Bauer AG — Interim / Quarterly Report 2013

May 15, 2013

Interim Report to March 31, 2013

GROUP KEY FIGURES, JANUARY – MARCH 2013

IFRS in EUR million	03/2012 *	03/2013	Change	12/2012 *
Total Group revenues	340.0	331.2	-2.6 %	1,445.6
of which Germany	82.2	96.3	17.2 %	385.3
International	257.8	234.9	-8.9 %	1,060.3
International in %	75.8	70.9	n/a	73.3
of which Construction	156.9	153.6	-2.1 %	656.8
Equipment	140.7	152.6	8.5 %	596.1
Resources	58.1	39.2	-32.6 %	263.9
Other/Consolidation	-15.7	-14.2	n/a	-71.2
Consolidated revenues	328.4	310.1	-5.6 %	1,385.9
Sales revenues	286.2	262.6	-8.3 %	1,344.4
Orders received	341.6	349.6	2.3 %	1,480.6
Orders in hand	751.6	803.4	6.9 %	785.0
EBITDA	28.4	23.1	-18.6 %	163.8
EBITDA margin in % (of sales revenues)	9.9	8.8	n/a	12.2
EBIT	6.4	2.3	n/a	72.0
EBIT margin in % (of sales revenues)	2.3	0.9	n/a	5.4
Net profit or loss	-4.7	-9.6	n/a	25.8
Capital investment in property, plant and equipment	21.3	18.5	-13.3 %	96.4
Shareholders' equity	447.9	457.4	2.1 %	462.8
Equity ratio in %	28.5	28.4	n/a	30.3
Net assets	1,570.1	1,610.0	2.5 %	1,529.4
Earnings per share	-0.26	-0.54	n/a	1.44
Return on equity after tax in %	n/a	n/a	n/a	5.6
Employees (on average over the year)	10,032	10,176	1.4 %	10,253
of which Germany	4,075	4,100	0.6 %	4,090
International	5,957	6,076	2.0 %	6,163

* See footnote on page 18

At variance with the consolidated revenues presented in the Group income statement, the total Group revenues presented here include portions of revenues from associated companies as well as revenues of non-consolidated subsidiaries and joint ventures.

Percentages are calculated on the basis of unrounded starting values (EUR thousand).

Summary

Total revenues of the BAUER Group for first quarter 2013 were slightly down against plan at EUR 331.2 million, 2.6 percent below the previous year comparative (EUR 340.0 million). The Construction segment's revenues declined somewhat compared to the previous year because of delayed starts to some major projects. By contrast, revenues in the Equipment segment rose by a substantial 8.5 percent. The revenues of the Resources segment fell 32.6 percent against the previous year comparative. This was because large projects generated virtually no revenues at all in the first quarter. As per the end of March, a net loss for the period of EUR 9.6 million had been made, representing a deterioration relative to the previous year comparative EUR -4.7 million. The first-quarter loss is commonly seen within our Group, because in many regions weather conditions at the start of the year are a determining factor in terms of business performance. Moreover, the public-sector contracts on which we are particularly dependent tend to be less prevalent at the start of the year due to budget constraints. Despite the continuing weak performance in the Equipment segment, healthy trends in the Construction and Resources segments led to a substantial increase in orders in hand to EUR 803.4 million (previous year: EUR 751.6 million). We are confirming our full-year forecast published in the 2012 Annual Report predicting total Group revenues of more than EUR 1.5 billion and after-tax profit of above EUR 30 million.

Course of Business and Background Conditions

GENERAL ECONOMIC CLIMATE

Trends in the global economy continue to be highly inconsistent and fluctuating. We are now four years on from the initial high-point of the financial crisis. A wide range of measures prevented damaging effects from spreading globally, enabling some countries – including Germany – to return to economic growth. It has unfortunately not been possible to stabilize the situation everywhere. Some countries are faced with massive economic problems.

Even as the decisions were being taken to implement wide-ranging stabilization policies, it was clear that they would themselves trigger further negative effects. Nevertheless, the policy approach was correct and necessary. All that proved incorrect was the assumption that the overall economic situation would stabilize rapidly and lastingly once the positive effects began to be felt. In the aftermath of such major crises, economies undergo reactions and counter-reactions which impede the system as a whole over a period of many years. Stability is only restored after a relatively long time.

The consequences of the financial crisis have been exacerbated in recent years by a number of additional factors which have impacted on the global economy. Political unrest in the Middle East has brought many changes which have also had a very negative effect on the economy. The nuclear disaster in Fukushima altered many countries' attitudes with regard to future development in the energy sector. In Germany, especially, the decision to withdraw from nuclear power had a wideranging impact. Other recent political problems, such as the behaviour of North Korea in relation to the rest of the world and the increasing communication problems between Germany and Russia, are causing concerns which are also influencing economic trends.

All in all, trends in the global economy are showing positive signs once again, though varying widely by region and accompanied by a large number of lasting changes. The most dynamic growth is being seen in the Far East, as the countries in that region maintain their rapid development and continue to catch up with the established industrialized nations. Russia is profiting from its enormous natural resources. Another pleasing factor is that the USA is showing signs of returning to economic growth. By contrast, most countries in Europe are battling issues of sovereign debt and massive budget deficits. Even countries thought to be approaching the future without economic impairments – such as Brazil and Australia – are having to work hard to prevent their development from slowing.

One of the major global changes being seen is the shift in economic and political dominance, particularly in terms of the key role being assumed by China. This is also being demonstrated in relation to the financing of major western countries, including the USA, and in the increasing pre-dominance of Chinese companies in a wide range of sectors: in the raw material field, especially rare earths; in toys and clothing; in solar power and electronic components; and increasingly in the construction machinery industry too. The times when Chinese industry merely copied others are long gone. Young, well trained engineers are keen to do things better than their counterparts in the West. That poses a major challenge to all businesses – particularly in the construction machinery industry.

In view of these many and diverse economic changes, it is not advisable to focus too closely on superficially apparent current trends. The example of the solar industry demonstrates the erroneous belief that a predominant position can be achieved and maintained over a period of years in such a booming sector. Competitors from China have used their production advantages, particularly in terms of standard products, to now claim market dominance. The stakeholders in the offshore wind power sector, currently very much at the cutting edge of trends, must find a rational approach so as not to miss out on opportunities in the same way.

A key factor for the construction business is that there remains considerable backlogged demand all over the world. In Western Europe and North America, much too little has been invested in building projects over a period of many years. Part of the reason for this was the widespread belief that everything needed for the future had already been built. The backlog of investment in infrastructure – such as roads, railways, water-ways, power stations, or renewal of housing stocks – is massive. Despite public-sector budget constraints, the construction sector is likely to see healthy growth over the coming years, as the aforementioned work cannot be postponed any longer. And the world's emerging markets – formerly designated as "developing countries", but now with growth rates belying that term – still have major infrastructure deficits which need to be cleared. They will provide healthy revenues for the construction business for many years to come.

