyargokonzertegmbh,würzburg(prioryear:eur8thousand).

inCome/eXpensesfrominvestmentsinassoCiates(8)

oftheincome/expensesfrominvestmentsinassociates,eur20thousandwasattributabletogreenfieldfestivalag,hünenberg(prioryear:eur91thousand),eur6thousandtogreensavegmbh,würzburg(prioryear:eur49thousand)andeur-77thousandtofkpscorpioand itssubsidiaries(prioryear:eur0).

finanCialinCome(9)

financialincomecompriseseur2.356millionininterest(prioryear:eur1.995million)andeur116thousand(prioryear:eur21thousand)inotherfinancialincome.taxrefundinterestaccountedformostoftheincreaseinfinancialincome.

finanCialeXpenses(10)

theincreaseinthepresentvalueofpurchasepriceobligationsinrespectofputoptions,ateur94thousand(prioryear:eur1.017million),werestatedasfinancialexpensesinaccordancewithias32.

apartfromthelatter,financialexpensesmainlycompriseinterestexpenseofeur2.691million(prioryear:eur313thousand),whichpredominantlyresultedfromexternalborrowingtofinancetheacquisitionsmadeduringthecurrentfinancialyear.

taXes(11)

thetotaldisclosedtaxexpensesarecomprisedasfollows:

2010 2009 Change

[EUR’000] [EUR’000] [EUR’000]

incometaxes 22,991 22,748 243deferredtaxes -3,309 559 -3,868

19,682 23,307 -3,625

119


Currenttaxexpensesaremeasuredbyapplyingthetaxationrulesoftherespectivecountriesinwhichthesubsidiariesoperateandgeneratetaxableincome,asapplicableonthebalancesheetdateorwhichwillbeapplicableinthenearfuture.

Current taxexpenses includeactual taxexpenses forotherperiods,ateur87 thousand,anddeferredtaxincomeforotherperiods,ateur77thousand.

deferredtaxincome/expenses(net)resultsfromthecreationand/orreversaloftemporarydif-ferencesbetween ifrscarrying valuesand fiscal carrying values, and from the formation andconsumptionofdeferredtaxesforfiscallosscarryforwards.

deferredtaxincome/expensesdevelopedasfollows:

deferredtaxassetsofeur1.540millionanddeferredtaxliabilitiesofeur20.439millionwererecognised,notthroughprofitandloss,inrespectofpurchasepriceallocationsrelatingtotheacqui-sitionsmadeduringthereportingyear.

thefollowingtableshowsthereconciliationofthetaxexpensesexpectedintherespectivefinan-cialyearwiththetaxexpensesasactuallydisclosed.todeterminetheexpectedtaxexpensesfor2010,anaveragetaxrateof31%(prioryear:31%)wasmultipliedbythepre-taxprofit.

2010 2009 Change

[EUR’000] [EUR’000] [EUR’000]

deferredtaxes -3,309 559 -3,868ofwhich:

fromtemporarydifferences -2,619 -191 -2,428fromtaxlosscarryforwards -690 750 -1,440

2010 2009

[EUR’000] [EUR’000]

profitbeforetax(ebt) 68,853 71,496

Reconciliation to effective tax expenses

Expected income taxes 21,344 22,164deviationduetobasisofcalculationformunicipaltradetax 28 -138deviationsfromexpectedtaxrate -790 -563Changesinvalueadjustmentofdeferredtaxassets/liabilties 5 0losseswithouttheformationofdeferredtaxassets -89 863non-taxableincomeandnon-deductibleexpenses -350 627othertaxeffects -466 354Income taxes according to income statement 19,682 23,307

120


non-Controllinginterest(12)

according to ias32,non-controlling interestneednotbe recognised incompanieswithcorre-spondingputoptions.

thenon-controllinginterestinthenetincomefor2010iseur7.400million(prioryear:eur8.246million).thereductionismainlyduetolessnon-controllinginterestintheliveentertainmentseg-ment.

5. notestotheCashflowstatement

CashflowfromoperatingaCtivities(1)

Cash flow fromoperatingactivitiesdecreased year-on-year byeur -43.535million fromeur55.052milliontoeur11.517million.theyear-on-yearchange incashflowwasmainlyduetoalowerperiod-on-periodincreaseinliabilities(eur-74.807million),toincreasedpaymentsonincometaxes(eur-9.177million)andtochangesinothernon-cashexpenses/income(eur-6.476mil-lion).thesewereoffsetbypositivecashfloweffectsresultingfromchangesinreceivablesandotherassets(eur+41.488million)andfromanincreasedoperatingcashflow(eur+4.549million).

thenegativecashfloweffectofeur-74.807millionfromchanges in liabilitieswasmainlytheresultofadvancepaymentsreceivedintheliveentertainmentsegment(eur-48.963million)andofliabilitiesaccruingintheticketingsegmentfromticketingmoniesthathavenotyetbeeninvoiced(eur-20.346million).thechanges(reduction)inadvancepaymentsreceivedisattributabletoanincreasedvolumeofticketmoniesbeingreceivedinthefourthquarter2009frompre-salesformajortours in2010(includingu2 ingermanyandaC/dC inaustria),whereas in thecurrent reportingyeartherewerenopre-salesofsimilardimensionsformajortoursin2011.forthesamereason,theliabilitiesforticketmoniesthathavenotyetbeeninvoiceddecreasedaccordinglyyear-on-year(includingaC/dCgermany).

theeur9.177millionincreaseinincometaxespaidismainlyattributabletohigherprepaymentsfor the2010 financial year, to retrospective taxpayments for the2009 financial yearand to thegreaternumberofcompaniesincludedinconsolidation.

incomparisontothepreviousyear,theeur-6.476millionchangeinothernon-cashexpenses/incomespecificallyincludeslowerexpensesfromthecompoundingofliabilitiesinrespectofputoptionagreements(ias32)aswellas lowerexpensesfromadditionstoallowancesfordoubtfulaccounts.inaddition,increasedamountsofnon-cashexpenses/incomearoseinthereportingyearfromthereversalofallowancesfordoubtfulaccounts.

thepositivecashfloweffectofeur+41.488millionderivingfromyear-on-yearchangesinreceiv-ablesandotherassetsismainlyattributabletothefactthat,asatthe31december2009reportingdate,therewasahighervolumeofreceivablesfromticketpre-saleswhichweresettledinthecur-rent2010financialyear(eur+20.111million).receivablesfromticketmoniesincludecurrentticketmoneyreceivables,interaliaduefromcreditcardanddirectdebitpayments.apositiveinfluenceoncashflowwasalsoexertedduringthereportingperiodbythechangeinreceivablesfornewtypesofeventandbythechangeinreceivablesinrespectofsecuritydeposits.

121


CashflowfrominvestingaCtivities(2)

Cashoutflowforinvestingactivitiesrosebyeur118.992milliontoeur133.963million.invest-mentsinthereportingyearmainlyincludedthepaymentfortheacquisitionofsharesinseeticketgermany/ticketonlinegroup(eur133.209millionbalancedagainsteur7.777millionincashandcashequivalentstakenover),investmentsinintangibleassets(eur9.487million),interaliaforsoftwaredevelopmentservicesandcustomerbase,aswellasinvestmentsinproperty,plantandequipment(eur6.176million).

theeur7.205millionnet increase/decreaseincashandcashequivalentsduetochangeinscopeofconsolidationincludescashandcashequivalentstakenoverfromtheacquisitionoftheticketcornergroup.

CashflowfromfinanCingaCtivities(3)

Cashflowfromfinancingactivitiesincreasedyear-on-yearbyeur93.120milliontoeur+69.761million,mainlydue tohigher levelsofexternalborrowing (eur+186.425million) to finance theacquisitionsmadeduringthecurrentfinancialyear,andtoproceedsreceivedfromthechangeinsharesinsubsidiaries(eur+5.419million).thesewereoffsetbycashoutflowfortheredemptionof financial liabilities takenover from the former shareholders in the context of theticketcornergroupandseeticketgermany/ticketonlinegroupacquisitions(eur-55.693million)andfortheacquisitionofadditionalsharesinsubsidiariesalreadyincludedinconsolidation(eur-32.433million).anincreaseinbankloanrepayment(eur-4.785million)aswellasincreaseddistributionstoshareholders(eur-5.280million)alsoproducedanegativecashfloweffect.

7. earningspershare

earningspersharewerecalculatedaccordingtoias33bydividingtheconsolidatednetincomeafternon-controllinginterestbythenumberofsharesoutstanding(basicearningspershare).asatthebalancesheetdate,thereisnodilutionasaresultofconvertiblebonds,stockoptionsorsimilarinstruments(potentialcommonstock).

theearningspersharearedeterminedasfollows:

8. segmentreporting

thegroupoperates intheleisureeventsmarketwith itsticketingandliveentertainmentdivi-sions.Ctsag,theparentcompanyofthegroup,operatesinthefieldofticketingandistheonecompanythatsetsthepaceinthisparticularsegment.statementsmadeinrespectoftheticketingsegmentapplyalsoandespeciallytoCtsag.sellingticketsforleisureeventsisthebasicobjectoftheticketingsegment,whichmarketsevents(tickets)usingitsmarket-leadingnetworkplatform(eventim.net),thein-houseticketingproduct(eventim.inhouse),thesportticketingproduct(eventim.

31.12.2010 31.12.2009

[EUR] [EUR]

netincomeafternon-controllinginterest 41,770,740 39,943,443Quantityofshares 24,000,000 24,000,000Earnings per share 1.74 1.66

122


tixx)andasolutionforticketsalesandadmissioncontrolinstadiumsandarenas.thebasicobjectoftheliveentertainmentdivisionistoorganiseandexecuteevents.

thegroupissegmentedonthebasisoftheinternalreportstothechiefoperatingdecisionmaker(themanagementboard)andincludesthecomponentsrequiredbyias8.thechiefoperatingdeci-sionmakerisresponsiblefordecisionsontheallocationofresourcestotheoperatingsegmentsandforassessingtheirperformance.

transferpricesforintercompanyservicesaredeterminedinaccordancewithnormalmarketcondi-tions.

notestothesegments

asattheendof2010,thecompaniesoperatinginthesegmentswereasfollows:

tiCketing

•Ctsag •ticketexpressgesellschaft zurherstellung und zumvertrieb elektronischereintrittskartenmbh •Öts,gesellschaft zumvertrieb elektronischereintrittskartenmbh •Ö-ticketnordwestgmbh•Ö-ticket-südost,gesellschaftzurherstellungundzumvertriebelektronischereintrittskartenmbh •Ö-ticket-nordosteintrittskartenvertriebgmbh •ticketexpresshungarykft. •teXhungarykft. •gsogesellschaft fürsoftwareentwicklungundorganisationmbh&Co.kg•Ctseventimsolutionsgmbh•Ctseventimsportsgmbh•Ctseventimnederlandb.v.•Ctseventimschweizag•Ctseventimruo.o.o.•ticketones.p.a.•t.o.s.t.,ticketonesistemiteatralis.r.l.•t.o.s.C.–ticketonesistemiCulturalis.r.l•tsCeventimticket&tourist-service-Centergmbh•Ctseventimswedenab•lippupisteoy•eventimuklimited•eventimCZs.r.o.•tempodomegmbh•eventimsp.z.o.o•s.C.eventim.ros.r.l.•ticketcornerag•ticketcornergmbh•seeticketsgermanygmbh•ticketonlinesales&serviceCentergmbh•ticketonlinesoftwaregmbh•ticketonlinepolskaspolkaz.o.o.

liveentertainment

•mareklieberbergkonzertagenturgmbh&Co.kg•peterriegerkonzertagenturgmbh&Co.kg •semmelconcertsveranstaltungsservicegmbh •argokonzertegmbh •dirkbeckerentertainmentgmbh • lskonzertagenturgmbh •pgmpromotersgroupmunichkonzertagenturgmbh•actentertainmentag•show-factoryentertainmentgmbh

thesegment-relateddataweredeterminedinthefollowingway:

internal revenuesbetween thegroup companies in a given segment havealreadybeen con-solidatedatsegmentlevel.theassetswereallocatedtothesegmentsinthecourseofconsolida-tion.revenuebetweenthesegmentswaseliminatedintheconsolidationcolumn.serviceswereinvoicedatthenormalmarketpriceschargedtothirdparties.dependingontheirbusinesscontent,individual transactions are allocated to their proper segment, in deviation from their allocationaccordingtocorporatestructure.

