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Nexus AG

Quarterly Report Aug 20, 2010

305_10-q_2010-08-20_5a54a3d2-3c85-4a19-9b8a-a716cb785411.pdf

Quarterly Report

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Half Year Report August 16, 2010

Letter to Our Stockholders

Dear Stockholders,

Substantial sales growth and a greatly improved result: NEXUS completed the first half year 2010 very successfully. We are starting into the second quarter 2010 with this good news. As a result, we are continuing the positive trend of the past years and furthering our development with a great number of new customers, who decided in favor of NE-XUS in the first half year.

We are convinced that this on-going positive development is mainly due to our long-term strategy, which puts a convincing product program and healthy, profitable growth in the forefront. Our market and our customers appreciate this mixture of purposeful innovation and continuity and make it possible for us to win further market shares nationally and internationally.

For example, we acquired larger orders for introducing our Hospital Information System (NEXUS / HIS) from the Protestant Clinical Center in Stuttgart, Vinzenz von Paul Hospital in Rottweil, the psychiatry center in Rickling and five additional hospitals in the Swiss Canton of Fribourg and consequently proved how positively our new products are being accepted on the market. Our software products support numerous hospital processes in the projects and are relieving hospital staff of routine and documentation work as a result.

The same applies to our solutions specific for wards and departments (NEXUS / DIS), i.e., software support of special diagnostic process (e.g., radiology) in hospitals. We were able to win important orders in the areas of pathology and radiology in the first half year and expand our market position in these segments.

We were also able to acquire several hospital associations as new customers for NEXUS / CURATOR in the product area of quality management. This is a product that especially simplifies knowledge management in hospitals and consequently supports the trend to quality control and uniform treatment guidelines. NEXUS is market leader among software companies in this very important area for hospitals. Two basic tendencies have become clear with respect to

Highlights 1st Half Year – 2010 Development of Business

    • Strongly increase in sales; especially in the Healthcare Software segment
    • New orders of NEXUS / KIS
    • Increase of international sales

project implementation over the past months. On one hand, we are succeeding in reducing the introduction times of our systems further and providing customers with the expected advantages of the software more quickly. This has been demonstrated in the new projects in the Kiel Metropolitan Hospitals and in Mosbach as well as in the operation startup of two hospitals on the Turks & Caicos Islands, for example. We started operation of complete projects there within respectively very short times. On the other hand, we see that our regular customers are investing decisively in enhancements. The topics of medication, pharmacy, emergency care as well as management and knowledge information systems are currently being implemented as additional projects and supporting our customers in digitalizing their hospital processes more comprehensively.

Following the very successful introduction of NEXUS / HIS last year, our development is also focusing on these topics. The core process of medication is the focal point here. It is a matter of enhancing the existing solution even more and fulfilling the demands of our customers for depiction of additional medication processes and ergonomic improvements. However, we are also very active in elaborating new solutions in the topics of the emergency care department and management information systems (MIS). We especially made investments in MIS over the past weeks, which will advance our technology even more.

The development of our international patient management is certainly one of our special features. We are working on depicting the internationally very different patient management invoicing processes with an easy-to-parameterize solution.

We are already implementing customer projects in the first two countries. There is great potential for internationalization here and for differentiating us very strongly from our competitors. We are convinced that we are supporting development of our company decisively with this long-term and innovative development project. We can see in the first half-year figures that this strategy is bearing fruit.

We succeeded in continuing the unbroken positive development of the past years and in increasing both our sales and result strongly. Sales increased in the first half year by approx. 10.1% from EUR 18.8 million to EUR 20.7 million.

The operating result improved even more. The result before taxes increased by approx. 61% to EUR 1.58 million following EUR 0.98 million in the first half year of the previous year. The result was approx. EUR 1.53 million after taxes (previous year: EUR 0.85 million), and consequently we achieved an increase of 80%.

The operative cash flow is also to be emphasized here. We achieved a five percent increase from EUR 5.4 million during this period following EUR 3.6 million in the previous year.

There were considerable changes in balance sheet positions compared to 31 December 2009. We adapted risk precautions with increased reserves and reduced our accounts payable. At the same time, our liquid assets (EUR 13.9 million) increased substantially thanks to the good result. Accounts payable decreased again compared to the first quarter, but are slightly higher at 12.7 million than the value at the end of 2009 (EUR 12.5 million).

