ATOSS Software AG — Interim / Quarterly Report 2014

May 13, 2014

QUarterly report Q1/2014

LETTER TO SHAREHOLDERS

Andreas F. J. Obereder and Christof Leiber Board of Management ATOSS Software AG

Dear Shareholders, Ladies and Gentlemen,

In the first quarter of 2014 we have achieved outstanding results. Both the development in our sales and the volume of orders booked prove that there is no reduction in the high level of interest in workforce management by ATOSS. Overall turnover increased by a marked 11 percent, while growth in software licenses amounted to an outstanding 21 percent.

This extremely positive development was further underscored by a significant increase in orders received of 112 percent relative to the year before. While we scored some particular successes in the retail sector, demand in other sectors too demonstrates that our specialty is an issue of great topical interest, and our products and solutions are meeting with a highly positive response.

Consequently, ATOSS has continued to expand its position as a specialist in workforce management with the ability to offer its customers a particularly high degree of investment security. Taken in aggregate, this is an ideal start to the new financial year, and one that fills us with considerable optimism.

We see this as confirmation of our assessment that workforce management is a central strategic instrument of corporate management.

It is no longer just a matter of managing working hours as best as possible in consideration of statutory requirements. Workforce management helps companies to master the manifold problems presented by a highly volatile global economic climate and enhance their potential to add value.

In past years we have delivered convincing performance based on continuity, quality of service and the consistent exploitation of growth opportunities. Of essential importance here is the sustained ability of ATOSS to innovate and align its solutions with individual sectors and specific processes. Only by doing so has it been possible to achieve a material advantage over our rivals. By investing in sectorspecific expertise and the ongoing development of our solutions, we have succeeded with sustained effect in distinguishing ourselves from the competition. According to a survey by the journal Wirtschaftswoche, ATOSS ranks among the Top 50 most innovative small businesses in Germany. The criteria by which we were judged included not just sales and profitability, but also new products and their market prospects, as well the company's innovation culture.

The ATOSS strategy has proved successful both nationally and internationally. Many German companies operate abroad, or are planning to do so. One of the reasons why we are represented in over 30 countries worldwide is because we accompany our customers in their development. The flexibility of our solutions is a deciding factor, in that it enables us to replicate and accommodate the diverse working time patterns, qualifications and statutory requirements in different countries. As a result, our customers enjoy the potential for cross-border optimization.

In view of the company's outstanding strategic positioning, the current economic climate offers excellent growth prospects for ATOSS. The Management Board therefore expects the highly positive development in business to be sustained in the current financial year and beyond.

Yours sincerely,

Andreas F.J. Obereder Christof Leiber

Chief Executive Officer Member of the Board of Management

Facts Overview

Economic background

According to the German Institute for Economic Research, German GDP in the first quarter of 2014 is expected to riseby 0.7 percent relative to the previous quarter.

The market for software is likely to grow by 5 percent in 2014 to just under EUR 19 billion.

ATOSS Software AG

Overall sales up 11 percent, including 21 percent growth in software licenses, incoming orders more than doubled relative to last year

C ONS OLIDATED OVERV IEW AS PER IFRS: 3-MONTH COMPARISON IN KEUR

	01.01.2014 – 31.03.2014	Proportion of Total sales revenues	01.01.2013 – 31.03.2013*	Proportion of Total sales revenues	Change 2014 to 2013
Sales	9,653	100%	8,691	100%	11%
Software	5,910	61%	5,275	61%	12%
Software licenses	2,142	22%	1,769	20%	21%
Software maintenance	3,768	39%	3,506	41%	8%
Consulting	2,495	26%	2,158	25%	16%
Hardware	1,050	11%	893	10%	18%
Miscellaneous	198	2%	365	4%	-46%
EBITD A	2,662	28%	2,218	26%	20%
EBIT	2,527	26%	2,070	24%	22%
EBT	2,844	30%	2,404	28%	18%
Net earnings	1,968	20%	1,751	20%	12%
Cash flow	3,979	41%	2,493	29%	60%
Liquidity (1/2)	19,493		24,370		-20%
EPS (in EUR )	0.50		0.44		14%
Employees (3)	293		279		5%