123


theinternalandexternalrevenueofthesegmentsisshowninthefollowingtable:

thegroupisdividedintotheaforementionedtwosegments,whichgeneratedthefollowingfiguresafterconsolidation:

Ticketing Live Entertainment Total for segment

2010 2009 2010 2009 2010 2009


externalrevenue 189,118 149,703 330,459 316,995 519,577 466,698internalrevenue 26,563 18,378 73,397 67,814 99,960 86,192Total revenue 215,681 168,081 403,856 384,809 619,537 552,890Consolidationwithinsegment -21,810 -15,588 -70,049 -66,083 -91,859 -81,671Revenue after consolidation within segment

193,871 152,493 333,807 318,726 527,678 471,219

Ticketing Live Entertainment Intersegment consolidation Group

2010 2009 2010 2009 2010 2009 2010 2009

[EUR’000] [EUR’000] [EUR’000] [EUR’000] [EUR’000] [EUR’000] [EUR’000] [EUR’000]

revenue 193,871 152,493 333,807 318,726 -8,101 -4,521 519,577 466,698ebitda 61,436 55,435 26,560 24,519 0 20 87,996 79,974ebit 46,001 49,041 24,556 22,219 0 20 70,556 71,280depreciationandamortisation

-15,435 -6,394 -2,004 -2,300 0 0 -17,439 -8,694

financialresult -1,703 216earningsbeforetax(ebt)

68,853 71,496

taxes -19,682 -23,307netincomebeforenon-con-trollinginterest

49,171 48,189

non-controllinginterest

-7,400 -8,246

netincomeafternon-controllinginterest

41,771 39,943

averagenumberofemployees 1,279 662 326 352

1,605 1,014

normalisedebitda 69,257 55,435 26,560 24,519 0 20 95,817 79,974normalisedebitbeforeamor-tisationfrompurchasepriceallocation 61,100 49,041 24,556 22,219 0 20 85,655 71,280

124


thegroupinvestedatotalofeur241.646millionintheticketingsegment,ofwhicheur229.139millionwasrecognisedasadditionsarisingfromchangesinthescopeofconsolidation.investmentsinproperty,plantandequipment,ateur6.824million(ofwhicheur3.576millionwasrecognisedasadditionsarisingfromchangesinthescopeofconsolidation)mainlyrelatetohardwarefornewitinfrastructure(includingserversfordatacentresandequipmentforticketoffices/promotersandhardwareforadmissioncontrol instadiums),andtooperatingandofficeequipment.investmentsinintangibleassets(includinggoodwill)amountedtoeur233.726millionand,inadditiontoeur5.317millionincapitaliseddevelopmentcosts,mainlycompriseintangibleassetswhichwerecapi-talisedinthepurchasepriceallocationofthecompaniesnewlyacquiredinthereportingyear,suchascustomerbase(eur58.210million),software(eur10.752million,primarilyticketingsoftware)andtrademark(eur3.926million),aswellasgoodwillensuingtherefrom(eur151.580million).additionstoinvestmentsamounttoeur1.096millionandincludemainlyoneparticipation(eur992thousand)whosesharesareheldbythenewly-acquiredticketcornergroup.amortisationofintangibleassetsamountedtoeur12.520million(prioryear:eur4.444million),anddepreciationofproperty,plantandequipmenttoeur2.915million(prioryear:eur1.950million).

intheliveentertainmentsegment,thegroupinvestedatotalofeur3.281million(withouttakingintoaccountanyadditionsarisingfromchangesinthescopeofconsolidation).eur2.928millionwereinvestedinproperty,plantandequipmentandeur229thousandinintangibleassets.theinvestmentsinproperty,plantandequipmentmainlyrelatetoexhibitioninventoryfor‘edutainment’events.theadditionstoinvestments,ateur124thousand(withouttakingintoaccountanyaddi-tionsarisingfromchangesinthescopeofconsolidation),relateprimarilytoloans(eur91thou-sand).boththeadditionsandthedisposalsfromthechangeinscopeofconsolidationresultfromthe transition from fullconsolidationoffkpscorpioand itssubsidiaries to recognitionatequity.amortisationofintangibleassetsamountedtoeur185thousand(prioryear:eur515thousand),anddepreciationofproperty,plantandequipmenttoeur1.819million(prioryear:eur1.785mil-lion).

thetotalinvestmentsintheticketingandliveentertainmentsegmentsareshownunderthesec-tion‘notestotheconsolidatedbalancesheet’.

theassetsandliabilitiesthatcanbedirectlyallocatedtoaspecificsegmentmustbedisclosedaccordingly.segmentassetsaretheoperatingassetsthatareusedbyasegmenttoperformitsoperatingactivitiesandwhichcanbeeitherdirectlyattributedtothesegmentorwhichareallocatedto thesegmentona reasonablebasis. income tax refundclaimsdonot formpartof segments’assets.segmentliabilitiesaretheoperatingliabilitiesthatresultforasegmentfromitsoperatingactivitiesandwhichcanbeeitherdirectlyattributedtothesegmentorallocatedtothesegmentonareasonablebasis.segmentliabilitiesdonotincludeincometaxliabilities,pensionprovisionsornon-controllinginterest.otheritemscompriseallassetsandliabilitieswhicharenotallocatedtotheassetsorliabilitiesofthesegments.

125


Ticketing Live Entertainment Other itemsIntersegment consolidation Group

2010 2009 2010 2009 2010 2009 2010 2009 2010 2009

[EUR’000] [EUR’000] [EUR’000] [EUR’000] [EUR’000] [EUR’000] [EUR’000] [EUR’000] [EUR’000] [EUR’000]

fixedassets 342,223 105,476 38,530 40,217 0 0 -15,178 -15,182 365,575 130,511otherassets 187,928 201,091 104,628 147,216 10,515 8,805 -12,176 -25,739 290,895 331,373liabilities 385,070 176,784 114,087 149,461 12,545 12,676 -13,339 -26,901 498,363 312,020

theassetsandliabilitiesasattheclosingdateareasfollows:

theliabilitiesoftheliveentertainmentsegmentincludeeur64.550millioninadvancepaymentsreceived(prioryear:eur101.766million)thatarepostedasrevenueaftertherespectiveeventshavetakenplaceandaccountshavebeensettled.

geographiCaldisClosures

thefollowingtableshowstheexternal revenueforthe2010financialyear,brokendownbygeo-graphicaldistribution:

2010 2009

[EUR’000] [EUR’000]

germany 394,756 364,541austria 53,504 47,691switzerland 27,624 10,381italy 20,141 20,335othercountries 23,552 23,750

519,577 466,698

126


thecarryingvaluesofnon-current, non-financial assetsforthe2010financialyearareshowninthefollowingtableaccordingtogeographicaldistribution:

thecarryingvaluesofdeferred tax assetsforthe2010financialyearareshowninthefollowingtableaccordingtogeographicaldistribution:

9. employees

onaverageovertheyear,1,605salariedstaff(prioryear:1,014)wereemployedbythegroup.ofthattotal,1,059(prioryear:576)wereemployedingermany,and546(prioryear:438)inforeigncountries.

10. finanCialobligations

therentalandleasingagreementsareallocatedtothe‘operatinglease’categoryinaccordancewithias17.therentalobligationsrelatetorentalpaymentsforofficepremises,andthe leasingobligationspertainprimarilytovehicles.

2010 2009

[EUR’000] [EUR’000]

germany 276,949 117,972austria 1,078 1,191switzerland 74,637 510italy 6,830 5,294othercountries 3,513 4,078

363,007 129,045

2010 2009

[EUR’000] [EUR’000]

germany 286 869austria 686 9switzerland 536 65italy 846 389othercountries 10 28

2,364 1,360

127


therental,leasingandotherobligationsareshowninthefollowingtable:

asattheclosingdate,contingentliabilitiesamountingtoeur425thousandexistinrespectofabankguaranteeprovidedonbehalfofasubsidiarytosafeguardcontractualobligationsunderapro-ductionagreement.itisnotexpectedthatthisguaranteewillbeexercised,sincethebankguaranteeisalreadyoffsetbyticketmoniesreceived.

therearenoothercontingentliabilities.

11. leasing

othershort-termfinancialliabilitiesincludeliabilitiesfromfinanceleases,ateur178thousand,andotherlong-termfinancialliabilitiesincludeliabilitiesfromfinanceleaseswitharemainingtermofuptofouryears,ateur311thousand.theinterestratesonwhichtheleasingagreementsarebasedvarybetween3%and6%,dependingonthemarketratesandthedateofconclusion.themainleasesrelatetoserversandvehiclesthatareaccountedforinthenewlyacquiredcompanies.

12. eventsafterthebalanCesheetdate

sincethebalancesheetdate,therehavebeennoeventsthatrequiredisclosure.

13. pendingCourtproCeedings

thegroup is involved inpendingproceedingsand litigationasarises in thenormal courseofbusiness.intheviewofthecompany’slegalrepresentatives,therewillbenomaterial impactonthefinancialpositionandfinancialperformanceofthegroupwhenthesemattersarebroughttoanend.provisionsamountingtoeur174thousandwereformedasatthebalancesheetdatetocoverlitigationexpenses.

inapril2010,Ctsagfiledforarbitrationagainstlivenationinc.andlivenationworldwideinc.attheinternationalChamberofCommerce(iCC),inwhichlivenationissuedforvariousbreachesofcontract,withapleathatthelattertobeorderedtofulfilthepartnershipagreementconcludedindecember2007andtopaydamages.inJune2010,livenationgavenoticethatitwasterminat-

31.12.2010 31.12.2009

< 1 year 1 - 5 years > 5 years < 1 year 1 - 5 years > 5 years


rentalobligations 5,516 10,682 1,567 3,560 9,274 1,922

leasingobligations 527 659 0 464 636 0otherobligations 1,059 411 0 624 409 129

7,102 11,752 1,567 4,648 10,319 2,051

128


ingtheagreementonthegroundsofallegedbreachesbyCtsag.Ctsagrejectedthenoticeofterminationbylivenationandannouncedadditionalclaimstodamagesintheorderofmillions.adecisiononthearbitrationrequestisexpectedbytheendof2011.

14. deClarationofComplianCe

on9december2010,themanagementboardandthesupervisoryboardofCtsagreleaseda further declarationof compliancewith the recommendationsof the ‘governmentCommissiononthegermanCorporategovernanceCode’pursuantto§161aktg,andmadesaiddeclarationpermanentlyavailabletoshareholdersontheCtsagwebsite(http://www.eventim.de/tickets.html?affiliate=eve&fun=tdoc&doc=eventim/default/info/en/investor/investorCorporategovernance/cor-respondingdeclaration/2010).

