GFT Technologies SE — Interim / Quarterly Report 2013

Aug 12, 2013

Half-yearly financial Report as of 30 June 2013

ing neer pio digi tal

Key figures according to IFRS

(not certified)

		Half-year
		01/01/– 30/06/2013	01/01/– 30/06/2012	Change
Income Statement
Revenue	€m	114.19	116.38	-1.9%
Earnings before interest, taxes, depreciation and amortisation (EBITDA)	€m	6.09	4.43	37.5%
Earnings before interest and taxes (EBIT)	€m	5.36	3.67	46.0%
Earnings before taxes (EBT)	€m	5.50	3.78	45.4%
Net income	€m	4.36	2.36	84.7%
Balance Sheet
Other non-current assets	€m	47.90	45.40	5.5%
Cash, cash equivalents and securities	€m	27.71	30.40	-8.9%
Other current assets	€m	57.95	54.41	6.5%
Assets	€m	133.56	130.21	2.6%
Non-current liabilities	€m	6.34	8.15	-22.2%
Current liabilities	€m	48.57	48.90	-0.7%
Shareholders' equity	€m	78.65	73.16	7.5%
Share holder s' equity and liabi litie s	€m	133.56	130.21	2.6%
Equity ratio	%	59%	56%	4.8%
Cash flow
Cash flow from operating activities	€m	-8.83	-5.56	59.0%
Cash flow from investing activities	€m	0.87	-0.57	-252.6%
Cash flow from financing activities	€m	-1.35	-3.48	-61.3%
Employees
Number of permanent employees (as of 30 June)	no.	1,503	1,371	9.6%
Share
Earnings per share	€	0.17	0.09	84.7%
Average number of outstanding shares (undiluted)		26,325,946	26,325,946	0.0%

(Rounding differences in the Consolidated Interim Management Report due to presentation in € million possible)

The GFT Group closed the first six months of 2013 with solid revenue growth and a strong improvement in earnings. For the second half of 2013, the Executive Board expects a further positive development of business and anticipates an additional growth impetus from the acquisition of the Italian company Sempla. For the financial year 2013, the Executive Board now expects revenue of €260 million and has upgraded its forecast for earnings before taxes (EBT) to at least €15 million. Earnings before interest, taxes, depreciation and amortisation (EBITDA) are expected to reach at least €19 million in 2013.

Contents

Group Management Report

of GFT Technologies Aktiengesellschaft as of 30 June 2013 (not certified)

Business environment

Economic environment

Macroeconomic development

The global economy will be less prone to fluctuation and enjoy moderate growth in future. This is the forecast of the World Bank. Whereas the economists predicted global economic growth of 2.4% in January 2013, they downgraded their expectations to 2.2% on completion of the first six months of 2013. Although the US economy is still performing well in comparison to other major economic regions, both the World Bank and International Monetary Fund (IMF) believe slower growth in the emerging nations represents a serious danger. The latter were a vital motor of global growth during the financial crisis of 2008. Two of the heavyweights, China and Brazil, are now experiencing economic difficulties.

According to both institutes, the main burden to growth is still the recession in Europe. The eurozone crisis has lasted five years already and affected almost all member states. Even such major economies as France, Italy and Spain are now mired in recession. All three of these countries are suffering their highest ever levels of unemployment. It was only in July 2013, that European Central Bank (ECB) boss Mario Draghi calmed the markets somewhat by promising that the ECB would buy an unlimited number of bonds from the troubled nations if necessary. In early May, the ECB had already reduced interest rates in the eurozone to a new historic low of 0.5% in an attempt to kick-start the recovery. According to Draghi, this effect is now expected to gradually and very slowly materialise towards the end of the year.

The ongoing uncertainty in the eurozone region was also felt in Germany during the second quarter of 2013. Although the IMF was still optimistically assuming growth of 0.6% for the full year in April, it downgraded its forecast to 0.3% after the first six months. The Institute believes that growth will be driven exclusively by domestic forces in both the current and coming years. Head of Business Cycle Analysis at the ifo Institute, Kai Carstensen, is somewhat more optimistic. Although the economic

repercussions of Germany's catastrophic floods during the second quarter are still not clear, German managers are generally upbeat. This was the conclusion of ifo's Business Climate Index conducted in June.

Sector development

In the first six months of 2013, the global IT market was unable to fully escape the effects of the downbeat economic mood around the world. According to the international market research institute IDC, IT expenditure already fell short of expectations in the first quarter of 2013. As a result, the institute reduced its growth forecast for global IT spending in 2013 from 5.5% at the beginning of the year to 4.9% in May 2013. The main culprit is falling demand for IT hardware. Demand for IT services, however, remains strong.

The German Federal Association for Information Technology, Telecommunications and New Media (BITKOM) reports more positive figures for Germany. Its survey of market sentiment in July 2013 showed that most suppliers of information technology, telecommunication and entertainment electronics were satisfied with business in the first half-year. 57% succeeded in raising sales. Business was even better for IT service providers – 70% of whom reported increased revenues. This upbeat mood is expected to continue in the second half of the year. This is also reflected by the BITKOM Index, which remains high and continues to exceed expectations for the economy as a whole (ifo Index). According to the sector organisation, demand for skilled staff is still strong. 55% of companies believe the current situation represents an obstacle to further growth.

The sector investing most heavily in IT is the financial services industry – also of particular importance to GFT. This was the conclusion of a survey conducted by Forrester Research Inc. examining companies in the Americas, Europe and Asia. One key reason was the level of compliance regulations requiring IT support.

Course of business

Despite the ongoing weakness of the eurozone economies, the GFT Group can look back on a satisfactory first six months to 2013. With consolidated revenue of €114.19 million (prev. year: €116.38 million), the Group fell 2% short of the prior-year figure. Adjusted for the planned reduction of revenue from its Third Party Management business amounting to €9.03 million, however, the Group's core business grew by 6% in the first six months. Pre-tax earnings (EBT) increased by 46% to €5.50 million (prev. year: €3.78 million). This figure includes income of €1.18 million from the adjustment of the purchase price for Asymo AG, Switzerland, acquired in 2011, as well as costs for the CODE_n12 innovation drive amounting to €0.90 million (prev. year: €1.32 million).

There was particularly encouraging growth in the GFT Solutions division, which raised revenue by 14% to €69.14 million (prev. year: €60.85 million). This positive development was helped by increased compliance requirements for the finance sector as well as projects connected with the introduction of the Single Euro Payments Area (SEPA). The growing demand for outsourcing services, as well as solutions for investment banking and mobile banking, boosted sales in the UK and Germany. Due to a high degree of capacity utilisation and positive margin effects, segment earnings rose by 63% to €6.93 million (prev. year: €4.25 million).

The emagine division, whose realignment is continuing in 2013, posted revenue of €45.04 million – 19% down on the previous year (€55.53 million). Revenue from helping companies recruit IT and engineering specialists for technology projects fell by 2% to €43.70 million (prev. year: €44.59 million). The division's low-margin Third Party Management business only contributed €1.34 million to segment revenue (prev. year: €10.94 million). In 2013, the planned reduction in revenue from this business will amount to around €15 million. Segment earnings of the emagine division were burdened by realignment costs and amounted to €0.00 million (prev. year: €1.15 million). Due to the positive development of business and high utilisation of capacity in the GFT Solutions division, headcount at the Spanish development centres was increased strongly. GFT employed more than 1,500 full-time staff as of 30 June 2013.

With the acquisition of an 80% stake in the company Sempla S.R.L., Milano, Italy, on 30 May 2013, the GFT Group took a further important step towards the internationalisation of its GFT Solutions division. Sempla is one of Italy's leading IT consultancies, specialising in commercial and private banking. With its 460 employees, it generated revenue of over €44 million and pre-tax earnings of €4.08 million in 2012. Sempla's product range fits well with the portfolio of GFT and adds top-quality consultancy know-how on the Italian market and acclaimed expertise in the general banking sector. This provides synergies for the further development of the Italian market and offers GFT growth opportunities with existing and new clients in Europe and the USA. The acquisition of Sempla was closed on 3 July 2013 so that the effects from the takeover will become effective for the GFT Group's accounts as of the 3rd quarter of 2013.

gfT share

following a slightly positive sideways movement in the fi rst quarter of 2013, the international stock markets were marked by strong volatility in the second quarter. Tension between North and south Korea as well as forecasts of weaker growth for China and the global economy as a whole put pressure on the leading indices during April. The german blue-chip DAX index was also weakened by a disappointing labour market report in late March and fell below 7,600 points. After poor economic data and growing eurozone unemployment had prompted the ECB to reduce interest rates on 2 May, a turnaround was reached. The consequence was new record-highs on the world's stock markets. On 3 May, the Dow Jones succeeded in breaking the 15,000-mark for the fi rst time and the DAX (Performance Index) reached an all-time-high of 8,530.89 points on 22 May – after hitting new record levels on twelve successive days. This euphoria was dealt its fi rst blow in early June, caused by concerns about the world's second-largest economy: China. The us federal Reserve also declared that it would only provide support to the economy until us unemployment had fallen to 6.5%. Although ECB President Draghi gave assurances that there were still suffi cient funds to support markets, the EuRO sTOXX, DAX and TecDAX indices fell strongly, while the us markets suffered only moderate losses.

following growth of 6% in the fi rst quarter, the gfT share was largely unaffected by the general market turbulence in the second quarter. Despite the highly volatile stock market environment, the share succeeded in keeping its basic price above the moving average of the 38-day-line (€3.45). The share started in April at the prior-month closing price

of €3.44 and subsequently climbed to a month-high of €3.64. On presentation of the latest company fi gures in May, this upward trend was solidifi ed and continued. By 15 May, the share had reached a preliminary month-high price of €3.85. The dividend payout of €0.15 on the following day had no effect on the further development. Compared to the preceding month, daily trading volumes were increased strongly and averaged 34,135 traded shares. The reporting month of May closed at €4.00 – an increase of 12.99% over the prior-month closing rate.