CONSOLIDATED OVERVIEW AS PER IFRS: QUARTERLY COMPARISON IN KEUR

	Q1/14	Q4/13*	Q3/13*	Q2/13*	Q1/13*
Sales	9,653	9,025	8,949	8,840	8,691
Software	5,910	5,617	5,369	5,585	5,275
Software licenses	2,142	1,965	1,779	2,025	1,769
Software maintenance	3,768	3,652	3,590	3,560	3,506
Consulting	2,495	2,375	2,165	2,264	2,158
Hardware	1,050	768	1,126	569	893
Miscellaneous	198	264	289	422	365
EBITD A	2,662	2,094	2,373	2,322	2,218
EBIT	2,527	1,946	2,230	2,186	2,070
EBIT margin in %	26%	22%	25%	25%	24%
EBT	2,844	1,385	2,493	-1,962	2,404
Net earnings	1,968	835	1,724	-1,290	1,751
Cash flow	3,979	-186	5,658	297	2,493
Liquidity (1/2)	19,493	15,249	16,177	10,418	24,370
EPS (in EUR )	0.50	0.21	0.43	-0.32	0.44
Employees (3)	293	289	280	280	279

(1) Cash and cash equivalents, other current and non-current financial assets (sight deposits, gold)

as of the qualifying date, adjusted to exclude borrowings (loans) (2) Dividend of EUR 3.62 per share on 29.04.2013 (TEUR 14,395)

(3) at the end of the quarter

INVESTOR RELATIONS

Share price movement: Q1/2007 – Q1/2014

CONSOLIDATED OVERVIEW AS PER IFRS: QUARTERLY COMPARISON IN EUR

	Q1/14	Q4/13	Q3/13	Q2/13	Q1/13
Highest price	30.29	29.19	29.15	34.10	36.30
Lowest price	27.81	24.85	24.09	24.05	20.76
Share price at end of quarter	29.30	28.56	25.30	24.84	33.80
Dividend paid per share (2)	0.00	0.00	0.00	3.62	0.00
Cash flow per share	1.00	-0.05	1.42	0.07	0.63
Liquidity per share (1/2)	4.90	3.83	4.07	2.62	6.13
EPS	0.50	0.22	0.43	-0.33	0.44
EPS (diluted)	0.50	0.22	0.43	-0.33	0.44

(1): Cash and cash equivalents, other current and non-current financial assets (sight deposits, gold) as of the qualifying date, adjusted to exclude borrowings (loans);

(2): Dividend of EUR 3.62 per share on 29.04.2013 (KEUR 14,395)

ATOSS stock – business and investment success go hand in hand

The development in sales and earnings in the first quarter of 2014 underscores the sustained success of the ATOSS business model. This in turn paves the way for further potential for our stock. At the annual general meeting in Munich on April 30 – and based on the strong volume of fresh orders received - the Management Board was able to report a positive outlook. The shareholders endorsed the management's proposals and all resolutions were adopted by a large majority in support of the company's management. The dividend for financial year 2013 in the amount of EUR 0.72 per share was disbursed to shareholders on May 2, 2014. Based on the closing price of ATOSS shares at the end of 2013, the dividend yield stood at 2.5 percent.

In recent years ATOSS Software AG has significantly increased the value of its shareholders assets. The continuous positive development in the company's operations coupled with the dynamic growth opportunities inherent in a technology business have gone hand in hand with the company's own dividend policy. This combines substantial continuity in the level of shareholder participation in the company's success in the form of dividends with the opportunity for extraordinary distributions of surplus liquidity.

This combination of strong share price growth and cash distributions continues to appeal to investors with a medium- to long-term investment strategy. In the first quarter of 2014 the price of ATOSS stock peaked at EUR 30.29, exceeding the highs in the previous two quarters. Viewed in the long term from 2007 until May 2014, the share price has risen by 181 percent, whereas in the same period the relative benchmark for ATOSS, the DAXsubsector Performance Index, was up by 65 percent. ATOSS stock has clearly outpaced the market.

Analysts raise the upside target once again

Based on the consistent growth recorded by ATOSS Software AG which has intensified in the first quarter of 2014, on April 22, 2014 the analysts at Warburg Research further increased the upside target for the stock to EUR 31.00. This followed on the heels of an earlier update in February 2014 when the upside target was lifted from EUR 26.20 to EUR 29.00. The current upside target set by Warburg Research at EUR 31.00 represents a new record.