15. appliCationofseCtion264(3)hgbandseCtion264bhgb

somecorporateenterprisesandbusinesspartnershipswithinthemeaningofsection264ahgbthatareaffiliatedandconsolidatedsubsidiariesofCtsag,andforwhichtheconsolidatedfinancialstatementsofCtsaghavetheeffectofdischargingobligationstoprepareanddisclosefinancialstatements,makeuseoftheexemptionoptionprovidedbysection264(3)hgbandsection264bhgb:

•Ctseventimsolutionsgmbh,bremen

•gsogesellschaftforsoftwareentwicklungandorganisationmbh&Co.kg,bremen

•mareklieberbergkonzertagenturgmbh&Co.kg,frankfurt/main

•peterriegerkonzertagenturgmbh&Co.kg,Cologne

16. notifiableseCuritiestransaCtionspursuanttoseCtion15aseCuritiestradingaCt(wphg)

inthe2010businessyear,executiveofficersofCtsagconductedthefollowingnotifiablesecuri-tiestransactionsinsharesofthecompany,andnotifiedthecompanythereof:

Name Position Transaction Trading day Number of units

edmundhug supervisoryboard sale 08.12.2010 1,000prof.Jobstw.plog supervisoryboard purchase 02.07.2010 650

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17. relatedpartydisClosures

according to ias24,companiesorpersons thatexercisecontrolover,orarecontrolledby thegroupmustbedisclosediftheyhavenotalreadybeenincludedasconsolidatedcompaniesintheconsolidatedfinancialstatementsofthegroup.

thetransactionsoftheCtsgroupwithrelatedpartiespertaintoreciprocalservicesandwerecon-cludedonlyatthearm’s-lengthconditionswhichnormallyapplybetweenthirdparties.themajorityshareholderofCtsagisacontrollingshareholderofothercompaniesassociatedwiththegroup.

the contractual relationshipswith relatedparties resulted in the followinggoodsand servicesbeingsoldtoandboughtfromrelatedpartiesinthe2010reportingperiod:

eur480thousandingoodsandservicesweresuppliedbythegrouptosubsidiariesnotincludedinconsolidationduetoinsignificance(prioryear:eur780thousand),eur1.895milliontoassoci-atedcompanies(prioryear:eur266thousand)andeur6.622milliontootherrelatedparties(prioryear:eur6.777million).

2010 2009

[EUR’000] [EUR’000]

Goods and services supplied by the Groupservicesinconnectionwithtours 7,419 6,565supplyofticketingsoftware 449 251allocationofoperatingcosts 659 954other 470 53

8,997 7,823

2010 2009

[EUR’000] [EUR’000]

Goods and services received by the Groupfulfilmentservices 9,109 8,675tenancyagreements 686 682Callcentreoperations 2,510 3,387businessservicesagreements 661 1,232productioncostsforevents 1,327 912other 2,129 747

16,422 15,635

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eur217 thousand in goods and serviceswere received by thegroup from subsidiaries notincludedinconsolidationduetoinsignificance(prioryear:eur691thousand),whileeur1.022mil-lioningoodsandservicesweresuppliedbyassociatedcompanies(prioryear:eur201thousand)andeur15.183millionweresuppliedbyotherrelatedparties(prioryear:eur14.743million).

asfrom1July2010,thetransactionsbetweentheCtsgroupandfkpscorpioanditssubsidiar-iesmustbedisclosedasrelationshipswithassociatedcompanies,duetothedeconsolidationoffkpscorpioanditssubsidiaries.

Compensationpaidtomanagersinkeypositionsaredisclosedunderitem19ofthenotestotheconsolidatedfinancialstatements.

18. auditoreXpenses

inthe2010financialyear,auditingexpensesofeur265thousand(prioryear:eur301thousand)andeur422thousandforotherservices(prioryear:eur200thousand)wereinvoiced.

2010 2009

[EUR’000] [EUR’000]

Receivables fromsubsidiariesnotincludedinconsolidationduetoinsignificance 1,517 4,437associatedcompanies 5,189 47otherrelatedparties 289 1,971

6,995 6,455

2010 2009

[EUR’000] [EUR’000]

Liabilities tosubsidiariesnotincludedinconsolidationduetoinsignificance 151 1,041associatedcompanies 2,579 0otherrelatedparties 5,612 2,115

8,342 3,156

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19. mandatesandemolumentsofthemanagementboard

during the reporting year, themembers of themanagementboardwerenotmembers of anysupervisoryboards.

theamountsofcompensationpaidtoindividualmembersofthemanagementboardwereasfol-lows:

allamountsofcompensationpaidtoindividualmembersofthemanagementboardwereshort-termemployeebenefitswithinthemeaningofias24.16(a).

20. mandatesandemolumentsofthesupervisoryboard

themembersofthesupervisoryboardinthefinancialyear2010wereasfollows:

Edmund hug, Businessman, Oberstenfeld–Chairman– othersupervisoryboardmemberships: •schlottgruppeag,freudenstadt •scholzag,aalen

Prof. Jobst w. Plog, Lawyer, hamburg–vice-Chairman– othersupervisoryboardmemberships: •wallag,berlin(until25January2010) •vattenfalleuropeag,berlin

horst R. Schmidt, Treasurer of the German Football Association, Aschaffenburg (until17september2010) noothersupervisoryboardmemberships

Dr. Bernd Kundrun, Businessman, hamburg(from4november2010) othersupervisoryboardmemberships: •gut.orggemeinnützigeaktiengesellschaft,berlin(Chairman)

themembersofthesupervisoryboardofCtsagreceivedemolumentstotallingeur80thou-sandaswellasreimbursedexpensesofeur9thousandforthe2010financialyear.theseamountsareallshort-termbenefitswithinthemeaningofias24.16(a).

Name Fixed salary Benefits Management Bonus Total


klaus-peterschulenberg 1,000,000 298 300,000 1,300,298volkerbischoff 350,000 12,135 105,000 467,135alexanderruoff 350,000 10,529 105,000 465,529

1,700,000 22,962 510,000 2,232,962

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21. partiCipatingpersons

thecompany receivednotificationsunder §21 (1)wphg (securitiestradingact) concerninginvestmentsexceeding3%or5%ofthevotingrights,andinvestmentsincreasingbeyondorfallingbelow3%or5%ofthevotingrights.

filholdingslimited,kent,england,uk,notifiedthecompanyon17may2010thatitsshareofvotingrightsinCtsagexceededthe3%thresholdon2January2009andamountedonthelat-terdateto4.93%,andthatthesevotingrightsareallocatedtofilholdingslimitedunder§22(1)sentence1,no.6incombinationwith§22(1)sentence2wphg.

filholdingslimited,kent,england,uk,notifiedthecompanyon12may2010thatitsshareofvotingrightsinCtsagfellbelowthe3%thresholdon7may2010andamountedonthelatterdateto2.4%,andthatthesevotingrightsareallocatedtofilholdingslimitedunder§22(1)sentence1,no.6incombinationwith§22(1)sentence2wphg.

filinvestmentmanagementlimited,kent,england,uk,notifiedthecompanyon12may2010thatitsshareofvotingrightsinCtsagfellbelowthe3%thresholdon7may2010andamountedonthelatterdateto2.45%,andthatthesevotingrightsareallocatedtofilinvestmentmanagementlimitedunder§22(1)sentence1,no.6incombinationwith§22(1)sentence2wphg.

filinvestmentsinternational,kent,england,uk,notifiedthecompanyon12may2010thatitsshareofvotingrightsinCtsagfellbelowthe3%thresholdon7may2010andamountedonthelatterdateto2.4%,andthatthesevotingrightsareallocatedtofilinvestmentsinternationalunder§22(1)sentence1,no.6wphg.

fillimited,hamiltonhmCX,bermuda,notifiedthecompanyon12may2010that itsshareofvotingrightsinCtsagfellbelowthe3%thresholdon7may2010andamountedonthelatterdateto2.45%,andthat0.05%thereofareallocatedtofillimitedunder§22(1)sentence1,no.6incombinationwith§22(1)sentence2wphgand2.4%thereoftosaidcompanyinaccordancewith§22(1)sentence1no.6wphg

tremblantholdingsllC,newyork,usa,notifiedthecompanyon25may2010thatitsshareofvotingrightsinCtsagfellbelowthe5%thresholdon18may2010andamountedonthelatterdateto4.98%,andthatthesevotingrights(4.98%)areallocatedintheirentiretytotremblantholdingsllCinaccordancewith§22(1)sentence1,no.1wphg.

tremblantCapitallp,newyork,usa,notifiedthecompanyon25may2010thatitsshareofvot-ingrightsinCtsagfellbelowthe5%thresholdon18may2010andamountedonthelatterdateto4.98%,andthatthesevotingrights(4.98%)areallocatedintheirentiretytotremblantCapitallpinaccordancewith§22(1)sentence1,no.6wphg.

tremblantCapitalllC,newyork,usa,notifiedthecompanyon25may2010thatitsshareofvot-ingrightsinCtsagfellbelowthe5%thresholdon18may2010andamountedonthelatterdateto4.98%,andthatthesevotingrights(4.98%)areallocatedintheirentiretytotremblantCapitalllCinaccordancewith§22(1)sentence1,no.6incombinationwith§22(1)sentence2wphg.

Columbiamanagementinvestmentadvisers,llC,boston,usa,notifiedthecompanyon10June2010,correctingitsnotificationofvotingrightson12may2010,thatitsshareofvotingrightsinCtsagexceededthe3%and5%thresholdson30april2010andamountedonthelatterdateto5.11%,

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andthat0.13%thereofareallocatedtoColumbiamanagementinvestmentadvisersinaccordancewith§22(1)sentence1,no.6wphgand4.98%thereoftosaidcompanyinaccordancewith§22(1)sentence1no.6incombinationwith§22(1)sentence2wphg.

Columbiamanagementinvestmentadvisers,llC,boston,usa,notifiedthecompanyon10June2010,correctingitsnotificationofvotingrightson14may2010,thatitsshareofvotingrightsinCtsagfellbelowthe5%thresholdon11may2010andamountedonthelatterdateto4.97%,andthat0.13%thereofareallocatedtoColumbiamanagementinvestmentadvisersinaccordancewith§22(2)sentence1,no.6wphgand4.84%thereoftosaidcompanyinaccordancewith§22(1)sentence1no.6incombinationwith§22(1)sentence2wphg.

ameriprisefinancialinc.,minneapolis,usa,notifiedthecompanyon10June2010,correctingitsnotificationofvotingrightson12may2010,thatitsshareofvotingrightsinCtsagexceededthe3%and5%thresholdson30april2010andamountedonthelatterdateto7.89%,andthatthesevotingrights(7.89%)areallocatedintheirentireytoameriprisefinancialinc.inaccordancewith§22(1)sentence1,no.6incombinationwith§22(1)sentence2wphg.

ColumbiawangerassetmanagementllC,Chicago,usa,notifiedthecompanyon10June2010,correctingitsnotificationofvotingrightson12may2010,thatitsshareofvotingrightsinCtsagfellbelowthe5%thresholdon30april2010andamountedonthelatterdateto4.98%,andthatthesevotingrights(4.98%)areallocatedintheirentiretytoColumbiawangerassetmanagementllCinaccordancewith§22(1)sentence1,no.6wphg.


tremblantpartnersmasterfundlp,Camanabay,grandCayman,Caymanislands,notifiedthecompanythatitsshareofvotingrightsinCtsagexceededthe3%thresholdon4august2010andamountedto3.05%onthelatterdate.

tremblantpartnersltd.,Camanabay,grandCayman,Caymanislands,notifiedthecompanythatitsshareofvotingrightsinCtsagexceededthe3%thresholdon4august2010andamountedonthelatterdateto3.05%,andthatthesevotingrightsareallocatedtotremblantpartnersltd.inaccordancewith§22(1)sentence1,no.2wphg.votingrightsareallocatedtoitbythefollowingshareholderswhosevotingrights inCtsagamount to3%ormore:tremblantpartnersmasterfundl.p.

mrbrettbarakett,usa,notifiedthecompanythathisshareofvotingrightsinCtsagfellbelowthe5%thresholdon18may2010andamountedonthelatterdateto4.98%,andthatthesevotingrights(4.98%)areallocatedintheirentiretytomrbrettbarakettinaccordancewith§22(1)sen-tence1,no.6wphgincombinationwith§22(1)sentence2wphg,andalsoinaccordancewith§22(1)sentence1no.1wphg.thevotingrightsallocatedinaccordancewith§22(1)sentence1no.1wphgareheldbythefollowingentitiescontrolledbyhimandwhosevotingrightsinCtsagamountto3%ormore:tremblantholdingsllC.

