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QUARTERLY FINANCIAL REPORT 3 2015 / 2016

KEY FIGURES OF THE SINNER SCHRADER GROUP

Q3 2015/2016 Q3 2014/2015 CHANGE 9M 2015/2016 9M 2014/2015 CHANGE

Gross revenues € 000s 13,374 12,524 +7 % 38,396 37,892 +1 %

Net revenues € 000s 13,374 11,324 +18 % 38,168 34,301 +11 %

EBITDA € 000s 1,577 1,105 +43 % 3,302 1,766 +87 %

EBITA € 000s 1,403 825 +70 % 2,753 911 +202 %

Relation of the EBITA to net revenues

(Operating margin) % 10.5 7.3 +44 % 7.2 2.7 +172 %

EBIT € 000s 1,403 825 +70 % 2,753 911 +202 %

Net income € 000s 977 427 +129 % 1,924 408 +372 %

Net income per share 1) € 0.09 0.04 +126 % 0.17 0.04 +367 %

Shares outstanding 1) number 11,472,213 11,435,727 +0 % 11,487,311 11,399,793 +1 %

Cash flows from operating activities € 000s –1,311 1,374 –195 % –191 36 –631 %

Employees, full-time equivalents number 443 473 –6 % 446 482 –8 %

31.05.2016 31.05.2015 CHANGE 31.05.2016 31.08.2015 CHANGE

Liquid funds and securities € 000s 2,579 4,171 –38 % 2,579 5,559 –54 %

Shareholders’ equity € 000s 14,411 13,293 +8 % 14,411 14,959 –4 %

Balance sheet total € 000s 24,123 24,635 –2 % 24,123 27,730 –13 %

Shareholders’ equity rate % 59.7 54.0 +11 % 59.7 53.9 +11 %

Employees, end of period number 494 514 –4 % 494 506 –2 %

1) Weighted average shares outstanding

01 INTERIM STATUS REPORT 3 2015/2016

05 GENERAL 05 GROUP BUSINESS AND STRUCTURE 06 MARKET AND COMPETITIVE ENVIRONMENT 07 BUSINESS DEVELOPMENT AND GROUP SITUATION 15 RISKS AND OPPORTUNITIES OF FUTURE BUSINESS DEVELOPMENT 15 MAJOR EVENTS AFTER THE BALANCE SHEET DATE 16 FORECAST

02 CONSOLIDATED QUARTERLY ACCOUNTS 3 2015/2016

18 CONSOLIDATED BALANCE SHEETS 20 CONSOLIDATED STATEMENTS OF OPERATIONS 21 CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME 22 CONSOLIDATED STATEMENTS OF SHAREHOLDERS’ EQUITY 24 CONSOLIDATED STATEMENTS OF CASH FLOWS 26 NOTES

03 FURTHER INFORMATION

35 EVENTS & CONTACT INFORMATION

CONTENTS

0101 | INTERIM STATUS REPORT 3 2015/2016 05–16

02 | CONSOLIDATED QUARTERLY ACCOUNTS 3 2015/2016 18–33

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1 GENERAL

This Interim Status Report of the SinnerSchrader Group (“SinnerSchrader” or “Group”) as at 31 May 2016 represents

the development of the income, financial, and assets status of the Group which is managed by SinnerSchrader Aktien-

gesellschaft (“SinnerSchrader AG” or “AG”) in the first nine months and the third quarter of the 2015/2016 financial year

from 1 September 2015 and 1 March 2016, respectively, to 31 May 2016. It deals with the major risks and opportunities

and the probable developments in the remainder of the financial year.

The consolidated financial statements on which this status report is based were drawn up according to the International

Financial Reporting Standards (“IFRS”). The Interim Status Report, particularly Section 7, contains statements and

information aimed at the future. These forward-looking statements are based on current knowledge, estimates, and

assumptions and therefore entail a number of risks and uncertainties. A variety of factors, many of which are outside

SinnerSchrader’s sphere of influence, have an impact on the business development and results. These factors mean

that the actual future business development of SinnerSchrader and the actual results achieved may differ significantly

from the explicit or implicit information in the forward-looking statements.

This quarterly financial report should be read in conjunction with the Consolidated Financial Statements of

SinnerSchrader AG for the 2014/2015 financial year.

2 GROUP BUSINESS AND STRUCTURE

The SinnerSchrader Group is a digital agency group which offers companies in Germany and abroad a comprehensive

range of services for the use of digital technologies to optimise and further develop their business. The emphasis is on

the use of the Internet for the sale of goods and services (e-commerce), for marketing and communication, and for the

acquisition and retention of customers.

With around 500 employees, SinnerSchrader is one of the biggest independent digital agency groups in Germany and

performs its services at locations in Hamburg, Frankfurt am Main, Berlin, Hanover, Munich and Prague. SinnerSchrader

mainly works for companies based in Germany, but also counts companies from Switzerland, the UK, the Netherlands,

France, Austria and Luxembourg among its clients.

The consolidation group has not changed in comparison to the status on 31 August 2015 and 29 February 2016,

respectively. In the quarter of the report, the SinnerSchrader Group thus consisted of SinnerSchrader AG in addition to

SinnerSchrader Deutschland GmbH, SinnerSchrader Mobile GmbH, SinnerSchrader Praha s.r.o., the NEXT AUDIENCE

Group, comprising NEXT AUDIENCE GmbH and SinnerSchrader Content GmbH, and the Commerce Plus Group, made

up of Commerce Plus GmbH and Commerce Plus Consulting GmbH. Moreover, the operationally inactive companies

SinnerSchrader UK Ltd. in London and SinnerSchrader Benelux BV in Rotterdam are still part of the consolidation group.

As decided and announced at the end of June 2015, SinnerSchrader withdrew from the online media business conducted

directly by NEXT AUDIENCE GmbH during the course of the first half of the 2015/2016 financial year. This process was

completed according to schedule in the first nine months of the financial year.

The SinnerSchrader Group continues to structure its business activity in the Interactive Marketing, Interactive Media and

Interactive Commerce segments. The Interactive Marketing segment comprises SinnerSchrader Deutschland GmbH,

SinnerSchrader Mobile GmbH and SinnerSchrader Praha s.r.o. The Interactive Media segment is formed by the NEXT

AUDIENCE Group, and the Interactive Commerce segment by the Commerce Plus Group.

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3 MARKET AND COMPETITIVE ENVIRONMENT

On 23 June 2016 the British people voted in favour of the UK leaving the European Union. Until this happened, estima-

tions from the economic environment in Germany were stable to positive again in the period of the third quarter of the

SinnerSchrader financial year from March to May 2016, after a weak phase in the first two months of 2016.

The Federal Statistical Office reported that the German economy had made a “powerful” start to 2016. In the first

calendar quarter of 2016, the gross domestic product adjusted by price, seasonal and calendar effects grew by 0.7 %

in comparison to the preceding fourth calendar quarter of 2015. Economic performance thus grew by 1.3 % over that

of the previous year on a price-adjusted basis. In its explanations, the Federal Statistical Office referred in particular

to investment activities which, in comparison to the previous quarter, had been a driver of the positive development.

