Evonik Industries AG

Quarterly Report • May 14, 2013

Quarterly financial report Q1 2013

A moderate start—Outlook for 2013 confirmed

• Operating business below strong prior year
• Improvement in net income
• Step plan to exit the Real Estate segment
• Evonik shares listed on the stock market since April 25
• Outlook for 2013 confirmed

Key data for the Evonik Group

	1st quarter
in € million	2013	2012
Sales	3,263	3,407
Adjusted EBITDA1)	589	656
Adjusted EBITDA margin in %	18.1%	19.3%
Adjusted EBIT2)	445	509
EBIT	415	440
Income before financial result and income taxes, continuing operations	396	428
Net income	289	269
Earnings per share in €	+0.62	+0.58
Adjusted earnings per share in €	+0.63	+0.68
Cash flow from operating activities	213	383
Capital expenditures	183	161
Net financial debt as of March 31	-1,137	-1,033
Employees as of March 31	33,455	33,316

Prior-year figures restated.

1) Earnings before interest, taxes, depreciation and amortization, after adjustments

2) Earnings before interest and taxes, after adjustments

Management report as of March 31, 2013

Contents

Business conditions and performance	3
Economic background	3
Business performance	3
Segment performance
Earnings, financial and asset position	12
Earnings position	12
Financial and asset position	13
Research & development	14
Employees	15
Events after the reporting date	15
Expected development	16

1. Business conditions and performance

$1.1$ Economic background

Global economic growth remained subdued in the first quarter of 2013. The trend was fragile and differed by region. The economic upturn in the industrialized countries continued its inhomogeneous pattern in the first quarter of 2013 and remained weak overall, whereas economic momentum picked up in the emerging markets.

The negative factors that continued to influence the global economy in the first quarter of 2013 resulted, among other things, from the sovereign debt crisis in the euro zone, geopolitical conflicts and imbalances within major industrialized countries. Despite their positive overall performance, the international commodity and financial markets reflected the economic system's ongoing vulnerability to these risks.

The global development of the industries served by Evonik differed by region and by sector in the first quarter of 2013. Compared with the fourth quarter of 2012, however, there was a general upturn in production. Despite basic regional differences, there was an improvement in demand, partly as a result of the inventory cycle. However, compared with the first quarter of 2012, demand was well below output in many end-customer markets in Europe and Japan, especially the automotive sector and the market for paints and coatings. Overall, demand in the construction sector bucked the general industrial trend. While there was still no positive impetus in Europe and demand for construction work declined, demand remained consistently high in the USA.

The price of Brent crude oil was again very volatile in the first quarter of 2013, but at US\$101 per barrel it was slightly below the annual average for 2012. The performance of the euro was very inhomogeneous in the first quarter owing to the European sovereign debt crisis and the US budget consolidation dispute. However, it was slightly stronger than at the end of 2012, with an average exchange rate of $E1.32$ per US dollar in the first quarter of 2013.

$1.2$ Business performance

In a challenging economic environment, Evonik got off to a somewhat moderate start in 2013. Compared with the strong first quarter of 2012, we registered lower demand in some markets, declining selling prices and, in some cases, higher raw material costs. Overall, sales and operating results in the continuing operations were below the previous year's very good figures (excluding the Real Estate segment).

At the start of 2013, the previous sole owners of Evonik Industries AG-RAG-Stiftung and funds advised by CVC Capital Partners-sold some of their shares to institutional investors in Germany and abroad through private placements in preparation for Evonik's stock exchange listing. Shares in Evonik were admitted to trading on the regulated market of the stock exchanges in Frankfurt am Main and Luxembourg on April 24, 2013 and trading commenced on April 25, 2013. Through a number of private placements, the previous sole owners had sold equal proportions of their shares amounting to around 14.5 percent of the company's capital stock prior to the start of trading.

In accordance with its focus on specialty chemicals. Evonik intends to withdraw completely from the real estate activities bundled in its Real Estate segment. In March 2013 we resolved on a step plan to divest the majority of this business. Accordingly, the Real Estate business has been reclassified to discontinued operations. Evonik currently holds 100 percent of the shares in Vivawest GmbH, which in turn has a stake of around 50 percent in THS GmbH. The other 50 percent is held by Vermögensverwaltungs- und Treuhandgesellschaft der Industriegewerkschaft Bergbau und Energie mbH (VTG). Vivawest and THS combined

the property management activities for their residential real estate effective January 1, 2012. Now Vivawest GmbH and THS GmbH are to be combined in a single entity. VTG will hold around 27 percent of the shares in the new company, while Evonik will hold about 73 percent. As part of the transfer to a stable new ownership structure, Evonik plans to sell a 30 percent stake to RAG-Stiftung and a stake of around 10 percent to RAG Aktiengesellschaft. These transactions are contingent on the approval of the relevant bodies. The real estate activities are expected to be deconsolidated during 2013 once Evonik no longer holds a majority of shares in the new company. In addition, a 25 percent stake is to be transferred to Evonik Pensionstreuhand e. V. (contractual trust arrangement, CTA). After these transactions, Evonik will probably still directly hold around 8 percent of the shares in the real estate activities. In the mid term we intend to divest this stake to trusted investors with a long-term investment horizon. Ahead of the planned reorganization of the ownership structure, Vivawest's capital structure will be adjusted to a level that is customary in the sector and will distribute €650 million to its present sole owner, Evonik Industries AG.

Sales by quarters

In the first quarter of 2013, the Evonik Group's sales declined 4 percent to $\epsilon$ 3,263 million. While demand was stable overall, the organic sales trend slipped 2 percent due to lower selling prices. The other effects totaling minus 2 percentage points mainly related to the colorants business that was divested in April 2012 and the cyanuric chloride business in China, which was sold in December 2012.

Year-on-year change in sales

in %	Q1 2013
Volume	0%
Price	$-2%$
Organic sales growth	$-2%$
Exchange rates	0%
Other effects	$-2%$
Total	$-4%$

In € million; prior-year figures restated.

In € million; p prior-year figures r estated.

Operating some cas million in EBITDA d adjusted g results wer ses, higher ra n 2012 opera eclined by 1 EBITDA marg re below the aw material c ating results, 0 percent to gin slipped f previous yea costs. The ap €6 million o €589 million rom 19.3 pe ar's high leve pplication of of which relat n, while adju rcent to 18.1 els, mainly as IAS 191 caus ted to the fir sted EBIT dro 1 percent. a result of l ed a retrospe st quarter of opped 13 pe ower selling ective increa f 2012. Overa rcent to €44 prices and, i se of €22 ll, adjusted 5 million. Th in e

¹ See Note e 3.

Statement of income

		1st quarter
in $\epsilon$ million	2013	2012
Sales	3,263	3,407
Adjusted EBITDA	589	656
Depreciation and amortization	$-144$	$-147$
Adjusted EBIT	445	509
Adjustments	$-30$	$-69$
thereof attributable to
Restructuring	$-5$	$-6$
Impairment losses/reversals of impairment losses		$-71$
Acquisition/divestment of shareholdings		$-3$
Other	$-25$	11
Net interest expense	$-66$	$-80$
Income before income taxes, continuing operations	349	360
Income taxes	$-83$	$-114$
Income after income taxes, continuing operations	266	246
Income after income taxes, discontinued operations	20	20
Income after taxes	286	266
Attributable to non-controlling interests	3	3
Net income	289	269
Earnings per share in $\epsilon$	$+0.62$	$+0.58$

Prior-year figures restated.

