Eckert & Ziegler Strahlen- und Medizintechnik AG

Quarterly Report • May 9, 2006

Quarterly Report I

		Q1 2006	Q1 2005	Change
Revenue	Million EUR	11.3	8.6	32%
Return on revenue before tax	%	9%	7 %	17%
EBITDA	Million EUR	2.2	1.6	40%
EBIT	Million EUR	1.1	0.7	55%
EBT	Million EUR	1.0	0.6	54%
Net income from continuing operations	Million EUR	0.7	0.5	50%
Earnings per share	EUR	0.21	0.15	38%
Net income / loss (-)	Million EUR	0.6	0.5	40%
Cash flow from operating activities	Million EUR	0.9	0.8	11%
Depreciation and amortization (net)	Million EUR	1.1	0.9	28%
Employees (as of March 31)	Persons	285	247	15%

Dear Shareholder,

Following the impressive final quarter of 2005, the first three months of the new business year have also developed favorably. During this period, the Group's volume of business increased to yield record sales of 11.3 million EUR, representing a 32% rise over the same period of last year.

The Group's traditional segments were responsible for around two thirds of the growth, or approximately 1.6 million EUR, while the new Radiopharmaceutical segment accounted for the rest (1.1 million EUR). The Therapy segment, which acquired no new companies last year, showed an organic growth rate of 16%. The Imaging & Industry segment, for which results from the American company Analytics Inc. and the Czech company SORAD s.r.o. are being consolidated for the first time, increased its sales by 20%.

Regarding profits, the operating result of 1.0 million EUR was more than twice (145%) that of last year's figure of 0.4 million EUR. Because extraordinary foreign exchange earnings of 0.3 million EUR were booked in the first quarter of last year, however, the increase in the quarterly surplus following taxes and distribution to other shareholders was not that high in the first quarter of 2006. It rose by 40%, or 186 TEUR, to 0.7 million EUR, which corresponds to a result per share this quarter of approximately 0.21 EUR (last year: 0.15 EUR).

On the balance sheet, relations have not changed much compared to last year. The balance sheet total decreased by 2.7 million EUR to 64.3 million EUR (-4%), due among other things to a reduction in both liquid funds and accounts receivable and inventory on the asset side and short-term liabilities on the other hand. One of the factors behind this development was the refinancing of the Adlershof cyclotron by EURO-PET Berlin Zyklotron GmbH, a process that included substituting the leasing agreement with General Electric with a lower priced regular loan. Due to the lower balance sheet total on the one hand and the quarterly profit on the other, the equity ratio rose to 55%, and the capital turn-over increased from 0.62 as of 31 December 2005 to the current value of 0.7.

The cash flow statement shows an essentially stable flow out of business operations, with an increase of about 11% over the same quarter of last year, to 0.9 million EUR. Around 1.5 million EUR resulted from a reduction in accounts receivable and inventory, which meant that on the other hand, supply and services obligations, tax provisions, and other liabilities could be reduced by around 2.2 million EUR. Regarding the investment part of the cash flow statement, the substantially higher investment in facilities of 1.1 million EUR was due in part to activating development costs for Modular-Lab™ in addition to normal investment activity. The reduction of 0.8 million EUR in long-term loans is due primarily to a restructuring contribution received by the minority shareholders of EURO-PET Berlin Zyklotron GmbH, who relinquished part of their shareholder loans in the course of the cyclotron turnaround process and sold other parts of their loan in exchange for shares in Eckert & Ziegler AG.

Milestones

■ Large-scale contract to supply cancer radiation systems (afterloader) to Venezuela

■ Conclusion of a cooperation agreement with the Charité university hospital in Berlin to produce short-lived radiopharmaceutical products and establish a Berlin cyclotron association

■ Receipt of authorization to produce 18 F-Fluoroethylcholin, a new tracer for diagnosing prostate cancer

■ Conclusion of licensing agreement between Eckert & Ziegler's Californian subsidiary Isotope Products Laboratories on one hand and International Isotopes Inc. and Radqual LLC. on the other, allowing the latter to build imitation radiation sources for nuclear imaging.

Research and Development

In the Radiophamaceutical segment, the modular synthesis system known as Modular-Lab™ was extended to a broader range of substances for the diagnosis of cancer, Alzheimer, Parkinson and other diseases. The device now offers nuclear medicine specialists at both hospitals and medical offices a safe, convenient and efficient way to produce various radiopharmaceuticals and chemicals for Positron Emission Tomography and other nuclear imaging procedures. The first quarter saw the development and validation of a module for producing 18F-Fluoroethylcholin, a radioactive tracer for diagnosing prostate cancer, as well as a module for producing gallium-68 DOTATOC for diagnosing endocrine tumors. In the Therapy segment, development activities focused on expanding the range of functions for cancer radiation systems.

