CENIT AG

Quarterly Report • Nov 4, 2020

9 MONTHS REPORT 2020

14

GERMANY
STUTTGART
BERLIN
FRANKFURT
HAMBURG
HANOVER
MANNHEIM
MUNICH
OELSNITZ
RATINGEN
RATINGEN
SAARRRIIFT SAARBRUECKEN

CENIT Aktiengesellschaft, Stuttgart
At a glance – January 1 until September	30, 2020
in EUR k	September 30th, 2020	September 30th, 2019
Sales	109,710	126,156
Gross profits	53,977	63,119
EBITDA	6,049	8,901
Operating returns (EBIT)	1,672	4,546
EBT	1,545	4,443
Net income of the group	928	3,089
Earnings per share (basic) in EUR	0.11	0.36
Earnings per share (diluted) in EUR	0.11	0.36
Number of employees at end of period	711	734
EBIT‐Margin	1.5%	3.6%
Profit‐Margin	0.8%	2.4%
in EUR k	September 30th, 2020	December 31st, 2019
Equity in ratio	50.2%	45.8%
Equity	41,400	40,940
Liabilities	41,061	48,408
Balance sheet total	82,461	89,348

OVERVIEW OF 9 MONTHS FIGURES

During the first nine months, CENIT group generated sales of EUR k 109,710 (prior year: EUR k 126,156/‐13.0%). EBITDA amounted to EUR k 6,049 (prior year: EUR k 8,901/‐32.0%) at EBIT of EUR k 1,672 (prior year: EUR k 4,546/‐63.2%). Earnings per share were EUR 0.11 (prior year: EUR 0.36).

BREAKDOWN OF EARNINGS

In the PLM segment, CENIT achieved earnings of EUR k 99,601 (prior year: EUR k 114,845/‐13.3%) in the first nine months. The EIM segment attained a sales total of EUR k 10,109 against EUR k 11,311 during the same period of 2019 (‐10.6%). Sales of third‐party software totaled EUR k 69,227 (prior year: EUR k 78,231/‐11.5%), while sales of CENIT's proprietary software decreased from EUR k 11,364 to EUR k 11,053/‐2.7%. Salesin the service and consulting segment amounted to EUR k 29,127 (prior year: EUR k 36,474/‐20.1%). Other sales totaled EUR k 303 (prior year: EUR k 88/> 100.0%).

COST DEVELOPMENT

Other expenses totaled EUR k 6,603 (prior year: EUR k 8,698).

INVESTMENTS

Investments expenditures in the first nine months 2020 amounted to EUR k 736 (prior year: EUR k 900).

CHANGES IN MANAGING AND SUPERVISORY BODIES

Dr. Markus Wesel was appointed to the Management Board as from July 1, 2020. Dr. Markus Wesel will successively take over the tasks of Matthias Schmidt as CFO in the coming months.

EVENTS OF SPECIAL SIGNIFICANCE WHICH MAY AFECT THE RESULT OF BUSINESS ACTIVITY

COVID 19 pandemic, see supplementary, opportunities and forecast reports.

INTERIM DIVIDEND

No interim dividend has been disbursed.

DIVIDENDS PAID OR PROPOSED FOR PAYMENT

The Management Board and the Supervisory Board of CENIT AG had proposed to the Annual General Meeting on July 2, 2020 that no dividend should be distributed to shareholders for the 2019 business year due to the economic crisis caused by the COVID 19 pandemic. This proposal was approved at the Annual General Meeting.

ORDERS SITUATION

The group‐wide order intake totaled EUR k 105.195 (prior year: EUR k 124,939/‐15.8%). Ordersin hand as at September 30th, 2020 amounted to EUR k 42,708 (prior year: EUR k 52,172/‐18.1%).

ORDERS OF SPECIAL SIGNIFICANCE

None.

LIQUID ASSETS AND SECURITIES

On the balance‐sheet date, bank deposits totaled EUR k 27,234 (31 Dec. 2019: EUR k 18,461).

