9-Month Report 2009

Overview of Group Results

in EUR million	Jan. 1 to Sept. 30, 2009	Jan. 1 to Sept. 30, 2008
Revenues	46.73	159.10
Total operating revenues	59.14	162.11
EBIT	–16.09	18.77
EBIT margin [in %]	–	11.8
EBT	–14.39	18.53
Consolidated operating profit	–11.53	14.09
Earnings per share	–2.45	3.52
Operating cash flow	–4.4	–4.6
Equity ratio [in %]	80.2	71.8
Net debt	–41.36	–31.76

to our shareholders

02 | Letter to the Shareholders

08 | Manz Automation AG Shares

Group Interim Report

12 | Business Report
36 | Events After the Balance Sheet Date
38 | Risk analysis and forecast

Consolidated Interim Financial Statements & Notes

48 | Consolidated Interim Financial Statements

54 | notes to the consolidated interim financial statements

Letter to the shareholders

Dear Shareholders,

while the first half of 2009 was characterized by a number of challenges for both the solar industry and the engineering sector as a whole, we finally saw positive indicators over the summer that pointed toward a slight recovery. For instance, the number of enquiries from potential clients increased, and we were given the green light to begin working on many projects which had previously been postponed by clients. The main reason for this improvement was the significant reduction, also for end customers, in the market price of solar modules during the first half of the year, which meant that investing in solar energy became attractive once again.

Unfortunately, since the demand for new and replacement investments remains dampened, this improved outlook was not reflected in our revenues and profits. Thus, in the first nine months of the year, we generated revenues of 46.73 million euros after generating 159.10 million euros in the same period last year. This corresponds to a year-over-year decline of 70.6%. With regard to earnings before interest and taxes [EBIT], we recorded a loss of 16.09 million euros. During the same period last year, we generated an operating profit of 18.77 million euros. At the end of the day, our consolidated loss totaled –11.53 million euros through the first nine months of this year [after posting a consolidated profit of 14.09 million euros through the same period last year].

The reasons for this loss can partly be traced back to the strategic, targeted investments we made in research and development activities in order to launch new, innovative products. Our goals are clearly defined: once the financial crisis has been overcome, we want to retain our position as the market's technological leader, further expand our position, and benefit from a rebound in the solar industry. To achieve these goals, we have focused our activities at this stage on further optimizing processes, increasing the speed of our machines, and improving the efficiency of solar cells and modules. This will allow us to cut manufacturing costs for our clients while, at the same time, improving performance. This is a fundamental requirement for the solar industry to become competitive with conventional sources of energy over the next few years. As a leading equipment supplier, we can benefit from this trend.

Our research and development activities have already paid off: at the most important industry trade show, the "24th European Photovoltaic Solar Energy Conference and Exhibition" [EU PVSEC], we saw an increased demand for our products. At this trade show, we acquired orders and letters of intent valued at over five million euros – the majority of which will be reflected in our revenues and profits in the coming fiscal year. Our engineers have developed machines which set new standards for efficiency and seamless integration, thus creating the technological basis for further expanding our competitive position.

But our research and development activities are not strictly limited to the solar industry. The systems.lcd division is already enjoying a new market upturn due to the increased demand for televisions – most notably from China – which is the reason why our manufacturing facilities in Asia are once again working at full capacity. In addition, we are also benefiting from the reduced cost pressure and the related economies of scale which must be utilized in this industry.

As a result of our company's international orientation and the ability of our subsidiaries [such as Manz Automation Slovakia] to conduct business on behalf of third parties, their capacities are also once again being utilized to handle orders from the semicondutor industry. Due to the transfer of technology which took place within the Group, we were also able to further expand our operations in the area of lithiumion batteries [li-ion batteries] for electric-powered transportation. The initial contract we received valued at two million euros has since been completed. At the same time, the follow-up order to develop new efficient manufacturing technolgies for li-ion batteries opens up growth opportunities in another emerging market. We firmly believe that we will be able to expand our activities in the field of li-ion batteries into a new division of our company in the coming fiscal year. In doing so, we are creating an even wider foundation for our business model.

Despite these positive developments, the market's decline during the first half of the year still made it necessary to adjust our capacities in order to cut costs. For this reason, we adjusted our workforce at our manufacturing facilities in Taiwan and China, and extended the shorttime work at our German facilities in Reutlingen und Tuebingen until June of 2010. Working hours are currently at levels between 60% and 80%, depending on the department. However, our company plans on retaining the current level of personnel in order to fully satisfy the increase in demand which we expect once the current crisis ends. If, contrary to our expectations, the overall outlook and the number of new orders we receive does not improve significantly by the middle of 2010, we will be forced to avail ourselves of further tactics to cut costs.

However, we remain confident that we will come out of the economic crisis stronger than before. On the one hand, we reacted quickly to changes in the market. On the other hand, we have a strong equity ratio of approximately 80%, liquid assets totaling 54 million euros, and extensive, unused lines of credit – all of which give us ample room to maneuver. Our current strategy is to establish the basis from which we will once again drive innovation as a provider of leading automation and system solutions for both the solar industry and new growth industries once the crisis is over.

Because a recovery did not take effect in the second half of 2009, it is unrealistic to expect that Manz Automation will be able to post a profit for the year. As of September 30, 2009, our company has a current order volume valued at 78 million euros. As a result, the Managing Board anticipates revenues for the 2009 fiscal year to total between 80 and 85 million euros. In addition, the Managing Board expects to post a positive EBIT for the fourth quarter, without being able to compensate for the losses accrued during the rest of the year, however.

We would like to thank our shareholders, clients, and employees for continuing to place their confidence in us, even during such difficult economic times.

The Managing Board

Dieter Manz Martin Hipp Volker Renz Chairman of the Managing Board

Martin Hipp Volker Renz Dieter Manz

Manz automation AG shares

2009 / 2010 Financial Calendar

Date
Nov. 10, 2009	2009 German Equity Forum
Mar. 30, 2010	2009 Annual Report
May 11, 2010	3-Month Report 2010
Jun. 22, 2010	2010 Annual Meeting of Shareholders
Aug. 10, 2010	Semi-Annual Report 2010
Nov. 08, 2010	9-Month Report 2010

Key Data

German Securities Code Number	A0JQ5U
ISIN /symbol	DE000A0JQ5U3/M5Z
Stock market segment /stock exchange	Prime Standard / Frankfurt
Stock category	No-par-value bearer shares each with a proportionate interest of 1.00 euros in the share capital
Share capital	4,480,054 euros
Number of shares in circulation	4,480,054

The price of Manz Automation shares improved parallel to the TecDAX during the previous months, although it did fluctuate more than the index itself. Manz shares performed significantly better than the Prime IG Renewable Energies Index [ISIN DE0007237810], particularly near the end of the quarter. As a result of an improvement in the overall market, the share price which had declined steadily up until that point began to increase in March after reaching a low of 22.26 euros [March 3, 2009]. The share price reached its highest point this year – 59.97 euros, on September 18, 2009 – which is equal to an increase of almost 170% from its low.

At the end of the third quarter on September 30, 2009, the company's market capitalization totaled 242.7 million euros.

shareholder structure as of sEPTEMBER 30, 2009

>> shareholder structure

Currently at 50.81%, Manz Automation has a high number of shares in free float and a wide shareholder base. In addition, the founder and chairman of the Managing Board, Mr. Dieter Manz, holds 44.49% of shares at the end of the third quarter on September 30, 2009. In addition, Ulrike Manz owns another 4.70% of Manz Automation AG shares.

business report

Market Environment AND COMPANY POSITION

>> Market and Competitive Environment >>> Economic Environment

The third quarter of the 2009 fiscal year was characterized by the continuing economic crisis, although for the first time a slight improvement was seen. Leading economic research institutes presented the same findings to the federal government in their fall report. According to their findings, the German economy stabilized earlier than the economists were expecting back in the spring. It is assumed that the primary reason for this speedy improvement was the quick reaction by central banks and governments around the world to make the necessary changes to monetary and fiscal policies.

