consolidated management report
TRANSCRIPT
regulations, ORBIS has prepared its consolidated financialstatements according to IAS reporting principles for the firsttime, thus qualifying for exemption in accordance with§ 292a of the German Commercial Code (HGB).
Note: Initial consolidation took place January 1, 2000. Inorder to show how ORBIS has fared, figures have beenincluded from the pro-forma consolidated financial statementsprepared for 1998 and 1999. These statements are voluntaryand unaudited, however they have been included for thesake of comparison.
Financial position and earnings situation
Sales revenueThe sales revenue of the ORBIS Group increased to DEM47.2 million during fiscal 2000, corresponding to an increaseof 11.4 percent as compared to 1999.
The Consulting Unit provided for an overall positive showing,being able to report an increase of 34.7 percent on sales ofDEM 31.9 million, although a major portion of resourceswas tied up in expanding e-business consulting operations,start-up and acquisition costs, and the IPO.This shows that the investments in restructuring the companywere recouped already during the first year. In addition,ORBIS was able to report increased demand for logisticssolutions.
ORBIS undergoes a transformation
Fiscal 2000 was a watershed year for ORBIS and its emplo-yees, marked by a sweeping variety of changes.
Mid 2000 saw the legal restructuring of ORBIS with theobjective of merging all of ORBIS’ administrative functionsin, the newly founded holding company ORBIS AG.
By going public on September 25, 2000, ORBIS AG starteda new chapter in its long, successful history. The result isthat we are now listed on the Frankfurt Stock Exchange’sNeuer Markt. In order to comply with securities market
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ORBIS Bielefeld GmbH, founded in September of 1999,generated revenues of DEM 3.0 million already during itsfirst year of operation, in the end providing for slightlynegative results of ordinary activities.
ORBIS Strategy GmbH, the ORBIS management consultingmember founded in May of 2000, was able to achieve re-venues of DEM 0.1 million during its first year of operation.
By acquiring an interest in ORBIS eMedia GmbH, and in sodoing adding professional Web and multimedia consultingand innovative Internet and multimedia solutions to ORBIS’product and service portfolio, revenues of DEM 0.6 millionare reported from July 2000 upon including this ORBISmember in the group of consolidated companies for the firsttime. A loss of DEM 0.06 million is reported on account ofthe expansion of activities.
ORBIS’ newest member, ORBIS Hamburg GmbH, is a CRMcompetence center offering specialized solutions and servicesfor the consumer goods market, which enables ORBIS tostrengthen its position in this market segment.
In addition, towards the end of 2000, ORBIS AG acquireda 4 percent stake in mysaar.com, a regional Internet portalcompany. The core activities of mysaar.com are business-to-business and business-to-consumer commerce.
Income and cost situationIn the course of ORBIS’ 15-year history, management hassuccessfully mastered growth, providing for a positiveshowing through 1999. For 2000, the operating loss (EBIT)amounts to minus DEM 11.4 million. The increase in sales
The sales revenue of the Solutions Unit fell short ofexpectations, dropping by 18.1 percent to DEM 15.3million. The 2000 showing for the Solutions Unit wasimpacted predominantly by the launch of the new Web-based CRM suite iC Solutions, the successor generationto ORBIS’ successful standard CRM software ORVIS S/3. Itcomes as no surprise that customers take a wait-and-see attitude when faced with a new software generationor major upgrade, waiting for the software to prove itselfin practice. This difficult situation was further aggrava-ted by the fact that, owing to the disappointing fourthquarter for the industry at large, the market environmentwould not allow for any product to immediately gain afoothold. This proved particularly detrimental for ORBIS,as a substantial portion of the iC Solutions license revenuewas to have been generated after the market launch inSeptember.
Affiliated companies of the ORBIS GroupThe revenue figures of the affiliates listed below do notinclude intra-group sales.
The main affiliate of ORBIS AG, the close corporation ORBISGesellschaft für Organisation, Beratung und InnovativesSystemengineering mbH, headquartered in Saarbrücken,Germany, achieved total sales of DEM 43.2 million in 2000.This corresponds to an increase of 1.9 percent as comparedto 1999.
ORBIS America Inc., founded in 1997 in Vienna, Virginia,(in the Washington D.C. metropolitan area), achieved salesof DEM 0.5 million (1999: DEM 0.03 million). ORBIS Americafocuses mainly on e-business consulting.
of 11.4 percent is offset by a rise in costs of 49.3 percentas compared to 1999. The increased costs are the result ofthe growth in the number of employees, the start-up costsof our subsidiaries, and the increased system developmentinvestments in our new Web-based iC Solutions suite andassociated launch costs.
The rise in production costs of 53.5 percent to DEM 42.6million is due to the expansion of consulting operations inboth units, and to the increase in the production costs ofstandard software products as well as for software projectsengineered to order.
Sales costs showed a disproportionate increase of 48.5percent to DEM 10.8 million as compared to 1999. Thesecosts also include the expenses incurred in stepping upmarketing activities for the launching of the new CRMsolution in September of 2000.
Administrative expenses amounted to DEM 7.1 million, thusincreasing by 33.5 percent. The growth strategy introducedduring fiscal 2000 and the IPO, provided for by this newstrategy, made restructuring the organization necessary. Theconsequence of this was that, apart from the capacity-induced increase in ORBIS’ workforce, a higher number ofkey positions had to be filled with highly skilled individuals.These measures were accompanied by extending theaccounting and controlling systems.
The net after-tax loss for the year amounts to minus DEM6.9 million.
Asset and capital structureThe consolidated total assets increased to DEM 95.6 million,thus reflecting an increase of 120.6 percent, primarily attri-butable to the equity infusion from the IPO.
Fixed assets amounted to DEM 30.5 million, primarilyreflecting additions of intangible assets. The additionsessentially extend to the capitalization of the developmentcosts for iC Solutions and iProject, the latter a softwarepackage for the project planning, control and accountingof services.
At DEM 64.5 million, current assets primarily reflect anincrease in accounts receivable due to the expansion ofbusiness, deferred tax assets, and the funds injected by theIPO.
The stockholders’ equity is essentially comprised of thesubscribed stock and the cash infused by the IPO. The costsof the IPO have been set off against the stockholders’ equitypursuant to IAS, thus reducing the additional paid-in capital.The equity ratio amounted to 62.7 percent on December31, 2000.
As of the balance sheet closing date, liabilities had increasedby 35.4 percent to DEM 35.4 million as compared to 1999.This amount primarily reflects the increase in liabilities towardbanks to DEM 14.8 million (December 12, 1999: DEM 10.3million). This increase is mainly attributable to the expansionof business activities in the run-up to the IPO.
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Cash flow statemenThe liquid assets, composed of the cash on hand and depositsat banks, takes into account short-term open account creditand short-term securities in the form of floating rate notes,had increased by DEM 31.5 million by the end of the fiscalyear on December 31, 2000.
The negative cash flow from ordinary activities is mainlydue to the net loss for the year and the substantial changein deferred tax assets.
The cash flow from investment activities is predominantlythe result of capitalizing on internally developed softwareproducts.
