MBB SE — Interim / Quarterly Report 2015

May 29, 2015

QUARTERLY FINANCIAL REPORT MARCH 31, 2015

MBB SE, Berlin

MBB in figures

Three months	2015	2014	Δ 2015 /
(unaudited)			2014
	IFRS	IFRS
Earnings figures	€ thou	€ thou	%
Revenue	60,241	55,618	8.3
Operating performance	59,579	55,883	6.6
Total performance	61,333	56,249	9.0
Cost of materials	-37,248	-33,759	10.3
Staff costs	-13,873	-13,123	5.7
EBITDA	6,449	5,532	16.6
EBITDA margin	10.8%	9.9%
EBIT	4,622	4,015	15.1
EBIT margin	7.8%	7.2%
EBT	4,363	3,820	14.2
EBT margin	7.3%	6.8%
Consolidated net profit after
non-controlling interests	3,102	3,211	-3.4
Number of shares	6,600,000	6,600,000
eps in €*	0.47	0.50	-6.0
Figures from the statement	31 Mar	31 Dec
of financial position	€ thou	€ thou	%
Non-current assets	75,602	75,593	0.0
Current assets	129,683	121,098	7.1
there of cash and equivalents**	52,774	58,672	-10.1
Issued capital (share capital)	6,595	6,600	-0.1
Other equity	75,923	71,953	5.5
Total equity	82,518	78,553	5.0
Equity ratio	40.2%	39.9%
Non-current liabilities	55,137	53,459	3.1
Current liabilities	67,630	64,679	4.6
Total assets	205,285	196,691	4.4
Net debt (-) or
net cash (+)**	15,696	24,345	-35.5
Employees	1,161	1,152	0.8

* Based on the average number of shares outstanding as at 31 March.

** This figure includes physical gold stocks and securities.

Contents

MBB in figures	1
Contents	2
Interim Group Management Report	3
Business and economic conditions	3
Results of operations, financial position and net assets	3
Segment performance	3
Employees	4
Report on risks and opportunities	4
Changes under company law	4
Executive Management	4
Share buy-back programme	4
Report on expected developments	4
IFRS interim consolidated financial statements for Q1 2015	5
Notes to the interim consolidated financial statements	11
Accounting	11
Accounting policies	11
Segment reporting	11
Dividend	11
Changes in contingent liabilities	12
Related party transactions	12
Events after the end of the reporting period	12
Review	12
Responsibility statement	12
Financial Calendar	13
Contact	13
Legal notice	13

Interim Group Management Report

MBB SE is a family-owned, medium-sized corporation that forms the MBB Group together with its subsidiaries.

Business and economic conditions

In Germany the current low price of oil and the strong depreciation of the euro are enabling an upswing. The IMF is forecasting growth in 2015 of 1.6% for Germany and 1.5% for the euro area. However, the lingering geopolitical risks in Ukraine and the Middle East should also not be forgotten for the western economies heavily dependent on the global economy.

The trend on the sub-markets relevant to MBB is generally positive and stable. In particular, according to figures by the German Association of the Automotive Industry (VDA), all three major car markets – the US, China and Europe – posted growth. Western Europe saw the strongest demand for cars in five years. The biggest rise in growth again happened in China, where 11% more new cars were sold in the first three months than in the previous year.

Overall, our subsidiaries have sufficient order backlogs and constant incoming orders, though at MBB Fertigungstechnik in particular this was slightly more moderate than in previous years.

Results of operations, financial position and net assets

The Group's results of operations, net assets and financial position are positive. In the first three months of the 2015 financial year, the consolidated revenue of the MBB Group was up 8.3% year-onyear at €60.2 million (previous year: €55.6 million).

Other operating income of €1.8 million (previous year: €0.6 million) includes income from sales of securities of €1.1 million, income from currency translation of €0.4 million and other income of €0.3 million.

The ratio of cost of materials to the total operating performance of €59.6 million in the first three months of 2015 (previous year: €55.8 million) climbed from 60.4% in the previous year to 62.5%.