We are confirming the already good first quarter and the long-term trend of our company with this strong half-year result. We are going to have to prove in the second half year that we can also achieve these increase rates in the future too. The challenges are not minor that we are facing in current projects and in canvassing new markets. However, if we consider our good technological position and the continual increasing of our market shares and thus sales, we are confident that we can master these challenges.

It is also good news that we have been able to depict our positive development on the capital market and stimulate a lot of interest among investors, so that sales of our stocks have increased considerably on the securities market. Even though we are not yet satisfied with the price development of our stocks, we can see that the discrepancy between our company development and stock prices has become smaller. We hope that this development continues. With respect to our business, we are determined to support the positive development on the securities market with continually increasing business figures. It is also our goal to be among the top companies in our market segment with respect to sales and result.

Sincerely,

Dr. Ingo Behrendt CEO - NEXUS AG

Interim Annual Report - Sales: Increase in the First Half Year

NEXUS Group sales increased from KEUR 18,829 to KEUR 20,731 (+10.1%) in the first six months of the year 2010.

The Healthcare Software segment is responsible for the good development of sales; its sales increased by 11.1% compared to the same period of the previous year from KEUR 16,667 to KEUR 18,510. Sales in the area of Healthcare Service increased by 2.7% from KEUR 2,162 to KEUR 2,221.

In a quarterly comparison to the previous year, sales of the Group increased by 11.7% to KEUR 10,403 (Q2-2009: KEUR 9,316).

The sales growth is especially due to the greater number of sales in international business and increased demand in Germany.

Our increased sales in the product areas NEXUS / HIS, NEXUS / QM and NEXUS / PATHOLOGY are certainly to be emphasized here. We are currently experiencing a high demand in these product areas.

Highlights 1st HY - 2010
Sales and Result
Sales by
regions
01/01/ -
06/30/09
01/01/ -
06/30/10
∆ in
%
04/01/ -
06/30/09
04/01/ -
06/30/10
∆ in
%
KEUR KEUR KEUR KEUR
+ 10.1% sales increase in first HY-2010 from
EUR 18.8 million (in 2009) to EUR 20.7 million Germany 12,099 12,737 5,3 6,184 6,340 2,5
+ 60.6% increase in result before taxes from Switzerland 4,230 5,654 33,7 2,015 2,884 43,1
EUR 0.98 million to EUR 1.58 million Austria 429 591 37,8 172 146 -15,1
+ Strongly positive operative cash flow (+50.0%) to Italy 75 12 -84 47 12 -74,5
EUR 5.4 million Rest of Europe / USA 1,136 1,737 52,9 868 1,021 17,6
+ Increase of liquid assets by EUR 2.3 million to Arabien region 860 30
EUR 13.9 million Total 18,829 20,731 10,1 9,316 10,403 11,7
Sales by
divisions
01/01/ - 01/01/ - ∆ in
04/01/ -
04/01/ -
∆ in
06/30/09
06/30/10
% 06/30/09 06/30/10 %
KEUR KEUR KEUR KEUR
Healthcare Software 16,667 18,510 11,1 8,278 9,408 13,7
Healthcare Service 2,162 2,221 2,7 1,038 995 -4,1
Total 18,829 20,731 10,1 9,316 10,403 11,7

Interim Report - Result: Continued essential Increase

We were able to continue the positive development of results of the last years during the reporting period. The result before taxes improved by 60.6% to KEUR 1,576 (1st half-year 2009: KEUR 981).

We were also able to improve the EBITDA by approx. 21% from KEUR 3,359 to KEUR 4,073. It should be noted here that one-time effects and expenses for company integration are also represented in their complete amount in the operating result this year. Development costs were capitalized unchanged and amounted to KEUR 2,234 in the first half year. At the same time, intangible assets were written off in the amount of KEUR 2,733.

The Healthcare Software segment with a result before taxes of KEUR 1,391 following KEUR 602 was much higher than in the previous year (+131%), while the Healthcare Service segment

recorded a decrease in its result to KEUR 185 (previous year: KEUR 380). The reasons for this decline are especially due to accounting procedures.

The operative cash flow of KEUR 5,412 is approx. 50.0% higher than the previous year's level at (1st half year 2009: KEUR 3,608). The liquid assets of NEXUS AG increased further and were EUR 13.86 million as of 30 June 2010 (12/31/2009: € 11.52 million).

The number of employees increased by 6 compared to the previous year to the current number of 362. The increase in was mainly in the Healthcare Software area.