The cash flow from financing activities amounting to DEM52.6 million originates from the proceeds of the IPO.
Human resources
The number of employees (excluding trainees) in theGroup amounted to 364 as of December 31, 2000, thiscorresponding to an increase of 49.8 percent as compa-red to 1999 (243).
All the employees of ORBIS AG and affiliates who werepermanently employed as of October 1, 2000, were eligiblefor a stock option plan in connection with the IPO, entitlingthem to exercise their stock options after the two-yearnon-negotiability period. Of the 455,000 option rights,260,950 were issued to employees and management as ofDecember 31, 2000.
The emphasis of human resources was on systematic recruit-ment efforts in order to utilize existing market opportunitiesand to ensure ORBIS’ continued growth. Recruitment ad-vertising was augmented in order to attract highly skilled,dedicated career-minded individuals, experienced consultants,and software developers for the ORBIS team, as well as toenhance ORBIS’ image as an employer in the marketplace.
To this end, ORBIS expanded its contacts to regional insti-tutions of higher learning, general education schools, andother educational establishments. This was achieved by wayof various sponsoring activities, events, talks, provision ofinternships, and increasing the number of positions availableto those completing work-study programs. ORBIS has manyyears of experience in training students in work-study
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programs. The idea being that the students will incorporatethe skills and insight they gain at ORBIS into their graduateprograms.
An IT qualification offensive for arts, legal, natural and socialscience scholars – the first and only one of its kind in Germany– was launched in collaboration with Saarland Universityand three major consulting and software houses located inSaarland. The offensive is designed to enable those in fieldsnot usually associated with information technology to embarkon an IT career.
ORBIS also invested considerable effort and expensein extending and improving its human resources develop-ment processes. For example, a systematic program wassuccessfully introduced and expanded for integrating newemployees. The object of the program is to achieve greateremployee satisfaction and motivation and to ensurelong-term employee retention. The number of trainee andinternship positions in the new IT occupations was in-creased.
Thanks to these initiatives ORBIS has had no problem findingand retaining highly skilled personnel despite the constrainedsituation on the labor market.
Research and development
ORBIS has been successfully developing CRM solutions since1993 and has been able to build on cutting-edge technologiesin the process.
2000 was the year of iC Solutions, the successor generationto ORBIS’ successfully established CRM suite ORVIS S/3.
The new software is characterized by a platform change:iC Solutions is based on the Microsoft Distributed InternetApplication Architecture (MS DNA). The MS DNA architecturecombines the advantages of high scalability, integratabilityin front-office and back-end systems, individualizedextendibility, and the unlimited Web-ability of all compo-nents.
iC Solutions was implemented at Deutsche Post GlobalMail, a subsidiary of Deutsche Post AG, which now featuresone of the first globally functioning Web-based CRM so-lutions. All in all, this prestigious project encompasses a totalof 12 countries on 4 continents with an initial user baseof 150.
2001 will see the continued development of industry con-cepts based on ORBIS’ sophisticated underlying technologyand current general functionality.
ORBIS created the core competencies for its consumergoods/pharma and analytical CRM solutions and con-struction suppliers/property business via targeted work-force development at its Hamburg and Rhein-Ruhr sites.The new release 7.0 of the industry version scheduledfor March 2001, will be further extended in general, andenhanced via the Planning and Database Marketing com-ponents in particular.
Risks
ORBIS believes in making the company as transparent toshareholders as possible, and consequently, would like tosay a few words about factors impacting future businessdevelopment. In order to fulfill legal requirements, ORBIS
has introduced a risk management system. The followingimponderables were identified and taken into account inthe corporate planning and control:
Generally speaking, every company has to consider riskslike product defects, bad debts, and difficulties in locatingand retaining personnel.
The challenges specific to our industry extend to maintainingsustained innovative capability and having access to accuratemarket and customer requirement analyses, to name justtwo. Market analyses also pose the risk of the CRM marketnot behaving as forecasted. For example, the expectedwidespread breakthrough of CRM software might be dela-yed, and in the process negatively impacting the demandfor iC Solutions.
Another challenge is apparent in SAP‘s launch of a competitorWeb-based CRM solution. Yet this is juxtaposed by the highpotential offered by the CRM market, meaning that morethan one vendor can successfully position themselves.
With the restructuring of ORBIS, management initiated themeasures required to optimally meet these challenges headon.
Significant events after the closing of the fiscal year
Effective as of October 26, 2000, ORBIS AG acquired a 55-percent stake in ORBIS communications GmbH. ORBIScommunications GmbH specializes in e-learning, i.e. thedevelopment, marketing and sale of the Web-basedNetCoach learning software. Since the entry in theCommercial Register had not been completed on the balance
sheet closing date, ORBIS communications GmbH will notbe included in the consolidated financial accounts until fiscal2001.
ORBIS — mySAP.com Alliance Partner Service MemberHaving proved its e-business and mySAP.com expertise,ORBIS satisfied SAP’s exacting criteria, thus qualifying foran SAP partnership at the end of last year. Consequently,ORBIS became one of the first companies to be awardedmySAP.com Alliance Partner Service status by SAP at thebeginning of 2001.What does the new partnership mean?For one, it is a culmination of the successful consulting part-nership of many years’ standing, and a partnership built ontrust. For another, it also means that SAP and ORBIS will becollaborating even more intensively in implementing theirjoint mySAP.com strategy.
Multi-million DEM contract from one of Europe’s largestPCB manufacturersThis past January ORBIS announced one of largest singlecontracts in the company’s history. This major contract,awarded by Ruwel, a leading European printed circuit boardmanufacturer, is worth DEM 5 million. It covers the imple-mentation of the mySAP.com business software at varioussites in Germany and France.
Outlook
IT — A growth marketThe market researchers Gartner Group Inc. project thatthe world-wide market volume for IT services will growfrom its 1999 level of USD 605 billion to USD 1,300 billionin 2004. According to AMR Research, the global CRMmarket will grow by an average of 50 percent yearly until
2003, the German CRM market numbering among thefastest growing markets in Europe. According to estimatesof Frost & Sullivan, the west European market will growfrom its 1999 level of USD 0.98 billion to USD 6.81 billionin 2005.
This strong growth in the software industry is expectedto be accompanied by hefty growth in the service sector,with the convergence of consulting, multimedia andIT services continuing to increase. Consequently, in the nearfuture a company’s very existence will hinge on not onlybeing able to offer a product, but an all-in-one solutioninto the bargain. ORBIS paved the way for the future earlyon, and is poised to meet it head on. Thanks to our e-busi-ness consulting and Web-based software offerings combinedwith an intelligent partner strategy, we are able to fully availourselves of the opportunities offered by this market.
ORBIS’ designated goal for 2001 is to achieve greater marketpenetration – also at the European level – and to expand itsrange of products and services. To accomplish this, theprimary aim is to develop the market by leveraging ORBIS’own marketing, sales and consulting capabilities by way ofstrategic partnerships.
In the Consulting Unit we are proceeding with continuedabove-average growth of the consulting business. This unitis expected to continue providing for a very positive showing,particularly in view of the expansion of ORBIS’ consultingofferings to incorporate a holistic e-business strategy andon account of the companies newly founded and majoritystakes acquired specifically for this purpose.