This healthy upward trend also continued in June with the share reaching its highest level of the fi rst half-year on 19 June. The price only weakened somewhat towards the end of the month. Although the reporting month June proved turbulent for the market as a whole, the gfT share closed at €4.09 – representing growth of 27% for the fi rst six months.

Shareholder structure

There were no changes in the shareholder structure of gfT Technologies Aktiengesellschaft in the period under review. 28.08% of shares are still held by company founder ulrich Dietz. Maria Dietz owns 9.68% of shares, while former supervisory Board member Dr Markus Kerber holds 5.00%. The free fl oat portion comprises 57.24% of all gfT shares.

Shareholder structure

Share performance indexed

Information on the GFT share

	H1 2013	H1 2012
Year-opening quotation (daily closing prices Xetra)	€3.22	€2.75
Closing quotation on 30 June (daily closing prices Xetra)	€4.09	€2.90
Percentage change	+27%	+5%
Highest price (daily closing prices Xetra)	€4.20 (19/06/2013)	€3.20 (02/03/2012 13/–16/03/2012 20/–21/03/2012)
Lowest price (daily closing prices Xetra)	€3.20 (03/01/2013) (07/01/2013)	€2.75 (02/01/2012)
Number of shares on 30 June	26,325,946	26,325,946
Market capitalisation on 30 June	€107.67 million	€76.35 million
Average daily trading volume in shares (Xetra and Frankfurt)	24,669	12,954
Earnings per share	€0.17	€0.09

ISIN	DE 0005800601
Initial stock market quotation	28/06/1999
Market segment	Prime Standard

Development of revenue

In the fi rst six months of 2013, the gfT group generated consolidated revenue of €114.19 million, some 2% below the prior-year fi gure (€116.38 million). The planned reduction in low-margin Third Party Management business amounted to €9.03 million in the fi rst six months. Adjusted for this discontinued revenue contribution, the group's core business grew by 6% year on year.

Revenue by segment

The GFT Solutions division achieved revenue growth of 14% to €69.14 million (prev. year: €60.85 million) in the fi rst six months of 2013. Revenues in this division were driven by growing compliance requirements in the fi nance sector and especially projects relating to the introduction of the single Euro Payments Area (sEPA). growth was helped further by rising demand for solutions in the fi eld of investment banking and mobile banking. The division's share of consolidated revenue rose to 61% (prev. year: 52%).

In the emagine division, revenue was 19% down on the previous year at €45.04 million for the fi rst six months of 2013 (prev. year: €55.53 million). This fi gure includes the planned reduction of revenues in the lower-margin Third Party Management business of €9.03 million. With its consultancy services for the staffi ng of technology projects with highly skilled IT and engineering experts, the emagine division reported a decline in revenues of 2% to €43.70 million (prev. year: €44.59 million). The division's low-margin Third Party Management business contributed €1.34 million (prev. year: €10.94 million) to segment revenue. All in all, this division's share of consolidated revenue fell to 39% (prev. year: 48%).

Revenue by country

The region Germany, which is affected most by the withdrawal from Third Party Management business, reported a fall in revenue of 10% to €40.18 million (prev. year: €44.72 million). The gfT solutions division enjoyed strong growth. The region remained the gfT group's largest sales market with a share of total revenue of 35% (prev. year: 38%).

Revenue by country

spain 12% 13.21 switzerland 4% 4.37 usA 4% 4.29 Other countries 4% 5.54

The GFT Group recorded its strongest revenue growth in the UK during the first half of 2013. Driven by strong demand from the investment banking industry, revenues here rose by 43% to €25.94 million (prev. year: €18.11 million). This positive development was driven by both the GFT Solutions division and the emagine division. This region's share of Group revenue rose to 23% (prev. year: 16%).

Business in France also made encouraging progress. Strong demand for IT and engineering specialists in the industrial and service sectors helped raise revenue by 4% to €20.66 million (prev. year: €19.92 million). The region accounted for 18% (prev. year: 17%) of total Group revenue.

In Spain, the GFT Group posted revenue of €13.21 million and was thus just 5% down on the previous year (€13.95 million). At 12%, the country's contribution to total revenue remained unchanged (prev. year: 12%).

Revenue generated in Switzerland amounted to €4.37 million, corresponding to a year-on-year decline of 29% (€6.19 million). The region's share of Group revenue fell to 4% (prev. year: 5%). The decline is due to reduced capacity utilisation in the GFT Solutions division and the discontinuation of local emagine business in the third quarter of the previous year.

In the USA, revenue fell by 28% to €4.29 million (prev. year: €5.96 million). Revenue from other countries reached €5.54 million (prev. year: €7.53 million), corresponding to a decline of 26%.

Revenue by industry

At the beginning of financial year 2013, revenue by industry was reclassified in order to reflect business in the relevant target markets more transparently. Prior-year figures were adjusted accordingly.

With a 64% share of the GFT Group's total revenue (prev. year: 61%), the financial service providers sector remained the most important industry for GFT in the first half of 2013. Revenue losses from discontinued Third Party Management business were completely offset in this sector by strong revenue growth in the GFT Solutions segment. All in all, revenue in this sector increased by 2% to €72.66 million (prev. year: €70.96 million).

The proportion of revenue contributed by the sector other service providers fell to 14% (prev. year: 17%). Revenues were down by 17% to €16.32 million (prev. year: €19.63 million) due to lower sales in both the emagine segment and GFT Solutions segment.

Revenue in the other industries sector fell by 2% to €25.21 million (prev. year: €25.79 million) and accounted for 22% of Group sales (as in the previous year).

	H1 2013	€ million
Financial service providers	64%	72.66
Other industries	22%	25.21
Other service providers	14%	16.32

Revenue by industry

Earnings position

In the first six months of 2013, earnings before taxes (EBT) of the GFT Group amounted to €5.50 million and were thus 46% up on the previous year (€3.78 million). The operating margin before taxes improved strongly by 1.5 %-points, from 3.3% in the previous year to 4.8%. These half-year figures include income from the adjustment of the expected remaining purchase payment for Asymo of €1.18 million.

Earnings before interest and taxes (EBIT) amounted to €5.36 million in the first six months and were thus 46% above the prior-year figure (€3.67 million). Earnings before interest, taxes, depreciation and amortisation (EBITDA) rose by 37% to €6.09 million (prev. year: €4.43 million).

In the first half-year, the GFT Group generated earnings after taxes of €4.36 million, corresponding to year-on-year growth of 85% (€2.36 million). This strong improvement benefited from a reduction in the calculated tax ratio from 38% in the previous year to 21% in the first six months, as well as from improved earnings of the »others« division.

Earnings per share rose by €0.08 to €0.17 (prev. year: €0.09 per share) based on 26,325,946 outstanding shares.

Consolidated earnings position by segment

In the first half of 2013, the earnings contribution of the GFT Solutions segment rose by 63% to €6.93 million (prev. year: €4.25 million), corresponding to an increase in the operating margin to 10.0% (prev. year: 7.0%). This year-on-year rise in earnings results mainly from the very positive development of business in the UK und Germany.

Earnings of the emagine segment amounted to €0.00 million after the first six months of 2013 (prev. year: €1.15 million). This figure was burdened by expenses involved with the division's realignment and the establishment of the brand in the target markets Germany, France and the UK. Due to reduced revenues and low earnings, the operating margin deteriorated by 2 %-points (prev. year: 2.1%).

