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Talenthouse AG

Annual Report Jun 26, 2009

939_10-k_2009-06-26_4a1e8d39-c864-4b83-a94c-b4d3ad03c31a.pdf

Annual Report

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2008/2009

Annual Report Sustainable Swiss Private Equity

This document contains a selection of translated excerpts from the german version. For full information complying with the legal standards and regulations, please revert to the official «Geschäftsbericht 2008/2009».

4 Preface 6 The Year In Review 10 Information for Investors 12 Portfolio Companies 23 Annual Statement According to IFRS 24 BALANCE SHEET

25 INCOME STATEMENT

Published by New Value AG, Zurich Concept IRF Communications AG, Zurich Design Michael Schaepe Werbung, Zurich, Photos Daniel Gerber, Mirjam Kluka / Bronx Fotografen Production MDD Management Digital Data AG, Schlieren Printing NZZ Fretz AG, Schlieren

Careful and sustainable handling of nature and its resources is important to New Value AG. For this reason the business report 2008/09 has been printed on paper which comprises at least 50% recycling fibres and at least 17.5% fresh fibres from certified forestry (FSC).

Approved in the time of crisis

In the Private Equity sector, what should actually be the driving force behind the industry has instead become a risk factor: investors. Renowned private equity firms are being forced to sell off their assets at auction prices. Rather than focusing on the medium- and long-term potential for success of individual holdings, investors are more interested in their value in the here and now, as well as in how easily positions can be liquidated. Liquidity has become absolutely essential, as banks call in their loans and fund investors call in their shares.

It would be presumptuous to say that New Value has not been affected by the financial and economic crisis. The effects of this harsh climate are reflected in New Value's

stock price as well as that of our two publicly-traded holdings. Regrettably, the substantial price drop in shares of 3S Industries, proportionately New Value's largest position, has forced us to report a loss for the 2008/09 financial year. Nevertheless, 3S Industries' price loss fails to reflect the great strategic and operational strides that the company has made. These are described in detail in this report. In fact, in the weeks between New Value's balance sheet date and the printing of this report, shares of 3S rose by almost 80%, compensating for a large portion of our annual loss.

Equally noteworthy has been our ability to avert a series of problems that have plagued some of our competitors. This is especially true with regard to our financing structure. New Value is completely reliant on its own capital. Even our holdings utilize little or no borrowed capital. Thanks to our corporate structure, occasional drops in the demand for New Value securities do not impact our holdings portfolio. Our holding company status is thus proving to be a useful tool during times of crisis as well.

Our solid financing practices allow us to support the promising companies in our portfolio with additional growth capital. During the reporting period, New Value has taken part in capital increases for Solar Industries, Bogar and Silentsoft. In addition, New Value acquired a substantial share in Qualilife, a developer of IT solutions that help the elderly and disabled use computers. As in the past, we continue to possess enough liquidity to take advantage of new growth opportunities for our portfolio.

In addition to capital, New Value also provides leadership experience. We make it our duty, not only as financing specialist, but as a business collaborator and promoter, to contribute to the success of the companies we work with. One example of this is our involvement with Colorplaza. Last June, the company was acquired by the FotoDesk Group, with active participation by New Value. In a multi-stage transaction, which included growth financing, New Value

PREFACE 5

became a shareholder of the FotoDesk Group. The new company has favorable prospects in the dynamic digital photography market.

In the last twelve months, we have not only invested – we have also reaped the benefits of our investments. Last summer, New Value sold around 10% of its holdings in 3S Industries at then still-favorable prices. In light of current low market valuations, we must count on longer holding periods for our investments.

After this exciting and at times stressful financial year, on behalf of the Board of Directors, I would like to thank all our shareholders for their trust and – as must be emphasized in these times – their risk capacity. We are confident that our portfolio companies are well positioned thanks to their sustainable business models. I would also like to thank the EPS Value Plus team for their diligence in supervising and expanding our holdings portfolio.

Best regards,

Rolf Wägli President of the Board of Directors

The year in review

NAV decline more moderate than overall market – solid financing – proven investment concept

Annual loss compensated for in the first few months of the new fiscal year

New Value closed the 2008/09 financial year with an annual loss of CHF 13.99 million. The loss was primarily due to valuations for its two publicly-traded portfolio companies, particularly 3S Industries. This same factor had led to an annual profit in the previous year of CHF 22.31 million. A loss per share of CHF 4.91 was registered for the reporting period versus a profit per share of CHF 7.78 in the previous year. Net asset value (NAV) saw a similar development, ending the year at CHF 21.76 million, or 20.5% below the previous year.

This high annual loss merits an in-depth analysis. 3S Industries accounts for a significant part of New Value's valuation, thanks to the company's great success. At the end of the 2007/08 financial year, shares of 3S were priced at CHF 18.50, representing an important factor in our valuation. On March 31, 2009, New Value's balance sheet date, shares of 3S Industries were valued at CHF 9.95. By June 10, 2009, when this report went to print, shares in 3S had risen by 79.4 to CHF 17.85, compensating for a majority of the difference in valuation that led to the 2008/09 loss. New Value's balance sheet date therefore reflects a past value that is no longer relevant. It has been replaced by a more realistic representation. The decline in market valuation does not reflect the positive developments that have taken place at 3S Industries.

The example shows that New Value has been quite favorably and at times unfavorably influenced by the success of 3S Industries. In order to reduce this influence over time, New Value did not acquire any new shares during 3S Industries' major capital-raising initiative in the summer of 2008. To the contrary, New Value sold shares in 3S in the reporting year at favorable prices, as described in the pages that follow. New Value also invested in other companies in its portfolio and identified a new addition. All indications are that this seed with grow as well. Indeed, hard work will be required – along with a bit of occasional patience.

