I N T E R I M R E P O RTJ A N U A RY 1 T O S E P T E M B E R 3 0 , 2 0 0 4

G R O U P K E Y D ATA

1

Q1 – 3/2004in d million

1) Q1 – 3/2003in d million

1) Change in %

Sales 1 831.2 1 788.8 2.4

Profit

EBITA 2) 261.8 163.7 59.9

EBITA margin in % 14.3 9.2

DVFA/SG income 133.3 61.4 117.1

Net income 126.1 106.2 18.7

Cash flow from operating activities 202.5 258.5 – 21.7

Capital expenditure 89.2 115.2 – 22.6

Balance sheet total 3) 2 312.8 2 182.8 6.0

Share in c

DVFA/SG earnings per share 4) 4.36 1.81 140.9

Closing price 5) 88.20 54.50 61.8

Number of employees

Average 11 417 11 740 – 2.8

1) Q1 – 3: January 1 to September 302) Result before taxes, interest and goodwill amortisation, adjusted for extraordinary items3) As of September 30, 2004 and December 31, 20034) Calculation basis: 30.6 million shares in Q1 – 3/2004 (excluding own shares), 34.0 million shares in Q1 – 3/20035) As of September 30, 2004 and September 30, 2003

EBITA/EBITA margin (Q1 – 3)

in c million

300

250

200

150

100

5020042003

9.2%

14.3%

DVFA/SG income (Q1 – 3)

in c million

180

150

120

90

60

3020042003

1.81 c

4.36 c

DVFA/SG income

DVFA/SG earnings per share

1

EBITA

EBITA margin

2

Retail press markets continue to declineOngoing weak demand cut across all industries. In the retail

sector, the expected stabilization of demand did not materialize.

Net paid circulation for newspapers and magazines declined

by 3%. Across the industry, press sales were down 1%.

With 380 daily and Sunday newspapers registered with the

circulation organization IVW, total sales declined year-on-year

in the first three quarters to 26.2 million copies. This was a

decline of 2.4% against the first three quarters of 2003. News-

stand sales lost 4.7%, subscriptions declined by 1.9%.

The number of general-interest titles registered with IVW

increased by 13 to 822. In the first nine months, total IVW

sales at 124.7 million copies per issue receded by 0.3% year-

on-year. Newsstand sales dropped by 2.5% while subscriptions

developed stable (+0.3%). This includes circulation in member-

ship magazines.

While in the newspaper market new accents were set primarily

for young readers with launches of inexpensive titles in tabloid

format, predatory competition continued via the low copy

prices for weekly women’s press and TV guides. In the

Electronics/Entertainment segment, imitation products with

lower prices began to push onto the market for the first time.

In the first nine months of the 2004 financial year, Axel Springer improved earnings before interest, tax and amortisation (EBITA) from d 163.7 million in the pre-vious year to d 261.8 million. The net income for the period increased from d 106.2 million to d 126.1 million. The conclusion of a settlement agreement in the con-text of the insolvency scheme process at Taurus TV GmbH (Kirch settlement) contributed d 92.6 million to EBITA and d 62.3 million to net income. Net income of the previous year was impacted by non-recurring effects from company disposals. In the first nine months, sales increased by 2.4% year-on-year. Both circulation and advertising revenues increased. On the basis of ongoing success in the introduction of new newspapers and magazines combined with further cost cutting effects and the result of the first nine months, the Management Board continues to expect that sales and EBITA for the whole of the 2004 financial year will be higher than 2003, even before adjustment for the Kirch settlement.

ECONOMIC ENVIRONMENT

For the first nine months of the year, the leading economic

institutes estimate real growth of 1.6% against the comparable

period of the previous year. In the same period, private con-

sumption declined by 0.3%. Consumer demand is still nega-

tively impacted by lower employment figures. For the first

nine months, the inflation rate was 1.6%.

Continuing stability in the advertising marketAccording to Nielsen Media Research, gross advertising sales

of classical media in the first nine months of 2004 (excluding

classified ads) posted 5.8% growth year-on-year. Gross advert-

ising investment of brand and service companies and large

retailers (including media advertisement) totaled a 12.7 billion.

However, decisive in business terms is the decisive net devel-

opment. Here the trend was considerably less favorable. This

was due to ongoing pressure on conditions. The classified ads

market in particular, a central source of income for subscriber

newspapers, experienced further decline in the family, travel

and jobs vacancies market.

I N T E R I M R E P O RTAxel Springer Group

BUSINESS DEVELOPMENT

In the first nine months, Axel Springer increased EBITA from

a 163.7 million to a 261.8 million. Net income increased from

a 106.2 million to a 126.1 million. The conclusion of a

settlement agreement in the context of the insolvency scheme

process at Taurus TV GmbH contributed a 92.6 million to

EBITA and a 62.3 million to net income. The prior-year figure

was influenced by extraordinary earnings from company dis-

posals.

