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Ernst Russ AG

Quarterly Report May 27, 2009

5393_10-q_2009-05-27_7d6e503c-c8a8-4631-a0c3-88d0aa670472.pdf

Quarterly Report

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HCI THREE-MONTH REPORT 2009

Key fi nancial indicators

Three months ended Three months ended
Earnings March 31, 2009 March 31, 2008
Revenues in EUR thousands 9,989 26,488
EBIT in EUR thousands - 2,943 3,034
EBT in EUR thousands - 2,287 1,640
Group net earnings in EUR thousands - 2,493 1,238
Earnings per share in EUR - 0.10 0.05
Placed equity in EUR million 30.1 153.7
Balance sheet March 31, 2009 December 31, 2008
Total assets in EUR thousands 163,937 172,586
Equity in EUR thousands 83,325 86,200
Equity ratio in % 50.8 % 50.0 %
Staff March 31, 2009 March 31, 2008
Average employees 295 280
Personnel costs in EUR thousands 6,045 5,420

HCI Capital AG Share

Hint: Rounding differences likely to occur.

The ongoing fi nancial and economic crisis with huge downturns in manufacturing and trading meant that the industry got off to a poor start in 2009, as was expected. This trend was one that the HCI Group was unable to buck. With its extensive sales network and its diversifi ed product range the Group was still able to place funds, but it did so at a level that marked a further sharp decline compared with last year's weak fourth quarter. At present there are no signs of a swift recovery by the world economy, yet we still see favourable medium and long-term prospects for investment in tangible assets. This is the background against which the HCI Group's management and employees see the main focus of our activities as being on close dialogue with sales partners and on active asset and fund management.

Continuing investor restraint at the beginning of 2009

High investor uncertainty and restraint continue to characterise the market for closed funds. The only exceptions are direct investment in the real estate sector, products in aircraft funds and a selection of special funds, all of which are currently popular. All other asset classes, not least ship funds, once again reported considerable losses on the fourth quarter of 2008. Against this backdrop the equity capital that the HCI Group placed in the fi rst quarter of the 2009 fi nancial year was down substantially on both the last quarter of 2008 (EUR 91.0 million) and the fi rst quarter of the previous year (EUR 153.7 million) to a total of EUR 30.1 million. This poor result was due largely to widespread investor restraint. The Group nevertheless continued to place capital in all product areas, with classic ship funds alone contributing about EUR 10.4 million toward the placement result. Guarantee products and asset creation plans, both investing mainly in ship funds, made further signifi cant placement contributions of EUR 5.4 million and EUR 7.3 million respectively. Placements in other asset classes were secondary life insurance market funds (EUR 4.4 million), HCI Deepsea Oil Explorer (EUR 2.0 million), HCI Real Estate G7 (EUR 0.8 million) and HCI Aircraft One (EUR 1.4 million).

Q1 result marked by placement decline – Cost reduction programme takes effect

The weak course of placement in the fi rst quarter was the main reason why the HCI Group has a negative net result of EUR -2.5 million to report for the period to 31 March 2009. This fi gure includes EUR 0.9 million in impairments that were due to market conditions. We have reduced non-personnel costs by about 19 % on the previous year. They are now within the planned cost reduction corridor of about EUR 7 million for the full year.

Gaining trust with close dialogue and new products – low interest rates and infl ation risks boost positive prospects for tangible assets

To regain momentum in placement business, the HCI Group has initiated a series of measures aimed at reinforcing the confi dence of our sales partners and investors in investing in closed-end funds. They include in particular close dialogue with the sales partners that we have maintained at about 150 regional sales events since the beginning of the year. After all, the current low level of interest rates, combined with the risks of infl ation brought about by the worldwide expansion in the volume of money, signals that investing in tangible assets is gaining in attractiveness. This is shown by external studies that underscore our aim to offer investors in our products sound long-term investments in tangible assets.

In our product design, we have devised for the Deepsea Oil Explorer a new guarantee product version in the second quarter, thereby adding to our successful Protect range. Current market development shows that safety is a foremost consideration for investors at present. In addition, the Group launched a new solar fund, HCI Energy 1 Solar, at the beginning of the second quarter. We see brisk current demand for this product area. Last but not least, we have plans to develop other new products around our established business segments in order to cater for investors' needs even better in this diffi cult environment. These include in particular a new ship fund that as an addition to our established ship products is aligned as an opportunity fund.

Focus on active asset and fund management

At the same time, managing an asset pipeline of about 80 ships in these diffi cult conditions remains a fundamental challenge for the HCI Group. To tackle it we are holding talks with banks, shipping companies and shipyards to draw up sustainable medium and long-term solutions for all parties. In the prevailing economic climate the existing portfolio also cannot be expected to perform normally and according to plan in the case of a number of funds. This will pose a further challenge for the entire industry in 2009 and will require close monitoring and active fund management. We have put this management in place accordingly at the HCI Group in order to ensure the long-term success of our investors' equity investments. In the present market environment it is clearer than ever that issuing houses are not just intermediaries and trustees for closed-end funds, but active asset managers for entrepreneurial investments.

Best wishes,

Hamburg, May 2009

Dr. Ralf Friedrichs (Chairman of the Management Board)

The share

In an environment still characterised by uncertainties as to where the world economy was heading, global stock markets continued to show volatile development in the reporting period. After an initial sharp decline in market indices at the beginning of the year, stock markets have latterly recovered perceptibly. After the latest upward trend the German DAX index closed on 31 March 2009 at 4,084 points. In the course of this development the MDAX index of midrange companies closed on 31 March 2009 at 4,426 points, while the SDAX ended the reporting period at 2,374 points.

Against this background the HCI share price similarly began by falling further. In the reporting period the share traded at very low daily levels in a price range that varied between EUR 1.10 at the beginning of March and EUR 2.09 at the beginning of January. The share price on 31 March 2009 was EUR 1.42.

HCI Capital AG is currently followed by seven analysts who supply the capital market with regular assessments of the HCI share. At present, four analysts give the share a "Hold" and three a "Reduce" rating.

Interim management report

A. Economic environment

Overall economic development

The fi rst three months of the 2009 fi nancial year have demonstrated that the general forecast of an international economic downturn has become a reality. International manufacturing, trading and investment activity showed a further decline in the reporting period. It can be stated in general that the gross domestic product of the United States, the entire EU, Japan and the emerging market countries has declined. China and India in particular are exceptions for which, however, signifi cantly lower growth than in past years is anticipated.