The »others« category comprises balance sheet effects, costs of the holding company and consolidation amounts which cannot be directly charged to either of the two aforementioned divisions. At €-1.43 million, pre-tax earnings of this division were up 11% on the previous year (€-1.62 million). As in the previous year, the largest individual item in this category was the cost for the CODE_n project and CeBIT fair presence.

Earnings by segment

	GFT Solutions			emagine	others		Total
€ million	H1 2012	H1 2013	H1 2012	H1 2013	H1 2012	H1 2013	H1 2012	H1 2013
	4.25	6.93	1.15	0.00	-1.62	-1.43	3.78	5.50

Consolidated earnings position by income and expense items

In the first half of 2013, other operating income rose to €2.42 million (prev. year: €1.46 million). This increase of €0.96 million was mainly due to the partial reversal of an earn-out provision for the Asymo acquisition as well as to other operating income. This other operating income was mostly generated via the CODE_n partnerships.

The item cost of purchased services mainly comprising the use of external manpower – fell by €6.44 million to €48.55 million (prev. year: €54.99 million) due to lower revenues in the Third Party Management business and the related purchase of external employees. The cost of materials ratio – the relationship between cost of materials and revenue – consequently fell year on year by 4 %-points to 43% (prev. year: 47%).

In the reporting period, personnel expenses increased by €2.44 million to €48.86 million (prev. year: €46.42 million). As a proportion of revenue, personnel expenses were up slightly to 43% (prev. year: 40%). This increase of around 3 %-points was a result of the strongly increased revenue share of the more labour-intensive GFT Solutions segment to 61% (prev. year: 52%) and the related increase in headcount in this division during the first half of 2013.

Depreciation of intangible and tangible assets fell slightly to €0.73 million in the first six months of 2013 (€0.76 million). As in previous periods, this item had only a minor impact on ordinary operating profits.

Other operating expenses rose by 8% to €13.00 million in the first half of 2013 (prev. year: €12.00 million). The main cost elements are operating, administrative and selling expenses, which rose by €0.79 million to €12.15 million (prev. year: €11.36 million). This item also includes exchange rate losses and other taxes.

Income taxes amounted to €1.14 million in the first six months and were thus €0.28 million below the prior-year figure of €1.42 million. The calculated tax ratio fell strongly by 17 %-points to 21% (prev. year: 38%). This was due to a more even distribution of profits among the various national subsidiaries and the non-taxable adjustment to the Asymo earn-out provision during the reporting period.

Financial position

As of 30 June 2013, cash, cash equivalents and securities amounted to €27.71 million and were thus €12.71 million below the corresponding figure at the end of 2012 (€40.42 million). The decline resulted from a significant fall in liquid funds, mainly due to the payment behaviour of certain clients, as well as from a reduction in payables of €9.44 million to €26.47 million.

Due to the delayed receipt of payments, trade receivables rose by €10.2 million to €54.41 million as of 30 June 2013. At year-end 2012, the figure stood at €44.21 million.

Trade payables – consisting mainly of amounts owing to external employees – amounted to €16.69 million on 30 June 2013. This corresponds to a reduction of €3.14 million compared to 31 December 2012 (€19.83 million). Since the planned winding down of Third Party Management business last year, liabilities have remained relatively stable since the beginning of the year.

Cash flows from operating activities amounted to €-8.83 million (prev. year: €-5.55 million) after the first six months. This difference is mainly due to the increase in receivables. Changes in trade receivables fell by €9.52 million compared to the prior-year figure (€-0.91 million), which was affected by short-term positive items. This effect was partially offset by the strongly reduced change in trade payables and other liabilities, which amounted to just €-1.33 million in the reporting period (prev. year: €-7.69 million).

Working capital (the difference between current assets and current liabilities) amounted to €36.97 million as of 30 June 2013 and was thus €0.29 million below the yearend 2012 figure of €37.26 million.

At €0.87 million, cash flows from investing activities were above the prior-year figure of €-0.57 million. The purchase of a new administration building in Stuttgart as the Company's future head office amounting to €1.9 million was offset by proceeds from the disposal of financial investments, which was also responsible for the strong improvement in cash flow of €1.44 million. This item also includes smaller investments in tangible assets, including IT procurements.

As of 30 June 2013, cash flows from financing activities amounted to €-1.35 million (prev. year: €-3.48 million). This figure concerns the use of short-term credit lines by a foreign subsidiary.

Asset position

As of the beginning of 2013, the requirements of IAS 19 (revised) have been applied. As a consequence, actuarial gains and losses must now be recognised in the balance sheet without an effect on profit or loss. This also necessitated a retroactive adjustment of various balance sheet items as of 31 December 2012. Further details on this topic are provided in the Notes to the Consolidated Interim Financial Statements.

The balance sheet total of the GFT Group increased slightly by €1.08 million and stood at €133.56 million as of 30 June 2013. At the end of the financial year 2012, the total had amounted to €132.48 million.

Compared to 31 December 2012 (€48.17 million), there was a minor decrease in non-current assets of €0.15 million to €48.02 million. This was largely due to a shift in certain items: a strong increase in tangible assets resulting mainly from the purchase of the new administration building and a decrease in securities.

As of 30 June 2013, current assets amounted to €85.54 million and were thus €1.23 million above their year-end 2012 level (€84.31 million). There was a sharp increase of €10.20 million in trade receivables to €54.41 million (31 December 2012: €44.21), which was opposed by a fall in liquid funds of €9.44 million to €26.47 million (31 December 2012: €35.91 million).

At the end of the first half of 2013, equity amounted to €78.65 million and was thus €0.44 million above the corresponding figure on the balance sheet date of 31 December 2012 (€78.21 million). The change was mainly due to a reduction in the balance sheet loss from €-3.83 million to €-3.42 million. As a consequence of this marginal difference, the current equity ratio remains unchanged from 31 December 2012 at 59%.

On the liabilities side, there was a rise in current liabilities of €1.52 million compared to 31 December 2012, mainly due to the increase in financial liabilities of €2.60 million and in current income tax liabilities of €1.29 million. The increase in financial liabilities results from a shortterm loan taken out by a subsidiary.

This was opposed by a decline in trade payables of €3.14 million to €16.69 million. As of 31 December 2012, the figure had stood at €19.83 million.

There was only a slight change in non-current liabilities during the period under review. As of 30 June 2013, they stood at €6.34 million and were thus down by €0.88 million compared to year-end 2012. This decrease was due to a reversal of provisions.

The equity/non-current assets ratio – the yardstick for solid balance sheet structures – rose to 164% as of 30 June 2013 (year-end 2012: 162%). This ratio expresses the relationship between the balance sheet items »equity« and »non-current assets« and provides information about the Company's financial stability.

As of 30 June 2013, the GFT Group employed a total of 1,503 people. This corresponds to an increase of 132 persons or 10% compared to the same date last year. Headcount is calculated on the basis of full-time staff, whereby part-time staff are included on a pro rata basis.

In the GFT Solutions division, the number of employees rose by 11%: from 1,220 at the end of the first half of 2012 to 1,360 on 30 June 2013. The strongest increase in headcount was in Spain (up 121 to 950 employees). The emagine division employed 94 people. The decrease of 11 persons corresponds to a 10% decline compared to the same date last year. The »others« category remained virtually unchanged at 49 employees, corresponding to a year-on-year increase of 3 persons or 7%.

As of 30 June 2013, 274 people were employed in Germany (prev. year: 271). Comprising 1,229 persons, the proportion of GFT staff employed outside Germany amounted to 82% (prev. year: 80%).

Employees by country as of 30 June

	2013	2012
Germany	274	271
Brazil	158	150
France	18	16
UK	40	34
Switzerland	41	49
Spain	950	829
USA	22	22
Total	1,503	1,371

Employees by division as of 30 June

	2013	2012
GFT Solutions	1,360	1,220
emagine	94	105
Others	49	46
Total	1,503	1,371

The number of freelance staff fell year on year by 73 to 949 persons (-7%).

Employees Research and development

The GFT Group invested a total of €1.02 million in research and development during the reporting period (prev. year: €0.72 million).

The largest share of this total (€0.88 million or 86%) was accounted for by personnel expenses (prev. year: 75%). In the first six months of 2013, the GFT Group concentrated its R&D efforts on the following strategic initiatives:

At the SAP Competence Centre, experts develop tailored solutions for financial institutes, which help them integrate SAP software into their existing IT platform. One of the key topics in the first half of 2013 was the further development of possible uses for in-memory databases based on SAP HANA technology. This technology is integrated into client solutions in order to significantly reduce the computing time for complex simulations, thus enhancing its use in consultation sessions.

Mobile Finance activities comprise the development of key applications for mobile devices in the financial services sector. In the first six months, investments were made for example in development and integration services for the field of Mobile Finance in order to design and implement tailored IT solutions and services for the finance sector.