Innovation: NEXUS / INOVISION – Fast Picture Management with Comprehensive Findings

The NEXUS radiology solution stands for perfect interaction of structured patient management, comprehensive documentation of findings and secure archiving. Standardized interfaces to HIS and imaging equipment ensure manufacture-independent exchange of data. These factors guarantee optimization of your radiological processes. With the new version 5.2.0, NEXUS / INOVI-SION is again taking a leading market position with respect to functions. Two new projects were won directly at the market launch.

NEXUS / INOVISION also supports users from existing systems and consequently provides integrated picture access. Optimum workflow from the availability of current and previous pictures and all the way to their availability to ward doctors is thus ensured with NEXUS / INOVISION. High-performance X-ray demonstrations for radiologists to conduct efficient discussions with and about patients are supported optimally and very flexibly by specific demonstration lists. These are arguments, which were also convincing for two hospitals, which decided in favor of the new NEXUS / INOVISION almost simultaneously with their introduction to the market. The two customers, which are highly regarded in the industry, cannot be named due to blocking periods. The extent to which their decisions will support our success in the hotly contested radiology market will be seen in the near future.

Easy-to-operate tools make complex diagnosis procedures possible using X-rays. The multifaceted options for interacting with the picture data and for specific presentation depending on the user (hanging protocols) provide means for individual optimization of efficient establishment of findings. The functions for patient CDs, export and printing enable forwarding pictures precisely depending on requirements. Pictures can be sent internally or externally, additionally guaranteeing the shortest paths to the right decisions. Web-based picture distribution and consideration is possible throughout hospitals and between different hospitals, and encoding provides a high degree of security at the same time. Easy access is made possible for all involved thanks to standard browsers such as Microsoft Explorer and Mozilla Firefox. Examination-related retrieval of pictures and findings is easy and can be integrated into any ward applications.

NEXUS / INOVISION: New Version launched successfully on the market.

Although the market launch of the new version NEXUS / INOVISION 5.2.0 started very successful with two new projects.

New functions, for example, the new 3D navigation

The new 3D visualization solution for picture diagnosing as well as processing digital X-rays and cross-section images help hospital staff to improve diagnosis possibilities and make them considerably faster. The 3D navigation enables display of the sublayers of associated series of a study using lines, which can be completely added, switched off and suppressed selectively in the viewer. In addition, a specific point can be selected in a series with the 3D navigation, to which the other associated series are aligned automatically. This makes simpler orientation possible in examinations of the spinal column, for example.

NEXUS in the Environment of Financial and Health Markets

Following the opening price of € 3.30 at the beginning of the year and an increase by the middle of January up to € 3.75, NEXUS shares declined in value from the middle of January until the end of March. Prices ranged from € 3.40 to € 3.70 during this phase. The price started to drop strongly at the beginning of April until it even fell below € 3.00 in the middle of May. Prices of NEXUS

Finance- and Event schedule 2010
(status quo: August `10)
FINANCE SCHEDULE
Quarterly Report - third quarter November 8
German equity forum, Frankfurt (D) November 22 - 24
EVENT AND TRADE FAIR SCHEDULE
eHealthcare congress, Nottwil (CH) September 22 - 23
IFAS, Zurich October 26 - 29

KTQ-Forum, Berlin November 26 - 27 MEDICA & BeraterDialog, Düsseldorf November 17 -20 DGPPN, Berlin November 24 - 27

shares again rose to the spring level of € 3.50 from the middle to the end of May. There was another decline in this range until the beginning of July. The share price rose again in July to more than € 4.00 for the first time in three years. The share price is currently approximately at this value. Compared to the course of the TecDax index from the beginning of the year until now, NEXUS shares have performed very positively with a further development of approx. +20% compared to -10% of the TecDax index.

