CANCOM SE — Interim / Quarterly Report 2010

Aug 24, 2010

6-month-report 2010

»Leading provider of IT infrastructure and professional services«

Table of contents

Section	Page
Table of contents	02
Preface – Key figures	03
Consolidated interim management report Q2	04-09
1) CANCOM's business and the general economic situation 2) Earnings, financial and assets situation of the CANCOM group 3) Shareholdings of the Executive and Supervisory Board	04-05 05-07 08
4) Events of particular significance after the reporting date 5) Risk report	08 08
6) Opportunities report 7) Forecast 8) Responsibility statement by the management	08 08 09
Balance sheet	10-11
Income statement
Consolidated cash flow statement – IFRS	13
Consolidated statement of changes in equity – IFRS	14
Statement of comprehensive income – IFRS	15
Segment information – IFRS	16-17
Appendix	18-22

CONTENT

Preface – Key figures

Dear shareholders,

The impressive performance of the CANCOM share during the past few weeks and months mirrors the positive development of the Group's business in the first half of the year. We are delighted to be able to report our best half-year results in the history of the company, with new records set for growth in both sales revenues and profits.

Since the start of the year there has been a noticeable upturn in the economy and in

companies' appetite for investment, which gave our incoming orders a major boost. We see further potential for growth arising from the Group's strategic redirection and in the focus of the corporate portfolio on the cloud computing megatrend. We aim to achieve higher profit margins in the medium-term by consistently directing our sales and service activities towards proven highprofit and high-growth market segments such as IT solutions, consulting and managed services. With our CANCOM AHP Private Cloud, we are the best positioned integrated systems provider in Germany in the area of cloud computing.

We are equally optimistic about the second half of the current financial year, and the most recent large-scale orders we have received show that our positive assessment is justified. To safeguard what we have achieved so far and to promote our future growth, we have also attracted new investors, thus broadening CANCOM's shareholder base to include more shareholders outside Germany.

We are grateful for your confidence and hope you will continue to support us. The numerous analyst recommendations show that CANCOM is still an attractive investment.

Kind regards,

Klaus Weinmann, CEO

Key figures

in Euro million

Kennzahlenübersicht CANCOM Konzern in Mio. €	01/01/ - 06/30/2010	01/01/ - 06/30/2009	Veränderungen/ Change	Overview of key figures CANCOM group in € million
Umsatzerlöse	239.2	204.5	+ 17.0 %	Revenue
Rohertrag	71.0	56.2	+ 26.3 %	Gross profit
Rohertragsmarge in %	29.7 %	27.5 %	+ 2.2 %	Gross margin
EBITDA Konzern	5.7	2.9	+ 96.6 %	EBITDA
EBIT Konzern	3.7	1.6	+ 131.3 %	EBIT
Periodenergebnis	2.1	0.9	+ 133.3 %	Net profit before minority interests
Ergebnis pro Aktie (in €)				Earnings per share (in €)
(verwässert)	0.20	0.09	+ 122.2 %	from continuing operations /diluted)
Durchschnittliche Aktienzahl				Adjusted average number of shares
(in 1.000) (verwässert)	10,319	10,391	- 0.7 %	(in 1,000) (diluted)
Mitarbeiter zum 30.06.	1,984	1,664	+ 19.2 %	Employees as of 30 June
			Veränderungen/
in Mio. €	06/30/2010	12/31/2009	Change	in € million
Bilanzsumme	136.1	134.9	+ 0.9 %	Balance sheet total
Eigenkapital	44.3	43.9	+ 0.9 %	Equity
Eigenkapitalquote in %	32.5 %	32.5 %	+ 0.0 %	Equity ratio

1. CANCOM's business and the general economic situation

Organisational and legal structure of the CANCOM Group

CANCOM IT Systeme Aktiengesellschaft, based in Jettingen-Scheppach, Germany, performs the central financial and management role for the equity investments held by the CANCOM Group.

Focus of activities and sales markets

One of the three largest independent integrated systems providers in Germany, the CANCOM Group has steadily been transformed over the last few years through strategic acquisitions from a systems house focusing primarily on hardware and software, into an IT architect, IT systems integrator and Managed Service Provider. As a provider of integrated services, its central focus is now on providing IT ser-vices in addition to selling hardware and software from prestigious manufacturers. Its IT services range includes design and integration of IT systems, as well as sys-tem operation.

The CANCOM Group's customer base therefore includes primarily commercial end-users, from independent professionals to medium and large-sized companies and public-sector institutions. Through the e-commerce platform of HOH Home of Hardware GmbH at www.hoh.de, the CANCOM Group provides products and ser-vices to private as well as business customers.

Explanation of the control system used within the Group

To control and monitor the development of the individual subsidiaries, once a month CANCOM analyses, among other things, their sales revenues, gross profit, operating expenditure and operating profit, and compares these key figures with the original plan as well as the quarterly forecast. Additionally, the Company regularly uses external indicators such as inflation rates, interest rates, the general economic trend and the performance of the IT sector – as well as forecasts for these – for the purpose of management control. The cash management procedures include a daily status investigation.

Research and development activities

Innovation is very important for economic momentum and growth. CANCOM concentrates its research and development activities on IT growth segments such as Cloud Computing, virtualisation solutions, managed services, online technologies, systems development and process optimisation.

Overview of the CANCOM Group's business performance

In the first half of 2010, the CANCOM Group's consolidated sales revenues rose by 17.0 percent to € 239.2 million, compared with € 204.5 million. Consolidated gross profits grew by 26.3 percent year-on-year, from € 56.2 million to € 71.0 million, and the gross profit margin was up from 27.5 percent in the second quarter of 2009 to 29.7 percent in the second quarter of

1. Consolidated EBITDA was up 96.6 percent year-on-year, at € 5.7 million compared with € 2.9 million, giving an EBITDA margin of 2.4 percent. Consolidated EBIT rose by 131.3 percent to € 3.7 million, compared with € 1.6 million in the second quarter of 2009. Overall, CANCOM made a net income of € 2.1 million in the second quarter of 2010, com-pared with € 0.9 million in the same quarter of 2009, resulting in earnings per share of € 0.20 compared with € 0.09 in the first half of 2009.

Significant events and investments

CANCOM Bürotex GmbH has acquired the remaining 25.0 percent of the shares of Live Netzwerk und Computer GmbH, increasing its shareholding to 100 percent. The acquisition is documented in a contract dated on 7 May 2010. On the same date, Live Netzwerk und Computer GmbH and CANCOM Bürotex IT solutions GmbH were merged into CANCOM Bürotex GmbH with effect from 1 January 2010.

During the first half of 2010, CANCOM IT Systeme Aktiengesellschaft acquired shares in Plaut Aktiengesellschaft. The equity investment in Plaut Aktiengesell-schaft is reported as an associated company under financial assets accounted for us-ing the equity method, as CANCOM IT Systeme Aktiengesellschaft holds more than 20 percent of the voting rights (20.507 percent), and thus exercises a significant influence on the company.

Employees

As at 3 June 2010 the Group employed 1,984 people.