In the first nine months, the company generated a 2.4% year-

on-year sales increase, with both circulation and advertising

revenues moving up. Ongoing cost management in the core

business offset the start-up losses of new titles.

Axel Springer continues to launch new titles. In Germany

the company launched the fortnightly TV guide TV DIGITAL

in March. In September the finance magazine FONDS&CO,

the literary magazine DER FREUND and the classified ads

newspaper AUTOBILD.DE-AUTOMARKT was started.

FAKT, the Polish daily started in October 2003, has established

itself as the largest daily newspaper in the country with more

than 3 million readers. In October 2003, Axel Springer launched

REGGEL, the first modern quality newspaper for the Budapest

area. In the third quarter, Axel Springer Budapest launched

two new magazines, AUTO BILD and GLAMOUR. The Rus-

sian subsidiary Axel Springer Russia introduced also two

new titles with FORBES RUSSIA and RUSSKIJ NEWS-

WEEK. The RPG (Romanian Publishing Group), in which

Axel Springer has a 40% stake, launched the women‘s maga-

zine SANA in Rumania.

Axel Springer expanded the international licensing business.

With five new licensed editions this year (Estonia, Finland,

Slovakia, Latvia, Thailand), AUTO BILD is the fastest growing

international licensed title. In September, COMPUTER BILD

started with a new offshoot in Lithuania.

The women’s magazine ALLEGRA, the TV guide TV MÜSOR

in Hungary and the car magazine AUTO SUKCES in Poland

were discontinued.

The construction of the new office and business premises in

Berlin was concluded as scheduled. The process of bundling

central group management and service functions at the main

office in Berlin with the objective of achieving further improve-

ments in efficiency was successfully completed in the first

half of the year.

NewspapersIn the reporting period, BILD considerably expanded advertising

revenues with brand companies and the retail business as well

as with advertising cooperations. BILD reached an average

circulation of 3.8 million copies.

With a revised contents and optical concept, BILD am SONNTAG

has offered more topicality, service and sport since August.

The main part of the newspaper has been extended from 48

to 64 pages, 8 of which are devoted to more sports reporting.

The positive trend in the advertisement and insert business at

BILD am SONNTAG continued.

Newspapers in Germany

Net paid circulation, IVW, average Q1 to Q3 2004

BILD 3 843 451

BILD am SONNTAG 2 102 010

DIE WELT 203 914

WELT am SONNTAG 403 114

HAMBURGER ABENDBLATT 278 406

BERLINER MORGENPOST 151 721

B.Z. 230 577

B.Z. am SONNTAG 129 867

EURO am SONNTAG 109 510

3

WELT and WELT am SONNTAG kept advertising revenues

stable in the first nine months. Since August, WELT am

SONNTAG has had a new modern layout, with a revised

structure and new contents. After successful trials in Berlin

and Frankfurt am Main, the launch of WELT KOMPAKT was

continued across Germany with extension of the distribution

to Munich, Dusseldorf and parts of the Ruhr area. WELT

KOMPAKT is the first regional quality newspaper in Germany

in the compact tabloid format and the third national news-

paper founded in the last 50 years.

The restraint of the advertising market in the first nine months

of the financial year was also felt in Berlin at the BERLINER

MORGENPOST and B.Z./B.Z. am SONNTAG. With modestly

positive signals from the retail sector and the property markets,

the two newspapers asserted their market position.

With net paid circulation of 278 000, the HAMBURGER

ABENDBLATT developed more positively than the overall

market of regional newspapers. In both the retail and advertising

market, the company defended its leading position in the

Hamburg region.

Retroactive to January 1, 2004, Axel Springer has aquired

a 14.5% share in Westfalen-Blatt Zeitungsverlage GmbH, one

of the largest regional newspapers in North Rhine-Westphalia.

MagazinesAxel Springer successfully continued its expansion process in

Germany and abroad. The fortnightly TV guide TV DIGITAL,

launched in March, established itself as the quality magazine

for digital television. Circulation improved steadily with net

paid circulation averaging 1.2 million copies, while the estab-

lished TV magazines had lower net paid circulation in the first

nine months than the comparable period of the previous year.

