Unidades de transporte a temperatura regulada

is impressive evidence that Drillisch has maintained its operating earning power.

This good development of our business is supported by the ongoing dynamic de-velopments in the fields of wireless ser-vices and mobile internet. Drillisch uses innovative products in conjunction with efficient marketing and sales concepts to maintain its top position in the German telecommunications industry.

The “service revenues”, essentially the income from the provision of the on-going wireless services (voice and data transmission) and their billing on the

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Business Report

sis of the current customer relationships, rose by €7.4 million (2.7%) in fiscal year 2014 to €284.6 million (previous year:

€277.2 million).

The low-margin item “Other revenues”

declined as expected in comparison with the same period last year by €8.1 milli-on to €5.1 millimilli-on (previous year: €13.2 million). This item also includes the sa-les from the software services segment in the amount of €53k (previous year:

€69k).

Total turnover in 2014 amounted to

€289.7 million (previous year: €290.5 mil-lion).

The MVNO clientele increased further from in the course of the year by 223,000 (13.1%) to 1.928 million subscribers (31 December 2013: 1.705 million MVNO subscribers). The number of qualitatively

higher-value budget subscribers increa-sed by 41.5% to 1.211 million subscri-bers per 31 December 2014 (31 Decem-ber 2013: 856,000 subscriDecem-bers). The number of volume subscribers declined as expected from 848,000 subscribers per 31 December 2013 to 717,000 subscribers per 31 December 2014.

The number of subscribers in the prepaid sector decreased as expected to 91,000 (31 December 2013: 123,000). Overall, the ratio of postpaid to prepaid sub-scribers improved and is now 95.6% to 4.4%, an increase of 2.1% for postpaid compared to the end of 2013 (31 Decem-ber 2013: 93.5% postpaid to 6.5% pre-paid).

The total number of subscribers rose by 170,000 to 2.070 million (31 December 2013: 1.900 million). This continues the trend of a rising total number of subscri-bers, and the decrease in subscribers in the previous service provider business no longer has any major impact.

The cost of materials declined, overpro-portionately to the decline in revenues, by 14.3% to €147.0 million in fiscal year 2014 (previous year: €171.4 million). With the continuous increase in subscribers and the qualitative improvements of the tariff mix Gross profit improved as a con-+2.7%

2013

2014 Service Revenues (in €m)

277.2 284.6

+13.1%

2013

2014 MVNO Subscribers (in m)

1.705

1.928

+41.5%

2013

2014 Budget Subscribers (in m)

0.856

1.211

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Business Report

sequence by €23.6 million from €119.0 million in 2013 to €142.6 million in 2014.

The gross profit margin increased by 8.3% to 49.3% (previous year: 41.0%).

Personnel expenses increased by 3.3%

to €24.6 million (previous year: €23.8 million). Correspondingly, the personnel expenses ratio in 2014 rose by 0.3% to 8.5% (previous year: 8.2%). Other opera-ting expenses rose in total by €5.5 milli-on to €36.0 millimilli-on (previous year: €30.5 million). The rise in comparison with the previous year resulted primarily from higher expenditures for advertising of

€14.1 million (previous year: €9.7 million) and higher expenditures from bad debts and valuation allowances on receivables of €5.4 million (previous year: €3.9 milli-on). In contrast, the costs for third-party services fell significantly from €2.7 milli-on in 2013 to €1.7 millimilli-on in 2014. The consolidated EBITDA (earnings before interest, taxes, depreciation and amorti-sation), one of the most important ma-nagement indicators in Drillisch Group, rose by €14.4 million (20.3%) to €85.2 million (previous year: €70.8 million). The EBITDA margin came to 29.4% (previous year: 24.4%). Write-offs remained virtu-ally constant at €9.9 million (previous year: €9.6 million). The EBIT (earnings

before interest and taxes) amounted to

€75.3 million (previous year: €61.2 milli-on). The EBIT ratio improved by 4.9% to 26.0% (previous year: 21.1%).

The results from the financial assets shown in the balance sheet according to the equity method in 2014 amounted to

€0.0 (previous year: €10.3 million). In the previous year, the shares in freenet AG held by MSP and Drillisch AG were mea-sured according to the equity method until 20 March 2013 because of the sig-nificant influence on the company from the voting rights quota of more than 20%.

Other financial results in 2014 also amounted to €0.0 (previous year: €155.5 million). In the same period of last year, the Other financial results essentially comprised income from the reclassifica-tion of securities as AFS (available for sale) assets and expenditures and income from the closing-date measurement and reversal of financial derivatives and hed-ging transactions which were sold or re-versed completely in the course of fiscal year 2013.

The interest result improved by €46.4 million to €-2.7 million (previous year:

€-49.1 million). In the same period last year, the interest result was essential-+19.8%

2013

2014 Gross Profit (in €m)

119.0

142.6

+20.3%

2013

2014

EBITDA

70.8

85.2

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Business Report

ly attributed to interest expenses in connection with cash compensation for exchanged debenture bonds as well as a significantly higher volume of long-term liabilities subject to interest charges.

Taxes on income rose slightly by €0.3 million to €22.5 million (previous year:

€22.2 million). Consolidated profit amounted to €50.1 million (previous year: €155.8 million). In 2013, the con-solidated profit was marked largely by effects from the conversion of the mea-surement of the freenet holding to the AFS method and the market valuation of hedging transactions and derivatives.

Excluding these effects, the consolidated profit in 2013 amounted to €46.9 mil-lion. The consolidated comprehensive result per 31 December 2014 amounted to €49.7 million (previous year: €155.8 million) and thus reflects almost exclusi-vely the earning power of the operating business. The undiluted profit per share came to €1.03 (previous year, excluding the freenet holding: €0.98).

General statement on business develop-ment

Operating in a friendly, although highly competitive, industrial environment, Dril-lisch Group achieved the upper end of the original EBITDA forecast of €82 milli-on to €85 millimilli-on cmilli-onfirmed again in No-vember 2014 and even exceeded it slight-ly by posting a figure of €85.2 million. As planned, the Company also succeeded in increasing the number of MVNO sub-scribers again. The profitability and yield indicators relevant for Drillisch of gross profit and EBITDA continued to improve.

Business development clearly demons-trates that Drillisch has been pursuing a course of consistently profitable growth for many years which is largely indepen-dent of general economic fluctuations.

Management Board and Supervisory Board will therefore propose a dividend of €1.70 for each share entitled to divi-dends to the Annual General Meeting.

2.4. Assets, liabilities and financial