The adjustments of minus €30 million mainly comprise expenses of €11 million in connection with the recognition of the put and call options for the remaining shares in STEAG GmbH, and €6 million from the adjustment of provisions for the German phased retirement program in accordance with IAS 19. The prior-year figure mainly comprised impairment losses on production plants in the Resource Efficiency segment due to tougher competition in the photovoltaic sector, and income of €11 million in connection with the recognition of the STEAG options.

Net interest expense improved to €66 million, driven by lower interest rates for pensions and higher income as a result of the transfers made to the CTA in 2012. Income before income taxes, continuing operations was €349 million, only slightly below the prior-year level of €360 million. The income tax rate was 24 percent, principally due to tax income relating to previous periods.

Income after taxes, discontinued operations amounted to €20 million and related almost entirely to the Real Estate segment. Total income after taxes rose 8 percent to €286 million. Net income grew 7 percent yearon-year to €289 million.

Adjusted net income reflects the operating performance so it does not contain the impact of either the adjustments or discontinued operations. Adjusted net income dropped 7 percent to €294 million in the first quarter of 2013. Adjusted earnings per share decreased from €0.68 to €0.63.

Reconciliation to adjusted net income

	1st quarter
in $\epsilon$ million	2013	2012
Income before financial result and income taxes 1)	396	428
Result from investments recognized at equity	13	12 2
Other financial income	6
EBIT	415	440
Adjustments	30	69
Adjusted EBIT	445	509
Net interest expense	$-66$	-80
Adjusted income before income taxes 1)	379	429
Adjusted income taxes	$-88$	$-115$
Adjusted income after taxes 1)	291	314
Adjusted income attributable to non-controlling interests	3	3
Adjusted net income 1)	294	317
Adjusted earnings per share in $\epsilon$	$+0.63$	$+0.68$

Prior-year figures restated. 1) Continuing operations

$1.3$ Segment performance

Consumer, Health & Nutrition segment

The Consumer, Health & Nutrition segment produces specialty chemicals, principally for applications in the consumer goods, animal nutrition and health-care sectors. It comprises the Consumer Specialties and Health & Nutrition Business Units.

Key data for the Consumer, Health & Nutrition segment

	1st quarter
in $\epsilon$ million	2013	2012
External sales	1,035	1,055
Adjusted EBITDA	274	287
Adjusted EBITDA margin in %	26.5%	27.2%
Adjusted EBIT	240	254
EBIT	240	253
Capital expenditures	60	45
Employees as of March 31	6,878	6,604

Prior-year figures restated.

Sales in the Consumer, Health & Nutrition segment decreased by 2 percent to €1,035 million. This was mainly attributable to an organic sales reduction, caused by lower selling prices, while volumes increased slightly. The operating results fell short of the previous year's very high levels, mainly due to declining prices: Adjusted EBITDA slipped 5 percent to €274 million while adjusted EBIT fell 6 percent to €240 million. There was a slight decline in the adjusted EBITDA margin from 27.2 percent to 26.5 percent.

In $\epsilon$ million.

The Consumer Specialties Business Unit grew sales 8 percent to €553 million in the first quarter of 2013. While the development of household and personal care products was relatively flat, particularly strong demand was registered for superabsorbents for babies' diapers and hygiene products. The operating results also rose.

Sales in the Health & Nutrition Business Unit contracted by 11 percent to €482 million. Demand for amino acids, which are important components in animal nutrition, was lower than in the exceptionally good prior-year quarter, especially in the Asia-Pacific region. Selling prices were also below the very good level seen in the first quarter of 2012, but almost unchanged compared with the fourth quarter of 2012. Business with healthcare products also remained below the high level posted in the first quarter of 2012. The operating results in the Health & Nutrition Business Unit were below the excellent level seen in the prior-year quarter.

Resource Efficiency segment

The Resource Efficiency segment provides environment-friendly and energy-efficient system solutions. This segment comprises the Inorganic Materials and Coatings & Additives Business Units.

Key data for the Resource Efficiency segment

	1st quarter
in $\epsilon$ million	2013	2012
External sales	771	818
Adjusted EBITDA	172	168
Adjusted EBITDA margin in %	22.3%	20.5%
Adjusted EBIT	143	131
EBIT	138	60
Capital expenditures	37	28
Employees as of March 31	5,806	6,029

Prior-year figures restated.

In the Resource Efficiency segment sales dropped 6 percent to €771 million. The main factor in this was the divestment of the colorants business at the end of April 2012. Lower volumes resulted in a slight organic sales drop. The operating results increased, mainly due to lower fixed costs following restructuring of the photovoltaic business in the fourth quarter of 2012. This principally involved the shutdown of one production plant and the sale of another. Adjusted EBITDA increased 2 percent to €172 million, while adjusted EBIT advanced 9 percent to €143 million. The adjusted EBITDA margin was 22.3 percent, up from 20.5 percent in the first quarter of 2012.

In $\epsilon$ million.

In the Inorganic Materials Business Unit sales amounted to €361 million, almost level with the previous year. Business with specialty oxides did particularly well. These products are used, for example, in the electronics industry and cosmetics, and as carriers for catalysts. The operating results increased due to the reduction in fixed costs outlined above.

In the Coatings & Additives Business Unit sales dropped 10 percent to €410 million. The chief reasons for this were that the prior-year figures still included the colorants business, plus a decline in sales volumes. Demand from the construction and coatings sectors in particular was lower than a year earlier, while oil

additives posted a stable trend. The operating results were also below previous year's good level, which still contained earnings from the colorants business.

In € million; prior-year figures restated.

Specialty Materials segment

The heart of the Specialty Materials segment is the production of polymer materials and intermediates, mainly for the rubber and plastics industries. It comprises the Performance Polymers and Advanced Intermediates Business Units.

Key data for the Specialty Materials segment

	1st quarter
in $\epsilon$ million	2013	2012
External sales	1,170	1,234
Adjusted EBITDA	182	215
Adjusted EBITDA margin in %	15.6%	17.4%
Adjusted EBIT	145	178
EBIT	140	175
Capital expenditures	50	54
Employees as of March 31	6,229	6,710

Prior-year figures restated.

The Specialty Materials segment's sales dropped 5 percent to €1,170 million. This was attributable in almost equal amounts to the divestment of the cyanuric chloride business in China in December 2012 and an organic sales reduction, mainly due to lower selling prices. The drop in volumes resulting from the production stoppage following the fire at the CDT plant in late March 2012 was offset by higher demand for other products. However, selling prices were below the previous year's very high levels, especially for C4 products. The operating results fell short of the very good results for the first quarter of 2012 due to lower selling prices and, in some cases, higher raw material costs. By contrast, the earnings reduction caused by the production shortfall following the fire was offset to a large extent by insurance. Adjusted EBITDA decreased by 15 percent

to €182 m from 17.4 million, while 4 percent in e adjusted EB the first qua BIT fell 19 pe rter of 2012 ercent to €14 to 15.6 perc 45 million. Th cent in the fir he adjusted E rst quarter of EBITDA marg f 2013. in thus drop ped

In € million.

The Perfo productio first quar methacry year earli level. ormance Poly on at this fac rter of 2012 t ylates was als er. Sales fell ymers Busine cility and ups these plants so lower so o 7 percent to ss Unit took tream polyam operated at overall Perfor o €443 millio the rebuilt C mide 12 plan high capacit rmance Polym on and the op CDT plant ba nts was ramp y until the fi mers' volume perating resu ck into servic ped up at the re at the end sales were c ults were also ce at the end e beginning o d of March. D considerably o below the p d of 2012 and of 2013. In th Demand for lower than a previous year dhe r's

Th caused by good dem results w e 4 percent d y the divestm mand for, am ere below th decrease in s ment of cyanu mong other th e previous ye sales in the A uric chloride hings, plastic ear's very go Advanced Inte activities in cizer alcohols ood figures. ermediates B China. Price s, butene-1 a Business Unit declines for and hydroge t to €727 mil C4 products n peroxide. T llion was ma were offset The operatin inly by g

In € million; p prior-year figures r estated.