The employees worked in the following areas (as at 30 June 2010):

Professional services:	1,301
Sales and distribution:	350
Marketing and product services:	31
Purchasing, logistics and order processing:	134
Central services:	168

The personnel expenses in the first six months were as follows (in € '000):

	01/01/ - 06/30/2010	01/01/ - 06/30/2009
Wages and salaries	42,247	34,522
Social security contributions	7,745	6,267
Pension provisions	157	73
Total	50,149	40,862

2. Earnings, financial and assets position of the CANCOM Group

a) Earnings position

There was a considerable year-on-year increase in sales revenues in the first six months of 2010. The consolidated sales revenues of the CANCOM Group rose by 17.0 percent year on year, from € 204.5 million to € 239.2 million. The significant growth is partly owing to the improved general economic conditions, but also to the inclusion of the recently acquired CANCOM Bürotex and CANCOM SCC in the consolidated financial statements.

Note: some adjustments to the figures for the first half of 2009 have been necessary to take into ac-count businesses that were classified as discontinued operations in the first half of 2009 in compli-ance with IFRS 5.

CANCOM Group sales revenues: year-on-year comparison of first half figures, 2009 and 2010 (in € million)

In Germany, the sales revenues for the first six months of 2010 were up 17.3 percent year on year, from € 187.4 million to € 219.9 million. This growth is partly owing to the acquisition of CANCOM Bürotex and CANCOM SCC.

In international business, the CANCOM Group's sales revenues rose by 12.3 percent, from € 17.1 million to € 19.2 million.

In the e-commerce/trade segment, sales revenues were up 2.8 percent, from € 105.5 million to € 108.5 million. In the IT solutions segment they were up 32.0 percent, from € 99.0 million to € 130.7 million.

The consolidated gross profit for the first six months of 2010 was up 26.3 percent year on year, from € 56.2 million to € 71.0 million.

The gross profit margin rose from 27.5 percent to 29.7 percent, mainly as a result of the focus on high-income and high-growth market segments such as IT solutions, consulting and managed services.

CANCOM Group's gross profit: year-on-year comparison of first half figures, 2009 and 2010 (in € million)

Consolidated EBITDA was up 96.6 percent on the same period in 2009, at € 5.7 million compared with € 2.9 million.

CANCOM Group's EBITDA: year-on-year comparison of first half figures, 2009 and 2010 (in € million)

Consolidated EBIT amounts to € 3.7 million, as compared with € 1.6 million in the first half of 2009, equivalent to a growth of 131.3 percent.

CANCOM Group's EBIT: year-on-year comparison of first half figures, 2009 and 2010 (in € million)

The net income for the first six months of 2010 amounted to € 2.1 million, in comparison with € 0.9 million in 2009. As a result, earnings per share were € 0.20, compared with € 0.09 for the first six months of 2009.

The order position

In the e-commerce/trade segment and parts of the IT solutions segment, the majority of incoming orders are converted to sales within two weeks because of our large delivery capacity. Consequently, the reporting date figures on their own do not give a true picture of our order situation in this area of business, which is why they are not published.

In the IT solutions segment, orders are often given over long periods. At present, the volume of orders is rising slightly.

Because of the stable services business – which now accounts for about two thirds of the gross profits (total output less material costs and services rendered) – as well as the healthy condition of the balance sheet, the management feels the Group is in a strong position within the IT sector.

Explanations of individual items on the income statement

Further details on items in the income statement are given in the Notes to the consolidated income statement.

b) Financial and assets position

Objectives of financial management

The core objective of the financial management of the CANCOM Group is to safeguard its liquidity at all times, to ensure that day-to-day business activities can be continued. In addition, the Group aims to achieve optimum profitability as well as a high credit status to ensure favourable refinancing rates.

Notes on the capital structure

On the assets side of the consolidated balance sheet, there was a 7.2 percent decrease in current assets between 31 December 2009 and 30 June 2010, from € 93.2 million to € 86.5 million. Cash and cash equivalents are down from € 25.8 million to € 5.3 million owing to seasonal effects. Inventories are up 52.3 percent, from € 12.6 million to € 19.2 million, mainly owing to growth and ac-quisitions. Trade accounts receivable were also up, from € 47.2 million to € 54.6 million.

Non-current assets are up 18.9 percent, from € 41.7 million at 31 December 2009 to € 49.6 million at 30 June 2010. Intangible assets are up from € 6.7 million to € 10.3 million. Financial assets overall were up from € 0.2 million to a total of € 2.8 million, mainly as a result of the equity investment in Plaut Aktiengesellschaft, in which the Group now holds an interest of more than 20 percent. The company is shown under financial assets accounted for using the equity method.

On the liabilities side of the balance sheet, there has been a 1.2 percent reduction in current liabilities from € 67.5 million to € 66.7 million. This is mainly owing to a fall in trade accounts payable from € 47.9 million to € 42.3.

Non-current liabilities, which comprises liabilities with a residual term of at least one year, are up from € 23.5 million to € 25.0 million.

The balance sheet total was up to € 136.1 million as at 30 June 2010, compared with € 134.9 million at 31 December 2009.

The nominal equity capital has been increased from € 43.9 million to € 44.3 million since the start of the year, mainly through transfers to net profits. Overall, this resulted in an constant equity ratio of 32.5 percent at 30 June 2010 compared with 31 December 2009.

Further details of the individual balance sheet items can be found in the Notes to the consolidated balance sheet.

Notes to the statement of cash flows

The cash flow from ordinary activities is typically highly negative during the course of the year, and there was a negative cash flow of € 11.5 million as at 30 June 2010. The change in comparison with the same date in 2009 was influenced by various factors.

These include the expansion of business activities, the increase in trade accounts re-ceivable, and the change in inventories following company takeovers, as well as re-plenishment of stocks to take advantage of favourable purchase conditions. The other factor was a reduction in trade accounts payable.

The negative cash flow from investing activities increased from a negative cash flow of € 0.4 million to a negative cash flow of € 10.5 million. The reasons for this were the payment of the purchase price for the acquisition of the Bürotex com-panies and the acquisition of an equity investment in Plaut Aktiengesellschaft. On top of this, the available cash was invested in fixed assets, resulting in a reduction in future financing and lease payments.

The cash flow from financing activities was up from € -0.9 million to € 1.4 million.

Overall, this gave rise to cash and cash equivalents of € 5.3 million, compared with € 7.8 million in 2009.

3. Shares held by members of the Executive and Supervisory Boards as at 30 June 2010

Total numbers of shares:	10,390,.751	100%
Executive Board:
Klaus Weinmann	543,312	5.23%
Paul Holdschik	1	0.00%
Rudolf Hotter	175,000	1.68%
Supervisory Board:
Walter von Szczytnicki	6,252	0.06%
Dr. Klaus F. Bauer	1,500	0.01%
Stefan Kober	826,289	7.95%
Raymond Kober	920,891	8.86%
Walter Krejci	10,000	0.10%
Regina Weinmann	100,000	0.96%

4. Events of particular significance after the reporting date

On 27 July 2010, CANCOM Bürotex GmbH, based in Nürtingen, Germany, was merged into CANCOM SCC GmbH, Stuttgart, Germany with retroactive effect from 1 January 2010.

5. Risk report

There have been no major changes in the risks of future development at CANCOM since the start oft he current financial year. Details of the risks can be found in the annual report for 2009, starting on page 21. The annual report can be downloaded from www.cancom.de or obtained free of charge from the Company.

6. Opportunities report

There have been no major changes in the opportunities of future development at CANCOM since the start oft he current financial year. Details of the opportunities can be found in the annual report for 2009, starting on page 25.