Operational highlights: New investment in Qualilife SA

New Value's only new investment in the reporting period is quite characteristic of its selection criteria: Qualilife SA, a Lugano-based software company that provides IT solutions for the elderly and disabled, is banking on a megatrend as well as a socially sustainable business concept. Qualilife software improves quality of life for disabled persons by allowing them to use computers without hindrance. The software platform is also used in hospitals, where it provides patients access to both modern communication and information media such as the internet and administrative applications. To finance the continued growth of Qualilife, New Value is investing CHF 2.0 million in three increments.

Subsequent financing for Solar Industries, Bogar and Silentsoft

Solar Industries AG made great strides in the reporting period. Its strategy remains unchanged: to build a group of companies along the entire value chain of solar module manufacturing and industrially integrate them. To this aim, in the spring of 2008, Solar Industries established a partnership with the Italian-based MX Group, a producer of photovoltaic modules and manufacturer of solar power plants. Solar Industries is currently investing in the construction of production centers for modules (MX Panel) and solar cells (Solarcell) for the Italian and greater European market. To finance these initiatives, Solar Industries successfully raised over CHF 5 million in capital in the reporting year. New Value invested CHF 2 million, increasing its share in the company's capital stock from 31.3% to 33.1%.

Bogar AG also increased its capital in 2008. Of a total of CHF 7 million, New Value contributed CHF 2.2 million, increasing its share in Bogar from 16.6% to 29.8%. The newly subscribed capital was received in cash or against settlement of existing loans. Bogar, an animal health and nutrition firm, will use the additional funds to expand its sales structures and develop new products. Bogar is also profiting from the momentum of the last several months. The company has practically doubled its 2008 sales figures. Among its top-selling products are its flea treatment for dogs and its flea treatment for cats, the latter introduced in 2008. Both products are based on innovative combinations of natural active ingredients derived from select plants.

New Value's third substantial additional financing initiative in the 2008/09 financial year was for Silentsoft SA. The company operates so-called "machine to machine" (M2M) remote monitoring networks for building management and geographically-distributed containers for liquids or powder. Sensors measure the water level in tanks, for instance, and deliver the data in periodic intervals to the central server. These consolidated, web-accessible data allow customers to optimize their logistics processes, avoid delivery routes and save costs. New Value increased its investment of CHF 2.2 million in the company with a capital increase of CHF 1 million and acquired a block of shares from an existing shareholder. Its share in the company is now 25.7%. Venture Incubator and other previous shareholders also contributed a total of CHF 1 million.

Gradual business development among portfolio companies

In the 2008 financial year, 3S Industries continued to lived up to its reputation as a role model in its industry. Its gross sales quadrupled over the previous year to CHF 108.7 million from CHF 26.3. Operating results (EBIT) reached a record CHF 12.5 million (previous year: CHF 2.6 million), a nearly fivefold increase, while the EBIT margin based on net sales rose to 12.3% (previous year: 10.4%). By acquiring Somont, the solar firm gained access to key technologies that are important for the manufacture of solar modules. Further growth is expected. The solar firm expects group sales of CHF 150 million and EBIT of CHF 15 million in 2009.

Colorplaza SA was acquired by FotoDesk Group AG. Its unique online photo service encompasses photo printing and editing as well as digital photo sharing and archiving. New Value exchanged its shares in Colorplaza for shares in FotoDesk and invested CHF 1.0 million in growth financing capital and CHF 0.8 million in the form of a convertible loan. New Value now holds 45% of FotoDesk Group AG.

Swiss Medical Solutions AG made further progress in both organizational as well as business matters. Operational management capacities were increased through the addition of Dr. Thomas Kaltenbach, an experienced CEO in the industry. The Board of Directors also welcomed its new president, Marc Neuschwander, former CEO of Bayer Switzerland. The new leadership will support the company's upcoming growth efforts. The in-vitro diagnostics firm also established new distribution partnerships for the Swiss and German markets. In the course of these developments, New Value increased its share in Swiss Medical Solutions from 15.2% to 38.9% and granted an additional convertible loan of CHF 0.9 million.

Investment portfolio as of 3/31/2009

Company Title Number
of shares/
nominal
Currency Market
price per
3/31/2009
+/- vs.
3/31/2008
Market Share of
value CHF 1) portfolio 2)
Company
share
Renewable Energies/Solar Technology
3S Industries Shares 1,517,349 CHF 9.95 [-46.9%] 15,097,623 23.0% 10.9%
Solar Industries Shares 1,554,100 CHF 5.00 +28.2% 7,770,500 11.8% 33.1%
Meyer Burger Technology Shares 1,000 CHF 116.60 -61.8% 116,600 0.2% 0.1%
Medtech
Idiag Shares 6,346,100 CHF 1.20 0.0% 7,615,320 11.6% 45.5%
Swiss Medical Solution Shares 311,581 CHF 5.00 -76.6% 1,557,905 8.9% 39.0%
Convertible loan 907,000 CHF 476.01% 376.0% 4,317,407
Health
Mycosym International Shares 194,337 CHF 21.75 -33.3% 4,226,830 7.1% 49.1%
Loan 457,648 CHF 100.00% 0.0% 457,648
Bogar Shares 233,795 CHF 30.57 3) 0.0% 7,146,254 10.9% 29.8%
Convertible loan 0 CHF 93.57% 0.0% 0
Loan 0 CHF 100.00% 0.0% 0
Information Technology (IT)
FotoDesk Group Shares 4,502,115 CHF 1.00 0.0% 4,502,115 8.2% 45.0%
Convertible loan 800,000 CHF 107.89% 0.0% 863,098
Qualilife Shares 240,000 CHF 3.00 0.0% 720,000 1.1% 18.2%
Silentsoft Shares 20,312 CHF 176.13 0.0% 3,577,553 5.4% 15.8%
New Materials
Natoil Shares 47,274 CHF 25.38 3) 0.0% 1,200,000 1.8% 23.8%
Loan 240,000 CHF 100.00% 0.0% 240,000 0.4% 23.8%
Total 59,408,852 90.4% 4)

1) As per IFRS, the market value of convertible bonds includes a valuation of the borrowed capital portion at present value per the effective interest method and the option portion.