EBITDA (earnings before interest, taxes, depreciation and amortisation) increased by 16.6% to €6.4 million (previous year: €5.5 million). After depreciation and amortisation of €1.8 million, EBIT (earnings before interest and taxes) for the MBB Group was €4.6 million (previous year: €4.0 million). Adjusted for net finance costs of €0.3 million, EBT (earnings before taxes) amounted to €4.4 million (previous year: €3.8 million). The consolidated net profit after non-controlling interests was €3.1 million (previous year: €3.2 million) or €0.47 per share (based on an average of 6,599,557 shares outstanding) in the first three months. The consolidated net profit is lower than in the previous year even though EBITDA and EBIT were up year-on-year as the first quarter of 2014 still benefited from tax concessions for investing activities in Poland.

The consolidated statement of financial position as at 31 March 2015 reported equity of €82.5 million (31 December 2014: €78.6 million). Based on total consolidated assets of €205.3 million, the equity ratio was therefore 40.2% after 39.9% as at 31 December 2014.

As at 31 March 2015, the MBB Group had financial liabilities of €37.1 million (31 December 2014: €34.3 million) and cash and cash equivalents including securities and physical gold reserves of €52.8 million (31 December 2014: €58.7 million). Accordingly, net cash from the above liabilities and cash positions of the MBB Group amounted to €15.7 million compared to €24.3 million as at 31 December 2014. The reduction in net cash reflects the increase in receivables in the statement of financial position as at 31 March 2015, and results from the repayment of liabilities in the first quarter of 2015 from the acquisition of two operating properties at the end of 2014.

Segment performance

The following segments are reported:

• Technical Applications
• Industrial Production
• Trade & Services

In the Technical Applications segment revenue and EBIT are almost at the same high level. In the first three months of 2015 the segment's external revenue amounted to €30.0 million (previous year: €30.2 million) and its EBIT to €3.5 million (previous year: €3.6 million).

In the Industrial Production segment there was significant growth in revenue as a result of investments made in the previous year. External revenue for the period from 1 January to 31 March 2015 amounted to €21.0 million after €14.6 million in the same period of 2014, while EBIT was higher than in the previous year at €1.3 million after €0.7 million.

Revenue in the Trade & Services segment decreased slightly year-on-year to €7.2 million (previous year: €8.8 million). Segment EBIT also fell to minus €297 thousand (previous year: minus €40 thousand).

Employees

The number of people employed by the MBB Group increased slightly from 1,152 as at 31 December 2014 to 1,161 as at 31 March 2015.

Report on risks and opportunities

The risks and opportunities for the business development of the MBB Group are described in the Group management report for the 2014 financial year, which is available on our website. There have been no significant changes in the risks and opportunities presented since 31 December 2014. The risk management system of MBB SE is appropriate for detecting risks at an early stage and taking immediate countermeasures.

Changes under company law

The change in legal form of MBB Industries AG to MBB SE that was resolved by the Annual General Meeting on 30 June 2014 was entered in the commercial register of the Charlottenburg District Court on 9 March 2015 under HRB 165458 and the company name "MBB SE".

Executive Management

On 24 March 2015, the Board of MBB SE appointed the long-standing members of management, Anton Breitkopf (Chief Financial Officer), Dr Gerrit Karalus (Chief Investment Officer) and Klaus Seidel (Chief Technical Officer), as additional of the Executive Management and appointed Dr Christof Nesemeier as the Chief Executive Officer. The terms of all the members of the Executive Management run until 30 June 2018.

Share buy-back programme

MBB SE implemented a share buy-back programme for the period from 18 March to 7 May 2015. 13,225 shares were bought back at an average price of €23.55. 5,412 of these shares were bought by 31 March 2015.

Report on expected developments

For 2015 the Executive Management are forecasting total revenue of between €240 and €250 million with earnings of at least €1.75 per share.

The Executive Management consider the Group's equity and liquidity situation to be important factors in enabling it to grow in the current market environment, both organically and through the acquisition of new equity investments, while ensuring that it remains in a position to act at all times and even in the event of new global crises.