What cannot be expected to last any longer, however, is the enormous growth in construction activity seen in recent years in some countries such as China and India. Construction capacities in those countries are almost fully developed. Their demand will remain high, but the kind of double-digit annual growth rates seen previously will be very rare. This is of major significance to construction machinery manufacturers especially, as they will not be able to bank on increasing capacity in future, but will be much more reliant on serving replacement demand. In view of the considerable capacities built up in some countries, especially China, in order to feed the domestic construction machinery boom, the years ahead will be marked more by overcapacity.

Uncertainty among the public at large regarding global change is problematic in terms of future development. Left-wing ideas are becoming increasingly popular, and the principles of the free market economy are being questioned. Debate on policy issues such as a wealth tax and increasing inheritance tax is becoming more widespread. The consequences have already been seen in elections in a number of European countries. This year there is a big election in Germany too, and a number of parties are promoting left-wing campaign agendas. The negative effects on economic development of such policies are given little consideration in political debates.

Germany's economy has grown pleasingly over the last two years. The automotive industry has been a particularly strong driver of growth, based primarily on car makers' strong strategic focus on premium models. Although it is to be hoped that the trend will be sustained, there are a number of signs indicating that this might not be the case. In view of the still very fragile situation, we in Germany have absolutely no reason to abandon our focus on optimizing costs. It is very much better for all concerned to exercise restraint in terms of labour costs than to return rapidly to the hardships of high unemployment.

The BAUER Group regards itself as being in a strong position, despite the current tough market conditions. The global structure of our business enables us to pursue the opportunities opened up by varying market trends. We have established a degree of flexibility in our business which allows us to rapidly transfer capacities between regions, pulling out of declining markets in order to exploit more profitable growing ones elsewhere.

There are large numbers of major construction projects all around the world for which our expertise is in demand. We are currently working on a large-scale dam remediation project in the USA, as well as on foundation works for Europe's tallest building in St. Petersburg, Russia, and what will be the world's tallest building in Jeddah, Saudi Arabia. Another major infrastructure project being built in large part on our foundation piles is the long-distance bridge between Hong Kong and Macau. Further interesting prospects in the pipeline include work on new dams for hydro-electric power stations.

Our Resources segment likewise has lots of work. With our environmental services, especially, we are able to bid for some major projects on the Arabian Peninsula which will provide us with lots of employment over the years ahead.

We also regard our Equipment segment as being on a positive course, despite the decline seen last year due to adverse market conditions. Our specialist machinery provides us with a sound market base, and means our vulnerability to the growing competition is limited. Our new products for drilling underwater or for deep drilling in the oil, gas and geothermal energy sectors, as well as for emergency mine recovery, will enable us to serve some interesting markets in the years ahead. At Bauma, the world's largest construction machinery trade fair held in Munich in mid-April, we saw very lively interest from customers.

OVERVIEW OF INTERNATIONAL MARKETS

Germany

The German construction market will see relatively positive growth over the coming years. Demand for construction works resulting from the reversal of energy policy will further boost this forecast trend.

Europe

Markets in Eastern Europe largely collapsed as a result of the economic crisis. There have recently been signs of a slight upturn, though at a very low level. There are large numbers of new construction projects currently in planning in Russia especially, as the country utilizes its enormous raw material wealth to drive recovery more rapidly than in other countries in the region. The construction market in some regions, such as around St. Petersburg, is very active. The forecast for Eastern Europe overall is a generally positive trend.

We predict that growth on construction markets in Western Europe will be modest over the coming years. Many countries have had to impose strict budget constraints which will hamper the further development of their infrastructure. There are nevertheless a number of opportunities for us around the region, including in Switzerland. In the UK, we are working on major projects for the London Underground which will keep us busy over the period ahead.

Middle East & Central Asia

The oil-rich and gas-rich countries of the Middle East, such as Abu Dhabi, Saudi Arabia and Qatar, have lots of large-scale construction projects in the pipeline, and have sufficient financial resources to sustain their development plans strongly. For our Construction segment this means that sales will be lower overall relative to the boom years, though they will generally attain a promising level for the future. The past year in the region was again overshadowed by major uncertainty relating to the situation in Egypt, Libya and Syria. Business performance was very muted as a result. We expect to return to healthy sales growth in 2013 and 2014, as pressure is intensifying to start major construction projects such as those for the football World Cup in Qatar.

Asia-Pacific, Far East & Australia

Construction markets in the Far East remain pleasingly stable. Almost every country in the region is undertaking major infrastructure projects. In Hong Kong, construction sector capacities are being well utilized by extensive rail and road construction works. The same is true in Singapore and Malaysia. Economies such as Indonesia and the Philippines are also seeing healthy growth.

America

The situation now appears to be improving after a number of weak years. It is in the USA that there is the highest level of backlogged demand in many infrastructure areas, arising from a lack of adequate investment over recent decades. Major efforts will be made over the coming years to make good this deficit, and a positive side effect of this commitment will be a further boost to the economy. Overall, we regard the situation as stable, and offering good opportunities for further growth in both our Construction and Equipment segments. Trends on the construction market in Canada are likewise sound. Project opportunities in Central America have been burgeoning for some time, so healthy sales are possible from the region.

Africa

In Africa, it will be worthwhile actively pursuing new business, even though the economic weakness of the countries concerned means the business generated will not make a major contribution to our total Group revenues overall.

In our global construction business, as well as in our Resources segment, alongside the regional changes already cited there are also some particularly strong opportunities arising from large-scale specialist projects. They include very large environmental remediation projects on the Arabian Peninsula. One of the largest projects up for tender is the remediation of a dam in Iraq requiring extensive specialist foundation engineering works to a value in the billion euro range. No actual contract has yet been finally signed, as other government priorities in the region are significantly slowing the progress of negotiations. The passing of time will reduce our chances of acquiring the contract slightly.

In general terms, our Equipment segment has similar opportunities to those of the Construction segment, as demand for construction machinery is very heavily dependent on construction markets.

In the Resources segment, alongside large-scale projects we see Africa, in particular, as offering strong opportunities for growth over the years ahead, as issues of water and raw material extraction play an increasingly important role.

PERFORMANCE OF THE BAUER GROUP

In first-quarter of 2013, the total revenues of the BAUER Group decreased slightly against the same period last year, falling 2.6 percent to EUR 331.2 million. The Group's net loss for the period of EUR 9.6 million represented a EUR 4.9 million decline against the previous year comparative (EUR -4.7 million).

The fall in earnings was spread across all three segments. The decline in the Construction segment resulted from the sluggish start to a number of major projects; in the Equipment segment earnings were depressed by higher tax expenditure; and reduced revenues in the Resources segment led to lower fixed cost coverage. Our businesses normally make a loss in the early part of the year, which is balanced out as the year progresses, with a return to profitability after the Summer months. Consequently, the first quarter provides no direct indication as to full-year performance.