Services segment

This segment principally comprises Site Services and Evonik Business Services. It mainly provides services for the specialty chemicals segments and the Corporate Center.

This seament's sales totaled $\epsilon$ 647 million. Internal sales accounted for $\epsilon$ 411 million of the total. External sales declined by 8 percent to $\epsilon$ 236 million as a customer shut down a production facility at the site in Marl (Germany). The operating results were on a par with the previous year. Adjusted EBITDA rose slightly to €54 million while adjusted EBIT was unchanged at €32 million.

Real Estate segment

The Real Estate segment focuses on letting homes to private households in the federal state of North Rhine-Westphalia. A step plan for divestment of the majority of the real estate activities was adopted in March 2013 and this segment was reclassified to discontinued operations.

Sales in the Real Estate segment advanced 10 percent to $\epsilon$ 54 million thanks mainly to higher revenues from real estate services and property sales. The operating results benefited from the book gains resulting from the sale of commercial property. Adiusted EBITDA increased by 2 percent to €42 million, while adiusted EBIT was unchanged year-on-year at €30 million.

2. Earnings, financial and asset position

$2.1$ Earnings position

Sales dropped 4 percent to €3,263 million. The cost of sales only fell by 2 percent to €2,316 million as some raw material prices increased. The gross profit on sales decreased by 10 percent to €947 million. Selling and administrative expenses rose by 3 percent to €471 million, and research and development expenses also increased by 3 percent, to €95 million.

Other operating income totaling $\epsilon$ 289 million includes income from the measurement of derivatives and from currency translation of monetary assets and liabilities. The year-on-year increase of €15 million in other operating income was due to the reversal of provisions and to higher insurance refunds, while income from the measurement of derivatives was lower. The other operating expenses of $\epsilon$ 274 million include expenses from the measurement of derivatives and currency translation of monetary assets and liabilities. The decrease of €75 million was mainly due to the fact that the prior-year figures included impairment losses on assets. Income before the financial result and income taxes, continuing operations declined by 7 percent to €396 million.

The financial result improved by $E$ 21 million to minus $E$ 47 million, principally due to lower interest expense and an increase in other financial income. Income before income taxes, continuing operations declined 3 percent to €349 million. Income taxes dropped to €83 million as a result of tax income relating to prior periods. Income after taxes from continuing operations increased by 8 percent overall to €266 million.

The Income after taxes of $E$ 20 million from the discontinued operations related almost entirely to the Real Estate segment. Income after taxes improved 8 percent to €286 million. Non-controlling interests in after-tax income amounted to minus €3 million, as in the first quarter of 2012. Overall, the net income of the Evonik Group improved 7 percent to €289 million.

$2.2$ Financial and asset position

As of March 31, 2013, financial debt was €2,258 million, a drop of €576 million from year-end 2012, mainly because of the reclassification of the Real Estate segment to discontinued operations. Financial assets declined by $\epsilon$ 550 million to $\epsilon$ 1,121 million, essentially as a result of the dividend of $\epsilon$ 429 million paid on March 12, 2013. Overall, net financial debt was €1,137 million at the end of March, slightly lower than at year-end 2012.

Net financial debt

	March 31,	Dec. 31,
in $\epsilon$ million	2013	2012
Non-current financial liabilities	$-906$	$-1,397$
Current financial liabilities	$-1,352$	$-1,437$
Financial debt $\mathfrak{v}$	$-2,258$	$-2,834$
Cash and cash equivalents	563	741
Current securities	556	928
Other financial assets	$\overline{2}$	2
Financial assets 1)	1,121	1,671
Net financial debt as stated on the balance sheet	$-1,137$	$-1,163$
Net financial debt, discontinued operations	-491
Net financial debt (total)	$-1,628$

1) Excluding derivatives.

In February 2013, Evonik launched a debt issuance program on the Luxembourg stock exchange with a total volume of up to €3 billion. On April 8, 2013 we used this to issue a €500 million bond, which has greatly improved our maturity profile. The bond matures in seven years. The issue price was 99.185 percent and it has a coupon of 1.875 percent. Standard & Poor's has given the bond a BBB+ rating with a stable outlook, while Moody's rating is Baa2 with a positive outlook. Together with available liquidity, the proceeds from the issue will be used. among other things, to redeem the €1.1 billion Evonik-Degussa bond, which matures in December 2013.

Cash flow statement (excerpt)

	1st quarter
in $\epsilon$ million	2013	2012
Cash flow from operating activities, continuing operations	192	364
Cash flow from operating activities, discontinued operations	21	19
Cash flow from operating activities	213	383
Cash flow from investing activities, continuing operations	147	$-233$
Cash flow from investing activities, discontinued operations	8	ב
Cash flow from investing activities	155	$-228$
Cash flow from financing activities, continuing operations	$-503$	15
Cash flow from financing activities, discontinued operations		30
Cash flow from financing activities	$-503$	45
Change in cash and cash equivalents	$-135$	200

Prior-year figures restated.

The cash flow from operating activities in the continuing operations declined by $\epsilon$ 172 million to $\epsilon$ 192 million in the first quarter of 2013. The main reasons for this were lower earnings before depreciation, amortization, the financial result and income taxes and the increase in net working capital, partly in connection with upcoming overhauls of production plants. The cash flow from discontinued operations increased slightly to €21 million. Overall, the cash flow from operating activities declined by €170 million year-on-year to €213 million. Investing activities by the continuing operations led to a cash inflow of $\epsilon$ 147 million, with cash outflows for capital expenditures offset by inflows from the sale of current securities. In the first quarter of 2012, cash outflows for capital expenditures and securities resulted in a total outflow of €233 million. Together with the cash inflow from the discontinued operations, the cash flow from investing activities comprised an inflow of €155 million in the first quarter of 2013, compared with an outflow of €228 million in the first quarter of 2012. The cash outflow for financing activities totaling €503 million mainly comprised the dividend payment for fiscal 2012. In the first quarter of 2012, the cash flow from financing activities comprised an inflow of €45 million; the dividend for 2011 was only paid in the second quarter of 2012.

Capital expenditures increased 14 percent to €183 million, in line with our ambitious investment program. 33 percent of capital expenditures were allocated to the Consumer, Health & Nutrition segment, 27 percent to the Specialty Materials segment and 20 percent to the Resource Efficiency segment. In Essen (Germany), the Consumer Specialties Business Unit started production of the TEGOPAC® brand of silanemodified polymers for the sealants and adhesives industry. A new innovation center for future-oriented cosmetics products was also completed in Essen. Following the rapid reconstruction of the CDT plant, the Performance Polymers restarted production at the beginning of this year.

As a consequence of the retrospective application of IAS 19², some items on the balance sheet for 2012 have been restated. This increased pension provisions as of December 31, 2012 by €2.0 billion, while equity declined by €1.4 billion. In all, the changes increased total equity and liabilities as of year-end 2012 by €0.5 billion to €17.2 billion. Total assets were €17.0 billion as of March 31, 2013, slightly lower than at year-end 2012. The €2.1 billion drop in non-current assets to €9.3 billion was mainly due to the reclassification of the Real Estate segment's non-current assets to assets held for sale. The €2.0 billion increase in current assets to €7.7 billion was principally driven by the substantial rise in assets held for sale. Equity increased by €0.1 billion to €5.4 billion. The equity ratio improved from 31.9 percent to 31.5 percent.