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tremblantpartnersmasterfundlp,Camanabay,grandCayman,Caymanislands,notifiedthecompanythatitsshareofvotingrightsinCtsagfellbelowthe3%thresholdon31december2010andamountedto2.99%onthelatterdate.

tremblantpartnersltd.,Camanabay,grandCayman,Cayman islands,notified thecompanythat itsshareofvotingrights inCtsagfellbelowthe3%thresholdon31december2010andamountedonthe latterdateto2.99%,andthat thesevotingrights(2.99%)areallocated intheirentiretytotremblantpartnersltd.inaccordancewith§22(1)sentence1,no.2wphg.

inggroepn.v.,amsterdam,thenetherlands,notifiedthecompanythatitsshareofvotingrightsinCtsagexceededthe3%thresholdon11february2011andamountedonthelatterdateto3.09%,andthatthesevotingrightsareallocatedintheirentiretytoinggroepn.v.inaccordancewith§22(2)wphgandalsoinaccordancewith§22(1)sentence1,no.1wphg.

allocatedvotingrightsareheldbythefollowingentitiescontrolledbyinggroepn.v.andwhosevotingrights inCtsagamount to3%ormore: ingverzekeringenn.v.nationale-nederlandennederlandb.v.

ingverzekeringenn.v.,amsterdam,thenetherlands,notifiedthecompanythatitsshareofvot-ingrightsinCtsagexceededthe3%thresholdon11february2011andamountedonthelatterdateto3.09%,andthatthesevotingrightsareallocatedintheirentiretytoingverzekeringenn.v.inaccordancewith§22(2)wphgandalsoinaccordancewith§22(1)sentence1,no.1wphg.

allocatedvotingrightsareheldbythefollowingentitiescontrolledbyingverzekeringenn.v.andwhosevotingrightsinCtsagamountto3%ormore:nationale-nederlandennederlandb.v.

nationale-nederlandennederlandb.v., ‘s-gravenhage, thenetherlands,notified thecompanythat its shareof voting rights inCtsagexceeded the3% thresholdon11february2011andamountedonthelatterdateto3.09%,andthatthesevotingrightsareallocatedintheirentiretytonationale-nederlandennederlandb.vinaccordancewith§22(2)wphgandalsoinaccordancewith§22(1)sentence1,no.1wphg.

ingreholding(netherlands)b.v.,amsterdam, thenetherlands,notified thecompany that itsshareofvotingrightsinCtsagexceededthe3%thresholdon11february2011andamountedonthelatterdateto3.09%,andthatthesevotingrightsareallocatedintheirentiretytoingreholding(netherlands)b.v.inaccordancewith§22(2)wphgandalsoinaccordancewith§22(1)sentence1,no.1wphg.

ingre(netherlands)n.v.,denhaag,thenetherlands,notifiedthecompanythatitsshareofvot-ingrightsinCtsagexceededthe3%thresholdon11february2011andamountedonthelatterdateto3.09%,andthat2.98%thereofareallocatedtoingre(netherlands)inaccordancewith§22(2)wphg.

inglevensverzekeringretailn.v.,amsterdam, thenetherlands,notified thecompany that itsshareofvotingrightsinCtsagexceededthe3%thresholdon11february2011andamountedonthelatterdateto3.09%,andthat2.94%thereofareallocatedtoinglevensverzekeringretailn.v.,inaccordancewith§22(2)wphg.

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ingschadeverzekeringretailn.v.,amsterdam, thenetherlands,notified thecompany that itsshareofvotingrightsinCtsagexceededthe3%thresholdon11february2011andamountedonthelatterdateto3.09%,andthat3.07%thereofareallocatedtoingschadeverzekeringretailn.v.,inaccordancewith§22(2)wphg.

movirn.v.,nieuwegein, thenetherlands,notifiedthecompanythat itsshareofvotingrights inCtsagexceededthe3%thresholdon11february2011andamountedonthelatterdateto3.09%,andthat3.06%thereofareallocatedtomovirn.v.,inaccordancewith§22(2)wphg.

nationale-nederlandenlevensverzekeringmaatschappijn.v.,rotterdam,thenetherlands,noti-fied the company that its share of voting rights inCtsagexceeded the 3% threshold on 11february2011andamountedonthelatterdateto3.09%,andthat0.59%thereofareallocatedtonationale-nederlandenlevensverzekeringmaatschappijn.v.,inaccordancewith§22(2)wphg.

nationale-nederlandenschadeverzekeringmaatschappijn.v.,denhaag,thenetherlands,noti-fiedthecompanythatitsshareofvotingrightsinCtsagexceededthe3%thresholdon11febru-ary2011andamountedonthelatterdateto3.09%,andthatthesevotingrightsareallocatedintheirentiretytonationale-nederlandenschadeverzekeringmaatschappijn.v.,inaccordancewith§22(2)wphg.

rvslevensverzekeringn.v.,ede,thenetherlands,notifiedthecompanythatitsshareofvotingrightsinCtsagexceededthe3%thresholdon11february2011andamountedonthelatterdateto3.09%,andthat2.80%thereofareallocatedtorvslevensverzekeringn.v.,inaccordancewith§22(2)wphg.

rvsschadeverzekeringn.v.,edegld,thenetherlands,notifiedthecompanythatitsshareofvot-ingrightsinCtsagexceededthe3%thresholdon11february2011andamountedonthelatterdateto3.09%,andthat3.08%thereofareallocatedtorvsschadeverzekeringn.v.,inaccordancewith§22(2)wphg.

mr.klaus-peterschulenberg,bremen,held50.07%ofthevotingrightsinthecompanyasat31december2010.

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themanagementboardofCtsagreleasedtheconsolidatedfinancialstatementstothesuper-visoryboardon23march2011.

22. assuranCebylegalrepresentatives

tothebestofourknowledge,theconsolidatedfinancialstatementsgiveatrueandfairviewofthegroup’searningsperformance,financialpositionandcashflow,inaccordancewiththeapplicablereportingprinciples,andthatthecombinedmanagementreportpresentsthecourseofbusiness,includingthegroup’sprofitsandsituation, inawaythataccuratelyreflectsactualcircumstancesand truthfully describes themain opportunities and risks associatedwith thegroup’s expecteddevelopment.

bremen,23march2011

Ctseventimaktiengesellschaft

alexanderruoffvolkerbischoffklaus-peterschulenberg

137


23. auditor’sreport

wehaveauditedtheconsolidatedfinancialstatementspreparedbytheCtseventimaktienges-ellschaft,munich,comprisingthestatementoffinancialposition,theincomestatement,thestate-mentofcomprehensiveincome,statementofchangesinequity,thecashflowstatementandthenotestotheconsolidatedfinancialstatements,togetherwiththegroupmanagementreport,whichiscombinedwiththemanagementreportoftheparentCompanyforthebusinessyearfromJanu-ary1,2010todecember31,2010.thepreparationoftheconsolidatedfinancialstatementsandthecombinedmanagementreportinaccordancewiththeifrss,asadoptedbytheeu,andtheadditionalrequirementsofgermancommerciallawpursuantto§(article)315aabs.(paragraph)1hgb(“handelsgesetzbuch”:germanCommercialCode)aretheresponsibilityoftheparentCom-pany’sboardofmanagingdirectors.ourresponsibilityistoexpressanopinionontheconsolidatedfinancialstatementsandthecombinedmanagementreportbasedonouraudit.

weconductedourauditoftheconsolidatedfinancialstatementsinaccordancewith§317hgbandgermangenerally accepted standards for theaudit of financial statements promulgated bytheinstitutderwirtschaftsprüfer(instituteofpublicauditorsingermany)(idw).thosestandardsrequirethatweplanandperformtheauditsuchthatmisstatementsmateriallyaffectingthepres-entationofthenetassets,financialpositionandresultsofoperationsintheconsolidatedfinancialstatements inaccordancewith theapplicable financial reporting frameworkand in thecombinedmanagementreportaredetectedwithreasonableassurance.knowledgeofthebusinessactivitiesandtheeconomicand legalenvironmentof thegroupandexpectationsastopossiblemisstate-mentsare taken intoaccount in thedeterminationofauditprocedures.theeffectivenessof theaccounting-relatedinternalcontrolsystemandtheevidencesupportingthedisclosuresinthecon-solidatedfinancialstatementsandthecombinedmanagementreportareexaminedprimarilyonatestbasiswithintheframeworkoftheaudit.theauditincludesassessingtheannualfinancialstate-mentsofthoseentitiesincludedinconsolidation,thedeterminationoftheentitiestobeincludedinconsolidation,theaccountingandconsolidationprinciplesusedandsignificantestimatesmadebytheCompany´sboardofmanagingdirectors,aswellasevaluatingtheoverallpresentationoftheconsolidatedfinancialstatementsandthecombinedmanagementreport.webelievethatourauditprovidesareasonablebasisforouropinion.

138


ouraudithasnotledtoanyreservations.

inouropinionbasedon the findingsofouraudit theconsolidated financialstatementscomplywiththeifrssasadoptedbytheeuandtheadditionalrequirementsofgermancommerciallawpursuantto§315aabs.1hgbandgiveatrueandfairviewofthenetassets,financialpositionandresultsofoperationsofthegroupinaccordancewiththeseprovisions.thecombinedmanagementreportisconsistentwiththeconsolidatedfinancialstatementsandasawholeprovidesasuitableviewofthegroup’spositionandsuitablypresentstheopportunitiesandrisksoffuturedevelopment.

osnabrück,23march2011

pricewaterhouseCoopers

aktiengesellschaftwirtschaftsprüfungsgesellschaft

ppa.aloysdeekenwirtschaftsprüfer

(germanpublicauditor)

dr.gregorsolfrianwirtschaftsprüfer


139

financialstatementsCtsag2010

BALANCE ShEET OF CTS AG AS AT 31 DECEMBER 2010 (hGB)

ASSETS 31.12.2010 31.12.2009

[EUR] [EUR]

A. FIXED ASSETSI. Intangible assets1.Concessions,industrialpropertyrightsandsimilarrightsandassets

andlicencesinsuchrightandassets 9,646,769 9,410,5282. goodwill 1,144,745 1,471,8153. paymentsonaccount 991,673 725,214

11,783,187 11,607,557II. Property, plant and equipment1. otherrealestate,landrightsandbuildings,includingbuildingsonthird-partyproperties 130,536 164,7502. technicalequipmentandmachinery 28,622 143,1083. otherfacilities,operatingandofficeequipment 1,935,383 1,785,257

2,094,541 2,093,115III. Investments1. sharesinaffiliatedcompanies 226,912,056 60,439,0872. loansduetoaffiliatedcompanies 11,259,738 03. participations 574,835 574,835

238,746,629 61,013,922B. CURRENT ASSETS

I. Inventories1. finishedproductsandgoods 399,261 711,2102. paymentsonaccount 5,050 16,863

404,311 728,073II. Receivables and other assets1. tradereceivables 5,725,897 5,068,5382. receivablesfromaffiliatedcompanies 12,232,926 19,238,7173. receivablesfromparticipations 2,063,625 31,6714. otherassets 19,046,759 16,373,071

39,069,207 40,711,997III. Marketable securities

treasurystock 0 63,0730 63,073

IV. Cheques, cash in hand and bank balances 38,416,759 86,732,020

C. PREPAID EXPENSES 3,664,984 255,503

Total assets 334,179,618 203,205,260

finAnciAl stAteMents of cts Ag 20108.