In its internal Applied Technologies Group, GFT pools all R&D activities in the field of applied innovation management. Based on the open innovation approach, the Applied Technologies Group initiates and coordinates innovation projects in line with the current solution needs of our clients.

In order to ensure consistently high quality in its global development efforts, software development processes were further optimised in accordance with the international CMMI® (Capability Maturity Model Integration) standard.

Subsequent events Forecast report

In an agreement dated 30 May 2013, GFT Holding Italy S.R.L., Milano, Italy, acquired an 80% stake in the Italian IT service provider Sempla S.R.L. The acquisition of the company was closed on 3 July 2013 and GFT Holding Italy S.R.L. has controlled the acquired company since this date. Further information on this transaction is provided in the Consolidated Interim Financial Statements on page 35.

Opportunity and risk report

In the first six months of 2013, there were no material changes with regard to the comprehensive discussion of opportunities and risks provided in the Management Report accompanying the Consolidated Financial Statements for 2012. The risk position of the GFT Group is thus unchanged.

Macroeconomic development

According to the World Bank, the global economy will continue to gain stability but grow more slowly than expected. In its latest economic outlook of 12 June 2013, the Institute therefore downgraded its global forecast for 2013 from 2.4% to 2.2%. The experts pointed to a worse than expected recession in Europe and slower growth in major emerging nations, such as China, Brazil, India and Russia, which had driven the global economy over the past years. For 2014, the World Bank now forecasts global growth of 3%, rising to 3.3% in 2015.

In its World Economic Outlook published on 16 April 2013, the International Monetary Fund (IMF) is somewhat more optimistic with a forecast for global economic growth of 3.5% in 2013 and 4% in 2014. Europe is still the main risk for global financial stability following its five rescue packages for member states so far. The IMF forecasts an overall decline in output for the eurozone of 0.3% in the current year and slight growth of 1.1% in 2014. In its Germany Report of 2 June 2013, the IMF downgraded its 2013 forecast of April from 0.6% to just 0.3% with reference to the ongoing uncertainty of the eurozone region. At the same time, however, the IMF claimed that the German financial sector had gained in solidity and resistance compared to the past.

Sector development

In its latest forecast of 2 July 2013, the market research institute Gartner downgraded its growth outlook for global IT spending in 2013 from 4.1% to 2%. Gartner states that the strong downgrade is mainly due to fluctuations in dollar exchange rates. If exchange rates had remained stable, the revised growth forecast would have been 3.5%. Whereas spending growth is set to decline in most regions, the analysts see a slight increase in Western Europe. Despite the adverse economic outlook, there are still strategic IT initiatives in this region. For the coming year, growth in global IT spending is expected to pick up again and reach 4.1%. In its banking industry survey of 16 July 2013, Gartner expects growth in IT spending to exceed the general market level at 2.5% for the current year.

In the second quarter, the market researchers of IDC also downgraded their 5.5% forecast for global IT spending made at the beginning of the year. In their forecast update of 15 May 2013, they now predict an increase in IT expenditure of 4.9%. In addition to the ongoing global uncertainty regarding future economic development, the IDC experts also foresee falling demand for IT hardware. According to IDC, however, demand for IT services will remain strong.

The industry association BITKOM believes that the hightech industry will continue to be an important driver of the global economy in 2013. According to its latest economic outlook of 4 March 2013, the global market for products and services in the IT and telecommunication sector is expected to grow this year by 5.1% to €2.7 trillion. With a share of 21.8% and expected growth of 0.9%, the EU is still the second-largest ICT market after the USA with growth of 6.5% and a share of 26.8%.

In Germany, BITKOM believes that the German ICT market will easily outpace the overall economy again with growth of 1.4% to €153 billion. According to the BITKOM forecast, the IT services business (projects, consulting and outsourcing) will grow by 2.5% to around €36 billion in the current year, following growth of 2.1% in the previous year. Following a strong first half-year, the German hightech industry is confident about its prospects for the remaining months. According to the sector barometer of 15 July 2013, around three quarters of all suppliers of information technology, telecommunication and entertainment electronics expect rising revenues in the six months ahead.

Revenue and earnings forecast

Following a first six months in line with expectations, the GFT Group is upholding its positive assessment of business prospects for the financial year 2013 – in spite of the eurozone's continuing weakness. Due to the acquisition of a leading Italian IT service provider, the Executive Board has raised its forecast for revenue and earnings for 2013 as a whole.

The GFT Solutions division is dedicated to delivering IT solutions for the finance sector and the Executive Board expects further solid organic growth for this business in the remaining six months, as well as a strong growth impetus from the acquisition of the Italian company Sempla. As of the second half of 2013, GFT Solutions will be present in Europe's fourth-largest IT market with some 500 employees, offering its extended portfolio of solutions to existing and new clients on the Italian market. GFT Solutions expects further growth opportunities from the positioning of selected competencies of Sempla – especially its expertise in general banking – with its European clients.

In the second half of 2013, demand for IT solutions to optimise core banking systems and implement new compliance regulations in the banking sector will continue to rise. One key driver will be the introduction of the single Euro Payments Area (sEPA), which according to Eu ordinance must have been completed by 1 february 2014. further growth is expected to arise from increased competition in the fi nance sector. Established banks will face the challenge of adapting their business models to new technologic al developments. The Executive Board therefore expects banks to invest increasingly in new technologies for mobile payments and to use social media functionalities in the banking business. In the fi eld of mobile banking, fi nancial institutes will invest increasingly in intelligent and userfriendly security solutions. further growth opportunities will arise from the acquired consulting expertise and expanded solution portfolio in general banking of sempla.

The emagine division will continue to drive its realignment as an expert for staffi ng technology projects with IT and engineering specialists in 2013. The division is focusing on those growth industries in germany, france and the uK which are expected to profi t most from an economic upturn in the coming years. In the fi eld of IT, emagine will concentrate on future topics and technology trends such as Big Data, Business Intelligence, social Media, IT security and Mobile Technologies, in order to tap new growth fi elds. In the fi eld of engineering, emagine expects growth to be driven by a rising demand for highly skilled engineers in the fi eld of plant and machine construction, as well as renewable energies. In the current fi nancial year, emagine will not be able to fully compensate for revenue losses from the further reduction of its low-margin Third Party Management business. In 2013, the emagine division will also be burdened by costs for repositioning business under its own brand and for the realignment of its internal structures.

following the scheduled progress of business in the fi rst half of the year, the Executive Board raised its revenue forecast for the fi nancial year 2013 from €238 million to at least €260 million with the announcement of the sempla acquisition on 30 May 2013. The Executive Board now expects earnings before taxes (EBT) to reach at least €15 million (formerly €12 to €13 million). Earnings before interest, taxes, depreciation and amortisation (EBITDA) are expected to reach at least €19 million. for the fi nancial year 2015, the Executive Board continues to expect group revenue of around €400 million and an operating pre-tax profi t margin of over 6%. The underlying business plan assumes steady organic growth in combination with targeted acquisitions in both business divisions.

Stuttgart, 6 August 2013

gfT Technologies Aktiengesellschaft

The Executive Board

Chairman of the Executive Board

Ulrich Dietz Jean-François Bodin Marika Lulay Dr. Jochen Ruetz Member of the

Executive Board

Member of the Executive Board

Member of the Executive Board

Consolidated Income Statement

for the period from 1 January to 30 June 2013, IFRS GFT Technologies Aktiengesellschaft, Stuttgart (not certified)

	Half-year		Second quarter
€	01/01/– 30/06/2013	01/01/– 30/06/2012	01/04/– 30/06/2013	01/04/– 30/06/2012
Revenue	114,187,567.49	116,382,223.48	58,677,211.51	58,732,695.09
Other operating income	2,419,032.24	1,459,466.23	1,411,855.00	475,306.04
	116,606,599.73	117,841,689.71	60,089,066.51	59,208,001.13
Costs of purchased services	48,551,814.16	54,990,146.54	24,338,538.58	27,520,553.68
Personnel expenses:
a) Salaries and wages	40,763,972.68	39,095,860.22	21,249,425.92	19,491,095.98
b) Social security and expenditures for retirement pensions	8,100,583.85	7,321,879.99	4,285,749.15	3,697,032.99
	48,864,556.53	46,417,740.21	25,535,175.07	23,188,128.97
Depreciation on non-current intangible assets and of tangible assets	727,098.59	763,090.09	371,509.67	392,554.19
Other operating expenses	12,998,010.60	11,999,147.35	5,880,852.79	5,573,747.07
Result from operating activities	5,465,119.85	3,671,565.52	3,962,990.40	2,533,017.22
Other interest and similar income	213,997.31	238,602.13	119,136.99	107,485.56
Profit share from associates	-1,931.42	-12,310.54	-8,428.54	-15,260.48
Depreciation on securities	105,370.88	0.00	105,370.88	0.00
Interest and similar expenses	72,175.84	115,246.54	16,051.87	112,161.55
Financial result	34,519.17	111,045.05	-10,714.30	-19,936.47
Earnings before taxes	5,499,639.02	3,782,610.57	3,952,276.10	2,513,080.75
Taxes on income and earnings	1,140,375.94	1,422,341.54	735,718.40	778,700.58
Net income	4,359,263.08	2,360,269.03	3,216,557.70	1,734,380.17
Net earnings per share – undiluted	0.17	0.09	0.12	0.07
Net earnings per share – diluted	0.17	0.09	0.12	0.07