Group orders in hand continued to make healthy progress, despite the complexity of global markets, increasing by 6.9 percent against the same period last year to EUR 803.4 million. Towards the end of last year we acquired a number of major projects which will substantially boost our growth this year. Orders in hand in the Construction segment are on the level of the boom year 2008. Major drivers of growth were the Kingdom Tower project in Jeddah, Saudi Arabia (worth around EUR 25 million) and the section of the foundations for the Hong Kong-Zhuhai-Macau bridge (approximately EUR 65 million). We have been contracted to execute the foundations for the Lakhta Tower in St. Petersburg, which will be the tallest building in Europe. Other interesting projects were acquired all over the world.

In the Resources segment, the construction phase of the major contract in Oman is complete. We are about to acquire some very interesting new contracts, however, so we continue to take a positive view as to future trends.

Orders in hand in the Equipment segment remain at a low level. Positive trends are being seen, however, in the current strong growth in our service business and in spare parts sales. The machines sold during the boom period are now reaching an age, after a number of years in operation, when they need major servicing and maintenance. The global increase in use of the machines is generating higher demand for wearing parts. The world's largest construction machinery trade fair Bauma, held in Munich in April, was a great success for us. Many thousands of visitors came to view the new equipment on our stand. We were greatly pleased by the level of interest shown.

All in all, the order situation and opportunities on the market provide a sound foundation for us to achieve our full-year forecast targets.

	in EUR million	March 2012 revenues *	March 2013 revenues	Share 2013	Change against previous year	Orders in hand
	BAUER Spezialtiefbau GmbH (BST)
	BST, Germany	19.9	23.2	7.0 %	16.6 %	+
	Subsidiaries, Germany	0.9	11.6	3.5 %	n/a	-
	BST, international	20.0	15.0	4.5 %	-25.0 %	+
	Subsidiaries, international	120.6	110.0	33.2 %	-8.8 %	+
	BST Group total	161.4	159.8	48.2 %	-1.0 %	+
Construction	SCHACHTBAU NORDHAUSEN GmbH incl. segment subsidiaries (SBN)	10.3	6.3	1.9 %	-38.8 %
	SPESA Spezialbau und Sanierung GmbH	2.4	3.5	1.1 %	45.8 %
	less intra-Group revenues and IFRS adjustments	-17.2	-16.0	-4.8 %
	Construction total	156.9	153.6	46.4 %	-2.1 %	+
	BAUER Maschinen GmbH (BMA)	87.7	87.8	26.5 %	0.1 %	–
	Equipment subsidiaries	87.8	86.9	26.2 %	-1.0 %
	BMA Group total	175.5	174.7	52.7 %	-0.5 %	–
Equipment	SBN	13.9	13.5	4.1 %	-2.9 %	–
	less intra-Group revenues and IFRS adjustments	-48.7	-35.6	-10.7 %
	Equipment total	140.7	152.6	46.1 %	8.5 %	–
	BAUER Resources GmbH (BRE)	1.3	1.3	0.4 %	0.0 %
	Resources subsidiaries	60.8	38.1	11.5 %	-37.3 %
	BRE Group total	62.1	39.4	11.9 %	-36.6 %
Resources	SBN	4.6	6.0	1.8 %	30.4 %	++
	less intra-Group revenues and IFRS adjustments	-8.6	-6.2	-1.9 %
	Resources total	58.1	39.2	11.8 %	-32.6 %	+
	BAUER Aktiengesellschaft (BAG)	7.1	7.5	2.2 %	5.6 %
	Other subsidiaries	0.6	0.6	0.2 %	0.0 %
Other	less intra-Group revenues and IFRS adjustments	0.0	0.0	0.0 %
	Total Other/services less intra-Group revenues and	7.7	8.1	2.4 %	5.2 %
	IFRS adjustments	-23.4	-22.3	-6.7 %
	Group total (including minority interests)	340.0	331.2	100.0 %	-2.6 %	+
	of which: Germany	82.2	96.3	29.1 %	17.2 %
	International	257.8	234.9	70.9 %	-8.9 %

BREAKDOWN OF TOTAL GROUP REVENUES BY SEGMENT

* See footnote on page 18

Notes on the table:

List also includes non-consolidated holdings

Valuation of orders in hand relative to budgeted sales:

-- weak; - slightly weak; adequate; + well adequate; ++ very well adequate;

Percentages and totals are calculated on the basis of unrounded starting values

Breakdown Germany/international according to country in which accounting figures were allocated. For reasons of complexity the figures are not absolutely precise.

Trends in our Business Segments

CONSTRUCTION SEGMENT

CONSTRUCTION SEGMENT KEY FIGURES

in EUR '000	03/2012 *	03/2013	Change	12/2012 *
Total Group revenues	156,870	153,609	-2.1 %	656,834
Sales revenues	138,839	124,351	-10.4 %	579,069
Orders received	163,042	153,121	-6.1 %	704,607
Orders in hand	463,000	512,599	10.7 %	513,087
EBIT	2,277	325	n/a	22,025
Net profit or loss	-2,330	-4,448	n/a	8,586
Employees (on average over the year)	5,301	5,334	0.6 %	5,454

* See footnote on page 18

The total Group revenues of the Construction segment amounting to EUR 153.6 million were 2.1 percent down against the previous year. The slight reduction resulted from sluggish starts to the large-scale projects in Saudi Arabia, Hong Kong and St. Petersburg. The reasons were problems which frequently occur in the early stages of contracts of such scale, including delays in obtaining approvals. Segment EBIT (earnings before interest and taxes) fell against the previous year comparative period from EUR 2.3 million to EUR 0.3 million. The net loss for the period deteriorated from EUR -2.3 million in the previous year to EUR -4.4 million. The loss was also linked to bad weather in a number of our markets.

The trend in orders in hand in our Construction segment was pleasing. At EUR 512.6 million, they are 10.7 percent above the corresponding period last year. We have plenty of projects in the pipeline in all our key markets, providing us with a sound basis to achieve our planned revenues. In addition to the aforementioned major projects internationally, we have also succeeded in acquiring a number of large contracts within Germany. As a result, our domestic prospects for the future are likewise positive.

The other German construction companies in the Group have stable order levels. SCHACHTBAU NORDHAUSEN GmbH is seeing an increase in capacity utilization in the mining sector.

An appraisal of ongoing market trends in the construction sector was presented in the "Overview of international markets" section above.

Full-year outlook

All in all, we expect our Construction segment to achieve healthy growth against the previous year in both revenues and earnings in 2013.