Staff

Eckert & Ziegler AG employed a total number of staff of 285 (247) throughout the Group as of March 31, 2006.

Outlook

In the coming months, the Nuclear Medicine and Industry segment will concentrate on integrating the units acquired last year and improving various processes and products. The Therapy segment will focus on filling the large-scale contract to Venezuela as well as on acquiring follow-up contracts, while the Radiopharmaceutical segment is preparing a clinical study for the rheumatism drug SpondylAT ® and market introduction of the new Modular-Lab™ family of synthesis systems. Response to this technology platform has thus far been positive. Demand for contrast agents for Positron Emission Tomography in Germany has also developed well, we therefore anticipate a continued increase in sales. Just a few weeks ago, the Group also succeeded in acquiring their first customers for PET-tracers in Poland.

General Information

This unaudited Group Interim Report for the first quarter of the 2006 business year comprises the reports from Eckert & Ziegler Strahlen- und Medizintechnik AG and its subsidiaries (also "Eckert & Ziegler AG" below).

Eckert & Ziegler AG's Group Interim Reports historically have been prepared in accordance with the Generally Accepted Accounting Principles valid in the United States of America (US-GAAP). Due to new regulations, companies listed on the Prime Standard of the Frankfurt Stock Exchange are now legally required to report their results in accordance with the so-called International Financial Reporting Standards (IFRS). While US-GAAP and IFRS in principal do not differ substantially, the numbers of this Group Interim Report can not be compared directly with the Group Interim Report numbers published last year. We have therefore included, for easier comparison, in this report last years results restated in accordance with IFRS.

Dr. Andreas Eckert, Chief Executive Officer

Dr. Edgar Löffler, Executive Vice President Therapy

Dr. Andreas Hey, Executive Vice President Nuclear Medicine & Industry

Berlin, April 28, 2006

Accounting and Valuation Methods

Eckert & Ziegler AG's Group Interim Report of 31 March 2006 was produced in accordance with the International Financial Reporting Standards (IFRS). It takes into account all standards stipulated for application in the EU on that date by the International Accounting Standards Board (IASB) in London, as well as official interpretations by the International Financial Interpretations Committee (IFRIC) or the Standing Interpretations Committee (SIC).

The same accounting and valuation methods were applied to the Interim Report as to the Group Financial Statements of 31 December 2005.

To prepare Group interim reports in accordance with IFRS, it is necessary to make estimates and assumptions about the level and extent of the assets, debts, revenues, and expenditures on the balance sheet. The actual values can deviate from the estimates. Major assumptions and estimates are made for useful lives, obtainable revenues from fixed assets, viability of outstanding accounts, and accounting and valuation of provisions.

This Interim Report contains all the information and adjustments needed to acquire a view of the asset, financial, and profit situations of Eckert & Ziegler AG corresponding to actual conditions at the time of the Interim Report. Sub-year results for the ongoing business year cannot necessarily be used to derive conclusions about the development of future results.

Consolidation Cycle

Eckert & Ziegler AG's Group Interim Report includes all the companies for which Eckert & Ziegler AG is able to directly or indirectly determine financial and business policy (control function). Between 31 December 2005 and 31 March 2006, there were no changes to the consolidation cycle, so the companies included in the Interim Report of 31 March 2006 are the same as those in the Group Financial Statements of 31 December 2005.

Currency Conversion

Financial statements for subsidiaries outside the European Currency Union are converted in accordance with the notion of functional currency. The following exchange rates were used:

Currency	Exchange	Exchange	Average rate	Average rate
	rate on	rate on	for the 1st	for the 1st
	31 March 2006
USD	1.207600	1.291600	1.202640	1.314137
CZK	28.677300	30.041600	28.536370	29.881966
				31 March 2005 quarter of 2006 quarter of 2005

Limited Comparability of this Group Interim Report with Last Year

Eckert & Ziegler AG or its subsidiaries acquired a number of companies during the 2005 business year. This substantially affected the Group's asset and profit situations, which makes it difficult to compare this Group Interim Report with last year.