In Germany too the recession continued in the reporting period after a weak fourth quarter in 2008. Exports in particular have been affected and, in view of Germany's strong dependence on the trade balance, make a substantial contribution toward the decline in real gross domestic product. The increasingly poor order situation has prompted many companies to switch to part-time working. At the same time, existing orders have been cancelled, and inventories thereby increased signifi cantly.

Against the background of international economic setbacks there are no signs yet of recovery in the shipping markets. Instead, the global crisis in manufacturing and trading affects nearly all shipping segments. In 2008 the highest rates since the record levels in 2005 were paid for container ships of all sizes. Since the fourth quarter of 2008 freight rates have declined dramatically. In view of the decline in world trade and the fall in demand for commodities, container shipping and bulk carriers (bulkers) are especially hard hit.

While no upward trend has been apparent on the demand side during the reporting period, capacity reduction is increasingly being stepped up on the supply side. Existing surplus capacities in the reporting period led nonetheless to a fl eet of about 500 container ships lying idle. At the same time, it must also be noted that no more newbuild orders are in the market and that orders placed in previous years are up for negotiation on a wide front with a view to reaching agreement on cancellations, delivery postponements or reallocation of construction orders. In addition, the scrapping ratio for container ships rose by 176 % at the end of 2008 alone. In the fi rst quarter of 2009 a further 46 ships were consigned to be scrapped. The current ageing of the bulker fl eet with rates at an extremely low level is another occasion for shipping companies to scrap more ships and reduce surplus capacities signifi cantly. In the fourth quarter of 2008 the scrapping quota rose from nearly nil to about 90 ships with a deadweight (DWT) totalling 5.5 million tons. A further 99 ships with a DWT of 4.08 million tons were scrapped in the fi rst two months of 2009 (source: Clarkson Research).

A further fundamental obstacle to an upward trend in the bulk shipping market is the present restrictive policy pursued by banks in granting loans to fi nance trading. As soon as the banks make funding available for trading once more it could contribute toward a recovery in this market segment. After a severe downturn in the fourth quarter of 2008 the Baltic Dry Index has shown signs of recovery once more. This upward trend is still at a low overall level, but it does at least indicate that the fall in rates has bottomed out. It can generally be said of the trend in shipping markets in the reporting period that the self-healing properties of the market are starting to take effect. A sustainable recovery in shipping markets is however not yet in sight.

In the global measures undertaken to stabilise the precarious international economic situation, important and essential steps have been taken to strengthen the fi nancial system. These comprehensive steps consist of a recapitalisation of the banks' weakened equity capital base and government guarantees to reinforce inter-bank trading. At the same time, the world's most important central banks have shifted their focus from maintaining monetary stability to stimulating the economy. As a result the US Federal Reserve has cut interest rates to between 0.0 % and 0.25 %. In addition, the European Central Bank has cut its interest rate by a further 25 basis points to 1.0 %, the lowest level since the euro was introduced, while the Bank of England has reduced its base rate to 0.5 %.

Furthermore, governments of leading industrialised and emerging market countries have put in place signifi cant national economic booster packages to stimulate consumer demand and investment and thereby countervail the economic downturn or even a backslide into a lengthy depression.

Another positive factor is the low price of oil, which has levelled out at around USD 50 per barrel after peaking at about USD 140 per barrel in 2008. The marked fall in commodity-driven infl ation is strengthening consumer purchasing power and easing the burden on the manufacturing industries.

Along with the ongoing easing of tension on commodity exchanges the US dollar weakened further during the reporting period. At the end of 2008 the dollar exchange rate was EUR 1.39. As at 31 March 2009 it was down further to EUR 1.32.

Industry developments

Against a backdrop of further weak economic development and an ongoing high level of uncertainty about the extent and duration of the fi nancial and economic crisis, during the reporting period investors continued to show clear restraint as regards investment products. This has affected the development of the market for closed-end funds considerably. Overall placement volume has continued to fall since the slump in the fourth quarter of 2008. The only exceptions are direct investment in real estate, aircraft funds and a selection of special funds, meaning that the market has generally stabilised in comparison to the last quarter of 2008.

Latest fi gures for new issues of closed-end participations authorised by the German Federal Financial Supervisory Authority (BaFin) in the reporting period are also about 55 % down on the previous year. The changes in framework conditions are refl ected in the design of fund products. The average size of funds in all asset classes other than new energy is down. This trend makes it clear that the market for closed-end funds has adjusted on the supply side to a weak course of placement in 2009.

Course of business

Against this background the HCI Group sustained a signifi cant decline in placement volume to about EUR 30.1 million (previous year: EUR 153.7 million). Due to the regional positioning of sales and the intensive dialogue with sales partners, HCI has succeeded in continue to place investments in all asset classes and does so continuously, but at a level in the reporting period that is lower still than in the fourth quarter of 2008.

With a product base that is now signifi cantly wider we have realigned our presentation to the following investment product areas: Transport and Logistics, Energy and Commodities, Real Estate and the Secondary Life Insurance Market. Within these areas the placement of equity capital is as follows:

The Transport and Logistics product area comprises the asset classes Ship and Aircraft. In this area the HCI Group placed EUR 22.9 million (previous year: EUR 81.2 million) in the fi rst quarter of 2009. With a EUR 21.5 million total equity capital placement in Ship investments this continues to be the largest asset area in the HCI portfolio. It includes EUR 10.4 million in classic participation models, EUR 5.7 million in participations in asset creation plans and EUR 5.4 million in guarantee products (HSC Shipping Protect 3 and Multi Asset Protect). In the Aircraft asset class EUR 0.8 million was placed in HCI Aircraft One participations and EUR 0.5 million in Aufbauplan 8.

The Energy and Commodities product area consisted in the reporting period of the HCI Deep Sea Oil Explorer, which is to be joined in the second quarter 2009 by a guaranteed capital version of this product, and of the Group's fi rst solar power fund, HCI Energy 1 Solar. In the reporting period roughly EUR 2.0 million was placed in HCI Deepsea Oil Explorer.

Against the background of the current market environment, a total volume of just EUR 0.8 million was placed in the Real Estate product area, consisting of HCI Real Estate 7. The fund is oriented toward investment opportunities in the G7 countries and thereby offers investors a very interesting investment alternative in the current market environment. In general, however, it must be stated that direct investment in real estate is more popular with investors at present.

In the Secondary Life Insurance Market product area a total of EUR 4.4 million was placed in the reporting period via the current HSC Optivita XI UK product along with asset creation plans.