Decisions for NEXUS-solutions 2010

    • Kliniken an der Paar, Aichach
    • St. Josef-Hospital, Bochum
    • St. Josefs-Hospital, Dortmund
    • Städtisches Krankenhaus, Eisenhüttenstadt
    • Kreiskrankenhaus Eschwege
    • Katholische Kliniken, Essen
    • Gemeinschaftspraxis für Pathologie, Fulda
    • Gelderland-Klinik, Geldern
    • Fachkrankenhaus Christophsbad, Göppingen
    • Kreiskrankenhaus Grevenbroich
    • Klinikum, Gütersloh
    • Gemeinschaftspraxis für Rad. und Nuklearmed., Cologne
    • Radiologie Köln-Kalk, Cologne
    • Gesellschaft für Parität. Sozialarbeit, Mainz
    • Krankenhaus Ludmillenstift, Meppen
    • Gemeinschaftspraxis für Pathologie, Mühlhausen
    • Rotkreuzklinikum, Munich
    • Ortenau Klinikum, Offenburg
    • St. Josefsklinik, Offenburg
    • Kreisklinik am Steinenberg, Reutlingen
    • Psychiatrisches Zentrum, Rickling
    • Klinikum Obergöltzsch, Rodewisch
    • Vinzenz von Paul Hospital, Rottweil
    • Kardinal Schwarzenberg'sches Krankenhaus, Schwarzach
    • Pathologische Praxis, Spaichingen
    • Diakonie-Klinikum, Stuttgart
    • Gemeinschaftspraxis für Pathologie, Stuttgart
    • Vinzenz von Paul Kliniken Marienhospital, Stuttgart
    • St. Anna Krankenhaus, Sulzbach-Rosenberg
    • Gesundheitszentrum, Treuchtlingen
    • Radiologische Praxis, Trier
    • Kliniken des Landkreises Weißenburg-Gunzenhausen
    • Klinikum Wels-Grieskirchen, Wels
    • Lahn-Dill-Kliniken, Wetzlar
    • Missionsärztliche Klinik, Würzburg
    • AZ Ziekenhuis St.-Dimpna, Geel (BE)
    • Centre Hospitalier de Mouscron, Mouscron (BE)
    • Hôpital Cantonal, Fribourg (CH)
    • Kantonsspital, Liestal (CH)
    • Hôpital Psychiatrique Cantonal de Marsens, Marsens (CH)
    • Dronning Ingrids Hospital, Nuuk (DK)
    • Hospital Hispania, Madrid (ES)
    • Hospital Clinico Universitario de Valladolid, Valladolid (ES)
    • Sykehuset Innlandet, Gjøvik (NO)
    • Rikshospitalet, Oslo (NO)
    • St. Olavs Hospital, Trondheim (NO)

Intermediate Annual Report Group Informationen and Outlook

Directors Holdings

The Director's Holdings of the supervisory board and the executive board were as follows on June 30, 2010 in comparison to the previous year: see to the right

Chances and Risiks

8

We were able to complete the first half year very successfully. Sales increases of 10.1% and an increase of the result before taxes of 60.6% are very pleasing results. The same applies to the cash flow, which is very noteworthy for the first half year at EUR 5.4 million. Although we already had outstanding increase rates in the previous years, we have still been able to improve our figures continually. But the challenge remains to keep these increase rates in the current year. We are going into the second half year confident that the reason for our good development is our long-term orientation and that is not due to short-term effects. Consequently, our confidence is based on our product program and the market feedback, which we get from our customers. Especially the order successes in Germany of the past months demonstrate that we are seen very positively on the market at this time. We see potential here that goes far beyond that which we have already achieved. However, we first have to push forward our ambitious development projects and challenging customer projects. They are critical for the success of our future development, and it will be a matter of working on them with all our might. It is obvious that the NEXUS staff has the will to success and commitment to invest the energy required to make our goals into a reality.

Financial situation

There are no significant changes in the financial situation of the group compared to 12/31/2009.

Directors Holdings Number of
stock owned
Numbers of
options

SUPERVISORY BOARD

Dr. jur. Hans-Joachim König 99,239 0
Prev. year (81,099) Previous year (0)
Prof. Dr. Alexander Pocsay 121,500 0
Prev. year (0) Previous year (0)
Erwin Hauser 15,000 0
Prev. year (15,000) Previous year (0)
Prof. Dr. Ulrich Krystek 0 0
Prev. year (0) Previous year (0)
Dipl.-Betriebswirt (FH) 0 0
Wolfgang Dörflinger Prev. year (0) Previous year (0)
Matthias Gaebler 0 0
Prev. year (0) Previous year (0)

EXECUTIVE BOARD

Dr. Ingo Behrendt 112,000 57,000
(MBA) Prev. year (112,000) Prev. year (149,154)
Ralf Heilig (MBA) 129,350
Prev. year (129,350)
6.000
Prev. year(30,000)
Edgar Kuner 264,051 6.000
(Dipl. Ingenieur) Prev. year (264,051) Prev. year (25,000)