Further information: www.atoss.com

GROUP MANAGEMENT REPORT

1. Business and conditions: Upturn, but with risk

The global economy picked up pace once again in 2013. In addition to the continuing, if slow, revival in the eurozone, 2014 will also see an increase in economic momentum in the USA. In Germany, too, the economy is accelerating in line with this global upturn, with gross domestic product expected to rise by 1.75 percent in 2014 and as much as 2.0 percent in 2015. Supported by both consumer spending and investment, the upswing will be broad-based. However despite buoyant exports, the impact of increasing domestic demand will outweigh that of foreign trade.

Of course, given in particular the crisis in the Crimea and political conflicts in a series of important developing countries and their potential economic effects, these forecasts are coupled with many uncertainties. Another central assumption is that there will be no major imponderables or adaptive difficulties arising from Europe's sovereign debt crisis and its financial market and structural problems.

The fundamentally positive mood is shared by German businesses. In a survey by the Cologne Institute for Economic Research, more than 46 percent of the 3,000 companies surveyed rated their business situation as better than in autumn 2013 and a majority of 53 percent expected production to increase in 2014. Along with this positive outlook, the companies surveyed also expect to create a total of 640,000 new jobs in 2014 and 2015.

The high-tech sector, too, takes an optimistic view of the future, and in fact is more confident even than the business community as a whole. More than three quarters of high-tech companies in general expect rising sales in the first half of 2014, while among software providers the share stands at 87 percent. Industry association BITKOM in its forecast in March 2014 expects the software market to grow by 5.3 percent in the current year (previous year: 4.9 percent). The positive mood is also reflected in the BITKOM sector index which has advanced from 55 to 67 points.

Against this background, in the first three months ATOSS recorded strong business with sales up 11 percent and a 22 percent increase in operating profits (EBIT) – despite a sustained high level of investments in marketing and development. In its core software business the company achieved sales growth of 12 percent. In addition, a very gratifying development in orders received has also been recorded. At EUR 4.1 million as of March 31, 2014, the figure was substantially higher than last year's EUR 3.3 million.

2. Earnings position: New record sales and results

In the first three months of financial year 2014 ATOSS recorded sales revenues up 11 percent at EUR 9.7 million (previous year: EUR 8.7 million). In our core software business, sales climbed 12 percent from EUR 5.3 million to EUR 5.9 million, while sales of software licenses grew by 21 percent from EUR 1.8 million to EUR 2.1 million. Software maintenance, too, continued to develop positively with turnover increasing by 8 percent to EUR 3.8 million.

As of March 31, 2014 consulting sales stood at EUR 2.5 million (previous year: EUR 2.2 million).

Operating profits (EBIT), too, improved substantially relative to the year before, rising 22 percent from EUR 2.1 million to EUR 2.5 million.

Driven by positive financial earnings of EUR 0.3 million in connection with the increase in the gold price, earnings before taxes (EBT) in the reporting period climbed to EUR 2.8 million (previous year: EUR 2.4 million).

Earnings after tax at the end of March 2014 amounted to EUR 2.0 million (previous year: EUR 1.8 million). Earnings per share accordingly came in at EUR 0.50 (previous year: EUR 0.44).

Orders received as of March 31, 2014 amounted to EUR 2.8 million (previous year: EUR 1.3 million). Orders on hand for software licenses at the end of the first quarter amounted to EUR 4.1 million, well up on the previous year's figure of EUR 3.3 million, and an excellent starting point for the current 2014 financial year.

3. Net assets and financial position

In the first three months, cash flow from operations amounted to EUR 4.0 million (previous year: EUR 2.5 million). At the same time, liquidity (cash and cash equivalents less borrowings) increased relative to the same period last year from EUR 11.1 million to EUR 14.3 million. The position as a whole comprising liquidity and other current and non-current financial assets, after adjusting for borrowed funds such as loans, slipped from EUR 24.4 million to EUR 19.5 million, in view of the distribution of EUR 14.4 million at the end of April 2013. Liquidity per share on March 31, 2014 including these other current and non-current financial assets and after adjusting for borrowings accordingly stood at EUR 4.90 (previous year: EUR 6.13).

In addition to net earnings of EUR 2.0 million, the EUR 4.0 million in cash flow from operations was also boosted by an increase in deferred revenues of EUR 3.9 million. Cash flow was by contrast reduced primarily by a reduction in miscellaneous current liabilities in the amount of EUR 1.4 million and an increase in trade receivables and other current assets of EUR 0.5 million.