Magazines in Germany

Net paid circulation, IVW, average Q1 to Q3 2004

HÖRZU 1 729 111

TV DIGITAL1) 1 040 811

FUNK UHR 927 994

BILDWOCHE 321 248

TV NEU 296 346

BILD der FRAU 1 273 904

FRAU von HEUTE 483 021

JOLIE 331 785

JOURNAL für die FRAU 305 149

COMPUTER BILD 841 362

COMPUTER BILD SPIELE 622 816

AUDIO VIDEO FOTO BILD 531 474

AUTO BILD 680 700

AUTOMOBIL TESTS 98 738

AUTO BILD MOTORSPORT 67 981

AUTO BILD ALLES ALLRAD 68 442

AUTO BILD TEST & TUNING 57 186

SPORT BILD 490 977

MAXIM 245 374

POPCORN 323 936

YAM! 251 660

MÄDCHEN 214 248

STARFLASH 117 869

ROLLING STONE 60 360

MUSIKEXPRESS 59 817

METAL HAMMER 48 955

FINANZEN 112 071

1) Included since the 2nd quarter of 2004

4

5

InternationalThe Polish daily FAKT was launched by Axel Springer in

October 2003. In just short time, it has firmly established

itself as the country‘s largest daily newspaper with more than

500,000 copies sold and reaching around 3 million readers.

The new market segment of fortnightly TV guides has been

established in France since the beginning of the year. As a

result, competition has considerably intensified on the market

for TV guides, in which Axel Springer is represented by TÉLÉ

MAGAZINE.

With FORBES RUSSIA and RUSSKIJ NEWSWEEK the

Russian subsidiary Axel Springer Russia launched two new

magazines.

In October 2004, Axel Springer launched REGGEL, the first

modern quality newspaper for the Budapest area. REGGEL

is the ninth daily published by Axel Springer in Hungary.

The printing house in Keckemet was extended, being equipped

for the additional requirements of the new daily REGGEL.

In September, Axel Springer Budapest launched the twenty-

third AUTO BILD and the monthly women’s magazine

GLAMOUR in a licensed edition.

Axel Springer extended its international licensing business

with five further licensed editions of AUTO BILD (Estonia,

Finland, Slovakia, Latvia, Thailand) and a new edition of

COMPUTER BILD in Lithuania. In Lithuania the licensee

is Veidas Periodical Publishing. COMPUTER BILD already

appears in Poland, Spain and the Czech Republic.

The titles AUTO SUKCES in Poland and TV MÜSOR in

Hungary were discontinued.

For accessing new markets in Asia, Axel Springer founded a

representative office China based in Shanghai.

In the fiercely contested market of women’s magazines, BILD

der FRAU defended its market leadership in a commanding

fashion. According to the Media-Analyse 2004/II, BILD der

FRAU reached a total of 5.5 million readers. The new monthly

women’s magazine JOLIE further improved its circulation,

creating a new high of over 365 000 net paid copies in the

third quarter. Due to the ongoing difficult market situation,

the monthly Women’s magazine ALLEGRA was discontinued.

In the first nine months of the year, COMPUTER BILD

increased its circulation year-on-year by 1.7% to over 841 000

copies. COMPUTER BILD thus confirmed its undisputed

market leadership in the European computer magazine

market.

AUDIO VIDEO FOTO BILD, launched in December 2003,

has developed in a very positive way. Over the year it averaged

circulation of more than 531 000 net paid copies, becoming

the consumer electronic magazine market leader by a large

margin.

AUTO BILD remains by far the largest car magazine in

Germany. For its excellent brand management it was awarded

the title „Superbrand”. An independent jury of experts made

up of leading personalities selected the 46 best and strongest

brands in Germany from a range of 700 brand names submitted.

Since September, the fortnightly classified ads magazine

AUTOBILD.DE-AUTOMARKT with a printed circulation

exceeding 200 000 is being supplemented with the internet

portal AUTOBILD.DE. The magazine is publishing offers for

more than 5 000 used cars on over 150 pages.

The Munich-based Verlag Finanzen is publishing the new

quarterly financial magazine FONDS & CO.

Since September 2004, Axel Springer has launched the quarterly

literary magazine DER FREUND. The magazine deliberately

does not use photos and advertising.

6

FINANCIAL SITUATION

SalesIn the first nine months of the year, Axel Springer generated

a sales increase from a 1 788.8 million to a 1 831.2 million

(+ 2.4%).

Advertising revenues rose by a 22.9 million (+ 3.3%) to reach

a 708.9 million. Circulation revenues moved up by a 24.9 mil-

lion (+ 2.9%) to a 892.9 million. At a 229.4 Miscellaneous

sales million were down slightly year-on-year (– 2.3%). Sales

generated outside of Germany increased from a 248.0 mil-

lion by a 19.1 million (+ 7.7%) to a 267.1 million. Thus, the

share of sales generated abroad rose from 13.9% to 14.6%.