7. Forecast

The German economy is gathering pace again. According to government estimates, gross domestic product grew considerably more strongly in the second quarter of this year than in the first quarter, even exceeding the government's own forecasts. From April to June the growth rate was more than 1.5 percent, compared with the government's forecast of 0.9 percent growth over this period. Industry is profiting from both the impetus from foreign trade and the recovery in domestic investment activity.

The German government has up to now been forecasting growth of 1.4 percent for the year as a whole, but if the economic recovery so far is any indication of the fu-ture trend, this figure could turn out somewhat higher than expected.

Forecasts for economic growth in 2010 range between 4.5 percent (global) and 2.0 percent (Germany). (Source: Deutsche Bank Economic Research Bureau, Frank-furt/Main, Germany, 15 July 2010.)

According to the latest market figures from the German Federal Association for In-formation Technology, Telecommunications and New Media, BITKOM, the ex-perts expect growth of about 1.4 percent in the western European IT market in 2010, after shrinkage of 5.4 percent in 2009.

They forecast 2.2 percent growth in the IT services segment following a decline of 2.5 percent in 2009, while they expect the software and hardware segments to grow by 0.9 percent and 0.2 percent respectively, after a decline of 5.2 percent and 10.6 percent respectively in 2009.

Trend in the German IT sector in 2010*

(real change in comparison to 2009 as a percentage) 5 4 3 2 1 0 -1 1.4 -2 IT market as a whole 0.2 Hardware 0.9 Software 2.2 IT services

According to a study by the market research company IDC, global IT sales are set to grow by 3.8 percent by the end of the year 2010. Growth is expected to come from the hardware segment in particular, where turnover could rise by 6.4 percent. In the study, analysts monitored capital expenditure on network technology, server systems and IT services in companies of all sizes since the start of the year.

This positive development will give particular impetus to our business as a provider of integrated high-tech solutions. CANCOM will profit especially from the cloud computing trend.

Cloud computing is the dynamic provisioning, management and billing of IT resources via a network, for example the internet or a company's internal network – an intranet or private cloud. This enables great savings to be made on local re-sources.

Sector experts and market research companies forecast huge global growth in the market for cloud computing over the next few years. In Germany alone, average annual growth rates of almost 40 percent are expected.

The U.S. market research company Forrester sees huge potential for growth in the e-commerce segment for the next two years, with annual growth rates of 7 percent, while it expects the consumer electronics segment to grow by as much as 11 percent. BITKOM's assessment is in line with Forrester's.

CANCOM geared its business policy to these future IT trends at an early stage and structured and concentrated the Group's sales and services activities consistently around proven high-profit and high-growth market segments such as IT solutions, consulting and managed services.

CANCOM has expanded its market presence as well as improving its customer proximity in the German-speaking countries, and is represented all over Germany and Austria by its many service and consulting locations.

The improvement and streamlining of logistics processes as well as the concentration of administrative tasks at the company's head office should result in major cost savings. By means of cross selling, synergies and best practices, we are reducing costs and pooling our resources, enabling CANCOM to operate even more competitively in the future. The resulting benefits will bring added value to CANCOM and to its customers and business partners.

In view of the acquisitions and the positive business development as well as the improved economic conditions in 2010 and 2011, the Executive Board generally ex-pects a future growth in sales revenues and result with a continued positive financial situation. CANCOM's plans are consolidated sales revenues of € 500 million (fi-nancial year 2010) and € 530 million (financial year 2011), consolidated EBITDA of € 11.6 million (financial year 2010) and € 13.1 million (financial year 2011) and earnings per share up to at least € 0.60 in 2010 and € 0.70 in 2011.

From the current point of view, the company's guidance for the financial year 2010, especially for EBITDA, may even be exceeded in consideration of the improved economic outlook and the company's strong positioning in the high-potential cloud computing market.

The Executive Board advises that actual results may deviate significantly from ex-pectations.

8. Responsibility statement by the management

To the best of our knowledge, and in accordance with the applicable reporting principles for interim financial reporting, the interim consolidated financial statements give a true and fair view of the assets, liabilities, financial position and profit or loss of the Group, and the interim management report of the Group includes a fair review of the development and performance of the business and the position of the Group, together with a description of the principal opportunities and risks associated with the expected development of the Group for the remaining months of the financial year.

Jettingen-Scheppach, August 2010 CANCOM IT Systeme AG

The Executive Board

This document has not been audited. It contains statements and information about the future that are based on the assumptions and estimates of the Executive Board of CANCOM IT Systeme Aktiengesellschaft. These statements are identifiable by words and phrases such as "plan", "intend", "will", "expect", "we feel" etc. and are based on current expectations, assumptions and assessments. Although we feel that these expectations are realistic, we cannot guarantee their correctness. The as-sumptions may be subject to several internal and external risks and uncertainties, which may lead to the actual results deviating considerably, either positively or negatively, from the situations and figures forecast. The following influencing factors are relevant in this respect: changes in the general economic and business situation; changes in interest rates and foreign currency exchange rates; changes in the competitive situation, for instance by the emergence of new competitors, new products and services or new technologies; changes in the consumer habits of target customer groups etc.; and changes to the business strategy. CANCOM does not plan to update its forecasts beyond the legal requirements, nor does it make any commitment to do so.

Consolidated balance sheet (ifrs) – assets

Zahlenangaben in T€					Figures in € '000
Aktiva	Notes	06/30/2010	12/31/2009	01/01/2009	Assets
Kurzfristige Vermögenswerte					Current assets
Zahlungsmittel und Zahlungsmitteläquivalente		5,271	25,836	18,282	Cash and cash equivalents
Zur Veräußerung gehaltene Vermögenswerte		0	0	3,378	Assets held for sale
Forderungen aus Lieferungen und Leistungen		54,599	47,191	44,175	Trade accounts receivable
Sonstige kurzfristige finanzielle Vermögenswerte	B.1.	3,359	3,223	4,141	Other current financial assets
Vorräte		19,231	12,589	10,080	Inventories
Aufträge in Bearbeitung		1,813	990	1,140	Orders in process
Rechnungsabgrenzungsposten und					Prepaid expenses and
sonstige kurzfristige Vermögenswerte	B.2.	2,225	3,384	2,099	other current assets
Kurzfristige Vermögenswerte, gesamt		86,498	93,213	83,295	Total current assets
Langfristige Vermögenswerte					Long-term assets
Sachanlagevermögen		8,440	6,529	5,401	Property, plant and equipment
Immaterielle Vermögenswerte		10,253	6,730	4,544	Intangible assets
Geschäfts- oder Firmenwert		24,823	24,812	23,787	Goodwill
Finanzanlagen		70	157	129	Investments
Nach der Equity-Methode bilanzierte Finanzanlagen	B.3.	2,770	0	13	Investments accounted for by the equity method
Ausleihungen		0	0	199	Notes receivable/loans
Sonstige finanzielle Vermögenswerte		758	822	766	Other financial assets
Latente Steuern aus temporären Differenzen	B.4.	312	338	394	Deferred taxes arising from temporary differences
Latente Steuern aus steuerlichem Verlustvortrag	B.4.	1,976	2,224	2,088	Deferred taxes arising from tax loss carryover
Sonstige Vermögenswerte		193	77	58	Other assets
Langfristige Vermögenswerte, gesamt		49,595	41,689	37,379	Total long-term assets
Aktiva, gesamt		136,093	134,902	120,674	Total assets