The experts are expecting a decline of 5.0 % in Germany's gross domestic product [GDP] in 2009. The International Monetary Fund [IMF] has reached a similar conclusion, predicting a decline of 5.3% in its economic report. But the economic researchers predict GDP growth of 1.2% already next year. In this case, the forecast by the IMF is significantly more cautious, predicting growth of only 0.3%. And the effects will not have as significant an impact on the German job market as previously believed.

In contrast, the global economy will initially recover more slowly. In this case, experts are predicting production growth of 2%. In the future, the economic power of emerging markets will see a pronounced increase, while the industrialized countries will only grow by 1% after an estimated decline of 3.5% in 2009. According to the IMF, a sustained recovery in the global economy is dependant on how long the supporting monetary and fiscal policies are maintained, among other things.

According to the Munich-based Ifo Institute for Economic Research, the economic climate index currently stands at its highest point this year. The six-month business outlook of German companies is also at a high for the year. However, the majority of those surveyed still assess the current economic situation as unfavorable.

After reporting on the continued decline in the number of new orders received by mechanical engineering companies over the last few months, the German Engineering Federation [VDMA] now reports that the downward trend is finally over. It is too early, however, to speak of a sustained recovery. Therefore, this figure was effectively 33% lower in September of 2009 than in the same period last year. In the third quarter [July to September 2009], the federation recorded a 40% decline in new orders compared to the same period last year. Within this context, demand from overseas has slightly improved, and now stands at a 39% reduction compared to last year. The situation in Germany is similar, with a year-over-year decline for the quarter of 40%. The VDMA assesses the situation as stabilizing, albeit at a low level.

For the most part, the macroeconomic recovery means positive growth prospects for Manz Automation. As soon as the markets have recovered and the credit crunch has been overcome, we anticipate that the demand for investment goods will once again increase.

>>> systems.solar division

The effects of the global economic crisis are reflected in the significantly decelerated growth in the photovoltaics industry during the current 2009 fiscal year. As a result, the banks' lack of willingness to finance investments has led to a global decline in demand in the photovoltaics market. The market is characterized by the existing credit crunch currently being experienced by solar cell manufacturers and solar park operators, an oversupply of solar cells, and the resulting increased cost pressure felt by manufacturers, as well as more intense competition. Analysts have calculated the oversupply to total approximately 2 GW and the resulting decline in prices for solar modules to reach up to 24% in 2009. [LBBW – Photovoltaics 2009] As a result, solar cell manufacturers are postponing the purchase of new equipment, and only a few new solar parks have been constructed. Consumers are also reluctant to invest in private photovoltaic equipment due to the general uncertainty brought on by the recession. [BSW – Background paper for Intersolar 2009] As a result of the aforementioned situation, the short-term growth perspectives for the solar equipment manufacturing industry have become considerably worse. [LBBW – Photovoltaics 2009] However, according to the latest forecasts by the German Federal Association of the Solar Industry [BSW-Solar], the demand for solar power equipment will grow in a number of important export markets as early as this year. After a weak first half of 2009, a multitude of solar companies are already experiencing a noticeable boom in their business. Thus, the experts predict that the industry will be back on its previous growth course by 2010 at the latest. [BSW – Demand for photo-

voltaics increases once again]

Through the annual degression of subsidies for solar equipment and the attractive returns which can currently be achieved, experts are forecasting a record number of new photovoltaic installations in 2009, despite the current situation. The number of new installations will particularly increase again in the fourth quarter, which means that based on analysts' estimates, new installments in Germany will total 2 GW by the end of the year. [German CleanTech Institute – Tape 1 solar energy] Consumers and institutional investors most likely want to secure the attractive feed-in tariff and interest rates which are extremely low at present. In this case, there will probably be some pull-forward and bandwagon effects, especially with regard to

18 | GROUP Interim REPORT | business REPORT | Market Environment AND COMPANY POSITION

Market and Competitive Environment >>> Systems.solar division

Thin-film products Thin film module price [euro/watt, scale on left] Technology-weighted module price [euro/watt, scale on left] Crystalline module products Crystalline module price [euro/watt, scale on left]

the likely adjustments which will be made to applicable laws. Over the short term, however, this surge in demand will lead to a significant reduction in the existing oversupply, which may cause the industry to stabilize.

Currently, the first politicians are calling for a reduction in solar subsidies. Based on these sentiments, a reduction in the feed-in tariffs can be expected before the dates set forth in the German Renewable Energy Law [EEG] to adjust the tariffs in 2013. The call to reduce the subsidies is based on current technological advances as well as the resulting drastic reduction in manufacturing costs. Thus, the prices for solar modules have fallen so steeply over the past few months that the returns which investors can achieve have risen significantly, despite the reduction in subsidies set forth within the scope of an amended Renewable Energy Law. [Handelsblatt – Boom in the solar energy industry drives electricity prices higher – October 8, 2009]

Based on the views of the solar specialists at the Swiss bank Sarasin, the long-term prospects for renewable energies are particularly positive. An increase in demand as a result of the economic stimulus packages taking effect, combined with a stronger level of commitment from energy providers, will revitalize the market. In addition, experts are sure that the manufacture of renewable energy components will shift regionally to China and the USA. This statement is supported by the extremely ambitious political goals announced by US president Obama regarding climate control, but also by subsidy programs in China. [Bank Sarasin & Cie AG – Sustainability Research]

According to these goals, Obama plans to expand the percentage of energy used in the USA that comes from renewable sources from its current level of 9% to 25%. To achieve this goal, 150 billion dollars will be invested over the next ten years in new technologies with increased energy efficiency. For example, the power supply system in the USA must be improved and expanded. The solar industry can also benefit from these planned investments in infrastructure. As part of his plans to achieve these goals, the US president signed the "American Recovery and Reinvestment Act of 2009," on February 17, 2009, which includes a 30% subsidy for renewable energy. Thus, the analysts from Piper Jaffray predict that the US solar market could double this year to between 600 and 700 MW, and reach the size of the German market with 1.5 to 2 GW as early as 2010. An example of this growth is the 48-megawatt solar power plant being built outside of Las Vegas to be completed by 2010, making it the largest of its kind in North America. Experts in the United States expect new installments to total around 2.6 MW annually beginning in 2013, contingent on subsidies such as the "Investment Tax Credit" [ITC], which would equal an annual growth rate of 50%.

With the China Renewable Energy Scale-up Program [CRESP], which will run for 10-12 years and was launched together with the World Bank, China will play an increasingly more important role in the area of renewable energies. Thus, in the future, solar plants with a capacity of more than 50 KW will be subsidized with USD 2.93 per watt. This plan will primarily benefit the Chinese solar industry. Manz Automation will participate in this subsidy program, since the important Chinese solar manufacturers, Yingli Green Energy and Suntech, are both clients of our company. The latter is working on large projects for various Chinese provinces such as Hainan. Analysts, however, believe that delays in project authorization and the project developers' lack of experience mean that the governmental objective of 2 GW of installed energy will fail to be met. According to the market research institution, GTM Research, an increase to half of the promised goal would be realistic. In addition, the Chinese government has set the goal of installing solar equipment on the rooftops of schools, hospitals, and government buildings. Moreover, the Chinese authorities plan to expand the percentage of energy used that comes from renewable sources to 23% by 2020. This corresponds to an average yearly increase of 6% to 7%. Furthermore, with our own manufacturing and sales facilities in China and Taiwan, Manz Automation is positioned extremely well in the Asian market.

Another new market with significant growth potential is currently developing in India. A total of 19 billion US dollars will be invested in national subsidies for

photovoltaic power. This should result in the creation of a country-wide capacity totaling approximately 20 GW. In addition to an improved position during global climate negotiations, India also plans to reduce its dependence on fossil fuels. It is important to note that more than half of the Indian population does not have access to electricity. For this reason, the subcontinent is primarily interested in the ability to supply energy through a decentralized system, which is made possible using solar equipment. An enormous growth spurt is expected in the coming years as a result of the planned subsidy.