Berlin, 29 May 2015

The Executive Management

(unaudited) 31 Mar 2015 31 Mar 2014 € thou € thou Revenue 60,241 55,618 Increase (+) / decrease (-) in finished goods and work in progress -662 265 Operating performance 59,579 55,883 Other operating income 1,754 366 Total performance 61,333 56,249 Cost of raw materials and supplies -28,098 -27,109 Cost of purchased services -9,150 -6,650 Cost of materials -37,248 -33,759 Wages and salaries -10,330 -9,671 Social security and pension costs -3,543 -3,452 Staff costs -13,873 -13,123 Other operating expenses -3,763 -3,835 Earnings before interest, taxes, depreciation, and amortisation (EBITDA) 6,449 5,532 Amortisation and depreciation expense -1,827 -1,517 Earnings before interest and taxes (EBIT) 4,622 4,015 Other interest and similar income 159 107 Interest and similar expenses -418 -302 Net finance costs -259 -195 Earnings before taxes (EBT) 4,363 3,820 Income tax expense -1,185 -497 Other taxes -64 -44 Profit or loss for the period 3,114 3,279 Non-controlling interests -12 -68 Consolidated net profit 3,102 3,211 Earnings per share (in €) 0.47 0.50	IFRS consolidated statement of comprehensive income	1 Jan -	1 Jan -

IFRS interim consolidated financial statements for Q1 2015

IFRS consolidated statement of comprehensive income	1 Jan -	1 Jan -
(unaudited)	31 Mar 2015	31 Mar 2014
	€ thou	€ thou
Consolidated net profit	3,102	3,211
Non-controlling interests	12	68
Profit or loss for the period	3,114	3,279
Items that may be subsequently reclassified
to profit and loss
Currency translation differences	761	-112
Available for sale financial assets	235	220
Other comprehensive income after taxes	996	108
Comprehensive income for the reporting period	4,110	3,387
there of attributable to:
- Shareholders of the parent company	4,118	3,319
- Non-controlling interests	-8	68

Statement of financial position	31 Mar 2015	31 Dec 2014
Assets (IFRS)	unaudited	audited
Non-current assets	€ thou	€ thou
Concessions, industrial property rights and similar rights	5,522	5,691
Goodwill	1,816	1,816
Advance payments	36	37
Intangible assets	7,374	7,544
Land and buildings
including buildings on third-party land	28,687	28,586
Technical equipment and machinery	18,035	18,387
Other equipment, operating and office equipment	4,089	4,092
Advance payments and assets under development	972	543
Property, plant and equipment	51,783	51,608
Investment securities	10,240	9,507
Other loans	94	101
Financial assets	10,334	9,608
Deferred tax assets	6,111	6,833
	75,602	75,593
Current assets
Raw materials and supplies	8,006	6,356
Work in progress	2,998	2,613
Finished goods	9,205	9,913
Advance payments	2,393	1,344
Inventories	22,602	20,226
Trade receivables	21,644	20,560
Receivables from construction contracts	37,608	26,561
Other current assets	5,295	4,586
Trade receivables
and other current assets	64,547	51,707
Gold and commodities	1,979	1,724
Securities	12,284	10,048
Available-for-sale financial assets	14,263	11,772
Cash in hand	16	16
Bank balances	28,255	37,377
Cash in hand, bank balances	28,271	37,393
	129,683	121,098
Total assets	205,285	196,691

Statement of financial position	31 Mar 2015	31 Dec 2014
Equity and liabilities (IFRS)	unaudited	audited
	€ thou	€ thou
Equity
Issued capital	6,595	6,600
Capital reserve	17,657	17,779
Legal reserve	61	61
Retained earnings	54,721	50,603
Non-controlling interests	3,484	3,510
	82,518	78,553
Non-current liabilities
Liabilities to banks	25,480	24,847
Trade payables	366	395
Other liabilities	1,804	1,887
Pension provisions	22,483	22,386
Other provisions	851	692
Deferred tax liabilities	4,153	3,252
	55,137	53,459
Current liabilities
Due to banks	9,628	7,449
Advance payments received	5,845	2,806
Trade payables	19,593	19,637
Other liabilities	4,421	7,137
Provisions with the nature of a liability	9,614	8,210
Tax provisions	720	2,983
Other provisions	17,809	16,457
	67,630	64,679
Total equity and liabilities	205,285	196,691