Newspaper sales rose by a 45.0 million (+ 4.5%) to a 1 048.3 mil-

lion in the first nine months of the year. Advertising revenues

rose by a 26.9 million (+ 5.4%) to a 520.6 million. In particular,

BILD and BILD am SONNTAG contributed to this positive

development. At a 527.7 million circulation revenues for news-

papers were up a 18.1 million (+ 3.6%) year-on-year. This is

primarily due to the effect of price increases introduced at BILD

and HAMBURGER ABENDBLATT to the middle of 2003.

In the first nine months magazine sales, at a 553.5 million,

were up slightly year-on-year (+ 0.5%). At a 188.3 million,

advertising revenues were down a 4.0 million (– 2.1%) on

the previous year. While new titles and the car and computer

magazines developed well, traditional TV guides and women‘s

magazines found themselves under earnings pressure. At

a 365.2 million, circulation revenues were up a 6.8 million

(+ 1.9%) on the previous year. In addition to the positive

development at COMPUTER BILD, this growth was primarily

driven by the launch of the new AUDIO VIDEO FOTO BILD,

TV DIGITAL and FRAU von HEUTE titles.

Electronic MediaWith a 49.9% stake in the online jobs portal StepStone

Deutschland AG, Axel Springer is commencing a strategic

alliance for marketing national and regional job advertise-

ment. After the successful development of IMMONET and

AUTOBILD.DE, the investment in StepStone is a decisive

strategic supplement of the online classified ads business in

the third key segment of jobs. The stake in StepStone Deutsch-

land AG is still subject to approval for the Federal Cartel Office.

In the first nine months of the year, IMMONET with average

real estate offers of over 210 000 has firmly established itself

as one of the leading real estate portals. With some 650 000

being offers, AUTOBILD. DE, the internet portal belonging

to the AUTOBILD group is one of the largest automobile

markets in the internet. For strengthening the competence in

classified ads, the B.Z. has been integrated into the AUTO-

BILD.DE internet portal.

In the first nine months of the year, the reporting highlights for

BILD.T-ONLINE were the European Championships (soccer)

and the Olympic Games. With 244 million page impressions

in September, BILD.T-ONLINE consolidated its position as a

leading cross-media general-interest portal. Sales were extended

considerably, both for online advertising as well as with cross-

media cooperations and the so-called Volk products.

Printing and LogisticsAfter successful negotiations, in September Arvato and

Gruner+Jahr and Axel Springer signed a letter of intent

for combining their five German gravure printing operations.

It was also agreed to include the printing operation which is

being built by Arvato in Liverpool, England. The project is

still subject to the approval of the supervisory bodies and

the anti-trust authorities.

In the first nine months of 2004, the contract printing volume

for offset and gravure printing rose year-on-year, despite the

continuing weakness of the economy.

Logistics and Distribution supported the establishment of new

distribution channels to better align them to consumer flows.

7

At a 44.8 million sales for Electronic Media declined year-

on-year by a 6.5 million (– 12.7%). External Printing sales

increased by a 5.2 million (+ 5.5%) auf a 100.3 million. At

a 84.3 million Other revenues were a 4.1 million (– 4.6%)

down year-on-year.

ProfitIn the first nine months, Axel Springer increased EBITA

(adjusted for extraordinary items) from a 163.7 million to

a 261.8 million. The net income for the period increased

from a 106.2 million to a 126.1 million. The conclusion

of the settlement agreement in the context of the insolvency

scheme process at Taurus TV GmbH contributed a 92.6 mil-

lion to EBITA and a 62.3 million to the net income for the

period.

The prior-year value was influenced by extraordinary earnings

from company disposals. DVFA/SG income rose from a 61.4 mil-

lion to a 133.3 million.

The improved results are due – apart from the non-recurring

income as a result of the settlement agreement – to higher

sales and ongoing cost management. This was countered by

the start-up costs of the expansion process, which negatively

impacted EBITA particularly in the magazine segment.

Total expenses (before taxes and goodwill amortisation)

rose at a level slightly below that of sales, by a 35.6 million

(+ 2.1%) to a 1 755.0 million.

Sales by sectorsQ3/2004

in d million

1) Q3/2003in d million

1) Changein %

Q1 – 3/2004in d million

2) Q1 – 3/2003in d million

2) Changein %

Circulation 307.4 300.7 2.2 892.9 868.0 2.9

Advertising 213.4 206.6 3.3 708.9 686.0 3.3

Miscellaneous 78.0 81.6 – 4.4 229.4 234.8 – 2.3

Total 598.8 588.9 1.7 1 831.2 1 788.8 2.4

Sales by segmentsQ3/2004

in d million

1) Q3/2003in d million

1) Changein %

Q1 – 3/2004in d million

2) Q1 – 3/2003in d million

2) Changein %

Newspapers 341.3 329.7 3.5 1 048.3 1 003.3 4.5

Magazines 179.5 177.6 1.1 553.5 550.7 0.5

Printing 37.5 32.4 15.7 100.3 95.1 5.5

Electronic Media 13.0 22.4 – 41.9 44.8 51.3 – 12.7

Other revenues 27.5 26.8 2.5 84.3 88.4 – 4.6

Total 598.8 588.9 1.7 1 831.2 1 788.8 2.4

1) Q3: 3rd quarter2) Q1 – 3: January 1 to September 30

8

Capital expenditureIn the first nine months, Axel Springer invested a 89.2 million