As of March 31, 2014 ATOSS reported an equity ratio of 50 percent (previous year: 68 percent). Consequently, the company remains extremely well capitalized, with solvency assured at all times.

4. Product development

A high level of expenditure on research & development remains an important component of the ATOSS growth strategy with the goal of further extending the company's strong position as a technological leader in workforce management. Research and development costs in the first three months rose by 6 percent relative to the year before to stand at EUR 1.9 million as of March 31, 2014 (previous year: EUR 1.8 million). R&D costs as a proportion of overall sales amounted to 20 percent (previous year: 21 percent).

The company continues to refrain from capitalizing the expense of developing new products. All expenditure for this purpose is recognized in the income statement in the period in which it is incurred.

5. Employees

The number of employees has risen from 279 last year to 293. On March 31, 2014, ATOSS had 127 staff employed in development (previous year: 121), 79 employed in consulting (previous year: 74), 43 in sales and marketing (previous year: 41) and 44 in administration (previous year: 43).

Personnel costs for the current financial year amounted as of March 31, 2014 to EUR 4.7 million (previous year: EUR 4.1 million).

6. Risks associated with future development

There has been no material change in the company's risk structure relative to the description contained in the consolidated financial statements to December 31, 2013.

The market risk associated with financial assets available for sale essential concerns the fair value of the company's gold holdings, which stood at EUR 5.2 million as of March 31, 2014 and is dependent on the ongoing development in the gold price.

7. Events after the closing dateg

There have been no reportable events of particular significance since March 31, 2014.

8. Outlook

In the first three months of the current financial year 2014 ATOSS has experienced extremely positive developments in sales and operating profits. In view of these developments and in consideration of the high level of orders on hand, despite further scheduled investments, particularly in developing new markets, and a continuing high level of expenditure on research & development amounting to around one fifth of sales, the Management Board continues to expect stable sales growth in the current financial year with an EBIT margin in excess of 20 percent.

CON SOLIDATED BALANCE SHEET to 31.03.2014

Assets (EUR )	31.03.2014	31.12.2013
Non-current assets
Intangible assets	151,719	145,046
Property, plant and equipment	2,682,426	2,725,868
Other financial assets	430,920	408,491
Deferred taxes	641,652	630,402
Total non-current assets	3,906,717	3,909,807
Current assets
Inventories	9,315	8,642
Trade accounts receivable	3,301,826	3,029,835
Other financial assets	4,780,982	4,448,182
Other non-financial assets	1,440,060	1,189,822
Cash and cash equivalents	14,281,404	10,392,796
Total current assets	23,813,587	19,069,277
Total assets	27,720,304	22,979,084
Equity and Liabilities (EUR )	31.03.2014	31.12.2013
Equity
Subscribed capital	3,976,568	3,976,568
Capital reserve	-661,338	-661,338
Equity deriving from unrealized profits/losses	-717,573	-734,394
Unappropriated net income	11,125,157	9,156,749
Total equity	13,722,814	11,737,585
Non-current liabilities
Pension provisions	2,695,163	2,687,192
Deferred taxes	218,529	354,275
Total non-current liabilities	2,913,692	3,041,467
Current liabilities
Trade accounts payable	419,967	327,290
Other liabilities	3,323,055	4,734,091
Deferred revenues	6,814,097	2,944,110
Tax provisions	445,926	105,541
Other provisions	80,753	89,000
Total current liabilities	11,083,798	8,200,032
Total equity and liabilities	27,720,304	22,979,084