EQUIPMENT SEGMENT

EQUIPMENT SEGMENT KEY FIGURES

in EUR '000	03/2012 *	03/2013	Change	12/2012 *
Total Group revenues	140,659	152,624	8.5 %	596,086
Sales revenues	93,607	104,139	11.3 %	520,576
Orders received	149,578	165,732	10.8 %	592,959
Orders in hand	133,616	126,192	-5.6 %	113,084
EBIT	4,984	3,773	n/a	33,976
Net profit or loss	-274	-2,473	n/a	8,896
Employees (on average over the year)	2,962	2,971	0.3 %	2,952

* See footnote on page 18

The total Group revenues of the Equipment segment in the first three months of the year rose by 8.5 percent against the previous year comparative to EUR 152.6 million. Sales revenues increased by 11.3 percent. Segment EBIT fell slightly from EUR 5.0 million in the previous year to EUR 3.8 million. The net loss for the period deteriorated from EUR -0.3 million in the previous year to EUR -2.5 million. The decline in earnings largely resulted from a taxation effect linked to the very widely varying earnings performance in the countries where sales were made. Orders in hand in the Equipment segment totalling EUR 126.2 million remained at a low level. No substantial increase has been achieved since the recovery seen in 2010. Business continues to be very short-term in nature. Specialist foundation engineering machinery customers expect immediate delivery after ordering.

Markets

A number of machinery markets were very unsatisfactory in the past year. Ongoing unrest in Arab countries hampered investment; bureaucratic obstacles weakened the construction market in India, depressing the machinery business as a result; and in China the change of government resulted in very weak construction machinery markets. Other regions around the world were unable to balance out these effects, despite healthy performance in some instances. Moreover, competition from China in the standard equipment business intensified.

We are seeing many of the factors impacting on markets last year now being eliminated, so performance should recover. Nevertheless, the prevailing instability in turn means that the possibility of declines in other regions around the world cannot be ruled out. We are seeing a general improvement in construction machinery markets overall however. Based on our new products for deep drilling and other specialist foundation engineering techniques, we believe we are well equipped to balance out market fluctuations and achieve overall growth. The many positive conversations with customers at the Bauma fair also back our generally positive assessment.

Capacities at our production locations, which we expanded significantly during the boom period, are currently not yet being fully utilized. Looking back, however, we are very pleased that we took the decision to increase our capacities in recent years. It is only this foundation which will enable us to achieve our growth targets over the coming years based on new products.

Full-year outlook

We expect full-year sales in our machinery business to grow strongly against the previous year once again. This will have a positive influence on earnings, as fixed costs remain at constant levels.

RESOURCES SEGMENT

RESOURCES SEGMENT KEY FIGURES

in EUR '000	03/2012 *	03/2013	Change	12/2012 *
Total Group revenues	58,099	39,158	-32.6 %	263,916
Sales revenues	53,637	33,963	-36.7 %	244,273
Orders received	44,654	44,917	0.6 %	254,300
Orders in hand	154,998	164,586	6.2%	158,827
EBIT	-624	-2,383	n/a	15,196
Net profit or loss	-2,497	-3,558	n/a	5,664
Employees (on average over the year)	1,501	1,591	6.0 %	1,578

* See footnote on page 18

Our Resources segment saw its total Group revenues fall by a substantial 32.6 percent in first-quarter 2013 to EUR 39.2 million. Segment EBIT of EUR -2.4 million was likewise well down against the previous year comparative (EUR -0.6 million). The main reason for this was the early completion of the construction phase on our large-scale project in Oman in the past year. No further major contracts had yet been signed up, so a gap occurred. The year began sluggishly in some other areas of the segment's business too. Sales of well engineering materials, in particular, fell substantially short of planning owing to the bad weather in Germany. The net loss for the period deteriorated from EUR 2.5 million to EUR 3.6 million.

The Resources segment is currently underperforming its general trend. The completion of the construction phase on the major project in Oman – the driver of the significant increase in revenues last year – has created a gap in orders which will continue to impact generally on business through 2013. We nevertheless regard the segment as being on a very healthy track. A number of large-scale projects are currently at a very promising stage of negotiation, and the works in Oman especially will continue to generate healthy levels of revenues and earnings in future. There are also many positive signs being seen in the smaller businesses within the segment, leading us to expect healthy further growth in revenues. The fluctuation in the first quarter is normal in a business featuring large-scale single projects, and will be reduced through the course of the year.

The segment has healthy levels of orders in hand totalling EUR 164.6 million, though that figure is somewhat down against the peaks seen in the past. The Mining division of SCHACHTBAU NORDHAUSEN GmbH accounts for an outstanding EUR 47.7 million of the total. Negotiations are currently being conducted in respect of other potential large-scale projects in Oman and other Arab countries. Consequently, we expect that orders in hand will soon be in a position to increase significantly again. We are also making good progress on African markets. We also expect revenues to rise again based on the new contracts.

Full-year outlook

We see further healthy opportunities for growth over the coming years in the Resources segment. We predict that total Group revenues will be slightly lower than last year owing to the gap stemming from the large-scale projects. Earnings will likewise be down against the previous year.

Earnings, Financial and Net Asset Position

Our consolidated balance sheet and income statement continue to bear the marks of the years following the financial crisis, which entailed the need for significantly higher funding of our business. Up-front financing of our works additionally rose substantially in relation to a number of major construction projects. That change will continue to impact on us through 2013. Our Equipment segment, too, is still clearly showing the impact of its much increased up-front financing requirements, resulting from the need to hold more stocks due to shortened delivery lead times. The key changes brought about by the shift in markets over recent years are reflected as follows:

• Our business is becoming ever more asset-intensive. The projects being executed by our construction companies worldwide are becoming larger and more complex. This also requires larger and more expensive machinery. Conse quently, old equipment has to be replaced by higher-grade machinery, and so our fixed assets rise relative to business vol umes. This trend is in fact positive in terms of income, as the competition for complex projects tends to be less.
• Our inventories of finished goods and work in progress are much higher than before the crisis, and they will remain largely at that level. We have thus returned to a situation as it was prior to the boom period. During the boom, our cus tomers needed their equipment delivered as soon as possible. So machines could not be held for any length of time either in production or in stock. They were more or less "grabbed" as soon as they rolled off the assembly line. Today the situation has normalized again, resulting in higher inventory levels. The major volatility on individual markets is re peatedly generating unavoidable peaks in inventory levels. We are making major efforts to find solutions which will reduce these fluctuations.
• In the construction sector, the somewhat weaker market conditions mean that customers can extend payment terms. Payment practices have also deteriorated. This leads to higher costs for up-front financing of ongoing site operations.

Moreover, it is normal in the specialist foundation engineering and related equipment business that the financing needs of the companies concerned increase substantially in the early months and do not decrease again until towards the end of the year. This effect is attributable firstly to the payment practices of our customers, but also stems from the seasonal nature of the business and the necessity to boost production at the start of the year in order to make deliveries in the summer when sales rise. This results in a significant in-year rise in working capital. The same factors will have an opposite effect at the year-end.