Consolidated Statement of comprehensive INCOME

for the period from 1 January to 30 June 2013, IFRS GFT Technologies Aktiengesellschaft, Stuttgart (not certified)

	Half-year		Second quarter
€	01/01/– 30/06/2013	01/01/– 30/06/2012	01/04/– 30/06/2013	01/04/– 30/06/2012
Net income	4,359,263.08	2,360,269.03	3,216,557.70	1,734,380.17
A.) Components never reclassified to the income statement
Actuarial gains/losses	0.00	-814,216.85	0.00	-408,661.30
Income taxes on components of other result	0.00	225,344.94	0.00	111,789.39
Other (partial) result A.)	0.00	-588,871.91	0.00	-296,871.91
B.) Components that can be reclassified to the income statement
Financial assets available for sale (securities):
– Change of fair value recognised in
equity during the financial year	302,316.16	72,770.75	301,817.54	-186,957.03
	302,316.16	72,770.75	301,817.54	-186,957.03
Exchange differences on translating foreign operations:
– Profits/losses during the financial year	-229,881.24	366,860.49	-278,476.88	324,286.22
	-229,881.24	366,860.49	-278,476.88	324,286.22
Income taxes on components of other result	-69,389.21	0.00	-69,249.59	0.00
Other (partial) result B.)	3,045.71	439,631.24	-45,908.93	137,329.19
Other result	3,045.71	-149,240.67	-45,908.93	-159,542.72
Total result	4,362,308.79	2,211,028.36	3,170,648.77	1,574,837.45

Consolidated Balance Sheet

as at 30 June 2013, IFRS

GFT Technologies Aktiengesellschaft, Stuttgart (not certified)

Assets

€	30/06/2013	31/12/2012 adjusted*
Non-current assets
Intangible assets	638,035.70	737,212.65
Goodwill	35,836,429.16	35,949,217.28
Tangible assets	5,408,720.97	3,208,376.73
Securities	118,130.45	3,189,680.45
Financial assets, accounted for using the equity method	28,259.90	30,191.32
Other financial assets	608,660.88	410,502.75
Current tax assets	415,212.93	415,212.93
Deferred tax assets	4,961,584.85	4,231,941.18
	48,015,097.84	48,172,335.29
Current assets
Trade receivables	54,409,484.07	44,206,480.67
Securities	1,120,000.00	1,316,100.00
Current tax assets	1,007,274.92	918,103.24
Cash and cash equivalents	26,472,302.14	35,911,786.55
Others	790,128.73	416,363.25
Other assets	1,741,814.06	1,542,577.73
	85,541,003.92	84,311,411.44
	133,556,101.76	132,483,746.73

* We refer to Note 1 of the Consolidated Interim Financial Statements.

Shareholders' Equity and Liabilities

€	30/06/2013	31/12/2012 adjusted*
Shareholders' equity
Share capital	26,325,946.00	26,325,946.00
Capital reserve	42,147,782.15	42,147,782.15
Retained earnings	15,243,349.97	15,243,349.97
Changes in equity not affecting net income
Actuarial gains/losses	-1,864,860.99	-1,891,432.39
Foreign currency translations	349,061.86	578,943.10
Reserve of market assessment for securities	-130,896.00	-363,822.95
Consolidated balance sheet loss	-3,416,976.05	-3,827,347.23
	78,653,406.94	78,213,418.65
Liabilities
Non-current liabilities
Provisions for pensions	3,812,799.70	3,687,637.36
Other provisions	2,181,945.68	2,934,677.79
Deferred tax liabilities	340,639.20	593,418.42
	6,335,384.58	7,215,733.57
Current liabilities
Other provisions	18,244,794.36	18,089,885.88
Current income tax liabilities	2,039,459.65	752,481.50
Financial liabilities	2,595,562.47	0.00
Trade payables	16,689,891.73	19,834,818.88
Other financial liabilities	675,940.55	685,418.71
Other liabilities	8,321,661.48	7,691,989.54
	48,567,310.24	47,054,594.51
	133,556,101.76	132,483,746.73

* We refer to Note 1 of the Consolidated Interim Financial Statements.

Consolidated Statement of Changes in Equity

as at 30 June 2013, IFRS GFT Technologies Aktiengesellschaft, Stuttgart (not certified)

€	Notes	Subscribed capital	Capital reserve	Retained earnings
				Other
				retained earnings
As at 01/01/2012	3	26,325,946.00	42,147,782.15	12,743,349.95
Retroactive adjustment acc. to IAS 19R	1
Adjusted amount 01/01/2012		26,325,946.00	42,147,782.15	12,743,349.95
Retroactive adjustment acc. to IAS 19R
Dividend payment May 2012	3
Total income and expenses for the period 01/01/–30/06/2012
As at 30/06/2012		26,325,946.00	42,147,782.15	12,743,349.95
As at 01/01/2013	3	26,325,946.00	42,147,782.15	15,243,349.97
Retroactive adjustment acc. to IAS 19R
Adjusted amount 01/01/2013		26,325,946.00	42,147,782.15	15,243,349.97
Effects from IAS 19R	1
Dividend payment May 2013	3
Total income and expenses for the period 01/01/–30/06/2013
As at 30/06/2013		26,325,946.00	42,147,782.15	15,243,349.97

* Net income

Consolidated Total balance sheet share capital loss -5,713,702.92 75,615,784.46 -720,874.64 -5,713,702.92 74,894,909.82 -588,871.91 -3,948,891.90 -3,948,891.90 2,360,269.03* 2,799,900.27 -7,302,325.79 73,157,046.28 -3,827,347.23 80,104,851.04 0.00 -1,891,432.39	Actuarial gains/losses 0.00 -720,874.64 -720,874.64 -588,871.91		Other result Market assessment for securities -615,885.24 -615,885.24	Foreign currency translations 728,294.52 728,294.52
			72,770.75	366,860.49
	-1,309,746.55		-543,114.49	1,095,155.01
	0.00		-363,822.95	578,943.10
	-1,891,432.39
-3,827,347.23 78,213,418.65	-1,891,432.39		-363,822.95	578,943.10
26,571.40	26,571.40
-3,948,891.90 -3,948,891.90
4,362,308.79		0.00
	0.00 4,359,263.08*		232,926.95	-229,881.24

Consolidated cash flow statement

for the period from 1 January to 30 June 2013, IFRS GFT Technologies Aktiengesellschaft, Stuttgart (not certified)

	Half-year
Notes €	01/01/– 30/06/2013	01/01/– 30/06/2012
Net income	4,359,263.08	2,360,269.03
Taxes on income and earnings	1,140,375.94	1,422,341.54
Interest income	-34,519.17	-110,145.05
Interest paid	-11,144.17	-4,071.58
Income taxes paid	-1,182,937.65	-1,655,063.07
Depreciation on intangible and tangible assets	727,098.59	763,090.09
Changes in provisions	-352,217.80	906,466.68
Other non-cash expenses/income	94,289.10	300,380.06
Profit from the disposal of tangible and intangible assets as well as financial assets	-41,628.72	4,551.00
Changes in trade receivables	-10,426,760.11	-907,531.17
Changes in other assets	-1,770,710.31	-946,453.26
Changes in trade liabilities and other liabilities	-1,331,671.13	-7,688,729.53
Cash flow from operating activities	-8,830,562.35	-5,554,895.26
Cash receipts from sales of tangible assets	7,000.00	0.00
Cash payments to acquire tangible assets	-2,792,829.47	-638,241.00
Cash payments to acquire non-current intangible assets 7	-71,023.10	-162,186.73
Cash receipts from sales of financial assets	3,517,950.00	0.00
Interest received	211,737.56	230,151.55
Cash flow from investing activities	872,834.99	-570,276.18
Cash receipts from taking out short-term or long-term loans	2,595,562.47	464,399.51
Payments to shareholders	-3,948,891.90	-3,948,891.90
Cash flow from financing activities	-1,353,329.43	-3,484,492.39
Effect of exchange rate changes on cash and cash equivalents	-128,427.62	115,493.07
Change in cash funds from cash-relevant transactions	-9,439,484.41	-9,494,170.76
Cash funds at the beginning of the period	35,911,786.55	32,472,593.37
Cash funds at the end of the period	26,472,302.14	22,978,422.61

Notes to the CONSOLIDATED Interim Financial Statements

as at 30 June 2013, IFRS GFT Technologies Aktiengesellschaft, Stuttgart (not certified)

1. Fundamentals for the GFT Group's Interim Financial Statements ······························································································································· ····

These unaudited Interim Financial Statements of GFT Technologies Aktiengesellschaft (GFT AG) and its subsidiaries have been prepared in accordance with section 37w (3) of the German Securities Trading Act (WpHG) and International Accounting Standard (IAS) 34 – Interim Financial Reporting. Compared to the Annual Financial Statements as at 31 December 2012, the Interim Financial Statements include condensed reporting in the Notes to the Financial Statements and comply with the International Reporting Standards (IFRS) as adopted by the European Union.