For the Solutions Unit we expect demand for our Web-based iC Solutions suite to increase, being enhanced viaadditional critical features in release 7.0 (release scheduledfor March 2001). We will achieve greater market penetrationthrough special industry solutions, e.g. for the retail andconsumer goods segments.
We would like to conclude by saying that our stated goalis sustained profitability and corporate value growth andthat we are determined to bounce back into the black in2001.
Note 12/31/2000 12/31/1999* 12/31/1998*
1. Sales revenue (20) 47,236 42,408 26,396
2. Production costs of services
provided to generate
sales revenues (21) -42,590 -27,754 -18,563
3. Gross earnings 4,646 14,654 7,833
4. Distribution expenses (22) -10,772 -7,256 -3,800
5. General administrative expenses (23) -7,096 -5,315 -3,368
6. Other operating income (24) 1,789 1,014 566
7. Other operating expenses 0 -196 -96
8. Other interest and similar income (25) 508 90 15
9. Amortization of financial assets (25) -25 0 0
10. Interest and similar expenses (25) -788 -498 -304
11. Results of ordinary activities -11,738 2,493 846
12. Income taxes (26) 4,831 -1,945 -943
13. Other taxes (27) -70 -29 -16
14. Profit share of silent partners 0 0 -52
15. Net income/loss before minority interest -6,977 519 -165
16. Minority interest in income 40 0 0
17. Net income/loss -6,937 519 -165
f o r t h e y e a r s 1 9 9 8 t o 2 0 0 0i n D E M ( 0 0 0 )
* ORBIS AG, Saarbrücken, Germany, prepared consolidated financial statements for the first time for fiscal year 2000. The company prepared pro-forma consolidated financial statements for the 1999 and 1998 fiscal years based on the requirements of the International Accounting Standards Committee. In contrast to the actual relationships, these pro-forma consolidated statements were prepared based on the relationships existing on January 1, 2000.
for the year 2000in DEM (000)
ASSETS Note 12/31/2000 01/01/2000
A. FIXED ASSETS
I. Intangible assets (1)
1. Development costs 7,583 4,862
2. Commercial trademarks and licenses 1,268 110
3. Goodwill 9,646 10,572
18,497 15,544
II. Tangible assets (2)
1. Property and buildings 9,558 9,301
2. Other assets, operating and office equipment 2,404 1,343
11,962 10,644
III. Financial assets (3)
1. Interests in associated companies 38 0
2. Participations 41 0
79 0
Total fixed assets 30,538 26,188
B. CURRENT ASSETS
I. Inventories (4)
1. Work-in-progress 422 220
2. Completed services 64 242
486 462
II. Receivables and other assets (5)
1. Accounts receivable 15,158 13,172
2. Other assets 1,917 1,489
3. Deferred taxes (6) 9,800 174
26,876 14,835
III. Short-term securities (7) 15,611 0
IV. Cash, deposits in banks (8) 21,544 1,540
Total current assets 64,517 16,837
C. ACCRUALS AND DEFERRALS (9) 543 314
95,598 43,340
LIABILITIES and EQUITY Note 12/31/2000 01/01/2000
A. EQUIT Y
I. Subscribed capital (10) 17,798 13,691
II. Retained earnings (11) 49,252 0
III. Difference in equity due to currency translation (12) -48 0
IV. Profit/loss carried forward (13) -103 995
V. Net income/loss -6,937 0
VI. Adjustment for interests of other stockholders (14) 3 3
59,964 14,689
B. RESERVES
1. Pension reserves (15) 2,069 1,757
2. Reserves for taxes (17) 1,021 1,074
3. Deferred taxes (16) 3,666 2,356
4. Other reserves (17) 5,849 6,294
12,604 11,481
C. LIABILITIES (18)
1. Liabilities to banks 14,764 10,347
2. Advance payments on orders 355 1,798
3. Accounts payable 5,281 2,115
4. Other liabilities 2,216 2,442
22,617 16,701
D. DEFERRED LIABILITIES (19) 413 469
95,598 43,340
1. Cash flow from ordinary activitiesNet income/loss -6,937
Adjustments
· Amortization/depreciation of tangible assets and intangible assets 5,103
· Change in deferred taxes -8,316
· Change in pension reserves 311
Total adjustments -2,902
Subtotal cash flow -9,839
· Change in inventories -24
· Change in receivables and other assets -2,415
· Change in deferred assets -229
· Change in other reserves -498
· Change in liabilities (excluding banks) 1,498
· Change in accrued liabilities -56
Total adjustments -1,724
Cash deficit from ordinary activities -11,563
2. Cash flow from investment activities· Additions to intangible assets and tangible assets -9,472
· Reductions in tangible and financial asset to net book values (balanced) 20
Cash deficit from investment activities -9,452
3. Cash flow from financing activities· Change in liabilities from loans 309
· Change in liabilities to stockholders 0
· Capital increase 53,359
· Dividend payment -1,098
Cash flow from financing activities 52,570
Effect of currency exchange rate changes on liquid assets -48
Net cash flow/deficit 31,507
Liquid assets at the beginning of the fiscal year 1,005
Liquid assets at the end of the fiscal year 32,512
Change in liquid assets 31,507
4. Composition of liquid assets at the end of the fiscal year· Cash and deposits in banks 21,544
· Liabilities to banks from open account credits -4,643
· Short-term securities 15,611
Liquid assets at the end of the fiscal year 32,512
for the year 2000in DEM (000)
The obligation under commercial law to prepare consolidatedfinancial statements arose for the first time for fiscal year2000 due to the listing of ORBIS AG stock on the NeuerMarkt during the fiscal year. Therefore § 293 of the GermanCommercial Code regarding exemption based on size is nolonger applicable.
Preparation of the consolidated financial statements basedon IAS and the consolidated management report provideexemption in accordance with § 292a of the GermanCommercial Code.
I . G e n e ra l i n f o r m a t i o n
ORBIS AG, Saarbrücken, has prepared consolidated financialstatements for the first time for the fiscal year 2000. Thesestatements were prepared in accordance with all InternationalAccounting Standards (IAS). Furthermore, where permitted,individual IAS were applied in advance of their effectivedate. The consolidated financial statements were notorganized in accordance with the German Commercial Code.
Notes to the co n so l id atedf inanci a l s ta tem ent so f O R B I S A G f o r f i s c a l y e a r 2 0 0 0 i n a c c o rd a n c e w i t h I A S
Scope of consolidation
The following subsidiaries are included and have been fully consolidated in the financial statements of ORBIS AG:
The following participations have been included in the consolidated financial statements at acquisition cost:
Percentage of partici-
Name Location pation/voting rights
ORBIS Gesellschaft für Organisation, Beratung Saarbrücken (Germany) 100.0 %
und Innovatives Systemengineering mbH
ORBIS America Inc. Vienna, Virginia (USA) 100.0 %
ORBIS Strategy GmbH Saarbrücken (Germany) 90.1 %
ORBIS Hamburg GmbH Hamburg (Germany) 80.0 %
ORBIS Bielefeld GmbH Bielefeld (Germany) 74.9 %
ORBIS eMedia GmbH Saarbrücken (Germany) 55.0 %
Percentage of partici-
Name Location pation/voting rights
ORBIS communications GmbH Saarbrücken (Germany) 55.0 %
mysaar.com Saarbrücken (Germany) 4.0 %
Betreibergesellschaft Verwaltungs GmbH
mysaar.com Saarbrücken (Germany) 4.0 %
Betreibergesellschaft GmbH & Co.KG
During fiscal year 2000, ORBIS AG acquired stock in ORBIScommunications GmbH (formerly SaNET GmbH), Saar-brücken, Germany, by means of a take-over as well as acapital increase through cash. The registration in theCommercial Register necessary to complete the capitalincrease did not occur during the fiscal year, nor as of thepreparation of the consolidated statements.