On the balance sheet, material changes have occurred in relation to provisions for defined benefit plans, shareholders' equity and deferred taxes resulting from the first-time adoption of IAS 19 R. The change also entailed an adjustment of the previous year's figures.

Provisions for defined benefit plans were increased by EUR 28.2 million on the 2012 year-end balance sheet, and consequently also in the first-quarter 2013 report. As per December 31, 2012 this resulted in an increase in provisions for defined benefit plans from EUR 51.9 million to EUR 80.1 million. The change is linked to the currently low market interest rates, which arithmetically result in a higher provision. The difference did not have to be recognized earlier due to a corridor provision.

Within the contra-item increasing the provisions for defined benefit plans, EUR +7.9 million related to deferred tax assets, EUR -20.1 million to the shareholders' equity in BAUER AG, and EUR -0.2 million to shareholders' equity attributable to minority interests. The equity ratio at the 2012 year-end decreased as a result of this matter from 31.8 percent to 30.3 percent. Net assets rose by EUR 7.9 million. The company will experience a long-term effect from this change to the balance sheet. Our aim is to return to a 33 percent equity ratio soon. All other disclosures relate to the adjusted balances.

Net assets increased by 5.3 percent in the first three months of 2013 relative to the 2012 year-end. Against the balance sheet to March of last year, the increase was 2.5 percent.

EARNINGS

The consolidated revenues shown in the Group's earnings statement decreased by 5.6 percent against the previous year comparative period to EUR 310.1 million. The "Changes in inventories" item increased slightly to EUR 36.0 million. The "Other capitalized goods and services for own account" item, which mainly relates to the equipment required for our own in-house construction operations, amounted to just EUR 2.0 million in the first three months of the year. Sales revenues in themselves totalled EUR 262.6 million, 8.3 percent down against the previous year.

The cost of materials, staff costs, depreciation and amortization and other operating expenses items in the income statement rose somewhat more than the revenues overall, thereby also contributing to the slightly higher loss in the first quarter.

Depreciation of fixed assets remained virtually constant. Write-downs of inventories due to use decreased by EUR 1.4 million, because fewer machines were hired out. Other operating expenses fell slightly more than the rate of decrease in revenues, by 8.2 percent.

Financial expenses increased by 2.7 percent over the previous year.

Income tax expense, incurred despite the pre-tax loss, reflects the fact that losses made by subsidiaries were countered by profits made by other subsidiaries. The taxation effects cannot be offset. The tax expense will normalize again by the year-end. We expect that the full-year income tax rate will ultimately be similar to that of last year, at 30 percent.

In consequence, the net loss for the period deteriorated against the previous year from EUR -4.7 million to EUR -9.6 million.

FINANCIAL POSITION

Our financial position is developing in line with our expectations and plans. In view of the planned growth, we expect to see a slight increase in working capital and net debt over the full year. The ratio to revenues is expected to improve. The Group's 2013 financing requirement has already been covered by the long-term refinancing measures undertaken last year.

Our promissory notes, and some of the long-term loans taken out previously, are subject to credit clauses linked to predetermined financial variables (covenants). These are a ratio of net debt to EBITDA below 4 and 4.75 respectively, of EBITDA to net interest coverage above 2.8, and an equity ratio above 25 percent. The ratios are analyzed solely on the basis of end-of-year figures. We expect to maintain these ratios.

NET ASSET POSITION

The net assets shown on the balance sheet increased by 5.3 percent against the 2012 year-end figure. An in-year increase is normal in our business, for the reasons already outlined. The increase in net assets at the year-end should be slightly less than the rate of rise in revenues.

Fixed assets have increased slightly relative to the 2012 year-end. Non-current assets have risen by 0.7 percent overall. The inventories (particularly the "Finished goods and work in progress and merchandise" item) and the receivables reflect the annual recurring seasonal effect. The level of up-front financing for our projects and inventories has therefore risen accordingly. Cash and cash equivalents rose by EUR 8.5 million against the year-end figure.

On the Equity and Liabilities side, shareholders' equity decreased by EUR 5.4 million. The usual seasonal additional financing requirement was mainly covered by borrowings. Non-current financial liabilities decreased by EUR 8.4 million against the year-end, while current financial liabilities rose by EUR 130.2 million. Borrowings rose slightly relative to March 31, 2012, increasing by EUR 22.1 million.

DEVELOPMENT OF THE BAUER AG SHARE

At the beginning of the year, the share price rose from its 2013 opening EUR 19.79 to reach EUR 22.41 by mid-January. In further trading the share price moved little, though it did outperform the DAX and SDAX indices. On February 13th, the share price reached its high for the year to date of EUR 23.05. By the end of the month it had fallen back again to just under EUR 21, before then recovering again. From early March, the share price fell somewhat more heavily than the general stock market trend, and at the end of March was quoted at EUR 19.92. During April the share price fluctuated, but by the end of the month had improved to EUR 21.75.

HUMAN RESOURCES

The number of employees has not changed substantially from the levels at the year-end. The large-scale international projects repeatedly result in significant fluctuations between the individual Group segments. The trend in employee numbers is within the scope of our planning. Overall, on average over the year, we currently employ 10,176 people worldwide.

FOLLOW-UP REPORT

No matters of special note which we would expect to have a material influence on the net asset, financial and earnings position of the BAUER Group occurred after March 31, 2013.

OPPORTUNITIES AND RISKS

Major opportunities and risks are set out in the individual sections of this Interim Report. There has been no material change in risks since the Annual Report to December 31, 2012. Consequently, we refer back to the Group Management Report for financial 2012.

FULL-YEAR OUTLOOK

The first quarter has not yet provided any clear indication as to the achievement of our planned growth in 2013, and rather posed something of a burden in terms of attaining our goals. The trend is in no way disappointing as yet however. On the one hand, a business such as ours is characterized by large-scale projects, and on the other hand by a steady stream of ongoing developments. Early 2013 has been rather weak in both respects. The bad weather in Germany impeded stability in business operations such as sales of well engineering materials, and also prevented some of our smaller businesses from starting profitably. Approvals procedures and coordination of planning measures led to delays in starting construction work on major projects. The Resources segment is awaiting final decisions on new contract awards, so has been unable to maintain the same level of performance as in the previous year.

We are nevertheless optimistic that we will achieve our goals for 2013. Large-scale projects have been contracted, and the opportunities to acquire new business are very bright. In the machinery business, many markets around the world are beginning to see a recovery, and we enjoyed an excellent showing at Bauma, the world's largest construction machinery trade fair. We were the only company to be nominated for two innovation awards at the event. And our unique underwater drilling technique emerged as a winner of one of them.

Global markets remain highly fragile and volatile. That is impacting on all market players. In such a climate, our very broadbased regional structure and range of technical capabilities enable us to exploit many opportunities even in heavily fluctuating markets.

We are therefore confident that we will be able to realize our plans and fulfill our forecasts. They remain unchanged:

• Total Group revenues of more than EUR 1.5 billion.
• Profit after tax of above EUR 30 million, equating to EBIT of approximately EUR 85 million.