	Quarterly report	Quarterly report	Annual report
	I/2006	I/2005	2005
	01– 03/2006	01– 03/2005	01–12/2005
	TEUR	TEUR	TEUR
Revenue	11,284	8,577	41,792
Others
Cost of goods sold	-6,130	-5,216	-23,300
Gross profit on sales	5,154	3,361	18,492
Selling expenses	-2,052	-1,323	-7,509
General and administrative expenses	-2,497	-1,774	-8,728
Research and development expenses	-103	-76	-512
Other operating income and expense, net	520	229	793
Operating income/loss	1,022	417	2,536
Interest receivable and payable, net	-136	-85	-667
Gains/losses on currency exchange, net	-47	299	343
Other income/expense, net	133	-	3
Income before tax	972	631	2,215
Income tax expense	-276	-167	-724
Net income from continuing operations	696	464	1,491
Minority interests in net income of consolidated subsidiaries	-46	-	-99
Net income/loss	650	464	1,590
Earnings per share (basic)
Net income from continuing operations	0.22	0.15	0.51
Net income	0.21	0.15	0.51
Earnings per share (diluted)
Net income from continuing operations	0.22	0.15	0.51
Net income	0.21	0.15	0.51
Average number of shares in circulation (basic)	3,123	3,089	3,102
Average number of shares in circulation (diluted)	3,158	3,122	3,134

	Quarterly report	Annual report
	31.03.2006	31.12.2005
	TEUR	TEUR
ASSETS
Non-current assets
Property, plant and equipment	18,206	18,501
Intangible assets	7,121	6,994
Goodwill	11,507	11,681
Equity investments	68	68
Deferred taxes	4,039	3,985
Other non-current assets	1,876	1,860
Total non-current assets	42,817	43,089
Current assets
Cash and cash equivalents	4,033	4,950
Marketable securities	2,448	2,444
Trade accounts receivable, less allowance for doubtful accounts	8,506	9,499
Receivables from related parties	11	13
Inventories	5,790	6,029
Prepaid expenses and other current assets	666	973
Total current assets	21,453	23,908
Total assets	64,270	66,997
EQUITY AND LIABILITIES
Shareholders' equity
Subscribed capital	3,250	3,250
Capital reserve	29,418	29,346
Retained earnings	6,038	4,316
Cumulative other comprehensive income	-3,225	-1,623
Own shares	-409	-434
Minority interests	146	100
Total shareholders' equity	35,217	34,955
Non-current liabilities
Long-term debt, less current portion and capital lease obligations	9,972	9,316
Deferred income from grants and other deferred income	1,574	1,841
Deferred taxes	2,344	2,563
Pension reserves	130	128
	3,680
Other non-current liabilities Total non-current liabilities	17,701	3,755 17,603
Current liabilities
Short-term debt and current portion of long-term debt and capital lease obligations	2,022	3,437
Trade accounts payable	3,772	4,162
Prepayments received	15	55
Accrued expenses	2,650	3,236
Deferred income from grants and other deferred income	936	939
Income tax payable	216	592
Other current liabilities	1,742	2,018
Total current liabilities	11,353	14,439
Total liabilities and shareholders' equity	64,270	66,997

	3-monthly report	3-monthly report
	01–03/2006	01– 03/2005
	TEUR	TEUR
Cash flows from operating activities
Profit for the year	650	464
Adjustments for:
Depreciation and amortization	1,118	873
Proceeds from grants less release of deferred income from grants	-267	-243
Deferred taxes	23	74
Income (-)/expense from stock option plan	-	19
Unrealized foreign currency gains (-)/losses	91	-31
Long-term reserves, other long-term liabilities	-44	47
Gains (-)/losses on the disposal of property, plant and equipment	46	-
Gains (-)/losses on the sale of securities	9	-1
Other items, net	-293	5
Changes in current assets and liabilities:
Receivables	1,282	-656
Inventories	212	-660
Prepaid expenses and other current assets	248	-3
Accounts payable and accounts payable to affiliates	-764	1,014
Tax reserves	-705	23
Other liabilities	-736	-141
Net cash generated from operating activities	870	786
Cash flows from investing activities
Additions to intangible assets and property, plant and equipment	-1,115	-595
Acquisitions of consolidated enterprises	-	-123
Sale of securities	-	-801
Other items	-	- 7
Net cash used in investing activities	-1,115	-1,526
Cash flows from financing activities
Change in long-term borrowing	-750	-115
Change in short-term borrowing	19	-12
Treasury stock used for stock options	97	-
Net cash generated from financing activities	-634	-127
Effect of exchange rates on cash and cash equivalents	-38	57
Decrease/increase in cash and cash equivalents	-917	-810
Cash and cash equivalents at beginning of period	4,950	5,504
Cash and cash equivalents at end of period	4,033	4,694