In fiscal year 2000, mysaar.com BetreibergesellschaftVerwaltungs GmbH, Saarbrücken, Germany, was founded.ORBIS AG assumed an initial investment in the amount ofEUR 1,000.
Following the founding of mysaar.com BetreibergesellschaftGmbH & Co. KG, Saarbrücken, Germany, ORBIS AG hasassumed a capital contribution of EUR 20,000 as a limitedpartner.
Because ORBIS AG does not have the ability to exercise amaterial influence on these companies within the meaningof IAS 28, these companies have been included in thefinancial statements as acquisition cost.
Currency translation principles
Reporting currency
The balance sheet, income statement, statement of chan-ges in equity, schedule of assets, as well as the remarkson equity capital were prepared using DEM (Germanmarks).
Currency translation of the consolidated subsidiaries
Currency translation of the US subsidiary is made using thefunctional currency principle. Based on the economic inde-pendence of the US subsidiary, US dollars (USD) are usedas the functional currency. Conversion is made using themodified closing-rate method. Thus, assets and liabilities areconverted using the closing-date rate (average spot rate),income statement accounts are converted using the averagerate, and net income is converted at the closing-date rate.Equity is valued at the historical rate as of the time of initialconsolidation.
The difference arising from currency translation is balancedagainst equity without regard to earnings in accordancewith IAS 21.30 and is reported separately under equity. Trueremaining differences from currency translation of debtconsolidation affect the consolidated income.
Consolidation principles
The annual financial statements of the companies includedin the consolidated statements were prepared in accordancewith the local accounting regulations in effect in their res-pective countries. The individual statements were convertedto IAS to prepare the consolidated statements as of December31, 2000. With respect to the financial statements of ORBISAG and ORBIS Gesellschaft für Organisation, Beratung undInnovatives Systemengineering mbH, material differences(totaling DEM 14,918,000) arose when compared topreparation according to the German Commercial Code,especially in the areas of intangible assets, depreciation ofbuildings, pension obligations, costs of the IPO, and deferredtax assets. Due to the immateriality arising from theconversion from US-GAAP to IAS, the differences were nottaken into account with regard to the financial statementsof ORBIS America Inc. Differences in earnings of the othernational subsidiaries arose from the conversion of deferredtaxes to IAS.
Consolidation of the companies to IAS was made as follows:
During capital consolidation using the purchase method inaccordance with IAS 22, the book value of the investmentof the parent company is balanced against the equity of thesubsidiary. The effective date of initial consolidation of ORBISAmerica Inc., of Vienna, VA (USA), and ORBIS BielefeldGmbH, of Bielefeld, Germany, is January 1, 2000. The otherfully consolidated companies are included in the consolidatedstatements as of the date that economic control was acquired.
DEM/USD
Closing-date rate 2.1026
Average rate 2.1187
After allocation to silent reserves and encumbrances,differences are reported as goodwill, which is amortizedover 10 years using the straight-line method.
All receivables and liabilities between consolidated companieswere balanced against each other during consolidation ofliabilities.
Revenues and expenses arising from intra-group transactionswere eliminated during the consolidation of revenues andexpenses.
There were no material intermediate earnings from internalgroup deliveries of assets or inventories.
II. Information regarding individual balancesheet accounts
Assets
The consolidated asset schedule for fiscal year 2000 isincluded in the appendix.
Intangible assets (1)
Goodwill reported under intangible assets is a result of thecapital consolidation of ORBIS Gesellschaft für Organisation,Beratung und Innovatives Systemengineering mbH, ORBISAmerica Inc., ORBIS Bielefeld GmbH, and ORBIS eMediaGmbH. Goodwill is amortized over 10 years using thestraight-line method. Extraordinary amortization was nottaken during the fiscal year.
The account, concessions, commercial trademarks and simi-lar rights, as well as licenses for such rights, primarily con-tain software and commercial trademarks acquired for consi-deration. Valuation is made at the historical acquisition costless regular amortization. Regular amortization of purchasedsoftware and trademarks is made based on the expecteduseful life of 3 years using the straight-line method.
In contrast to the German financial statements, in which,under § 248 section 2 of the German Commercial Code,internally developed intangible assets may not be capitalized,
in the IAS statements, the internally developed CRMsoftware products, ORVIS, iC Solutions and iProject,which are marketed under long-term licenses, are capita-lized as intangible assets. Valuation of these softwareproducts is made in accordance with IAS 38 using thedevelopment costs incurred after such time as thereis evidence of the future technical feasibility andmarketability of the products and a value can be assignedto them. The development and production costs capitalizedare composed of the direct costs (primarily personnel costs),as well as a proportionate share of overhead. Intereston outside capital is not included. Furthermore, expensesincurred after the product is completed are capitalizedinsofar as it is probable that further development of theproduct will result in a benefit which exceeds the product’soriginal capabilities (e.g. expanding the software’sfunctionality). The software products, iC Solutions andiProject will be amortized over an expected useful life of5 years using the straight-line method after they arecompleted. ORVIS is already completed and is beingamortized on a straight-line basis over 5 years. Theamortization period is regularly reviewed and changed asnecessary. No extraordinary amortization has been taken.
Tangible assets (2)
Tangible assets are composed of property and buildingsacquired for consideration, as well as operating and officeequipment. These assets are reported at the historicalacquisition costs, and where applicable, are reduced byregular depreciation. Insofar as capital investment creditshave been granted, they are set off against the historicalacquisition cost without effecting earnings.
Tangible assets are depreciated on a straight-line basisover the expected useful life of the asset (property andbuildings: 40 years; operating and office equipment:3 – 10 years). The economic viability of the assets is re-viewed. Extraordinary depreciation has not been taken.For additions of chattel property during the first half ofthe year, depreciation is taken for the full year and de-preciation is taken for one half year for additions in thesecond half of the year. Chattel property with an acquisitioncost of up to DEM 800 is written off in full during the yearof acquisition. Application of this principle has no materialeffect on the consolidated results.
Receivables and other assets (5)
Receivables and other assets were valued at the lower end of book value or net realizable value, taking all recognizablerisks into account. Towards this end, reasonable allowances were made for doubtful accounts and non-collectible accountswere written off. Additional allowances were made to cover interest rate and credit loss risks in the amount of 2 percentof the unadjusted balance of accounts receivable.