after a 115.2 million in the previous year. a 79.8 million of

capital expenditure (previous year: a 110.3 million) related

primarily to tangible and intangible assets. Capital expenditure

focused on the extension of the offset printing facility in

Ahrensburg, the construction of the new Berlin office and

business premises, and the subscribers to TV DIGITAL, the

TV guide launched in March.

Capital expenditure on financial assets amounted to a 9.4 mil-

lion (previous year: a 4.9 million). The financial assets

position on the balance sheet is also impacted by the reclas-

sification of SAT.1 Beteiligungs GmbH from current asset

to fixed asset and increasing the stake in the context of the

Kirch settlement.

Depreciation and amortisation (without goodwill amortisation)

amounted to a 65.6 million (previous year: a 59.6 million).

Net liquidityThe total of the cash flows from operating, investment and

financing activities increased liquid funds by a 80.8 million

As of September 30, 2004, funds (liquid funds and securities

in current assets) amounted to a 380.1 million. With bank

loans liabilities of a 192.6 million, Axel Springer closed the

third quarter of 2004 with net liquidity of a 187.5 million.

As of December 2003, net liquidity was a 99.4 million.

EMPLOYEES

In the first nine months of 2004, Axel Springer employed

an average staff of 11 417 people (not including trainees

and interns), 323 fewer than in the prior-year period. As

of October 1, 2004 the number of employees was 11 392

(previous year: 11 684).

SHARE

The price of Axel Springer shares at the beginning of the year

was a 70.00. During the course of the year, the share outper-

formed the MDAX and closed at a 88.20 (previous year:

a 54.50) on September 30, 2004.

In the first three quarters of the year, DVFA/SG net income

per share was a 4.36 after a 1.81 in the previous year. In the

third quarter, DVFA/SG net income per share was a 2.35

(previous year: a 0.44).

As at September 30, 2004 Axel Springer bundled share

trading on the Frankfurt stock exchange in order to con-

centrate trading at the location with the highest liquidity.

130

125

120

115

110

105

100

95

Share performance

Index January 2, 2004 = 100

Axel Springer AG

MDAX

January 04 September 04June 04

95

100

105

110

115

120

125

130

35

40

45

50

55

60

65

70

75

80

9

ANNUAL SHAREHOLDERS‘ MEETING 2004

On April 14, 2004, the Annual Shareholders’ Meeting of

Axel Springer AG voted Prof. Dr. Lepenies into the Supervisory

Board. Dr. Joachim Theye has left the Supervisory Board. The

other members of the Supervisory Board were reelected.

Furthermore, with a majority of 99.9% the Annual Shareholders’

Meeting resolved a participation program in the context of

authorization to acquire and utilize own shares (Item 7 on

the agenda).

The detailed description of the management participation

program can be found on the Company‘s Internet site at

www.axel-springer.de/InvestorRelations/Shareholders’Meeting.

A rescind action has been filed against the resolution made

by the Annual Shareholders’ Meeting 2004 on Item 7 of the

agenda. The rescind action was rejected by the Berlin District

Court on September 27, 2004. The verdict is not yet final.

In the context of management participation program and the

conditions resolved at the Annual Shareholders’ Meeting on

April 14, 2004, from August 16, 2004, Axel Springer AG

sold 62 300 shares at a price of a 54.00 per share plus 2%

p.a. from July 1, 2004, i.e. a 54.13 per share to members of

the Management Board.

MANAGEMENT BOARD CHANGE

Hubertus Meyer-Burckhardt, Head of Electronic Media,

left the company by the end of June 2004 and was appointed

as the Management Board member for Corporate Develop-

ment of ProSiebenSat.1 Media AG with effect from July 1,

2004. The Management Board position has not been refilled.

As a result this body has been reduced to four members. The

Electronic Media division is now allocated to the Management

Board member for Newspapers and International. The produc-

tion and marketing of digital programming remains the core

component of corporate strategy and will be further expanded.

EVENTS OF PARTICULAR SIGNIFICANCE

Within the context of the insolvency scheme process of

Taurus TV GmbH i. I., a settlement arrangement was concluded

between Axel Springer AG, Taurus TV GmbH i. I., KirchMedia

GmbH & Co. KGaA i. I. and other parties. Under the settlement

arrangement, Axel Springer AG agrees to waive its rights arising

from the put option claim which is in dispute between the

parties involved. In return, Axel Springer AG will retain its

indirect holding in ProSiebenSAT.1 Media AG of 10.2%, will

increase this by 1.8% with no financial consideration, and will

receive from Taurus TV GmbH i. I. a payment of a 60.3 million.