Consolidated statement of cash flows	1 Jan -	1 Jan -
(unaudited)	31 Mar 2015	31 Mar 2014
	€ thou	€ thou
1. Cash flow from operating activities
Earnings before interest and taxes (EBIT)	4,622	4,015
Adjustments for non-cash transactions
Write-downs on non-current assets	1,827	1,517
Increase (+) /decrease (-) in provisions	1,608	-4,261
Other non-cash expenses / income	-122	-107
	3,313	-2,851
Change in working capital:
Increase (-) / decrease (+) in inventories, trade receivables
and other assets	-15,216	-2,600
Decrease (-) / increase (+) in trade payables
and other liabilities	1,571	461
	-13,645	-2,139
Income taxes paid	-1,889	-351
Interest received	159	107
	-1,730	-244
Cash flow from operating activities	-7,440	-1,219
2. Cash flow from investing activities
Investments (-) / divestments (+) intangible assets	28	-28
Investments (-) / divestments (+) property, plant and equipment	-1,102	-2,452
Investments (-) / divestments (+) financial assets	7	251
Investments (-) / divestments (+) of available-for-sale financial
assets and securities Cash flow from investing activities	-2,989 -4,056	-1,090 -3,319
3. Cash flow from financing activities
Payments to Non-Controlling Interests	-18	0
Share buy back programme	-127	3,528
Proceeds from borrowing financial loans	3,133	2,701
Repayments of financial loans	-321	0
Interest payments	-373	-302
Cash flow from financing activities	2,294	5,927
Cash and cash equivalents at end of period
Change in cash and cash equivalents
(Subtotal 1-3)	-9,202	1,389
Effects of changes in foreign exchange rates (non-cash)	80	-5
Cash and cash equivalents at start of reporting period	37,393	36,703
Cash and cash equivalents at end of period	28,271	38,087
Composition of cash and cash equivalents
Cash in hand	16	20
Bank balances	28,255	38,067
Reconciliation to liquidity reserve on 31 Mar	2015	2014
Cash and cash equivalents at end of period	28,271	38,087
Gold	1,979	1,645
Securities	22,524	17,892
Liquidity reserve on 31 Mar	52,774	57,624

Statement of changes in consolidated equity (unaudited)
					Retained earnings
	Issued capital	Capital reserve	Legal reserve	Currency translation difference	Available for sale financial assets	Pension reserve	Generated consoli dated equity	Share of sharehold ers of MBB SE	Non controlling interests	Consoli dated equity
	€ thou	€ thou	€ thou	€ thou	€ thou	€ thou	€ thou	€ thou	€ thou	€ thou
1 Jan 2014	6,456	14,395	61	-218	1,179	6	43,057	64,936	2,853	67,789
Payments to shareholders	0	0	0	0	0	0	-3,630	-3,630	-93	-3,723
Subtotal	6,456	14,395	61	-218	1,179	6	39,427	61,306	2,760	64,066
Amounts recognised in other comprehensive income	0	0	0	0	266	-2,693	0	-2,427	-15	-2,442
Currency translation difference	0	0	0	-398	0	0	0	-398	31	-367
Consolidated net profit	0	0	0	0	0	0	13,199	13,199	569	13,768
Total comprehensive income	0	0	0	-398	266	-2,693	13,199	10,374	585	10,959
Non-Controlling Interests Hanle Tissue	0	0	0	0	0	0	-165	-165	165	0
Sale of treasury shares	144	3,384	0	0	0	0	0	3,528	0	3,528
31 Dec 2014	6,600	17,779	61	-616	1,445	-2,687	52,461	75,043	3,510	78,553
Payments to shareholders	0	0	0	0	0	0	0	0	-18	-18
Subtotal	6,600	17,779	61	-616	1,445	-2,687	52,461	75,043	3,492	78,535
Amounts recognised in other comprehensive income	0	0	0	0	235	0	0	235	0	235
Currency translation difference	0	0	0	781	0	0	0	781	-20	761
Consolidated net profit	0	0	0	0	0	0	3,102	3,102	12	3,114
Total comprehensive income	0	0	0	781	235	0	3,102	4,118	-8	4,110
Treasury shares	-5	-122	0	0	0	0	0	-127	0	-127
31 Mar 2015	6,595	17,657	61	165	1,680	-2,687	55,563	79,034	3,484	82,518

Notes to the interim consolidated financial statements

Accounting

The three-month financial report of the MBB Group for the period 1 January to 31 March 2015 was prepared on the basis of the International Financial Reporting Standards (IFRS) published by the Inte rnational Accounting Standards Board (IASB) as adopted in the EU. It was prepared in accordance with IAS 34.