Balance December 31, 2005	3,250,000	3,250	29,346	4,316	41	-1,664	-434	34,855	100	34,955
interest acquired				-228				-228		-228
Negative minority
Increase/decrease in minority interest								0	285	285
Foreign currency translation differences					1,283		1,283		1,283
previous balance sheet date					-19			-19		-19
losses on securities at
Reversal of unrealized gains/
(after tax of EUR 26 thousand)					41			41		41
securities at balance sheet date
Unrealized gains/losses on
Profit for the year				1,590				1,590	-99	1,491
share option plan			59				107	166		166
for acquisitions and to service
Application of own shares
Cost of share option plan			99					99		99
Dividends paid				-775				-775	-251	-1,026
Balance January 1, 2005	3,250,000	3,250	29,188	3,729	19	-2,947	-541	32,698	165	32,863
	TEUR	TEUR	TEUR	TEUR	TEUR	TEUR	TEUR	TEUR	TEUR	TEUR
	Shares	value	reserve	earnings	securities	differences	shares	shareholders	interest	equity
		Nominal	Capital-	Retained	Unrealized	Exchange	Own	butable to	Minority	holders'
		Subscribed capital				Cumulative other equity items		Equity attri-		share
										Group

										Group
		Subscribed capital				Cumulative other equity items		Equity attri-		share
		Nominal	Capital-	Retained	Unrealized	Exchange	Own	butable to	Minority	holders'
	Shares	value	reserve	earnings	securities	differences	shares	shareholders	interest	equity
	TEUR	TEUR	TEUR	TEUR	TEUR	TEUR	TEUR	TEUR	TEUR	TEUR
Balance January 1, 2006	3,250,000	3,250	29,346	4,316	41	-1,664	-434	34,855	100	34,955
Dividends paid								0		0
Cost of share option plan								0		0
Application of own shares
for acquisitions and to service
share option plan			72				25	97		97
Profit for the year				650				650	46	696
Unrealized gains/losses on
securities at balance sheet date
(after tax of EUR 26 thousand)					2			2		2
Reversal of unrealized gains/
losses on securities at
previous balance sheet date								0		0
Foreign currency translation differences						-533		-533		-533
Increase/decrease in minority interest								0		0
Negative minority
interest acquired								0		0
Balance March 31, 2006	3,250,000	3,250	29,418	4,966	43	-2,197	-409	35,071	146	35,217

01– 03/2006
	Nuclear		Radio
	Medicine		pharma-		Consoli-
	& Industry	Therapy	ceuticals	Others	dation	Totals
	TEUR	TEUR	TEUR	TEUR	TEUR	TEUR
Sales to external customers	5,847	4,298	1,139			11,284
Sales to other segments	110	36	19	217	-382
Total segment sales	5,957	4,334	1,158	217	-382	11,284
Depreciation and amortization	-341	-615	-123	-39		-1,118
Non-cash income and expenses	511	447	-2,142	1,191	256	263
Net income from
continuing operations	410	158	185	-57		696
Segmental assets	27,068	19,147	8,993	38,051	-28,989	64,270
Segmental liabilities	-14,990	-18,939	-9,469	-5,396	19,741	-29,053
Capital expenditure	166	852	97			1,115

Sales by geographic areas 01– 03/2006	Million EUR	%
North America	4.5	40
Europe	5.6	50
Asia/Pacific	0.4	3
Others	0.8	7
	11.3	100

Stock and Stock Options

Management Board and Supervisory Board			March 31, 2006
		Stocks	Stock Options
Dr. Andreas Eckert	Management Board	2,100	18,500
(Eckert Consult GmbH)		(1,260,446)	(0)
Dr. Andreas Hey	Management Board	0	6,000
Dr. Edgar Löffler	Management Board	10,250	16,000
Prof. Dr. Wolfgang Maennig	Supervisory Board	0	0
Prof. Dr. Ronald Frohne	Supervisory Board	19,549	0
Hans-Jörg Hinke	Supervisory Board	0	0
Ralf Hennig	Supervisory Board	141	0
Frank Perschmann	Supervisory Board	1,000	0
Prof. Dr. Nikolaus Fuchs	Supervisory Board	0	0

Financial Calendar

May 09, 2006 Quarterly report I/2006

May 30, 2006 Annual general meeting in Berlin

August 08, 2006 Quarterly report II/2006

November 07, 2006 Quarterly report III/2006

November 29, 2006 German Equity Forum, Frankfurt

Eckert & Ziegler Strahlen- und Medizintechnik AG

Robert-Rössle-Str.10 D-13125 Berlin www.ezag.com

Telephone +49 (0) 30 94 10 84 - 0 Telefax +49 (0) 30 94 10 84 - 112 e-mail info@ezag.de

ISIN DE 0005659700 WKN 565 970