Private consumption also rose again.

Against this background, the forecasts for the economy in 2016 were relatively stable. Some of the updates undertaken

in June 2016 again revealed a rise in the growth forecast for the current calendar year. The majority of respective latest

growth estimates for the price-adjusted gross domestic product issued by various economic experts and national and

international organisations show growth of 1.5 % to 1.8 %.

In line with this development, the ifo business climate index has managed to work its way out of the “February hole”

again. Surveys carried out in April, May and June showed that business expectations in particular had recovered again

considerably to raise the index to 108.7 points, thus slightly higher than the level for June of the previous year, after it

had fallen to 105.8 points in February 2016.

In contrast, the ifo economic survey has shown a more volatile mood development for the service segment in the past

few months. The indicator did, however, show that the figure had recovered again to 27.2 points in the most recent

survey carried out in June, although it nevertheless remained significantly behind the peaks of more than 34 points in

the previous year.

The surprising decision by the British people at the end of June 2016 to leave the EU has without doubt given rise to new

risks for economic development in Europe as well as in Germany. However, after the initial shock, the situation seems to

be calming down again somewhat on the securities markets.

Reluctance with respect to investments in digital transformation projects in the private sector, which are important for

the development of SinnerSchrader business, was not perceived during the course of the third quarter of the 2015/2016

financial year and beyond, right up to the days following the British vote to leave the EU. If anything, the picture is being

dominated by positive items of news, such as the announcement made by insurance group ERGO at the beginning of June,

stating that the group intends to invest € 1 billion in order to benefit from digitisation opportunities.

After IBM had taken over the digital agencies Aperto and ecx.io at the beginning of February 2016, Accenture’s takeover

of dgroup, a management consulting firm specialised in digitalisation projects, announced at the end of June, also

emphasises how attractive the German market is for digital services. The abundance of digitisation activities is obviously

transforming competition for customers and orders into competition for talents who will be able to master the tasks.

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4 BUSINESS DEVELOPMENT AND GROUP SITUATION

The positive business development of the SinnerSchrader Group continued in the third quarter of the 2015/2016 financial

year, and gained more momentum, as expected.

Net revenue reached a volume of € 13.4 million, an increase of 18.1 % over the same quarter of the previous year; adjust-

ed by the withdrawal from NEXT AUDIENCE business the increase was 24.5 %. SinnerSchrader increased revenue by 11.6 %

(12.1 % after adjustment) over that of the preceding second quarter, which was as usual weak due to the seasonal effect.

The positive development in revenue in the quarter of the report was reflected in another upswing in the EBITA: the

operating result increased by just under € 0.6 million to € 1.4 million in the third quarter of 2015/2016 in comparison to

the previous year. At the same time, this figure clearly exceeded the results of € 0.8 million in the first quarter and

SINNERSCHRADER GROUP WITHOUT NEXT AUDIENCE NEXT AUDIENCE

Q2 2014/2015

Q2 2014/2015

Q3 2014/2015

Q3 2014/2015

0.7

0.7

11.7

9.9

12.4

11.3

13.412.8

12.0

13.4

0.6

10.7

10.6

Q1 2014/2015

Q1 2014/2015

Q2 2015/2016

Q2 2015/2016

Q3 2015/2016

Q3 2015/2016

Q4 2014/2015

Q4 2014/2015

Q1 2015/2016

Q1 2015/2016

0.50.2

0.1

0.0

12.912.6

11.9

13.4

5.9 %

2.2 %

10.8 %0.4%

–1.8 %

18.2 %

8.8 %7.3 %

8.7 %

6.5 %

5.2 %

4.3 %

11.2 %

10.5 %

REVENUES

NET REVENUE MARGIN

DEVELOPMENT OF THE OPERATIVE KEY FIGURES REVENUES AND NET REVENUE MARGIN

in € mil l ion and %

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€ 0.5 million in the second quarter, in line with plans. The reduction of losses from NEXT AUDIENCE business contributed

to the positive operating development, in comparison to the previous year and in the quarterly development of the current

financial year.

The positive operating result meant that net income of just under € 1.0 million, or € 0.09 per share, was generated in the

quarter of the report. The net income was € 0.4 million in the comparable period of the previous year, which corresponds

to € 0.04 per share.

Accumulated over the first nine months of the financial year, the SinnerSchrader Group achieved revenue of € 38.2

million, an operating result of € 2.75 million and net income of a good € 1.9 million or just under € 0.17 per share. In the

course of the 2015/2016 financial year to date, SinnerSchrader has thus achieved an increase in revenue of 11.3 %

(adjusted: 17.5 %). Supported by the withdrawal from NEXT AUDIENCE business, the operating result has tripled and net

income has increased nearly fivefold.

In spite of the clear increase in profit, SinnerSchrader fell slightly short of its planned EBITA development. Difficulties

with the further optimisation of capacity management, which was scheduled for the third quarter, were also due to delays

in new-customer decisions and the related supply of resources and to a tightening human resources market.

At € –0.2 million, the operating cash flow was slightly negative in the nine-month period of the current financial year. This

mainly results from changes to the payment flows from the shops managed in the Interactive Commerce segment. The

cash flow was only just positive in the comparable period of the previous year. The dividend payment and the share buy-

back programme resulted in a decrease in liquid funds to € 2.6 million as at the quarterly reporting date on 31 May 2016.

In the first nine months of the 2015/2016 financial year, the average personnel capacity, at 446 full-time employees,

fell short of that of the previous year by around 36 employees mainly as a result of the withdrawal from NEXT

AUDIENCE business.

The following describes the development of the income, financial and assets status in the third quarter and in the first

nine months of the 2015/2016 financial year.

NET REVENUES BY SEGMENTin € mil l ion for 9M 2015/2016 in comparison to 9M 2014/2015

9M 2015/2016 9M 2014/2015

INTERACTIVE COMMERCE

HOLDING/CONSOLID.

INTERACTIVE MARKETING

INTERACTIVE MEDIA

5.7

–0.8–0.5

29.9

3.2

6.17.7

24.9

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4 .1 REVENUES

SinnerSchrader generated net revenue of € 13.4 million in the third quarter of 2015/2016, thus exceeding the com-

parable value of the previous year by just under € 2.05 million, or 18.1 %. Adjusted by the decrease in revenue of almost

0.6 million as a result of the withdrawal from NEXT AUDIENCE business, SinnerSchrader achieved growth of 24.5 %

in the third quarter.

The segments all contributed to growth over the comparable quarter of the previous year on an adjusted basis. The

Interactive Media segment, in which SinnerSchrader has mainly been operating content marketing business since it with-

drew from NEXT AUDIENCE business, enjoyed the strongest growth at more than 50 %. The Interactive Marketing segment

increased by around 26 % and the Interactive Commerce segment by just under 15 %.

