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First Sensor AG

Quarterly Report May 30, 2012

159_10-q_2012-05-30_d75780cd-994e-4a59-97ab-83b69a08e88f.pdf

Quarterly Report

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INTERIM FINANCIAL REPORT AS AT MARCH 31, 2012

Introduction 4

Financial Ratios 5

  • Foreword 6
  • Share Price Performance 9

Management Report 10

Business Model 10
Business Development 11
Events After the Balance Sheet Date 13
Outlook 14

Financial Statements 16

Consolidated Balance Sheet, Assets 16
Consolidated Balance Sheet, Liabilities 17
Consolidated Statement of Comprehensive Income 18
Consolidated Statement of Cash Flow 19
Consolidated Statement of Changes in Equity 20

Notes of the Financial Statements 22 Explanations 22

Responsibility Statement 23
Legal Notice 24
Financial Calendar 24
Contact 24

Financial Ratios

Financial Ratios

Key figures January to March 2012 Q1 2012

in € thousands unless otherwise specified 3M 2012 3M 2011  %
Sales 28,487 13,111 15,376 117
Operating result before depreciation
and amortization (EBITDA)
3,823 1,742 2,081 119
Total net profit for the period 675 606 69 11
Earnings per share (EUR) 0.07 0.09 -0.02 -22
Number of shares (weighted) 9,842,973 6,625,899 3,217,074 49
Equity 69,578 38,599 30,979 80
Equity ratio (%) 43 56 -13 -24
R&D expenses 1,345 1,167 178 15
Number of employees 735 384 351 91

3.8 EBITDA in € million Our operating result rose by 119% to € 3.8 million compared to Q1 2011

Orders on hand Interim Financial Report 3M 2010 - 2012

EBITDA Interim Financial Report 3M 2010 - 2012

Foreword

Foreword

Dr. Hans-Georg Giering Chief Executive Officer

Joachim Wimmers Chief Financial Officer

Precision, individuality and reliability: these are our values

Dear shareholders, dear business partners and employees,

Over the past two decades, First Sensor has successfully and sustainably established itself on the market as a provider of high-quality, customer-specific sensor solutions for renowned customers from a wide range of sectors. First Sensor is positioned to cover the entire value chain – from sensor components and modules through to sensor systems – via our locations. Through the successful acquisition of the sensor division of Augusta Technologies AG last year, we have come a major step closer to our goal of creating a globally renowned integrated industrial company for innovative sensor solutions. Precision, individuality and reliability are our values that are prized by customers around the globe. Following a rather subdued fourth quarter of 2011, we have now returned to our successful course. The results for the current quarter clearly show how much potential there is in the developing First Sensor. At the same time, we are fully aware of the challenges of the integration work that lies ahead. In

the financial year that has just begun, we are therefore focusing our work on optimizing the structures of our company required for further development, tapping potential synergies and integrating the parts of the company added in the acquisition. We are firmly convinced that we can continue our success in the future only as an integrated and efficient industrial company.

The goals for the current financial year 2012 are confirmed by the results of our work in the first quarter. We continue to anticipate sales of €118 million to €122 million, approximately doubling our business volume. We are thus closing the gap to the biggest companies worldwide in our sector. We have set ourselves the ambitious target of almost tripling our operating result before depreciation and amortization (EBITDA) to over €17 million in the current financial year 2012. In the coming years, we will focus on more closely integrating our business activities, increasing operating profitability and exploiting the many opportunities for synergies.

Successful start to the new fi nancial year

First Sensor has made a very successful start to the new financial year. Due in part to the acquisition last year, sales more than doubled in the first quarter, rising by 117% from €13.1 million to approximately €28.5 million. Particularly noteworthy was the increase of around 17% in comparison to the preceding fourth quarter of 2011. This high growth adjusted for acquisition effects significantly outstrips the average growth of our markets and clearly demonstrates the dynamism of our further development.

Although over the next two years the integration costs and the synergies to be exploited will roughly balance each other out, in the first quarter we already generated EBITDA of approximately €3.8 million.

In our current opinion, the slowing general economic momentum since the third quarter of 2011 will not pick up again more substantially until the second half of the current financial year. Therefore, we currently anticipate only a very slight upward trend for the second quarter of 2012 in comparison to the results for the current quarter presented here.