With the exception of the changes stated below, the same accounting and valuation methods were used in these Interim Financial Statements as in the last Consolidated Financial Statements as at 31 December 2012. New or amended standards and interpretations to be applied as of the beginning of the financial year 2013 had the following impact on the Interim Financial Statements:

In June 2011, the IASB published amendments to IAS 19 »Employee Benefits« which were adopted by the EU in June 2012. Application of the amended standard is mandatory for all financial statements prepared for financial years beginning on or after 1 January 2013, and thus for the first time in the current financial year.

The Group previously recognised pensions and similar obligations according to the corridor approach. With the mandatory adoption of IAS 19 revised as of 2013, the corridor approach is no longer to be used and actuarial gains and losses are now recognised in other comprehensive income.

This leads to an increase in provisions for pensions and similar obligations as well as a decrease in equity.

The Consolidated Income Statement will no longer contain actuarial gains and losses in future as these are now recognised in other comprehensive income.

A further change is the introduction of the net interest rate. Net pension obligations are discounted with the underlying interest rate used for the valuation of gross pension obligations.

Mandatory retrospective application in accordance with IAS 19R has resulted in the following changes to balance sheet items as at 31 December 2012:

Effects on the Consolidated Balance Sheet from the amendment of IAS 19

€ thsd.	31/12/2012	01/01/2012
Equity	1,891.43	-720.87
Pension provisions	2,612.14	996.29
Balance of deferred taxes	-720.71	-275.42

The effects on the Consolidated Income Statement for the first six months of financial year 2012 are only minor. There was no change in earnings per share.

Maintaining the old version of IAS 19 would have resulted in the following changes to the Consolidated Balance Sheet and Consolidated Income Statement:

Effects on the Consolidated Balance Sheet from the maintenance of IAS 19

€ thsd.	30/06/2013
Equity	52.36
Pension provisions	-72.22
Balance of deferred taxes	-19.86

Effects on the Consolidated Income Statement from the maintenance of IAS 19

€ thsd.	30/06/2013
EBT	72.22
Interest result	35.57
Income taxes	9.78
Group result	62.44

There would also have been no change in earnings per share as of the first six months of financial year 2013.

Other comprehensive income was disclosed for the first time according to IAS 1.82A. The effects mainly concerned the disclosure of actuarial gains and losses in other comprehensive income, which are never reclassified to the income statement.

Other new and revised standards to be adopted as of 1 January 2013 (IAS 12/IFRS 7/IFRS 13) have no material impact on the Interim Financial Statements.

In financial year 2012, the structure of the cash flow statement was amended in accordance with IAS 1.41 in order to improve presentation. The amounts for taxes paid and interest paid and received disclosed in the footnotes of the previous year were integrated into the calculation

of the cash flow statement. Moreover, the item »Other changes in equity«, which includes currency translation differences of subsidiaries, was distributed among the changes in assets and liabilities in the reporting period while currency translation differences in cash and cash equivalents were disclosed separately.

In drawing up these Interim Financial Statements, the Executive Board made estimations concerning the application and interpretation of accounting regulations. Actual events may differ from these estimations. Future developments and results depend on a number of external factors involving risks and uncertainties, and are based on current assumptions which may prove inaccurate.

2. Changes to the consolidated Group and its associated companies ······························································································································

The following changes to the scope of consolidation have occurred since the Consolidated Financial Statements were closed on 31 December 2012:

On 26 February 2013, GFT Technologies Aktiengesellschaft, Stuttgart, purchased Neckarsee 283. VV GmbH. On 21 March 2013, the company's name was changed to GFT Beteiligungs-GmbH. Its initial consolidation did not have any major effect on the Group's assets, financial and earnings position.

GFT Holding Italy S.R.L, Milan, Italy, was founded by GFT Technologies Aktiengesellschaft, Stuttgart, on 16 May 2013. The company's share capital amounts to €10 thousand and was fully paid on 6 May 2013. The company's initial consolidation had no material impact on the Group's assets, financial and earnings position.

In the first six months of financial year 2013, the following adjustment was made to the outstanding obligation from the acquisition of GFT Financial Solutions AG, Opfikon, Switzerland, due to a change in the expected value resulting from reduced earnings expectations:

€ thsd.
Carrying value as of 1 January 2013	3,133
Adjustment of conditional consideration	-1,282
Carrying value as of 30 June 2013	1,851

As a consequence, the payment obligation owed to the former shareholders has fallen to €1,851 thousand. The obligation is to be settled in two tranches in the 3rd quarter of 2013 and 2014, respectively.

In the course of the Two Brand Strategy, the following changes to company names were made in January 2013:

• a) emagine GmbH was renamed as emagine TPM GmbH as of 23 January 2013.
• b) GFT Resource Management GmbH was renamed as emagine GmbH as of 13 February 2013.
• c) GFT Flexwork GmbH was renamed as emagine Flexwork GmbH was renamed as of 11 January 2013.
• d) GFT Technologies S.A.R.L. was renamed as emagine S.A.R.L. as of 8 January 2013.

The registered office and purpose of the companies did not change as a result of the name changes.

In accordance with the merger agreement of 22 April 2013, emagine TPM GmbH, Eschborn, was merged with emagine GmbH, Eschborn, with effect from 26 June 2013. The merger had no effect on the Group's assets, financial and earnings position.

3. Changes in equity ······························································································································· ······························································································································· ·······

For the changes in equity capital between 1 January 2013 and 30 June 2013, we refer to the Consolidated Statement of Changes in Equity which is disclosed separately.

As of 30 June 2013, the Company's share capital of €26,325,946.00 consists of 26,325,946 non-par value individual share certificates (no change relative to 31 December 2012). These shares are bearer shares and all grant equal rights.

In June 2012, a dividend of €0.15 per share was distributed to shareholders, totalling €3,949 thousand, from the balance sheet profit of

the parent company GFT Technologies Aktiengesellschaft. In accordance with the adopted resolution of the Annual General Meeting of 15 May 2013, a dividend of €0.15 per share was distributed to shareholders, totalling €3,949 thousand, from the balance sheet profit of the parent company GFT Technologies Aktiengesellschaft.

There were no changes in Authorised Capital or Conditional Capital in the period 1 January 2013 to 30 June 2013 compared to 31 December 2012. As of 30 June 2013, GFT Technologies Aktiengesellschaft did not hold any of its own shares, nor did it purchase or sell any of its own shares in the period 1 January 2013 to 30 June 2013.

4. Segment reporting ······························································································································· ······························································································································· ·····

GFT has identified the two segments GFT Solutions and emagine as reportable segments. The identification of these segments was mainly based on the fact that the products and services offered in these segments show differences, and that the GFT Group is organised, managed and controlled on the basis of these segments. Internal reporting to the Executive Board is based on the classification of Group activities in these segments.

The products and services with which the reportable segments generate their income can be characterised as follows: all activities in connection with IT solutions (services and projects) are aggregated in the GFT Solutions segment. The emagine segment focuses on the placement of freelance IT specialists.

Internal controlling and reporting within the GFT Group, and thus also segment reporting, is based on IFRS accounting principles as applied in the Consolidated Financial Statements. The GFT Group measures the success of its segments by means of segment EBT (earnings before tax). Segment income and results also include transactions between the segments. Intersegment transactions take place at market prices on an arm's length principle.

As a general rule, the assets of the segments include all assets, except for those from income tax and assets attributed to the holding activity. The segment liabilities include all liabilities, except for those from income tax, financing, and liabilities in connection with the holding activity.