The development of revenue in all the segments was characterised by the work carried out for existing clients and the

new clients acquired in the first six months of the financial year. However, demand for digital consulting and implemen-

tation services remained high in this period as well. During this time, SinnerSchrader mainly concentrated on the tender

to be worldwide lead digital agency for car manufacturer Audi, which it won in the face of international competition at

the beginning of July.

In the first nine months of 2015/2016, SinnerSchrader achieved sales revenue of € 38.2 million, thus exceeding the figure

for the previous year by € 3.9 million, or 11.3 %. Adjusted by the loss in revenue in the amount of a good € 1.7 million due

to the withdrawal from NEXT AUDIENCE business, the increase in revenue amounted to an absolute € 5.6 million, which

corresponds to a growth rate of 17.5 %.

The content marketing business conducted by the Interactive Media segment showed the greatest adjusted dynamism

in the nine-month period as well, with the business volume increasing by around 23 %. The Interactive Marketing seg-

ment increased its nine-month revenue by a good 20 %, and the Interactive Commerce segment generated an increase

of more than 5 %.

DEVELOPMENT OF THE REVENUE STRUCTURE ACCORDING TO CLIENT SIZE AND SECTOR in % for 9M 2015/2016 in comparison to 9M 2014/2015 and the 2014/2015 f inancial year

FINANCIAL YEAR2014/2015

9M2015/2016

9M2014/2015

FINANCIAL YEAR2014/2015

9M2015/2016

9M2014/2015

TOP 1 TOP 2–5 TOP 6–10

RETAIL & CONSUMER GOODS FINANCIAL SERVICES TELECOMMUNICATIONS & TECHNOLOGY

TRANSPORT & TOURISM MEDIA & ENTERTAINMENT OTHER

74.1 100 %

73.474.7 3.5

28.1

16.6

4.2

15.9

31.7

4.6

33.9

19.1

3.0

12.3

27.1

3.9

26.0

17.2

5.5

16.8

30.6

18.0

15.9

40.2

19.7

17.8

35.9

19.4

16.2

39.1

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Of the € 38.2 million in revenue for the nine-month period, a good € 5.2 million was generated with clients with which

no business relationship had existed in the comparable period of the previous year. This corresponds to a new-client

rate of 13.7 %. The new clients include Volkswagen, Leica, HSE24 and Europa-Park. The new-client rate was only 4.4 % in

the previous year.

New clients were thus the engine of business development in the first nine months of the current financial year. In total,

business with existing clients resulted in only a slight € 0.4 million increase in revenue.

The good new-client rate meant that the concentration of revenue on individual client relationships did not continue to

increase against the previous year; instead it decreased slightly. In the first nine months of the 2015/2016 financial year,

the biggest client accounted for 17.8 % of the revenue, the five largest clients for 53.7 %, and the ten largest clients for

73.4 %. The shares in revenue were at 16.2 %, 55.3 %, and 74.7 %, respectively, in the comparable period, and in the previ-

ous year as a whole they accounted for 15.9 %, 56.1 % and 74.1 %, respectively.

The trends observed so far in terms of the sector mix can also be confirmed after the nine months under review in the

current financial year: The volumes of revenue generated by existing clients in the Financial Services sector have

increased considerably, the share of clients in the Telecommunications & Technology sector decreased after significant

increases in the previous years due to the insourcing strategies implemented for some existing clients, the share of the

Transport & Tourism sector increased as a result of the encouraging acquisition of new clients, and the Retail & Consumer

Goods and Media & Entertainment sectors continued to decrease in significance.

The shares in revenue for the above-mentioned sectors were 33.9 %, 27.1 %, 19.1 %, 12.3 % and 3.0 %, respectively, in the

nine-month period. The respective shares in the full financial year of 2014/2015 were 28.1 %, 31.7 %, 16.6 %, 15.9 % and

4.2 %. In the nine-month period, 4.6 % of the revenue could not be allocated to the five sectors; the corresponding figure

for the previous year as a whole was 3.5 %.

4 .2 OPERATING RESULT (EBITA)

The positive development in revenue in the third financial quarter of 2015/2016 resulted in a significant increase in the

operating result. In comparison to the third quarter of the previous year, the EBITA improved by just under € 0.6 million, or

70 %, to reach € 1.4 million.

The operating development of all three segments contributed to the improvement in the profit. The end of losses incurred

in NEXT AUDIENCE business also played a significant role in this development. Without taking the negative NEXT AUDIENCE

contributions into account, the rise in earnings over the adjusted EBITA of the same quarter in the previous year was 29 %.

The operating margin of the SinnerSchrader Group amounted to 10.5 % in the quarter of the report, and 11.2 % without

the remaining losses still incurred by NEXT AUDIENCE. The comparable figures for the same quarter in the previous year

were 7.3 % and 10.8 %, respectively.

SinnerSchrader was thus able to improve its operating margin overall, although the increase in the margin nevertheless

remained behind the plan. This was also due to the increase in the Company’s own staff falling behind schedule, resulting

in higher costs for freelancers than planned, and to a delayed decision concerning the Audi tender procedure, with the

latter resulting in a lower level of capacity utilisation than planned due to maintaining a supply of resources. Over and

above this, contribution margin problems arose in three of the Group’s projects, with an additional negative effect on the

development of the margin.

Accumulated over the first nine months of the 2015/2016 financial year, SinnerSchrader generated an operating result in

the amount of € 2.75 million, thus trebling the figure of € 0.9 million for the previous year. The reduction in NEXT AUDIENCE

losses played a significant role in this marked rise in profits. Without taking account of NEXT AUDIENCE, the EBITA improved

by around 70 % over that for the same period in the previous year.

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The Interactive Marketing segment accounted for € 0.9 million of the € 1.8 million increase in earnings in the nine-month

period; the Interactive Media segment accounted for € 0.5 million, the Interactive Commerce segment for € 0.2 million,

and costs for the holding company which are not allocated to the segments amounted to € 0.2 million. Almost all of the

increase in earnings in the Interactive Media segment was due to the reduction in NEXT AUDIENCE losses. The increase

in earnings in the holding company mainly resulted from raising the shares in allocated costs due to the increase in the

volume of business generated by the operative segments.

Around half of the increase in the nine-month result over that of the previous year is from the € 0.9 million improvement

in the gross profit. The increase in the volume of business was a significant factor in the development of the gross profit.

The gross margin increased only slightly by 0.1 percentage points, to 23.1 %. It was not possible to maintain the trend in

the development of the gross margin in the first half of 2015/2016 in the nine-month period due to the negative factors

already mentioned which occurred in the third quarter of 2015/2016. The gross margin of 23.9 % achieved in the quarter

of the report fell short of the figure for the same quarter of the previous year by 2.7 percentage points.

The other half of the improvement in the EBITA, i. e. another € 0.9 million, resulted from the sales costs and the research

and development costs being considerably lower than in the previous year. With shares of € 0.8 million and € 0.4 million,

respectively, the two changes resulted to a large extent from the withdrawal from NEXT AUDIENCE business.