Despite the many disturbances being encountered worldwide, we continue to plan for growth in total Group revenues of between 5 and 10 percent over the coming years.

As in previous years, we must again advise that – contrary to earlier boom years – the forecast sales and earnings of the BAUER Group are subject to a much greater degree of uncertainty. The main reason for this is the persisting uncertainty regarding developments in many parts of the world.

All in all, we are looking to the future positively. We are also aware, however, that only a highly flexible approach will deliver the success we want. Our employees are also aware of that, and are prepared to meet the challenges of our time with great enthusiasm and commitment.

Interim Financial Statements of the BAUER Group

INCOME STATEMENT OF THE BAUER GROUP

in EUR '000		01.01. - 31.03.2012 * 01.01. - 31.03.2013
1. Sales revenues	286,217	262,596
2. Changes in inventories	31,953	35,960
3. Other capitalized goods and services for own account	1,077	2,018
4. Other income	9,162	9,526
CONSOLIDATED REVENUES	328,409	310,100
5. Cost of materials	-168,016	-157,776
6. Staff costs	-77,909	-79,542
7. Depreciation and amortization
a) Depreciation of fixed assets	-18,188	-18,417
b) Write-downs of inventories due to use	-3,754	-2,359
8. Other operating expenses	-54,094	-49,667
OPERATING RESULT	6,448	2,339
9. Financial income	1,624	888
10. Financial expenses	-11,241	-11,547
11. Share of the profit or loss of associated companies accounted for using the equity method	-40	-219
PROFIT BEFORE TAX	-3,209	-8,539
12. Income tax expense	-1,441	-1,027
NET PROFIT OR LOSS	-4,650	-9,566
of which attributable to shareholders of BAUER AG	-4,479	-9,319
of which attributable to minority interests	-171	-247

in EUR / share	01.01. - 31.03.2012 * 01.01. - 31.03.2013
Basic earnings per share	-0.26	-0.54
Diluted earnings per share	-0.26	-0.54
Average number of shares in circulation (basic)	17,131,000	17,131,000
Average number of shares in circulation (diluted)	17,131,000	17,131,000

STATEMENT OF COMPREHENSIVE INCOME OF THE BAUER GROUP

in EUR '000	01.01. - 31.03.2012 * 01.01. - 31.03.2013
Net profit or loss	-4,650	-9,566
Income and expenses not transferred to profit and loss
Actuarial gains/losses from defined benefit plans	-7,342	0
Deferred taxes on defined benefit plans with no effect on profit and loss	2,064	0
Income and expenses transferred to profit and loss
Market valuation of derivative financial instruments	-458	1,079
Included in profit and loss	0	-466
Deferred taxes on financial instruments with no effect on profit and loss	128	-303
Differences from currency translation	-3,881	3,850
Other result after tax	-9,489	4,160
Total profit	-14,139	-5,406
of which attributable to shareholders of BAUER AG	-13,710	-5,135
of which attributable to minority interests	-429	-271

* Previous year figures adjusted; the change relates to the first-time adoption of IAS 19 R

CASH FLOW STATEMENT OF THE BAUER GROUP

in EUR '000	31.03.2012	31.03.2013
Cash flows from operating activities	-45,271	-83,972
Cash flows from investing activities	-21,640	-13,978
Cash flows from financing activities	74,563	104,289
Changes in liquid funds affecting payments	7,652	6,339
Influence of exchange rate movements on cash	242	2,171
Total change in liquid funds	7,894	8,510
Cash and cash equivalents at beginning of reporting period	24,947	45,232
Cash and cash equivalents at end of reporting period	32,841	53,742
Change in cash and cash equivalents	7,894	8,510

BALANCE SHEET OF THE BAUER GROUP

A. NON-CURRENT ASSETS I. Intangible assets 34,567 II. Property, plant and equipment and investment property 465,316 III. Investments accounted for using the equity method 13,133 IV. Participations 3,638 V. Deferred tax assets 28,161 VI. Receivables from concession arrangements 40,770 VII. Other non-current assets 8,597 VIII. Other non-current financial assets 6,846 601,028 B. CURRENT ASSETS I. Inventories 429,794 II. Receivables and other assets 448,836	ASSETS in EUR '000	31.12.2012 *	31.03.2013
			34,606
			468,069
			12,932
			3,613
			27,912
			41,859
			9,188
			6,963
			605,142
			458,920
			486,357
III. Effective income tax refund claims 4,514			5,850
IV. Cash and cash equivalents 45,232			53,742
928,376			1,004,869
1,529,404			1,610,011

	EQUITY AND LIABILITIES in EUR '000	31.12.2012 *	31.03.2013
	A. SHAREHOLDERS' EQUITY
I.	Equity of BAUER AG shareholders	429,579	424,444
II.	Minority interests	33,205	32,934
		462,784	457,378
	B. NON-CURRENT LIABILITIES
I.	Defined benefit plans	80,080	80,412
II.	Financial liabilities	465,085	456,688
	III. Other liabilities	8,674	8,170
IV.	Deferred tax liabilities	19,397	19,493
		573,236	564,763
	C. CURRENT LIABILITIES
I.	Financial liabilities	190,542	320,756
II.	Other liabilities	281,257	245,387
	III. Effective income tax obligations	4,808	4,821
	IV. Provisions	16,777	16,906
		493,384	587,870
		1,529,404	1,610,011

* Previous year figures adjusted; the change relates to the first-time adoption of IAS 19 R