Consolidated balance sheet (ifrs) – Equity and liabilities

Zahlenangaben in T€ Passiva	Notes	06/30/2010	12/31/2009	01/01/2009	Figures in € '000 Equity and liabilities
Kurzfristige Schulden					Current liabilities
Kurzfristige Darlehen und kurzfristiger Anteil an					Short term debt and
langfristigen Darlehen		3,793	707	1,800	current portion of long-term debt
Verbindlichkeiten aus Lieferungen
und Leistungen		42,343	47,852	39,257	Trade accounts payable
Erhaltene Anzahlungen		1,296	1,140	1,951	Advanced payments redeived
Sonstige kurzfristige finanzielle Schulden	B.5.	1,845	3,158	2,547	Other current financial liabilities
Rückstellungen	B.6.	2,933	3,905	2,630	Accrued expenses
Rechnungsabgrenzungsposten		909	908	835	Deferred revenues
Verbindlichkeiten aus Ertragssteuern		553	438	529	Income tax payable
Sonstige kurzfristige Schulden	B.7.	13,040	9,437	9,690	Other current liabilities
Schulden im Zusammenhang mit zur Veräußerung
gehaltenen Vermögenswerten		0	0	1,590	Liabilities associated with held for sale
Kurzfristige Schulden, gesamt		66,712	67,545	60,829	Total current liabilities
Langfristige Schulden					Long-term liabilities
Langfristige Darlehen		5,922	5,194	5,014	Long-term debt, less current portion
Genussrechtskapital und nachrangige Darlehen		12,827	12,784	11,571	Profit-participation capital and subordinated loans
Rechnungsabgrenzungsposten		2,028	1,767	381	Deferred revenues
Latente Steuern aus temporären Differenzen	B.8.	2,636	1,967	1,287	Deferred taxes from temporary differences
Pensionsrückstellungen		26	26	150	Pension provisons
Sonstige langfristige finanzielle Schulden		376	491	1,207	Other long-term financial liabilities
Sonstige langfristige Schulden		1,230	1,259	1,319	Other long-term liabilities
Langfristige Schulden, gesamt		25,045	23,488	20,929	Total Long-term liabilities
Eigenkapital					Equity
Gezeichnetes Kapital	B.9.	10,391	10,391	10,391	Shared capital
Kapitalrücklage		15,441	15,441	15,441	Additional paid-in capital
Bilanzgewinn/Bilanzverlust					Net profit
(inklusive Gewinnrücklagen)		19,001	18,476	13,416	(incl. retained earnings)
Eigenkapitaldifferenz aus Währungsumrechnung		-258	-279	-324	Currency translation difference
Eigene Anteile zu Anschaffungskosten	B.9.	-259	-165	0
Minderheitenanteile		20	5	-8	Minority interests
Eigenkapital, gesamt		44,336	43,869	38,916	Total equity
Passiva, gesamt		136,093	134,902	120,674	Total equity and liabilities

Income statement (IFRS)

Zahlenangaben in T€		04/01/2010	04/01/2009	01/01/2010	01/01/2009	Figures in € '000
Gewinn- und Verlustrechnung	Notes	-06/30/2010		-06/30/2009 -06/30/2010	-06/30/2009	Income Statement
Umsatzerlöse		124,616	98,864	239,176	204,548	Revenues
Sonstige betriebliche Erträge	C.2.	232	578	1,445	775	Other operating income
Andere aktivierte Eigenleistungen		200	0	200	0	Other capitalised services rendered for own account
Gesamtleistung		125,048	99,442	240,821	205,323	Total operating revenue
Materialaufwand /						Cost of purchased
Aufwand für bezogene Leistungen		-89,979	-72,466	-169,786	-149,145	materials and services
Rohertrag		35,069	26,976	71,035	56,178	Gross profit
Personalaufwand	C.3.	-24,948	-19,759	-50,149	-40,862	Personnel expenses
Abschreibungen auf Sachanlagen						Depreciation of property, plant and equipment
und immaterielle Vermögensgegenstände		-1,098	-680	-2,046	-1,331	and amortisation of intangible assets
Sonstige betriebliche Aufwendungen	C.4.	-7,522	-6,039	-15,184	-12,419	Other operating expenses
Betriebsergebnis		1,501	498	3,656	1,566	Operating income
Zinsen und ähnliche Erträge		28	41	73	99	Interest and similar income
Zinsen und ähnliche Aufwendungen		-475	-345	-936	-710	Interest and other expenses
Abschreibungen auf Finanzanlagen		0	0	0	0	Write-downs of financial assets
Gewinn-Verlustanteile aus Joint Ventures,						Share in profit or loss from joint ventures
die nach der Equity-Methode bilanziert werden		0	0	0	0	accounted for by the equity method
Währungsgewinne / -verluste		-5	8	-20	10	Foreign currency exchange income / losses
Ergebnis vor Ertragsteuern		1,050	202	2,774	965	Profit before taxes
Ertragsteuern	C.5.	-350	200	-688	-80	Income tax expense
Ergebnis nach Steuern aus						After tax profit
aus fortzuführenden Geschäftsbereichen		700	402	2,086	885	from continuing operations
Ergebnis aus aufgegebenen Geschäftsbereichen		0	0	0	0	Loss from discontinued operations
Periodenergebnis		700	402	2,086	885	Net income for the year
davon entfallen auf Gesellschafter						thereof attributable to the
des Mutterunternehmens		690	422	2,072	915	shareholders of the parent
davon entfallen auf Minderheiten	C.6.	10	-20	14	-30	thereof attributable to minority interests
Durchschnittlich im Umlauf befindliche						Average number of
Aktien (Stück) unverwässert		10,316,422		10,390,751 10,318,520	10,390,751	shares outstanding (basic)
Durchschnittlich im Umlauf befindliche						Average number of
Aktien (Stück) verwässert		10,316,422	10,390,751	10,318,520	10,390,751	shares outstanding (diluted)
Ergebnis je Aktie aus						Earnings per share
fortzuführenden Geschäftsbereichen (unverwässert)		0.07	0.04	0.20	0.09	from continuing operations (non-diluted)
Ergebnis je Aktie aus						Earnings per share
fortzuführenden Geschäftsbereichen (verwässert)		0.07	0.04	0.20	0.09	from continuing operations (diluted)
Ergebnis je Aktie aus						Earnings per share
aufgegebenen Geschäftsbereichen (unverwässert)		0.00	0.00	0.00	0.00	from discontinued operations (non-diluted)
Ergebnis je Aktie aus						Earnings per share
aufgegebenen Geschäftsbereichen (verwässert)		0.00	0.00	0.00	0.00	from discontinued operations (diluted)

Consolidated cash flow statement (IFRS)