3. Research & development

As a specialty chemicals company, Evonik continued its intensive research and development (R&D) activities in the first quarter of 2013. R&D expenses increased slightly year-on-year to $\epsilon$ 95 million.

A two kilometer natural gas pipeline made of VESTAMID® NRG was installed at the Indubrasil industrial facility in Campo Grande (Brazil). This was the result of an R&D project covering aspects such as material development, permitting, testing and work on standards committees. This pilot pipeline made of polvamide 12 (PA12) from the Specialty Materials segment serves customer of the MSGÁS utility company, with which we have signed a cooperation agreement. It is the first PA12 gas pipeline in South America in the $>10$ bar pressure range.

The CALOSTAT® high-performance thermal insulation developed by the Resource Efficiency segment was awarded the "Praxis Altbau" prize for product innovations for the refurbishment of old buildings. CALOSTAT^® mainly consists of silicon dioxide and is non-combustible and recyclable. The main applications are interior insulation and refurbishment of facades.

^<sup>2 See Note 3.

In mid-March 2013, more than 80 scholarship students were given an insight into day-to-day work at a global specialty chemicals company at Evonik's campus in Essen. In the 2012/2013 academic year, Evonik is providing a total of 180 scholarships for students at 13 German universities. Through the Evonik Foundation we have supported students and doctoral candidates with their research for many years.

To expand our presence on the Asian electronics market and open up new opportunities for Evonik in collaboration with customers, a year ago we opened the offices and laboratories of our Light & Electronics Advanced Project House in Hsinchu (Taiwan). Research at this project house, which is located in the direct vicinity of major electronics companies, focuses on aspects such as large-format lighting and display components, materials for organic light-emitting diodes (OLEDs) and coatings solutions for electronics. In the past twelve months, several cooperations have started and the first patent application has been filed.

4. Employees

As of March 31, 2013 the Evonik Group had 33,455 employees, 32,814 of whom were employed in the continuing operations. The slight increase of 133 employees in the continuing operations since year-end 2012 is principally due to the increase in headcount in connection with growth-driven investments.

Employees by segment

	March 31,	Dec. 31,
	2013	2012
Consumer, Health & Nutrition	6,878	6,821
Resource Efficiency	5,806	5,755
Specialty Materials	6,229	6,134
Services	11,825	11,900
Other operations	2,076	2,071
Continuing operations	32,814	32,681
Discontinued operations (Real Estate)	641	617
Evonik	33,455	33,298

5. Events after the reporting date

On April 8, 2013 Evonik issued a €500 million bond under the debt issuance program launched in February 2013. The bond has a maturity of seven years and a coupon of 1.875 percent. The issue price was 99.185 percent.

Trading in shares in Evonik Industries AG commenced on the stock exchanges in Frankfurt am Main and Luxembourg on April 25, 2013.

6. Expected development

As an international Group with a diversified portfolio, Evonik is exposed to a wide range of opportunities and risks. These are described in detail in the report on expected development and the risk report in the Group management report for 2012. There have not been any fundamental changes since then, so the statements are still applicable. Given the measures planned and implemented, no risks have been identified that—either individually or in conjunction with other risks-could jeopardize the continued existence of Evonik.

Global economic conditions will remain very challenging, especially in the coming months, but we expect the global economy to pick up perceptibly in the second half of the year. Consequently, we assume that our forecast for the global economic environment from year-end 2012 remains applicable for 2013. Nevertheless, there is still considerable uncertainty, especially in connection with the sovereign debt crisis in Europe and the economic development of China. This could impair economic development.

In view of the reclassification of the Real Estate segment to discontinued operations in March 2013 and the planned deconsolidation of these operations in the course of 2013, the following comments only refer to the continuing operations. The corresponding figures for 2012 have been restated.

Despite the moderate start to 2013, given the anticipated upturn in the second half of the year, we are confirming our outlook for 2013. Assuming that the economic forecast for the year as a whole proves correct, we still expect to report a successful business performance in 2013. We assume that the new production capacities and higher selling prices in key product areas will have a positive impact. Overall, we anticipate higher sales in 2013, while the operating results should be in line with the very good level achieved in 2012.

Consolidated interim financial statements as of March 31, 2013

Contents

Income statement	19
Statement of comprehensive income	20
Balance sheet	21
Statement of changes in equity	22
Cash flow statement	23
Notes	24
Segment report	24
General information	26
Accounting policies	26
Changes in the Group	29
Notes to the income statement	31
Notes on the segment report	32

Other disclosures

T,

Income statement

Evonik Group

	1st quarter
in $\epsilon$ million	2013	2012
Sales	3,263	3,407
Cost of sales	$-2,316$	$-2,354$
Gross profit on sales	947	1,053
Selling expenses	$-314$	$-302$
Research and development expenses	$-95$	$-92$
General administration expenses	$-157$	$-156$
Other operating income	289	274
Other operating expenses	$-274$	$-349$
Income before financial result and income taxes, continuing operations	396	428
Interest income	10	$\overline{7}$
Interest expense	$-76$	$-87$
Result from investments recognized at equity	13	12
Other financial income	6
Financial result	$-47$	$-68$
Income before income taxes, continuing operations	349	360
Income taxes	$-83$	$-114$
Income after taxes, continuing operations	266	246
Income after taxes, discontinued operations	20	20
Income after taxes	286	266
thereof attributable to
Non-controlling interests	$-3$	$-3$
Shareholders of Evonik Industries AG (net income)	289	269
Earnings per share in $\epsilon$ (basic and diluted)	$+0.62$	$+0.58$

Prior-year figures restated.

Statement of comprehensive income

Evonik Group

		1st quarter
in $\epsilon$ million	2013	2012
Income after taxes	286	266
Comprehensive income that will be reclassified subsequently to profit or loss	34	$-28$
Unrealized gains/losses on available-for-sale securities	$-7$	$\overline{a}$
Unrealized gains/losses on hedging instruments	$-15$	36
Currency translation adjustment	50	$-57$
Deferred taxes	6	$-11$
Comprehensive income that will not be reclassified subsequently to profit or loss	5	$-486$
Actuarial gains and losses relating to pension plans and other
post-employment benefits	8	$-692$
Deferred taxes	$-3$	206
Other comprehensive income after taxes	39	$-514$
Total comprehensive income	325	$-248$
thereof attributable to
Non-controlling interests	$-3$	$-4$
Shareholders of Evonik Industries AG	328	$-244$

Prior-year figures restated.