We also pay particular attention to tracking the development of orders on hand. These increased by around 7% to €68.3 million as of the end of the quarter in comparison to €63.6 million as of December 31, 2011. In the same period, the number of employees rose from 725 as of December 31, 2011 to 735.

Above-average growth in sales and profi ts targeted

The increase in orders on hand and the cautious but consistently positive statements from our customers confirm our expectation of a positive financial year. We are aiming to approximately double sales while roughly tripling earnings.

Investments in scalability and advance developments

2012 will be dominated by consolidating our business processes, optimizing structures and in particular integrating the Sensortechnics Group. We began the relevant implementation immediately after concluding the acquisition. From the current perspective, we expect a considerably lower number of one-time negative influences as compared to 2011, but also another significant increase in investments. In the past financial year, we undertook enormous efforts and invested approximately €3.3 million in the relocation of MEMS-based sensor production from Berlin-Adlershof to the modern plant in Berlin-Oberschöneweide. To fully complete the integration work involved

117%

Increase in sales We more than doubled total sales in the first quarter 2012 to reach €28,5 million

17 EBITDA in € million We intend to threefold increase in operating result before depreciation and amortization (EBITDA) in 2012

Share Price Performance

17%

Organic growth Above-average organic growth of 17% compared to Q4 2011

in combining the two previously separate production locations, further investments totaling several million euro will be required in the current financial year. Securing the necessary financing for this will be a major challenge for us in the coming quarters. We are confident that we will be able to successfully complete the entire investment project at the headquarters in Berlin by the end of the first half of 2013 at the latest.

We will use the expertise that we have strengthened considerably over the past two years in the area of MEMS-based high-precision inertial sensors (acceleration, tilt and vibration sensors) to develop new products that will support our future growth. First Sensor has patents

Berlin, May 2012 The Management Board of First Sensor AG

Dr. Hans-Georg Giering Joachim Wimmers

Chief Executive Officer Chief Financial Officer

and technologies that allow for measurements with a much higher than average precision and that promise very innovative products and possible applications, for example for air traffic control systems, drilling platforms and container ships.

These are ambitious goals, but we are confident that we will be able to achieve them provided the general economic environment and the situation of the banks do not deteriorate significantly as a result of the euro crisis.

We will be delighted for you, our shareholders, business partners, customers and employees, to continue to accompany us on this path.

Share Price Performance

The First Sensor Share from January 01, to March 31, 2012

First Sensor AG ISIN: DE0007201907 WKN (German Securities Identification Code): 720190 Symbol: SIS

Business Model Business Development

Group Management Report

Business Model

First Sensor is a developer and manufacturer of customer-specific high-end sensor solutions. These innovative specialized sensor solutions are used for the high-quality conversion of non-electric variables (radiation, light, pressure, flow rate, position, speed, temperature, moisture, etc.) into electric variables that are then used in our customers' electronic systems. This means that our sensor solutions make an important contribution to the competitiveness of our customers' products. Our core competencies include solutions in the area of optical sensors and pressure sensors.

Customers include prominent industrial groups and research institutes. A project generally starts with the customer issuing the specifications and the joint preparation of a development strategy. Following an extensive development and test phase, a supply relationship is initiated that generally lasts for a number of years.

First Sensor's sensor solutions are mostly used as key components in a wide range of applications in several different industries. These include electronic folding rules, tank pressure and sun angle sensors for motor vehicles, fill level measurements in the food industry, air conditioning systems, blood glucose monitors, X-ray machines for baggage screening, machine controls, aerospace research, cancer diagnosis, truck toll monitoring, and measurement systems for the pharmaceutical and environmental technology industries. The broad mix of sectors means that First Sensor is generally independent of cyclical developments in the individual sectors. The market for highend sensor solutions that we address remains a strong growth market.

First Sensor is one of the world's technology leaders, developing and producing optoelectronic and MEMS-based highend sensor solutions for the most stringent specifications. Among other things, this includes the avalanche photodiodes (APD) and avalanche photodiode arrays developed and manufactured by First Sensor in the past, which enjoy a leading global position in their field. One use for these APDs is in high-precision distance measurement systems for a wide range of applications together with laser modules.