Zahlenangaben in T€		01/01/2010	01/01/2009	Figures in € '000
Kapitalfluss	Notes	-06/30/2010	-06/30/2009	Cashflow
Cashflow aus gewöhnlicher Geschäftstätigkeit:				Cash flow from ordinary activities:
Periodengewinn vor Steuern- und Minderheitenanteilen		2,774	965	Net profit for the period before taxes and minority interests
Berichtigungen:				Adjustments:
+/- Abschreibungen auf Sachanlagen und immaterielle				+/- Depreciation of property, plant and
Vermögensgegenstände		2,046	1,331	equipment, and amortisation of intangible assets
+/- Veränderungen der langfristigen Rückstellungen		-974	2	+/- Changes in long-term accruals
+/- Veränderungen der kurzfristigen Rückstellungen		-1,721	70	+/- Changes in current accruals
+/- Ergebnis aus dem Abgang von Anlagevermögen		-5	-26	+/- Profit/ losses on the disposal of fixed assets
+/- Zinsaufwand		863	611	+/- Interest expense
+/- Veränderungen der Vorräte		-5,557	-2,006	+/- Changes in inventories
+/- Veränderungen der Forderungen aus Lieferungen				+/- Changes in trade accounts receivable
und Leistungen sowie anderer Forderungen		-1,638	3,288	and other accounts receivables
+/- Veränderungen der Verbindlichkeiten aus Lieferungen				+/- Changes in trade accounts payables
und Leistungen sowie anderer Schulden		-8,336	-13,734	and other accounts payable
+/- Gezahlte Zinsen		-220	-157	+/- Interest paid
+/- Gezahlte und erstattete Ertragsteuern		-69	-123	+/- Income tax payments and rebates
+/- Zahlungsunwirksame Aufwendungen und Erträge		-584	0	+/- Non-cash expenses and income
+/- Einzahlungen / Auszahlungen aufgegebene Geschäftsbereiche		0	0	+/- Cash inflow / outflow from discontinued operations
Nettozahlungsmittel aus betrieblicher Tätigkeit		-11,473	-9,779	Net cash from operating activities
Cashflow aus Investitionstätigkeit				Cash flow from investing activities
+/- Erwerb von Tochterunternehmen		-5,477	551	+/- Acquisition of subsidiaries
+/- Beim Kauf von Anteilen erworbene Zahlungsmittel		-724	0	+/- Cash from acquisitions
+/- Zahlungen für Zugänge zu immateriellen				+/- Payments for additions to intangible assets as
Vermögenswerten sowie Sachanlagen		-4,506	-1,079	well as property, plant and equipment
+/- Zahlungen für Zugänge und Abgänge				+/- Payments for additions to and disposal
zu anderen Finanzanlagen		68	0	of financial assets
+/- Erlöse aus dem Abgang von Sachanlagen				+/- Proceeds from disposal of property, plant and
und Finanzanlagen		45	1	equipment as well as financial assets
- Beim Verkauf von Anteilen hingegebene Zahlungsmittel		0	0	- Cash used in disposal of equity holdings
+/- Erhaltene Zinsen		73	99	+/- Interest received
+/- Einzahlungen / Auszahlungen aufgegebene Geschäftsbereiche		0	0	+/- Cash inflow / outflow from discontinued operations
Für Investitionstätigkeit eingesetzte Nettozahlungsmittel		-10,521	-428	Net cash used in investing activities
Cashflow aus Finanzierungstätigkeit				Cash flow from financing activities
+/- Ein/Auszahlungen für aufgenommene Kredite		3,823	-1,240	+/- Inflows/ outflows from borrowings
+/- Gezahlte Zinsen		-716	-553	+/- Interest paid
+/- Gezahlte Dividenden		-1,547		+/- Dividends payed
+/- Erwerb eigener Anteile	B.8.	-94	0	+/- Purchases of own shares
+/- Ein- / Auszahlungen aus Finanzierungs-Leasingverträgen		-97	807	+/- Cash inflow/outflow finance lease
+/- Einzahlungen / Auszahlungen aufgegebene Geschäftsbereiche		50	53	+/– Cash inflow/ outflow from discontinued operations
Für Finanzierungstätigkeit eingesetzte Nettozahlungsmittel		1,419	-933	Net cash used in financing activities
Nettozu-/abnahme von Zahlungsmitt. u. Zahlungmittelaquivalente		-20,575	-11,140	Net change in cash and cash equivalents
+/- Wechelkursbedingte Wertänderungen		10	74	+/- Changes in value resulting from foreign currency exchange
+/- Finanzmittelbestand am Anfang der Periode		25,836	18,877	+/- Cash and cash equivalents as at beginning of period
Finanzmittelbestand am Ende der Periode		5,271	7,811	Cash and cash equivalent sat end of period
Zusammensetzung:				Breakdown:
Liquide Mittel		5,271	7,811	Cash
Liquide Mittel aus aufgegebene Geschäftsbereiche			0	Cash from discontinued operations
		5,271	7,811

Consolidated statement of changes in equity (IFRS)

	Aktien / Shares	Gezeichnetes Kapital / Share capital	Kapitalrücklagen / Additional paid-in capital	Gewinnrücklagen / Retained earnings	Foreign currency translation reserve Rücklage Währungsumrechnung /	Neubewertungsrücklage / Revaluation reserve	Bilanzgewinn / Net profit loss	Summe Eigenkapitalgeber Mutterunternehmen / Total investors parent company	Minderheitenanteile / Minority interest	Eigenkapital gesamt / Total equity cash
31. Dezember 2008	units '000 10,391	in €'000 10,391	in €'000 15,441	in €'000 122	in €'000 -324	in €'000 -153	in €'000 13,447	in €'000 38,924	in €'000 -8	in €'000 38,916
Erwerb eigene Anteile								-165		-165	31 December 2008
Gesamtergebnis der Periode					45		5,060	5,105	39	5,144	Purchase of own shares Comprehensive income for the period
Effekt aus Abgang Minderheiten								0	-26	-26	Impact of derecognition of minority interests
31. Dezember 2009	10,391	10,391	15,441	122	-279	-153	18,507	43,864	5	43,869	31 December 2009
	Umbuchung Bilanzgewinn/Gewinnrücklage			10,483			-10,483	0		0	Transfer netprofit/retained earnings
Erwerb eigene Anteile								-94		-94	Purchase of own shares
Ausschüttung im Geschäftsjahr							-1,547	-1,547		-1,547	Distribution
Gesamtergebnis der Periode					21		2,072	2,093	14	2,107	Comprehensive income for the period
Erwerb Minderheitenanteile								0	159	159	Purchase of minority interests
Effekt aus Abgang Minderheiten								0	-159	-158	Impact of derecognition of minority interests
30. Juni 2010	10,391	10,391	15,441	10,605	-258	-153	8,549	44,316	20	44,336	31 March 2010

Statement of comprehensive income (IFRS)

(in €'000)	04/01/2010 -06/30/2010	04/01/2009 -06/30/2009	01/01/2010 -06/30/2010	01/01/2009 -06/30/2009
Periodenergebnis	700	402	2,086	885	Net income for the period
Übriges Ergebnis					Other income
Unerschied aus Währungsumrechnung	40	75	31	107	Currency translation difference
Ertragsteuern auf übriges Gesamtergebnis	-13	-22	-10	-32	Income tax expense on other compehensive income
Übriges Ergebnis der Periode (nach Steuern)	27	53	21	75	Other after-tax income for the period
Gesamtergebnis der Periode	727	455	2,107	960	Comprehensive income for the period
davon entfallen auf Gesellschafter desMutterunternehmens	717	475	2,093	990	thereof attributable to the shareholder of the parent
davon entfallen auf Minderheiten	10	-20	14	-30	thereof attributable to the minority interests