Overall, the settlement impacted EBITA for the nine months

by a 92.6 million and net income of the period by a 62.3 milli-

on. In addition, the insolvency administrator of KirchMedia

GmbH & Co. KGaA i. I. will recognize a claim in the schedule

of debts in an amount of a 325 million in favor of Axel Springer

AG. The claim will be taken into account in the further insol-

vency proceedings.

OUTLOOK

The Fall Report of the leading German economic research

companies anticipates economic growth for 2004 of 1.8%. In

the course of the rest of 2004, the growth is to be carried by

the global economic upswing, while private consumption is

expected to stagnate (0.0%). According to the Fall Report, the

export boom is set to weaken considerably in the second half

of the year.

Despite the upturn in advertising revenues in the first nine

months of the year, a sustained recovery is not expected on

the advertising market. No real market recovery is expected in

2005. There is no short-term recovery in sight for classified ads.

On the basis of ongoing success in the introduction of new

newspapers and magazines combined with further cost cutting

effects and the result of the first nine months, the Management

Board continues to expect that sales and EBITA for the whole

of the 2004 financial year will be higher than 2003, even

before adjustment for the Kirch settlement.

10

I N T E R I M F I N A N C I A L S TAT E M E N T SC O N S O L I D AT E D B A L A N C E S H E E T S

Assets Sept. 30, 2004in d’000

Dec. 31, 2003in d’000

A. Fixed assets

I. Intangible assets 158 475 161 160

II. Tangible assets 1 041 337 1 034 565

III. Financial assets 178 422 88 785

1 378 234 1 284 510

B. Current assets

I. Inventories 54 799 50 341

II. Accounts receivable and other assets 303 434 356 940

III. Securities 1) 185 516 189 104

IV. Cash and cash equivalents 375 777 294 807

919 526 891 192

C. Prepaid expenses 15 047 7 081

2 312 807 2 182 783

Stockholders’ equity and liabilities Sept. 30, 2004in d’000

Dec. 31, 2003in d’000

A. Stockholders’ equity

I. Subscribed capital 102 000 102 000

II. Revenue reserves 663 217 618 967

III. Consolidated retained earnings 0 80 891

IV. Consolidated net income 124 034 0

V. Minority interests 4 976 5 794

894 227 807 652

B. Provisions 903 468 826 983

C. Liabilities 450 823 490 712

D. Deferred income 64 289 57 436

2 312 807 2 182 783

1) Includes own shares of c 181.2 million

11

C O N S O L I D AT E D I N C O M E S TAT E M E N T S

Q3/2004in d’000

1) Q3/2003in d’000

1) Q1 – 3/2004in d’000

2) Q1 – 3/2003in d’000

2)

1. Sales 598 790 588 921 1 831 151 1 788 807

2. Change in inventories of finished goodsand work in progress 4 744 5 587 4 266 2 121

3. Other operating income 107 975 14 170 140 479 105 501

4. Cost of materials – 189 787 – 184 934 – 559 608 – 543 838

5. Gross profit 521 722 423 744 1 416 288 1 352 591

6. Personnel costs – 199 903 – 210 133 – 590 181 – 603 388

7. Depreciation/amortisation of intangibleand tangible assets – 26 959 – 26 284 – 82 376 – 93 202

8. Other operating expenses – 179 970 – 155 602 – 530 495 – 507 293

9. Income from equity holdings 8 140 6 083 22 281 19 284

10. Net interest balance – 670 1 649 – 3 330 2 277

11. Depreciation of financial assets andmarketable securities – 161 – 70 – 161 – 70

12. Group income from operations 122 199 39 387 232 026 170 199

13. Taxes – 50 677 – 23 310 – 105 946 – 63 950

14. Consolidated net income 71 522 16 077 126 080 106 249

thereof earnings attributable to minority shareholders 1 313 112 2 046 – 156

EBITA reconciliation

Income from operations 122 199 39 387 232 026 170 199

Net interest balance 670 – 1 649 3 330 – 2 277

Goodwill amortisation 4 343 6 931 16 783 33 574

EBITA including extraordinary items 127 212 44 669 252 139 201 496

Extraordinary items – 271 – 77 9 653 – 37 826

Adjusted EBITA 126 941 44 592 261 792 163 670

1) Q3: 3rd quarter2) Q1 – 3: Januar 1 to September 30

12

C O N S O L I D AT E D S TAT E M E N T S O F C A S H F L O W

Q1 – 3/2004in d’000

1) Q1 – 3/2003in d’000

1)