Balance e sheet

Evonik Group

	March 31,	Dec. 31,
in € millio on	2013	20 012
Intangi ble assets	3,144	3,1 190
Propert ty, plant and e equipment	4,559	4,4 497
Investm ment property	7	1,5 550
Investm ments recogniz zed at equity	617	1,1 122
Financi al assets	162	1 197
Deferre ed tax assets	771	8 842
Other i ncome tax ass sets	21	21
Other r receivables	30	35
Non-curr rent assets	9,311	11,4 454
Invento ories	1,811	1,7 718
Other i ncome tax ass sets	95	79
Trade a accounts receiv vable	1,873	1,6 687
Other r receivables	390	3 367
Financi al assets	656	1,0 086
Cash an nd cash equiva alents	563	7 741
	5,388	5,6 678
Assets held for sale	2,313	34
Current a assets	7,701	5,7 712
Total ass ets	17,012	17,1 166
Issued capital	466	4 466
Reserve es	4,791	4,8 892
Equity a attributable to o shareholders of Evonik Ind ustries AG	5,257	5,3 358
Equity a attributable to o non-controll ing interests	106	1 111
Equity	5,363	5,4 469
Provisio ons for pensio ons and other p post-employm ent benefits	4,279	4,3 380
Other p provisions	711	7 799
Deferre ed tax liabilitie es	401	4 413
Other i ncome tax liab bilities	122	1 115
Financi al liabilities	909	1,4 464
Other p payables	95	3 309
Non-curr rent liabilities	6,517	7,4 480
Other p provisions	1,127	1,1 130
Other i ncome tax liab bilities	171	2 223
Financi al liabilities	1,471	1,4 483
Trade a accounts paya ble	1,068	1,0 096
Other p payables	300	2 272
	4,137	4,2 204
Liabiliti ies associated with assets he eld for sale	995	13
Current l iabilities	5,132	4,2 217
Total equ uity and liabilit ties	17,012	17,1 166

Prior-year figu ures restated.

Statement of changes in equity

Evonik Group

					Attributable
					to
					shareholders of	Attributable to
					Evonik	$non-$
	Issued				Industries	controlling	Total
	capital	Reserves			AG	interests	equity
				Accumulated other
			Capital Accumulated	comprehensive
in $\epsilon$ million		reserve	income	income
As of December 31, 2011	466	1,165	4,568	$-218$	5,981	93	6,074
Adjustments pursuant to
IAS 8	$\equiv$		$-653$		$-653$	$\overline{a}$	$-653$
As of January 1, 2012	466	1,165	3,915	$-218$	5,328	93	5,421
Capital increases/
decreases	$\bar{ }$	$\overline{\phantom{0}}$	$\overline{a}$	$\overline{a}$		$\overline{2}$	$\overline{c}$
Dividend distribution	$\bar{ }$	-	$-425$	$\overline{\phantom{0}}$	$-425$	$-5$	$-430$
Income after taxes	$\overline{\phantom{a}}$	$\overline{a}$	269		269	$-3$	266
Other comprehensive
income after taxes	$\overline{\phantom{0}}$		$-486$	$-27$	$-513$	$-1$	$-514$
Total comprehensive
income	$\qquad \qquad -$	$\overline{a}$	$-217$	$-27$	$-244$	$-4$	$-248$
Other changes	$\qquad \qquad -$	-				$-2$	$-2$
As of March 31, 2012	466	1,165	3,273	$-245$	4,659	84	4,743
As of January 1, 2013	466	1,165	3,940	$-213$	5,358	111	5,469
Dividend distribution	$\overline{a}$	$\overline{a}$	$-429$	$\equiv$	$-429$	$\qquad \qquad -$	$-429$
Changes in ownership
interests in subsidiaries
without loss of control	$\bar{ }$	$\overline{a}$		$\overline{\phantom{0}}$		$-2$	$-2$
Income after taxes	$\overline{\phantom{0}}$	$\overline{\phantom{0}}$	289	$\overline{a}$	289	$-3$	286
Other comprehensive
income after taxes	$\overline{\phantom{a}}$	$\overline{\phantom{0}}$	5	34	39	$\overline{\phantom{a}}$	39
Total comprehensive
income	$\overline{\phantom{a}}$		294	34	328	$-3$	325
Other changes	$\overline{a}$	$\equiv$	1	$-1$		$\overline{a}$
As of March 31, 2013	466	1,165	3,806	$-180$	5,257	106	5,363

Prior-year figures restated.

Cash fl ow statem ment

Evonik G Group

		1st quarter
in € million n	201 13	2012 2
Income b before financial r result and incom me taxes, continu uing operations	396	428
Deprecia ation, amortizatio on, impairment losses/reversal o of impairment lo osses on non-cu urrent assets	144	217
Gains/lo sses on the disp posal of non-cur rent assets	1	-6
Change i in inventories	-126	-47
Change i in trade account s receivable	-194	- -183
Change i in trade account s payable and cu urrent advance p payments receive ed from custome ers	8	4
Change i in provisions for r pensions and o other post-emplo oyment benefits	-33	-37
Change i in other provisio ons	-18	63
Change i in miscellaneous s assets/liabilitie es	70	-12
Cash out tflows for interes st	-16	-14
Cash infl lows from intere est	5	9
Cash infl lows from divide ends	36	21
Cash infl lows/outflows fo or income taxes	-81	-79
Cash flow f from operating a activities, contin uing operations s	192	364
Cash flow w from operating g activities, disc ontinued operat tions	21	19
Cash flow f from operating a activities	213	383
Cash out tflows for investm ments in intangi ble assets, prop perty, plant and e equipment, inve stment property y	-219	- -166
Cash out tflows for investm ments in shareh oldings	-2	-1
Cash infl lows from divest tments of intang gible assets, prop perty, plant and equipment, inve estment property y	13	9
Cash infl lows/outflows fr rom divestment of shareholdings s	-7	-8
Cash infl lows/outflows re elating to securit ties, deposits an nd loans	362	-67
Cash flow f from investing a activities, continu uing operations	147	- -233
Cash flow w from investing g activities, disco ontinued operati ions	8	5
Cash flow f from investing a activities	155	- -228
Cash infl lows/outflows re elating to capital l contributions	-	2
Cash out tflows for divide nds to sharehold ders of Evonik In ndustries AG	-429	-
Cash out tflows for divide nds to non-cont trolling interests s	-	-2
Cash infl lows/outflows fr rom changes in o ownership intere ests in subsidiar ies without loss of control	-2	-
Cash infl lows from the ad ddition of financ ial liabilities	48	82
Cash out tflows for repaym ment of financia l liabilities	-120	-67
Cash flow f from financing a activities, contin uing operations	-503	15
Cash flow w from financing g activities, disco ontinued operati ions	-	30
Cash flow f from financing a activities	-503	45
Change in cash and cash e equivalents	-135	200
Cash and c cash equivalents as of January 1	741	1 ,411
Change i in cash and cash h equivalents	-135	200
Changes in exchange rat tes and other ch anges in cash an nd cash equivale ents	7	-1
Cash and c cash equivalents as of March 31	613	1 ,610
Cash and d cash equivalen nts included in as ssets held for sa ale	-50	-3
Cash and c cash equivalents as on the balan ce sheet as of M March 31	563	1 ,607

Prior-year figu ures restated.

Notes

1. Segment report

By operating segments-1st quarter

	segments
	Consumer,
	Health &		Resource
	Nutrition		Efficiency			Specialty Materials		Services
in $\epsilon$ million	2013	2012	2013		2012	2013	2012	2013	2012
External sales	1,035	1,055	771		818	1,170	1,234	236	256
Internal sales	16	21		15	14	32	30	411	450
Total sales	1,051	1,076	786		832	1,202	1,264	647	706
Adjusted EBITDA	274	287	172		168	182	215	54	53
Adjusted EBITDA margin in %	26.5	27.2	22.3		20.5	15.6	17.4	22.9	20.7
Adjusted EBIT	240	254	143		131	145	178	32	32
EBIT	240	253	138		60	140	175	28	28
Capital expenditures	60	45		37	28	50	54	21	15
Financial investments		$\qquad \qquad -$			-	$\overline{2}$	$\overline{\phantom{0}}$
Employees as of December 31	6878	6.604	5.806		6.029	6229	6.710	11825	11 490

Reporting

Prior-year figures restated.