Plans are currently being drawn up for legal regulations, which will set forth the country's goals and activities with regard to solar power. In doing so, the Indian authorities have chosen to base their legislation on the German Renewable Energy Law. The entire project is being guided by the Ministry of New and Renewable Energy, which will be expanded to include a department specifically for solar energy. The local organizations are being supported from Germany by Gesellschaft für Technische Zusammenarbeit [GTZ]. [Solarmedia – India's Billion-Dollar Program – September 10, 2009]

Manz Automation can also benefit from these trends. In order to establish a local solar industry, the first thing needed is state-of-the-art and powerful equipment, equipment such as the products our company offers. Having recognized this need, Manz founded a subsidiary in India in October of 2008. The Manz Group holds a 75% interest in the company, the rest being held by the Indian company Technicom Chemie Ltd. As a result of this joint venture, our company now has direct access to local customers in India, which is an extremely important advantage when competing internationally.

The experts at Sarasin only expect an increase in new photovoltaic installations of 17% in 2009. In fact, they are anticipating a slight decline in Europe, since particularly the outlook in Spain, which is the

Global annual PV market until 2013

second-largest European market [after Germany], has become significantly worse. [Bank Sarasin & Cie AG –

Study: "The solar industry anticipates difficult times ahead," 2008]

In the context of achieving grid parity, however, advancements made to thin-film solar modules must be particularly emphasized, since this technology is rapidly gaining market share. It is characterized by its economical use of the raw material silicon and, as a result, its lower initial acquisition costs. Experts forecast an increase in the market share of thin-film technology from its current level of 12% to 23% by 2012. With regard to the entire global market, Bank Sarasin anticipates growth of 48% by 2020, resulting in 125 GW of power from new installations. [Bank Sarasin & Cie AG – Study: "The solar industry anticipates difficult times ahead," 2008]

the production of thin-film solar modules, the Manz Group has expanded its position as an equipment supplier respected throughout the world. The company is the only supplier outside of Asia with long-term experience in safely handling large glass substrates in cleanroom conditions. Manz has had success in setting internationally accepted standards precisely in this segment, since the company's products combine increases in efficiency as well as significant cost savings. For this reason, Manz Automation offers its clients around the world the ability to meet their increased competitive demands.

the field of LCD production, and with applications for

Manz Automation has positioned itself on the market as a leading supplier of high-quality technological solutions. By successfully combining long-term experience in system solutions for wet chemistry, in

>>> systems.lcd division

LCD market trends are primarily driven by the sale of modern LCD flatscreens. This means declining prices boost the sale of products. At the same time, the old standard CRT television has for the most part been completely pushed off the market by the new technology, which has a much more favorable price to performance ratio. The experts at DisplaySearch had been forecasting a decline in growth in the LCD market as a result of the financial crisis. However, LCD technology is increasingly being chosen over plasma technology for business applications that require a screen size of more than 26 inches. This year, an increase in year-over-year growth of 25% is already expected for large-size LCD televisions with screen sizes above 40 inches. The LCD market is continuing to grow despite the global recession but, at the same time, it is still affected by economic trends. In the future, the size of LCD panels will not increase as greatly as it had before. Nevertheless, there is still a high demand for machines that can move the largest size of glass substrates possible, since they open up important economies of scale for cutting costs.

Industry analysts had already increased their previous forecast of 120 million large-size LCD televisions sold this year to 127 million units, and this estimate has been increased once again up to 130 million units. The People's Republic of China is one of the countries driving this growth. Through subsidy programs for the rural population and a newly developed incentive program for urban citizens, which encourages the purchase of LCD televisions over conventional CRT televisions, the market has grown remarkably. As a result, a 25% increase is being forecast for the Chinese market alone, equal to 23.6 million television units sold.

The advancements to LCD televisions, the spread of HDTV [high-definition television], as well as declining prices for larger units are currently the important factors driving the market as a whole. Experts are seeing a clear trend towards increasingly larger units with more extensive features such as improved frame rates or LED backlighting. The latter innovation is currently boosting sales of state-of-the-art LCD televisions, since, apart from being more energy efficient, these televisions can also display significantly improved black levels. For this reason, manufacturers must invest in manufacturing equipment of the newest generation. As a leading global supplier of equipment for the handling of glass substrates and wet chemical cleaning, Manz Automation will benefit from the current trends in the LCD market.

>>> systems.aico division

In the systems.aico division, our focus is on the use of synergies and economies of scale. Its business objective is the sale of components and systems that have either been developed for the LCD and solar divisions or purchased additionally as components. Using higher purchasing volumes, the company achieves purchasing benefits while simultaneously increasing the return on proprietary developments. In doing so, we serve a number of different sub-segments such as the packaging industry or tool manufacturers. Our relationships with clients that have grown over the course of many years are characterized by their stable and continuous revenue streams. Overall, growth in these sub-segments is influenced by the economic trends and the varying investment cycles in these industries. For this reason, the systems.aico division has a stabilizing effect as compared to the systems.solar and systems.lcd divisions, which are highly dynamic.

In addition to the aforementioned objectives, the systems.aico division serves as a breeding ground for new technologies, which can ultimately lead to the development of new areas of business. That's why our new area of research, li-ion batteries for electricpowered transportation, was initially assigned to this division. Since July of 2009, Manz has participated in an industrial partnership within an "innovation alliance" to carry out "manufacturing research on highperformance li-ion batteries for electric-powered transportation." The goal of this research project is to explore new manufacturing technologies and apply them to the demands of mass production. In order for the market for electric vehicles to succeed, highquality lithium-ion cells, batteries, and battery components must be mass-produced consistently and a sustainable supply chain must be created. Within the scope of this project, both new industrial manufacturing technologies and automation solutions will be pursued, and solutions for system integration and production process planning for battery-cell manufacturers will be developed. Through our participation in this industrial partnership, Manz Automation has created an outstanding initial position from which we can establish ourselves as a long-term leading system supplier in this additional dynamic growth market. Our company firmly believes that we will be able to expand our activities in the field of li-ion batteries into a new division of our company in the coming fiscal year, alongside our LCD, Solar, and Aico divisions.

With the help of the "National Electric-Powered Vehicle Development Plan," the German federal government aims to have at least one million electric and plug-in hybrid vehicles, which can be recharged by connecting them to an external electric power source, on German streets by 2020 at the latest. Within the scope of the second economic recovery package, the German government has set aside a total of 500 million euros for various projects to be carried out from 2009 to 2011 alone. The goal in this case is to position Germany as the leading market for electric-powered transportation.

[Finance – Markets and Opinions: R&D trends: Germany is to become the leading market for electric-powered transportation – October 16, 2009]

Numerous different policies and subsidies now exist in various countries regarding the purchase of electricpowered vehicles. For instance, Spain subsidizes the purchase of an electric-powered vehicle with up to 6,000 euros. In addition, there are other European countries that encourage environmentally conscious buyers to purchase electric-powered vehicles by providing tax breaks or direct subsidies. For example, Great Britain grants tax rebates up to 5,825 euros and Portugal up to 4,500 euros. In Germany, discussions are currently being held regarding assistance totaling 5,000 euros, but up until now nothing has been finalized. [Auto, Motor und Sport: State-Run Subsidy Programs in Europe – October 13, 2009]

Experts forecast one million electric-powered vehicles by 2015 alone, and optimistic estimates even predict approximately five million units by 2020. At the same time, the market for hybrid vehicles, as a first step for automobile manufacturers on the way to an electric future, will grow significantly faster, and based on forecasts will consist of 9 million units by 2020. In the future, other drive technologies will be available in addition to the internal combustion engine such as mild and full hybrid, plug-in solutions [to be connected to a power outlet for recharging], and also battery-powered vehicles with range extenders [A small internal combustion engine that charges the battery in the vehicle. This motor runs in the optimal speed range and is, therefore, significantly more efficient than when used conventionally.]. About 100 battery cells are currently used in electric vehicles [those powered only by an electric motor], based on the current state of technology. These have an extremely small and flat design, which allow them to be built into the vehicles in various ways. With an engine efficiency of up to 90%, electric motors are significantly more efficient than their gas- and dieselpowered equivalents [30% and 40%, respectively]. Furthermore, pollution is reduced when the electricity is generated from renewable energy sources such as solar, wind, or water power. This demonstrates the enormous significance of the relationship between alternative engines and renewable energies. The result for Manz is a significant market potential. From today's perspective, the market volume for the equipment sector over the next five years will total in the upper hundreds of million euros. Manz wants to achieve a share of this market in the high double digits. Beyond that, high-performance batteries can be used as a storage medium in decentralized photovoltaic plants.