Consolidated net income 126 080 106 249

Depreciation/appreciation of fixed assets 82 301 93 272

Change in provisions 78 544 62 282

Other expenses/income with no cash effect – 32 810 0

Income/loss from the disposal of fixed assets 3 077 – 50 881

Changes in inventories, receivables and other assets 2 222 68 431

Change of other borrowed funds – 56 942 – 20 845

Cash flow from operating activities 202 472 258 508

Outflow for capital expenditure on fixed assets – 89 162 – 115 188

Inflow from the sale of consolidated companies 10 000 65 052

Cash flow from investment activities – 79 162 – 50 136

Change in financial liabilities – 7 381 4 419

Dividends paid – 38 481 – 25 655

Other changes 3 364 2 627

Cash flow from financing activities – 42 498 – 18 609

Total cash flow 80 812 189 763

Funds on September 30, 2004 380 072

Funds on January 1, 2004 – 299 326

+/– Changes in funds due to differences in the companies consolidated 66

Changes in funds with cash effects 80 812

1) Q1 – 3: January 1 to September 30

In the statements of cash flow the payment flows are divided into the areas of operating, investment and financing activities.

As company liquidity, other securities in current assets and cash and cash equivalents are included in funds.

13

Q3 1)

in d million

Newspapers Magazines PrintingElectronic

MediaOther/

Consolidation Total

2004 2003 2004 2003 2004 2003 2004 2003 2004 2003 2004 2003

External sales 341.3 329.7 179.5 177.6 37.5 32.4 13.0 22.4 27.5 26.8 598.8 588.9

Internal sales 3.6 5.4 0.8 0.5 115.5 112.5 1.6 0.5 2.2 1.6

Segment sales 344.9 335.1 180.3 178.1 153.0 144.9 14.6 22.9 29.7 28.4

Sales in Germany 314.2 314.0 137.1 129.9 143.1 137.7 14.5 22.8 25.8 25.6

Sales outside Germany 30.7 21.1 43.2 48.2 9.9 7.2 0.1 0.1 3.9 2.8

Segment sales 344.9 335.1 180.3 178.1 153.0 144.9 14.6 22.9 29.7 28.4

EBITA 48.7 42.8 – 6.6 5.9 0.5 0.5 86.1 – 2.9 – 1.8 – 2.1 126.9 44.2

of which depreciation – 7.2 – 4.5 – 3.6 – 2.5 – 10.8 – 8.3 – 0.7 – 0.6

of which incomefrom equity holdings 2.5 2.3 1.3 2.0 0.5 0.4 1.0 0.8

Employees (average) 5 145 5 169 2 888 2 841 2 482 2 644 285 350

G R O U P S E G M E N T R E P O RT

Q1 – 3 2)

in d million

Newspapers Magazines PrintingElectronic

MediaOther/

Consolidation Total

2004 2003 2004 2003 2004 2003 2004 2003 2004 2003 2004 2003

External sales 1 048.3 1 003.3 553.5 550.7 100.3 95.1 44.8 51.3 84.3 88.4 1 831.2 1 788.8

Internal sales 8.0 9.4 1.6 1.3 348.6 341.9 4.1 2.0 7.7 5.6

Segment sales 1 056.3 1 012.7 555.1 552.0 448.9 437.0 48.9 53.3 92.0 94.0

Sales in Germany 969.6 951.4 414.5 405.5 421.3 409.2 48.3 53.0 80.3 81.9

Sales outside Germany 86.7 61.3 140.6 146.5 27.6 27.8 0.6 0.3 11.7 12.1

Segment sales 1 056.3 1 012.7 555.1 552.0 448.9 437.0 48.9 53.3 92.0 94.0

EBITA 165.2 123.9 8.3 40.6 1.5 1.2 87.3 – 3.6 – 0.5 1.6 261.8 163.7

of whichdepreciation – 21.4 – 21.5 – 9.5 – 9.5 – 30.3 – 25.1 – 3.5 – 2.6

of which incomefrom equity holdings 7.0 7.0 5.5 5.8 1.5 1.3 4.2 3.6

Employees (average) 5 121 5 209 2 881 2 819 2 502 2 659 324 360

1) Q3: 3rd quarter 2) Q1 – 3: January 1 to September 30

EBITA (Earnings before Interest, Taxes and Amortisation) is used for division sales.