STATEMENT OF CHANGES IN EQUITY OF THE BAUER GROUP

Other revenue reserves and net earnings available for distribution in EUR '000
	Subscribed capital	Capital reserve	Revenue reserves	Foreign currency translation	Reconciling item, IFRS	Hedging transactions reserve	Own shares	Minority interests	Total
As at 01.01.2012	73,001	38,404	306,836	10,019	10,387	-1,933	0	33,720	470,434
First-time adoption of IAS 19 R	0	0	-9,206	0	0		0	-83	-9,289
Figures as at 01.01.2012 adjusted	73,001	38,404	297,630	10,019	10,387	-1,933	0	33,637	461,145
Net profit or loss	0	0	-4,479	0	0	0	0	-171	-4,650
Differences from currency translation	0	0	0	-3,675	0	0	0	-206	-3,881
Change in actuarial gains and losses	0	0	-7,270	0	0	0	0	-72	-7,342
Market valuation of derivative financial instruments	0	0	0	0	0	-458	0	0	-458
Deferred taxes with no effect on profit and loss	0	0	2,044	0	0	128	0	20	2,192
Total profit	0	0	-9,705	-3,675	0	-330	0	-429	-14,139
Changes in scope of consolidation	0	0	-4	0	0	0	0	850	846
Dividend payments	0	0	0	0	0	0	0	0	0
Other changes	0	0	0	0	0	0	0	0	0
As at 31.03.2012	73,001	38,404	287,921	6,344	10,387	-2,263	0	34,058	447,852
As at 01.01.2013	73,001	38,404	324,234	7,373	10,387	-3,722	0	33,398	483,075
First-time adoption of IAS 19 R	0	0	-20,098	0	0	0	0	-193	-20,291
Figures as at 01.01.13 adjusted	73,001	38,404	304,136	7,373	10,387	-3,722	0	33,205	462,784
Net profit or loss	0	0	-9,319	0	0	0	0	-247	-9,566
Differences from currency translation	0	0	0	3,874	0	0	0	-24	3,850
Change in actuarial gains and losses	0	0	0	0	0	0	0	0	0
Market valuation of derivative financial instruments	0	0	0	0	0	613	0	0	613
Deferred taxes with no effect on profit and loss	0	0	0	0	0	-303	0	0	-303
Total profit	0	0	-9,319	3,874	0	310	0	-271	-5,406
Changes in scope of consolidation	0	0	0	0	0	0	0	0	0
Dividend payments	0	0	0	0	0	0	0	0	0
Other changes	0	0	0	0	0	0	0	0	0
As at 31.03.2013	73,001	38,404	294,817	11,247	10,387	-3,412	0	32,934	457,378

SEGMENT REPORTING OF THE BAUER GROUP

in EUR '000	Construction		Equipment			Resources		Other
01.01. - 31.03.	2012 *	2013	2012 *	2013	2012 *	2013	2012 *	2013
Total revenues (Group)	156,870	153,609	140,659	152,624	58,099	39,158	7,738	8,123
Sales revenues with third parties	138,839	124,351	93,607	104,139	53,637	33,963	134	143
Sales revenues between business segments	3,726	4,064	11,752	10,218	667	289	7,210	7,570
Changes in inventories	796	312	29,372	33,419	1,785	2,229	0	0
Other capitalized goods and services for own account	39	65	1,021	975	17	120	0	0
Other income	4,546	5,248	4,113	2,936	705	1,255	178	126
CONSOLIDATED REVENUES	147,946	134,040	139,865	151,687	56,811	37,856	7,522	7,839
OPERATING RESULT	2,277	325	4,984	3,773	-624	-2,383	-75	255
Financial income	514	274	859	142	522	625	1,850	1,532
Financial expenses	-4,070	-5,264	-5,814	-4,802	-2,372	-2,231	-1,106	-935
Share of the profit or loss of associated companies accounted for using the equity method	-130	-216	11	4	79	-7	0	0
Income tax expense	-921	433	-314	-1,590	-102	438	-216	-209
NET PROFIT OR LOSS	-2,330	-4,448	-274	-2,473	-2,497	-3,558	453	643
	31.12.2012	31.03.2013	31.12.2012	31.03.2013	31.12.2012	31.03.2013	31.12.2012	31.03.2013
SEGMENT ASSETS **	555,983	575,853	748,335	756,434	283,996	290,938	298,535	271,463

ADDITIONAL INFORMATION ON THE INCOME STATEMENT

Depreciation and amortization

Depreciation of fixed assets	-10,681	-11,210	-4,212	-3,814	-2,500	-2,571	-795	-822
Write-downs of inventories due to use	0	0	-3,754	-2,359	0	0	0	0

in EUR '000	Consolidation		Group
01.01. - 31.03.	2012	2013	2012 *	2013
Total revenues (Group)	-23,387	-22,281	339,979	331,233
Sales revenues with third parties			286,217	262,596
Sales revenues between business segments	-23,355	-22,141	0	0
Changes in inventories	0	0	31,953	35,960
Other capitalized goods and services for own account	0	858	1,077	2,018
Other income	-380	-39	9,162	9,526
CONSOLIDATED REVENUES	-23,735	-21,322	328,409	310,100
OPERATING RESULT	-114	369	6,448	2,339
Financial income	-2,121	-1,685	1,624	888
Financial expenses	2,121	1,685	-11,241	-11,547
Share of the profit or loss of associated companies accounted for using the equity method	0	0	-40	-219
Income tax expense	112	-99	-1,441	-1,027
NET PROFIT OR LOSS	-2	270	-4,650	-9,566
	31.12.2012	31.03.2013	31.12.2012	31.03.2013
SEGMENT ASSETS **	-357,445	-284,677	1,529,404	1,610,011

ADDITIONAL INFORMATION ON THE INCOME STATEMENT

Depreciation and amortization Depreciation of fixed assets 0 0 -18,188 -18,417 Write-downs of inventories due to use 0 0 -3,754 -2,359

* Previous year figures adjusted; the change relates

to the first-time adoption of IAS 19 R

** Previous year figures grossed

Notes to the Financial Statements

ACCOUNTING PRINCIPLES

BAUER Aktiengesellschaft, Schrobenhausen (referred to in the following as BAUER AG) prepares its interim financial statements in accordance with the International Financial Reporting Standards (IFRS). The Interim Report to March 31, 2013 was prepared on the basis of IAS 34, "Interim Financial Reporting".

With effect from the start of the 2013 financial year BAUER AG is changing its accounting and valuation methods in respect of provisions for defined benefit plans based on its first-time adoption of IAS 19 R. It stipulates that actuarial gains and losses are to be recorded immediately in the period in which they occur, under "Other result".

The first-time adoption of IAS 19 R had the following effects on the period result, the Group's equity and the provisions for defined benefit plans of the comparative period:

Net profit or loss:

Staff costs in first-quarter 2012 decreased by the previously included expenses from the amortization of actuarial gains and losses in an amount of EUR 277 thousand. Of that total, EUR 79 thousand was income tax expense, resulting in a EUR 198 thousand effect on the period result.

Group equity and provisions for defined benefit plans:

The setting-off of actuarial gains and losses increased provisions for defined benefit plans by EUR 28,221 thousand as per December 31, 2012. Of that total, EUR 7,930 thousand related to deferred taxes, resulting in a reduction in the Group's equity of EUR 20,291 thousand.

Otherwise, the same accounting and valuation methods as for the consolidated financial statements to December 31, 2012 are applied in the Interim Report to March 31, 2013. A detailed description of those methods is presented in the 2008 Annual Report.

The Standards and Interpretations bindingly applicable for the first time with effect from January 1, 2013 otherwise had no significant effects on the net asset, financial and earnings position of the Group.

AUDITING

These consolidated interim financial statements and management report have not been audited in accordance with Section 317 of the German Commercial Code (HGB), nor have they been subjected to any review by an auditor.

SCOPE OF CONSOLIDATION

The scope of consolidation includes BAUER AG and all major subsidiaries. Subsidiaries are all companies over which the parent has control in terms of financial and corporate policy. This is routinely accompanied by a voting share of over 50 percent. When assessing whether control is exerted, the existence and effect of potential voting rights currently exercisable or convertible are considered.