CONSOLIDATED INCOME STATEMENT FROM 01.01. TO 31.03.2014

	Quarterly report		3-months report
EUR	01.01.2014 –31.03.2014	01.01.2013 –31.03.2013 adjusted*	01.01.2014 –31.03.2014	01.01.2013 –31.03.2013 adjusted*
Sales revenues	9,652,799	8,690,928	9,652,799	8,690,928
Cost of sales	-2,846,588	-2,462,282	-2,846,588	-2,462,282
Gross profit	6,806,211	6,228,646	6,806,211	6,228,646
Selling costs	-1,617,821	-1,451,818	-1,617,821	-1,451,818
Administration costs	-785,086	-844,288	-785,086	-844,288
Research and development costs	-1,943,800	-1,827,300	-1,943,800	-1,827,300
Other operating income	76,619	7,616	76,619	7,616
Other operating expenses	-8,838	-42,538	-8,838	-42,538
Operating profit (EBIT)	2,527,285	2,070,318	2,527,285	2,070,318
Interest and similar income	340,171	411,854	340,171	411,854
Interest and similar expenses	-23,117	-78,467	-23,117	-78,467
Earnings before taxes (EBT)	2,844,339	2,403,705	2,844,339	2,403,705
Taxes on income and earnings	-875,931	-653,199	-875,931	-653,199
Net income for the year	1,968,408	1,750,506	1,968,408	1,750,506
Earnings per share (undiluted)	0,50	0,44	0,50	0,44
Earnings per share (diluted)	0,50	0,44	0,50	0,44
Average number of shares in circulation (undiluted)	3,976,568	3,976,568	3,976,568	3,976,568
Average number of shares in circulation (diluted)	3,976,568	3,976,568	3,976,568	3,976,568

* adjusted for the effects of IAS 19 R

CO NSOLIDATED STATEMENT OF CO MPREHE NSIVE INCO	ME FROM 01.01 TO 31.03.14
EUR	01.01.2014 –31.03.2014	01.01.2013 –31.03.2013 adjusted*	01.01.2013 –31.03.2013
Net income for the year	1,968,408	1,750,506	1,733,273
Components not reallocated in profit and loss
Profits/losses on the revaluation of defined benefit pension plans recognized in equity		-87,203
Tax effects on profits/losses on the revolution of defined benefit pension plans recognized in equity		16,112
Components reallocated in profit or loss in later periods
Profits/losses recognized in equity on the disposal of financial assets available for sale	22,429	-357,416	-357,416
Tax effects on profits/losses recognized in equtiy on the disposal of financial assets available for sale	-5,608	54,406	54,406
Other comprehensive income for the period after taxes	16,821	-374,101	-303,010
Comprehensive income after taxes	1,985,229	1,376,405	1,430,263

CONSOLIDATED CASH FLOW STATEMENT FROM 01.01 TO 31.03.2014

EUR	01.01.2014 -31.03.2014	01.01.2013 -31.03.2013 adjusted*
Business operations
Net income	1,968,408	1,750,506
Depreciation of fixed assets	134,279	147,895
Gains from the disposal of fixed assets	0	0
Gains from the disposal / valuation of financial assets available for sale	-332,800	-340,085
Other financial investment income	-7,371	-15,392
Changes in deferred taxes	-146,998	-19,561
Change in provisions for pension commitments	7,972	2,162
Adjustment for items not recognized in profit or loss	-5,607	54,405
Change in net current assets
Trade accounts receivable	-271,992	-561,520
Inventories and other assets	-250,912	-560,438
Trade accounts payable	92,677	4,248
Other provisions	-8,247	0
Other liabilities	-1,411,035	-1,627,622
Deferred revenues	3,869,986	3,714,281
Tax provisions	340,385	-55,471
Cash flow generated from business operations (1)	3,978,745	2,493,408
Investment activities
Disbursements for the purchase of tangible and intangible assets	-97,508	-65,134
Receipts from the disposal of other financial assets	0	3,296,036
Interest/dividend receipts	7,371	30,362
Cash flow generated from investment activities (2)	-90,137	3,261,264
Financing activities
Loans disbursed	0	-3,500,000
Cash flow generated from financing activities (3)	0	-3,500,000
Changes in liquidity – total of (1) to (3)	3,888,608	2,254,672
Liquidity at the start of the period	10,392,796	8,859,080
Liquidity at the end of the period	14,281,404	11,113,752

EUR	Subscribed capital	Capital reserve	Treasury stock	Equity deriving from unrealized profits/losses	Profit shown on balance sheet	Total
Status 01.01.2013	3,976,568	-611,338	0	-148,944	20,522,139	23,688,425
Net income, adjusted*	0	0	0	0	1,750,506	1,750,506
Dividends	0	0	0	0	0	0
Other comprehensive income, adjusted*	0	0	0	-374,101	0	-374,101
Status 31.03.2013 adjusted*	3,976,568	-661,338	0	-523,045	22,272,645	25,064,830
Status 01.01.2014	3,976,568	-661,338	0	-734,394	9,156,749	11,737,585
Net income	0	0	0	0	1,968,408	1,968,408
Dividends	0	0	0	0	0	0
Other comprehensive icome	0	0	0	16,821	0	16,821
Status 31.03.2014	3,976,568	-661,338	0	-717,573	11,125,157	13,722,814

Consolidated Statement of Changes in EQUITY AS OF 31.03.2014

* adjusted for the effects of IAS 19 R

One share represents 1 euro of subscribed capital.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

1. General

The present quarterly report has been prepared in accordance with International Financial Reporting Standards (IFRS) in compliance with IAS 1.14. In particular the report complies with the provisions contained in IAS 34 "Interim Financial Reporting". The requirements contained in German Accounting Standard (DRS) No. 6 regarding interim reporting have likewise been fulfilled.