The fact that it had already been possible to acquire significant, new-client relationships in the final few months of the pre-

vious year was also significant for the marked reduction in sales costs against those of the previous year. SinnerSchrader

also focused mainly on the Audi tender in the late second quarter and in the third quarter. Besides, it was possible to

cover the costs for organising the trend conference NEXT and the European JavaScript conference JSConf EU in the first

month of the period of the report by way of income from tickets and sponsoring.

The sales costs fell by 3.1 percentage points and the research and development costs by 1.2 percentage points in relation

to the revenue.

Contrary to the development of sales costs and research and development costs, general administrative costs rose by

€ 0.2 million in absolute terms; the positive balance of the other income and expenses decreased in absolute terms by a

EBITA BY SEGMENTin € mil l ion for 9M 2015/2016 in comparison to 9M 2014/2015

9M 2015/2016 9M 2014/2015


HOLDING/CONSOLID.

INTERACTIVE MARKETING

INTERACTIVE MEDIA

0.20.3

–0.5–0.8

2.8

–0.3

1.8

0.2

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good € 0.1 million. The increase in administrative costs was disproportionately lower than the increase in revenue; the

costs thus fell by 0.5 percentage points in relation to revenue.

A review of the cost structure broken down by cost type for the SinnerSchrader Group shows that personnel costs in

the first nine months of the 2015/2016 financial year were 1.4 % lower than the expenses in the same period of the previ-

ous year. The reason for this is the reduction in the personnel capacity by around 36 full-time employees in the period

of the report in comparison to the capacity of the previous year. The reduction in staff is mainly the result of the NEXT

AUDIENCE team being completely disbanded as at 31 December 2015. However, the capacity fell short of the plan by

approximately 14 full-time employees for the full period of the current financial year, since it had not been possible to

achieve the recruitment targets due to the tighter human resources market.

As a result, the cost of purchased goods and services grew disproportionately in the first nine months in comparison

to the previous year due to a higher need for external service providers. Other operating expenses also increased more

than revenue in the period of the report. This was also due to more training initiatives and increased costs for recruiting

personnel. Depreciation fell markedly against the trend since the depreciation on capitalised development costs for the

NEXT AUDIENCE software incurred in the nine-month period of the previous year was no longer applicable in the period

of the report.

Development of costs by funct ion

9M 2015/2016 9M 2014/2015 CHANGE

IN € 000S IN %1) IN € 000S IN %1) IN %

Cost of revenues 29,340 76.9 26,403 77.0 11.1

Costs of marketing 2,131 5.6 2,976 8.7 –28.4

General and administrative costs 3,737 9.8 3,540 10.3 5.6

Research and development costs 342 0.9 737 2.1 –53.6

Development of costs by cost type

9M 2015/2016 9M 2014/2015 CHANGE

IN € 000S IN %1) IN € 000S IN %1) IN %

Personnel expenses 22,736 59.6 23,062 67.2 –1.4

Costs of materials and services 7,334 19.2 5,416 15.8 35.4

Other operating expenses 4,932 12.9 4,324 12.6 14.1

Depreciation 548 1.4 854 2.5 –35.8

1) As a percentage of net revenues

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4 .3 NET INCOME

In view of the balanced financial result and a tax rate slightly below the statutory rate of a good 32 %, the positive oper-

ating development in the third quarter and in the entire period of the first nine months of the 2015/2016 financial year

was completely reflected in the net income. The stable income situation in content marketing business and the resulting

expected utilisation of losses carried forward in NEXT AUDIENCE business also had a positive influence on the tax rate.

Net income for the third quarter amounted to just under € 1.0 million, hence exceeding the figure for the same period of

the previous year by € 0.55 million. Accumulated over the first nine months of 2015/2016, SinnerSchrader achieved a

consolidated net profit of € 1.9 million, which exceeded the figure for the previous year by a pleasing € 1.5 million. Viewed

per share, the nine-month result was just under € 0.17.

4 .4 CASH FLOWS

The amount of liquid funds decreased again by a good € 1.8 million in the third quarter of 2015/2016.

A significant factor in this was the negative cash flow from operating activities in the amount of around € 1.3 million. On

the one hand this was due to a comparatively high number of large-volume contracts which had neither been concluded

nor billed on the balance sheet reporting date of the quarter of the report, to result in an increase in unbilled services and

receivables from clients of altogether € 1.6 million. On the other hand, a change to the settlement terms for the online

shop managed by Commerce Plus on behalf of a client meant that SinnerSchrader no longer received amounts totalling

more than € 1 million as advance payments received on a revolving basis. At around € 1.3 million, the reduction in lia -

bility items, which also had a negative effect on operating cash flows, was correspondingly high in the third quarter. The

inflow from the quarterly result adjusted by non-cash components in the amount of € 1.5 million was not sufficient to

offset factors with a negative effect on cash.

Besides, investments in the amount of € 0.15 million and expenses for buying back treasury stock in the amount of a

good € 0.35 million resulted in outflows of funds in the quarter of the report.

Combined with the cash flows from the first half of the current financial year, this resulted in a total outflow of liquid

funds of around € 3.0 million in the first nine months of 2015/2016. The outflow in the same period of the previous year

was just under € 1.7 million.

The difference results only from the flows of funds relating to the buying back of treasury stock and the issuing of these

shares as part of the exercising of employee options. While there was an inflow of liquid funds in the amount of € 0.15

million from issuing shares of treasury stock in the same period of the previous year, in the first nine months of

2015/2016, SinnerSchrader purchased treasury stock with a current value of a good € 1.2 million as part of the share

buy-back programme initiated in October 2015, and only took in € 0.1 million from issuing shares of treasury stock.

The operating cash flow in the first nine months of 2015/2016 was slightly negative at € –0.2 million. In the previous year,

it was only just positive. In contrast, SinnerSchrader only spent € 0.3 million on investments in IT and space infrastructure

and in equipment for workstations; in the previous year, € 0.5 million was invested.

The outflow of funds for payment of a dividend in the two years was around € 1.35 million, based on the same dividend

payment of € 0.12 per share.

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4 .5 ASSET AND FINANCIAL SITUATION

In comparison to the total as at 31 August 2015, the balance sheet total fell in the first nine months of 2015/2016 by

€ 3.6 million to € 24.1 million on 31 May 2016. This was mainly due to the simultaneous decrease in operating liability

items on the one hand and liquid funds on the other hand, as well as to the repurchase of treasury stock.

On the asset side, the reduction primarily concerned current assets. The development of non-current assets was rela-

tively stable, accounting for only € 0.15 million of the change in the balance sheet total. Fixed assets decreased as part of

scheduled depreciation in the first nine months of the 2015/2016 financial year due to the low volume of investment.

The shareholders’ equity amounted to € 14.4 million on the balance sheet date of the period of the report, 31 May 2016,

which was around € 0.55 million less than on 31 August 2015. Growth of € 1.9 million resulting from the net income

generated in the nine-month period was matched by the dividend payment of a good € 1.35 million and the increase in

the treasury stock through the share buy-back programme of a good € 1.1 million.