Facts and Figures Group P+L Account as of 06/30/2010 and 06/30/2009 (IFRS)

Consolidated Profit and Loss
Acc
ount
04/01/ -
06/30/10
04/01/ -
06/30/09
01/01/ -
06/30/10
01/01/ -
06/30/09
KEUR KEUR KEUR KEUR
Revenue 10,430 9,316 20,731 18,829
Increase / decrease in finished goods and work in progress -67 -6 -67 -31
Other capitalized company work 1,221 941 2,234 1,953
Other operating income 1,424 1,059 1,736 1,440
Cost of materials 3,198 2,110 4,931 4,239
Personnel expenses 5,832 5,364 11,442 10,585
Depreciation and amortization of fixed intangible and tangible assets 1,399 1,284 2,733 2,563
Other operating expenses 1,940 2,173 4,188 4,008
OPERATING
INCO
ME
612 379 1,340 796
Expenses from associated companies 0 0 0 0
Interest and similar income 160 57 263 200
Interest payable and other similar charges 23 4 27 14
PROFIT BEFORE
TAX
749 432 1,576 982
Income taxes -122 43 38 133
PERIO
D RES
ULT
871 389 1,538 849
Actuarial profits and losses (after taxes on profit) -9 4 -19 8
Differences from the conversion of foreign currency 137 -47 143 -81
Market value changes from assets available for sale
(after taxes on profit)
-28 204 52 148
OTHER
OVERALL
RES
ULT
100 161 176 75
OVERALL
RES
ULT
OF THE PERIO
D
971 550 1,714 924
Of the period result, attributed to:
- Stockholders of NEXUS AG
- Minority interests
871
0
363
26
1,498
40
803
46
Of the overall result, attributed to:
- Stockholders of NEXUS AG 971 524 1,674 878
- Minority interests 0 26 40 46
PERIO
D RES
ULT PER
SHARE
IN EUR
Weighted Average of Issued Shares in Circulation 13,797 13,797 13,797 13,797
(in Thousands)
- simple
0.07 0.03 0.11 0.06
- diluted 0.07 0.03 0.11 0.06

Facts and Figures Balance sheet as of 03/31/2010 and 12/31/2009 (IFRS)

Assets 06/30/2010 12/31/2009
KEUR KEUR
Long-term cap
ital
Goodwill 11,642 11,642
Other intangible assets 16,819 16,629
Fixed Assets 1,035 1,079
Shares in affiliated companies 98 98
Credited deferred taxes 2,609 2,486
Other financial assets 79 98
Total long-term cap
ital
32,282 32,032
Short-term cap
ital
Inventories 187 169
Trade receivables and other receivables 12,727 12,588
Receivables from tax on profits 181 350
Other non-financial assets 1.386 552
Other financial assets 1,526 1,577
Securities 2.055 1.981
Cash and balance in bank 11,802 9,538
Total Short-term cap
ital
29,864 26,755
Total Assets 62,146 58,787

Facts and Figures Balance sheet as of 06/30/2010 and 12/31/2009 (IFRS)