First Sensor develops and produces sensor solutions across the individual stages of the value chain. The individual companies of the First Sensor Group are active along the entire value chain. In addition to sensor components, First Sensor develops and manufactures highly reliable customer-specific hybrid circuits and products in the areas of microsystems technology and advanced packaging (sensor modules) right through to complete sensor systems. The different locations in Berlin, Dresden, Oberdischingen, Puchheim, and the foreign locations in the Netherlands, the UK, Sweden, Singapore and the US vary in terms of their position in the value chain (including distribution). Several Group companies are often involved in processing a customer order.

Sensor components are developed and manufactured at the headquarters in Berlin. If the sensor component is later connected to a circuit together with other electronic components and switching circuits (layout and connection technology, hybrid technology, microsystems technology), this creates a sensor module. These process steps take place at five locations within First Sensor: Berlin, Dresden, Oberdischingen, Westlake Village and Singapore. If the sensor module is supplemented with additional stages of the value chain such as signal processing, calibration and product design, this creates a sensor system. This stage of the value chain is implemented at four locations in Berlin, Dresden, Dwingeloo and Puchheim.

With this positioning and interaction of the individual locations, First Sensor covers the entire value chain for specialized sensor solutions and is therefore able both to offer its customers "everything from one source" and also to take on individual steps of the value chain. The specific customer requirements in each case stipulate the stage of the value chain at which our services are called upon. Depending on cost effectiveness, some types of components and services are also purchased externally. Partial orders are allocated to the individual locations centrally.

Business Development

In the past quarter, the First Sensor Group generated sales of €28.5 million (previous year: €13.1 million), representing growth of 117%. Particularly noteworthy was the increase of around 17% in comparison to the preceding fourth quarter of 2011. This high growth adjusted for acquisition effects significantly outstrips the average growth of our markets and clearly demonstrates the dynamism of our further development. The increase resulted in particular from existing customers, with whom significant increases in major projects were achieved in some cases, but initial project launches also contributed to the strong result.

In the first quarter of 2012, EBITDA of €3.8 million was generated, corresponding to a 119% increase as against the same quarter of the previous year (€1.7 million). This good result is also attributable to the inclusion of the sensor division of Augusta Technologies AG that was acquired last year.

Orders on hand increased by 154% as against March 31, 2011 to €68.3 million.

Gross income rose by 117% from €7.7 million in the first quarter of 2011 to approximately €16.7 million in the first quarter of the current financial year. The gross profit margin remained unchanged at 53%.

The 116% increase in staff costs to €9.1 million and the 117% increase in other operating expenses to €3.8 million are due to the effects of the acquisition last year.

The financial result, which primarily includes interest for financing the acquisition and interest for investment loans, amounted to minus €0.6 million (previous year: minus €0.2 million). After deducting taxes, net profit for the period amounted to €0.7 million, up 12% on the previous year's figure of €0.6 million, while earnings per share came to €0.07.

Group equity amounted to €69.6 million, corresponding to an equity ratio of 43%. Cash and cash equivalents totaled €8.7 million. In light of the targeted further growth, there will be a focus on measures to increase liquidity in the coming quarters. In the near future it will primarily be a case of further increasing First Sensor's profitability, since financial stability is particularly important for our customers when it comes to choosing their service providers, as development and production processes take a number of years and the financial stability of the selected partner plays a major role.

Financial liabilities, which were largely taken out to finance the acquisition of the Sensortechnics Group, amounted to €48.9 million as of March 31, 2012. Assuming the general economic situation improves and there are no disturbances on the capital markets, the company currently expects – based on the planning for the coming financial years – to repay all financial liabilities as due.

At minus €3.2 million, cash flow from operating activities was down on the previous year's level due to the increase in working capital as a result of the strong sales growth. Cash flow from investment activities in the amount of minus €3.5 million (previous year: minus €1.2 million) was dominated by investments in property, plant and equipment, including for further improving efficiency in production and expanding production lines at all locations. Repayments of loans (not including working capital loans) totaling €4.0 million were offset by new borrowings of €4.1 million, resulting in cash flow from financing activities in the amount of €0.1 million (previous year: €0.1 million). Overall, cash and cash equivalents fell by €6.7 million as against December 31, 2011 to €3.5 million.

The increase in trade receivables (up €8.0 million to €14.5 million) and inventories (up €21.2 million to €33.4 million) is due to the rise in sales and also in particular the inclusion of the Sensortechnics Group in the consolidated financial statements.