While the reduction in shareholders’ equity corresponded to a change of –3.6 %, the balance sheet total fell by 13.0 %

in the nine-month period up to 31 May 2016. The shareholders’ equity rate thus rose to 59.7 % as at 31 May 2016,

5.8 percentage points higher than on 31 August 2015.

4 .6 EMPLOYEES

After two quarters of decreasing workforce figures, the number of employees in the SinnerSchrader Group increased

again in the third quarter of the 2015/2016 financial year, by 7 employees to 494 employees on 31 May 2016. The figures

of 514 and 506 employees, respectively, on 31 May 2015 and 31 August 2015 were, however, not reached again.

The withdrawal from NEXT AUDIENCE business is the main reason for the decrease in the workforce in the first nine

months of the financial year and in comparison to the previous year. NEXT AUDIENCE still had 39 and 30 employees,

respectively, on 31 May 2015 and 31 August 2015. At the beginning of 2016 there were no longer any employees allocated

to NEXT AUDIENCE.

Adjusted by the withdrawal from NEXT AUDIENCE business, the number of employees thus increased by 18 and 19 em-

ployees, respectively, in the period up to 31 May 2016 in comparison to the numbers on 31 August 2015 and 31 May 2015.

Of the increase in the first nine months after 31 August 2015, 6 employees were allocated to the Interactive Marketing

segment; 343 employees thus worked in this segment on 31 May 2016. The workforce for the content marketing business

conducted by the Interactive Media segment was increased by 7 employees, to 20 employees. The Interactive Commerce

segment increased its employee base by 1 employee, to 84 employees. The number of employees in the holding company

increased by 4 employees, to 47 employees.

Of the 494 employees on 31 May 2016, 8 employees were receiving vocational training. 54 employees were working as

students or completing an internship.

After standardisation of part-time employment relationships and calculated as an average over the period, SinnerSchrader

had a personnel capacity of 443 full-time employees in the third quarter of 2015/2016, after 439 and 454 full-time

employees in the preceding second and first quarters, respectively. In the third quarter of 2014/2015 the capacity was

473 full-time employees.

While NEXT AUDIENCE business no longer had a personnel capacity in the quarter of the report, each of the periods of

comparison still had NEXT AUDIENCE team capacities. After deducting these capacities, the comparable figures for the

two preceding quarters of the current financial year and for the comparable period of the previous year were 434, 435

and 436 employees, respectively.

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On an adjusted basis, the increase in capacity against the previous year was thus only 1.5 % in the quarter of the report,

which meant that SinnerSchrader fell significantly short of the planned increase in the number of staff. It was only pos-

sible to achieve the increase in revenue of 24.5 % on an adjusted basis in the quarter of the report with a considerable in-

crease in the freelancer rate. In the quarter of the report, this rate increased substantially from 4.9 % to 15.3 % in com-

parison to the previous year.

The personnel capacity in the nine-month period of the current financial year, at 437 employees without the NEXT AUDI-

ENCE team, fell short of the figure of 445 full-time employees in the previous year by 8 full-time employees. The realisa-

tion of growth in revenue of 17.5 % thus necessitated an increase of 5.7 percentage points to 14.7 % in the freelancer rate

for the nine-month period.

The number of staff was only reduced in the Interactive Commerce segment, in which the number of full-time employees

fell by 12 to 71 full-time employees in the nine-month period. The capacity in the Interactive Marketing segment remained

stable at 314 full-time employees. In the Interactive Media segment, the personnel capacity in content marketing business

was increased by 3 employees, to 15 full-time employees. The personnel capacity in the holding company rose by 1 em-

ployee, to 37 full-time employees.

Broken down according to areas of expertise, 117 full-time employees were assigned to consulting (strategy, client ser-

vices and media planning and purchasing), 164 to technology, 108 to creation, and 48 to administrative activities in the

first nine months of the 2015/2016 financial year. Without the NEXT AUDIENCE team, the comparative figures for the pre-

vious year were 127, 167, 105 and 46 full-time employees, respectively.

5 RISKS AND OPPORTUNITIES OF FUTURE BUSINESS DEVELOPMENT

With respect to risk management at SinnerSchrader and the main risks and opportunities in particular, there were no

major changes in the first nine months of 2015/2016 in comparison to the situation outlined in the 2014/2015

Annual Report. There are still no identifiable risks that could endanger the existence of the SinnerSchrader Group or

SinnerSchrader AG.

6 MAJOR EVENTS AFTER THE BALANCE SHEET DATE

There were no major events after the balance sheet date of 31 May 2016 that should be reported.

EMPLOYEE STRUCTURE ACCORDING TO AREASin ful l- t ime employees for 9M 2015/2016 in comparison to 9M 2014/2015

117 (PREVIOUS YEAR: 127) CONSULTING

48 (PREVIOUS YEAR: 46) ADMINISTRATION

108 (PREVIOUS YEAR: 105) CREATION

164 (PREVIOUS YEAR: 167) TECHNOLOGY

437 (PREVIOUS YEAR: 445)

INFORMATION WITHOUT NEXT AUDIENCE

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7 FORECAST

In the third quarter, SinnerSchrader continued its positive development of the first half of the current 2015/2016 financial

year. Revenue and earnings increased significantly compared to the two preceding quarters as well as to the same quarter

of the previous year.

On the basis of generally stable business with existing clients, the new clients won over the course of the past twelve

months ensured the organic revenue growth of the SinnerSchrader Group. Without taking account of NEXT AUDIENCE

business, revenue growth over the past nine months reached a rate of 17.5 %. A new-client rate just short of 14 % for the

nine-month period reflects a strong demand on the market and shows that SinnerSchrader does well when it comes to

asserting itself in pitch and purchasing processes.

This situation has been ongoing since the end of the reporting period and – as far as can currently be assessed – is

not affected by the British people’s Brexit vote. On the contrary, the fact that car manufacturer Audi has selected

SinnerSchrader as its new worldwide digital lead agency from a group of international bidders in a pitch and negotiation

process lasting six months underlines the positive business perspective for the Group. The revenue forecast of € 50.5

million for the current 2015/2016 financial year can thus be confirmed.

With respect to the realisable margin, however, the third quarter did not meet the original plan despite reaching an

EBITA margin of 10.5 % and as a result improving the operating result by 70 % and the margin by 3.2 percentage points

compared to the figures for the previous year. One reason for this is that SinnerSchrader faces a tightening personnel

market and has not been able to achieve its staffing plans. As a consequence, it was only possible to close the resulting

capacity gap by taking on more freelance staff. In addition, weak contribution margins from three projects that are being

steered following an agile process model and utilisation gaps due to certain resources having been held back during

prolonged negotiations with Audi in expectation of a positive decision prevented SinnerSchrader from meeting its margin

goals for the third quarter.

Expecting these issues to continue to compromise margins in the fourth quarter of 2015/2016, SinnerSchrader now fore-

casts operating results for the entire financial year at a level of € 4.5 million against the original outlook of € 5.0 million.

With an EBITA of € 4.5 million, the net profit will still come out at € 3.0 million.