Total Liab
ilities
06/30/2010 12/31/2009
Equity cap
ital attribu
tab
le to stockh
olders
KEUR KEUR
of the parent compa
ny
Subscribed capital 13,805 13,805
Capital reserve 39,523 39,523
Net loss for the year -4,397 -5,895
Other cumulated Group result -433 -608
Own shares -26 -26
Equity cap
ital attribu
tab
le to stockh
olders
of the parent compa
ny
48,472 46,799
Minority interest 283 243
Total Equity 48,755 47,042
long-term liab
ilities
Pension provisions 674 610
Other provisions 1,223 1,018
Total long-term liab
ilities
1,897 1,628
Short-term liab
ilities
Deferments 1,893 776
Financial liabilities 4 290
Trade accounts payable 2,194 3,515
Liabilities from tax on profit 391 80
Deferred revenue liability 3,063 345
Other non-financial debts 742 2,257
Other financial debts 3,207 2,854
Total Short-term liab
ilities
11,494 10,117
Total equity
and liab
ilities
62,146 58,787
Cas
h Flow
2010 2009
1. Cash Flow from operating activities KEUR KEUR
Profit before tax 1,576 981
Depreciation and amortization of intangible assets and plant,
equipment and other fixed assets 2,733 2,563
Other expenses / income with no impact on cash -106 -314
Depreciation of financial assets -18 35
Profit / loss from disposal of long term capital 0 0
Profit / loss from disposal of securities 0 136
Increase / decrease in trade receivables and other assets that cannot be -1,057 -2,219
allocated to investing or financing activities
Changes in provision
823 651
Increase / decrease in trade accounts payable and other liabilities that cannot be
allocated to investing or financing activities 1,052 1,504
Interest paid -27 -14
Interest payments received 279 142
Income taxes paid -37 -92
Income taxes received 194 235
5,412 3,608
2. Cash Flow from INv
estment activities
Cash paid for investments in property, plant and equipment / intangible assets -2,860 -3,027
Cash receipt for investments in financal assets 0 0
Cash paid from disposal of fixed assets 0 0
Cash paid from purchase price adjustments at subsidiaries 0 0
Acqusition of consolidated companies, net of purchased cash 0 -252
Cash receipts from disposal of securities 0 2,529
Cash paid for investments in securities 0 0
-2,860 -750
3. Cash Flow from financing activities
Dividends paid to minority shareholders
Payments into equity capital via exercise of stock options
0
0
0
0
Purchase of own shares 0 0
Payments for taking loans within the context of short-term payment disposal 0 0
Cash receipts from issuing short-term loans -286 135
-286 135
4. Cash
and cash equiva
lents at end of fiscal year
Cash-relevant changes in cash and cash equivalents (sum of 1 + 2 + 3) 2,266 2,993
Change in currency translation adjustment 2 33
Consolidation circle-conditional change of financial funds 0 0
Cash and cash equivalents at beginning of fiscal year 9,538 4,141
11,806 7,167
5. Composition of cash
and cash equiva
lents
Cash on hand 11,802 7,413
Bank liabilities due on demand 4 -246
11,806 7,167

Facts and Figures Development of Group Equity as of 03/31/2010 and 03/31/2009 (IFRS)

develop
ment of
group
equity
capital
ubscribed
S
reserves
apital
C
provisions
ther
O
from
conversion
diference
curency
quity
E
financial
nstruments
for
eserve
R
I
pensions
for
eserve
R
loss
forward
onsolidated
carry
C
profit
onsolidated
deficit /
C
tock
reasury S
T
to
company
attributable
parent
cap ,
of
stockh,
quity
E
interest
inority
M
equity
otal
T
capital
uthorized
A
13
KEUR KEUR KEUR KEUR KEUR KEUR KEUR KEUR KEUR KEUR KEUR KEUR KEUR
Consolida
ted equity
as of 12/31/2008
13,805 39,483 0 59 -999 -72 -9,503 1,488 -26 44,235 259 44,494 6,860
Transfer of 2008 consolidated
loss to consolidated
loss carry-forward
1,488 -1,488 0 0
Total income entered directly
in equity capital
-79 147 8 -1 74 74
Profit before tax 03/31/2009 803 803 46 849
Overal result of the
period
0 0 0 -79 147 8 0 803 -1 877 46 923
Stock-based payment 27 27 27
Consolida
ted equity
on 06/30/2008
13,805 39,510 0 -20 -852 -64 -8,015 803 -27 45,140 305 45,445 6,860
Consolida
ted equity
on 12/31/2008
13,805 39,523 0 59 -558 -109 -8,016 2,119 -26 46,799 243 47,042 6,860
Profit before tax 2009 entered
directly in accumulated deficit
2,119 -2,119 0 0
Total income entered directly
in equity capital
143 51 -18 176 176
Profit before tax 03/31/2010 1,498 1,498 40 1,538
Overal Result of the
period
0 0 0 143 51 -18 0 1,498 1,673 40 1,713
Stock-based payment 0 0
Consolida
ted Equity
on 03/31/2010
13,805 39,523 0 202 -507 -127 -5,897 1,498 -26 48,472 283 48,755 6,860

Notes to the consolidated interim financial statements

1. Accounting and Valuation Method

This interim report from the NEXUS Group of 30 June 2010 has been prepared in keeping with the International Financial Reporting Standards (IFRS) as they are applied in the EU. The interpretation of the International Financial Reporting Interpretation Committee (IFRIC) has been taken into account.

The regulations of IAS 34 have been observed in the interim report of 30 June 2010. This refers to a summarized report, which does not contain all information of an IFRS Group Financial Statement, and consequently this report should be read in connection with the Appendix of the Group Financial Statement 2009. The same accounting and valuation methods were used in the Group Financial Statement for the business year 2009.