The Group had a total of 735 employees as of March 31, 2012. This increase in comparison to March 31, 2011 (384 employees) is also due primarily to the inclusion of the acquisition in the consolidated financial statements.

Continued investments in scalability of business and in our MEMS Expertise

In the past financial year, we undertook enormous efforts and invested approximately €3.3 million in the relocation of MEMS-based sensor production from Berlin-Adlershof to the modern plant in Berlin-Oberschöneweide. To fully complete the integration work involved in combining the two previously separate production locations, further investments totaling several million euro will be required in the current financial year. Securing

the necessary financing for this will be a major challenge for us in the coming quarters. We are confident that we will be able to successfully complete the entire investment project at the headquarters in Berlin by the end of the first half of 2013 at the latest.

We will use the expertise that we have strengthened considerably over the past two years in the area of MEMS-based high-precision inertial sensors (acceleration, tilt and vibration sensors) to develop new products that will support our future growth. First Sensor has patents and technologies that allow for measurements with a much higher than average precision and that promise very innovative products and possible applications, for example for air traffic control systems, drilling platforms and container ships.

Events After the Balance Sheet Date

On May 4, 2012, the Executive Board of the company received a written request from the shareholder Alegria Beteiligungsgesellschaft mbH c/o DPE Deutsche Private Equity GmbH, Munich ("DPE" or "minority shareholder") in accordance with Section 122 (1) of the German Stock Corporation Act (AktG), which called for an extraordinary General Meeting to be convened. At the extraordinary General Meeting to be convened, a resolution was to be adopted to vote out all three of the Supervisory Board members elected by the shareholders of the company and replace them with three candidates proposed by DPE. Alternatively, DPE requested that this item be added to the agenda of the Annual General Meeting on June 14, 2012 in accordance with Section 122 (2) AktG.

The Executive Board has dealt intensively with this request and has come to the conclusion that it shall not be granted.

In view of the fact that an (extraordinary) General Meeting would be held no more than two months before the company's Annual General Meeting scheduled for mid/late August and there are no apparent objective reasons why the adoption of the resolution on the re-election

of the Supervisory Board should not be postponed until this date, DPE's request for the convention of an extraordinary General Meeting is regarded as a misapplication of the law. After considering the matter as it is required to do, the Executive Board has therefore come to the conclusion that the convention request is irrelevant and will refrain from convening an (extraordinary) General Meeting at DPE's request.

DPE has been notified of this position and accepted it. DPE asked that its convention request from May 4, 2012 be regarded as a request for addition to the agenda of the company's next Annual General Meeting.

In communicating its position to DPE, the Executive Board also clarified that the Executive Board and the current Supervisory Board work together in an extremely constructive and trust-based way and that the Executive Board and Supervisory Board do not support DPE's wish to vote out the current members of the Supervisory Board and elect three new members. By contrast, the Executive Board and Supervisory Board are in favor of expanding the Supervisory Board with three suitably qualified persons to bring it to a total of

six members, appropriately taking into account DPE's proposals. This course of action had also been agreed with DPE before it submitted the convention request. The Executive Board and Supervisory Board do not know why DPE wishes to depart from this agreed course of action. Dismissing the entire Board would be particularly detrimental since there was already a complete change in the composition of the Supervisory Board in 2010 and 2011 and in the event of replacement of the entire Supervisory Board any continuity within the Board would be lost.

The fact that the Annual General Meeting (originally scheduled for June 14) has not yet been convened is due to the fact that external factors, particularly in connection with the ongoing integration of the sensor division of Augusta Technologie AG, have resulted in reporting and resolution requirements for the Annual General Meeting (including with regard to intercompany agreements). In order to avoid unnecessary additional costs, the Executive Board and Supervisory Board have resolved to postpone the Annual General Meeting probably until August 2012 to allow these requirements to be taken into account.

Outlook

Outlook

Through the acquisition of the Augusta Technologies AG sensor division, First Sensor AG has strengthened its position as an innovative, globally operating manufacturer of specialized sensors. It business volume will roughly double in 2012. The acquisition gives rise to a number of strategic options and synergy potential to be exploited by means of appropriate integration measures. These integration measures and the optimization of the corporate, management and controlling structures will form a major focus of management activities in 2012. By achieving a critical mass and increasing the degree of value added in the development and production of sensor solutions, First Sensor will be of interest to additional customer groups, particularly with regard to awarding major long-term contracts.