B. Financial perfomance, net assets and cash fl ows

I. Financial performance

The sharp decline in the placement result achieved by the HCI Group in the fi rst quarter of 2009 was due mainly to developments in the fi nancial market and uncertainty among investors. Against this background revenues totalled EUR 10.0 million, which was about 62.3 % down on the previous year's EUR 26.5 million.

Sales and fund design revenues in the fi rst quarter of 2009 were at EUR 4.1 million still well below the previous year's EUR 20.5 million. Trust and service fee revenues at EUR 5.3 million were down slightly on the previous year's EUR 5.5 million. Revenues from management fees were up slightly on the year from EUR 0.5 million to EUR 0.6 million.

In the 2009 fi nancial year no signifi cant other operating income was earned in the fi rst quarter from ship or real estate brokerage. At EUR 0.4 million it was considerably lower than the previous year's EUR 1.0 million.

The cost of purchased services in the reporting period, consisting mainly of commission paid to sales partners, was

Equity capital placed in Q1 2009

Product area Q1 2009 Q1 2008 Δ Δ %
Ship 10,388 50,300 - 39,912 - 79.3 %
HSC asset creation plan placed 2,350 6,650 - 4,300 - 64.7 %
HSC guarantee product placed 90 8,855 - 8,765 - 99.0 %
Ship certifi cates *) 5,463 - 5,463
Guarantee products 5,405 17,553 - 12,148 - 69.2 %
Ship asset creation plan 5,711 7,899 - 2,188 - 27.7 %
Aircraft 834 *) 834
HSC asset creation plan placed 235
Aircraft asset creation plan 539 539
Transport and Logistics 22,877 81,215 - 44,541 - 54.8 %
Real Estate 832 33,111 - 32,279 - 97.5 %
Life insurance 3,311 37,003 - 33,692 - 91.1 %
Asset creation plan 1,084 726 358
Life Insurance 4,395 37,729 - 33,334 - 88.4 %
Deepsea Oil Explorer 1,984 *) 1,984
Energy and Commodities 1,984 1,984
Other *) 1,648 - 1,648
Total 30,088 153,703 - 123,615 - 80.4 %

*) No products in placement

down by about 75.7 % on the year from EUR 13.8 million to EUR 3.3 million. This disproportionate reduction in commission expenses compared with the fall in revenues shows that income from trust management activities is weighted more heavily in revenues. The 67.9 % gross yield margin in the fi rst quarter of 2009 was signifi cantly higher than the previous year's 47.1 %.

Personnel expenses rose by EUR 0.6 million to EUR 6.0 million in the fi rst three months of the fi nancial year. That was due mainly to the increase from 280 to 295 in the higher average number of employee capacities in the reporting period. Compared with the fourth quarter of the 2008 fi nancial year (303), employee capacities were down by eight.

Other operating expenses to the reporting date amounted to EUR 4.2 million, which was 19.2 % lower than the previous year's EUR 5.2 million. The fall in non-personnel was due mainly to lower consulting expenses compared with the same period in the previous year.

Investment income from associated and joint ventures calculated in accordance with the equity method totalled EUR 0.4 million in the reporting period, or less than the previous year's EUR 0.9 million. The main earnings contribution came from HAMMONIA Reederei GmbH & Co. KG (EUR 0.9 million). Costs incurred by eFonds Holding AG totalled EUR -0.3 million. The decline in investment income was due mainly to the discontinuation of income from Aragon AG (previous year: EUR 0.4 million) and NY Credit Operating LP (previous year: EUR 0.3 million).

In view of the course of business as described, earnings before interest and taxes (EBIT) for the period 1 January to 31 March 2009 were EUR -2.9 million, or signifi cantly less than the previous year's EUR 3.0 million.

The fi nancial result at EUR 0.6 million was EUR 1.9 million above the previous year's EUR -1.3 million. Interest income was down EUR 0.7 million to EUR 0.3 million, while interest expenses fell from EUR -1.1 million to EUR -0.7 million. This was due mainly to repayment of the loan for the acquisition of shares in Aragon AG that were sold in the third quarter of 2008. The increase in the other fi nancial result from EUR -0.9 million in the previous year to EUR 1.0 million in the reporting period was due mainly to positive effects of the weak US dollar exchange rate on the foreign currency result.

Earnings before taxes (EBT) totalled EUR -2.3 million in the reporting period and were therefore well below the previous year's EUR 1.6 million.

Taxes on income and profi ts in the fi rst three months of 2009 amounted to EUR 0.2 million.

The consolidated net result for the period was EUR -2.5 million, again lower than the previous year's EUR 1.3 million.

II. Cash fl ows

As at 31 March 2009 the HCI Group generated a positive cash fl ow of EUR 5.5 million from operating activities. This year-on-year improvement was due mainly to the positive cash fl ow from the EUR 1.7 million decrease in earmarking of working capital (previous year: EUR 4.7 million capital buildup) and to EUR 5.5 million in tax refunds from previous years compared with EUR 5.1 million in taxes paid in the previous year.

The EUR 1.1 million negative cash fl ow from investment activities was primarily the result of investment in other fi nancial assets and in associated companies. Compared with the previous year, cash fl ow from investment activities improved by EUR 5.0 million, as in the fi rst quarter of 2008 the shares in eFonds Holding AG were acquired.

Repayment of fi nancial liabilities led to a EUR 2.4 million negative cash fl ow from fi nancing activities.

The result to 31 March 2009 was a EUR 1.9 million increase in fi nancial resources to EUR 31.2 million. Compared with the previous year the fi nancial position improved by EUR 2.7 million.

III. Net assets

Total assets as of 31 March 2009 of EUR 163.9 million was down by EUR 8.6 million as at 31 December 2008. This change was mainly a result of the fall in trade receivables (EUR 8.0 million) and of tax receivables less an increase in cash and cash equivalents (EUR 1.9 million) and in at equity investments in associated companies and joint ventures (EUR 2.5 million).

The decline in trade receivables was due largely to lower sales in the fi rst quarter of 2009 as described above, but also to more rigorous claims management.

The increase in at equity investments in associated companies and joint ventures was a result of the positive earnings contribution made by HAMMONIA Reederei GmbH & Co. KG and of pro rata changes in fair value of derivatives in cash fl ow hedging stated as a change in equity capital not affecting net income.

Equity was down by EUR 2.9 million from 31 December 2008 to EUR 83.3 million as at 31 March 2009. The equity ratio rose from 50.0 % to 50.8 % as at 31 March 2009. This was due in particular to a proportionately higher repayment of liabilities.