14

Parent company Minority interests

Subscribed

capital

Generated

Group equity

Accumulated other

comprehensive income

in e’000

Ordinary shares Adjustment item

from currency

translation

Adjustment from

initial application

of the German

Transparency and

Disclosure Act Equity

Minority

capital

Adjustment item

for currency

translation Equity Group equity

December 31, 2003 102 000 426 718 – 3 334 276 474 801 858 5 976 – 182 5 794 807 652

Dividends paid 0 – 36 720 0 0 – 36 720 – 1 761 0 – 1 761 – 38 481

Miscellaneous

changes 0 0 79 0 79 – 1 103 0 – 1 103 – 1 024

Net income

for the period 0 124 034 0 0 124 034 2 046 0 2 046 126 080

September 30, 2004 102 000 514 032 – 3 255 276 474 889 251 5 158 – 182 4 976 894 227

Parent company Minority interests

Subscribed

capital

Generated

Group equity

Accumulated other

comprehensive income

in e’000

Ordinary shares Adjustment item

from currency

translation

Adjustment from

initial application

of the German

Transparency and

Disclosure Act Equity

Minority

capital

Adjustment item

for currency

translation Equity Group equity

December 31, 2002 102 000 319 527 – 653 0 420 874 6 333 – 135 6 198 427 072

Dividends paid 0 – 22 100 0 0 – 22 100 – 3 555 0 – 3 555 – 25 655

Revaluation

of fixed assets 0 0 0 276 474 276 474 0 0 0 276 474

Miscellaneous

changes 0 0 – 311 0 – 311 2 656 – 29 2 627 2 316

Net income

for the period 0 106 405 0 0 106 405 – 156 0 – 156 106 249

September 30, 2003 102 000 403 832 – 964 276 474 781 342 5 278 – 164 5 114 786 456

C O N S O L I D AT E D S TAT E M E N T S O F S T O C K H O L D E R S ’ E Q U I T Y

15

EXPLANATORY NOTES TO THE INTERIM FINANCIAL STATEMENTS

Axel Springer Group

General notesThe interim report on the period between January and September 2004 was prepared in line with the German Accounting

Standard No. 6 (DRS 6) – Interim Reporting – of the German Accounting Standards Committee e. V. (DRSC).

The accounting and valuation methods used for the interim financial statements as of September 30, 2004 correspond to those

used in the consolidated financial statements as of December 31, 2003.

Consolidated companiesIn the consolidated financial statements as of September 30, 2004, 35 German and 17 foreign companies were included in

consolidation, in addition to Axel Springer AG. Thereof, four joint ventures were consolidated on a pro rata basis.

Following the transfer of its orders to Axel Springer AG, GMZ Druckerei GmbH & Co. was deconsolidated and discontinued

with effect of January 1, 2004, since the business was transferred to Axel Springer AG. AS Media Service GmbH was transferred

to Ullstein GmbH.

Berlin, November 2004

Axel Springer AG

The Management Board

Report of the Supervisory Board Audit CommitteeThe interim report for the period January to September 2004 and the report of the auditor on the audit examination of the

interim financial statements were submitted to the Supervisory Board Audit Committee. The documents were explained by

the Management Board and discussed with the auditor. The Audit Committee approved the interim financial statements.

Berlin, November 2004

Chairman of the Audit Committee

Dr. Giuseppe Vita

DisclaimerThis Interim Report contains forward-looking statements with the connected risks and imponderables. The actual development

of business and profits at Axel Springer AG and the Group may deviate materially in the future from the assumptions made in

this Interim Report. This Interim Report represents neither an offer for sale nor the request to submit an offer for the securities

of Axel Springer AG. The publication of this Interim Report does not bring with it an obligation to update the statements

made in it.

16

Financial calendar

Annual Results Press Conference March 9, 2005

Annual shareholders’ meeting April 20, 2005

Interim Report January – March 2005 May 2005

Interim Report January – June 2005 August 2005

Interim Report January – September 2005 November 2005

Share information Q1 – 3/2004in d

1) Q1 – 3/2003in d

1)

DVFA/SG earnings per share 2) 4.36 1.81

Closing price 3) 88.20 54.50

Highest price 91.00 63.00

Lowest price 70.00 41.00

Average price 84.36 48.05

Listing segment General Standard

Security identification number 550 135

ISIN DE0005501357

Reuters SPRGn.F

Bloomberg SPR GR

1) Q1 – 3: January 1 to September 302) Calculation basis: 34.0 million shares in Q1 – 3/2003; 30.6 million shares

in Q1 – 3/2004 (excluding own shares) 3) As of September 30, 2004 and September 30, 2003

The Interim Report and current information on

Axel Springer AG are available on the Internet:

www.axelspringer.de

This Interim Report is also available in German.

For more information on the Interim Report,

please contact:

Axel Springer AG

Investor Relations

e-mail: ir@axelspringer.de

Axel-Springer-Straße 65

10888 Berlin

Telephone: + 49 (0) 30 25 91-7 74 20/7 74 21

Fax: + 49 (0) 30 25 91-7 74 22