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LIABILITIES AND ShAREhOLDERS’ EQUITy 31.12.2010 31.12.2009

[EUR] [EUR]

A. Shareholders’ equityI. Share capital 24,000,000 24,000,000

less par value of treasury stock -2,175 0II. Capital reserve 23,820,894 23,820,894III. Reserve for treasury stock 0 63,073IV. Balance sheet profit 69,417,123 63,206,732

117,235,842 111,090,699B. PROVISIONS

1. taxprovisions 1,529 3,157,7072. otherprovisions 5,564,277 5,600,990

5,565,806 8,758,697C. LIABILITIES

1. liabilitiestobanks 149,000,000 4,500,0002. tradepayables 7,536,270 4,791,7113. liabilitiestoaffiliatedcompanies 2,178,343 531,6774. liabilitiestoparticipations 25,572 05. otherliabilities 51,861,395 73,127,070

210,601,580 82,950,458

D. DEFERRED INCOME 733,123 405,406

E. DEFERRED TAX LIABILITIES 43,267 0

Total shareholders’ equity and liabilities 334,179,618 203,205,260

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INCOME STATEMENT OF CTS AG FOR ThE PERIOD FROM 1 JANUARy TO 31 DECEMBER 2010 (hGB)

01.01.2010 - 31.12.2010

01.01.2009 - 31.12.2009

[EUR] [EUR]

1. revenue 86,348,440 85,077,0002.Costofsales -38,750,371 -36,942,1113. Gross profit 47,598,069 48,134,889

4. sellingexpenses -13,704,168 -10,934,3625. generaladministrativeexpenses -5,673,219 -5,337,9996. otheroperatingincome

ofwhichfromcurrencytranslationeur5,468(2009:eur0) 6,370,878 3,990,6457. otheroperatingexpenses

ofwhichfromcurrencytranslationeur4,895(2009:eur0) -7,040,688 -2,825,7288. incomefromparticipations 4,882,737 3,784,0739. incomefromprofittransferagreements 4,308,989 1,729,12610. otherinterestandsimilarincome 1,341,529 1,096,13711. interestandsimilarexpenses -2,664,598 -237,13412. Profit from ordinary business activities (EBT) 35,419,529 39,399,647

13. incometaxes -9,364,753 -11,521,10914. othertaxes 114,903 -4,860

15. Net income for the year 26,169,679 27,873,678

142

financialstatementsCtsag2010 143


notestothefinanCialstatementsforthe2010finanCialyear

1. preparationoftheannualfinanCialstatements

theannual financial statements for the2010 financial yearwereprepared inaccordancewiththegermanCommercialCode(handelsgesetzbuch–hgb),thestockCorporationact(aktienge-setz)andthearticlesofincorporation.thefinancialyearisthecalendaryear.Ctseventimag(hereinafter:Ctsag)isalargecorporateenterprisewithinthemeaningof§267(3)hgb.optionaldisclosuresaremade in thenotes inorder tomaintainclarityandtransparency.allamountsareroundedtothenearesteuro.

2. aCCountingpoliCies2.1 generaldisClosures

the layoutof thebalancesheetcomplieswith thatspecified in§266hgb inconjunctionwith§152aktg;theincomestatementconformstothegermanformofincomestatementshowing‘costofsales’,pursuantto§275(3)hgbinconjunctionwith§158aktg.

therecognitionandmeasurementrulesstipulatedinthegermanaccountinglawmodernisationact,whichentered into forceon29may2009(bilanzsrechtsmodernisierungsgesetz;hereinafter:bilmog)wereappliedforthefirsttimeintheannualfinancialstatementsforthe2010financialyear,inaccordancewitharticle66(3)sentence1oftheintroductoryacttothegermanCommercialCode(eghgb).thecompanymadenouseoftheoptiontoapplytheserulesprematurely(article66(3)sentence6eghgb).

duetofirst-timeapplicationofthebilmog,‘deferredtaxliabilities’wasaddedasanitemtothebalancesheetlayout.intheincomestatement,‘ofwhichforincomefromcurrencytranslation’wasaddedtothe‘otheroperatingincome’itemasaresultofthechangesbroughtaboutbythebilmog.analogously,‘ofwhichforexpensesfromcurrencytranslation’wasaddedtothe‘otheroperatingexpenses’item.

due to first-timeapplicationof thebilmog,changes resulted in foreigncurrency translation, inthepresentationoftreasurystockandintherecognitionofdeferredtaxliabilities.prior-yearfigureswerenotadjustedbyfirst-timeapplication,pursuanttoarticle67(8)sentence2eghgb.

theotheraccountingpoliciesremainedunchangedcomparedtotheyearbefore.

2.2 reCognitionandmeasurement

Intangible assetsaremeasuredatcostandreducedbystraight-lineamortisation(proportionatelyintheyearofaddition).

therecognisedgoodwillfrombringingintheticketingbusinessissubjecttosystematicstraight-lineamortisationovertheestimatedusefullifeof15years,astheearningsprospectswillhaveaneffectoverthisperiodoftime.thetrademarkrightobtainedbyacquiringthe‘getgo.de’internetpor-talintheyear2002isamortisedoveraperiodoftenyears.thedistributionrightsobtainedin2006byacquiringCtseventimsportsgmbh,hamburg,areamortisedoveraperiodoffiveyears.the

144


‘globalticketingsystem’capitalisedintheyear2007inthecourseofimplementinginternationalrequirementsisamortisedoverausefullifeoftwelveyears.

Property, plant and equipmentaremeasuredatcost,includingancillaryexpenses,minussys-tematicdepreciation.

Shares in affiliated companies andparticipations aremeasuredat cost, includingancillaryexpenses.

Inventoriesaremeasuredatcost,takingancillaryexpensesintoaccount,oratthelowermarketprices.theprinciplesofloss-freemeasurementwereobserved.

Receivables and other assetsaremeasuredattheirnominalvalueminusadjustmentsforalldis-cerniblerisks.asufficientoverallvalueadjustmentof1%wasmadeonthenetreceivablesinordertocoverthegeneraldefaultandcreditrisk.

Cash and cash equivalentsarecarriedattheirnominalvalueonthebalancesheetdate.

Prepaid expensesincludespaymentsmadebeforetheclosingdatethatrepresentexpensesforaspecificperiodaftertheclosingdate.

Shareholders’ equityismeasuredatnominalvalue.

Provisionsarerecognisedatthesettlementamountandareformedinappropriatemeasuretocoverdiscernible risksandcontingencies, inaccordancewith theprinciplesofprudentbusinessjudgement.

Liabilitiesarerecognisedattheirredemptionvalue.

Deferred tax liabilitiesarerecognisedbyfirst-timeapplicationofthebilmogtoaccountfordif-ferencesintheaccountingpoliciesgoverningthecommercialbalancesheetandthefiscalbalancesheet.

2.3 CurrenCytranslation

short-termforeigncurrencyreceivables,otherassets,cashandcashequivalentsandshort-termforeigncurrency liabilitiesweremeasuredusing themiddlespotmarketpriceasat thebalancesheetdate.

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3. notesandCommentsonspeCifiCitemsoftheannualfinanCialstatement

3.1 balanCesheet

statementofChangesinassetsfortheperiodfrom1Januaryto31deCember2010(hgb)

historical cost Accumulative depreciation and amortisation Carrying value

01.01.2010

Addition

DisposalReclas-

sification

31.12.2010 01.01.2010

Addition

Disposal

31.12.2010 31.12.2010

31.12.2009

[EUR] [EUR] [EUR] [EUR] [EUR] [EUR] [EUR] [EUR] [EUR] [EUR] [EUR]

I. Intangible assets1.Concessions,industrialpropertyrightsandsimilarrightsand

assets,andlicencesinsuchrightsandassets 35,873,370 2,391,357 0 273,548 38,538,275 26,462,842 2,428,664 0 28,891,506 9,646,769 9,410,5282. goodwill 4,906,054 0 0 0 4,906,054 3,434,239 327,070 0 3,761,309 1,144,745 1,471,8153. paymentsonaccount 725,214 540,007 0 -273,548 991,673 0 0 0 0 991,673 725,214

41,504,638 2,931,364 0 0 44,436,002 29,897,081 2,755,734 0 32,652,815 11,783,187 11,607,557II. Property, plant and equipment1.otherrealestate,landrightsandbuildings,

includingbuildingsonthird-partyproperties 232,969 0 0 0 232,969 68,219 34,214 0 102,433 130,536 164,7502. technicalequipmentandmachinery 572,445 0 0 0 572,445 429,337 114,486 0 543,823 28,622 143,1083. otherfacilities,operatingandofficeequipment 8,776,197 789,850 26,951 0 9,539,096 6,990,940 633,235 20,462 7,603,713 1,935,383 1,785,257

9,581,611 789,850 26,951 0 10,344,510 7,488,496 781,935 20,462 8,249,969 2,094,541 2,093,115III. Investments1.sharesinaffiliatedcompanies 60,439,087 170,927,576 4,454,607 0 226,912,056 0 0 0 0 226,912,056 60,439,0872. loansduetoaffiliatedcompanies 0 11,259,738 0 0 11,259,738 0 0 0 0 11,259,738 03. participations 574,835 0 0 0 574,835 0 0 0 0 574,835 574,835

61,013,922 182,187,314 4,454,607 0 238,746,629 0 0 0 0 238,746,629 61,013,922

Total 112,100,171 185,908,528 4,481,558 0 293,527,141 37,385,577 3,537,669 20,462 40,902,784 252,624,357 74,714,594

146


historical cost Accumulative depreciation and amortisation Carrying value

01.01.2010

Addition

DisposalReclas-

sification

31.12.2010 01.01.2010

Addition

Disposal

31.12.2010 31.12.2010

31.12.2009

[EUR] [EUR] [EUR] [EUR] [EUR] [EUR] [EUR] [EUR] [EUR] [EUR] [EUR]

I. Intangible assets1.Concessions,industrialpropertyrightsandsimilarrightsand

assets,andlicencesinsuchrightsandassets 35,873,370 2,391,357 0 273,548 38,538,275 26,462,842 2,428,664 0 28,891,506 9,646,769 9,410,5282. goodwill 4,906,054 0 0 0 4,906,054 3,434,239 327,070 0 3,761,309 1,144,745 1,471,8153. paymentsonaccount 725,214 540,007 0 -273,548 991,673 0 0 0 0 991,673 725,214

41,504,638 2,931,364 0 0 44,436,002 29,897,081 2,755,734 0 32,652,815 11,783,187 11,607,557II. Property, plant and equipment1.otherrealestate,landrightsandbuildings,

includingbuildingsonthird-partyproperties 232,969 0 0 0 232,969 68,219 34,214 0 102,433 130,536 164,7502. technicalequipmentandmachinery 572,445 0 0 0 572,445 429,337 114,486 0 543,823 28,622 143,1083. otherfacilities,operatingandofficeequipment 8,776,197 789,850 26,951 0 9,539,096 6,990,940 633,235 20,462 7,603,713 1,935,383 1,785,257

9,581,611 789,850 26,951 0 10,344,510 7,488,496 781,935 20,462 8,249,969 2,094,541 2,093,115III. Investments1.sharesinaffiliatedcompanies 60,439,087 170,927,576 4,454,607 0 226,912,056 0 0 0 0 226,912,056 60,439,0872. loansduetoaffiliatedcompanies 0 11,259,738 0 0 11,259,738 0 0 0 0 11,259,738 03. participations 574,835 0 0 0 574,835 0 0 0 0 574,835 574,835

61,013,922 182,187,314 4,454,607 0 238,746,629 0 0 0 0 238,746,629 61,013,922

Total 112,100,171 185,908,528 4,481,558 0 293,527,141 37,385,577 3,537,669 20,462 40,902,784 252,624,357 74,714,594

147


theeur185.908millioninadditionstoassetsrelatetoadditionstointangibleassets(eur2.931million),toproperty,plantandequipment(eur790thousand)andtoinvestments(eur182.187million).theadditionstointangibleassetsresultprimarilyfromfurtherdevelopmentoftheglobalticketingsystem(eur2.736million).theadditionstoproperty,plantandequipmentrelateprima-rilytoithardwareforoperatingtheglobalticketingsystemandforconnectingticketofficestotheglobalticketingsystem(eur665thousand).theadditionstoinvestmentsinthereportingyearrelatetonewlyacquiredsharesinsubsidiaries(eur135.724million)andtoincreasesinthecar-ryingvaluesofparticipationsduetosharecapital increasesinsubsidiaries(eur35.203million).theadditionstoloansduetoaffiliatedcompaniesrelatetothetakeoverofreceivablesfromformershareholdersinacompanyacquiredinthereportingyear(eur11.260million).