In summary, our company views the li-ion battery segment as a highly attractive area of growth which Manz can participate in over the medium term as a result of our extensive research and development expertise.

>> Employees

On September 30, 2009, a total of 1,343 employees [previous year: 1,713] worked for the company both in Germany and abroad, 365 of which were employed at our company's headquarters in Reutlingen.

As the above figures show, the financial crisis also had an impact on the company's workforce. As a result of the economic development, the workforce had to be reduced – primarily abroad. At German locations where the primary focus is on research and development activities, no changes were made to our personnel levels for strategic reasons. However, we switched to shorttime work domestically in May of 2009.

Based on the number of employees, the largest subsidiary in the Manz Group is Intech Machines Co. Ltd. in Taiwan with 505 employees, followed by Manz Automation Slovakia s.r.o with 196 employees, and Manz Tübingen GmbH with 124 employees.

>> Research & Development

Our priorities for fiscal year 2009 are set on research and development activities. Manz will continue on the same course in the coming year in order to reinforce our position as the industry's innovation driver. Our goal is to prepare the company for the coming wave of investments by solar cell manufacturers. In order to do so, we have developed highly efficient and seamlessly integrated machines which will set new standards in the industry. We have already introduced some of our new developments at this year's "24th European Photovoltaic Solar Energy Conference and Exhibition" [EU PVSEC] held in Hamburg in September. With new equipment and system solutions as the result of our intensive research and development activities, our company was able to further expand its lead over the competition as a pioneer of innovation.

Together with our strategic partner Roth & Rau, Manz Automation presented its products at one of the trade show's largest stands. At this exhibition, both companies presented themselves for the first time as a joint supplier of turnkey equipment for the manufacture of crystalline solar cells.

Our focus at the trade show was on new developments, which both increase the efficiency of solar cells and reduce solar cell manufacturers' operating costs. Using our state-of-the-art PSG etching [oxide etching] equipment for crystalline solar cells [cSi], whose process technology was developed in conjunction with the Fraunhofer Institute for Solar Energy Systems ISE, wafer breakage rates in the system are significantly reduced. In addition, the system was designed to use considerably less equipment than competitors' models. As result, the ongoing costs of operating the equipment are reduced. Using this technology, the layer that forms on the surface of the wafer during phosphorus diffusion, and which acts as an isolator, can be removed. The new machine now enables throughput rates of over 3,000 wafers per hour. At the same time, Manz presented the corresponding automation system at the exhibition, which is one of our company's long-term core competencies.

One particular highlight presented by Manz Automation at the exhibition was the Laser Multi Tool [cSi], which is also used with crystalline solar cells. At the moment, this tool is still a laboratory machine. It allows developers to quickly and reliably evaluate a variety of laser applications for high-efficiency cells, meaning that the development of new cell processes can be accelerated. For instance, through the process of laser diffusion, selective emitters can be created. The result is an improvement to the efficiency of solar cells by 0.5 percent. Clients have shown significant interest in this system, which can also be retroactively integrated into production lines that already exist. This means that the profitability of older lines can be increased.

Generally speaking, there is a strong demand from clients for the ability to "upgrade" existing systems, since this allows them to cut costs of existing production lines so that they can manufacture products more competitively in the current market situation. Manz has responded to this market need, and offers clients the ability to replace or upgrade individual machines within a production line. This allows clients to reduce production costs and increase the efficiency of the solar cells and modules they manufacture. These "upgrades" can cost anywhere from 1.5 to 3.0 million euros, and they give solar manufacturers additional flexibility in a transitional period.

In the thin-film technology segment [tfs], the new developments are primarily centered on our laser scribing processes. An innovative new control system allows for a significantly higher level of precision within the process, which means an increase in the efficiency of the manufactured solar modules. Manz is the leading global supplier in this field, and we are confident that we will be able to further expand our leading position with regard to laser scribing equipment in the future.

We were also able to make considerable advancements to our system solutions for laser-edge ablation of glass substrates. In addition to increased precision and process speed and reduced breakage rates, the laser-cut substrates are significantly sturdier than substrates cut using mechanical means. The reason for this improvement is the reduction of micro-cracks in the edges. This increased stability plays a significant role in reducing loss rates during manufacture and installation of the solar modules as a result of breakage.

Yet another example of our innovative prowess is our new system for TCO texturing [tfs]. In this system, glass substrates are roughened using an etching technique so that the surface area of the finished solar module is increased. The result here is an increase in the module's efficiency. While developing this system, Manz once again made use of our expertise and synergies from the LCD division. With each of these technical milestones, our company continues to underscore its position as a technological leader when it comes to equipment used to manufacture thin-film solar modules.

Using our expertise in the area of thin-film solar technology, Manz Automation is now also developing the ability to fulfill the needs of manufacturers in the niche market for building-integrated photovoltaics [BIPV].

Our activities in the field of li-ion batteries comprise another new area of research. In this field, Manz will work in an "innovation alliance" to develop machines for the industrial manufacture of batteries. The goal of this research project is to explore new manufacturing technologies and apply them to the demands of mass production. Manz Automation will contribute its expertise to a series of production stages which are to be developed and, at the same time, will also be responsible for the automation solutions used to manufacture the batteries.

During the first nine months of the year, Manz Automation AG had a ratio of research costs to sales of 15.6%. If we only consider capitalized development costs, the ratio of research costs to sales totals 8.5%.

Notes to the results and analysis of the financial situation

Revenue Structure by Division – 9 Months 2009

Revenue Structure by Regions – 9 Months 2009

>> Earnings Position

The company's profit and loss statement is organized according to the total cost method.

In the first nine months of 2009, revenues decreased significantly from 159.1 million euros in the same period last year to 46.7 million euros. After generating revenues of 57.5 million euros in the third quarter last year, our company saw a decline in the third quarter of 2009 down to 18.5 million euros. The significant decline in revenues in the current reporting period can be traced back to numerous orders having been postponed as well as the reluctance of many clients to place new orders. Indeed, solar cell and solar module manufacturers are still feeling the effects of the recession in the entire market, which continues to slow demand for their products. This also stems from banks' continued unwillingness to finance new solar projects. As a result, it became apparent over the course of the current fiscal year that manufacturers have considerable excess capacities. As a result of rapid technological advancements and the market recovery which is expected next year, however, these excess capacities will likely be reduced quite rapidly.

The systems.solar division generated the largest share of revenues, with 36.9%, which is equal to 17.2 million euros [previous year: 88.8 million euros]. The new miscellaneous division, which was created as a result of the acquisitions carried out in 2008, accounted for a significant portion of total revenues, contributing 11.5 million euros or approx. 24.6% of the total. In the same period last year, the division generated 27.2 million euros. Products from Intech Machines Co. Ltd. in Taiwan were responsible for the lion's share of revenues in this division – among them, wet chemical processing equipment for the PCB industry. The systems.lcd division posted a similar level of revenues, generating 11.2 million euros. The division posted revenues of 34.1 million euros in the same period last year. In contrast, the systems.aico division generated revenues of 6.8 million euros, which is equal to 14.6% of total revenues [previous year: 9.0 million euros]. Revenues in this division remained fairly stable as compared to the other divisions.

The global economic and financial crisis affected all regions across the board, although Germany was slightly less affected than the other areas. Thus, Germany's share of total revenues increased from 20.7% to 39.0%; revenues here totaled 18.2 million euros after totaling 33.0 million euros last year. Manz generated exactly the same level of revenues in Asia. As a result of the significant level of revenues generated in Asia last year, the region's share of total revenues declined sharply from 60.3% to 39.0%. In the USA, revenues of approximately 1.8 million euros were achieved [previous year: 8.9 million euros]. Manz did not generate any revenues in the first nine months of 2009 in any other region [previous year: 1.5 million euros].