The Group Financial Statement 2009 and the interim report of 30 June 2009 can be seen on the homepage in the Internet at:

http://www.nexus-ag.de .

2. Consolidated Group

In addition to the NEXUS AG as parent company, all operatively active domestic and foreign subsidiaries are included in the Group Financial Statement, for which NEXUS AG has the majority of voting rights directly or indirectly.

Four affiliated companies were included in the balance sheets according to the equity method.

The report has not been audited.

List
of
subsidiaries
consolidated
06/30/2010 06/30/2009
Shares
of Capital
in %
Full
consolidation
NEXUS / CIS GmbH. Singen 100.00 100.00
NEXUS / CSO GmbH. Villingen-Schwenningen 100.00 100.00
NEXUS Digitale Dokumentationssysteme
Projektentwicklungsges.mbH. Wien (A)
100.00 100.00
nexus
/ DIS GmbH. Frankfurt am Main
100.00 100.00
NEXUS / HOLL GmbH. Ismaning 100.00 100.00
NEXUS / INOVIT GmbH. Ismaning 91.49 91.49
NEXUS / IT GmbH NORD. Villingen-Schwenningen 100.00 100.00
NEXUS / IT GmbH SÜDOST. Singen 50.20 50.20
NEXUS / IT GmbH SÜDWEST. Villingen-Schwenningen 100.00 100.00
NEXUS Italia S.r.l Bologna (I) 80.00 80.00
NEXUS Medizinsoftware und Systeme AG. Kreuzlingen (CH) 99.98 99.98
NEXUS Schweiz GmbH. Schwerzenbach (CH) 100.00 100.00
Equity
-consolidation
G.I.T.S Gesundheitswesen IT-Service GmbH.
Fürstenfeldbruck
49.00 49.00
Medidata GmbH. Berlin 25.00 25.00
Paladium-med GmbH. Berlin 20.00 20.00
NEXUS Arabia Ltd Riyadh 50.00 50.00
VEGA Software GmbH. Aachen 30.00 30.00

3. Trade accounts receivable and other Assets

IN KEUR 06/30/2009 12/31/2009 06/06/2010
short-termed long-termed short-termed long-termed short-termed long-termed
(< 1 year) (> 1 year) (< 1 year) (> 1 year) (< 1 year) (> 1 year)
Trade
accounts
receivable
12,422 - 12,021 - 12,590 -
Receivables
from
affiliated
companies
12 - 0 - 0 -
Gross
Amount
Due
to Customers
for
Projects
as
an Asset
0 567 - 137
Other
Assets
1,641 1,258 415 1,162 1,864 1,048
from interests of not payable stocks 36 - 0 0 0 -
from accounts receivable in the range of
value added tax
29 - 0 0 43 -
from loans to employee and third party 10 1,078 3 936 3 1,078
from loans to parent company 5 180 52 226 11 180
from other 1,561 - 360 0 1,807 -
Tags
Refund
Claims
307 - 315 0 181 -

The other assets are not interest-bearing and normally are due between 30 and 360 days. Loans to third parties have interest rates of 3.5% and 5% and are normally safeguarded. Receivables from deliveries and services are not interestbearing and normally are due between 30 and 90 days.

There were receivables from deliveries and services in the amount of KEUR 1,067 30 June 2010 (30 June 2009: KEUR 968) diminished in value. The development of the value adjustment account is as follows:

ADJUSTM
ENT
ACCOUNT
06/30/09 12/31/09 06/30/10
KEUR KEUR KEUR
Status January, 1st 968 968 1,067
Allowed expenses allocation 40 696 385
Consumption -399 -170 -323
Dissolution -49 -427 -15
status
- end
of
period
560 1,067 1,114

4. Securities

SECURITI
ES IN KEUR
06/30/2009 12/31/2009 06/30/2010
purchase
costs
market
value
purchase
costs
market
value
purchase
costs
market
value
Corporate bond 1,090 1,008 0 0 0 0
Money market bond 2,014 1,418 2,014 1,724 2,014 1,747
Shares in funds 719 228 719 257 719 308
TOTAL 3,823 2,654 2,733 1,981 2,733 2,055

There were no impairments of value to enter in the reporting year or the previous year.

A valuation reserve for financial instruments was established in equity capital, which shows the profits or losses from the sale of available financial assets minus the deferred taxes applicable to them.