In a small number of cases, companies are fully consolidated into the financial statements of BAUER AG even though that company holds less than 50 percent of their voting rights. This is the result of state restrictions which stipulate that foreign investors may not hold more than 50 percent of the voting rights in domestic companies. In such cases, BAUER AG makes use of so-called agency constructions, whereby more than 50 percent of the voting rights are commercially held in the company concerned, thus allowing for full consolidation.

Subsidiaries are included in the consolidated financial statements (fully consolidated) from the point at which control is transferred to the Group. They are de-consolidated at the point when control ends.

Companies of which BAUER AG is able, directly or indirectly, to exercise a significant influence on the said companies' financial and operating policy decisions (associated companies) are consolidated according to the equity method.

Bauer + Moosleitner Entsorgungstechnik GmbH, Salzburg, Austria, was consolidated for the first time with effect from March 31, 2013. The company is newly established.

No further changes have occurred to the scope of consolidation since December 31, 2012.

NOTES ON SEGMENT REPORTING

The internal organizational and management structure and the internal system of reporting to the Management Board and Supervisory Board dictate the segmentation employed by the BAUER Group.

The BAUER Group comprises the Construction, Equipment and Resources segments. Transactions between the segments are conducted at market prices.

SCHACHTBAU NORDHAUSEN GmbH is the only Group company to operate in all three segments. The assets, liabilities, total Group revenues, sales revenues with third parties and net profit of SCHACHTBAU NORDHAUSEN GmbH are assigned to the relevant segments. No breakdowns of the other items were made in segment reporting, as they were not classed as material.

Construction

The core business of the Construction segment is specialist foundation engineering. Complete excavation pits and foundation works, often in difficult subgrade conditions, are carried out for major infrastructure projects and buildings. In order to offer customers a full range of services, the companies of the BAUER Group additionally offer other construction services, often involving a major specialist foundation engineering element. Examples of this include bridges, environmental engineering, remediation and building renovation projects. In order to portray development trends, the Construction segment sales are additionally broken down into the subdivisions of "Specialist Foundation Engineering, Germany" and "Specialist Foundation Engineering, International" in the management report. The Construction segment is founded on the close interlinking of all construction activities.

Equipment

In the Equipment segment, machinery for all specialist foundation engineering processes and for deep drilling is developed and manufactured for worldwide distribution. The specialist foundation engineering equipment can be employed to produce large-diameter and small-diameter bores for piles, diaphragm walls, anchors, injections and wells. The deep drilling equipment can be employed to drill for geothermal energy, oil and gas. Equipment for ramming and soil improvement is also manufactured. The range is supplemented by a wide selection of add-on units and ancillary equipment, covering all the processes involved in specialist foundation engineering.

Resources

The Resources segment brings together all the Group companies providing products and services relating to the remediation and extraction of natural resources essential to human life. They include environmental technology companies involved in the treatment of ground and groundwater as well as companies involved in exploratory drilling and mining of raw materials and drilling of wells and geothermal energy sources. This segment also includes companies which manufacture and sell materials for the engineering of bore holes, specifically for wells and geothermal energy sources.

The Other segment comprises the central services (accounting, human resources, IT etc.) provided by BAUER AG to the Group companies as well as other units not assignable to the separately listed segments, providing services such as inhouse and external education and training and centralized research and development.

The intersegmental consolidation effects in this context are grouped under Consolidation. This includes offsetting of intra-Group sales between the segments as well as income and expenses and interim results. The intrasegmental consolidation effects are adjusted within the respective segments.

TOTAL GROUP REVENUES, CONSOLIDATED REVENUES AND SALES REVENUES WITH THIRD PARTIES

The consolidated revenues reflect the performance of all the companies included in the scope of consolidation. The total Group revenues represent the revenues of all the companies forming part of our Group. The difference between the consolidated revenues and the total Group revenues is derived from the revenues of the associated companies, from our subcontractor shares in consortia, and from the revenues of non-consolidated companies. The sales revenues with third parties are allocated to the business segments according to the customer's location.

No one customer accounts for more than 10 percent of total sales.

No breakdown of sales revenues by product and service, or by groups of comparable products and services, was available as per the balance sheet date.

EVENTS AFTER MARCH 31, 2013

No findings subject to mandatory reporting in accordance with IAS 10 occurred after March 31, 2013.

MATERIAL TRANSACTIONS WITH RELATED PARTIES

The relationships between fully consolidated Group companies and related companies and persons relate mainly to associated and joint-venture companies. Transactions with the said companies are transacted at standard market terms. In the period under review no material transactions were undertaken with related parties.

CONTINGENT LIABILITIES

Contingent liabilities arising from guarantees to third parties exist in an amount of EUR 4,452 thousand (December 31, 2012: EUR 4,452 thousand). In addition, we are subject to joint and several liability in respect of all joint ventures in which we participate.

Schrobenhausen, May 15, 2013

The Management Board

Prof. Dipl.-Kfm. Thomas Bauer Dipl.-Betriebswirt (FH) Hartmut Beutler Dipl.-Ing. Heinz Kaltenecker Chairman of the Management Board

FUTURE-RELATED STATEMENTS

This Interim Report contains future-related statements. Future-related statements are any statements which do not relate to historical facts and events, such as forecasts of future financial earning power and indications of plans and expectations with regard to the development of the business of the BAUER Group and relating to the general economic climate or other factors to which the BAUER Group is subject. The use of words such as "believe", "expect", "predict", "forecast", "intend", "plan", "estimate", "aim", "likely", "assume" and similar formulations indicates that the statements in question are futurerelated. Future-related statements are subject to risks and many uncertainties which may mean that actual developments, earnings or levels of performance differ widely from those explicitly or implicitly assumed in the future-related statements.

Readers are advised that, in view of the said risks and uncertainties, no inappropriately high degree of confidence should be placed in the likelihood of such statements proving to be accurate in the future. BAUER Aktiengesellschaft does not intend to and assumes no obligation to publish updates of such future-related statements in order to incorporate events or circumstances beyond the date of publication of this Interim Report.

FINANCIAL CALENDAR 2013

April 11, 2013	Publication of 2012 Annual Report Annual Press Conference Analysts' Conferenc
May 15, 2013	Interim Report to March 31, 2013
June 27, 2013	Annual General Meeting
August 14, 2013	Half-Year Interim Report to June 30, 2013
November 14, 2013	Interim Report to September 30, 2013

You will find more information on the BAUER Group on the Internet at www.bauer.de.

PUBLISHED BY

BAUER Aktiengesellschaft BAUER-Strasse 1 86529 Schrobenhausen, Germany

Office of the Management Board: Phone: 08252 97-1215 Fax: 08252 97-2900 e-mail: BAG@bauer.de

Registered place of business: 86529 Schrobenhausen, Germany Registered at the District Court of Ingolstadt under HRB 101375

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