Hamburg, 15 July 2015

The Management Board

Matthias Schrader Thomas Dyckhoff

16

0201 | INTERIM STATUS REPORT 3 2015/2016 05–16

02 | CONSOLIDATED QUARTERLY ACCOUNTS 3 2015/2016 18–33

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CONSOLIDATED BALANCE SHEETSAS AT 31 MAY 2016

Assets in € 31.05.2016 31.08.2015

Current assets:

Liquid funds 2,578,615 5,558,880

Cash and cash equivalents 2,578,615 5,558,880

Accounts receivable, net of allowances for doubtful accounts of € 45,550 and € 62,350 as at 31.05.2016 and 31.08.2015, respectively 8,151,701 10,325,660

Unbilled revenues 5,491,440 3,784,261

Tax receivables 22,816 22,838

Other current assets and prepaid expenses 687,584 696,172

Total current assets 16,932,156 20,387,811

Non-current assets:

Goodwill 4,820,937 4,820,937

Other intangible assets 111,702 177,682

Property and equipment 1,411,034 1,602,527

Tax receivables 46,171 68,649

Deferred tax assets 800,962 672,475

Total non-current assets 7,190,806 7,342,270

Total assets 24,122,962 27,730,081

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Liabilities and shareholders’ equity in € 31.05.2016 31.08.2015

Current liabilities:

Trade accounts payable 2,414,222 3,380,144

Advance payments received 710,062 1,985,738

Accrued expenses 3,324,239 3,063,446

Tax liabilities 1,057,686 1,575,196

Liabilities and other payables 1,273,309 2,470,842

Total current liabilities 8,779,518 12,475,366

Non-current liabilities:

Deferred tax liabilities 932,775 295,714

Total non-current liabilities 932,775 295,714

Shareholders’ equity:

Subscribed capital

Common stock, stated value € 1, issued: 11,542,764 and 11,542,764,

outstanding: 11,244,722 and 11,483,525 as at 31.05.2016 and 31.08.2015, respectively 11,542,764 11,542,764

Treasury stock, 298,042 and 59,239 as at 31.05.2016 and 31.08.2015, respectively –1,158,520 –103,802

Additional paid-in capital 3,846,406 3,926,544

Reserves for share-based compensation 289,482 266,598

Accumulated deficit (incl. revenue reserves) –136,506 –699,403

Changes in shareholders’ equity not affecting net income 27,043 26,300

Total shareholders’ equity 14,410,669 14,959,001

Total liabilities and shareholders’ equity 24,122,962 27,730,081

The accompanying notes are an integral part of these Consolidated Financial Statements.

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CONSOLIDATED STATEMENTS OF OPERATIONSFROM 1 SEPTEMBER 2015 TO 31 MAY 2016

in € Q3 2015/2016 Q3 2014/2015 9M 2015/2016 9M 2014/2015

Gross revenues 13,373,839 12,524,052 38,395,992 37,891,886

Media costs — –1,199,704 –228,191 –3,590,583

Total revenues, net 13,373,839 11,324,348 38,167,801 34,301,303

Cost of revenues –10,182,658 –8,312,166 –29,339,923 –26,402,946

Gross profit 3,191,181 3,012,182 8,827,878 7,898,357

Selling and marketing expenses –707,237 –872,866 –2,131,208 –2,976,235

General and administrative expenses –953,132 –1,058,309 –3,737,192 –3,539,621

Research and development expenses –164,505 –259,052 –341,884 –737,008

Other income and expenses, net 37,021 3,490 135,729 265,801

Operating income 1,403,328 825,445 2,753,323 911,294

Financial income 422 620 1,356 2,537

Financial expenses –1,789 –325 –2,292 –3,902

Income before provision for income tax 1,401,961 825,740 2,752,387 909,929

Income tax –425,439 –398,966 –828,462 –501,679

Net income 976,522 426,774 1,923,925 408,250

Net income attributable to the shareholders of Sinner Schrader AG 976,522 426,774 1,923,925 408,250

Net income per share (basic) 0.09 0.04 0.17 0.04

Net income per share (diluted) 0.09 0.04 0.17 0.04

Weighted average shares outstanding (basic) 11,374,244 11,327,525 11,387,635 11,272,803

Weighted average shares outstanding (diluted) 11,472,213 11,435,727 11,487,311 11,399,793


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CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOMEFROM 1 SEPTEMBER 2015 TO 31 MAY 2016

in € Q3 2015/2016 Q3 2014/2015 9M 2015/2016 9M 2014/2015

Net income 976,522 426,775 1,923,925 408,250

Other comprehensive income

Items that may be reclassified to profit or loss in future periods

Foreign currency translation adjustment –2 –1 743 633

Taxes on income recognised directly in shareholders’ equity — — — —

Changes in shareholders’ equity not affecting net income –2 –1 743 633

Consolidated comprehensive income 976,520 426,774 1,924,668 408,883

Comprehensive income attributable to the shareholders of Sinner Schrader AG 976,520 426,774 1,924,668 408,883


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CONSOLIDATED STATEMENTS OF SHAREHOLDERS’ EQUITYFROM 1 SEPTEMBER 2015 TO 31 MAY 2016

in € NUMBER OF SHARES OUTSTANDING

COMMON STOCK

TREASURY STOCK

ADDITIONAL PAID-IN CAPITAL

RESERVES FOR SHARE-BASED COMPENSATION

RETAINED EARNINGS/LOSSES

OTHER COMPREHENSIVE INCOME

TOTAL SHAREHOLDERS’ EQUITY

Balance as at 31.08.2014 11,235,858 11,542,764 –537,778 3,654,636 260,077 –869,487 25,162 14,075,374

Comprehensive income — — — — — 408,250 633 408,883

Disbursed dividend — — — — — –1,348,303 — –1,348,303

Deferred compensation — — — — 4,684 — — 4,684

Re-issuance of treasury stock 91,667 — 160,624 –8,540 — — — 152,084

Balance as at 31.05.2015 11,327,525 11,542,764 –377,154 3,646,096 264,761 –1,809,540 25,795 13,292,722

Balance as at 31.08.2015 11,483,525 11,542,764 –103,802 3,926,544 266,598 –699,403 26,300 14,959,001

Comprehensive income — — — — — 1,923,925 743 1,924,668



Purchase of treasury stock –288,803 — –1,230,356 — — — — –1,230,356


Balance as at 31.05.2016 11,244,722 11,542,764 –1,158,520 3,846,406 289,482 –136,506 27,043 14,410,669


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CONSOLIDATED STATEMENTS OF SHAREHOLDERS’ EQUITYFROM 1 SEPTEMBER 2015 TO 31 MAY 2016

in € NUMBER OF SHARES OUTSTANDING

COMMON STOCK

TREASURY STOCK

ADDITIONAL PAID-IN CAPITAL

RESERVES FOR SHARE-BASED COMPENSATION

RETAINED EARNINGS/LOSSES

OTHER COMPREHENSIVE INCOME

TOTAL SHAREHOLDERS’ EQUITY

Balance as at 31.08.2014 11,235,858 11,542,764 –537,778 3,654,636 260,077 –869,487 25,162 14,075,374