2) based on market value including consideration of liquid funds and financial investments

3) no change in the stock price based on the average acquisition cost versus the previous year (only absolute change in the price per share with no relevance to overall portfolio valuation)

4) market value/net assets (level of investment)

Active investment manager

EPS Value Plus AG, investment manager for New Value AG, is responsible for the entire operational investment process. In the past financial year, the EPS team was involved in reviewing new investment opportunities, as well as in structuring and carrying out additional financing as described above as well as providing business guidance.

Financial results: Realized earnings from disposals and unrealized depreciation of investments

Income from investments and loans dropped to CHF 6.6 million (previous year: CHF 27.6 million). Of that total, CHF 1.0 million were realized profits from the sale of holdings in 3S Industries AG. Expenditures from investments and loans increased disproportionately over the previous year to CHF 17.7 million (previous year: CHF 2.7 million). This represents primarily unrealized losses from valuation corrections, except for a total of CHF 0.3 million in realized capital losses from the sale of Meyer Burger Technologies AG and additional investment expenditures. The largest portion of these expenditures were value adjustments for 3S Industries totaling CHF 12.9 million. The effective-date valuation of these publicly-traded holdings took place at a low of CHF 9.95 per share. In the meantime, shares of 3S have recovered to CHF 17.85 per share at the time of printing. Theoretical consideration of this price increase in 3S shares would improve annual net income for New Value by CHF 11.9 million.

Operating expenditures increased to CHF 2.85 million (previous year: CHF 2.67 million) due to higher expenditures for investment consultant fees. The latter remained unchanged at 0.5% of audited NAV per quarter but rose in absolute figures due to increased NAV in the previous year. Investment consultant fees are expected to drop further in the coming financial year. Compensation to the Board of Directors fell to CHF 152,850 (previous year: CHF 245,486). Additional operating expenditures remained constant or were slightly reduced.

Portfolio development: Intensive investment development and increased diversification

The relative proportion of renewable energy/solar technology firms in the overall portfolio fell during the reporting period due to sharp losses in value for 3S Industries to 35.0% (previous year: 44.9%). Other well-represented industries in the New Value portfolio include: medical technology at 20.5% (previous year: 12.9%), health at 18.0% (previous year: 15.6%) and information technology at 14.7% (previous year: 6.7%). In contrast, the new materials sector is currently underrepresented. As of March 31, 2009, liquid funds totaled 9.6% (net calculation: liquid funds minus short-term financial liabilities). In the 2008/09 financial year, New Value invested a total of CHF 9.6 million in new and existing portfolio companies and realized CHF 6.1 million in capital gains. New Value boasts extremely solid financing with an own-capital ratio of 97%.

New Value's portfolio grew qualitatively during the 2008/2009 financial year, reaching an increased degree of maturity. The economic environment has had a noticeable impact on New Value's portfolio companies. We consider it highly beneficial, however, for these primarily still relatively young companies to have a solid and active equity partner like New Value by their side. Difficult market conditions and times of upheaval harbor both challenges and opportunities. We are working diligently to ensure that both New Value as well as its portfolio companies can meet these challenges and take advantage of the opportunities.

Peter Letter CEO, EPS Value Plus AG

Information for Investors

Stock Quotes CHF 14.25 (SIX Swiss Exchange) EUR 9.20 (Xetra)

Net Asse Value (NAV) CHF 21.76 per share

Share capital CHF 32.8 Mio.

Issued shares 3 287 233 registered shares (nominal value CHF 10 per share)

Market capitalisation CHF 46.8 Mio.

Listings

SIX Swiss Exchange since May 2006 (previously at the Berne eXchange from August 2000 until December 2006) Xetra, Open Market Frankfurt, Berlin, Dusseldorf, Munich and Stuttgart

Ticker-Symbols NEWN (CH), N7V (DE)

Security identification

Valorennummer 1081986 Wertpapierkennnummer 552932 ISIN CH0010819867

Annual shareholders meeting July 8, 2009 in Zurich

Investment Manager EPS Value Plus AG Zurich (www.epsvalueplus.ch)

Management fee 0.5% per quarter, as measured by the NAV

Performance fee 10%, if > or = 10% growth p.a. 20%, if > or = 15% growth p.a.

Renewable Energy/Solar Technology 3S Industries AG (formerly 3S Swiss Solar Systems AG)

Business segments: Mechanical and process technology for the solar industry, energy-generating construction materials Locations: Lyss BE and Neuchâtel NE, Switzerland, Freiburg and Umkirch, Germany Workforce as of 12/31/2008: 302 fulltime positions Sales 1/1/2008 to 12/31/2008: CHF 109 million (+331%) New Value share as of 03/31/2009: CHF 15.1 million; corresponds to 10.9% of equity New Value Board Representative: Rolf Wägli (President) Website: www.3-s.ch Ticker symbol: BX Bern Exchange: SSS; Open Market Frankfurt: S3V

Brief description

p 3S Industries AG (3S), along with its group companies 3S Swiss Solar Systems, Somont and Pasan, markets cutting-edge production equipment for the manufacture of solar modules worldwide. The group operates along the entire value chain of photovoltaic solar module production and combines key competencies in the area of soldering, laminating and testing under one roof. 3S production equipment guarantees stable processes, high throughput and the highest level of product quality with minimal waste. 3S offers both turnkey, fully-automated production lines as well as individual components. 3S also provides innovative, building-integrated solar energy systems for rooftops, facades or shading.