Segment information (IFRS)

	e-commerce/trade			IT Solutions
	06/30/10	06/30/09	06/30/10	06/30/09
	€'000	€'000	€'000	€'000
Sales revenues
– External sales	108,453	105,548	130,723	99,000
– Intersegment sales	4,299	990	12,657	9,158
– Total sales revenues	112,752	106,538	143,380	108,158
– Cost of purchased materials and services	-95,728	-91,225	-87,687	-65,630
– Personnel expenses	-8,956	-9,082	-39,420	-30,436
– Other operative income and expenses	-4,975	-4,231	-10,831	-8,917
EBITDA	3,093	2,000	5,442	3,175
– calculated depreciation and amortisation	865	740	1,097	531
Operating income (EBIT)	2,228	1,260	4,345	2,644
– Interest income	28	52	63	89
– Interest expenditure	-309	-184	-250	-92
– Write-downs of financial assets
– Share in profit or loss of joint ventures accounted for by the equity
Result from ordinary activities	1,947	1,128	4,158	2,641
– Result from extraordinary activities	0	0	0	0
– Foreign currency exchange gains / losses
Pre-tax profit	1,947	1,128	4,158	2,641
– Income taxes
– discontinued operations		0
Consolidated income for the year
thereof attributable to the shareholders
of the parent
thereof attributable to minority interest
Other information
– Assets 1)	62,888	49,147	66,365	50,083
– Investments 1)	903	781	6,803	342

1) Segment assets and investments including goodwill from consolidation of capital 2) Tax assets

Segment information (IFRS)

	konsolidiert		Überleitungsrechnung		sonstige Gesellschaften		Summe Geschäftssegmente
06/30/09	06/30/10	06/30/09	06/30/10	06/30/09	06/30/10	06/30/09	06/30/10
€'000	€'000	€'000	€'000	€'000	€'000	€'000	€'000
				0	0	204,548	239,176
		-13,427	-19,862	3,279	2,906	10,148	16,956
204,548	239,176	-13,427	-19,862	3,279	2,906	214,696	256,132
-149,145	-169,786	7,710	13,629	0	0	-156,855	-183,415
-40,862	-50,149	0	0	-1,334	-1,773	-39,518	-48,376
-11,644	-13,539	5,717	6,233	-4,213	-3,966	-13,148	-15,806
2,897	5,702	0	0	-2,278	-2,833	5,175	8,535
1,331	2,046	0	0	60	84	1,271	1,962
1,566	3,656	0	0	-2,338	-2,917	3,904	6,573
99	73	-154	-318	112	300	141	91
-710	-936	154	318	-588	-695	-276	-559
0	0	0	0	0		0	0
0	0	0	0	0	0	0	0
955	2,794	0	1	-2,814	-3,312	3,769	6,105
0	0	0	0			0	0
10	-20	10	-20	0		0	0
965	2,774	10	-19	-2,814	-3,312	3,769	6,105
-80	-688	-80	-688
0	0	0	0	0	0	0	0
885	2,086
915	2,072
-30	40
			Überleitung 2)
					4,060	99,230	129,253
107,705 1,131	136,093 11,030	2,914	2,780	5,561 8	3,324	1,123	7,706

NOTES

to the consolidated accounts for the quarter ended 30 June 2010

A. The principles adopted for the consolidated financial statements

1. General information

The consolidated financial statements of CANCOM IT Systeme Aktiengesellschaft and its subsidiaries ("the CANCOM Group" or "the Group") for the financial year 2009 were drawn up according to the International Financial Reporting Standards or the International Accounting Standards (IFRS/IAS).

The interim consolidated financial statements of the CANCOM Group are drawn up and published in euro.

This interim consolidated financial report is condensed and was drawn up in compliance with IAS 34 Interim Financial Reporting. It should be read in conjunction with the IFRScompliant consolidated financial statements for the financial year 2009, which can be downloaded from www.cancom.de.

2. Reporting entity – scope of consolidation

The consolidated financial statements include CANCOM IT Systeme Aktiengesellschaft and all subsidiaries in which CANCOM IT Systeme Aktiengesellschaft has either a direct or an indirect majority shareholding, or in which it holds the majority of the voting rights. These subsidiaries are fully consolidated.

In December 2009, CANCOM IT Systeme Aktiengesellschaft purchased all the shares of CANCOM Bürotex GmbH (formerly BT IT-Systemhaus GmbH), nominally valued at € 120,000. The acquisition is documented by a contract of sale drawn up by notary Dr Thomas Braun under deed no. B1937/2009, dated 21/22 December 2009.

The provisional price is € 3,541,852, of which € 2,500,000 was paid on 5 January 2010. The price is still subject to change.

The company is included in the consolidated financial statements from 1 January 2010.

The company sells and distributes computer, telecommunications, IT and document management systems, as well as providing related services including consultancy, maintenance, repairs, support and project management.

The company has shares in BT IT-Solutions GmbH, Nürtingen, Germany (100 percent) and live Netzwerk & Computer GmbH, Munich, Germany (75.0 percent).

Change in the reporting entity in 2010:

Name and registered office of company	Date of first consolidation	Equity	Share of investment % voting rights %
CANCOM Bürotex GmbH, Nürtingen and its subsidiaries	01/01/10	100.0	100.0
• CANCOM Bürotex IT solutions GmbH, Nürtingen	01/01/10	100.0	100.0
• live Netzwerk & Computer GmbH, Munich	01/01/10	75.0	75.0

The change in the reporting entity had the following effects on the consolidated financial statements at the date on which CANCOM Bürotex GmbH was first included, on 1 January 2010:

		Fair values Carrying amount
	€'000	€'000
Cash and cash equivalents	776	776
Trade accounts receivable	3,667	3,667
Other current financial assets	571	571
Group accounts receivable	1,255	1,255
Inventories	760	760
Prepaid expenses, deferred charges
and other current assets	714	714
Current Assets	7,743	7,743
Property, plant and equipment	493	493
Intangible assets	2,521	42
Financial Assets	8	8
Deferred taxes from temporary differences	0	0
Deferred taxes from tax loss carryover	0	0
Other assets	100	100
Non-current assets	3,122	543
Total assets	10,865	8,286
Short-term loans and current component
of long-term loans	34	34
Trade accounts payable	2,865	2,865
Other current financial liabilities	262	262
Accrued expensed	107	107
Deferred revenues	136	136
Taxes on income	102	102
Other current liabilities	603	603
Current liabilities	4,109	4,109
Long-term debt	1,500	1,500
Deferred taxes from temporary differences	739	0
Other long-term liabilities	280	280
Non-current liabilities	2,519	1,780
Total liabilities	6,628	5,889
Net assets acquired	4,237	2,397

The company acquisition, and the newly valued assets acquired and liabilities assumed resulted in a negative difference of € 536k as well as intangible assets of € 2,479k. The negative difference was recognised in the income statement and shown under other operating income.

CANCOM SYSDAT GmbH has been merged into CANCOM IT Solutions GmbH. The merger is documented in a merger agreement drawn up on 11 February 2010 by notary Dr Braun under deed no. B178/2010 and was entered in the commercial register file of CANCOM IT Solutions GmbH on 22 July 2010.

CANCOM IT Systeme Aktiengesellschaft has sold its interest in CANCOM NSG SCS GmbH (formerly CANCOM Service Center Süd GmbH) to CANCOM NSG GmbH with immediate effect under a share purchase and transfer agreement drawn up by notary Dr Braun on 7 May 2010 (deed no. B640/2010) for the nominal sum of € 25,000. The purchase price amounted to € 75,605 and was paid on 10 May 2010.

CANCOM physical infrastructure GmbH has sold its interest in CANCOM NSG GIS GmbH (formerly Novodrom People Value Service GmbH) to CANCOM NSG GmbH for the nominal sum of € 25,000 with effect from midnight on 31 December 2010. The transaction is documented in a share purchase and transfer agreement drawn up by notary Dr Braun on 7 May 2010 under deed no. B643/2010. The purchase price of € 328,318 was paid on 10 May 2010.