Comprehensive income — — — — — 408,250 633 408,883




Balance as at 31.05.2015 11,327,525 11,542,764 –377,154 3,646,096 264,761 –1,809,540 25,795 13,292,722

Balance as at 31.08.2015 11,483,525 11,542,764 –103,802 3,926,544 266,598 –699,403 26,300 14,959,001

Comprehensive income — — — — — 1,923,925 743 1,924,668



Purchase of treasury stock –288,803 — –1,230,356 — — — — –1,230,356


Balance as at 31.05.2016 11,244,722 11,542,764 –1,158,520 3,846,406 289,482 –136,506 27,043 14,410,669


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CONSOLIDATED STATEMENTS OF CASH FLOWSfrom 1 September 2015 to 31 May 2016

in € 9M 2015/2016 9M 2014/2015

Cash flows from operating activities:

Net income 1,923,925 408,250

Adjustments to reconcile net income to net cash used in operating activities:

Depreciation of property and equipment 548,385 854,301

Share-based compensation 22,884 4,684

Bad debt expenses –6,600 —

Gains/losses on the disposal of fixed assets 2,828 4,622

Deferred tax provision 508,574 –64,000

Changes in assets and liabilities:

Accounts receivable 2,180,559 1,865,344

Unbilled revenues –1,707,179 –145,857

Tax receivables 22,500 –186,406

Other current assets 8,588 365,090

Accounts payable, deferred revenues and other liabilities –3,439,131 –1,683,119

Tax liabilities –517,510 294,553

Other accrued expenses 260,793 –1,680,975

Net cash provided by (used in) operating activities –191,384 36,487

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in € 9M 2015/2016 9M 2014/2015

Cash flows from investing activities:

Purchase of property and equipment –316,048 –518,461

Proceeds from the sale of equipment 22,309 16,382

Net cash provided by (used in) investing activities –293,739 –502,079

Cash flows from financing activities:

Payment to shareholders –1,361,028 –1,348,303

Payment for treasury stock –1,230,356 —

Incoming payment for treasury stock 95,500 152,084

Net cash provided by (used in) financing activities –2,495,884 –1,196,219

Net effect of rate changes on cash and cash equivalents 742 633

Net increase/decrease in cash and cash equivalents –2,980,265 –1,661,178

Cash and cash equivalents at beginning of period 5,558,880 5,832,597

Cash and cash equivalents at end of period 2,578,615 4,171,419

For information only, contained in cash flows from operating activities:

Interest payment received 91 697

Paid interest –2,292 –3,902


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NOTES AS AT 31 MAY 2016

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1 GENERAL FOUNDATIONS

The Consolidated Interim Financial Statements as at 31 May 2016 of SinnerSchrader Aktiengesellschaft (“Sinner-

Schrader AG” or “AG”) and its subsidiaries (“SinnerSchrader Group”, “SinnerSchrader”, or “Group”) for the first nine

months and the third quarter of the 2015/2016 financial year from 1 September 2015 and 1 March 2016, respectively, to

31 May 2016 were prepared according to the International Financial Reporting Standards (“IFRS”) of the International

Accounting Standards Board (“IASB”) in force on the report date, taking account of the interpretations of the International

Financial Reporting Interpretations Committee (“IFRIC”) and in compliance with the standard for interim financial reports

specified by DRS 16 of the German Accounting Standards. They were not subject to auditing and should be read in con-

junction with the Consolidated Financial Statements of SinnerSchrader AG as at 31 August 2015.

The accounting, valuation, and consolidation principles of the Quarterly Report at hand are unchanged from the Group’s

Consolidated Financial Statements as at 31 August 2015. They are disclosed and explained in the Group’s Consolidated

Financial Statements as at 31 August 2015, which are published in the 2014/2015 Annual Report.

2 CONSOLIDATION GROUP

The consolidation group as at 31 May 2016 consists of SinnerSchrader AG as well as the following direct and indirect

subsidiaries of the AG, each of which is fully consolidated:

1. SinnerSchrader Deutschland GmbH, Hamburg, Germany

2. Commerce Plus GmbH, Hamburg, Germany

3. Commerce Plus Consulting GmbH, Hamburg, Germany

4. NEXT AUDIENCE GmbH, Hamburg, Germany

5. SinnerSchrader Content GmbH, Hamburg, Germany

6. SinnerSchrader Mobile GmbH, Berlin, Germany

7. Swipe GmbH, Hamburg, Germany

8. SinnerSchrader Praha s.r.o., Prague, Czech Republic

9. SinnerSchrader UK Ltd., London, UK

10. SinnerSchrader Benelux BV, Rotterdam, the Netherlands

The consolidation group has not changed in comparison to the status on 31 August 2015.

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3 SEGMENT REPORTING

SinnerSchrader still breaks down its business into the three segments Interactive Marketing, Interactive Media, and

Interactive Commerce.

SinnerSchrader Deutschland GmbH, SinnerSchrader Praha s.r.o., SinnerSchrader Mobile GmbH and Swipe GmbH are

brought together in the Interactive Marketing segment.

The Interactive Media segment comprises NEXT AUDIENCE GmbH and its full subsidiary SinnerSchrader Content GmbH.

The Commerce Plus Group forms the Interactive Commerce segment.

Accounting for the individual segments follows the accounting principles that are also used in the Group. Administrative

costs incurred in SinnerSchrader AG are charged to the operative segments, where they can be assigned. Costs that

cannot be assigned are not distributed to the segments – these are largely costs for original holding tasks, such as

investor relations work.

Table 1a shows the segment information for the first nine months of the 2015/2016 financial year; the comparative data

of the previous year can be seen in Table 1b:

Table 1a Segment information for the f irst nine months 2015/2016 in € and number

01.09.2015–31.05.2016 INTERACTIVE MARKETING

INTERACTIVE MEDIA


TOTALSEGMENTS

HOLDING/CONSOLIDATION

GROUP

External revenues 29,400,946 3,060,073 5,934,973 38,395,992 — 38,395,992

Internal revenues 544,299 91,236 117,475 753,010 –753,010 —

Gross revenues 29,945,245 3,151,309 6,052,448 39,149,002 –753,010 38,395,992

Media costs — –228,191 — –228,191 — –228,191

Total revenues, net 29,945,245 2,923,118 6,052,448 38,920,811 –753,010 38,167,801

Segment income (EBITA) 2,777,143 208,436 317,043 3,302,622 –549,299 2,753,323

Employees, end of period 343 20 84 447 47 494

In the Interactive Marketing segment, net revenue in the amount of € 6,222,000 and € 5,918,000, respectively, was

achieved with two groups of companies in the first nine months of the financial year, accounting for 16.3 % and 15.5 %,

respectively, of the consolidated net revenue for the Group.