With regard to the depreciation of buildings, the expecteduseful life was adjusted to 40 years for the consolidatedstatements, as compared to the German financial statements.
Simplification rules allowed under German tax law weremaintained in accordance with IAS 4 since they have onlyan ancillary effect on earnings.
Financial assets (3)
Reported below are investments in non-consolidated affiliated companies and participants.
Name and location of company in DEM (000)
ORBIS communications GmbH, Saarbrücken 38
mysaar.com Betreibergesellschaft GmbH & Co.KG, Saarbrücken 39
mysaar.com Betreibergesellschaft Verwaltungs GmbH, Saarbrücken 2
Because ORBIS AG does not have the ability to exercise a material influence on these companies within the meaningof IAS 28, valuation of the participations has been made using the acquisition cost method.
Inventories (4)
Inventories are completed services not yet invoiced forsoftware consulting and incomplete services in connectionwith CRM implementation. Inventories are valued at thelower end of production cost or net realizable value. Produc-tion costs consist mainly of wages and salaries, and otherpersonnel costs, which are directly attributable to the deliveryof services. The lower net realizable value is determinedusing the retrograde method (loss-free method).
in DEM (000)
Work-in-progress 422
Completed services 64
Total 486
Inventories are composed of the following items:
Receivables and other assets in DEM (000)
Accounts receivable 15,158
Other assets 1,917
Total 17,075
Receivables and other assets are composed of the following items:
All receivables and other assets have maturities of up to one year.
Included in other assets are receivables in the amount of DEM 123,000 from shareholders of ORBIS AG as well asfrom minority shareholders of ORBIS eMedia GmbH.
Deferred tax assets (6)
Deferred taxes result primarily from deviations in valuationsbetween the tax value and the value per IAS, as well as theexpected future offset of taxable loss carry-forwards.
Due to temporary deviations, deferred taxes result in eithera lower value for assets or a higher value for liabilities in IASstatements as compared to tax statements. Temporarydeviations arose this fiscal year in the reporting of pensionreserves.
Deferred tax assets are composed of the following items:
Short term securities (7)
Exchange-listed floating rate notes are included in currentassets, which were written down to net realizable value asof the closing date in accordance with IAS 32. The totalwrite-off for the fiscal year amounted to DEM 25,000.
Liquid assets (8)
Liquid assets are placed at nominal value. Liquid assets inforeign currencies are converted as of the closing date.
Accruals and deferrals (9)
Accruals and deferrals primarily consist of maintenance costs,vehicle tax, insurance premiums, and discounts on accountspayable.
Discounts are reduced annually by regular amortization overthe life of the underlying liability. Accrued discounts in theamount of DEM 57,000 have a remaining life of more thanone year. The remaining accruals and deferrals (DEM 486,000)will likely be used in 2001.
Deferred tax assets from in DEM (000)
Loss carry-forwards 9,558
Pensions 242
Total 9,800
Equity
The registered capital of ORBIS AG is reported as subscribed capital. Subscribed capital in the amount of EUR 9,100,000is divided into 9,100,000 no-par shares, each with an accounting share of EUR 1 of the registered capital of the company.
The individual components of equity capital as well as its development are presented in the following statement ofchanges in equity (figures in DEM thousand):
Equity at the beginning of the fiscal year 14,689
Subscribed capital
01/01/2000 13,691
Capital increase 4,107
12/31/2000 17,798
Additional paid-in capital
01/01/2000 0
Premium on capital increase 53,394
Allocation of IPO costs – 4,142
12/31/2000 49,252
Profit/loss carried forward
01/01/2000 995
Dividend – 1,098
12/31/2000 – 103
Change in equity due to currency translation
01/01/2000 0
Change – 48
12/31/2000 – 48
Net loss – 6,937
Adjustments for shares of other stockholders
01/01/2000 3
Change 0
12/31/2000 3
Equity at the end of the fiscal year 59,964
Subscribed capital (10)
At the shareholders’ meeting of ORBIS Holding GmbH onMay 16, 2000, it was decided to transform the legal formof ORBIS Holding GmbH into the stock corporation(Aktiengesellschaft) ORBIS AG by means of the provisionsof § 1900 ff of the German Transformation Act (Um-wandlungsgesetz). The transformation was recorded in theCommercial Register on July 20, 2000. At the beginning ofthe fiscal year therefore, the authorized capital of ORBISHolding GmbH was transferred to ORBIS AG at the time ofthe transformation of ORBIS Holding GmbH. Authorizedcapital at the beginning of the fiscal year totaled EUR 7,000.
The participants of the extraordinary shareholders’ meetingof August 16, 2000, agreed to a capital increase in returnfor cash of EUR 21,000,000. The execution of the capitalincrease was recorded in the Commercial Register onSeptember 20, 2000. Authorized capital in the amount ofEUR 4,550,000 for the issuance of new common stock inreturn for the investment of cash or assets was also approved.The authorization of the Board of Management to carry outthe capital increase with the approval of the SupervisoryBoard expires on August 16, 2005. The resolution wasrecorded in the Commercial Register on November 10, 2000.
Furthermore, the annual shareholders’ meeting of August16, 2000, approved a stock option plan and set conditionalcapital in the amount of EUR 455,000 for the redemptionof these stock options through the issuance of no-par bearershares. The conditional capital was recorded in the Com-mercial Register on September 13, 2000.
Additional paid-in capital (11)
Additional paid-in capital shown is a result of a premium ofDEM 53,394,000 received in the course of the cash capitalincrease, reduced by the cost of the initial public offering ofDEM 4,142,000 after the deduction of the tax credit. Thetax credit of DEM 3,379,000 of the total cost of the IPO ofDEM 7,521,000 is reported under deferred tax assets.
Difference in equity due to currency translation (12)
The difference in equity due to currency translation was de-rived using the modified closing-date method. The differencearises from the translation of the income statement accountsof ORBIS America Inc. and the average exchange rate ofthe equity of ORBIS America Inc. and the historical rate asof the initial consolidation, for one, and the closing daterate, for another.
Loss carry-forward (13)
The loss carry-forward in the amount of DEM 103,000 is aresult of the retroactive adjustment to IAS for depreciationof buildings and amortization of pension reserves for previousyears.
Adjustment for interest of other stockholders (14)
The shares of other stockholders item includes the equityshare attributable to minority shareholders of subsidiariesincluded in the capital consolidation.
Pension reserves (15)
Members of the Board of Management of ORBIS AG receive a pension after retirement. The pension is a defined benefitplan and is financed by reserves. The benefits provided by ORBIS AG are based on the length of service and compensationof the board members. In fiscal year 2000, the defined-benefit plan resulted in expenses of DEM 311,000, which, exceptfor the interest expense, are contained in expenses for the functional division. These expenses are composed of thefollowing:
in DEM (000)
Expense of pension benefits earned during the fiscal year 156
Interest expense 143
Amortization of actuarial losses 12
Total 311
Pension reserves for defined-benefit plans are reported inaccordance with IAS 19 using the projected unit creditmethod. This method evaluates future liabilities using actuarialprocesses to conservatively estimate the size of relevantfactors. The expected pension benefits, which are consideredto be variable after retirement, are distributed over the totalperiod of employment of the board members.