In accordance with IAS 34.20, the present statements include a consolidated balance sheet, consolidated income statement, consolidated statement of comprehensive income, consolidated cash flow statement, a consolidated statement of changes in consolidated equity and explanatory notes to the consolidated statements.

The same financial accounting, valuation and computation methods have been applied as in the case of the annual financial statements to December 31, 2013. The revised IAS 19, which requires unexpected fluctuations in pension benefit liabilities and assets - so-called actuarial gains and losses – to be recognized immediately in other comprehensive income, plan amendments to be recognized in profit and loss in full in the relevant period and expected interest on plan assets to be recognized at the discount interest rate only, was applied by the Group at the financial year end, backdated to January 1, 2013. Consequently the quarterly figures have been adjusted accordingly. In addition to the back-dated recognition in equity of actuarial gains and losses in the amount of TEUR 87, the corresponding deferred taxes carried as assets in the amount of TEUR 16 have been recognized in other comprehensive income. The recognition in the income statement firstly of an adjustment in returns on plan assets in line with the discount rate on the defined benefit liability and secondly of deferred taxes on the pension provision led to an increase in earnings of TEUR 17.

The Management Board is satisfied that the impression of the economic situation of the company, its net assets, financial position, earnings situation and cash flow conveyed by the present quarterly financial statements accords with the true facts. This interim report has not undergone an auditors' inspection or statutory audit.

2. Reporting period

The present interim report was prepared to March 31, 2014 for the reporting period from January 1, 2014 to that date.

3. Currency

All figures are stated in euro. Amounts are rounded up to whole euro units.

4. Consolidated group

In addition to the parent company ATOSS Software AG, Munich, the consolidated financial statements to March 31, 2014 also include all subsidiary companies:

ATOSS CSD Software GmbH, Cham, Germany ATOSS Software Ges.mbH, Vienna, Austria ATOSS Software AG, Zurich, Switzerland ATOSS Software S.R.L., Timisoara, Romania

These companies are fully consolidated.

5. Changes in equity

The development in equity is evident from the statement of changes in consolidated equity.

6. Sales revenues

The company's sales revenues in the financial year were composed as follows:

EUR	01.01.2014 –31.03.2014	01.01.2013 –31.03.2013
Software licenses	2,142,080	1,768,981
Software maintenance	3,767,672	3,505,570
Total software	5,909,752	5,274,551
Consulting	2,495,148	2,157,707
Hardware	1,049,963	893,406
Others	197,937	365,264
Total sales revenues	9,652,800	8,690,928

The geographic breakdown of sales revenues was as follows:

EUR	01.01.2014 –31.03.2014	01.01.2013 –31.03.2013
Germany	8,213,413	8,061,831
Austria	987,688	382,791
Switzerland	176,443	163,643
German-speaking territories in total	9,377,544	8,608,265
Other countries	275,256	82,663
Total sales revenues	9,652,800	8,690,928

7. Personnel expenses

The consolidated personnel costs to March 31, 2014 were composed as follows:

EUR	01.01.2014 –31.03.2014	01.01.2013 –31.03.2013
Wages and salaries	3,948,228	3,362,047
Social security contributions and expenditure on retirement pensions and welfare	775,998	721,507
Total personnel costs	4,724,226	4,083,554

8. Other operating income and expenses

In the first three months of the current financial year the company recorded other operating income in the amount of EUR 76,619 (previous year: EUR 7,616). This income essentially resulted from the liquidation of reserves and reimbursement of costs.

The other operating expenses amounting to EUR 8,838 (previous year: EUR 42,538) essentially concerned adjustments resulting from exchange rate differentials.