Current provisions and liabilities rose by EUR 17.6 million. This change was due mainly to a shift of the majority of debts classifi ed as non-current as at 31 December 2008 and as current as at 31 March 2009 due to their terms to maturity. In the fi rst quarter of the 2009 fi nancial year other fi nancial obligations fell from EUR 9.5 million to EUR 6.9 million and trade payables by EUR 2.4 million to EUR 6.0 million.

C. Events subsequent to the balance sheet date

No events of material importance for the HCI Group have occurred since the balance sheet date.

D. Report on risks and opportunities

I. Risks regarding future performance

The business risks inherent in the HCI Group's business model and its risk management system are described in detail in the 2008 Annual Report on pages 50–59.

The current risk position is essentially unchanged on the position outlined in the 2008 Annual Report. Relevant parameters have since changed in respect of the following risks:

  • (4.1.1.) The assessment in the risk report for the 2008 fi nancial year that charter rates are currently diffi cult to predict has proved accurate. It has since been shown that charter rates have come under very serious shortterm pressure due to uncertainties in international goods trading. Further hedging cannot currently be ruled out. Shipowners are trying to respond with signifi cantly shorter charter terms in order to profi t as soon as possible from a forthcoming recovery in charter rates. If charter rates continue to fall there may be serious repercussions on the profi tability of individual ship funds and individual associated companies. The result could be a threat to the HCI Group's market reputation.
  • (4.2 and 9.3.2.) In the course of the fi nancial market crisis investors continue to exercise restraint with regard to investment products of all kinds. This includes investment in closed-end funds. For the HCI Group that leads to signifi cantly higher sales risks for fund products already on sale or already designed and ready for sale. Placement guarantees for funds currently on sale extend as a rule well into 2009 and, in the case of ship funds, until the end of 2009. Subject to negotiation with the banks there is also a possibility of prolonging placement guarantees if necessary. In cooperation with fund companies and with the banks the HCI Group has made use of this option for a number of funds with placement guarantees that would have fallen due in the fi rst half of 2009 and has thereby prolonged the sales period and, with it, the placement guarantee. This is also conceivable for other funds for which the due dates of placement are before the end of 2009. If it were to become necessary to take over parts of individual funds temporarily as inventory, the HCI Group would need to raise interim funding accordingly. Such interim funding has not currently been pledged. Placement would either be resumed at a later date or other suitable solutions, such as the sale of investment items, would be considered.

  • (4.2 and 9.3.2.) Due to the ongoing market weakness and to reports on the further development of the lessee Air Canada, placement of the HCI Group's aircraft fund, HCI Aircraft One, has been made more diffi cult. As a result, the fund's structure is under review. Initial successes have been achieved with the bank, and the placement guarantee was extended until the end of the year.

  • (9.3.1.) Market conditions in individual shipping market segments have not recovered over the past three months. The HCI Group is counteracting the risk of projects not being placeable as a fund investment due to further weakness of shipping markets by holding intensive talks with shipyards, shipping companies and fi nancing banks. Initial successes have been achieved in postponing delivery dates.
  • To summarise the above-mentioned risks of an ongoing combination of weak shipping markets, tight credit markets and restraint in investor interest, there is a considerably increased risk of recourse to contingent liabilities being required. A signifi cant resulting liquidity requirement could only be limited or guaranteed by cooperative behaviour on the part of the banks. The HCI Group's continued existence is otherwise at risk. The Group is holding intensive talks with its main funding partners to forestall any such recourse.

II. Opportunities regarding future performance

The opportunities that exist for HCI Group business in the 2009 fi nancial year were described in detail in the Report on risks and opportunities in the 2008 Annual Report (pages 50–59). They apply unchanged. Against the backdrop of the current market development special mention must be made of the following opportunities:

  • On the investment side the current crisis in the shipping segment also provides entry opportunities from which interesting offers can be designed for investors. The HCI Group with its extensive experience in this sector and its good relations with shipping companies and other market players could derive special benefi t from these opportunities. A number of new products are at the design stage that will enable fund management to respond fl exibly to market opportunities and thereby achieve attractive returns for investors in hard times.
  • The present low-interest policy accompanied by a sharp increase in government debt makes infl ationary tendencies seem likely in the medium term. Investments in tangible assets will then become highly attractive propositions. The HCI Group could derive special benefi t from this trend by virtue of its well-fi lled and highly diversifi ed product pipeline and its strong sales network.

  • The higher risk profi le of providers of closed-end funds arising from the fi nancial market crisis will in our view hit smaller competitors especially hard – competitors who are less well established with their products, are less networked in sales and have a lower credit standing and fi nancial strength on the capital side. Against this backdrop there is an opportunity that the repercussions of the fi nancial market crisis might favour a consolidation of the market for closed-end funds from which the HCI Group as one of the leading and most experienced providers in the market could benefi t.

  • In view of developments in the course of the fi nancial market crisis we anticipate that the sector providing closedend participation models and the independent providers of fi nancial services, who make a considerable contribution toward HCI's placement success, will be subjected to stricter regulatory control. In respect of further regulation of independent fi nancial advisers, via a stake in eFonds AG the HCI Group offers its services in providing an adequate liability cover solution for this group of sales partners. The Group thereby stands to benefi t overall from further industry consolidation in the course of stricter market regulation.
  • Future fi nancing arrangements will require a higher equity capital input. As a stock market-listed company the HCI Group is able to position itself better than its competitors in this environment.

E. Outlook

Overall economic outlook

Overall economic development for the remainder of 2009 continues to face considerable uncertainties. Economic research institutes are agreed that the world economy is experiencing a downturn. Forecasts differ, however, on the extent and duration of this period of economic weakness. It remains diffi cult to estimate the degree to which the many fi nancial and economic stimulus packages agreed in the leading economies, some of which are substantial, will take effect and how quickly this will happen.

Most economic research institutes have downgraded their forecasts for the year 2009 yet again. These downward forecast revisions relate to the United States, the Asian economies, Russia and also the EU economic area. Forecasts for the EU range from -1.0 % (source: HWWI) to -3.3 % (source: Institut für Weltwirtschaft). The factors contributing to the Institut für Weltwirtschaft's downward forecast adjustment (earlier forecast: -2.7 %) are even more signifi cant falls in corporate investment, worse forecasts for world trade and the high export dependence level of Europe's largest economy, Germany. Forecasts for Germany have been downgraded from -2.7 % to -3.3 % by the Institut für Weltwirtschaft. In their 2009 Spring Report the leading German economic research institutes go even further. They say Germany is in a deep recession that will cause the economy to shrink by up to 6 %. As a result the number of short-time workers in Germany will rise to about 1.3 million (source: 2009 Spring Report). If there is no improvement in companies' order positions by autumn 2009 further negative infl uences on employment must be assumed. Against the backdrop of the two economic stimulus packages agreed, however, positive trends are noted and said to indicate that the decline in manufacturing output has bottomed out. Even so, a sustainable stabilisation is not anticipated before mid-2010. A faster recovery is seen as feasible provided that the international banking crisis can be resolved swiftly and bank lending returns to normal as soon as possible.