By regions-1st quarter

	Germany			Other European countries		North America
in $\epsilon$ million	2013	2012		2013	2012	2013	2012
External sales	777	829		1,071	1,056	576	628
Goodwill as of March 31 1	1,557	1,556		541	541	286	274
Other intangible assets, property, plant and equipment, investment property as of March 311)	2,909	2,754		476	525	669	587
Capital expenditures	65	89		18	14	24	28
Employees as of March 31	21.396	20.812		2.735	2,840	3.783	3,936

Prior-year figures restated.

¹⁾Non-current assets according to IFRS 8.33 b.

Real Estate e (discontinu ued operations )		T s segments	Total reporting			Corpor rate, other operat tions, consol lidation, less discon ntinued operat tions			Total Group (continuing operations)
2013	2012	2013	2012 2		20 013	2012		2013	2012
54	49	3,266	3 ,412		-3	-5		3,263	3,407
–	-	474	515		-4 474	-515		–	-
54	49	3,740	3 ,927		-4 477	-520		3,263	3,407
42	41	724	764		-1 35	-108		589	656
77.8	83.7	22.2	22.4		–	–		18.1	19.3
30	30	590	625		-1 45	-116		445	509
30	29	576	545		-1 61	-105		415	440
6	4	174	146		9	15		183	161
–	-	3	-		–	1		3	1
641	579	31,379	31 ,412		1,4 435	1,325		32,814	32,737

Central and America	d South	A Asia-Pacific		Middle	e East, Africa	Total Group (continuing operations)
2013	2012	2013	2012 2	20 013	2012	2013	2012
204	207	556	614	79	73	3,263	3,407
27	26	262	270	1	1	2,674	2,668
45	45	926	806	11	8	5,036	4,725
11	2	64	28	1	-	183	161
447	424	4,342	4 ,631	1 11	94	32,814	32,737

2. General information

Evonik Industries AG is an international specialty chemicals company headquartered in Germany. It also has investments in residential real estate and the energy sector.

At the start of 2013, the previous sole owners of Evonik Industries AG-RAG-Stiftung and Gabriel Acquisitions GmbH (Gabriel Acquisitions), Gadebusch (Germany)—sold some of their shares to German and foreign institutional investors through private placements.

The present condensed and consolidated interim financial statements (consolidated interim financial statements) of Evonik Industries AG and its subsidiaries (referred to jointly as Evonik or the Group) as of March 31, 2013, have been prepared in accordance with the provisions of IAS 34 Interim Financial Reporting, and in application of Section 315 a Paragraph 3 of the German Commercial Code (HGB) using the International Financial Reporting Standards (IFRS) and comply with these standards. The IFRS comprise the standards (IFRS, IAS) issued by the International Accounting Standards Board (IASB), London (UK) and the interpretations (IFRIC, SIC) of the IFRS Interpretations Committee (IFRS IC), as adopted by the European Union.

The consolidated interim financial statements as of March 31, 2013 are presented in euros. The reporting period is January 1 to March 31, 2013. All amounts are stated in millions of euros (€ million) except where otherwise indicated. The basis for the consolidated interim financial statements comprises the consolidated financial statements for the Evonik Group as of December 31, 2012, which should be referred to for further information.

3. Accounting policies

The accounting and consolidation principles applied in these consolidated interim financial statements are the same as those used for the consolidated financial statements as of December 31, 2012, with the exception of changes resulting from mandatory application of new or revised reporting standards. The changes in 2013 are outlined below.

As of January 1, 2013, Evonik retrospectively applied IAS 19 Employee Benefits (revised 2011), which the IASB published in June 2011, in conjunction with the transition provisions of IAS 19 (2011), together with IAS 8 Accounting Policies, Changes in Accounting Estimates and Errors.

The following amendments in IAS 19 (2011) have a material impact on Evonik's consolidated financial statements. IAS 19 (2011) abolishes the corridor method previously used by Evonik. Under this method, actuarial gains and losses were recognized with a time lag and only if they exceeded certain thresholds. Now they have to be recognized immediately in full in other comprehensive income. Another effect results from the immediate recognition of non-vested past service cost in profit or loss as it arises. The previous method of recognition over the period until it became vested is no longer permitted. Another impact comes from net interest cost/income, which replaces interest cost and the expected income from plan assets. The expected return on plan assets is no longer calculated on the basis of expected investment income, but is assumed to be equal to the discount rate for pension obligations. Top-up and termination benefits under the German phased early retirement model and long-term accounts are no longer immediately expensed in full, as was the case in the past. Instead, they are amortized over the remaining term of active employment. This change also affects Evonik's consolidated financial statements.

The following tables summarize the effects of the amended financial reporting standard on the comparative data as of December 31, 2012, the opening balance sheet as of January 1, 2012 and the prioryear period.

	Dec. 31, 2012			Jan. 1, 2012
	Before	Impact of	Restated	Before	Impact of	Restated
in $\epsilon$ million	restatement	change	amount	restatement	change	amount
Investments recognized at equity	1,132	$-10$	1,122	1,057	$-1$	1,056
Deferred tax assets	329	513	842	477	235	712
Non-current assets	10,951	503	11,454	11,026	234	11,260
Total assets	16,663	503	17,166	16,944	234	17,178
Reserves	6,252	$-1,360$	4,892	5,515	$-653$	4,862
Equity attributable to shareholders of Evonik
Industries AG	6,718	$-1,360$	5,358	5,981	$-653$	5,328
Equity	6,829	$-1,360$	5,469	6,074	$-653$	5,421
Provisions for pensions and other
post-employment benefits	2,377	2,003	4,380	2,805	1,030	3,835
Other provisions	889	$-90$	799	1,014	$-102$	912
Deferred tax liabilities	463	$-50^{1}$	413	481	$-411$	440
Non-current liabilities	5,617	1,863	7,480	7,484	887	8,371
Total equity and liabilities	16,663	503	17,166	16,944	234	17,178

Balance sheet Evonik Group (excerpt)

¹⁾ Offset against deferred tax assets

In the first quarter of 2012 the effects of the amended standard on income before financial result and income taxes, continuing operations essentially canceled each other out. They comprised income of €6 million, mainly from the abolition of amortization of actuarial gains and losses, which was countered by the newly required recognition of expenses for top-up payments under the German phased early retirement program amounting to €6 million. The introduction of net interest cost and the lower interest resulting from the reduction in personnel-related provisions resulted in insignificant income or rather a negligible reduction in expenses in the financial result in the first quarter of 2012.

Statement of comprehensive income Evonik Group (excerpt)

	January 1, 2012 to March 31, 2012
	Before	Impact of	Restated
in $\epsilon$ million	restatement	change	amount
Comprehensive income that will be reclassified subsequently to profit or loss	$-30$	2	$-28$
Currency translation adjustment	$-59$	2	$-57$
Comprehensive income that will not be reclassified subsequently to profit or loss	-	-486	-486
Actuarial gains and losses relating to pension plans and other post-employment benefits	$\equiv$	$-692$	$-692$
Deferred taxes	-	206	206
Other comprehensive income after taxes	$-30$	$-484$	$-514$
Total comprehensive income	236	-484	$-248$
thereof attributable to
shareholders of Evonik Industries AG	240	$-484$	$-244$

Compare before fin 2013, wh pension p d with the ol nancial result hile the finan plans and oth ld version of t and income cial result de her post-em IAS 19, the a e taxes, cont eclined by ab ployment be application o inuing opera bout €10 mill nefits in the of IAS 19 (20 ations by aro ion. The actu statement o 11) increased und €19 mill uarial gains a f comprehen d the reporte lion in the fir and losses re nsive income ed income rst quarter of elating to is a new item fm.