ASSET, FINANCIAL AND EARNINGS SITUATION

The balance‐sheet total is EUR k 82,461. Trade receivables totaled EUR k 11,594. On the balance‐sheet date, equity capital amounted to approx. EUR k 41,400 (31 Dec. 2019: EUR k 40,940) at an equity ratio of 50.2% (31 Dec. 2019: 45.8%). Operative cash flow totaled EUR k 12,320 (prior year: EUR k 12,540).

EMPLOYEES

On 30 September 2020, CENIT employed staff group‐wide 711 (prior year: 734).

SUPPLEMENTARY, OPPORTUNITIES AND FORECAST REPORTS

The global economic environment continues to be characterized by great uncertainties due to the corona virus pandemic, especially in our main sectors of automotive, aerospace and mechanical engineering. It therefore remains difficult to predict the negative effects.

Based on the results so far and the current business development, we expect sales in the range of EUR k 145,000 to EUR k 150,000 and EBIT of EUR k 1,500 to EUR k 2,000.

CENIT Aktiengesellschaft, Stuttgart CONSOLIDATED BALANCE SHEET (in accordance with IFRSs) (unaudited)
in EUR k	September 30th, 2020	December 31st, 2019
ASSETS
NON‐CURRENT ASSETS
Intangible assets	11,396	12,223
Property, plant and equipment	13,647	16,476
Investment in Joint Venture	60	60
Other financial assets	2,500	2,615
Deferred tax assets	1,191	1,224
NON‐CURRENT ASSETS	28,794	32,598
CURRENT ASSETS
Inventories	22	258
Trade receivables	11,594	20,395
Receivables from investments recognized at equity	2,455	4,413
Contract assets	3,319	3,727
Current tax assets	1,169	1,514
Other receivables	620	408
Cash and cash equivalents	27,234	18,461
Prepaid expenses	7,254	7,574
CURRENT ASSETS	53,667	56,750
TOTAL ASSETS	82,461	89,348

CENIT Aktiengesellschaft, Stuttgart CONSOLIDATED BALANCE SHEET (in accordance with IFRSs) (unaudited)
in EUR k	September 30th, 2020	December 31st, 2019
EQUITY AND LIABILITIES
EQUITY Issued capital	8,368	8,368
Capital reserve	1,058	1,058
Currency translation reserve	1,004	1,058
Statutory earnings reserve	418	418
Other earnings reserves	13,770	13,771
Profit carried forward	15,161	8,289
Net profit	956	6,872
Equity attributable to shareholders of CENIT AG	40,735	39,834
Non‐controlling interests	665	1,106
TOTAL EQUITY	41,400	40,940
NON‐CURRENT LIABILITIES Other liabilities	561	834
Pension obligation	1,565	1,480
Non‐current lease liability	9,132	11,027
Deferred tax liabilities	31	142
NON‐CURRENT LIABILITIES	11,289	13,483
CURRENT LIABILITIES
Trade liabilities	2,910	5,964
Liabilities to investments recognized at equity	200	34
Other liabilities	6,733	10,959
Current lease liability	2,624	3,102
Current income tax liabilities	464	309
Other provisions	153	132
Contract liabilities	16,688	14,425
CURRENT LIABILITIES	29,772	34,925
TOTAL EQUITY AND LIABILITIES 6	82,461	89,348

CENIT Aktiengesellschaft, Stuttgart CONSOLIDATED BALANCE SHEET (in accordance with IFRSs) (unaudited)
in EUR k		1st Jan – 30th Sept 2020	1st Jan – 30th Sept 2019
1. REVENUE		109,710	126,156
2. Increase/decrease in work of process		0	0
Total operating performance		109,710	126,156
3. Other income		966	859
Operating performance		110,676	127,015
4. Cost of materials	56,699		63,896
5. Personnel expenses	41,325		45,520
6. Amortization and depreciation of intangible assets and property, plant and equipment	4,377		4,355
7. Other expenses	6,603		8,698
		109,004	122,469
OPERATING RESULT (EBIT)		1,672	4,546
8. Other interest and similar income	0		0
9. Other interest and similar expenses	127		103
		‐127	‐103
RESULT BEFORE INCOME TAX (EBT)		1,545	4,443
10. Income taxes		617	1,354
NET INCOME OF THE GROUP FOR THE YEAR		928	3,089
thereof attributable to the shareholders of CENIT AG		956	3,044
thereof attributable to non‐controlling interests		‐28	45
Earnings per share in EUR
basic		0.11	0.36
diluted		0.11	0.36