2008/09 Highlights

  • p 3S once again achieved record results: Gross sales quadrupled over the previous year to CHF 109 million. Operating results (EBIT) increased fivefold to CHF 12.5 million; the EBIT margin based on net sales totaled 12.3% (previous year: 10.4%).
  • p 3S acquired Somont GmbH, the German solar cell stringing machine specialist and manufacturer. 3S helped raise CHF 62 million in additional capital to finance the takeover and for growth financing.
  • p The company welcomed several new members to its Board of Directors: Dr. Patrick Hofer-Noser, CEO of 3S, Rudolf Güdel, CEO of Güdel AG (a high-tech group of companies in the robotics and automation sector with 700 employees worldwide) and Prof. Dr. Konrad Wegener, chair of the Production Technology and Machine Tools department at the Swiss Federal Institute of Technology (ETH) in Zürich.
  • p International expansion continued with the opening of a service and sales company in Tucson, Arizona, USA. In May of 2009, 3S also established group companies in Hong Kong and Singapore, as well as an office in Kun-

shan, China. These new additions to the group have strengthened the company's presence in the dynamic US and Asian photovoltaic markets.

p During the reporting period, New Value sold 263,800 shares at an average price of CHF 22.45 and bought 56,122 shares at an average price of CHF 16.58. New Value thus realized capital gains of CHF 1,043,816.

Value drivers

  • p High industry growth expected, particularly due to "grid parity" for solar power expected in the next few years (competitiveness of electricity costs versus traditional generation methods)
  • p Improved market and technology positioning: Acquisitions of Pasan and Somont accelerate growth and position 3S as an integrated provider of complete solutions for solar module production.
  • p Listing of stock on the SIX Swiss Exchange planned by end of 2009
  • p New Value has financed 3S since its founding; in 2005, it helped the company become listed on the BX Berne Exchange and the Frankfurt Stock Exchange (Open Market).

Valuation

p Valuation at CHF 9.95 per share (previous year: CHF 18.50) corresponds to the market price on March 31, 2009. Share prices fell 46.2% over the entire reporting period amid overall market turmoil and in contrast with operational achievements. As this report went to print on June 10, 2009, the share price had risen to CHF 17.85.

Solar Industries AG Renewable Energy/Solar Technology

Business segments: Solar industry firm operating along the entire value chain of PV solar module manufacturing. Locations: Niederurnen GL, Switzerland and Milan, Italy Workforce as of March 31, 2009: 1.5 full-time positions and external partners (including non-fully-consolidated companies: 218 full-time positions) Sales development 01/01/2008 – 12/31/2008: to be announced New Value share as of 03/31/2009: CHF 7.78 million; corresponds to 33.1% of equity New Value Board

Brief description

p Solar Industries AG invests in existing companies as well as those under development along the entire value chain of solar module manufacturing. Solar Industries strives for a competitive industrial integration of these companies. In Italy, Solar Industries cooperates with the successful MX Group (MXG) headquartered in Milan. The latter operates production facilities for PV solar modules with a capacity of 120 MWp per year. The group is also involved in project development and realization for solar parks. Additional significant investments will be made in establishing production centers for solar cells and solar modules. These investments will focus on the fast-growing Italian market. This market will serve as a platform for the sustainable expansion of the company's activities at a later time into other European markets and overseas.

2008/09 Highlights

  • p Solar Industries entered into a strategic partnership with MXG and acquired a minority interest in the company.
  • p Solar Industries and MXG together founded the company Solarcell. Solarcell plans to build a crystalline solar cell production facility with an initial (nominal) capacity of 30 MW in northern Italy.
  • p In August 2008, Solar Industries announced the signing of a joint-venture agreement with api nòva energia. The two companies seek to launch Italsilicon, which plans to build a silicon factory that will produce high-purity polysilicon for photovoltaic applications.
  • p At the end of 2008, Solar Industries successfully raised CHF 5 million in new capital. New Value invested CHF 2 million, slightly increasing its share in the company's capital stock to 33.1%. The new funds will be used to actively develop existing industrial investments.

Value drivers

  • p The solar market in Italy is one of the most attractive growth markets in Europe due to high solar radiation and supportive measures by the government.
  • p Opportunities along the entire value chain for solar module manufacturing with access to marketing organizations
  • p Collaboration with knowledge partners in Switzerland and surrounding countries.

Valuation

p Valuation was increased to CHF 5.00 per share (previous year: CHF 3.90). This corresponds to the price during the last capital increase in December 2008.

Renewable Energy/Solar Technology

Meyer Burger Technology AG

Business segments: Mechanical and process technology for the solar industry Locations: Baar ZG and Steffisburg BE, Switzerland Workforce as of 12/31/2008: 630 full-time positions Sales 1/1/2008 to 12/31/2008: CHF 455 million (+119%) New Value share as of 03/31/2009: CHF 0.12 million; corresponds to 0.03% of equity. Website: www.meyerburger.ch Ticker symbol: SIX: MBTN

Brief description

p Meyer Burger Technology AG is a leading, globallyactive technology group for innovative systems and processes for the processing of crystals and other highgrade materials. Its machines, competencies and technologies are used in the solar industry, the semiconductor industry and the optics industry. The group's core competencies include a wide range of production processes, equipment and systems used within the value chain for the production of high-grade wafers, as well as a worldwide service network.

2008/09 Highlights

  • p Meyer Burger achieved outstanding sales and revenue growth. Net sales increased to CHF 455 million (+119%) and EBIT rose to CHF 77 million (+208%).
  • p The group was successfully expanded through majority interests in Hannecke Systems GmbH (precision measurement technology for wafers and cell lines) and AMB Apparate + Maschinenbau GmbH (automation solutions for wafer handling and transport) as well as the founding of two Meyer Burger service companies in Germany and Norway.
  • p Meyer Burger ordered a temporary reduction in working hours at its production site in Thun, Switzerland, until the second half of the year for the purpose of adjusting production capacity to current demand. Meyer Burger expects improved production capacity utilization for the second half of 2009.
  • p New Value sold 1,000 shares at an average price of CHF 120.54 and purchased 500 shares at an average price of CHF 121.75.