The strong results for the first quarter, the outlook for the coming quarters, the additional production starts planned and the initial effects of our investments underpin the forecast issued for the current

financial year. The company still expects to generate sales of between €118 million and €122 million in the 2012 financial year. EBITDA is expected to exceed €17 million.

These are ambitious goals, but we are confident that we will be able to achieve them provided the general economic environment and the situation of the banks do not deteriorate significantly as a result of the euro crisis.

Berlin, May 2012 The Management Board of First Sensor AG

Dr. Hans-Georg Giering Joachim Wimmers Chief Executive Officer Chief Financial Officer

Financial Statements

First Sensor AG Consolidated Balance Sheet, ASSETS as at March 31, 2012 (IFRS, unaudited)

in € thousands March 31, 2012 Dec. 31, 2011
Cash and cash equivalents 8,738 12,800
Accounts receivable 14,482 11,101
Due from affiliated companies 0 29
Inventories 33,359 31,368
Tax refund claims 459 438
Payments and accrued income and other current assets 3,606 2,747
Total current assets 60,644 58,483
Property, plant and equipment 41,207 39,141
Intangible assets 29,532 30,166
Shares in affiliated companies 771 980
Investment securities 107 141
Goodwill 30,306 30,306
Deferred tax assets 1,005 982
Other non-current assets 34 35
Total non-current assets 102,962 101,751
TOTAL ASSETS 163,606 160,234

Interim Financial Report Consolidated Balance Sheet, Assets/Liabilities as at March 31, 2012

First Sensor AG Consolidated Balance Sheet, LIABILITIES as at March 31, 2012 (IFRS, unaudited)

in € thousands March 31, 2012 Dec. 31, 2011
Current loans 10,465 10,470
Accounts payable 9,073 8,130
Due to affiliated companies 120 55
Advances from customers 2,194 2,174
Accrued liabilities 439 1,140
Liabilities from income tax 2,588 2,273
Other current liabilities 12,190 12,331
Total current liabilities 37,069 36,573
Long-term interest-bearing loans 38,409 35,652
Provisions 162 173
Deferred taxes 7,539 7,812
Prepayments and accrued income 5,987 6,142
Other non-current liabilities 4,750 4,750
Total non-current liabilities 56,847 54,529
Minority interests 112 91
Subscribed capital 49,215 49,215
Reserves 15,005 15,032
Currency adjustment items -401 -289
Net profit 5,759 5,083
Total equity 69,578 69,041
TOTAL EQUITY AND LIABILITIES 163,606 160,234

First Sensor AG Consolidated Statement of Comprehensive Income from January 01, 2012 to March 31, 2012 (IFRS, unaudited)

in € thousands unless otherwise specified Jan. 01, 2012 -
March 31, 2012
Jan. 01, 2011 -
March 31, 2011
Sales 28,487 13,111
Other operating income 1,082 414
Change in inventories of finished goods and unfinished goods 732 256
Other own work capitalized 254 414
Cost of material/purchased services -13,810 -6,481
Personnel expenses -9,114 -4,223
Depreciation of property, plant and equipment and amortization of intangible assets -2,181 -866
Other operating expenses -3,808 -1,749
Operating result 1,642 876
Income from equity investments 8 0
Interest income 13 21
Interest expenses -611 -183
Currency gains 87 32
Currency losses -98 -59
Result before taxes and minority interests 1,041 687
Taxes on income -345 -67
Net profit for the period 696 620
Net profit for the period attributable to First Sensor AG shareholders 675 606
Net profit for the period attributable to minority interests 21 14
Differences from currency conversion (after tax) -112 -95
Net gain/loss from cash flow hedges (after tax) -66 41
Total expenses and income recognized directly in equity -178 -54
TOTAL NET PROFIT FOR THE PERIOD 518 566
Total net profit for the period attributable to shareholders of First Sensor AG 497 552
Total net profit for the period attributable to minority interests 21 14
Basic earnings per share (EUR) 0.07 0.09
Number of shares applied in the calculation of basic earnings per share (thousands) 9,843 6,626
Diluted earnings per share (EUR) 0.07 0.09
Number of shares applied in the calculation of diluted earnings per share (thousands) 9,897 6,685