5. Current Liabilities

IN KEUR 06/30/2009 12/31/2009 06/30/2010
short-termed
long-termed
short-termed long-termed short-termed long-termed
(< 1 year) (> 1 year) (< 1 year) (> 1 year) (< 1 year) (> 1 year)
Bank
loans
246 - 290 - 4 -
received
Order
deposits
557 - 1,483 - 501 -
liabilities
from
deliveries
and
services
2,677 - 3,515 - 2,194 -
Liabilities
with
associated
companies
- - - - - -
Tax Liabilities 606 - 853 - 391 -
Other
Liabilities
2,045 - 2,854 - 3,448 -
for obligations for salary payments 1,423 - 2,060 - 1,907 -
for liabilities of social securities 108 - 130 - 338 -
Others 514 - 664 - 1.203 -

Conditions of the financial liabilities listed above:

.

  • • Liabilities to banks serve solely for short-time payments. Interest due here is paid monthly.
  • • Average down payments on orders are offset after 12 months.
  • • Liabilities from deliveries and services are not interest-bearing and normally are due with 30 days.

6. Segment reporting

BUSINESS
SEG
MENTS
REPORTING
AS OF 30 JUNE
HEALTHCARE
SOFTWARE
HEALTHCARE
SER
VICE
KONSOLI
DIE
RUNG
KON
ZERN
2010 2009 2010 2009 2010 2009 2010 2009
KEUR KEUR KEUR KEUR KEUR KEUR KEUR KEUR
Sales with third parties 18,510 16,667 2,221 2,162 20,731 18,829
-Deliveries 619 756 528 763 1,147 1,519
-Services 4,828 3,495 1,224 1,022 6,052 4,517
-Software updating and hardware
maintenance
8,521 8,000 224 248 8,745 8,248
-Licenses 4,542 4,416 245 129 4,787 4,545
Sales between segments 2,854 1,639 250 533 -3,104 -2,172
Segment sales 21,364 18,306 2,471 2,695 -3,104 -2,172 20,731 18,829
Operating segment result 1,391 402 185 380 1,576 982
Segment assets 44,777 43,266 817 1,010 45,594 44,276

Segmenting according Business Divisions

The Group is split into business units according to products and services for the purpose of company management and has the following business segments required to file reports:

Healthcare Software

In the areas NEXUS / CIS, NEXUS / CSO, NEXUS / DIS and NEXUS / HOSPIS (Switzerland), software solutions for the healthcare system are developed and marketed in administrative and medical areas. NEXUS provides a hospital information system (HIS) with its core product NEXUS / HIS for the medical sector. The counterpart product NEXUS / PSYCHIATRY is offered for psychosomatic institutions. We provide all administration applications for the Swiss market with the product line NEXUS / HOSPIS.

Highly specialized solutions are available for radiology, gynecology including obstetrics, pathology and cytology. The leading system for QM assessment of all customary processes (NEXUS / HOLL) has also been assigned to this area. NEXUS also expanded its portfolio for quality management software with the product NEXUS / CURATOR.

Healthcare Service

The Healthcare Service Division covers the services, which are provided by NEXUS / IT companies. These including consulting for hospital IT departments, configuration of network, Intranet and Internet solutions, security concepts and the management of IT services with the context of the service company G.I.T.S. Gesundheitswesen IT-Service GmbH, Fürstenfeldbruck.

The Group is mainly controlled according to business divisions due to the chance and risk structure. Consequently, the division according to business divisions is the primary segmentation level.

Transactions between the segments are mainly debited as procurement or manufacturing costs.

6. Seasonal Influences on the Business Activities

Seasonal effects resulted in the NEXUS Group operations with regards to the receipt of maintenance revenues in the first quarter of the financial year (deferment of the influences on the result of corresponding incoming payments throughout the year) and significantly greater demand and project accounting in the fourth quarter of the financial year.

Declaration according to § 37y No. 1 WpHG

To the best of our knowledge, and in accordance with the applicable reporting principles for interim financial reporting, the interim consolidated financial statements give a true and fair view ot the assets, liabilities, financial position and profit or loss 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 ot the principal opportunities and risks associated with the expected development of the group for the remaining months of the financial year.

Villingen-Schwenningen, August 16, 2010

NEXUS AG Executive Board

NEXUS AG, Auf der Steig 6, D-78052 Villingen-Schwenningen Telefon +49 (0)7721 8482 -0, Fax +49 (0)7721 8482-888 www.nexus-ag.de, [email protected]

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