9. Financial investment income and expenses

The company recorded income in the first three months of the current financial year in the amount of EUR 340,171 (previous year: EUR 411,854) from financial investments. This essentially comprised income from write-ups on the company's gold holdings in the amount of EUR 332,800 and interest income of EUR 7,371 (previous year: EUR 15,391).

As of March 31, 2014 the company recorded financial expenses amounting to EUR 23,117 (previous year: EUR 78,467). This exclusively concerned interest expenses in connection with the pension provision.

10. Tax charge

Consolidated tax expenses to March 31, 2014 were comprised as follows:

EUR	01.01.2014 –31.03.2014	01.01.2013 –31.03.2013
Pre-tax earnings (EBT)	2,844,339	2,397,335
Expected tax charge (2014: 32.60%, 2013: 32.60%)	-927,255	-781,531
Non-deductible operating expenses	-3,205	-7,899
Interests as per § 8b KStG	0	105,437
Differences in tax rates at consolidated companies	54,529	19,931
Actual Group tax charge	-875,931	-664,062

11. Earnings per share

The figure for earnings per share is arrived at by dividing the net result for the period in the amount of EUR 1,968,408 by the weighted average number of shares outstanding. From January 1 to March 31, 2014 there were an average of 3,976,568 shares in circulation. Accordingly earnings per share for this period amounted to EUR 0.50, in comparison with EUR 0.44 in the first three months of the preceding year.

12. Segment reporting

The identification of operating segments presupposes that a senior decision-maker monitors and assesses the profitability of significant components of the company as the basis for resource allocation and profitability measurement, that the components of the company generate income and incur expenses as part of their business activities, and that financial information is available for these components of the company. Several segments can be aggregated into one segment if the type of products and services, production processes and customers for which the products and services are intended are similar, as well as the sales methods applied, and where they exhibit a significant shortfall relative to the quantitative thresholds for segment formation.

The company has only one uniform business segment within the meaning of IFRS 8 which comprises the creation, sale and implementation of software solutions directed towards the efficient deployment of personnel and workforce management.

The following tables depict sales revenues broken down by software solutions and their contributions to the operating result.

The individual software solutions comprise:

ATOSS Staff Efficiency Suite (ASES) and ATOSS Startup Edition (ASE):

ASES and ASE are time and attendance management and workforce scheduling solutions for customers of all sizes in all industries. These software solutions are generally accompanied by other services covering implementation and training. In addition consulting services are rendered with the object of making meaningful use of the available scope and developing optimum solutions for the efficient deployment of personnel and workforce management under specific operating conditions and in consideration of company agreements and industry-wide wage agreements. The company also sells hardware components for time recording and access control purposes. ASES/ASE software is used in conjunction with all major standard system platforms and databases. Moreover thanks to the extensive facility to define customerspecific parameters these solutions are capable of satisfying even the most sophisticated requirements of customers of all sizes in all industries.

ATOSS Time Control (ATC):

ATC offers a software solution for time and attendance management and workforce scheduling for small and medium-sized customers, as well as large but decentrally organized clients. Likewise in conjunction with ATC, ATOSS offers software implementation and training as well as consulting services. Merchandise including hardware and recording media is also available. ATC software is installed on the Microsoft Windows system platform in association with standard SQL databases and is particularly user-friendly and convenient for small to medium-sized customers as well as large decentralized organizations.

EUR	01.01.2014 –31.03.2014	01.01.2013 –31.03.2013
Sales revenues
ATO SS Staff Efficiency Suite (ASES) and ATO SS Startup Edition (ASE)	8,806,620	7,962,605
ATO SS Time Control (ATC)	846,179	728,323
Total sales revenues	9,652,799	8,690,928
Operating result (EBIT)
ATO SS Staff Efficiency Suite (ASES) and ATO SS Startup Edition (ASE)	2,329,438	1,966,120
ATO SS Time Control (ATC)	197,847	104,198
Operating result (EBIT) in total	2,527,285	2,070,318

13. Employees

On March 31, 2014 the company had 293 employees (previous year: 279).