Receivables and other assetsamountingtoeur1.185million(prioryear:eur2.380million)havearemainingtermofbetweenoneandfiveyears.

Receivables from affiliated companiesincludetradereceivablesamountingtoeur2.909mil-lion(prioryear:eur3.533million).

Receivables from participations include trade receivables amounting toeur156 thousand(prioryear:eur32thousand).

Prepaid expensesmainlycompriseeur3.309millioninprepaidfinancingexpenses(prioryear:eur0),eur58thousandincommissionexpenses(prioryear:eur29thousand),eur86thou-sandinmaintenanceexpenses(prioryear:eur43thousand)andeur33thousandinpromotionexpenses(prioryear:eur61thousand).

theannualshareholders’meetingofthecompanyheldon23august2005resolvedtoincreasetheshare capitalofCtsag,previouslyamountingtoeur12,000,000,byaddinganadditionaleur12,000,000 from reserves.theshare capital increasewas registeredat themunichlocalCourton6october2005,andthenewno-parvaluebearershareswerecreditedtoshareholderdepotson30october2005.asattheclosingdate,thecompanyhadthusissued24,000,000no-parvaluebearershares.eachsharerepresentsanarithmeticshareinthesharecapitalofeur1.00.

as at the closing date,authorised capital amounted toeur12,000,000 (authorised capital2009).itisgranteduntil13may2014.byresolutionoftheshareholders’meetingon14may2009,themanagementboardisauthorisedtoincreasethesharecapitalofthecompanyononeormoreoccasionsintheperiodupto13may2014,contingentonsupervisoryboardapproval,byissuingnewsharesagainstcashdepositsorcontributions inkind, thetotal increasenot toexceedeur12,000,000.the shareholdersmust begranted subscription rights to suchnewshares, but themanagementboardisauthorisedtoexcludesuchsubscriptionrights incertaincases,subjecttosupervisoryboardapproval.nousehasbeenmadesofarofthisauthorisation.

attheshareholders’meetingon21January2000,acontingent share capital increaseofeur180,000wasagreed(contingentcapital2000/1).thisincreaseshallbeeffectedonlytotheextentthatholdersofoptionsissuedunderthestockoptionplanonthebasisoftheauthorisationgrantedon21January2000exercise theirstockoptions.thenewsharesparticipate in theprofitsof thecompanyfromthebeginningofthefinancialyearinwhichthestockoptionsareexercised.theman-agementboardisauthorised,subjecttoapprovalbythesupervisoryboard,tospecifythefurtherdetailsofthecontingentcapitalincreaseanditsimplementation.asaconsequenceofthesharehold-ers’resolutionon23august2005toincreasethesharecapitaltoeur24,000,000,thiscontingentsharecapitalhasincreasedaccordinglytoeur360,000inaccordancewith§218sentence1aktg.

148


theannualshareholders’meetingheldon15may2008authorised themanagementboard toissuestockoptionsandconvertiblebonds toa total valueofup toeur275millionandwithamaximumtermof20years,conditionalonsupervisoryboardapproval,by14may2013,togranttheholdersoptionandconversionrightstoupto11,000,000newno-parbearersharesinthecom-pany,equaltosharecapitalofuptoeur11,000,000,andtoexcludeshareholders,withinlegallypermittedlimits,fromsubscribingtotheconvertiblebondsundercertainconditions.inviewofthepossibleissueofsharestoholdersofoptionandconversionrightsonthebasisofthisauthorisation,thecompany’sarticlesofincorporationwereamendedsimultaneouslytocreateanadditionaleur11,000,000incontingentcapital(‘contingentcapital2008’).nousehasbeenmadesofarofthisauthorisation.

byresolutionoftheshareholders’meetingheldon12may2010,thecompanywasalsoauthor-isedunder§71(1)no.8aktgtopurchasetreasury stockamountingtoupto10%oftheregisteredsharecapitalasatthedateofresolution,by11may2015,andtousetheseforspecificpurposesasdetailed in the resolution,partiallywithexclusionof subscription rights for shareholders.thecountervaluepaidforthesesharesmaynotexceedorfallbelowthetradedpricebymorethan10%.theapplicablesharepriceisdefinedasthemeanclosingpriceforsharesontheXetratradingplatformduringthelastfivetradingdaysbeforepublicationoftheoffertopurchasetheshares.thevolumeoftheofferingmaybelimited.ifthetotalsubscriptiontothebidexceedssaidvolume,quotasshallbeallocatedinproportiontothenumberofsharesofferedineachcase.theauthorisationtorepurchaseownsharesmaybeexercisedundertheaforementionedrestrictionsinpartialamounts,ononeormoreoccasions,andtopursueoneormoreaims.

thepremium(§272(2)no.1hgb) for theshares issuedon thestockexchange isdisclosedundercapital reserve.aspartofthesharecapital increaseimplementedinoctober2005,eur12,000,000ofthecapitalreservewasconvertedtosubscribedcapital,and12,000,000newno-parvaluebearershareswereissued.

Treasury stock remainedunchanged in 2010.this item involves2,175 shares thatwerepur-chasedon31July2007atapriceofeur28.99pershare.theyrepresent0.009%oreur2.175oftheregisteredsharecapital.inthecontextoffirst-timeapplicationoftherecognitionandmeas-urementrulesaccordingtothebilmog,thearithmeticparvalueoftreasurystockhadtobeclearlydistinguishedfromthesubscribedcapital.thedifferencebetweentheparvalueandthefairvalueonthebalancesheetdatewasoffsetagainstthebalancesheetprofit.thereversalofreserves for treasury stockthatwasrequiredinthisconnectionwaslikewiseoffsetagainstthebalancesheetprofit.

Deferred tax liabilitieshadtobeformedduetofirst-timeapplicationofthebilmog,whichhadtobelikewiseoffsetagainstthebalancesheetprofit.

149


Other provisions includeeur1.663million inprovisions for personnel expenses (prior year:eur1.421million),eur153thousandforlegal,consultancyandlitigationexpenses(prioryear:eur48 thousand),eur2.139million for outstanding supplier invoices (prior year:eur1.295million),eur804thousandforoutstandingcommission(prioryear:eur2.012million),eur110thousandforoutstandingcreditnotes(prioryear:eur90thousand),eur80thousandforsupervi-soryboardemoluments(prioryear:eur72thousand),andeur267thousandforaccountingandauditingexpenses(prioryear:eur270thousand).

Liabilities to affiliated companiesrelatewitheur1.099million(prioryear:eur532thousand)totradepayables.

Liabilities to participationsconsistentirelyof tradepayablesamountingtoeur25thousand(prioryear:eur0).

thebalance sheet profit developedasfollows:

31.12.2010 31.12.2009

[EUR’000] [EUR’000]

balancesheetprofitasat31december2009/2008 63,207 49,983recognitionofdeferredtaxliabilities -44 0offsetofparvaluedifferenceintreasurystock -61 0Changesinreservesfortreasurystock 63 -11netincomefortheyear2010/2009 26,170 27,874

89,335 77,846

dividends2010/2009 -19,918 -14,639Balance sheet profit as at 31 December 2010/2009 69,417 63,207

150


Other liabilities,ateur51.861million,mainlycompriseliabilitiesinrespectofticketmoniesthathavenotyetbeeninvoiced(eur46.296million;prioryear:eur68.119million).theliabilitiesinrespectofticketmoniesthathavenotyetbeeninvoicedresultprimarilyfrompre-salesforfutureeventsandtours.theliabilitiesinrespectofticketmoniesthathavenotyetbeeninvoicedareoffsetbybankbalancesandbyreceivablesinrespectofoutstandingticketmonies,asstatedunderotherassets.otherliabilitiesincludeeur2.113millioninliabilitiestoaffiliatedcompaniesinrespectofticketmoniesthathavenotyetbeeninvoiced(prioryear:eur15.065million).

thedeferred tax liabilitiesresultfromdifferentaccountingpoliciesgoverningtherecognitionofparticipationsinaffiliatedcompaniesinthecommercialbalancesheetandthefiscalbalancesheet.measurementofdeferredtaxesisbasedonaneffectivetaxationrateof31.23%,obtainedfromacorporatetaxrateof15.00%plusasolidaritysupplementof5.50%oncorporationtax,andamunici-paltradetaxrateof15.40%.

Statements of liabilities Total Remaining term

duewithin1year

duebetween1yearand5

yearsdue>5years 1)fromtaxes

2)orsocialsecurity

[EUR] [EUR] [EUR] [EUR] [EUR]

liabilitiestobanks149,000,000 500,000 105,642,864 42,857,136(2009:eur4.500m) (2009:eur0.500m) (2009:eur4.000m) (2009:eur0m)

tradepayables7,536,270 7,536,270

(2009:eur4.792m) (2009:eur4.792m)

liabilitiestoaffiliatedcompanies2,178,343 2,178,343

(2009:eur0.532m) (2009:eur0.532m)

liabilitiestoparticipations25,572 25,572

(2009:eur0m) (2009:eur0m)

otherliabilities51,861,395 51,861,395 1)1,533,001

(2009:eur73.127m) (2009:eur73.127m) (2009:eur1.881m)

2)713

(2009:eur0.002m)

Total liabilities 210,601,580 62,101,580 105,642,864 42,857,136

theresidualtermsoftheliabilitiesasat31december2010areshowninthefollowingstatementofliabilities:

151


theselling expensesforthe2010financialyearincludeeur327thousandinfullamortisationofgoodwill(prioryear:eur327thousand),eur99thousandinproportionaldepreciationandamor-tisation(51%)of the trademarkrights for the ‘getgo.de’ internetportalacquired(prioryear:eur99thousand),aswellaseur536thousandofdistributionrights(prioryear:eur536thousand),software(eur603thousand;prioryear:eur518thousand)andproperty,plantandequipment

Personnel expensescomprisedthefollowingitems,pursuantto§275(2)no.6hgb:

Personnel expenses (according to type of expenditure method) 2010 2009 Change

[EUR’000] [EUR’000] [EUR’000]

wagesandsalaries 10,148 8,435 1,713socialsecuritycontributionsandexpensesforpensionandemployeesupport 1,209 993 216

11,357 9,428 1,929

eur7.686millionoftotalrevenuewasgeneratedinforeigncountries.

Material expenses comprisedthefollowingitemspursuantto§275(2)5hgb:

Material expenses (according to type of expenditure method) 2010 2009 Change

[EUR’000] [EUR’000] [EUR’000]

Costofpurchasedmerchandise 1,103 1,342 -239Costofpurchasedservices 32,721 31,372 1,349

33,824 32,714 1,110

3.2 inComestatement

Revenueisbrokendownasfollows:

2010 2009 Change

[EUR’000] [EUR’000] [EUR’000]

Ticket revenue 69,218 68,619 599Licence Fees 6,253 4,464 1,789

Other revenuedatalinecharges 2,668 2,719 -51systemrental/maintenance/installation 2,930 4,010 -1,080salesofmerchandise 486 837 -351packagetours 808 1,517 -709other 3,985 2,911 1,074

86,348 85,077 1,271

152


theeur43.289millionprofitcarriedforwardintheprioryearwasreducedbyeur44thousandtoeur43.245millionincompliancewiththegermanaccountinglegislationgoverningthetransitiontorecognitionofdeferredtaxliabilitiesnotthroughprofitandloss,byfirst-timeapplicationofthenewaccountingrulesaccordingtobilmog.

ofthebalancesheetprofitforthepreviousyear,ateur63.207million,eur19.918millionweredistributedtoshareholdersandeur43.289millionwerecarriedforwardtothenewaccount.