Together with the changes to our inventory of finished goods as well as the internally produced and capitalized assets within the scope of increased R&D investments, Manz Automation AG generated total operating revenues of 59.14 million euros. This is equal to a decline of 63.5% compared to the same period last year [162.1 million euros].

As a result of our decline in revenues, material expenditures decreased to 35.2 million euros after totaling 97.8 million euros in the same period last year. For this reason, our cost of materials ratio decreased slightly to 59.5% [previous year: 60.3%]. Consequently, our gross profit decreased in the reporting period from 68.2 million euros to 32.2 million euros. This also includes other operating income totaling 8.2 million euros [previous year: 3.8 million euros], 5.5 million euros of which resulted from realizing capital gains.

At the end of the reporting period [September 30, 2009], Manz had a total of 1,343 employees. In the course of reducing costs, we have already adjusted the capacities at our international locations [December 31, 2008: 1,513 employees]. This allowed us to reduce personnel costs from 29.5 million euros in the same period last year to 27.8 million euros. The cost savings we achieved particularly stand out when examining the period between July and September of this year: we reduced personnel costs from 11.3 million euros in the third quarter last year to 8.4 million euros in the third quarter of 2009. The effects of the shorttime work schedule which we instituted at our German locations in May of 2009 also contributed to this reduction. However, our company plans on retaining the current level of personnel in order to fully satisfy the increase in demand which we expect once the current crisis ends. In conjunction with our decline in revenues, the ratio of personnel costs to revenues increased from 18.2% in the same period last year to 47.0%.

In the first nine months of the year, write-downs totaled 5.2 million euros [previous year: 2.9 million euros]. This figure primarily contains write-downs on fixed assets as well as internally produced and capitalized assets [development costs]. The effects of our costcutting measures are beginning to be reflected in the other operating expenses. These costs consist of marketing and sales costs, logistics costs, administrative costs, as well as consulting costs, among other things. As a result, other operating expenses decreased from 16.9 million euros in the same period last year to 15.3 million euros.

As a result of existing cost structures and current excess capacities, earnings before interest and taxes [EBIT] were negative in the first nine months of 2009, totaling –16.1 million euros [previous year: 18.8 million euros]. EBIT totaled – 3.5 million euros in the third quarter of 2009, after totaling 6.7 million euros in the same period last year. These figures show that Manz Automation was able to achieve significant savings in the previous quarter as a result of our cost-cutting measures.

Upon examining the individual divisions, the EBIT of the systems.solar division declined from 14.8 million euros to –11.5 million euros. The systems.lcd division recorded an EBIT of –2.2 million euros after 3.1 million euros in the same period last year. Earnings before interest and taxes in the systems.aico division totaled –1.4 million euros after 0.7 million euros last year. The new miscellaneous division posted an EBIT of –1.1 million euros [previous year: 114,000 euros].

Interest-bearing financial liabilities, some of which are non-current, are held by our subsidiaries. However, these interest expenditures are offset by interest earnings and current investments. In the first nine months of the year, our company generated a financial profit of 1.7 million euros. This positive result can be traced back to gains achieved from the sale of marketable securities. Earnings before taxes [EBT] decreased as a result of our operating loss from 18.5 million euros in the same period last year to –14.4 million euros. Earnings before taxes [EBT] in the third quarter decreased from 7.2 million euros in the same quarter last year to –2.3 million euros this year.

After taxes and minority shares, the Group posted a loss of –11.5 million euros for the period [previous year: 14.1 million euros]. Based on an average of 4,480,054 shares outstanding, this corresponds to earnings per share of –2.45 euros [previous year: 3.52 euros per share].

>> Asset Position

The balance sheet total saw a decline on the reporting date September 30, 2009. Total assets had a value of 226.9 million euros, down from 266.5 million euros on December 31, 2008. At the same time, shareholders' equity on the balance sheet decreased as a result of the loss in the period from 191.2 million euros to 182.0 million euros. As a result, the equity ratio equaled 80.2%, up from 71.8% on December 31, 2008.

Long-term liabilities totaled 12.2 million euros at the end of the reporting period, after totaling 18.3 million euros at the end of 2008. In addition to a reduction in deferred taxes, a reduction in long-term financial liabilities of the subsidiaries Manz Automation Slovakia s.r.o and Intech Machines also played a significant role in this decrease. These liabilities were down to 2.2 million euros from 4.8 million euros on December 31, 2008. In addition, pension reserves from Manz Automation Tübingen GmbH also decreased slightly, as scheduled.

On the reporting date September 30, 2009, current liabilities totaled 32.7 million euros, significantly lower than their total of 57.0 million euros on December 31, 2008. This can primarily be attributed to a decrease in accounts payable from 24.0 million euros to 11.0 million euros. In addition, other liabilities decreased to 2.0 million euros [previous year: 6.5 million euros], particularly due to the payment of value-added tax liabilities in the reporting period. Current financial liabilities were reduced from 13.0 million euros to 10.3 million euros, primarily as a result of a reduction in overdraft credit for Manz Intech Machines Co. Ltd. On the other hand, advance payments received increased slightly from 3.3 million euros to 4.0 million euros.

On the asset side, the value of non-current fixed assets increased from 60.6 million euros to 62.6 million euros. At the same time, deferred taxes on the asset side increased from 1.1 million euros to 1.5 million euros, caused in particular by the loss in the period.

Current assets decreased from 205.9 million euros at the end of the 2008 fiscal year to 164.3 million euros. At the same time, due to the assembly of semi-finished goods and standard components, inventories increased from 33.0 million euros in the previous year to 47.6 million euros. This increase should enable Manz to deliver goods quickly once the economic environment improves. Because of the slump in operations in the first half of 2009, accounts receivable also decreased from 101.4 million euros to 60.3 million euros. Liquid assets decreased from 33.9 million euros to 25.1 million euros due to Manz repaying a loan as well as increasing inventory on hand. Under consideration of the high number of marketable securities held, the Group's net debt at the end of the quarter totaled approx – 41.4 million euros. Thus, Manz Automation effectively has no debt and also has a sufficient amount of capital to make the investments planned for the reporting period and, at the same time, to absorb the operating losses.

>> Liquidity Position

Our company generated cash flow in a narrower sense [annual net income plus write-downs on fixed assets as well as an increase/decrease in long-term pension provisions] in the first nine months of – 6.5 million euros [previous year: 18.2 million euros], primarily caused by the losses in the period. At the same time, operating cash flow decreased slightly from –4.6 million euros in the same period last year to –4.4 million euros, primarily as a result of fluctuations in working capital.

In the reporting period, cash flow from investment activities increased from –72.2 million euros last year to 1.1 million euros. This considerable change resulted from a payment of 34.5 million euros for the purchase of a 70 % majority interest in Intech Machines Co. Ltd. in Taiwan, which was made in the previous reporting period. The increase in research and development activities during the first nine months of the 2009 fiscal year is reflected in the payments made for investments in intangible fixed assets: this figure rose from 4.8 million euros last year to 6.1 million euros this year.

Cash flow from financing activities decreased at the end of the reporting period to –5.4 million euros from 104.9 million euros in the same period last year. As a result, cash and cash equivalents decreased to 25.1 million euros [previous year: 47.0 million euros].

EVENTS AFTER THE BALANCE SHEET DATE

Further events which would have had a significant impact on our financial situation have not occurred after the reporting date.

Risk analysis and forecast

GROUP Interim REPORT | Risk analysis and forecast | 39

Manz Automation's opportunities and risks

There have been no significant changes to the opportunities and risks presented in the 2008 Annual Report and the 2009 Semi-Annual Report.

Outlook

Outlook The current market environment remains difficult to describe. There have been some positive indications of a slight recovery in the past few months, yet these will not have a short-term impact on our revenues and profits. However, the important aspects are that the number of enquiries from potential clients increased, and we were given the green light to begin working on many projects which had previously been postponed by clients. The industry will benefit over the medium term from the significant decline in the market prices of solar modules that took place during the first half of the year, as investing in the industry has become considerably more attractive.