CENIT Aktiengesellschaft, Stuttgart CONSOLIDATED BALANCE SHEET (in accordance with IFRSs) (unaudited)
in EUR k		3nd Quarter 2020	3nd Quarter 2019
1. REVENUE		35,021	41,661
2. Increase/decrease in work of process		0	0
Total operating performance		35,021	41,661
3. Other income		266	314
Operating performance		35,287	41,975
4. Cost of materials	18,188		20,933
5. Personnel expenses	12,675		14,461
6. Amortization and depreciation of intangible assets and
property, plant and equipment	1,351		1,432
7. Other expenses	2,183	34,396	2,663 39,490
OPERATING RESULT (EBIT)		891	2,485
8. Other interest and similar income	0		0
9. Other interest and similar expenses	39		69
		‐39	‐69
RESULT BEFORE INCOME TAX (EBT)		852	2,416
10. Income taxes		236	724
NET INCOME OF THE GROUP FOR
THE YEAR thereof attributable to the shareholders of CENIT AG		616 646	1,692 1.685
thereof attributable to non‐ controlling interests		‐30	7
Earnings per share in EUR
basic		0.08	0.20
diluted		0.08	0.20

CENIT Aktiengesellschaft, Stuttgart CONSOLIDATED STATEMENT OF CASH FLOWS (in accordance with IFRS) (unaudited)

	1st Jan –	1st Jan –
in EUR k	30th Sept	30th Sept
	2020	2019
Cash flow from operating activities
Net income of the Group for the year	928	3,089
Adjusted for:
Amortization/depreciation of intangible assets and property, plant and equipment	4,377	4,355
Gains (‐) and losses (+) on disposals of assets	3	‐3
Finance cost	127	103
Tax expenses	617	1,354
Increase/decrease in other non‐current assets	0	0
Increase/decrease in other non‐current liabilities and long‐term provisions	401	‐559
Interest paid	‐127	‐103
Interest received	0	0
Income tax paid	‐43	‐2,477
Increase/decrease in trade receivables and other current non‐cash assets	10,998	8,463
Increase/decrease in inventories	236	16
Increase/decrease in current liabilities and provisions	‐5,197	‐1,698
Net cash flows from operating activities	12,320	12,540
Cash flow from investing activities
Cash paid for purchase of property, plant and equipment and intangible assets	‐736	‐900
Cash paid for purchase of shares in fully consolidated entities (net cash outflow)	‐103	‐137
Cash paid for investments	0	0
Cash received from the sale of property, plant and equipment	0	0
Net cash paid for investing activities	‐839	‐1,037
Cash flow from financing activities
Cash repayments of lease liability	‐2,481	‐2,517
Dividends paid to shareholders	0	‐5,021
Dividends paid to non‐controlling interests	‐196	‐196
Net cash paid for financing activities	‐2,677	‐7,734
Net increase/decrease in cash and cash equivalents	8,804	3,769
Change in cash and cash equivalents due to foreign exchange differences	‐31	78
Cash and cash equivalents at the beginning of the reporting period	18,461	18,038
Cash and cash equivalents at the end of the reporting period	27,234	21,885

CENIT Aktiengesellschaft, Stuttgart CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME (in accordance with IFRS) (unaudited)