For detailed information about the business segments, please refer to the following table. It also includes disclosures concerning revenue from external clients for each group of comparable products and services.

information on business segments – Segment report

GFT Technologies Aktiengesellschaft, Stuttgart (not certified)

	GFT Solutions		emagine
€ thsd.	30/06/2013	30/06/2012	30/06/2013	30/06/2012
External sales	69,137	60,849	45,035	55,533
Inter-segment sales	295	13	642	2,288
Total revenues	69,432	60,862	45,677	57,821
Scheduled depreciation	-582	-578	-90	-158
Significant non-cash income/expenditure other than depreciation	-58	-32	0	0
Interest income	53	47	1	2
Interest expenses	-63	-70	-13	-13
Share of net profits of associated companies
reported according to the equity method	-2	-13	0	0
Segment result (EBT)	6,928	4,252	3	1,146
Segment assets	90,864	77,827	31,861	38,748
Shares in associated companies reported according to the equity method	28	34	0	0
Investments in non-current intangible and tangible assets	872	684	13	91
Segment liabilities	29,630	29,752	18,104	24,936

emagine Total Eliminations Consolidated
30/06/2012 30/06/2013 30/06/2012 30/06/2013 30/06/2012 30/06/2013 30/06/2012 30/06/2013 30/06/2012
60,849 45,035 55,533 114,172 116,382 16 0 114,188 116,382
642 2,288 937 2,301 -937 -2,301 0
57,821 115,109 118,683 -921 -2,301 114,188 116,382
-672 -736 -55 -27 -727 -763
-58 -32 -36 -268 -94 -300
2 54 49 160 190 214 239
-76 -83 4 -32 -72 -115
-2 -13 0 0 -2
6,931 5,398 -1,431 -1,615 5,500 3,783
38,748 122,725 116,575 10,831 14,138 133,556 130,713
0 28 34 0 0 28
885 775 1,978 25 2,864 800
47,734 54,688 7,169 2,868 54,903 57,556

Consolidated			Eliminations		Total
30/06/2013 30/06/2012		30/06/2012	30/06/2013	30/06/2012	30/06/2013
114,188 116,382	0		16	116,382	114,172
0		-2,301	-937	2,301	937
114,188 116,382		-2,301	-921	118,683	115,109
-727	-27		-55	-736	-672
-94		-268	-36	-32	-58
214		190	160	49	54
-72	-32		4	-83	-76
-2	0		0	-13	-2
5,500		-1,615	-1,431	5,398	6,931
133,556 130,713		14,138	10,831	116,575	122,725
28	0		0	34	28
2,864	25		1,978	775	885

The reconciliation of the segment figures to the corresponding figures in the Consolidated Financial Statements is as follows:

€ thsd.	01/01/– 31/06/2013	01/01/– 31/06/2012 adjusted*
Total segment revenue	115,109	118,683
Occasionally occurring revenue	16	0
Elimination of intersegment revenue	-937	-2,301
Group revenue	114,188	116,382
Total segment results (EBT)	6,931	5,398
Non-attributed expenses/income of Group HQ	-876	-2,500
Non-attributed income for elimination of interim results	0	876
Other	-555	9
Group result before taxes	5,500	3,783

€ thsd.	30/06/2013	30/06/2012
Total segment assets	122,725	116,575
Non-attributed assets of Group HQ	114	116
Securities	1,238	7,426
Assets from income taxes	6,679	6,447
Other	2,800	149
Group assets	133,556	130,713
Total segment liabilities	47,734	54,688
Non-attributed liabilities of Group HQ	198	322
Liabilities from income taxes	5,272	2,114
Other	1,699	432
Group liabilities	54,903	57,556

* We refer to Note 1 of the Consolidated Interim Financial Statements.

The reconciliation discloses items which per definition are not components of the segments. Non-attributed items of Group HQ, e.g. from centrally managed issues, are also included. Business transactions between the segments are also eliminated in the reconciliation.

Due to reduced earnings expectations for GFT Financial Solutions AG, as described in point 2, the segment liabilities of GFT Solutions were reduced by €1,282 thousand.

The table below shows information according to geographic regions for the GFT Group:

	Revenue from sales to external clients*		Non-current intangible and tangible assets
in € million	01/01/– 30/06/2013	01/01/– 30/06/2012	30/06/2013	30/06/2012
Germany	40.18	44.72	34.84	32.67
UK	25.94	18.11	0.03	0.07
Spain	13.21	13.95	1.35	1.21
France	20.66	19.92	0.08	0.10
USA	4.29	5.96	5.15	5.33
Switzerland	4.37	6.19	0.09	0.38
Other countries	5.54	7.53	0.34	0.29
Total	114.19	116.38	41.88	40.05

* Determined by client location

Revenue from clients who account for more than 10% each of Group revenue is shown below:

	Revenue		is generated	Segments in which this revenue
in € million	01/01/– 30/06/2013	01/01/– 30/06/2012	01/01/– 30/06/2013	01/01/– 30/06/2012
Client 1	44.20	36.26	GFT Solutions, emagine	GFT Solutions, emagine

5. Changes to contingent liabilities ······························································································································· ·····························································································

As of 30 June 2013, there were no significant changes to contingencies and other financial commitments compared to the Consolidated Financial Statements as at 31 December 2012. As at 31 December 2012, there were no contingent receivables.

INFORMATION ON FINANCIAL INSTRUMENTS ACCORDING TO CLASSES

(not certified)

€ thsd. 30/06/2013
		Valued at amortised cost			Valued at fair value	Carrying amount in the balance sheet
		Carrying amount	Fair value	Carrying amount	Fair value Level 1 1 Level 2 2	Level 3 3
Financial assets
Receivables from goods and services rendered	Loans and receivables	49,295	49,295			49,295
Amounts due from customers for construction work	Loans and receivables	5,115	5,115			5,115
Securities held as non-current assets				118	118	118
Fixed-interest securities	Available-for-sale financial assets			0	0	0
Variable-interest securities	Financial assets measured at fair value through profit or loss and classified as such upon initial recognition			118	118
Securities held as current assets				1,120	1,120	1,120
Variable-interest securities	Available-for-sale financial assets			1,120	1,120	1,120
Variable-interest securities	Financial assets measured at fair value through profit or loss and classified as such upon initial recognition			0	0
Cash and cash equivalents	Loans and receivables	26,472	26,472			26,472
Other long-term assets	Loans and receivables	609	609			609
Other short-term assets	Loans and receivables	416	416			416
Total financial assets		81,907	81,907	1,238	1,238	83,145
Loans and receivables
Available-for-sale financial assets				1,120	1,120	1,120
Financial assets measured at fair value through profit or loss				118	118	118

1 Fair values were measured on the basis of quoted prices (unadjusted) in active markets for identical assets or liabilities.

2 Fair values were measured on the basis of inputs other than quoted prices included within level 1 that are observable for the asset or liability, either directly (i.e. as prices) or indirectly (i.e. derived from prices).

3 Fair values were measured on the basis of inputs for the asset or liability that are not based on observable market data (unobservable inputs).

€ thsd. 30/06/2013 31/12/2012 Valued at amortised cost Valued at fair value Carrying amount in the balance sheet Fair value Carrying amount Fair value Carrying amount Fair value Level 1¹ Level 2² Level 3³ Level 1¹ Level 2² Level 3³ Loans and receivables 49,295 49,295 49,295 40,351 40,351 40,351 Loans and receivables 5,115 5,115 5,115 3,855 3,855 3,855 Securities held as non-current assets 118 118 118 3,189 3,189 3,189 3,071 3,071 3,071 118 118 118 118 118 Securities held as current assets 1,120 1,120 1,120 1,316 1,316 1,316 1,120 1,120 1,120 861 861 861 0 0 455 455 455 Cash and cash equivalents Loans and receivables 26,472 26,472 26,472 35,912 35,912 35,912 Other long-term assets Loans and receivables 609 609 609 411 411 411 Other short-term assets Loans and receivables 416 416 416 416 416 416 Total financial assets 81,907 81,907 1,238 1,238 83,145 80,945 80,945 4,505 4,505 85,450 Available-for-sale financial assets 1,120 1,120 1,120 3,932 3,932 3,932 118 118 118 573 573 573

€ thsd.			30/06/2013
		Valued at amortised cost			Valued at fair value	Carrying amount in the balance sheet
		Carrying amount	Fair value	Carrying amount	Fair value
					Level 1 1 Level 2 2 Level 3 3
Financial liabilities
Financial liabilities	Financial liabilities valued at amortised cost	2,596	2,596			2,596
Trade liabilities	Valued at amortised cost	16,690	16,690			16,690
Other liabilities	Valued at amortised cost	676	676			676
Financial liabilities from subsequent purchase price payments	Valued at amortised cost	2,209	2,209			2,209
Total financial liabilities		22,171	22,171			22,171
Financial liabilities valued at amortised cost		22,171	22,171			22,171

1 Fair values were measured on the basis of quoted prices (unadjusted) in active markets for identical assets or liabilities.

2 Fair values were measured on the basis of inputs other than quoted prices included within level 1 that are observable for the asset or liability, either directly (i.e. as prices) or indirectly (i.e. derived from prices).