Financial Statements

Notes of the Financial Statements FIRST SENSOR AG

Consolidated Statement of Comprehensive Income Consolidated Statement of Cash Flow

Interim Financial Report as at March 31, 2012

First Sensor AG Consolidated Statement of Cash Flow from January 01, 2012 to March 31, 2012 (IFRS, unaudited)

in € thousands Jan. 01, 2012 -
March 31, 2012
Jan. 01, 2011 -
March 31, 2011
Pre-tax income 1,020 687
Adjustments to reconcile operating result with cash flow from operating activities:
Depreciation of property, plant and equipment and amortization of intangible assets 2,181 866
Other non-cash expenses/income 39 39
Income from investment grants -116 -129
Interest income -13 -21
Interest expense 611 183
Income from asset disposal 0 -1
Increase/decrease in provisions -713 -5
Increase/decrease in inventories, accounts receivable and other assets not assigned to investment/financing
activities
-6,249 -833
Increase/decrease in accounts payable and other liabilities not assigned to investment/financing activities 714 419
Interest paid -611 -173
Income tax paid -64 -45
Other profit/losses -42 -27
Cash flow from operating activities -3,243 960
Payments for investments in property, plant and equipment and intangible assets -3,657 -1,149
Payments for investments in affiliated companies 0 -50
Receipts from disposal of property, plant and equipment and intangible assets 170 1
Payments for acquisition of other financial assets -3 0
Interest received 13 21
Cash flow from investment activities -3,477 -1,177
Repayments of financial liabilities -4.021 -777
Proceeds from borrowings 4.089 670
Cash flow from financing activities 68 -107
Currency differences from converting funds -125 12
Net change in cash and cash equivalents -6,652 -312
Cash and cash equivalents at the start of the financial year 10,305 14,058
CASH AND CASH EQUIVALENTS AT THE REPORTING DATE 3,528 13,746

First Sensor AG Consolidated Statement of Changes in Equity as at March 31, 2011 (IFRS, unaudited)

in € thousands
unless otherwise specified
Number
of shares
('000)
Sub
scribed
capital
Share
premi
um
Reve
nue
reser
ves
Un
realized
profit/
loss
Conso
lidated
Balance
sheet
loss/
profit
Exchange
equalizati
on items
Equity
attribu table
to First
Sensor AG
shareholders
Mino
rity
inte
rests
Total
equity
As at January 1, 2011 6,626 33,130 2,136 -404 -90 3,477 -241 38,008 78 38,086
Net profit/loss
for the period
606 606 14 620
Expenses and income
recognized directly
in equity
41 -95 -54 -54
Total net profit
for the period
41 606 -95 552 14 566
Share-based
remuneration
39 39 39
As at March 31, 2011 6,626 33,130 2,136 -365 -49 4,083 -336 38,599 92 38,691

First Sensor AG Consolidated Statement of Changes in Equity as at march 31, 2012 (IFRS, unaudited)

in € thousands
unless otherwise specified
Number
of shares
('000)
Sub
scribed
capital
Share
premi
um
Reve
nue
reser
ves
Un
realized
profit/
loss
Conso
lidated
Balance
sheet
loss/
profit
Exchange
equaliza
tion items
Equity
attribu table
to First
Sensor AG
shareholders
Minority
interests
Total
equity
As at January 1, 2012 9,843 49,215 15,717 -249 -436 5,083 -289 69,041 91 69,132
Net profit/loss
for the period
675 675 21 696
Expenses and income
recognized directly
in equity
-66 -112 -178 -178
Total net profit
for the period
-66 675 -112 497 21 518
Share-based
remuneration
39 39 39
As at March 31, 2012 9,843 49,215 15,717 -210 -502 5,758 -401 69,577 112 69,689

Notes of the Financial Statements FIRST SENSOR AG

Interim Financial Report Consolidated Statement of Changes in Equity as at March 31, 2012

Notes of the Financial Statements

Explanations

(all figures in € thousands unless otherwise specified)

General

First Sensor AG, Berlin, is a listed stock corporation domiciled in Berlin. At the Annual General Meeting on June 9, 2011, the shareholders resolved to rename the former Silicon Sensor International AG as First Sensor AG. The new name was entered in the commercial register on June 25, 2011.