The sector

Due to the ongoing fi nancial and economic crisis investors will in our view continue for the time being to feel uncertain about all forms of investment. This will continue to pose a serious challenge for the providers of closed-end funds in respect of both new business and the management of asset pipelines and existing funds. On balance it is hard to say how the market will develop in 2009. That will depend mainly on the extent and duration of the economic slump. Analysts feel that in particular direct investment in real estate, energy funds and fashionable products such as forestry funds will continue to have better prospects. In addition, guarantee-backed and opportunist fund concepts, i.e. blind pools geared to making use of favourable entry opportunities in a weak market environment, could benefi t.

Business development

The market trend remains diffi cult and will pose a serious challenge to the HCI Group in the further course of the 2009 fi nancial year. In view of ongoing uncertainty as to the general economic trend, a reliable full-year business forecast for 2009 is impossible. The HCI Group is however well on its way to reaching its non-personnel costs reduction target of about EUR 7.0 million. It will be accompanied by stringent ongoing cost controlling with a view to making consistent use of further cost reduction potential.

In the second quarter of 2009 the HCI Group is launching in its placement business a capital-guaranteed version of its Deepsea Oil Explorer product and its fi rst solar power fund, HCI Energy 1 Solar. For both products we foresee good prospects of successful placement in the course of the year with a projected volume of up to EUR 20.0 million and EUR 10.0 million respectively. In the second half of the year we have plans to develop further new products around our established product areas to cater for investors' needs even better in this diffi cult environment. These will in particular include a new ship fund that as an addition to our established ship products is aligned as an opportunity fund.

On balance, business development will to a large extent depend on the extent and rate at which the fi nancial sector and the economy overall recover from their serious downturns in the course of the year. Once tendencies toward recovery are apparent we foresee good opportunities for the HCI Group to regain placement momentum.

Consolidated statement of operations

for the period from January 1 to March 31, 2009

EUR '000 Note Three months
ended March 31,
2009
Three months
ended March 31,
2008
Revenues (3) 9,989 26,488
Other operating income (4) 382 950
Change in inventories 132 - 250
Cost of purchased services - 3,340 - 13,769
Personnel expenses - 6,045 - 5,420
Depreciation, amortisation and impairment of property, plant and equipment and
intangible assets
- 259 - 685
Other operating expenses - 4,243 - 5,240
Results of associated companies and joint ventures accounted for using the
equity method
441 960
Earnings before interest and taxes (EBIT) - 2,943 3,034
Interest income (5) 369 677
Interest and similar expenses (5) - 680 - 1,140
Other fi nancial result (5) 967 - 931
Earnings before taxes (EBT) - 2,287 1,640
Income taxes (6) - 206 - 402
Consolidated net result for the period - 2,493 1,238
Consolidated net loss for the period attributable to the group - 2,493 1,238
Earnings per share (basic) in EUR (7) - 0.10 0.05
Earnings per share (diluted) in EUR (7) - 0.10 0.05

Consolidated statement of comprehensive loss

for the period from January 1 to March 31, 2009

EUR '000 Three months
ended March 31,
2009
Three months
ended March 31,
2008
Consolidated net result for the period - 2,439 1,238
Changes in the fair value of derivatives in associated entities 952 - 1,878
Foreign currency translation adjustment - 1,334 - 709
Other comprehensive loss - 382 - 2,587
Total comprehensive loss - 2,875 - 1,349
Consolidated net loss for the period attributable to the group - 2,875 - 1,349

Consolidated balance sheet

as of March 31, 2009

March 31, December 31,
Note 2009 2008
ASSETS EUR '000 EUR '000
Non-current assets 85,445 82,736
Intangible assets 2,882 3,017
Property, plant and equipment 1,425 1,510
Investments in associated companies and in joint ventures accounted for using the equity
method
38,506 36,033
Other investments 22,978 22,628
Receivables from related parties 2,542 2,542
Other fi nancial assets 12,202 12,114
Deferred taxes 4,910 4,892
Current assets 78,492 89,850
Work in progress and fi nished services 2,484 2,352
Trade receivables 15,511 23,553
Receivables from related parties 17 27
Income tax receivables 7,823 13,114
Other assets 18,912 18,441
Other fi nancial assets 18,515 17,642
Other miscellaneous assets 397 799
Securities 2,502 3,059
Cash and cash equivalents 31,243 29,304
Total assets 163,937 172,586
EQUITY AND LIABILITIES EUR '000 EUR '000
Equity 83,325 86,200
Subscribed capital 24,000 24,000
Capital reserve 75,943 75,943
Retained earnings -56 2,437
Accumulated other equity
(8)
-2,030 -1,648
Net cost in excess of net assets acquired on the acquisition of companies under common
control and successive share acquisitions
-14,532 -14,532
Non-current provisions and liabilities 7,822 31,318
Pension provisions 23 22
Financial Debt
(9)
4,519 27,636
Other miscellaneous liabilities 0 19
Deferred taxes 3,280 3,641
Current provisions and liabilities 72,790 55,068
Other provisions 1,918 1,808
Financial Debt
(9)
39,093 16,837
Trade payables 6,023 8,457
Payables to related parties 1,288 1,538
Income tax payables 15,362 15,132
Other current liabilities 9,106 11,296
Other fi nancial liabilities 6,894 9,499
Other miscellaneous liabilities 2,212 1,797
Total equity and liabilities 163,937 172,586