IFR by Evonik 13 prescr disclosur applicatio statemen RS 13 Fair Va k as of Janua ribes uniform es on fair va on of IFRS 13 nts apart from lue Measurem ry 1, 2013, i m rules for th lue. It does n 3 in the repor m additional ment, which n accordance he measurem not provide in rting period h disclosures i was adopted e with the tra ment of fair va nformation o had no signi n the notes. d by the IASB ansition prov alue across v on when fair ficant impact in May 2011 visions conta various stand value is to be t on the cons 1, was applie ined in this s dards and ext e used. First solidated fina ed prospectiv standard. IFR tends the -time ancial vely RS

In J Compreh income, i reclassifie June 2011 th ensive Incom nterim amou ed to profit o he IASB issue me (amendme unts must be or loss. Evon d Presentatio ents to IAS 1 e shown for it ik has applie on of Financi ). This stipul tems depend ed these ame ial Statement lates that in t ding on whet endments sin ts: Presentati the presenta her these ite ce January 1 ion of Items ation of other ems might su , 2013. of Other r comprehen ubsequently b sive be

Sin Disclosur instrume nce January 1 res issued by nts did not h , 2013, Evon y the IASB in have a signifi nik has also a December 20 cant impact applied the a 011. The sup on the conso amendments pplementary olidated finan to IFRS 7 Fin disclosures o ncial stateme nancial Instru on the offset ents: uments. tting of finan ncial

Evo Improvem applicabl standards onik applied ments 2009 e transition p s. The amend the amendm 2011 Cycle r provisions. T ded standard ments to IFRS retrospective These amend ds did not ha 1, IAS 1, IAS ely for the fir ments comp ave a materia S 16, IAS 32 a st time as of prise improve al impact on t and IAS 34 is January 1, 2 ements and c the consolida ssued as part 2013, in conj clarification o ated financia t of the Annu unction with of existing al statements ual the s.

Du 31, 2012 view. Cas securities in cash an as of Janu ue to the reas , the followin sh and cash e s, deposits an nd cash equi uary 1, 2012 ssessment of ng prior-yea equivalents a nd loans with ivalents drop . f possible flu r data in the as of March 3 hin the cash pped by this a uctuations in cash flow st 31, 2012 wer flow for inve amount and the value of atement hav re reduced by esting activiti cash and cas some curren e been restat y €282 millio es increased sh equivalent nt securities ated to reflect on, cash outf d by €82 mill ts were €200 as of Decem t the current flows for ion, the chan 0 million lowe ber nge er

Evo period. T compared onik is publis his has resul d with the pr shing an inte lted in chang rior-year qua erim manage ges to the str arter. ment report ructure of no for the Grou otes to the co p for the firs onsolidated fi st time in thi inancial state s reporting ements

4. Chan nges in the Group

4.1 S Scope of con nsolidation

The scop e of consolid dation chang ed as follows s in the repo rting period:

Change s in the sco ope of conso olidation

		Ot her
Number o of companies	German ny	countr ries	T Total
Evonik Ind dustries AG an nd consolidate d subsidiaries s
As of D ecember 31, 2 2012	6 67	1 07	174
Other c ompanies con solidated for t the first time	1	–	1
Intragro oup mergers	- -1	-2	-3
Other c ompanies dec onsolidated	- -1	-4	-5
As of M March 31, 2013 3	6 66	1 01	167
Investmen nts recognized d at equity
As of D ecember 31, 2 2012	1 11	8	19
Divestm ments	- -1	–	-1
Classifi ed as held for sale pursuant t to IFRS 5	- -3	–	-3
As of M March 31, 2013 3	7	8	15
	7 73	1 09	182

4.2 A Acquisitions s and divest tments

In the rep consolida porting perio ation. od there were e no acquisiti ions or dives tments that had a materi ial impact on n the scope o of

4.3 A Assets held for sale and d discontinu ued operati ons

In accord bundled i 2013 the Superviso ance with its in the Real Es Executive Bo ory Board of s focus on sp state segmen oard of Evon Evonik Indus pecialty chem nt (Real Estat ik Industries stries AG on M micals, Evonik te group of c AG adopted March 11, 20 k intends to w companies he a phased pl 013. withdraw from eaded by Viva an for this, w m the real es awest GmbH which was ap state activitie H). In Februar pproved by th es ry he

Evo control th onik intends his company. to divest the e majority of the shares i n Vivawest G mbH in 2013 3 and will th us no longer

Un Non-curr to be use til then, the rent Assets H ed for such o .assets and li Held for Sale perations an abilities of th and Disconti d their prese he Real Estat inued Operat entation in th te segment w tions sets ou he consolidat will be classif t the valuatio ted financial fied as held f on and accou statements. for sale. IFRS unting princi r5 ples

As liabilities not have sets held for on the balan to be reclass r sale and the nce sheet. Th sified or resta e associated he amounts r ated. liabilities hav recognized fo ve to be stat or these asse ed separately ets and liabili y from other ities in the p r assets and revious year do

Bu for classi The incom sinesses who fication as d me and expe ose assets an iscontinued o enses of such nd liabilities operations, e h discontinue have been cl especially if a ed operations assified as h a separate, s s have to be eld for sale m ignificant bu stated separ may also me usiness area i rately from th et the criteria is to be sold. hose of a.

continuin period fig ng operations gures in the i s in the incom income state me statemen ement have to nt. The cash f o be restated flows also ha d. ave to be stat ted separatel ly. The prior--

Th as discon e Real Estate ntinued opera e segment's a ations. activities earm marked for d divestment in n 2013 meet the criteria f for classificat tion

Th broken d e following t own into ope table shows t erating incom the main imp me and the g pact of the di ain or loss o iscontinued o n divestmen operations on t: n the income e statement,

Income statement

	Operati after ta xes	ing income	Divestme gains/los taxes	nt ses after	Income afte er taxes, discontinue ed operations
	1	st quarter	1st	quarter	1st q uarter
in € millio on	2013 3	2012	2013	2012	2013	2012
Real Estat te segment	20	19 9		- -	20	19
Other disc continued ope erations	-	- -		- 1	-	1
	20	19 9		- 1	20	20

The follow wing income e and expens e items relat te to the ope rating incom me of the Rea l Estate segm ment:

Income statement
		1st quarter
in € millio on	2 013	201 2
Income	64	56
Expense es	-42	-36
Operating g earnings bef ore income tax xes, discontin ued operation s		20
Income taxes	-2	-1
Operating g earnings afte er taxes, disco ntinued opera ations	20	19

The follow wing table sh hows the ass ets held for sale and the associated l iabilities afte er all consolid dation steps:

Balance sheet

Balance sheet
	March 3 31,	Dec. . 31,
in € millio on	20 013	2 012
Intangi ible assets	40	-
Propert ty, plant and e equipment	26	6
Investm ment property	1,5 534	-
Investm ments recogniz zed at equity	489 4	-
Financi ial assets	38	-
Deferre ed tax assets	33	3
Other i ncome tax ass sets	17	-
Invento ories	59	7
Trade a accounts recei vable	24	16
Other r receivables	2	2
Cash a nd cash equiv alents	51	-
Assets he eld for sale	2,3 313	34
Provisio ons for pensio ons and other post-employm ment benefits	1 06	-
Other p provisions	68	1
Deferre ed tax liabilitie es	4	1
Other i ncome tax liab bilities	22	-
Financi ial liabilities	555 5	8
Trade a accounts paya ble	7	3
Other p payables	233 2	-
Liabilities s associated wi ith assets held d for sale	995 9	13

5. Note es to the inc come statem ment

The other currency other ope to curren included r operating i translation o erating expen cy translatio impairment ncome of €2 of monetary a nses of €274 n of moneta losses. 89 million m assets and lia 4 million rela ry assets and mainly compr abilities, the ated, among o d liabilities. I ised income reversal of p other things, n the previou from the me provisions, an , to the meas us year, oper easurement o nd insurance surement of rating expen of derivatives e refunds. Th derivatives a ses also s, he and

Th to previo e income rat us periods. te for the con ntinuing oper rations was 2 24 percent, m mainly as a re esult of tax i ncome relati ng

6. Notes on the segment report

The Executive Board of Evonik Industries AG decides on the allocation of resources and evaluates the earnings power of the Group's operations on the basis of the operating segments described below (subsequently referred to as segments). The operating activities are divided into business units within the segments. The reporting based on segments reflects the Group's internal organizational and reporting structure (management approach).