Value drivers

p High industry growth expected, particularly due to "grid parity" for solar power expected in the next few years (competitiveness of electricity costs versus traditional generation methods)

p Strong market and technology positioning, particularly in the Asian growth market; smaller acquisitions strengthened product offerings

Valuation

p Valuation at CHF 116.60 per share (previous year: CHF 305.00) corresponds to the market price on March 31, 2009. Share prices fell 61.8% over the entire reporting period amid overall market turmoil and in contrast with operational achievements. As this report went to print on June 10, 2009, the share price had risen to CHF 166.60.

Medical Technology

Idiag AG

Business segments: Diagnostics and rehabilitation for back care and respiration Locations: Fehraltorf ZH, Switzerland, and Bad Säckingen, Germany Workforce as of 03/31/2009: 14 full-time positions Sales development 01/01/2008 – 12/31/2008: -12% New Value share as of 03/31/2009: CHF 7.62 million; corresponds to 45.5% of equity New Value Board Representative: Paul Santner (President) Website: www.idiag.ch

Brief description

p Idiag AG develops and distributes innovative products for medicine, therapy and sports applications in the back care and respiration growth segments. Medi-Mouse® is a practical measuring system for computerassisted imaging and radiation-free examination of the shape and movement of the spinal column. SpiroTiger® Medical is a device used for targeted rehabilitation and endurance training of respiratory muscles (for example, for reducing shortness of breath in COPD patients). SpiroTiger® Sport is used by recreational and professional athletes to improve the stamina and strength of their respiratory muscles and upper body.

2008/09 Highlights

  • p Retail-only product distribution and concentration on own products had a temporarily negative effect on total sales. Sales of own products increased over the previous year in the two-digit percentage range. New product generations are expected to stimulate growth.
  • p In October 2008, the company launched new versions of its SpiroTiger respiratory trainer for the sports industry: The SpiroTiger GO is designed as a novice device, while SpiroTiger SMART is aimed at professional and aspiring athletes and includes a variety of software applications such as a training planner. In cooperation with Ochsner Sport, as of spring 2009 Idiag is offering the new SpiroTiger via the Ochsner Sport Running Team website.
  • p With the goal of developing new medical application areas for SpiroTiger, in 2008 Idiag initiated studies on cystic fibrosis and obstructive sleep apnea.
  • p The back diagnostics business segment (MediMouse) performed favorably, with 26% growth.
  • p Idiag added Fitmate® (performance diagnostics and body weight management) to its product portfolio. This portable device with built-in color display and mini-

printer is primarily aimed at doctors' offices, hospitals, nutrition counselors and fitness studios.

Value drivers

  • p Back complaints, respiration and preventive health care are growth segments within the medical industry.
  • p Product and technology portfolio harbors potential for substantial growth rates
  • p Strengthening of internal structures and new medical studies form the basis for planned market expansion

Valuation

p Valuation at CHF 1.20 per share corresponds to the price during the most recent capital increase in September 2007 (previous year: CHF 1.20).

Medical Technology Swiss Medical Solution AG

Business segment: In-vitro diagnostics Location: Büron (LU), Switzerland Workforce as of 03/31/2009: 6.5 full-time positions Sales development 01/01/2008 – 12/31/2008: +184% (market launch). New Value share as of 03/31/2009: CHF 1.56 million; corresponds to 38.9% of equity; plus a CHF 4.32 million convertible loan New Value Board Representative: Peter Letter Website: www.swissmedicalsolution.ch

Brief description

p Swiss Medical Solution AG develops, produces and sells self-tests for urinary tract infections (UTIs) to distributors. The specific needs of women, small children, the elderly and diabetics are comprehensively addressed with custom-made tests. The first application in use is the U-Lab®-brand self-test for early detection in women. It is an important tool in the simple and reliable detection of UTIs and the monitoring of treatment success without the need for repeat doctor visits. Consumers are reached through a cooperation strategy with distributors who offer U-Lab® in combination with other products (antibiotics for treating UTIs and UTI prevention products).

2008/09 Highlights

  • p Swiss Medical Solution and Zambon Schweiz AG established a comprehensive distribution partnership agreement for the exclusive marketing of U-Lab® in Switzerland. Zambon already offers the antibiotic Monuril against urinary tract infections. Thanks to this partnership, patients who suffer from recurring UTI can obtain a comprehensive treatment system from a single source.
  • p Swiss Medical Solution also established a cooperation agreement in Germany with a strong distribution partner: Dolorgiet GmbH is a historic provider of pharmaceutical and health care products as well as high-quality pregnancy tests. U-Lab® allowed Dolorgiet to strengthen its portfolio in the area of diagnostics for women.
  • p Two additional product platform-based self-tests are now in advanced development. The company is currently testing a built-in diaper test for detecting UTIs in small children.
  • p The Board of Directors and the management team welcomed several new additions. Marc Neuschwander, former CEO of Bayer Switzerland, was named President of the Board of Directors. Dr. Peter Röttger, member of the

German Diabetes Foundation and former managing director of diagnostics at Abbot in Germany, also joined the Board. Dr. Thomas Kaltenbach replaces Andreas Küng as CEO, who could not assume the post for health reasons. Thomas Kaltenbach was formerly General Manager of UCB-Pharma AG. He has extensive experience in the pharmaceutical industry (Rx and OTC).

p New Value took part in a financing round in September 2008, increasing its share in the company along with other co-investors. With a capital investment of CHF 2 million (CHF 1.8 through debt conversion), New Value increased its share by 38.9%. New Value also participated in a loan with a favorable conversion option through an additional investment of CHF 0.9 million.