31.12.2010 31.12.2009

[EUR’000] [EUR’000]

netincomefortheyear 26,170 27,874profitcarriedforward 43,245 35,344offsetofparvaluedifferenceintreasurystock -61 0Changesinreservesfortreasurystock 63 -11Balance sheet profit 69,417 63,207

(eur399thousand;prioryear:eur465thousand).theremainingamountofproportionaldepre-ciationandamortisation(49%)ofproperty,plantandequipmentandintangibleassetsisallocatedtocostofsalesoradministrativeexpenses.

Other operating incomeincludeseur457thousandinnon-periodicincomefromthereversalofprovisions(prioryear:eur418thousand),eur464thousandinincomefromwritten-offliabilities(prioryear:eur17)andeur21thousandinretroactiverefunds(prioryear:eur45thousand).

Other operating expenses includeeur24thousandinnon-periodicexpensesfromfollow-upinvoices(prioryear:eur58thousand).

theeur4.883millioninincome from participationsaregeneratedentirelybyaffiliatedcompa-nies(prioryear:3.784million).

Other interest and similar incomeincludeseur573thousandinincomefromaffiliatedcompa-nies(prioryear:eur382thousand).

Interest and similar expensesincludesexpensesofaffiliatedcompaniesamountingtoeur72thousand(prioryear:eur0).

Income taxes includeeur4.633million inmunicipal tradetax(prioryear:eur5.691million),eur4.372million in corporation tax (prior year:eur5.538million) andeur241 thousand insolidaritysupplementtocorporationtaxforthe2010financialyear(prioryear:eur304thousand).taxesonincomealsoincludeforeignwithholdingtaxexpenses(eur68thousand)andnon-peri-odicexpensesforretrospectivetaxpaymentsforpreviousyears(eur51thousand).

Other taxesamountingtoeur-114thousand(prioryear:eur5thousand)comprisevehicletaxexpenses(eur6thousand)andeur121thousandinincomefromrefundedsalestaxforpreviousyears.

inaccordancewith§158aktg,reconciliationofthenetincomefortheyearwiththebalancesheetprofitisasfollows:

153


4. otherdisClosures4.1 ContingentliabilitiesandotherfinanCialobligations

thecompanybearsliabilityfordebtsowedtobanksbyCtseventimsolutionsgmbh,bremen.asatthebalancesheetdate,Ctseventimsolutionsgmbhhasnoliabilitiestobanks.Ctsagalsobearsliabilityforeur5.000millionincreditlinesgrantedbybankstosubsidiariesoftheswissticketcornergroup.asattheclosingdate,thecreditlineshadnotbeenavailedofbythesubsidi-aries.asatthebalancesheetdate,thereisthereforenoriskofclaimsagainstCtsagduetoitsliabilityforloanliabilitiesofCtseventimsolutionsgmbhandtheticketcornergroup.

followingacquisitionoftheticketcornergroup,thecompanyalsobearsliabilityforuptoamaxi-mumofChf26.000millionowedtobanksbyeventimChag,Zurich.thedebtsowedtobanksbyeventimChagamounttoChf52.000millionasatthebalancesheetdate.duetothepositiveearningsperformanceexpectedoftheticketcornergroup,itisassumedthateventimChagasholdingcompanywillbeabletohonouritsobligations.nodemandsonCtsagduetotheassump-tionofliabilityarethereforeexpected.asfurthercollateralfortheseliabilities,Ctsaghaspledgeditsshares,whichamountto50%ofthesharecapitalofeventimChag,tothebank.fortheafore-mentionedreasons,itisnotexpectedthatanyclaimswillbemadeagainstthepledge.

Contingent liabilitiesamounting toeur4.799million,asat theclosingdate,derive frombankguaranteesgrantedonbehalfofCtsag forasubsidiary in theliveentertainmentsegment tosafeguardcontractualobligations.noclaimsareexpected,asthesubsidiarywillbeabletohonouritscontractualobligationswithrevenuefromticketpre-sales,whichcompensatesfortheguaranteecommitment.

thecompanyalsobearscontingentliabilityforobligationsowedbyeventimukltd.toaserviceprovider.asatthebalancesheetdate,eventimukltd.hasnoliabilitiestotheserviceprovider,sothereisnoriskofclaimsasatthatdate.

asattheclosingdate,therewereotherfinancialliabilitiesamountingtoeur7.330million(prioryear:eur34.175million).ofthattotal,eur4.501million(prioryear:eur26.204million)haveamaturityofoneyearorless.theseobligationsarepartlyconditionalbidsamountingtoeur1.931million(prioryear:eur1.837million)thatCtsagmadeinordertoacquireadditionalsharesinsubsidiaries.theobligation resulting fromconditionalpurchaseoffers relates toputoptions thathavenotyetbeenexercised.otherfinancialobligationsrelatingtoshort-andmedium-termrentalandleasecontractsandothercontractualagreementsamounttoafurthereur5.399million(prioryear:eur6.499million).ofthattotal,eur2.569million(prioryear:eur2.291million)haveamaturityofoneyearorless.futurerentalobligationsaccountforeur4.259million(prioryear:eur5.576million),leasingobligationsforeur198thousand(prioryear:eur260thousand)andotherobligationsforeur942thousand(prioryear:eur663thousand).theotherfinancialcommitmentsareeur91thousandtoaffiliatedcompanies(prioryear:eur77thousand).

154


Name

Fixed salary Benefits

Management Bonus

Total


klaus-peterschulenberg 1,000,000 298 300,000 1,300,298volkerbischoff 350,000 12,135 105,000 467,135alexanderruoff 350,000 10,529 105,000 465,529 1,700,000 22,962 510,000 2,232,962

4.2 appropriationofearnings

inthe2010financialyear,Ctsaggeneratedeur26.170millioninnetincomeaccordingtothegermanCommercialCode.themanagementboardand thesupervisoryboardpropose to theshareholdersʼmeetingthatadividendofeur20.878million(eur0.87pereligibleshare)bedis-tributed,andthattheremainingeur5.292millionbecarriedforwardtothenewaccount.

4.3 listofpartiCipations

alistofshareholdingsispublishedonthecompanyʼswebsite.

4.4 eXeCutivebodiesofCtsag

themembersofthemanagementboardinthefinancialyearwereasfollows:

Klaus-Peter Schulenberg, Bremen –Chiefexecutiveofficer–

Dipl.-Ökonom Volker Bischoff, Stuhr–Chieffinancialofficer–

Dipl.-Betriebswirt Alexander Ruoff, Bremen, –Chiefoperatingofficer–

theamountsofcompensationpaidtoindividualmembersofthemanagementboardwereasfol-lows:

155


themembersofthesupervisoryboardinthe2010financialyearwereasfollows:

Edmund hug, Businessman, Oberstenfeld–Chairman– othersupervisoryboardmemberships: •schlottgruppeag,freudenstadt •scholzag,aalen

Prof. Jobst w. Plog, Lawyer, hamburg–vice-Chairman– othersupervisoryboardmemberships: •wallag,berlin(until25January2010) •vattenfalleuropeag,berlin

horst R. Schmidt, Treasurer of the German Football Association, Aschaffenburg(until17september2010) noothersupervisoryboardmemberships

Dr. Bernd Kundrun, Businessman, hamburg(from4november2010) othersupervisoryboardmemberships: •gut.orggemeinnützigeaktiengesellschaft,berlin(Chairman)

themembersofthesupervisoryboardofCtsagreceivedemolumentstotallingeur80thou-sandaswellasreimbursedexpensesofeur9thousandforthe2010financialyear.

4.5 employees

onaverage,154personswereemployedbythecompanyduringtheyear(prioryear:140).thesewereallsalariedemployees.

4.6 deClarationConCerningtheCorporategovernanCeCode

thedeclarationbythemanagementboardandthesupervisoryboardofthecompanypursuantto§161aktg,regardingtheextenttowhichtherecommendationsofthegermanCorporategovern-anceCodehavebeenandarebeingcompliedwith,andwhichrecommendationswerenotorarenotapplied,wassubmittedandmadepermanentlyavailabletotheshareholdersonthecompany’swebsite (http://www.eventim.de/tickets.html?affiliate=eve&fun=tdoc&doc=eventim/default/info/en/investor/investorCorporategovernance/correspondingdeclaration).

156


4.7 partiCipatingpersons

thecompany receivednotificationsunder § 21 (1)wphg (securitiestradingact) concerninginvestmentsexceeding3%or5%ofthevotingrights,andinvestmentsincreasingbeyondorfallingbelow3%or5%ofthevotingrights.

filholdingslimited,kent,england,uk,notifiedthecompanyon17may2010thatitsshareofvotingrightsinCtsagexceededthe3%thresholdon2January2009andamountedonthelat-terdateto4.93%,andthatthesevotingrightsareallocatedtofilholdingslimitedunder§22(1)sentence1,no.6incombinationwith§22(1)sentence2wphg.

filholdingslimited,kent,england,uk,notifiedthecompanyon12may2010thatitsshareofvotingrightsinCtsagfellbelowthe3%thresholdon7may2010andamountedonthelatterdateto2.4%,andthatthesevotingrightsareallocatedtofilholdingslimitedunder§22(1)sentence1,no.6incombinationwith§22(1)sentence2wphg.

filinvestmentmanagementlimited,kent,england,uk,notifiedthecompanyon12may2010thatitsshareofvotingrightsinCtsagfellbelowthe3%thresholdon7may2010andamountedonthelatterdateto2.45%,andthatthesevotingrightsareallocatedtofilinvestmentmanagementlimitedunder§22(1)sentence1,no.6incombinationwith§22(1)sentence2wphg.

filinvestmentsinternational,kent,england,uk,notifiedthecompanyon12may2010thatitsshareofvotingrightsinCtsagfellbelowthe3%thresholdon7may2010andamountedonthelatterdateto2.4%,andthatthesevotingrightsareallocatedtofilinvestmentsinternationalunder§22(1)sentence1,no.6wphg.

fillimited,hamiltonhmCX,bermuda,notifiedthecompanyon12may2010that itsshareofvotingrightsinCtsagfellbelowthe3%thresholdon7may2010andamountedonthelatterdateto2.45%,andthat0.05%thereofareallocatedtofillimitedunder§22(1)sentence1,no.6incombinationwith§22(1)sentence2wphgand2.4%thereoftosaidcompanyinaccordancewith§22(1)sentence1no.6wphg

tremblantholdingsllC,newyork,usa,notifiedthecompanyon25may2010thatitsshareofvotingrightsinCtsagfellbelowthe5%thresholdon18may2010andamountedonthelatterdateto4.98%,andthatthesevotingrights(4.98%)areallocatedintheirentiretytotremblantholdingsllCinaccordancewith§22(1)sentence1,no.1wphg.

tremblantCapitallp,newyork,usa,notifiedthecompanyon25may2010thatitsshareofvotingrightsinCtsagfellbelowthe5%thresholdon18may2010andamountedonthelatterdateto4.98%,andthatthesevotingrights(4.98%)areallocatedintheirentiretytotremblantCapitallpinaccordancewith§22(1)sentence1,no.6wphg.

tremblantCapitalllC,newyork,usa,notifiedthecompanyon25may2010thatitsshareofvot-ingrightsinCtsagfellbelowthe5%thresholdon18may2010andamountedonthelatterdateto4.98%,andthatthesevotingrights(4.98%)areallocatedintheirentiretytotremblantCapitalllCinaccordancewith§22(1)sentence1,no.6incombinationwith§22(1)sentence2wphg.

Columbiamanagementinvestmentadvisers,llC,boston,usa,notifiedthecompanyon10June2010,correctingitsnotificationofvotingrightson12may2010,thatitsshareofvotingrightsinCtsagexceededthe3%and5%thresholdson30april2010andamountedonthelatterdateto5.11%,

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andthat0.13%thereofareallocatedtoColumbiamanagementinvestmentadvisersinaccordancewith§22(1)sentence1,no.6wphgand4.98%thereoftosaidcompanyinaccordancewith§22(1)sentence1no.6incombinationwith§22(1)sentence2wphg.


ameriprisefinancialinc.,minneapolis,usa,notifiedthecompanyon10June2010,correctingitsnotificationofvotingrightson12may2010,thatitsshareofvotingrightsinCtsagexceededthe3%and5%thresholdson30april2010andamountedonthelatterdateto7.89%,andthatthesevotingrights(7.89%)areallocatedintheirentireytoameriprisefinancialinc.inaccordancewith§22(1)sentence1,no.6incombinationwith§22(1)sentence2wphg.