First Sensor AG, Berlin, ("the company" or "First Sensor") and its subsidiaries operate in the sensor production and microsystems technology industries. The company's business mainly focuses on the development, manufacture and distribution of customer-specific optical and non-optical semiconductor sensors and systems. In addition, the First Sensor Group develops and manufactures highly reliable customer-specific hybrid circuits and products in the areas of microsystems technology and advanced packaging.

Consolidated interim fi nancial statements

The consolidated interim financial statements for the period ended March 31, 2012 were prepared in accordance with the International Financial Reporting Standards (IFRS) issued by the International Accounting Standards Board (IASB)

and the interpretations of the International Financial Reporting Interpretations Committee (IFRIC) approved by the IASB as required to be applied in the European Union (EU) and valid as of the reporting date. The requirements of the German Securities Trading Act (WpHG) were also applied.

All of the information in this consolidated interim report is unaudited. This means the information has been subject neither to any audit nor to any review by an independent auditor.

The reporting currency is the euro (€); unless otherwise indicated, all amounts are presented in thousands of euro (€ thousands).

Presentation of accounting policies

As a matter of principle, the accounting policies applied in preparing the consolidated interim financial statements were the same as those applied in preparing the 2011 consolidated financial statements. A detailed description of these accounting policies can be found in the published consolidated financial statements for the 2011 financial year.

Basis of consolidation

The assets, liabilities and results of the acquired Sensortechnics Group, which consists of Sensor technics GmbH, Puchheim, and its subsidiaries Elbau Elektronik Bauelemente GmbH, Berlin, Klay-Instruments B.V., Netherlands, and other subsidiaries, were included in consolidation for the first time with effect from October 1, 2011. This means that the comparability of the results of operations for the first three months of 2011 and 2012 is limited.

Impairment of non-current assets

The First Sensor Group continuously tests its goodwill and other non-current assets for impairment based on the provisions of IAS 36. The impairment test is performed on the basis of the future cash surpluses generated for individual assets or for groups of assets combined in cashgenerating units.

The main non-current assets that are continuously tested for impairment are the goodwill reported in the First Sensor Group and the intangible assets acquired as part of business combinations. In the first three months of 2012, there were no indications that non-current assets were impaired above and beyond the reported carrying amount of these assets.

Explanations Responsibility Statement Interim Financial Report as at March 31, 2012

Impairment of non-current assets

The First Sensor Group continuously tests its goodwill and other non-current assets for impairment based on the provisions of IAS 36. The impairment test is performed on the basis of the future cash surpluses generated for individual assets or for groups of assets combined in cashgenerating units.

The main non-current assets that are continuously tested for impairment are the goodwill reported in the First Sensor Group and the intangible assets acquired as part of business combinations. In the first three months of 2012, there were no indications that non-current assets were impaired above and beyond the reported carrying amount of these assets.

Financial liabilities

In the period from January 1 to March 31, 2012, the First Sensor AG entered into

financial liabilities totaling €4.1 million for the expansion and efficiency improvement of its production capacities. The loans were concluded for a term of seven years. Interest is largely fixed. The loans are secured through the assignment of machinery and equipment and through storage assignment of inventories.

Change in contingent liabilities

In accounting for the Sensortechnics acquisition, a contingent purchase price payment of €9.8 million – consisting of an earnout (€5 million) and a deferred purchase price component (€4.8 million) – was assumed as part of the total consideration. This earnout component is dependent on future earnings. After the balance sheet date, the earnout component was calculated definitively and decreased by €0.5 million to €4.5 million. In accordance with IFRS 3, the goodwill resulting from the transaction therefore declined by €0.5 million to €26.4 million.

Report on post-balance sheet date events

Other than the change in contingent liabilities, no further significant events took place after the balance sheet date.

Responsibility Statement

To the best of our knowledge, and in accordance with the applicable reporting principles for interim reporting, the consolidated interim financial statements give a true and for view of the net assets, financial position and results of operations 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 over the remainder of the financial year.

Berlin, May 2012 The Management Board of First Sensor AG

Dr. Hans-Georg Giering Joachim Wimmers Chief Executive Officer Chief Financial Officer

Legal Notice

This report contains statements of a predictive nature and does not represent any incitement to purchase shares of First Sensor AG, but rather is intended exclusively for information purposes with regard to possible future developments at the company. All future-oriented specifications in this consolidated interim report were produced on the basis of a probability-based plan and represent statements regarding the future which cannot be guaranteed.