At the same time, manufacturers' need for making new and replacement investments is increasing as a result of the aforementioned decline in the price of solar products. The EU PVSEC demonstrated the efficiency of new systems which will once again allow manufacturers to achieve acceptable margins. In addition, the first areas of the world with many hours

of sunlight are anticipating grid parity being reached, which would mean a sustained rebound for the solar industry as a whole. Furthermore, the positive political environment – which sets subsidy programs for solar power in the USA, China, India, and Europe – is having a positive impact on the market's development. As one of the leading global equipment suppliers in this industry, Manz Automation will benefit from all of these developments.

However, experts do not foresee any significant improvements until the second half of next year. Until now, we have felt the reluctance of clients to issue new orders and also had a number of orders postponed. As a result, we anticipate total revenues in the 2009 fiscal year of between 80 and 85 million euros. In addition, the Managing Board expects to post a positive EBIT for the fourth quarter, without being able to compensate for the losses accrued during the rest of the year, however.

The measures we have taken to cut costs, the shorttime work schedule, the reduction of overtime hours, as well as the adjustments made to our capacities have all been crucial in keeping the recession from having an even greater impact on Manz Automation's earnings situation. We want to be well prepared for the coming recovery, however, which is why we are currently investing massively in research and development, and are adhering to the course previously embarked on. In addition, we will initially maintain our current manufacturing and personnel capacities. We are doing so because our expertise lies in the hands of our employees, and we will need this expertise once the economy recovers. Furthermore, having our production facilities in Eastern Europe and Asia means that Manz Automation AG has extremely economical manufacturing facilities at its disposal, which will continue to give us a competitive advantage with regard to costs, even after the crisis has ended. With an equity ratio of 80 % and liquid assets totaling approximately 54.0 million euros, our company is well equipped to continue pursuing our long-term strategy – even in the current state of the market.

In addition to seeing the first positive effects in Asia, where we are experiencing a booming LCD market, and our manufacturing facilities in Asia working at full capacity, the developments in China, India, and the United States seem quite promising. The programs and subsidies for the solar industry, which have been initiated there, will begin to take effect over the medium term, and we will also benefit as a supplier of machines in this segment.

With our dedication to the industrial manufacture of li-ion batteries, Manz Automation will take part in the growth opportunities of an additional emerging market. Our goal here is to establish Manz Automation as a long-term leading system supplier. As a result of the considerable size of the market for this technology, with a volume of many hundreds of million euros in the next five years alone simply for machines, we are confident that we will already be able to expand our operations in this sector into its own division of the company by next year. Doing so will diversify our business model more widely, making us less susceptible to the effects of individual sectors.

To summarize, Manz Automation will continue to systematically pursue its long-term strategy. The Managing Board looks toward the coming fiscal years with confidence, and believes our company is in a position to come out of the current crisis even stronger. Powered by an outstanding level of expertise, technological market leadership in many fields, and a solid capital structure, Manz Automation has an excellent foundation for a successful future.

Consolidated interim financial statements & notes

CONSOLIDATED Interim FINANCIAL STATEMENTs & NOTES | 47

Consolidated interim financial statements

Consolidated Statement of Income in EUR tsd

	Jan. 01 - Sept. 30, 2009	Jan. 01 - Sept. 30, 2008	3rd Quarter 2009	3rd Quarter 2008

Revenues	46,732	159,096	18,456	57,496
Changes in inventory	8,422	–395	586	142
Internally produced and capitalized assets	3,988	3,406	1,989	2,028
Total operating revenues	59,142	162,107	21,031	59,666
Other operating income	8,244	3,824	4,100	1,784
Material expenditures	–35,210	–97,757	–13,653	–36,656
Gross profit/loss	32,176	68,174	11,478	24,794
Personnel expenses	–27,819	–29,535	–8,378	–11,269
Amortization and depreciation	–5,154	–2,946	–1,607	–1,175
Other operating expenses	–15,294	–16,924	–5,026	–5,604
Earnings before interest and taxes [ EBIT ]	–16,091	18,769	–3,533	6,746
Result from equity-accounted financial investments	17	8	16	3
Financial income	2,256	240	1,481	403
Financial expenses	–576	–489	–244	0
Earnings before taxes [ EBT ]	–14,394	18,528	–2,280	7,152
Taxes on income	2,866	–4,434	570	–1,874
Consolidated operating profit	–11,528	14,094	–1,710	5,278
Portion of earnings from minority interests	–575	376	–92	233
Portion of earnings from shareholders
Manz Automation AG	–10,953	13,718	–1,618	5,045
Earnings per share
E arnings per share [undiluted ] in EUR per share	–2,45	3,52	–0,36	1,13
E arnings per share [diluted ] in EUR per share	–2,44	3,52	–0,36	1,13

Statement of comprehensive income in EUR tsd

	Jan. 01 - Sept. 30, 2009	Jan. 01 - Sept. 30, 2008	3rd Quarter 2009	3rd Quarter 2008
Consolidated comprehensive income after taxes	–11,528	14,094	–1,710	5,278
Other comprehensive income
D ifference as a result of currency conversion	148	2,572	–382	2,105
Changes to the fair value of securities	3,778	100	396	67
Changes to the fair value of cash flow hedges	–2,286	–2,570	–776	–2,391
D eferred financing costs	0	–4,020	0	–157
Changes to the valuation of share-based compensation	89	0	29	0
T ax effects from other comprehensive income	375	1,822	115	696
Other comprehensive income	2,104	–2,096	–618	320

Comprehensive income after taxes	–9,424	11,998	–2,328	5,598

Attributed to minority interests	–421	376	–149	233
Attributed to Manz Automation shareholders	–9,003	11,622	–2,179	5,365

Consolidated balance sheet [ IFRS] in EUR tsd

	Sept. 30, 2009	Dec. 31, 2008

Ass ets
Non-current assets	62,577	60,562
I ntangible assets	44,305	42,858
T angible assets	16,205	16,147
E quity-accounted financial investments	330	313
D eferred taxes	1,459	1,055
O ther non-current assets	278	189

Current assets	164,338	205,941
I nventories	47,582	33,034
A ccounts receivable	60,323	101,352
I ncome tax receivables	505	53
D erivative financial instruments	219	2,685
O ther current receivables	1,856	2,934
S ecurities	28,744	31,945
L iquid assets	25,109	33,938
Total assets	226,915	266,503
Equity and Liabilities
Equity	182,007	191,228

S hare capital	4,480	4,480
Capital reserves	144,211	144,122
T reasury shares	0	–203
Revenue reserves	23,548	32,634
Currency conversion	608	614
Manz Automation AG shareholders	172,847	181,647
Minority interests	9,160	9,581
Non-current liabilities	12,186	18,261
N on-current financial liabilities	2,172	4,820
N on-current deferred investment subsidies	281	68
F inancial liabilities from leases	28	29
P rovisions for pensions	3,680	3,720
O ther non-current provisions	1,903	2,105
D eferred taxes	4,122	7,519

Current liabilities	32,722	57,014
Current financial liabilities	10,266	13,002
A ccounts payable	10,983	24,038
A dvance payments received	3,996	3,320
I ncome tax liabilities	1,095	3,529
O ther current provisions	4,347	6,379
D erivative financial instruments	0	188
O ther liabilities	2,011	6,512
F inancial liabilities from leases	24	46
Total liabilities	226,915	266,503

consolidated cash flow statement in EUR tsd

	Jan. 01 - Sept. 30, 2009	Jan. 01 - Sept. 30, 2008
Cash flow from operations
Annual profit or loss	–11,528	14,095
Amortization / depreciation of non-current assets	5,154	2,946
Loss [+] / Profit [−] from at equity-accounted investments	–17	–8
Increase [+] / Decrease [−] in provisions for pensions and other non-current provisions	–242	1,208
Other non-cash income [−] and expenses [+]	89	0
Cash flow	–6,544	18,241
Profit [−] / Loss[+] from disposal of assets	–13	–53
Increase [−] / Decrease [+] in inventories, accounts receivable, and other assets	26,175	–35,116
Increase [+] / Decrease [−] in accounts payable and other liabilities	–24,024	12,331
Cash flow from operations	–4,406	–4,597