The pension liabilities financed by reserves, as calculated using the premises given above, are as follows:
in DEM (000)
Present value of projected benefit obligations 3,195
Adjustment due to unrealized actuarial gains/losses – 1,126
Net obligation for accounting purposes 2,069
In addition to assumptions concerning life expectancy, thefollowing parameters are also used in calculating actuarialvalues of pension benefits:
Actuarial gains and losses (e.g. due to a difference in income trends as compared to accounting assumptions) result inadjustments between the actuarial project credit benefit and the reserve for accounting purposes. These adjustmentsare not immediately recognized as a charge to earnings but rather in accordance with IAS 19, and are recorded over thefuture average remaining term of service of the beneficiary and charged against earnings.
Actuarial interest rate 6.00 %
Expected salary increase 2.00 %
Expected pension increase 1.50 %
These pension obligations developed as follows:
in DEM (000)
Book value of net obligations at the beginning of the year 1,757
Pension expense 312
Pension payments 0
Book value of net obligations at the end of the year 2,069
Deferred tax reserves (16)
Deferred tax reserves arise from the capitalization of development costs and the increased depreciation period for buildingsunder IAS as compared to tax accounting. Deferred tax reserves must also be considered during the consolidation ofliabilities due to actual differences in offsetting accounts. Deferred tax reserves are composed of the following:
Deferred tax reserves from in DEM (000)
Development costs 3,413
Depreciation of buildings 148
Consolidation of debts 105
Total 3,666
in DEM (000) 01/01/2000 Re-classification Utilized Written off Additions 12/31/2000
Tax reserves 1,074 – – 398 – 345 1,021
Reserves forpersonnel 4,285 – – 4,048 – 3,168 3,405
Reserves forservices 1,817 – 1,049 – 9 – 17 776
Other reserves 192 1,049 – 1,200 – 32 1,659 1,668
Other reserves (17)
The formation and valuation of other reserves has been made in agreement with IAS 37. They are expected to be utilizedwithin one year. They have not been discounted due to negligibility. Other reserves are composed of the following:
Tax reserves include reserves for corporate taxes and occupational taxes from previous years. The addition during thefiscal year was for taxes on the purchase of land.
Liabilities (18)
Liabilities are recorded at the higher end of book value or the repayment amount. They are composed of the following:
Liabilities to banks are fully secured through liens on land, debt assignments, pledges, or surety agreements.
Deferred liabilities (19)
Deferred liabilities are primarily composed of accrued revenue from software maintenance contracts as well as interestrate subsidies.
Other financial liabilities/contingent liabilities
As of the balance sheet date, other financial liabilities arising from rental and leasing contracts existed in the followingamounts:
Contingent liabilities include the obligation to provide additional contributions to capital in the amount of EUR 180,000to mysaar.com Betreibergesellschaft GmbH & Co. KG.
in DEM (000)
Liabilities to banks 14,764
with a maturity of up to one year 6,209with a maturity between one and five years 4,081with a maturity of more than five years 4,474
Advance payments on orders 355
with a maturity of up to one year 355
Accounts payable 5,281
with a maturity of up to one year 5,087 with a maturity of between one and five years 194
Other liabilities 2,216
with a maturity of up to one year 2,216 from taxes 701 from social security 841
2001 2002 2003 2004 Subsequent years
DEM (000) DEM (000) DEM (000) DEM (000) DEM (000)
2,414 1,928 1,185 459 315
The consolidated income statement for fiscal year 2000 wasprepared using the cost-of-sales method and classifiedaccording to § 275 section 3 of the German CommercialCode.
Sales revenue (20)
The breakdown and development of sales revenues byproduct division may be found in Segment Reports(Section VI).
Production costs of services provided to generate sales
revenues (21)
Services provided are reported in this item. In addition todirectly attributable costs such as personnel and materialsexpenses, it also contains overhead costs including theamortization of capitalized development costs of internallyproduced software. Furthermore, development costs ofmaintenance operations that generated revenue are alsoreported.
Distribution expenses (22)
Expenses of the distribution organization, advertising andmarket development, as well as write-offs of receivables,are reported here.
Administrative expenses (23)
Personnel and materials costs of administrative offices areincluded here. Additionally, the amortization of goodwillarising from capital consolidation is also reported under thisitem.
Other operating income (24)
Other operating income is composed of the following:
Other income is essentially composed of income from cost
transfers to third parties and income from the company cafeteria.
Financial income (25)
Financial income is composed of the following individualitems:
The floating rate notes reported under current assets werewritten down in the amount of DEM 25,000 to their marketvalue as of the closing date.
in DEM (000)
Income from vehicle payments in kind 916
Income from interest rate subsidies 125
Income from insurance reimbursements 71
Income from the elimination of reserves 18
Income from differences in currency rates 8
Other income 651
Total 1,789
in DEM (000)
Adjustments to short-termcurrent asset securities – 25
Other interest and similar income 508
Interest and similar expenses – 788
Total – 305
III. Notes concerning individual incomestatement accounts
Income taxes (26)
Income taxes are composed of the following:
in DEM (000)
Current income taxes – 27
Deferred taxes 4,858
Total 4,831
Detailed information concerning deferred tax assets andliabilities is contained in Section II. An anticipated incometax rate of 45 percent was used as a basis for calculatingdeferred taxes.
in DEM (000)
Results of ordinary activities – 11,738
Income taxes 4,831
Actual income tax rate 41 %
The actual income tax rate is given below.
in DEM (000)
Results of ordinary activities -11,738
Non-taxable earnings as a result of consolidation 810
Allowable losses from previous periods -180
Non-allowable losses of ORBIS Inc. 385
Taxable basis for the calculation of the anticipated tax rate -10,723
Income taxes 4,831
Anticipated income tax rate 45 %
The anticipated income tax rate is calculated using the following modifications:
Other taxes (27)
Other taxes primarily include vehicle taxes, as well as taxes on the French operating facilities of ORBIS Gesellschaft fürOrganisation, Beratung und Innovatives Systemengineering mbH, Saarbrücken.
Materials expenses
in DEM (000)
Expenses for raw materials and purchased goods 268
Expenses for services purchased 6,069
Total 6,337
Expenses for services purchased are composed exclusively of external programming work and similar services.
Personnel expenses
in DEM (000)
Wages and salaries 27,891
Social insurance and pension expenses 5,301of which for pensions 319
Total 33,192
The ORBIS Group had an average of 310 employees during the fiscal year.
Research and development costs
Total R&D expenses for fiscal year 2000 were DEM 1,192,000.
Write-downs
There were no reductions in the value of assets, which would have led to an extraordinary write-down to the recoverableamount under IAS 36.
IV. Information regarding the cash flow statement
The consolidated cash flow statement has been preparedbased on the guidelines of the German Auditors’ Institute(HFA 1/1995), which correspond to the requirements ofIAS 7 Cash Flow Statements. Accordingly, payment streamsfrom operational, investment, and financing activities arereported separately. The liquidity reported in the cash flowstatement includes cash, bank deposits at banks, short-termsecurities that can be redeemed at any time, and short-termbank liabilities (open account credits).