EUR	01.01.2014 –31.03.2014	01.01.2013 –31.03.2013
Development	127	121
Consulting	79	74
Sales and marketing	43	41
Administration	44	43
Total	293	279

14. Management Board

The members of the Management Board are:

Andreas F. J. Obereder	Chief Executive Officer
Christof Leiber	Member of the Board of Management

15. Supervisory Board

By a resolution adopted at the annual general meeting on April 30, 2014, the Supervisory Board was re-elected and is now comprised as follows:

Peter Kirn	Chairman
Rolf Baron Vielhauer von Hohenhau	Deputy Chairman
Klaus Bauer	Member of the Supervisory Board

16. Board member shareholdings

As of March 31, 2014 the following board members held the following numbers of ATOSS shares:

EUR	31.03.2014	31.12.2013	30.09.2013	30.06.2013	31.03.2013
Andreas F. J. Obereder	1,988,285	1,988,285	1,988,285	1,988,285	1,988,285
Christof Leiber	14,760	14,760	14,760	14,760	14,760

The majority shareholder, Andreas F.J. Obereder of Grünwald, Germany, holds 1,988,285 shares representing 50.0000025 percent of the shares in ATOSS Software. His shares are held via the company AOB Invest GmbH of Grünwald, Germany, which is wholly owned by him.

17. Notifiable participating interests

In the first three months of financial year 2014 the company received no notifications regarding changes in participating interests pursuant to Sections 21 ff. of the German Securities Trading Act.

18. Business relations with closely related persons

As of March 31, 2014, there were no business relations with closely related persons.

19. Events after the closing date

There have been no reportable events of particular significance since March 31, 2014.

Declaration by the Legal Representatives

According to the best of our knowledge, we assure that, pursuant to the applicable accounting principles for interim reporting, the interim consolidated financial statements convey a true and fair view of the Group's net assets, financial position and results of operations, and that the business development, including the business results and the Group's position, are presented in the interim Group management reports in such a way that they convey a true and fair view, and that the key opportunities and risks pertaining to the Group's prospective development in the remainder of the fiscal year are described.

Munich, May 12, 2014

Andreas F.J. Obereder Christof Leiber

Chief Executive Officer Member of the Board of Management

Disclaimer

This report contains forward-looking statements that are based on the conviction of the Management Board of ATOSS Software AG and reflect current assumptions and estimations. These forward-looking statements are subject to risks and uncertainties. Many facts that cannot currently be predicted may cause the actual performance and earnings of ATOSS Software AG to develop in a different manner. This could for example include the non-acceptance of newly introduced products or services, changes in the general economic and business climate, a failure to achieve efficiency and cost-reduction targets or changes in business strategy.

The Management Board is firmly convinced that the expectations embodied in these forward-looking statements are sound and realistic. Should however the above-mentioned or other unforeseeable risks materialize, ATOSS Software AG cannot guarantee that the expressed expectations will prove to be correct.

Corporate calendar

July 22, 2014	Press Release Six Months' Statement
August 12, 2014	Publication Six Months' Statement
October 21, 2014	Press Release Nine Months' Statement
November 14, 2014	Publication Nine Months' Statement
November 24 – 26, 2014	ATO SS at the German Equity Forum

Imprint

RESPONSIBle

ATOSS Software AG Am Moosfeld 3 D-81829 Munich

T +49 89 4 27 71 0 F +49 89 4 27 71 100 info@atoss.com www.atoss.com

INVESTOR RELATIONS

ATOSS Software AG Investor Relations Christof Leiber

T +49 89 4 27 71 0 F +49 89 4 27 71 100 Christof.Leiber@atoss.com

Representations

Düsseldorf Robert-Bosch-Straße 14 40668 Meerbusch T +49 21 50 9 65 0

Frankfurt Campus Carré Herriotstraße 8 60528 Frankfurt/Main T +49 69 13 82 43 0

Hamburg Osterbekstraße 90b 22083 Hamburg T +49 40 27 81 63 0

Stuttgart Zettachring 10a 70567 Stuttgart T +49 7 11 7 28 73 200

Utrecht (Netherlands) ATOSS Software AG Newtonlaan 115 3584 BH Utrecht T +31 30 210 6028

Affiliated Companies

Germany ATOSS CSD Software GmbH Rodinger Straße 19 93413 Cham T +49 99 71 85 18 0

Austria ATOSS Software Ges. mbH Europaplatz 2/1/2 1150 Vienna T +43 1 7 17 28 334

Switzerland ATOSS Software AG Leutschenbachstraße 95 8050 Zurich T +41 44 3 08 39 56

Romania SC ATOSS Software SRL Str. Diaconu Coresi, Nr. 31 300588 Timisoara T +40 356 71 01 82

atoss.com