Consolidated cash fl ow statement

for the period from January 1 to March 31, 2009

Three months Three months
ended March 31, ended March 31,
EUR '000 2009 2008
Consolidated net result for the period - 2,493 1,238
Depreciation, amortisation and impairment of intangible assets and property, plant and equipment 260 685
Losses(+) / gains(-) from associated companies and joint ventures - 441 - 960
Gains(-) from the disposal of intangible assets and property, plant, equipment and securities - 17 - 113
Increase in pension provisions 1 1
Elimination of income taxes 206 402
Elimination of net interest income and net investment income 541 1,394
Other non-cash income and expenses 1,158 602
Decrease / Increase in working capital 1,699 - 4,655
Increase in inventories - 132 275
Decrease in trade receivables 8,042 7,037
Increase / Decrease in other assets - 1,196 2,918
Increase in current provisions 102 275
Decrease in trade payables -2,434 - 9,193
Increase / Decrease in receivables from and payables to related parties - 239 - 1,139
Decrease in other liabilities - 2,049 - 4,489
Other movements in operating activities - 395 - 339
Taxes paid - 657 - 5,136
Taxes received 5,533 106
Interest paid - 499 - 300
Interest received 130 181
Distributions received 29 3,412
Cash fl ows from operating activities 5,450 - 3,143
Proceeds from disposals of intangible assets, property, plant and equipment as well as assets held for sale 0 49
Proceeds from disposal of other investments and securities 306 110
Payments for investments, intangible assets and property, plant and equipment - 40 - 121
Payments for investments in associated companies and interest in joint ventures - 708 - 6,025
Payments for other investments securities and long-term loans to related parties - 621 - 44
Cash fl ows from investing activities - 1,063 - 6,031
Proceeds from additions to fi nancial liabilities 0 6,000
Repayments of fi nancial liabilities - 2,448 - 3,040
Cash fl ow from fi nancing activities - 2,448 2,960
Net Changes in cash and cash equivalents 1,939 - 6,214
Cash and cash equivalents at beginning of period 29,304 34,739
Cash and cash equivalents at end of period 31,243 28,525

Consolidated statement of changes in equity

for the period from January 1 to March 31, 2009

Accumulated other equity
EUR '000 Subscribed
capital
Capital reserve Retained earn
ings
Income and
expenses
recognised
directly in
equity
in associated
entities
Foreign
currency trans
lation adjust
ment
Net cost in
excess of net
assets acquired
on the acquisi
tion of compa
nies under com
mon control
and successive
share acquisi
tions
Consolidated
equity
Balance at 01 Jan 2008 24,000 76.016 35,987 - 2,334 - 1,103 - 14,532 118,034
Transaction costs on capi
tal increase
0 - 73 0 0 0 0 - 73
Total comprehensive loss 0 0 1,238 - 1,878 - 709 0 - 1,349
Balance at 31 Mar 2008 24,000 75,943 37,225 - 4,212 - 1,812 - 14,532 116,612
Balance at 01 Jan 2009 24,000 75,943 2,437 - 333 - 1,315 - 14,532 86,200
Total comprehensive loss 0 0 - 2,493 952 - 1,334 0 - 2,875
Balance at 31 Mar 2009 24,000 75,943 - 56 619 - 2,649 - 14,532 83,325

Segment reporting

for the period from January 1 to March 31, 2009

EUR '000 Design & Sales
After Sales Services
Asset Management
2009 2008 2009 2008 2009 2008
Revenues 4,231 20,528 5,196 5,445 562 515
Change in inventories 132 - 224 0 0 0 - 26
Cost of purchased services - 3,340 - 13,664 0 0 0 - 105
Sales commissions - 2,846 - 12,676 0 0 0 0
Prospect costs - 494 - 988 0 0 0 - 105
Gross margin 1,023 6,640 5,196 5,445 562 384
Other operating income 78 54 327 326 101 706
Personnel expenses - 2,725 - 2,540 - 1,536 - 1,471 - 252 - 182
Depreciation - 42 - 45 - 11 - 308 - 90 - 92
Other operating expenses - 1,783 - 2,836 - 1,154 - 1,107 - 189 - 252
Results of associated companies and joint
ventures accounted for using the equity
method
- 257 446 0 0 698 211
Earnings before interest and taxes (EBIT) - 3,706 1,719 2,822 2,885 830 775
Segment assets 20,742 27,461 33,171 32,759 37,087 39,398

Segment reporting ist part of the notes to the consolidated interim fi nancial statements as of March 31, 2009.

Operating Segment Total Others / Holding Consolidation HCI Group
2009 2008 2009 2008 2009 2008 2009 2008
9,989 26,488 0 0 0 0 9,989 26,488
132 - 250 0 0 0 0 132 - 250
- 3,340 - 13,769 0 0 0 0 - 3,340 - 13,769
- 2,846 - 12,676 0 0 0 0 - 2,846 - 12,676
- 494 - 1,093 0 0 0 0 - 494 - 1,093
6,781 12,469 0 0 0 0 6,781 12,469
506 1,086 778 826 - 902 - 962 382 950
- 4,513 - 4,193 - 1,532 - 1,227 0 0 - 6,045 - 5,420
- 143 - 445 - 116 - 240 0 0 - 259 - 685
- 3,126 - 4,195 - 2,019 - 2,007 902 962 - 4,243 - 5,240
441 657 0 303 0 0 441 960
- 54 5,379 - 2,889 - 2,345 0 0 - 2,943 3,034
91,000 99,618 0 0 0 0 91,000 99,618

to the consolidated interim fi nancial statements of HCI Capital AG as of 31 March 2009

GENERAL

(1) Information about the Company and the Group

HCI Capital AG, with its registered offi ce at Bleichenbrücke 10, 20354 Hamburg, Germany, is registered with the Register of Companies (Handelsregister) of the Hamburg District Court (Amtsgericht, HRB 93324).

The Company's subscribed capital amounts to EUR 24,000,000 and is divided into 24,000,000 no-par value registered shares. Since its initial public offering (IPO) in October 2005 and the related admission to trading on the regulated market, the Company has been listed in the Prime Segment of the Frankfurt Stock Exchange and on the Hamburg Stock Exchange.

HCI Capital AG and its subsidiaries (hereinafter referred to as the HCI Group) together constitute a service group operating principally in Germany. The Group's business activities consist primarily of the design and initiation of closed-end funds in the main product areas Transport and Logistics, Real Estate, Life Insurance, Energy and Commodities, and Private Equity as well as the subsequent raising of funds from institutional and retail investors. Furthermore, the Group operates as fi duciary manager of equity capital placed and of fund assets (aftersales services, asset management).

(2) Accounting and Valuation methods

HCI Capital AG's consolidated interim fi nancial statements as of 31 March 2009 were prepared in accordance with the provisions of IAS 34, with the notes presented in condensed form in accordance with IAS 34.10.

With the exception of the following changes, the accounting policies used in the preparation of the Group's consolidated interim fi nancial statements correspond to those used in HCI Capital AG's consolidated IFRS fi nancial statements as of 31 December 2008. Therefore, the consolidated interim fi nancial statements as of 31 March 2009 should be read in conjunction with the consolidated fi nancial statements as of 31 December 2008.