The indirect method was chosen to report cash flow fromcurrent operating activities. The negative cash flow fromcurrent operating activities is primarily a result of the formationof deferred tax assets.
Cash flow from investment activities arises from the paymentsreceived from the sale and purchase of assets.
The positive cash flow from financing activities in fiscal year2000 was primarily a result of the cash capital increaseduring the fiscal year. The inflow was reduced by the costof the initial public offering allocated to retained earnings.
The adjustments for currency translation reported separatelywere the result of the currency translation of the US subsidiaryincluded in the consolidated financial statements.
Liquid assets at year’s end comprise cash on hand anddeposits at banks, taking short-term open account creditinto consideration, as well as short-term securities in theform of floating rate notes. The securities are exchangelisted and therefore considered liquid.
V. Information regarding the corporate boards of ORBIS AG
The following persons were on the Board of Management
as of December 31, 2000:
◆ Klaus Kieren (Spokesman), Überherrn, Germany◆ Thomas Gard, Urexweiler, Germany◆ Stefan Mailänder, Eppelborn, Germany◆ Ulrich Thiele, Saarbrücken, Germany
The total remuneration of the Board of Management infiscal year 2000 was DEM 1,664,000. At the time of theinitial public offering, members of the Board of Managementcontinued to hold 2,772,000 shares of stock in the company.22,750 subscription rights from the stock option plan havebeen reserved for the Board of Management.
The Supervisory Board is composed of:
◆ Prof. Wolf-Jürgen Schieffer (Chairman),Dipl.-Math., Professor, Völklingen, Germany
◆ Prof. Werner Koetz (Deputy Chairman),Dipl.-Math., Professor, St. Ingbert, Germany
◆ Dr. Uwe Spörl, Dipl.-Math.,Management Board Walter AG, Wimsheim, Germany
In fiscal year 2000, DEM 20,000 was set aside for remunera-tion for the Supervisory Board. The members of the Super-visory Board do not belong to any Supervisory Boards ofother companies. The members of the Supervisory Boardhold 1,386,000 shares of ORBIS AG.
In accordance with IAS 14, individual items from the annualfinancial statements are segmented according to businessdivisions, in which the classification is based on internalreporting requirements.
No segment reporting by geographical regions was preparedsince the activities of the ORBIS Group were almost entirelyin Germany.
The activities of the ORBIS Group are divided into theConsulting and Solutions Units.
In the Consulting Unit, ORBIS has know-how in strategy,management, business process, and multimedia consulting.This portfolio enables ORBIS to develop and implementholistic e-business solutions. A major consulting activity ofthe companies within the ORBIS Group concerns theintroduction of SAP products as an SAP Consulting Partner.
The Solutions Unit develops, markets, and implements CRMsoftware, as well as e-business solutions and offers additionalservices in customization, support, and training.
The segment data was prepared as follows:
◆ Service transfers between segments did not occur.
◆ Segment earnings include all operating revenues corre-sponding to the segment’s assets and liabilities. Unallocatedoperating expenses comprise, among other items, amor-tization of goodwill as well as general administrativeexpenses that are related to the company as a whole.
◆ Segment assets comprise all operating assets that areused by a business division, and consist predominantlyof intangible assets, tangible assets, receivables andinventories. Insofar as common assets could not be directlyallocated to the segments, the book value was allocatedon a reasonable basis.
◆ Segment liabilities comprise all operating liabilities andconsist predominantly of pension liabilities, other reserves,advance payments, and accounts payable.
VI. Information regarding segment reporting
Segment report by business division for 2000
in DEM (000) Other
Consulting Solutions areas Consolidated
External revenues 31,884 15,352 47,236Inter-segment revenues 0
Total revenues 31,884 15,352 47,236
Segment earnings 4,334 – 9,400 – 5,066
Unallocated operating expenses – 6,437Operating earnings – 11,503Other financial earnings – 305Income taxes 4,831Minority share of earnings 40
Earnings for the period – 6,937
Segment assets 13,752 18,630 32,382Unallocated common assets 63,152
Consolidated assets 95,534
Segment liabilities 6,569 5,244 11,813Unallocated liabilities 83,721
Consolidated liabilities 95,534
Additions to intangible and tangible assets 1,623 7,387 519
Amortization/depreciation 760 3,123 1,220
Non-cash expenses other thanamortization/depreciation 3,488 3,266 5,850
Earnings per share is calculated in accordance with IAS 33by dividing the consolidated earnings for the period by theaverage number of shares.
Because the 2,100,000 shares of bearer stock issued as aresult of the capital increase during the fiscal year have fullprofit participation rights for fiscal year 2000, the undilutednumber of shares for determining earnings per share equals9,100,000 shares.
The subscription rights issued as a result of the stock optionplan of August, 16, 2000, lead to diluted earnings per shareunder IAS 33, if their redemption results in the issuance ofshares at a value below the assigned current value. The455,000 subscription rights cannot be exercised earlier thantwo years after their issuance. According to the position ofthe Institute of German Auditors with regard to accounting
Net loss: DEM – 6,937,040.38
Undiluted number of shares: shares 9,100,000
Basic earnings per share: DEM – 0.76
treatment: Questions Pertaining to the Application of IAS
(IDW RS HFA 2), and based upon IAS 33.31, it is presumedthat the agreed-upon waiting period in the stock optionplan ends on the closing date of the financial statements.
The stock option plan presumes a minimum base priceof 50 percent of the initial issue price for the exercise of thesubscription rights. The issue price of shares of ORBIS AGwas EUR 14, therefore the minimum base price upon exerciseof the subscription rights equals EUR 7. On the closingdate of the financial statements, the shares of ORBIS AGhad been below EUR 7 for some time, therefore the fictitiousexercise of the subscription rights would not result inthe issuance of shares at a value below the assignedvalue. Therefore the stock option plan does not haveany diluting effect on the reporting of earnings per share.No other rights with diluting effects have been issued.