3 Fair values were measured on the basis of inputs for the asset or liability that are not based on observable market data (unobservable inputs).

➜	❘	Notes
			33

30/06/2013 31/12/2012
Valued at Valued at fair value Carrying Valued at Valued at fair value Carrying amortised cost amount in amortised cost amount in the balance the balance sheet	sheet
Carrying Fair Carrying Fair value Carrying Fair Carrying Fair value amount value amount amount value amount
Level 1 1 Level 2 2 Level 3 3 Level 1 1 Level 2 2 Level 3 3
Financial liabilities valued 2,596 2,596 2,596 0 0 at amortised cost	0
Valued at amortised cost 16,690 16,690 16,690 19,835 19,835 19,835
Valued at amortised cost 676 676 676 685 685	685
Valued at amortised cost 2,209 2,209 2,209 3,671 3,671	3,671
22,171 22,171 22,171 24,191 24,191 24,191
22,171 22,171 22,171 24,191 24,191 24,191

6. Reporting on financial instruments ······························································································································· ······················································································

Information on financial instruments according to categories

The table on pages 30–33 of the Notes to the Interim Financial Statements show the carrying amounts and the fair value of the individual financial assets and liabilities for each individual class of financial instruments, and transfers them to the corresponding balance sheet items.

The fair value of a financial instrument is the price at which a party would take on the rights and/or obligations from this financial instrument from an independent, contractually-willing other party.

In the case of financial instruments to be accounted for at fair value, the fair value is determined on the basis of market prices. If no market prices are available, a valuation is carried out using typical valuation methods based on instrument-specific market parameters.

The fair value of loans and receivables and of original liabilities is determined as the present value of future cash inflows or outflows, discounted at a current interest rate on the balance sheet date taking into account the respective due date of the asset items or the residual term of the liability. Owing to the mainly short maturity term of trade payables and receivables, other receivables and liabilities and cash and cash equivalents,

the carrying amounts on the balance sheet date do not vary significantly from the fair value.

Financial instruments stated in the balance sheet at fair value can be classified according to the following hierarchy which reflects to which extent the fair value is observable:

Level 1: measurement at fair value on the basis of quoted prices (unadjusted) in active markets for identical assets or liabilities.

Level 2: measurement at fair value using inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly (i.e. as prices) or indirectly (i.e. derived from prices).

Level 3: measurement at fair value based on inputs for the asset or liability that are not based on observable market data (unobservable inputs).

Quantitative disclosures for financial instruments stated in the balance sheet at fair value are included in the table on pages 30–33 of the Notes to the Interim Financial Statements.

As in the previous period, no reclassifications between the three levels were made during the current financial year.

7. Investments/disinvestments ······························································································································· ·········································································································

During the period 1 January to 30 June 2013, the GFT Group invested €71 thousand in intangible assets (1 January – 30 June 2012: €162 thousand) and €2,793 thousand in tangible assets (1 January – 30 June 2012: €638 thousand). There were no significant disinvestments in the reporting period. Additions to non-current tangible assets mainly refer to the purchase of an administration building totalling €1,950 thousand.

8. Related party disclosures ······························································································································ ···················································································································

Compared to the disclosures made in the Notes to the Consolidated financial statements as at 31 December 2012, there were no signifi cant changes in related party disclosures. There were also no changes in the composition of related parties nor in relations with such parties.

9. Events after 30 June 2013 ······························································································································ ·················································································································

In an agreement dated 30 May 2013, gfT holding Italy s.R.l., Milan, Italy, acquired an 80% stake in the Italian IT service provider sempla s.R.l., Milan, Italy, for a purchase price of €21,080 thousand. The acquisition of the company was closed on 3 July 2013 and gfT holding Italy s.R.l., Milan, Italy, has controlled the acquired company since this date.

gfT holding Italy s.R.l., Milan, Italy, has agreed a put and call option for the acquisition of the remaining 20%.

The main motivation for the acquisition was to strengthen the position of gfT as an IT specialist for banks and to add high-quality consulting expertise on the Italian market. further reasons included:

• a) The high level of skill and motivation of employees at sempla s.R.l.
• b) Expected synergies between gfT and sempla s.R.l. in the joint tapping of customers on the Italian market
• c) Positioning of selected expertise of sempla s.R.l. among European clients of the gfT group (credit products)

In total, the acquisition is intended to drive the continued internationalisation of the gfT group.

Due to the proximity of the acquisition and the reporting date, the disclosures required by IfRs 3 B 64(f)-(o), (q) in conjunction with IfRs 3 B 66 could not be made as there was not yet any opening balance sheet nor purchase price allocation.

Stuttgart, 6 August 2013

gfT Technologies Aktiengesellschaft

The Executive Board

(Chairman)

Executive Board Executive Board Executive Board Executive Board

Ulrich Dietz Jean-François Bodin Marika Lulay Dr. Jochen Ruetz

To the best of our knowledge, and in accordance with the applicable reporting principles, the Interim Consolidated financial statements give a true and fair view of the assets, liabilities, fi nancial position and profi t or loss of the group, and the Interim group Management Report 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 fi scal year 2013.

Stuttgart, 6 August 2013

gfT Technologies Aktiengesellschaft

The Executive Board

(Chairman)

Ulrich Dietz Jean-François Bodin Marika Lulay Dr. Jochen Ruetz Executive Board Executive Board Executive Board Executive Board

Review report

To GFT Technologies AG, Stuttgart

We have reviewed the condensed interim consolidated financial statements of the GFT Technologies AG, Stuttgart, – comprising the consolidated income statement, consolidated statement of comprehensive income, consolidated balance sheet, consolidated statement of changes in equity, consolidated cash flow statement and the notes – together with the interim Group management report of the GFT Technologies AG, for the period from January 1 to June 30, 2013 that are part of the semi annual according to § 37 w (or § 37 x Abs. 3) WpHG [»Wertpapierhandelsgesetz«: »German Securities Trading Act«]. The preparation of the condensed interim consolidated financial statements in accordance with those IFRS applicable to interim financial reporting as adopted by the EU, and of the interim Group management report in accordance with the requirements of the WpHG applicable to interim group management reports, is the responsibility of the Company's management. Our responsibility is to issue a report on the condensed interim consolidated financial statements and on the interim Group management report based on our review.

We performed our review of the condensed interim consolidated financial statements and the interim Group management report in accordance with the German generally accepted standards for the review of financial statements promulgated by the Institut der Wirtschaftsprüfer (IDW). Those standards require that we plan and perform the review so that we can preclude through critical evaluation, with a certain level of assurance, that the condensed interim consolidated financial statements have not been prepared, in material respects, in accordance with the IFRS applicable to interim financial reporting as adopted by the EU, and that the interim Group management report has not been prepared, in material respects, in accordance with the requirements of the WpHG applicable to interim group management reports. A review is limited primarily to inquiries of company employees and analytical assessments and therefore does not provide the assurance attainable in a financial statement audit. Since, in accordance with our engagement, we have not performed a financial statement audit, we cannot issue an auditor's report.

Based on our review, no matters have come to our attention that cause us to presume that the condensed interim consolidated financial statements have not been prepared, in material respects, in accordance with the IFRS applicable to interim financial reporting as adopted by the EU, or that the interim Group management report has not been prepared, in material respects, in accordance with the requirements of the WpHG applicable to interim group management reports.

Stuttgart, 6 August 2013

KPMG AG

Wirtschaftsprüfungsgesellschaft

Schwebler	Bauer
Auditor	Auditor

Financial Calendar

Züricher Kapitalmarkt Konferenz, Zürich 5 September 2013

German Mittelstand Conference, New York 1 October 2013

Quarterly Financial Report as of 30 September 2013 7 November 2013

Deutsches Eigenkapitalforum, Frankfurt/Main 11–13 November 2013

LBBW German Company Day, London 14 November 2013

Further INFORMATION

Write to us or call us if you have any questions. Our Investor Relations team will be happy to answer them for you. Or visit our website at www.gft.com/ir. There you can find further information on our company and the GFT share.

GFT Technologies Aktiengesellschaft

Investor Relations Andrea Wlcek

Filderhauptstrasse 142 70599 Stuttgart Germany T +49 711 62042-440

F +49 711 62042-301

ir@gft.com

This Half-Yearly Report is also available in German. The online versions of the German and English Interim Reports are available on www.gft.com/ir.

IMPRINT

Concept: GFT Technologies Aktiengesellschaft, Stuttgart, www.gft.com

Text: GFT Technologies Aktiengesellschaft, Stuttgart, www.gft.com

Creative concept and design: Impacct Communication GmbH, Hamburg, www.impacct.de

© Coypright 2013: GFT Technologies Aktiengesellschaft, Stuttgart