ColumbiawangerassetmanagementllC,Chicago,usa,notifiedthecompanyon10June2010,correctingitsnotificationofvotingrightson12may2010,thatitsshareofvotingrightsinCtsagfellbelowthe5%thresholdon30april2010andamountedonthelatterdateto4.98%,andthatthesevotingrights(4.98%)areallocatedintheirentiretytoColumbiawangerassetmanagementllCinaccordancewith§22(1)sentence1,no.6wphg.


tremblantpartnersmasterfundlp,Camanabay,grandCayman,Caymanislands,notifiedthecompanythatitsshareofvotingrightsinCtsagexceededthe3%thresholdon4august2010andamountedto3.05%onthelatterdate.

tremblantpartnersltd.,Camanabay,grandCayman,Caymanislands,notifiedthecompanythatitsshareofvotingrightsinCtsagexceededthe3%thresholdon4august2010andamountedonthelatterdateto3.05%,andthatthesevotingrightsareallocatedtotremblantpartnersltd.inaccordancewith§22(1)sentence1,no.2wphg.votingrightsareallocatedtoitbythefollowingshareholderswhosevotingrights inCtsagamount to3%ormore:tremblantpartnersmasterfundl.p.

158


mrbrettbarakett,usa,notifiedthecompanythathisshareofvotingrightsinCtsagfellbelowthe5%thresholdon18may2010andamountedonthelatterdateto4.98%,andthatthesevotingrights(4.98%)areallocatedintheirentiretytomrbrettbarakettinaccordancewith§22(1)sen-tence1,no.6wphgincombinationwith§22(1)sentence2wphg,andalsoinaccordancewith§22(1)sentence1no.1wphg.thevotingrightsallocatedinaccordancewith§22(1)sentence1no.1wphgareheldbythefollowingentitiescontrolledbyhimandwhosevotingrightsinCtsagamountto3%ormore:tremblantholdingsllC.

tremblantpartnersmasterfundlp,Camanabay,grandCayman,Caymanislands,notifiedthecompanythatitsshareofvotingrightsinCtsagfellbelowthe3%thresholdon31december2010andamountedto2.99%onthelatterdate.

tremblantpartnersltd.,Camanabay,grandCayman,Cayman islands, notified the companythat itsshareofvotingrights inCtsagfellbelowthe3%thresholdon31december2010andamountedonthe latterdateto2.99%,andthat thesevotingrights(2.99%)areallocated intheirentiretytotremblantpartnersltd.inaccordancewith§22(1)sentence1,no.2wphg.

inggroepn.v.,amsterdam,thenetherlands,notifiedthecompanythatitsshareofvotingrightsinCtsagexceededthe3%thresholdon11february2011andamountedonthelatterdateto3.09%,andthatthesevotingrightsareallocatedintheirentiretytoinggroepn.v.inaccordancewith§22(2)wphgandalsoinaccordancewith§22(1)sentence1,no.1wphg.

allocatedvotingrightsareheldbythefollowingentitiescontrolledbyinggroepn.v.andwhosevotingrights inCtsagamount to3%ormore: ingverzekeringenn.v.nationale-nederlandennederlandb.v.

ingverzekeringenn.v.,amsterdam,thenetherlands,notifiedthecompanythatitsshareofvot-ingrightsinCtsagexceededthe3%thresholdon11february2011andamountedonthelatterdateto3.09%,andthatthesevotingrightsareallocatedintheirentiretytoingverzekeringenn.v.inaccordancewith§22(2)wphgandalsoinaccordancewith§22(1)sentence1no.1wphg.

allocatedvotingrightsareheldbythefollowingentitiescontrolledbyingverzekeringenn.v.andwhosevotingrightsinCtsagamountto3%ormore:nationale-nederlandennederlandb.v.

nationale-nederlandennederlandb.v., ‘s-gravenhage, thenetherlands,notified thecompanythat its shareof voting rights inCtsagexceeded the3% thresholdon11february2011andamountedonthelatterdateto3.09%,andthatthesevotingrightsareallocatedintheirentiretytonationale-nederlandennederlandb.vinaccordancewith§22(2)wphgandalsoinaccordancewith§22(1)sentence1no.1wphg.

ingreholding(netherlands)b.v.,amsterdam, thenetherlands,notified thecompany that itsshareofvotingrightsinCtsagexceededthe3%thresholdon11february2011andamountedonthe latterdateto3.09%,andthat thesevotingrightsareallocated intheirentiretytoingreholding(netherlands)b.v.inaccordancewith§22(2)wphgandalsoinaccordancewith§22(1)sentence1no.1wphg.

159


ingre(netherlands)n.v.,denhaag,thenetherlands,notifiedthecompanythatitsshareofvot-ingrightsinCtsagexceededthe3%thresholdon11february2011andamountedonthelatterdateto3.09%,andthat2.98%thereofareallocatedtoingre(netherlands)inaccordancewith§22(2)wphg.

inglevensverzekeringretailn.v.,amsterdam, thenetherlands,notified thecompany that itsshareofvotingrightsinCtsagexceededthe3%thresholdon11february2011andamountedonthelatterdateto3.09%,andthat2.94%thereofareallocatedtoinglevensverzekeringretailn.v.,inaccordancewith§22(2)wphg.

ingschadeverzekeringretailn.v.,amsterdam, thenetherlands,notified thecompanythat itsshareofvotingrightsinCtsagexceededthe3%thresholdon11february2011andamountedonthelatterdateto3.09%,andthat3.07%thereofareallocatedtoingschadeverzekeringretailn.v.,inaccordancewith§22(2)wphg.

movirn.v.,nieuwegein, thenetherlands,notifiedthecompanythat itsshareofvotingrights inCtsagexceededthe3%thresholdon11february2011andamountedonthelatterdateto3.09%,andthat3.06%thereofareallocatedtomovirn.v.,inaccordancewith§22(2)wphg.

nationale-nederlandenlevensverzekeringmaatschappijn.v.,rotterdam,thenetherlands,noti-fied the company that its share of voting rights inCtsagexceeded the 3% threshold on 11february2011andamountedonthelatterdateto3.09%,andthat0.59%thereofareallocatedtonationale-nederlandenlevensverzekeringmaatschappijn.v.,inaccordancewith§22(2)wphg.

nationale-nederlandenschadeverzekeringmaatschappijn.v.,denhaag,thenetherlands,noti-fiedthecompanythatitsshareofvotingrightsinCtsagexceededthe3%thresholdon11febru-ary2011andamountedonthelatterdateto3.09%,andthatthesevotingrightsareallocatedintheirentiretytonationale-nederlandenschadeverzekeringmaatschappijn.v.,inaccordancewith§22(2)wphg.

rvslevensverzekeringn.v.,ede,thenetherlands,notifiedthecompanythatitsshareofvotingrightsinCtsagexceededthe3%thresholdon11february2011andamountedonthelatterdateto3.09%,andthat2.80%thereofareallocatedtorvslevensverzekeringn.v.,inaccordancewith§22(2)wphg.

rvsschadeverzekeringn.v.,edegld,thenetherlands,notifiedthecompanythatitsshareofvot-ingrightsinCtsagexceededthe3%thresholdon11february2011andamountedonthelatterdateto3.09%,andthat3.08%thereofareallocatedtorvsschadeverzekeringn.v.,inaccordancewith§22(2)wphg.

mr.klaus-peterschulenberg,bremen,holds50.07%ofthevotingrightsinthecompanyasat31december2010.

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4.8 auditoreXpenses

disclosureofthefeespaidtothecompany’sauditoriswaivedbecausethesedetailsareprovidedinitem18oftheconsolidatedfinancialstatements.

4.9 assuranCebylegalrepresentatives

tothebestofourknowledge,theannualfinancialstatementsgiveatrueandfairviewofthecom-pany’searningsperformance,financialpositionandcashflow, inaccordancewiththeapplicablereportingprinciples,andthat thecombinedmanagementreportpresentsthecourseofbusiness,includingthecompany’sprofitsandsituation,inawaythataccuratelyreflectsactualcircumstancesandtruthfullydescribesthemainopportunitiesandrisksassociatedwiththecompany’sexpecteddevelopment.

bremen,23march2011

Ctseventimag

alexanderruoffvolkerbischoffklaus-peterschulenberg

161


5. auditor’sreport

wehaveauditedtheannualfinancialstatements,comprisingthebalancesheet,theincomestate-mentand thenotes to the financial statements, togetherwith thebookkeepingsystem,and themanagementreport,whichiscombinedwiththegroupmanagementreport,oftheCtseventimaktiengesellschaft,munich, for thebusiness year fromJanuary 1, 2010 todecember 31, 2010.themaintenanceofthebooksandrecordsandthepreparationoftheannualfinancialstatementsandmanagementreportinaccordancewithgermancommerciallawaretheresponsibilityoftheCompany’sboardofmanagingdirectors.ourresponsibilityistoexpressanopinionontheannualfinancialstatements,togetherwiththebookkeepingsystem,andthecombinedmanagementreportbasedonouraudit.

weconductedourauditoftheannualfinancialstatementsinaccordancewith§(article)317hgb(“handelsgesetzbuch”:“germanCommercialCode”)andgermangenerallyacceptedstandardsfortheauditoffinancialstatementspromulgatedbytheinstitutderwirtschaftsprüfer(instituteofpublicauditorsingermany)(idw).thosestandardsrequirethatweplanandperformtheauditsuchthatmisstatementsmateriallyaffectingthepresentationofthenetassets,financialpositionandresultsofoperationsintheannualfinancialstatementsinaccordancewith(german)principlesofproperaccounting and in the combinedmanagement report are detectedwith reasonable assurance.knowledgeof thebusinessactivities and theeconomicand legal environment of theCompanyandexpectationsastopossiblemisstatementsaretakenintoaccountinthedeterminationofauditprocedures.theeffectivenessoftheaccounting-relatedinternalcontrolsystemandtheevidencesupportingthedisclosuresinthebooksandrecords,theannualfinancialstatementsandthecom-binedmanagementreportareexaminedprimarilyonatestbasiswithintheframeworkoftheaudit.theaudit includesassessing theaccountingprinciples usedand significant estimatesmadebytheCompany’sboardofmanagingdirectors,aswellasevaluatingtheoverallpresentationoftheannualfinancialstatementsandcombinedmanagementreport.webelievethatourauditprovidesareasonablebasisforouropinion.

ouraudithasnotledtoanyreservations.

inouropinionbasedonthefindingsofouraudit,theannualfinancialstatementscomplywiththelegal requirementsandgivea trueand fairviewof thenetassets, financialpositionandresultsofoperationsoftheCompanyinaccordancewith(german)principlesofproperaccounting.thecombinedmanagementreport isconsistentwith theannual financialstatementsandasawholeprovidesasuitableviewoftheCompany’spositionandsuitablypresentstheopportunitiesandrisksoffuturedevelopment.

osnabrück,23march2011

pricewaterhouseCoopers

aktiengesellschaftwirtschaftsprüfungsgesellschaft

dr.gregorsolfrianwirtschaftsprüfer


ppa.aloysdeekenwirtschaftsprüfer


162


ContaCt

CtseventimagContrescarpe75a28195brementel.: +49(0)421/3666-0fax: +49(0)421/[email protected]

publishers’notes

publishedby:

Ctseventimag Contrescarpe75a 28195bremen phone.:+49(0)421/3666-0 fax: +49(0)421/3666-290

editorialoffiCe:

engel&Zimmermann Ctseventimag

artwork:

seChsbaelle,bremen

163

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