As stated in Note (4) to the consolidated IFRS fi nancial statements as of 31 December 2008, the HCI Group is applying IFRS 8 "operating segments" for the fi rst time in the 2009 fi nancial year. Segment information for the fi rst quarter of 2009 as stated in this consolidated interim fi nancial statements was drawn up on the basis of this standard. Comparative information for the fi rst quarter of 2008 was adjusted accordingly. In accordance with IFRS 8, which is based on the management approach, segment reporting consists of a presentation of reportable operating segments that correspond to the areas of a company for which the Group's chief operating decision maker regularly assesses the earning power and allocation of resources on the basis of available fi nancial information. In accordance with the internal product areas monitored by HCI Capital AG's Management Board, Design and Sales, After-Sales Services and Asset Management were defi ned as operating segments. With regard to segment reporting for the fi rst quarter of 2009 we refer to Note (10).

In the consolidated interim fi nancial statements as of 31 March 2009 the HCI Group makes fi rst-time use of the provisions of IAS 1 "Presentation of Financial Statements" as revised in 2007. The statement of comprehensive income comprising income and expenses recognized in profi t and loss and directly in equity has been added as a component of the fi nancial statements.

In the fi rst quarter of 2009 the HCI Group changed the recognition for revenues from sales and design services. Until 31 December 2008 sales and design revenues were recognised when the investor signed and the statutory or, if longer, contractual cancellation period expired. They are now recognised when HCI accepts the signed contract, taking into account the anticipated cancellation quotas within the statutory or, if longer, contractual cancellation period. Cancellation quotas are calculated per product areas on the basis of historic experience over a period of up to fi ve years taking into account margin developments or other special factors for the product category in question. Using this new accounting method for the 2008 fi nancial year and the fi rst quarter of 2009 would have led to revenue adjustments of EUR 304,000 and EUR 106,000 respectively and to adjustments of cost of purchased services amounting to EUR 272,000 and EUR 92,000. Due to immateriality the fi nancial information therefore not adjusted retroactively as per IAS 8 but in profi t ande loss of the period.

Other standards or interpretations applied for the fi rst time had no impact on the HCI Group's net assets, fi nancial performance and cash fl ows.

Application of the following standards and interpretations published by the IASB and IFRIC prior to the preparation of the consolidated interim fi nancial statements was not mandatory as at the balance sheet date because they had either not yet been endorsed by the EU or their fi rst time of mandatory use had yet to be stated:

  • Amendment to IFRS 3 "Business Combinations"
  • Amendment to IFRS 1 "First Time Adoption of IFRS"
  • IFRIC 15 "Agreements for the Construction of Real Estate"
  • IFRIC 16 "Hedges of a Net Investment in a Foreign Operation"
  • IFRIC 17 "Distributions of Non-Cash Assets of Owners"
  • IFRIC 18 "Transfers of Assets from Customers"
  • Amendment to IAS 27 "Consolidated and Separate Financial Statements"
  • Amendment to IAS 39 "Financial Instruments: Recognition and Measurement: Eligible Hedged Items"
  • Amendment to IAS 39 "Reclassifi cation of Financial Assets: Effective Date and Transition"

  • Amendment to IFRIC 9 and IAS 39 "Embedded Derivates"

  • "2007–2009 Annual Improvements Project"

They will be implemented when their use is fi rst mandatory. The HCI Group's current assumption is that application of these standards will have no material impact for the presentation of its net assets, fi nancial performance and cash fl ows.

The effects on the Group's net assets, fi nancial performance and cash fl ows of the amendments to IAS 27 and IFRS 3 will depend in particular on such acquisitions or disposals of interst in companies that the HCI Group undertakes after the date of fi rst-time application of these two standards.

NOTES TO THE CONSOLIDATED INCOME STATEMENT

(3) REVENUES

Revenues break down as follows:

01.01. – 01.01. –
EUR '000 31.03.2009 31.03.2008
Transport and Logistics 2,980 12,014
Real Estate 174 3,448
Energy and Commodities 417 0
Secondary Life Insurance Market 507 4,821
Private Equity 0 177
Design and Sales 4,078 20,460
Transport and Logistics 4,202 4,493
Real Estate 609 425
Energy and Commodities 53 0
Secondary Life Insurance Market 342 486
Private Equity 99 98
After-Sales Services 5,305 5,502
Asset Management 572 526
Other 34 0
Total revenues 9,989 26,488

Due to the adjustment of product area structure in the fi rst quarter of 2009 the HCI Group has adjusted the break down of Design and Sales and After-Sales Services revenues for the fi rst quarter of 2008 accordingly. The Transport and Logistics product area comprises the asset classes Ship and Aircraft. The Energy and Commodities product area consists of the HCI Deep Sea Oil Explorer and has been extended to include the HCI Energy 1 Solar fund.

(4) Other operating income

Other operating income (EUR 382,000; previous year: EUR 950,000) includes EUR 333,000 in cost refunds and other income. The previous year's fi gure included EUR 644,000 in sales tax refunds for real estate brokered.

(5) Financial Result

Other fi nancial results include EUR 703,000 (previous year: EUR 570,000) in fees received by the HCI Group as advance distributions from the secondary life insurance market funds. They also include EUR 558,000 in impairments and EUR 754,000 in foreign exchange gains (previous year: EUR 1.671 million in foreign exchange losses).

(6) Taxes on income and profi ts

Taxes on income and profi ts include current tax expenditure totalling EUR 584,000, including EUR 84,000 in expenses incurred in previous years, and EUR 378,000 in deferred tax income.

(7) Earnings per share

Basic and diluted earnings per share were as follows:

01.01. –
31.03.2009
01.01. –
31.03.2008
Group share of the net result for the period EUR '000 - 2,493 1,238
Weighted average number of shares issued '000s of shares 24,000 24,000
Earnings per share for the period EUR - 0.10 0.05

During the periods presented there were no instruments with a dilutive effect. Diluted earnings per share therefore correspond to basic earnings per share.

NOTES TO THE CONSOLIDATED BALANCE SHEET

(8) Accumulated other equity

Accumulated other equity consists of changes in fair value of fi nancial instruments available for sale and reconciling items from translating fi nancial statements denominated in a foreign currency. In addition, it includes pro rata income and expenses from associated companies and joint ventures accounted for al at equity without effect on net income.