Value drivers

  • p Patent-protected technology and product platform for in-vitro diagnostics in the home-testing market
  • p Clearly-defined USP: User-friendly, lab-quality self-tests
  • p U-Lab®, the company's first product, shows encouraging success in Switzerland and Germany as a promising basis for further market expansion
  • p Numerous potential applications for the technology in new products, two of which are already in advanced development

Valuation

p Valuation at CHF 5.00 per share determined using discounted cash flow method (prior year: CHF 21.32, average purchase price CHF 10.50). Value adjustment of stock position by CHF -1.7 million took place due to slower business development in 2008. The market value of the convertible loan includes a valuation of the borrowed capital portion at present value per the effective interest method and the option portion. Based on favorable conversion terms, the convertible loan was valued at CHF 4.3 million, including an upvaluation of CHF 3.4 million. Overall, the Swiss Medical Solution position was upvalued by CHF 1.7 million.

Mycosym International AG Health

Business segment: Plant technology Locations: Basel, Switzerland and Seville, Spain Workforce as of 03/31/2009: 5.5 fulltime positions Sales development 01/01/2008 – 12/31/2008: -27% New Value share as of 03/31/2009: CHF 4.23 million; corresponds to 49.1% of equity, plus a CHF 0.46 million loan New Value Board Representative: Peter Letter (President) Website: www.mycosym.com

Brief description

p Mycosym International AG is a plant technology company that develops, produces and markets unique biological soil additives using mycorrhiza (natural symbiosis between plant roots and soil fungus). These soil additives improve the growth of plants (increased vigor and biomass), leading to increased yield and fewer losses in intensive farming and allowing growth in extreme locations (drought, salinity). An additional benefit is reduced water consumption in agriculture and gardening. In some applications, resistance against pests and diseases is increased.

2008/09 Highlights

  • p Juan P. H. Candau joined the firm as CEO for Spain. He has extensive experience and proven success in the areas of plant and seed cultivation, business development and corporate structuring. The company's focus on the Spanish market has proven successful, as it guarantees customer proximity.
  • p The difficult economic environment in Spain led to a decline in sales in the olive segment. In the current year, the distributor base will be expanded and target markets gradually complemented with additional plant cultivation products. After market launch in Spain, expansion into other Mediterranean countries is planned. Distribution partnerships have already been established in Greece and Turkey.
  • p Mycosym accelerated the development of a second product line for the lawn market segment. The positioning of these new products will be based on potential benefits in water management, an important issue in the Spanish target market. Independent studies and prior applications on golf courses in Spain have been successful, with demonstrated water savings of 30-50%.
  • p In March 2009, the company raised funds for further market development, sales team expansion and product

development intensification. New Value contributed an additional CHF 0.22 million in loaned funds.

Value drivers

  • p Attractive gross margins thanks to cost-effective production processes; deep cost structure
  • p Market entry barriers for competitors due to lengthy development period (natural growth cycle of plants)
  • p Potential for continuous product innovation
  • p Sustainable agricultural products are a growth market; high customer benefits in water management offer additional potential

Valuation

p Valuation adjusted to CHF 21.75 per share (previous year: 32.50) due to substantial sales goal shortfall. Devaluation was conducted based on a newly-developed business plan using the discounted cash flow method.

Health

Bogar AG

Business segments: Animal health and nutrition Location: Wallisellen ZH, Switzerland Workforce as of 03/31/2009: 8 fulltime positions Sales development 01/01/2008 –12/31/2008: +87% New Value share as of 03/31/2009: CHF 7.15 million; corresponds to an equity share of 29.8% New Value Board Representative: Rolf Wägli (President) Website: www.bogar.com

Brief description

p Bogar AG specializes in natural and future-oriented animal health and nutrition and develops, produces and markets quality plant-based food supplements and care products. Bogar is a pioneer in the area of veterinary phytotherapy and the developer of an ever-growing product catalog for effective supportive nutrition and the natural prevention and treatment of various somatic disorders and diseases in animals. The current product range consists of effective nutritional supplements as well as high-quality care preparations for dogs, cats and sporting and recreational horses.

2008/09 Highlights

  • p Bogar once again achieved record results. Its flea treatment for dogs and flea spray for cats, the latter introduced in 2008, were the top sellers. Both products are based on newly developed combinations of natural substances from specially selected plants. Sales grew by 87% overall.
  • p In Germany, Bogar acquired a new distribution partner: Trixie (retail supplier to approximately 5,000 customers) as well as two major internet portals: www.zooplus.de and www.shop-apotheke.de.
  • p External sales and warehouse management were outsourced to external specialists to increase efficiency and as a reaction to the difficult economic environment. Today, Bogar is consistently focused on its core activities of product development and marketing.
  • p At the end of 2008, Bogar increased its capital by CHF 7 million through the settlement of existing loans and through cash. New Value invested CHF 2.2 million (CHF 1.93 through debt conversion), increasing its share in the company's capital stock to 29.8%. The funds will be used to consistently pursue the company's growth strategy, expand existing distribution channels and drive the development of new products.

Value drivers

  • p Expanded product portfolio, successful market launches
  • p Distribution channels in Switzerland and Germany tapped, continued market expansion in Germany
  • p Planned expansion to other international markets

Valuation

p Valuation adjusted to CHF 30.57 per share (previous year: CHF 360.00) based on average capitalizationweighted share price of previous shares and newly acquired shares during the internal financing round that took place at the end of 2008. This price is based on a discounted cash flow valuation.