CANCOM IT Systeme Aktiengesellschaft has sold its interest in CANCOM NSG ICP GmbH (formerly NSG Datacenter Services GmbH) to CANCOM NSG GmbH with immediate effect for the nominal sum of € 25,000. The transaction is documented by a share purchase and transfer agreement drawn up by notary Dr Braun on 7 May 2010 under deed no. B645/2010. The purchase price of € 24,494.49 was paid on 10 May 2010.

CANCOM Bürotex GmbH has acquired the remaining shares in live Netzwerk & Computer GmbH for the nominal sum of € 37,500. The acquisition is documented by a share purchase and transfer agreement drawn up by notary Dr Braun on 7 May 2010 under deed no. B656/2010. The purchase price of € 110,000 was paid on 17 May 2010.

live Netzwerk & Computer GmbH has been merged into CANCOM Bürotex GmbH. The merger is documented by a merger agreement drawn up by notary Dr Braun on 7 May 2010 under deed no. B658/2010 and was entered in the commercial register file of CANCOM Bürotex GmbH on 8 July 2010.

CANCOM Bürotex IT solutions GmbH has been merged into CANCOM Bürotex GmbH. The merger is documented by a merger agreement drawn up by notary Dr Braun on 7 May 2010 under deed no. B663/2010 and was entered in the commercial register file of CANCOM Bürotex GmbH on 8 July 2010.

Under a merger agreement drawn up by notary Dr Braun on 27 July 2010 CANCOM Bürotex GmbH was merged into CANCOM SCC GmbH. The transaction is expected to be entered in the commercial register file of CANCOM SCC GmbH in mid-August 2010.

	Company' registered office	Shareholding quote in %
1. CANCOM Deutschland GmbH	Jettingen-Scheppach, Germany 100.0
and its subsidiaries
• CANCOM (Switzerland AG)	Caslano, Switzerland	100.0
• CANCOM Computersysteme GmbH and its subsidiary	Grambach, Austria	100.0
– CANCOM a + d IT solutions GmbH	Perchtoldsdorf, Austria	100.0
2. CANCOM NSG GmbH	Jettingen-Scheppach, Germany 100.0
• CANCOM NSG SCS GmbH	Jettingen-Scheppach, Germany 100.0
• CANCOM NSG ICP GmbH	Jettingen-Scheppach, Germany 100.0
3. CANCOM IT Solutions GmbH	Jettingen-Scheppach, Germany 100.0
and its subsidiary
• acentrix GmbH	Jettingen-Scheppach, Germany	51.0
4. HOH Home of Hardware GmbH	Jettingen-Scheppach, Germany 100.0
5. CANCOM SCC GmbH	Stuttgart, Germany	100.0
6. CANCOM physical infrastructure GmbH	Jettingen-Scheppach, Germany 100.0
and its subsidiary
• Novodrom People Value Service GmbH	Jettingen-Scheppach, Germany 100.0
7. CANCOM Ltd.	Guildford, UK	100.0
8. CANCOM Financial Services GmbH	Jettingen-Scheppach, Germany 100.0
9. CANCOM IT Services GmbH	Jettingen-Scheppach, Germany 100.0

3. Accounting and valuation policies

The interim consolidated financial report is compiled using basically the same accounting and valuation methods as those used for the consolidated financial statements for the financial year 2009.

However, the amendment to IFRS 3 Business Combinations was not applicable in the financial year 2009, so this interim report is the first in which it is applied. The acquisition method is applied in accounting for all business combinations. Identifiable assets acquired and liabilities assumed are measured and shown in the balance sheet at their acquisitiondate fair values. Incidental costs in relation to the acquisition are recorded as expenses at the date on which they were incurred.

B. Notes to the consolidated balance sheet

1. Other current financial assets

This item includes bonuses due from suppliers (€ 1,296k), claims in respect of loans (€ 512k), creditors with a debit balance (€ 447k), a claim to the payment of a purchase price (€ 419k), receivables from employees (€ 303k), marketing revenue (€ 168k), receivables due from suppliers for returned goods (€ 112k), property, plant and equipment classified as held for sale (€ 55k) and receivables from former shareholders (€ 47k).

2. Prepaid expenses, deferred charges and other current assets

This item mainly consists of other current assets such as tax refunds (€ 570k), compensation damages (€ 300k), receivables from the German Federal Employment Agency (€ 113k) and accounts receivable from insurance companies (€ 108k).

The prepaid expenses and deferred charges (€ 1,050k) also include deferred insurance premiums.

3. Financial assets accounted for using the equity method

In the first half of 2010, CANCOM IT Systeme Aktiengesellschaft acquired shares in Plaut Aktiengesellschaft. As at 30 June 2010, CANCOM held a 20.507 percent interest. The investment in Plaut Aktiengesellschaft is reported as an associated company under financial assets accounted for using the equity method, as CANCOM IT Systeme Aktiengesellschaft holds more than 20 percent of the voting rights and therefore exercises a significant influence on Plaut Aktiengesellschaft.

4. Deferred tax assets

The deferred tax assets are as follows:

Deferred tax resulting from	Temporary	Tax loss
	differences	carryforward
	€'000	€'000
As at 1 January 2010	338	2,224
Inflow from capitalisation		101
Tax expenditure from profit and loss calculation	-26	-349
As at 30 June 2010	312	1,976

As at 3 June 2010, the CANCOM Group had corporation tax loss carryovers of € 13.8 million and trade tax loss carryovers of € 10.5 million. The unused corporation tax losses for which no deferred tax claim was recognised in the balance sheet amounted to € 6.2 million, and the trade tax loss carryovers for which no deferred tax claim was recognised amounted to € 5.6 million.

The deferred taxes from temporary differences are the result of differences in goodwill (€ 199k), other provisions (€ 92k) and intangible assets (€ 21k).

5. Other current financial liabilities

This item includes outstanding bills of charge (€ 524k), debtors with a credit balance (€ 476k), purchase price liabilities (€ 423k), and liabilities to former shareholders of a subsidiary (€ 422k).

6. Other provisions

Provisions mainly includes the price of shares in affiliated companies (€ 1,565k), guarantees and warranties (€ 1,172k), severance payments and salaries (€ 817k), additional leasing costs (€ 313k), provisions for financial statement costs (€149k) and contingent risks (€ 125k).

The total provisions include long-term provisions of € 1,230k, which are disclosed under other non-current liabilities. They are mainly a provision for guarantees and warranties (€ 506k), a provision for severance payments which are legally mandatory in Austria (€ 347k), anniversaries (€ 141k), additional leasing costs (€ 145k) and provisions for part-time employment prior to retirement (€ 71k).

7. Other current liabilities

Other current liabilities mainly include wages and salaries (€ 3.415k), sales tax (€ 3.078k), holiday and overtime entitlements (€ 2.093k), bonus payments to Board members and employees (€ 1.961k), tax on wages and salaries and church tax (€ 1,711k), trade association payments (€ 289k), social security contributions (€ 152k) and compensation levy for non-employment of the severely handicapped (€ 85k).

8. Deferred tax liabilities

The deferred tax liabilities are as follows:

	€'000
As at 1 January 2010	1,967
Addition from deferred tax liabilities	739
Profit and loss account - tax expenses	-70
As at 30 June 2010	2,636

The deferred tax liabilities arise from deviations from the tax balance sheets. They are the result of the revaluation of intangible assets (€ 2,576k), orders in process (€ 27k), capital from profit-participation rights and subordinated loans (€ 20k), property, plant and equipment (€ 6k) and other provisions (€ 7k).