Financial Calendar 2012

Date Topic Location
2012-05-30 Publication of Interim Financial
Report as at March 31, 2012
2012-08-27 –
2012-08-29
Analysts´conference
SCC Small Cap Conference
Frankfurt am Main
2012-08-30 Publication of Interim Financial
Report as at June 30, 2012
2012-11-12 -
2012-11-14
German Equity Capital Forum Congress Center at Messe
Frankfurt am Main
2012-11-29 Publication of Interim Financial
Report as at September 30, 2012

Contact

First Sensor AG Peter-Behrens-Str. 15 12459 Berlin, Germany T +49 30 639923-710 F +49 30 639923-719 [email protected] www.first-sensor.com

First Sensor AG ISIN: DE0007201907 WKN (German Securities Identification Code): 720190 Symbol: SIS

This Interim Financial Report as at March 31, 2012 is available in German and English. Both versions are also available for download on the internet at www.first-sensor.com. Financial Statements Notes of the Financial Statements FIRST SENSOR AG 25

as at March 31, 2012 Legal Notice Financial Calendar 2012 Contact

Interim Financial Report

First Sensor AG

Peter-Behrens-Str. 15 12459 Berlin Deutschland T +49 30 6399 2399 F +49 30 6399 2333 [email protected] www.first-sensor.com

First Sensor Technology GmbH

Peter-Behrens-Str. 15 12459 Berlin Deutschland T +49 30 639923-810 F +49 30 639923-816 [email protected] www.mems.first-sensor.com

Microelectronic Packaging Dresden GmbH

Grenzstr. 22 01109 Dresden Deutschland T +49 351 2136-100 F +49 351 2136-109 [email protected] www.mpd.de

Silicon Micro Sensors GmbH

Königsbrücker Str. 96 01099 Dresden Deutschland T +49 351 3177 62-10 F +49 351 3177 62-12 [email protected] www.smicrosensors.com

Lewicki microelectronic GmbH

Allee 35 89610 Oberdischingen Deutschland T +49 7305 9602-0 F +49 7305 9602-50 [email protected] www.lewicki-gmbh.de

First Sensor Inc.

5700 Corsa Avenue # 105 Westlake Village, CA 91362 USA T +1 818 706-3400 F +1 818 889-7053 [email protected] www.pacific-sensor.com

Silicon Projects GmbH

Peter-Behrens-Str. 15 12459 Berlin Deutschland T +49 30 6399 2399 F +49 30 6399 2333 [email protected] www.first-sensor.com

memsfab GmbH

Technologie-Campus 1 09126 Chemnitz Deutschland T +49 371 5347-680 F +49 371 5347-681 [email protected] www.memsfab.de

Sensortechnics GmbH

Boschstr. 10 82178 Puchheim Deutschland T +49 89 8008-30 F +49 89 8008-333 [email protected] www.sensortechnics.com

Sensortechnics Corp.

1980 Sherbrooke St. West Suite 505 Montreal, QC H3H 1E8 Kanada T +1 514 938-8089 [email protected] www.sensortechnics.com

Sensortechnics Inc.

896 Main Street Walpole, MA 02081 USA T +1 508 66088-23 F +1 508 66088-36 [email protected] www.sensortechnics.com

Sensortechnics Scandinavia AB

Jägerhorns väg 10 141 75 Kungens Kurva Schweden T +46 8 4495642 F +46 8 4495649 [email protected] www.sensortechnics.com

Klay Instruments B.V.

Nijverheidsweg 5 7991 CZ Dwingeloo Niederlande T +31 521 5915-50 F +31 521 5920-46 [email protected] www.klay.nl

ELBAU Elektronik Bauelemente

GmbH Berlin Darßer Bogen 19 13088 Berlin

Deutschland T +49 30 92404-20 F +49 30 92404-292 [email protected] www.elbau-gmbh.de

Elbau Singapore Pte. Ltd

3 Kallang Sector Singapore 349278 Republic of Singapore T +65 6747 6670 F +65 6747 5202 [email protected] www.elbau-gmbh.de

Pressure & Flow Ltd.

McGowan House 66C Somers Road Rugby, Warwickshire CV22 7DH Großbritannien T +44 1788 5604-26 F +44 1788 5612-28 [email protected] www.sensortechnics.com

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