Fotodesk Group AG (Colorplaza SA acquired) Information Technology

Business segments: Online photo service Location: Zug ZG, Vevey VD, Switzerland and Trivandrum, India Workforce as of 03/31/2009: 49 full-time positions Sales development 01/01/2008 – 12/31/2008: Realignment after merger New Value share as of 03/31/2009: CHF 4.5 million; corresponds to 45% of equity; plus a CHF 0.86 million convertible loan New Value Board Representative: Peter Letter (President) Website: www.fotodesk.com

Brief description

p Fotodesk Group AG is an integrated company in the area of digital imaging services. Alongside traditional photo printing, it offers innovative lifestyle products such as self-stick posters, laptop skins and wall tattoos. Fotodesk has recently expanded its product offerings through an online fine art print boutique. Through its merger with flauntR, www.flauntr.com, an online portal for image editing, customers also have access to highquality image editing applications. The company is represented on the market through two online services: www.colormailer.com and www.fastlab.com.

2008/09 Highlights

  • p New Value portfolio company Colorplaza SA was merged into FotoDesk Group AG. FotoDesk Group AG simultaneously acquired FlauntR, an online provider of image editing, archiving and sharing. New Value holds a 45% share in this image editing, printing, sharing and photo archiving conglomerate.
  • p The company increased its activities in the area of new customer acquisition (e.g., through its "1,000 free print offer"), achieving early success in France.
  • p The web portals were updated with a new software architecture and design and now offer the user access to flauntR's innovative image editing technology.

Value drivers

  • p Customer base in several European countries
  • p Growth potential from the use of innovative web technologies and integration with online photo editing
  • p Continuous product innovations in the area of print, fine art and decor
  • p Strong development team with a high degree of competence in internet applications, image editing and online marketing

Valuation

p Valuation at CHF 1.00 per share corresponds to the capital transaction price at the acquisition of Colorplaza SA by FotoDesk Group AG in June 2008. The market value of the convertible loan includes a valuation of the borrowed capital portion at present value per the effective interest method and the option portion.

Information Technology Qualilife SA

Business segments: Software for the health care industry Location: Lugano TI, Switzerland Workforce as of 03/31/2009: 4.5 full-time positions Sales development 01/01/2008 – 12/31/2008: Market launch phase New Value share as of 03/31/2009: CHF 0.72 million; corresponds to 18.2% of equity New Value Board Representative: Thomas Keller Website: www.qualilife.com

Brief description

p Qualilife is a software company that specializes in developing access technologies for the disabled, the elderly and hospital patients. The company has developed a software platform that allows persons with physical disabilities or a lack of PC skills to utilize all current ICT functionalities. The software is intuitive and supports the use of special hardware for the disabled. The platform was redeveloped for hospital patients and rehab clinics and now represents an all-encompassing communications and entertainment solution for the health care industry.

2008/09 Highlights

  • p To finance the continued growth of Qualilife, New Value is investing CHF 2.0 million in three increments. After the first financing round of 0.72 million in June 2008, New Value increased its investment with an additional CHF 0.64 million. It now holds a 26.1% share in Qualilife. The new funds were primarily directed toward the development of international distribution structures and the continued development of products for the health-care sector.
  • p In May 2009, Walter M. Huber came on board as the company's new CEO. He brings with him many years of experience in the health care IT solutions sector and will advance the expansion of national and international sales structures at Qualilife.
  • p A private clinic in Ticino is being equipped with 100 patient terminals, representing a major achievement for Qualilife's Qualimedical Unified Solution software. The project is nearing completion.

Value drivers

p Health care market entry with technologically impressive product; potential for duplication in the telemedical and telecare sectors.

  • p High customer benefits of the system in the health care, disabled and senior segments
  • p Existing development partnerships with leading software companies; increased attention on access technologies through membership in international organizations

Valuation

p Valuation at CHF 3.00 per share corresponds to the price during the June 2008 capital increase.

Silentsoft SA Information Technology

Business segments: Information technology/M2M telemetry Location: Morges VD, Switzerland Workforce as of 03/31/2009: 21 full-time positions Sales development 01/01/2008 – 12/31/2008: -32% New Value share as of 03/31/2009: CHF 3.58 million; corresponds to 25.7% of equity New Value Board Representative: Dr. Marius Fuchs (New Value cooperation partner) Website: www.silentsoft.com

Brief description

p Silentsoft SA is a leading company in the machine to machine (M2M) communications technology sector. Silentsoft developed a proprietary technology with processes and software that make it possible to set up and operate large M2M remote monitoring networks for measuring, automatically transmitting and analyzing data from geographically distributed containers for bulk goods such as liquids or powders. Founded as a pioneer in M2M communications in 2000, Silentsoft has developed into Europe's leading provider of wireless M2M network services for building management. These widely-used services allow property managers to monitor and manage gas tank levels, for instance, from a central location.

2008/09 Highlights

  • p Silentsoft successfully introduced the new SNODE hardware generation, with more than 300 installations. SNODE has lower cost structures, which should allow Silentsoft to continue to expand its market share and cost leadership. Due to longer-than-expected development time for SNODE, Silentsoft fell short of its sales goals for 2008. In 2009, the company expects to once again return to its path of growth.
  • p Silentsoft further expanded its product range. In addition to remote monitoring devices for waste and recycling management and silos planned for late 2008, the company developed remote-controlled water and gas measuring systems with built-in alarm functions. After successful customer testing, market launch will take place 2009.
  • p In order to finance further market expansion and expand its product portfolio, in November 2008 Silentsoft held a financing round with existing shareholders, raising CHF 2 million. New Value increased its share by CHF 1.2 million (CHF 0.2 million through the purchase of

a block of shares from an existing shareholder) and now holds 25.7% of Silentsoft's capital stock.

Value drivers

  • p Leading European market position in the M2M network for building management segment offers good opportunities for quick expansion of customer base.
  • p High level of customer loyalty and repeat sales
  • p Expansion of core-business-related activities; potential areas include silos for agricultural products or recycling collection systems.
  • p High market growth expected in the next few years.