In EUR k		1st Jan – 30th Sept 2020	1st Jan – 30th Sept 2019
Net income for the year		928	3,089
Other comprehensive income
Items that will be reclassified to the income statement in the future under certain circumstances
Currency translation reserve of foreign subsidiaries	‐54	‐54	92
Items that will not be reclassified to the income statement in the future
Actuarial gains/losses from defined benefit obligations and similar obligations	0		0
Deferred taxes recognised on other comprehensive income	0		0
Other comprehensive income after tax		‐54	92
Total comprehensive income		874	3,181
Thereof attributable to the shareholders of CENIT AG		902	3,136
Thereof attributable to non‐controlling interests		‐28	45

CENIT Aktiengesellschaft, STATEMENT OF CHANGES	Stuttgart IN	EQUITY (in	accordance	with IFRS)	(unaudited)
	Attributable to shareholders of CENIT AG
in EUR k	Sub‐	Capital	Currency	Revenue reserves		Profit	Net	Non‐	Total
	scribed capital	reserves	translation reserve	Legal reserve	Other reserves	carried forward	income	controlling interests
As of 1st January 2019	8,368	1,058	1,009	418	13,663	7,361	5,948	1,277	39,102
Net income prior year						5,948	-5,948	0	0
Total comprehensive income			49		180		6,872	90	7,191
Acquisition of minorities					‐72			‐64	‐136
Dividend distribution						‐5,021		‐196	‐5,217
As of 31st December 2019	8,368	1,058	1,058	418	13,771	8,289	6,872	1,106	40,940
Net income prior year						6,872	-6,872	0	0
Total comprehensive income			‐54		0		956	‐28	874
Acquisition of minorities					‐1			‐217	‐218
Dividend distribution								‐196	‐196
As of 30th September 2020	8,368	1,058	1,004	418	13,770	15,161	956	665	41,400

11

CENIT Aktiengesellschaft

Segment Reporting by Business Unit (in accordance with IFRSs) unaudited

				Recon
		EIM	PLM	ciliation	Group
in EUR k
External revenue	Q1-Q3 2020	10,109	99,601	0	109,710
	Q1-Q3 2019	11,311	114,845	0	126,156
EBIT	Q1-Q3 2020	1,013	659	0	1,672
	Q1-Q3 2019	993	3,553	0	4,546
Other interest result and	Q1-Q3 2020	0	0	-127	-127
financial result	Q1-Q3 2019	0	0	-103	-103
Income taxes	Q1-Q3 2020	0	0	617	617
	Q1-Q3 2019	0	0	1,354	1,354
Net income of the Group	Q1-Q3 2020	1,013	659	-744	928
	Q1-Q3 2019	1,514	2,285	-710	3,089
Segment assets	Q1-Q3 2020	3,857	49,010	29,594	82,461
	Q1-Q3 2019	4,857	60,573	22,578	88,008
Segment liabilities	Q1-Q3 2020	4,749	35,817	495	41,061
	Q1-Q3 2019	4,088	46,244	746	51,078
Investments in property, plant and Q1-Q3 2020		85	651	0	736
equipment and intangible assets	Q1-Q3 2019	98	802	0	900
Amortization and depreciation	Q1-Q3 2020	449	3,928	0	4,377
	Q1-Q3 2019	533	3,822	0	4,355

EIM = Enterprise Information Management; PLM = Product Lifecycle Management

CENIT Aktiengesellschaft

Group Segment Report by Region (in accordance with IFRSs) unaudited

in EUR k		Germany	Switzerland	North America	Romania	Frankreich	Belgium	Netherlands	Japan	Reconciliation	Consolidation	Group
External revenue	Q1-Q3 2020 61,284 7,637 5,108 1,416 28,709 2,844 1,738								974	0		0 109,710
Longterm Segment assets	Q1-Q3 2019 66,700 8,469 8,235 2,228 34,837 3,169 1,503 1,015 Q1-Q3 2020 22,221		167	242	132	7,515	92	43		0	58 1,191 -2,867	0 126,156 28,794
	Q1-Q3 2019 23,802		206	392	242	9,369	161	84	20		693 -2,858	32,111

CENIT AG

Industriestraße 52-54 D-70565 Stuttgart P. +49 711 7825-30
F. +49 711 7825-4000 E. info@cenit.de www.cenit.com