Accounting policies

The accounting policies adopted are the same as those of the consolidated financial statements as at 31 December 2014. The preparation of the financial statements is influenced by accounting policies and assumptions and estimates affecting the amount and reporting of recognised assets, liabilities, conti ngent liabilities and income and expense items. Matters relating to revenue are deferred intra -year.

Segment reporting

The management of the MBB Group classifies the segments as reported in the interim Group management report.

1 Jan - 31 Mar 2015	Technical applications	Industrial production	Trade & services	Recon- ciliation	Group
(unaudited)	€ thou	€ thou	€ thou	€ thou	€ thou
Revenue from third parties	32,016	21,024	7,201	0	60,241
Other segments	6	2	56	-64	0
Total revenue	32,022	21,026	7,257	-64	60,241
Earnings (EBIT)	3,524	1,259	-289	128	4,622
Amortisation and depreciation	607	889	321	10	1,827
Investments	265	538	271
Segment assets	82,221	50,929	9,584
Segment liabilities	62,323	14,045	3,423

1 Jan - 31 Mar 2014	Technical applications	Industrial production	Trade & services	Recon- ciliation	Group
(unaudited)	€ thou	€ thou	€ thou	€ thou	€ thou
Revenue from third parties	32,188	14,613	8,817	0	55,618
Other segments	8	37	46	-91	0
Total revenue	32,196	14,650	8,863	-91	55,618
Earnings (EBIT)	3,557	705	-40	-207	4,015
Amortisation and depreciation	580	657	269	11	1,517
Investments	667	1,465	348
Segment assets	70,947	41,035	8,637
Segment liabilities	50,070	9,582	4,252

Segment liabilities do not include any liabilities from taxes, finance lease liabilities or liabilities to banks.

Dividend

At the Annual General Meeting to be held in Berlin on 30 June 2015 the Executive Management and the Board of MBB SE will propose a dividend of €0.57 per entitled share for the 2014 financial year.

Changes in contingent liabilities

There were no changes in contingent liabilities as against 31 December 2014.

Related party transactions

Business transactions between fully consolidated Group companies and unconsolidated Group companies are conducted at arm's-length conditions.

Events after the end of the reporting period

There have been no significant events since the end of the reporting period.

Review

The condensed interim consolidated financial statements as at 31 March 2015 and the interim Group management report were neither audited in accordance with section 317 of the German Commercial Code (HGB) nor reviewed by an auditor.

Responsibility statement

To the best of our knowledge, and in accordance with the applicable reporting principles for interim financial reporting, the consolidated interim financial statements give a true and fair view of the net assets, financial position and results of operations of the Group, and the interim management report of the Group includes a fair review of the development and performance of the business and the position of the Group, together with a description of the principal opportunities and risks associated with the expected development of the Group for the remaining months of the financial year.

Berlin, 29 May 2015

The Executive Management

Financial Calendar

Annual General Meeting 30 June 2015 at Ludwig Erhard Haus, Fasanenstrasse 85, 10623 Berlin, Germany

Half-year financial report 2015

31 August 2015

Analyst Conference German Equity Forum

Frankfurt/Main

23 - 25 November 2015

Quarterly report Q3 2015

30 November 2015

End of the financial year

31 December 2015

We would like to take this opportunity to mention our RSS feed, with which you can subscribe to and read the latest news from the company on your computer screen free of charge. This is a quick and convenient way of staying up-to-date: www.mbb.com/RSS

We would also like to draw your attention to our MBB newsletter, which you can subscribe to at www.mbb.com/newsletter. You will then always receive the latest news from MBB SE by e-mail.

Contact

MBB SE Joachimsthaler Strasse 34 10719 Berlin Tel.: +49 (0) 30 844 15 330 Fax: +49 (0) 30 844 15 333 www.mbb.com request@mbb.com

Legal notice

© MBB SE Joachimsthaler Strasse 34 10719 Berlin

MBB.COM