They are recognised at an individual tax rate of between 25 percent (for the Austrian subsidiary) and 32.98 percent.

9. Equity capital

Share capital

The Company's share capital at 30 June 2010 was € 10,390,751, divided into 10,390,751 notional no-par-value shares.

Purchase of the Company's own shares

The Company bought back 23,010 of its own shares during the first half of 2010. As at 30 June 2010, the Company's holding of its own shares was 74,329 (nominally valued at € 74,329) with a book value of € 258,936.31.

Change of the number of shares outstanding:

	Number of shares
Number of shares outstanding as at 31 December 2009	10,339,432
less purchased own shares in the first half 2010	-23,010
Number of shares outstanding as at 30 June 2010	10,316,422

As of 6 August 2010, no further CANCOM shares had been repurchased in the third quarter of 2010.

C. Notes to the consolidated income statement

1. Segment information (see page 16 – 17)

For a description of the segments subject to mandatory reporting, please see page 69 of CANCOM's annual report for 2009.

The subsidiaries included in the consolidated financial statements for the first time in this consolidated interim financial report are allocated to the IT solutions segment.

Reconciliation

Reconciliation shows items not directly connected with the operating segments and the other companies. They include sales within the segments, and the income tax expense.

The income tax expense is not a component of the profits of the operating segments. Since the tax expense is allocated to the parent company where the parent company is the taxable entity, the allocation of the income tax does not exactly correspond to the structure of the segments.

Information on geographical regions

	Sales revenues according to customer location			Sales revenues according to company location
	06/30/2010	06/30/2009	06/30/2010	06/30/2009
	€'000	€'000	€'000	€'000
Germany	216,324	184,208	219,945	187,429
Outside Germany	22,852	20,340	19,231	17,119
Group	239,176	204,548	239,176	204,548

	Long-term assets
	06/30/2010	06/30/2009
	€'000	€'000
Germany	40,830	31,577
Outside Germany	3,637	4,108
Group	44,467	35,685

Non-current assets includes property, plant and equipment, intangible assets, goodwill and other non-current assets. Financial instruments and deferred tax claims are not included.

2. Other operating income

The other operating income is made up of the following:

€'000	01/01/ - 06/30/2010	01/01/ - 06/30/2009
Rent Earnings from differences from	36	88
consolidation of capital	584	0
Income not relating to the period	496	649
other operating income	329	38
Total	1,445	775

Income not relating to the period mainly includes income from derecognition of debtors with a credit balance and overpayment of sales tax in previous years.

3. Personnel expenses

The personnel expenses consist of the following:

Total	50,149	40,862
Pension Expenses	157	73
Social security contribution	7,745	6,267
Wages and salaries	42,247	34,522
€'000	01/01/ - 06/30/2010	01/01/ - 06/30/2009

4. Other operating expenses

The other operating expenses consist of the following:

€'000	01/01/ - 06/30/2010	01/01/ - 06/30/2009
Office space	3,017	2,552
Insurance and other charges	569	524
Motor vehicles	2,779	2,071
Advertising	1,147	967
Stock exchange and entertainment expenses	313	110
Hospitality and travelling expenses	1,065	831
Delivery costs	1,630	1,351
Third-party services	1,286	1,190
Repairs, maintanance, leasing	673	779
Communication and office expenses	942	818
Legal and consultancy expenses	653	253
Fees and charges, costs of money transactions	310	241
Allowance for bad debts	1	64
Other oerating expenses	799	668
Total	15,184	12,419

5. Income tax

The rate of income tax for German companies was 31.53 percent (2009: 29.89 percent). This is made up of corporation tax, trade tax and the solidarity surcharge. The slight rise in the income tax rate is owing to the increase in the average rate of trade tax. The divergence between the tax expenses reported and those at the tax rate of CANCOM IT Systeme Aktiengesellschaft is shown below:

€'000	01/01/ - 06/30/2010	01/01/ - 06/30/2009
Earnings before tax	2,760	995
Expected tax rate at
to German companies
(31.53 percent; 2009: 29.89 percent)	870	297
- Difference from tax paid abroad	-59	31
- Change in the value adjustment
of deferred tex assets on loss carryforwards	-68	-60
- Tax free income	0	-198
- Actual income tax not relating to the period	18	-83
- permanent differences: non-deductible
operating expenses and additions and
reductions due to trade tax	120	91
- Earnings from differences from
consolidation of capital	-184	0
- Others	-9	2
Total Group income tax	688	80

The actual tax rate is calculated as follows:

Actual tax expense rate	24.93 %
Income tax	688
Income before tax	2,760
	€'000

Income tax comprises the income tax paid or owed in the individual countries and also the deferred taxes:

€'000	01/01/ - 06/30/2010	01/01/ - 06/30/2009
Actual income tax paid	384	86
deferred taxes:
Assets	375	23
Liabilitis	-71	-29
	304	-6
Group income tax	688	80

6. Minority interests

Minority interests account for 49 percent of acentrix GmbH's net income for the year (€ 15k) and 25 percent of live Netzwerk & Computer GmbH's net loss for the period 1 January till 6 May 2010 (€ 1k).

D. Other disclosures

1. Related party disclosures

For the purposes of IAS 24, Klaus Weinmann can be considered a related party who can exercise a significant influence on the CANCOM Group, both as an Executive Board member and as a shareholder in CANCOM IT Systeme Aktiengesellschaft. Rudolf Hotter and Paul Holdschik, the other Executive Board members, are also related parties for the purposes of IAS 24, as are the members of the Supervisory Board.

There were no receivables or payables in relation to the Executive Board or the other companies in the CANCOM Group at the balance sheet date.

Since 1 July 2007, a consultancy agreement has been in place between CANCOM IT Systeme Aktiengesellschaft and the Chairperson of its Supervisory Board, Walter von Szczytnicki. The contract was drawn up on 9 March 2007 and approved in accordance with Section 114 of the German Stock Companies Act (Aktiengesetz, AktG), and provides for an annual remuneration of € 60,000. Hence the remuneration paid in the financial year 2009 amounted to € 60,000.

On 27 June 2007 the Supervisory Board approved an M&A consultancy agreement with Auriga Corporate Finance GmbH, Munich, Germany on the occasion of the election to the Supervisory Board of CANCOM IT Systeme AG of Walter Krejci, managing director of Auriga Corporate Finance GmbH. The agreement had been signed on 7 March 2007 and required the approval of the Supervisory Board in accordance with Section 114 I of the German Stock Companies Act (Aktiengesetz, AktG). No payments were made to the company on the basis of the consultancy agreement in the first half of the year 2010.

Transactions with related parties were settled in the same way as arm's length transactions.

2. Shares held by members of the Executive and Supervisory Boards (at the balance sheet date)

Please see page 8 of this report for a list of shareholdings.

3. Equity interests in the Company as defined in Section 20 IV of the German Stock Companies Act (Aktiengesetz, AktG)

In the first half of 2010 CANCOM IT Systeme Aktiengesellschaft received no written notice from any shareholder disclosing a majority shareholding as defined in Section 20 of the above Act.

6-month-report 2010

Masthead

CANCOM IT Systeme AG Investor Relations

Messerschmittstr. 20 89343 Jettingen-Scheppach

Germany