Valuation

p Valuation at CHF 176.13 per share corresponds to the acquisition price during the capital increases carried out in November 2008 (previous year: CHF 227.00).

New Materials / Raw Materials

Natoil AG

Business segments: Lubricants based on renewable raw materials Location: Immensee SZ, Switzerland Workforce as of 03/31/2009: 6 full-time positions Sales development 01/01/2008 – 12/31/2008: +63% New Value share as of 03/31/2009: CHF 1.2 million; corresponds to an equity share of 23.8%; plus a CHF 0.24 million loan New Value Board Representative: Peter Letter Website: www.natoil.ch

Brief description

p Natoil AG develops and distributes industrial lubricants with first-rate technical qualities based as much as possible on renewable raw materials. Thanks to reduced friction losses, their use allows for substantial energy savings of 5-20% and less wear and tear. The current CO2 debate and the long-term trend of rising prices for mineral oil products underscores the market potential of Natoil lubricants. Natoil uses seeds from a special type of domestically-cultivated sunflower as its primary raw ingredient. This variation of the sunflower does not compete with food production.

2008/09 Highlights

  • p Natoil received additional major industry approvals from machine manufacturers, including Junker (grinding machine manufacturer) and Moog (hydraulic pumps). Arburg, one of the leading manufacturers of injection molding machines worldwide, has been delivering all gears for a specific machine type exclusively with Natoil NATsync GS100 lubricant (First Fill) worldwide since mid-2008.
  • p Natoil increased its sales by 63%. However, in light of the difficult economic situation in many customer segments, budget goals were not fully met. The last financing round increment was therefore granted in the form of a loan instead of capital.
  • p Additional new customer acquisitions in the plastic injection moulding and pump sectors. Natoil has already established highly successful customer relationships in this market. In addition, the foundations were laid for expanding into other market segments, such as presses. These activities are currently being negatively impacted by the poor economy.
  • p In the spring of 2009, Natoil relocated to the Hohle Gasse Technology Center in Immensee in the Swiss canton of Schwyz. The new site boasts separate laboratory spaces as well as enough room for future company expansion.

p New Value took part in a growth financing initiative during the reporting period, contributing CHF 0.3 million in capital and guaranteeing the company an additional loan of CHF 0.24 million. After the balance sheet date in April 2009, New Value increased the loan to CHF 0.3 million. Financing took place proportionately along with other investors.

Value drivers

  • p First-rate product qualities with high customer benefits (energy savings) in niche applications
  • p Broad existing product portfolio for various industrial applications
  • p Manufactured using renewable raw materials from European agricultural regions; CO2 debate is encouraging product acceptance
  • p Good scalability in manufacturing and market access

Valuation

p Valuation at CHF 25.38 per share corresponds to the acquisition price during the capital increases carried out in June 2007 and February 2008 (previous year: CHF 31.73).

FINANCIALS ANNUAL STATEMENT ACCORDING TO IFRS

BALANCE SHEET

3/31/09 3/31/08
Item Note CHF CHF

ASSETS

Non-Current Assets
Investments
20.2.
53,530,700 63,676,470
Long-term Convertibles and Loans
19.2./3.
5,638,153 3,078,749
Total Non-Current Assets 59,168,853 66,755,219
Current Assets
Short-term Loans
19.1.
240,000 500,000
Other accounts receivable
18
65,591 102,875
Accruals 16,262 68,106
Cash and cash equivalents
17
7,630,280 14,882,671
Total Current Assets 7,952,133 15,553,652
Total Assets 67,120,986 82,308,871

LIABILITIES AND SHAREHOLDER'S EQUITY

Shareholders Equity
Share capital paid-in
21
32,872,330 32,872,330
Treasury Shares
21.4.
–5,231,499 –6,406,150
Share premium 22,115,981 25,139,669
Accumulated profit/loss carried forward 15,587,969 29,576,794
Total Shareholders' Equity 65,344,781 81,182,643
Liabilities
Short-term Financial Liabilities 1,324,800 720,000
Deferrals 451,405 406,228
Total Liabilities 1,776,205 1,126,228
Total Liabilities and Shareholders' Equity 67,120,986 82,308,871

INCOME STATEMENT

4/1/2008 –
3/31/09
4/1/07–
3/31/08
Item Note CHF CHF
Income from investments and loans
Income from sale of investments 20.2. 1,043,816 9,838,388
Unrealised income from investments 19/20.2. 5,371,986 17,630,680
Interest income 24 239,433 204,594
Total income from investments and loans 6,655,235 27,673,662
Expenses from investments and loans
Unrealised losses on investments and loans 19/20.2. –17,330,686 –1,857,114
Realised losses on investments and loans 19/20.2. –138,645 –690,743
Investment expenses –187,131 –180,000
Total expenses from investments and loans –17,656,462 –2,727,857
Operating expenses
Investment management fee 23 –1,746,663 –1,249,576
External personnel expenses 23 –96,840 –96,840
Expenses Board of Directors 27 –152,850 –245,486
Expenses auditors –65,851 –66,552
Expenses communication / IR –480,079 –539,817
Consulting costs (Legal and Tax) –27,060 –54,602
Other administrative expenses –178,824 –181,697
Capital tax –105,000 –251,429
Total operating expenses –2,853,167 –2,685,999
Financial income and expenses
Financial income 24 92,276 227,208
Financial expenses 24 –226,707 –177,274
Total financial income and expenses –134,431 49,934
Earnings before taxes –13,988,825 22,309,740
Income tax 25 0 0
Net income/loss –13,988,825 22,309,740
Average number of shares outstanding 2,846,545 2,868,152
Result per share undiluted 26 -4.91 7.78
Result per share diluted 26 -4.91 7.78

New Value AG Bodmerstrasse 9 Postfach CH-8027 Zürich Telefon +41 43 344 38 38 Fax +41 43 344 38 39 [email protected] www.newvalue.ch

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