Cash flow from investments
Incoming payments from the sale of non-current assets	16	53
Payments for investments in intangible assets and property, plant, and equipment	–6,072	–4,807
Payments for the acquisition of consolidated companies, minus liquid assets received	0	–44,690
Incoming payments from the sale of securities	23,668	37,576
Payments for the purchase of securities	–16,477	–60,297
Cash flow from investments	1,135	–72,165

Cash flow from financing activities
Proceeds from additions to epuity	0	112,322
Capital procurement costs [ pre-tax ]	0	–4,020
Payments toward the repayment of finance lease agreements	–22	–19
Payments toward the repayment of non-current loans	–5,003	–1,594
Change in overdraft loans	–382	–1,811
Cash flow from financing activities	–5,407	104,878
Cash and cash equivalents at the end of the period
Change in cash and cash equivalents affecting cash flow [ Subtotal 1 –3 ]	–8,678	28,116
Change in cash and cash equivalents as a result of currency conversions	–151	40
Cash and cash equivalents held on Jan. 1	33,938	18,888
Cash and cash equivalents held on Sep. 30	25,109	47,044
Composition of cash and cash equivalents
Liquid assets	25,109	47,044
Cash and cash equivalents held on Sep. 30	25,109	47,044

Statement of changes in consolidated equity for the interim financial statements as of September 30, 2009 in EUR tsd

	Share capital	reserves Capital	Treasury shares		Revenue reserves		conversion Currency	Automa shareholders AG Manz tion	Minority interests	equity Total
				Aggregate earnings	Market valuation Securities	Cash flow hedges

As of Jan. 1, 2009	4,480	144,122	– 203	33,483	– 2,650	1,801	614	181,647	9,581	191,228
Total comprehensive income for the period		89		–10,953	3,511	–1,644	–6	–9,003	–421	–9,424
Sale of treasury shares			203					203		203
As of Sep. 30, 2009	4,480	144,211	0	22,530	861	157	608	172,847	9,160	182,007
As of Jan. 1, 2008	3,583	35,555	0	13,103	70	323	13	52,647	0	52,647
Total comprehensive income for the period		–2,892		13,718	72	–1,848	2,572	11,622	376	11,998
Issue of subscribed capital	897	111,425						112,322		112,322
Minority interests from business combinations								0	8,000	8,000
As of Sep. 30, 2008	4,480	144,088	0	26,821	142	–1,525	2,585	176,591	8,376	184,967

Segment reporting for divisions as of September 30, 2009, in EUR tsd

		systems.solar		systems.Icd		systems.aico		Other		Administration / Other		Consolidation		Group
	Jan. 01 –Sept. 30 2009	Jan. 01 –Sept. 30 2008	Jan. 01 –Sept. 30 2009	Jan. 01 –Sept. 30 2008	Jan. 01 –Sept. 30 2009	Jan. 01 –Sept. 30 2008	Jan. 01 –Sept. 30 2009	Jan. 01 –Sept. 30 2008	Jan. 01 –Sept. 30 2009	Jan. 01 –Sept. 30 2008	Jan. 01 –Sept. 30 2009	Jan. 01 –Sept. 30 2008	Jan. 01 –Sept. 30 2009	Jan. 01 –Sept. 30 2008
Revenues from third parties	17,240	88,807	11,189	34,139	6,819	8,956	11,484	27,194	0	0			46,732	159,096
Revenues with other segments							8,574	9,973			–8,574	–9,973
EBIT [ before allocat ing costs to adminis trative duties ]	3,692	38,169	–1,340	10,364	–360	1,290	87	2,531	–18,170	–33,585			–16,091	18,769
EBIT [after allocating costs to administrative duties]	–11,514	14,836	–2,161	3,102	–1,355	717	–1,061	114					–16,091	18,769
Segment assets	99,394	97,608	40,332	48,065	9,289	9,017	14,345	25,553	63,555	97,731				226,915 277,974
Segment liabilities	3,789	29,265	8,056	9,328	755	2,031	2,507	5,889	29,801	46,494			44,908	93,007
Net assets	95,605	68,343	32,276	38,737	8,534	6,986	11,838	19,664	33,754	51,237				182,007 184,967
Capital additions	4,641	16,296	230	12,091	266	3,594	84	4,013	851	424			6,072	36,418
Write-downs	2,681	1,127	745	613	574	502	514	390	640	314			5,154	2,946
Employees [ annual average ]	265	197	277	322	103	76	424	468	288	262			1,357	1,325

Segment reporting for revenues by regions as of September 30, 2009, in EUR tsd

	Germany		Rest of Europe		Asia		America		regions Other			Total
	Jan. 01	Jan. 01	Jan. 01	Jan. 01	Jan. 01	Jan. 01	Jan. 01	Jan. 01	Jan. 01	Jan. 01	Jan. 01	Jan. 01
	–Sept. 30	–Sept. 30	–Sept. 30	–Sept. 30	–Sept. 30	–Sept. 30	–Sept. 30	–Sept. 30	–Sept. 30	–Sept. 30	–Sept. 30	–Sept. 30
	2009	2008	2009	2008	2009	2008	2009	2008	2009	2008	2009	2008

Revenues by regions	18,228	32,999	8,486	19,741	18,240	95,965	1,778	8,868	0	1,523		46,732 159,096

notes to the consolidated interim financial statements

I. BASIC PRINCIPLES >>

The Manz Automation AG ["Manz AG"] headquarters are located in Steigaeckerstrasse 5 in 72768 Reutlingen, Germany. The business operations of Manz Automation AG and its subsidiary companies ["Manz Group" or "Manz"] consist of developing and manufacturing systems and components for automation and quality control. The systems are primarily used for the manufacture of solar cells and LCD flat screens. Shares in Manz Automation AG are traded in the Prime Standard segment of the Frankfurt Stock Exchange.

These consolidated interim financial statements dated Sept. 30, 2009, were prepared according to the International Financial Reporting Standards [IFRS] established by the International Accounting Board [IASB] as approved for use in Europe by the EU. It has been neither officially audited nor subjected to an auditor's review.

There were no changes to the accounting and valuation methods as compared to the annual financial statements dated December 31, 2008. A detailed description of these methods was published in the Notes to the 2008 Consolidated Financial Statements.

The following standards were first applied in fiscal year 2009:

IAS 1 "Presentation of Financial Statements" requires a statement of comprehensive income which includes the income and expenses previously recorded directly to equity and not affecting net income [other comprehensive income]. In the course of exercising our option in accordance with IAS 1.81, Manz AG has chosen to present all income and expense items in a period in two statements: a separate income statement and a transition from consolidated earnings to a comprehensive result which includes those parts of the result for the period which do not affect income [statement of comprehensive income]. In this context, we adjusted our presentation of the statement of changes in equity and the respective comparison periods.

IFRS 8 "Operating Segments" requires that the disclosure of information regarding the Group's operating segments be carried out in accordance with the "management approach", and replaces the requirement to use primary [operating segments] and secondary [geographic segments] segment reporting formats for the group. The evaluation of the requirements set forth in IFRS 8 resulted in no changes to the identified operating segments compared to fiscal year 2008.

The consolidated interim financial statements were prepared in euros. If not otherwise noted, all amounts are shown in thousands of euros.