In accordance with Evonik's focus on specialty chemicals and to align the regional allocation of companies and business operations to its peers, the Executive Board of Evonik Industries AG has decided to divest the real estate operations bundled in the Real Estate segment. The impact on the segment reporting is as follows:

The Real Estate segment, which is classified as held for sale, see Note 4.3, is shown in the segment reporting as a discontinued operation, but is nevertheless still a reporting segment. In order to present the Group's continuing operations, the Real Estate segment is then deducted via "Corporate, other operations, consolidation less discontinued operations".

The table shows a reconciliation from adjusted EBIT for the reporting segments to income before income taxes for the Group's continuing operations:

Reconciliation of adjusted EBIT for the reporting segments to income before income taxes

	1st quarter
in $\epsilon$ million	2013	2012
Adjusted EBIT, reporting segments	590	625
Adjusted EBIT, other operations	$-11$	-8
Adjusted EBIT, Corporate Center and corporate activities	$-90$	$-70$
Consolidation	$-14$	$-8$
less adjusted EBIT of discontinued operations	$-30$	$-30$
Adjusted EBIT, Corporate, other operations, consolidation, less discontinued operations	$-145$	-116
Adjusted EBIT, Group (continuing operations)	445	509
Adjustments	$-30$	-69
Net interest expense	$-66$	$-80$
Income before income taxes, continuing operations	349	360

Prior-year figures restated.

The impact of the retrospective application of IAS 19 (2011) increased the operating results previously reported for the first quarter of 2012, i.e. the adjusted EBIT and adjusted EBITDA of the Group (continuing operations), by €6 million, while adjustments were reduced by €6 million.

7. Other disclosures

$7.1$ Fair value

The fair value determination is based on the 3-level hierarchy in IFRS 13:

• Level 1: Quoted price in an active market $\ddot{\phantom{a}}$
• Level 2: Ouoted price in an active market for similar financial instruments or valuation methods based on observable market data
• Level 3: Valuation methods not based on observable market data

The following table shows the assets and liabilities that are measured at fair value on a recurring basis after initial recognition on the balance sheet:

Measurement at fair value pursuant to IFRS 13

				March 31,
	Fair value based on		2013
in $\epsilon$ million	Level 1	Level 2	Level 3
Assets measured at fair value	580	46	89	715
Securities and similar claims	580	$\overline{\phantom{0}}$	-	580
Receivables from derivatives	$\overline{\phantom{a}}$	46	89	135
Liabilities measured at fair value	$\qquad \qquad$	$-53$	$-68$	$-121$
Liabilities from derivatives	$\overline{\phantom{0}}$	$-53$	$-68$	$-121$

Level 2 derivatives comprises currency, interest rate and commodity derivatives whose fair value is determined on the basis of the exchange rates at the European Central Bank, observed interest rate structure curves and observed commodity prices. The discount effect on these derivatives is negligible.

The fair values shown under Level 3 result from the valuation of the put option and the call option for the remaining 49 percent shareholding in STEAG and, to an insignificant extent, from derivatives embedded in supply contracts. Recognized option pricing models are used to measure these derivatives.

During the reporting period, no derivatives were reclassified to other levels.

Reconciliation from the opening to the closing balances for fair values (Level 3)

	Receivables from derivatives	Liabilities from derivatives	Total
in $\epsilon$ million
As of January 1, 2013	97	$-65$	32
Additions	-	$-1$	$-1$
Gains or losses in the reporting period	$-8$	$-2$	$-10$
Other operating income	-
Other operating expenses	$-8$	$-3$	-11
As of March 31, 2013	89	-68	21

As of March 31, 2013, the net value of the put and call options for the remaining 49 percent of the shares in STEAG was €21 million. The key factors influencing the valuation are the formula-based option strike price and an estimate of the fair value of 49 percent of the shares in STEAG. If the fair value of the 49 percent stake in STEAG had been 10 percent lower on March 31, 2013, the net value of the options would have been €53 million higher and would have resulted in an additional unrealized gain of the same amount. A 10 percent increase in the fair value of the 49 percent stake in STEAG as of March 31, 2013 would have reduced the net value of the options by $E$ 54 million, resulting in a corresponding additional unrealized loss.

The balance sheet as of March 31, 2013 contains assets and liabilities that are measured at fair value on a non-recurring basis totaling €22 million. These are contained in assets held for sale and the associated liabilities. The net fair value derived from the loss-free valuation of these assets and liabilities is allocated to Level 2 of the fair value hierarchy. The main input factor for the valuation is the expected proceeds from sale less the costs to sell.

The following overview shows the carrying amounts and fair values of all financial assets and liabilities:

Fair value and carrying amounts of financial assets		March 31, 2013
	Carrying amount	Fair value
in $\epsilon$ million
Financial assets	818	819
Other investments	16	16
Loans	62	62
Securities and similar claims	580	580
Receivables from finance leases
Receivables from derivatives	135	135
Other financial assets	25	25
Trade accounts receivable	1,873	1,873
Cash and cash equivalents	563	563

Fair value and carrying amounts of financial liabilities		March 31, 2013
	Carrying
	amount	Fair value
in $\epsilon$ million
Financial liabilities	2,380	2,502
Bonds	1,848	1,945
Liabilities to banks	298	321
Loans from non-banks	42	42
Liabilities from finance leases	5	7
Liabilities from derivatives	121	121
Other financial liabilities	66	66
Trade accounts payable	1,068	1,068

$7.2$ Contingent receivables and liabilities

Further insurance refunds are expected in connection with the incident at a production plant in Marl (Germany). The amount has not yet been finalized.

There has not been any material change in contingent liabilities since the annual financial statements as of December 31, 2012.

$7.3$ Related parties

The principal transactions with related parties that have taken place since December 31, 2012 are as follows:

Sales revenues of €29 million were recorded with the joint venture Vivawest Wohnen GmbH from leasing the real estate to be managed by this company.

In the first quarter of 2013 a dividend for 2012 was paid to the shareholders, RAG-Stiftung and Gabriel Acquisitions. The dividend payment to RAG-Stiftung was €296 million, while Gabriel Acquisitions received a dividend of €81 million.

$7.4$ Events after the reporting date

On April 8, 2013 Evonik issued a €500 million bond under the debt issuance program launched in February 2013. The bond has a maturity of seven years and a coupon of 1.875 percent. The issue price was 99.185 percent.

Trading in shares in Evonik Industries AG commenced on the stock exchanges in Frankfurt am Main and Luxembourg on April 25, 2013.

Essen, April 26, 2013 Evonik Industries AG The Executive Board

Dr. Engel Dr. Haeberle Dr. Colberg Dr. Yu Wessel Wohlhauser

Credits

Published by Evonik Industries AG Rellinghauser Straße 1 - 11 45128 Essen www.evonik.de

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