VII. Information on earnings per share
Addition fromBalance as of initial Currency Balance as of01/01/2000 consolidation Addition Reduction difference 12/31/2000
DEM DEM DEM DEM DEM DEM
I. Intangible assets
1. Development costs 7,103,731.00 0.00 4,962,979.00 0.00 0.00 12,066,710.00
2. Commercial trademarks
and licenses 253,633.37 0.00 1,258,716.02 3,950.00 0.00 1,516,299.39
3. Goodwill 10,571,941.78 154,534.07 0.00 0.00 0.00 10,726.475.85
17,929,306.15 154,534.07 6,221,695.02 3,950.00 0.00 24,309,485.24
II. Tangible assets
1. Property and buildings 9,642,952.02 0.00 475,212.59 0.00 0.00 10,118,164.61
2. Other assets, office
and operating equipment 3,303,357.44 209,664.47 2,467,582.48 -875,708.52 8,671.85 5,113,567.72
12,946,309.46 209,664.47 2,942,795.07 -875,708.52 8,671.85 15,231,732.33
III. Financial assets
1. Interests in associated companies 0.00 0.00 38,138.69 0.00 0.00 38,138.69
2. Loans to associated companies 0.00 0.00 0.00 0.00 0.00 0.00
3. Participations 0.00 0.00 41,072.43 0.00 0.00 41,072.43
0.00 0.00 79,211.12 0.00 0.00 79,211.12
Total assets 30,875,615.61 364.198.54 9,243,701.21 -871,758.52 8,671.85 39,620,428.69
Acquisition and production costs
Addition fromBalance as of initial Currency Balance as of Balance as of Balance as of01/01/2000 consolidation Addition Reduction difference 12/31/2000 12/31/2000 01/01/2000
DEM DEM DEM DEM DEM DEM DEM DEM
2,241,786.00 0.00 2,242,317.00 0.00 0.00 4,484,103.00 7,582,607.00 4,861,945.00
144,005.82 0.00 100,202.12 3,950.00 0.00 248,157.94 1,268,141.45 109,627.55
0.00 0.00 1,080,374.17 0.00 0.00 1,080,374.17 9,646,101.68 10,571,941.78
2,385,791.82 0.00 3,422,893.29 3,950.00 0.00 5,812,635.11 18,496,850.13 15,543,514.33
341,871.55 0.00 218,442.59 0.00 0.00 560,314.14 9,557,850.47 9,301,080.47
1,960,030.70 141,483.47 1,461,834.72 -855,662.68 1,717.70 2,709,403.91 2,404,163.81 1,343,326.74
2,301,902.25 141,483.47 1,680,277.31 -855,662.68 1,717.70 3,269,718.05 11,962,014.28 10,644,407.21
0.00 0.00 0.00 0.00 0.00 0.00 38,138.69 0.00
0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00
0.00 0.00 0.00 0.00 0.00 0.00 41,072.43 0.00
0.00 0.00 0.00 0.00 0.00 0.00 79,211.12 0.00
4,687,694.07 141,483.47 5,103,170.60 -851,712.68 1,717.70 9,082,353.16 30,538,075.53 26,187,921.54
Amortization/depreciation Book value
Düsseldorf, Germany, March 5, 2001
Rölfs WP Partner AG
Wirtschaftsprüfungsgesellschaft
Rainer Grote Birgit Düsterloh
– Certified auditor – – Certified auditor –
In our opinion, based on our audit and the opinions of theother auditors, the consolidated financial statements givea true and fair view of the net assets, financial position,results of operations and cash flows for the fiscal year inaccordance with IAS.
Our audit, which also extends to the consolidatedmanagement report prepared by the Management Boardfor the fiscal year from January 1 to December 31, 2000,has not led to any reservations. In our opinion, on the wholethe consolidated management report provides a suitableunderstanding of the Group's position and suitably presentsthe risks of future development. We further confirm thatthe consolidated financial statement and consolidatedmanagement report for the fiscal year from January 1 toDecember 31, 2000 meets the requirements under Germanlaw for exempting the company from the preparation ofconsolidated financial statements and a consolidatedmanagement report. Our examination of compliance withthe EC directive (7. EG-Richtlinie) regarding exemption fromrequirements for the preparation of consolidated accountingwas based on the interpretation of the directive by theGerman Accounting Standards Committee (Deutsche
Rechnungslegungs Standards Committee, DRSC).”
”We have audited the consolidated financial statementsprepared by ORBIS AG, Saarbrücken, Germany, consistingof the balance sheet, the income statement and thestatements of changes in equity and cash flows as well asthe notes to the financial statements for the financial yearfrom January 1 to December 31, 2000. The preparation andcontent of the consolidated financial statements are theresponsibility of the company’s Management Board. Ourresponsibility is to express an opinion, based on our audit,whether the consolidated financial statements are inaccordance with International Accounting Standards (IAS).
We conducted our audit of the consolidated financialstatements in accordance with German auditing regulationsand generally accepted standards for the audit of financialstatements promulgated by the Institute of German Auditors (IDW). Those standards require that we plan and performthe audit to obtain reasonable assurance about whether theconsolidated financial statements are free of materialmisstatements. The evidence supporting the amounts anddisclosures in the consolidated financial statements areexamined on a test basis within the framework of the audit.The audit includes assessing the accounting principles usedand significant estimates made by the legal representatives,as well as evaluating the overall presentation of theconsolidated financial statements. We believe that our auditprovides a reasonable basis for our opinion.
A u d i t o r s ’ c e r t i f i c a t i o n
Concept & Text Gavin Anderson & Company Worldwide, Frankfurt, Germany
Layout 7°OST Werbeagentur, Saarbrücken, Germany
Photography André Mailänder, Saarbrücken, Germany
Photo Éclair, Saarbrücken, Germany
Rolf Ruppenthal, Wadgassen, Germany
ORBIS archives
Print fischerdruck, Güdingen, Germany
Investor Relations Phone +49 (0) 681/99 24-999
Imprint
Contents
Capital stock
Management Board
F rance
GmbH
100 %
100 %
Hamburg
80 %
Bie le fe ld
74.9 % 10
ORBIS Saarbrücken
ORBIS GmbHNell-Breuning-Allee 3–5D-66115 Saarbrücken, GermanyPhone +49 (0) 681/99 24-0Fax +49 (0) 681/99 [email protected]
ORBIS Bielefeld
ORBIS Bielefeld GmbHGadderbaumer Straße 20D-33602 Bielefeld, GermanyPhone +49 (0) 521/5 60 60-0Fax +49 (0) 521/5 60 [email protected]
ORBIS Hamburg
ORBIS Hamburg GmbHSachsenfeld 2D-20097 Hamburg, GermanyPhone +49 (0) 40/3 25 17-0Fax +49 (0) 40/3 25 [email protected]
ORBIS France
ORBIS France2, Parc des Erables66, route de SartrouvilleF-78232 Le Pecq cedex, FrancePhone +33 (0)1/30 09 14 40Fax +33 (0)1/30 09 14 [email protected]
EUR 9.1 million
Thomas Gard
Klaus Kieren
Stefan Mailänder
Ulrich Thiele
AG
ORBIS AG
ORBIS AGNell-Breuning-Allee 3–5D-66115 Saarbrücken, GermanyPhone +49 (0) 681/99 24-0Fax +49 (0) 681/99 [email protected]
communications
55 %
Amer ica
00 %
St ra tegy
90.1 %
eMedia
55 %
ORBIS Strategy
ORBIS Strategy GmbHHeinrich-Barth-Straße 20D-66115 Saarbrücken, GermanyPhone +49 (0) 681/7 55 94 00Fax +49 (0) 681/7 55 94 [email protected]
ORBIS eMedia
ORBIS eMedia GmbHFeldmannstraße 121D-66119 Saarbrücken, GermanyPhone +49 (0) 681/5 76 66Fax +49 (0) 681/5 76 [email protected]
ORBIS communications
ORBIS communications GmbHGoethestraße 3–5D-66121 Saarbrücken, GermanyPhone +49 (0) 681/9 67 27-60Fax +49 (0) 681/9 67 [email protected]
ORBIS America
ORBIS America Inc.8150 Leesburg PikeSuite 1050Vienna VA 22182, USAPhone +1 703/7 34-64 94Fax +1 703/7 34-65 [email protected]