56 |CONSOLIDATED Interim FINANCIAL STATEMENTs & NOTES | Notes to the consolidated interim financial statements | II. BASIS OF CONSOLIDATION | III. KEY EVENTS IN THE PERIOD UNDER REVIEW

II. BASIS OF CONSOLIDATION >>

Manz Automation AG's consolidated financial statements include all of the companies for which Manz AG can either directly or indirectly determine the financial and operational policy ["controlling" relationship]. In addition to Manz Automation AG, the group of consolidated companies includes the following subsidiaries:

Fully consolidated companies

Manz Automation Tübingen GmbH	Tuebingen/Germany	100.0
Helmut Majer Verwaltungsgesellschaft mbH	Tuebingen/Germany	100.0
Manz Automation Inc.	North Kingstown/USA	100.0
Manz Automation Hungary Kft.	Debrecen/Hungary	100.0
MVG Hungary Kft.	Debrecen/Hungary	100.0
Manz Immo Hungary Kft. 1]	Debrecen/Hungary	100.0
Manz Automation Slovakia s.r.o.	Nove Mesto nad Vahom/Slovakia	90.0
Manz Automation Spain S.L.	Madrid/Spain	100.0
Manz Automation Asia Ltd.	Hong Kong	100.0
Manz Automation Taiwan Ltd. 2]	Hsinchu/Taiwan	100.0
Manz Automation [Shanghai] Co. Ltd. 2]	Shanghai/China	100.0
Manz Automation India Private Limited 2]	New Delhi/India	75.0
Manz Intech Machines Co. Ltd. 2]	Chungli/Taiwan	75.6
ntech Enterprises [B.V.I.] Co. Ltd. 3] I	Road Town/British Virgin Islands	75.6
ntech Machines [B.V.I.] Co. Ltd. 3] I	Road Town/British Virgin Islands	75.6
ntech Machines [Suzhou] Co. Ltd. 4] I	Suzhou/China	75.6
Qinhuangdao Intech Machines Ltd. 4]	Qinhuangdao/China	75.6
ntech Technical [Shenzhen] Co. Ltd. 4] I	Shenzhen/China	75.6
Consolidation at Equity
Axystems Ltd.	Petach-Tikva/Israel	24.0

1] via MVG Hungary Kft. [as of December 31, 2008: via Manz Automation Hungary Kft.] 2] via Manz Automation Asia Ltd. 3] via Manz Intech Machines Co. Ltd. 4] via Intech Machines (B.V.I.) Co. Ltd.

III. KEY EVENTS IN THE PERIOD UNDER REVIEW >>

In the first nine months of fiscal year 2009, the Manz Group's revenues decreased by 71% from 159.1 million euros in the same period last year to 46.7 million euros. Total operating revenues declined by 64 % to 59.1 million euros.

Earnings before interest and taxes [EBIT] declined from 18.8 million euros in the same period last year to –16.1 million euros.

IV. NOTES TO THE INDIVIDUAL ITEMS IN THE INCOME STATEMENT >>

Other operating income

	Sept. 30, 2009 EUR tsd	Sept. 30, 2008 EUR tsd

Capital gains	5,502	2,938
Income from the liquidation of reserves	220	105
Income from the reduction/consumption of provisions	718	0
Income from the sale of investments	13	61
Subsidies	247	106
Changes to the revaluation of accounts receivable	1,040	12
Other	504	602
	8,244	3,824

Material expenditures

	Sept. 30, 2009 EUR tsd	Sept. 30, 2008 EUR tsd

Cost of raw materials and supplies and purchased goods	31,663	70,226
Expenditures for third-party services	3,547	27,531
	35,210	97,757

Other operating expenses

	Sept. 30, 2009 EUR tsd	Sept. 30, 2008 EUR tsd

Advertising and travel expenses	2,178	3,035
Outgoing freight, packaging	1,031	3,190
Rent and leasing	3,187	2,450
Commissions	258	1,109
Legal and consulting costs	613	1,040
Insurance	407	393
Capital losses	1,087	766
Changes to the revaluation of accounts receivable	526	316
Other	6,007	4,625
	15,294	16,924

Taxes on income

Income taxes include both actual and deferred income taxes from temporary differences and existing tax loss carryforwards.

Income taxes are composed of the following items:

	Sept. 30, 2009 EUR tsd	Sept. 30, 2008 EUR tsd

Deferred tax liabilities/income [−]	–193	722
Deferred tax liabilities/income [−]	–2,673	3,712
	–2,866	4,434

58 | CONSOLIDATED Interim FINANCIAL STATEMENTs & NOTES | Notes to the consolidated interim financial statements | V. NOTES TO THE INDIVIDUAL ITEMS IN THE INCOME STATEMENT

V. NOTES TO THE INDIVIDUAL ITEMS IN THE INCOME STATEMENT >>

Intangible assets

	Sept. 30, 2009 EUR tsd	Dec. 31, 2008 EUR tsd

Licenses, software and similar rights, and assets	13,969	11,531
Capitalized development costs	8,754	6,573
Goodwill	21,582	21,913
Advance payments made	0	2,841
	44,305	42,858

Tangible assets

	Sept. 30, 2009 EUR tsd	Dec. 31, 2008 EUR tsd

Properties and buildings including buildings on third-party properties	8,024	7,785
Technical equipment and machinery	3,419	4,499
Other equipment, furniture, and office equipment	4,631	3,620
Advance payments made	131	243
	16,205	16,147

Inventories

	Sept. 30, 2009 EUR tsd	Dec. 31, 2008 EUR tsd

Raw materials and supplies	15,338	13,602
Goods in process, work in progress	22,989	12,165
Finished goods, products	2,951	4,518
Advance payments made	6,304	2,749
	47,582	33,034

Accounts receivable

	Sept. 30, 2009 EUR tsd	Dec. 31, 2008 EUR tsd

Future receivables from non-current construction contracts	24,411	29,658
Accounts receivable	35,912	71,694
	60,323	101,352

Future receivables from non-current construction orders, accounted for according to their percentage of completion, are determined as follows:

Manufacturing costs including outcome of the contract for non-current construction contracts	41,059	50,462
minus advance payments received	–16,648	–20,804
	24,411	29,658

Other current receivables

	Sept. 30, 2009	Dec. 31, 2008 EUR tsd
	EUR tsd

Tax receivables [not income taxes]	269	854
Receivables – personnel	75	119
Accrued interest	192	483
Other accruals and deferrals [primarily from insurance]	519	458
Other	801	1,020
	1,856	2,934

Equity

Changes to the Group's individual equity items are detailed separately in the "Consolidated Statement of Changes to Equity".

Share capital

Share capital totals 4,480,054 euros [December 31, 2008: 4,480,054 euros] and is divided into 4,480,054 registered, common, no-par shares. The face value of a no-par share equals 1.00 euro.

There were no changes in share capital in the first nine month of 2009.

Capital reserves

The capital reserves primarily contain payments from shareholders pursuant to Article 272, Paragraph 2, No. 1 of the German Commercial Code, minus financing costs after taxes.

The increase in the year 2009 totaling 89,000 euros pertains to the allocation of funds from share-based compensation [Manz-Performance-Plan 2008].

Treasury shares

All treasury shares were distributed in the reporting period within the scope of the employee profit sharing plan 2008.

60 | CONSOLIDATED Interim FINANCIAL STATEMENTs & NOTES | Notes to the consolidated interim financial statements | VI. KEY EVENTS OF PARTICULAR IMPORTANCE OCCURRING AFTER THE END OF THE REPORTING PERIOD | VII. Further Information

VI. KEY EVENTS OF PARTICULAR IMPORTANCE OCCURRING AFTER THE END OF THE REPORTING PERIOD >>

No further events occurred after the reporting date which could have an impact on our company's financial position and results of operations.

VII. Further Information >>

Employees

In the first nine months of 2009, the Manz Group had an average of 1,357 employees [September 30, 2008: 1,325 employees].

Managing Board

Dieter Manz, Dipl.-Ing. [FH], CEO Martin Hipp, Dipl.-Kaufmann, CFO Volker Renz, Dipl.-Ing. [FH], COO Otto Angerhofer, Dipl.-Ing. [FH] – until July 31, 2009 –

Supervisory Board

Dr. Jan Wittig [Chairman], Attorney-at-law Partner at Dr. Schaudt und Kollegen, Stuttgart, Germany

Prof. Dr. Heiko Aurenz, Dipl. oec. [Deputy Chairman], Managing Partner of Ebner Stolz Mönning Bachem Unternehmensberatung GmbH, Stuttgart, Germany

Prof. Dr.-Ing. Dr. h.c. mult. Rolf D. Schraft

Manz Automation AG

Steigaeckerstrasse 5 D-72768 Reutlingen Fon +49 [0] 7121 9000-0 Fax +49 [0] 7121 9000-99 [email protected]