(9) Fiancial Debt

Financial liabilities are the amounts owed by the HCI Group to banks. The following are the principal terms and conditions involved:

Loans Book value
31.03.2009
EUR '000
Book value
31.12.2008
EUR '000
Loan
currency
Interest
rate in %
Final due date
HSH Nordbank AG 29,867 28,579 USD LIBOR + 3 % 2010
Bankhaus Wölbern & Co. 6,778 6,481 USD EURIBOR + 1,85 % 2011
Dresdner Bank AG 4,500 5,995 EUR 5,22 % – 8,83 % 2009
HSH Nordbank AG 2,441 3,383 EUR 6,24 % – 9,03 % 2009

For interim fi nancing of the acquisition of an interest in eFonds Holding AG in 2008, HCI Capital AG took out a cash loan of EUR 6.0 million. In January 2009 the HCI Group repaid EUR 1.5 million. In February 2009 agreement was reached with Dresdner Bank AG that the loan was in the future to be repaid in quarterly instalments of EUR 150,000 with payment of the fi nal instalment on 31 January 2010. The interest rate will be 7.5 %.

OTHER INFORMATION

(10) Segment information

Segment data was collected on the basis of the fi nancial information used in internal reporting and corresponds to the accounting policies used for the consolidated fi nancial statements.

Reportable operating segments as per IFRS 8 are as follows:

  • Design and Sales This segment includes the HCI Group's activities in relation to the identifi cation of suitable investment vehicles, product design and product sales.
  • After-Sales Services The After-Sales Services segment primarily comprises investor services, including advising investors with regard to all corporate law and regulatory issues associated with their fund investments and to the fi duciary management of their capital investments.
  • Asset Management The management of investment vehicles of the funds launched by the HCI Group in the areas of shipping, real estate and life insurance funds, as well as the activities as a ship managing company with third parties, are allocated to the Asset Management segment.

In addition, there is a Holding / Other area that includes items not directly attributable to the above segments as well as expenses pertaining to the holding function.

Segment results are stated as earnings before interest and taxes (EBIT), which is the result for the period before interest and other fi nancial results and before income taxes and is used in internal controlling in accordance with IFRS as the segment performance fi gure. In internal reporting the revenues and expense categories are included that are shown in the consolidated statement of operations.

The segment assets held by operating units include the assets that are relevant for operating activities in the segment in question. They consists of inventories, trade receivables, loans granted and loans to sales partners, funds and ordering companies along with HCI Group shareholdings in funds or ordering companies and at equity shareholdings in associated companies and joint ventures. Goodwill totalling EUR 1.465 million as at 31 March 2009 is not allocated to segment assets.

In accordance with IFRS 8 reporting does not include segment liabilities, since they are not included in internal reporting.

The reconciliation of segment assets with the Group's balance sheet total is as follows:

EUR'000 31.03.2009 31.12.2008
Segment assets 91,000 99,618
Cash and cash equivalents 31,243 29,304
Securities 2,502 3,059
Deferred tax refunds 4,910 4,893
Tangible fi xed assets 1,425 1,510
Intangible assets 2,883 3,017
Other assets and receivables 29,479 30,579
Other fi nancial assets 495 606
Group assets 163,937 172,586

(11) Contingencies and other fi nancial commitments

As at 31 March 2009 the Company had the following material contingencies and other fi nancial commitments:

31.03.2009 31.12.2008
EUR'000 EUR'000 USD'000 EUR'000 EUR'000 USD'000
Guarantees 1,519,834 346,061 1,558,536 1,480,102 343,761 1,578,036
of which drawn 968,204 266,705 931,451 941,295 256,918 950,395
Placement guarantees 645,234 272,987 494,269 639,182 263,997 521,019
of which for funds not 251,382 60,327 253,683 248,093 60,477 260,543
Future payments under operating leases 3,294 3,294 -- 3,566 3,566 --

In connection with the purchase of the assets underlying fund design and fund structuring by special purpose entities, in which as a rule the HCI Group and a partner hold a joint share, the HCI Group has regularly provided placement guarantees to secure construction phase loans and interim fi nancing. If the investment and construction phase loans and interim fi nancing cannot be repaid as scheduled due to weak markets and pending fundraising, the HCI Group is exposed to the risk, particularly in the shipping segment, of being called upon within the scope of such contingent liabilities if the special purpose entity concerned does not obtain an extension or prolongation of the fi nancing commitment from the banks involved. The currently available liquidity of the HCI Group would not be suffi cient if called upon to a signifi cant extent, and illiquidity would result.

The HCI Group counters this risk by intensive negotiations with the lending banks, by analysing and valuing the potentially affected ship types and orders for new ships, and by devising an individual action plan for each ship affected. Potential measures include, above all, cancelling orders for new ships, delaying the scheduled delivery date, exchanging ships, renegotiating the purchase price of ships, partially deferring purchase price payments, devising new employment concepts, and adjusting profi t margins and sales concepts. If these measures prove ineffective, the HCI Group needs to obtain suitable funding from banks. The Group has accordingly initiated negotiations with banks in order to conclude agreements to secure liquidity.

(12) Events subsequent to the balance sheet date

No signifi cant events have occurred since the balance sheet date that will have a material effect on the course of the HCI Group's business.

Forward-looking statements

These documents include certain forward-looking statements and information regarding future developments; these are based on the views and convictions of the Management Board of HCI Capital AG, and on assumptions and information currently available to HCI Capital AG. Words such as 'expect', 'assess', 'assume', 'intend', 'plan', 'should', 'might', 'project', or similar concepts referring to the company are designed to identify such forward-looking statements, which are subject to a number of uncertainties.

Many factors could cause the actual results achieved by HCI Group to be materially different from the forecasts expressed in such forward-looking statements.

HCI Capital AG accepts no responsibility or liability to the general public for updating or correcting any forward-looking statements. All forward-looking statements are subject to differing risks and levels of uncertainty: as a result, the actual fi gures may deviate from projected values. Forward-looking statements refl ect the prevailing opinion at the time they were made.

Financial Calendar

12.05.2009 Report on the fi rst three months of 2009

HCI CAPITAL: MEHR WERT. 12.08.2009 Half-yearly fi nancial report 2009

onshäuser in Deutschland, das die Konzeption und Realisierung geschlossener Beteiligungsangebote in zahlreichen Produktklassen anbietet. Seit ihrer Grün-11.11.2009 Report on the fi rst nine months of 2009

HCI Capital AG Bleichenbrücke 10 D-20354 Hamburg Telefon +49 40 88 88 1-125 Telefax +49 40 88 88 1-109 [email protected] oder www.hci-capital.de

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