Table 1b Segment information for the f irst nine months 2014/2015 in € and number

01.09.2014–31.05.2015 INTERACTIVE MARKETING

INTERACTIVE MEDIA


TOTALSEGMENTS

HOLDING/CONSOLIDATION

GROUP

External revenues 24,593,391 7,694,256 5,604,239 37,891,886 — 37,891,886

Internal revenues 347,894 52,023 139,053 538,970 –538,970 —

Gross revenues 24,941,285 7,746,279 5,743,292 38,430,856 –538,970 37,891,886

Media costs — –3,590,583 — –3,590,583 — –3,590,583

Total revenues, net 24,941,285 4,155,696 5,743,292 34,840,273 –538,970 34,301,303

Segment income (EBITA) 1,833,507 –305,452 155,440 1,683,495 –772,202 911,294

Employees, end of period 332 50 87 469 45 514

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Table 1c explains the transfer of the total segment income to Group income before taxes for the period from

1 September 2015 to 31 May 2016 and for the comparable period of the previous year:

Table 1c Reconcil iat ion of segment income to Group income before taxes in €

9M 2015/2016 9M 2014/2015

Segment income (EBITA) all reporting segments 3,302,622 1,683,495

Central costs not passed on to segments –549,299 –772,202

EBITA of the Group 2,753,323 911,294

Group financial income –936 –1,365

Group income before taxes 2,752,387 909,929

All of SinnerSchrader’s external revenues were earned by Group companies based in Germany.

4 BREAKDOWN OF EXPENSES ACCORDING TO THE TOTAL COST METHOD

The total revenues, marketing, administrative, and research and development costs in the first nine months of the

2015/2016 and 2014/2015 financial years were broken down according to cost types, as shown in Table 2:

Table 2 Operat ing costs by cost type in €

9M 2015/2016 9M 2014/2015

Personnel expenses 22,736,027 23,061,921

Costs of materials and services 7,333,862 5,415,511

Depreciation of property and equipment, as far as not from first consolidation 548,385 854,301

Other operating expenses 4,931,933 4,324,077

Total 35,550,207 33,655,810

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5 INCOME TAX

The income tax reported in the Statements of Operations is made up of current and deferred components, as shown

in Table 3:

Table 3 Income Tax in €

9M 2015/2016 9M 2014/2015

Current 319,888 565,679

Deferred 508,574 –64,000

Total 828,462 501,679

In the first nine months of the 2015/2016 financial year, current taxes in the amount of € 320,000 (previous year:

€ 566,000) were incurred. Deferred taxes were to be formed in recognition of profit and loss according to IAS 12 due

to temporary differences between the book values in the Consolidated Balance Sheets and the tax assumptions.

This resulted in tax expenditure in the amount of € 508,000 in the period of the report; in the comparable period of the

previous year, deferred tax income in the amount of € 64,000 was posted.

6 FINANCIAL OBLIGATIONS AND CONTINGENT LIABILITIES

The contingencies and other financial obligations as at 31 May 2016 were largely unchanged compared to the

Consolidated Financial Statements as at 31 August 2015.

7 TREASURY STOCK

As at 31 May 2016, the treasury stock of SinnerSchrader AG amounted to 298,042 shares with a calculated face value

of € 298,042, representing 2.58 % of the share capital. On 31 August 2015 the number of shares of treasury stock

amounted to 59,239 shares with a calculated face value of € 59,239, or 0.51 % of the share capital.

In the first nine months of 2015/2016, 50,000 shares of treasury stock were issued in the context of the exercising of

employee options, and 288,803 shares of treasury stock were purchased at an average acquisition cost of € 4.26 per share.

The 298,042 shares of treasury stock as at 31 May 2016 were to be recognised at acquisition costs in an amount of

€ 1,158,520, or an average of € 3.89 per share.

8 STOCK OPTION PLANS

In January 2007, the Annual General Meeting of SinnerSchrader AG approved the 2007 SinnerSchrader Stock Option

Plan (“2007 Plan”), which provided by 31 December 2011 for the granting of share options to allocate a total of 600,000

shares to the members of the Management Board of SinnerSchrader AG and to the members of the management of

the affiliated companies as well as to selected employees performing managerial tasks within SinnerSchrader AG and

affiliated companies.

In a resolution of 20 December 2012, the Annual General Meeting of SinnerSchrader AG adopted the 2012 SinnerSchrader

Stock Option Plan (“2012 Plan”) to grant share options for the sale of a total of 550,000 shares to members of the Manage-

ment Board of SinnerSchrader AG (100,000 options) and members of the management of the companies affiliated with

SinnerSchrader AG (300,000 options) as well as selected employees with management functions in SinnerSchrader AG

and the companies affiliated with SinnerSchrader AG (150,000 options).

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Detailed information on the 2007 and 2012 Stock Option Plans can be found in the Notes to the Consolidated Financial

Statements as at 31 August 2015.

A total of 50,000 options from the 2007 Stock Option Plan with an average exercise price of € 1.91 were exercised in

the first nine months of the 2015/2016 financial year.

A total of 95,000 options from the 2012 Stock Option Plan with an average exercise price of € 3.48 were allocated in

the period of the report, and 25,000 options with an average exercise price of € 2.11 were to be cancelled.

Table 4a shows the parameters used to assess the newly allocated options in the first nine months of the 2015/2016

financial year on the basis of a binomial model according to Cox/Ross/Rubenstein:

Table 4a Parameters for valuat ion of stock opt ions at the date of issue

9M 2015/2016

Expected life of option 4.5 years

Risk-free interest rate 0.15 %

Expected dividend yield 5 %

Expected volatility 38 %

Exercise price € 3.48

Price at valuation date € 3.93

Table 4b summarises the changes in the number of options from the 2007 and 2012 Stock Option Plans outstanding in

the first nine months of the 2015/2016 financial year:

Table 4b Outstanding stock opt ions in € and number

NUMBER OF OPTIONS WEIGHTED AVERAGE EXERCISE PRICE

WEIGHTED AVERAGE GRANT DATE FAIR VALUE

Outstanding at 31 August 2015 283,333 2.14 0.41

Granted 95,000 3.48 0.95

Exercised –50,000 1.91 0.37

Cancelled –25,000 2.11 0.51

Expired — — —

Outstanding at 31 May 2016 303,333 2.60 0.58

As at 31 May 2016, 78,333 employee options from the 2007 Stock Option Plan and 225,000 employee options from the

2012 Stock Option Plan with an average exercise price of € 2.30 and € 2.71, respectively, were thus still outstanding.

IFRS 2 prescribes income-affecting entry in the balance sheet of costs resulting from the issue of employee options on

the basis of the current value. The market value of the options on the issue date should be distributed over the waiting

period for exercising the option and then proportionately entered in the Statements of Operations as personnel costs

for the relevant period. The costs are recorded against the shareholders’ equity in the reserve for share-based compen-

sation. In the first nine months of the 2015/2016 financial year, the costs to be taken into account amounted to € 22,884,

compared to € 4,684 in the comparable period of 2014/2015.

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9 RELATED PARTY TRANSACTIONS

In the first nine months of the 2015/2016 and 2014/2015 financial years, SinnerSchrader earned gross revenues in the

amount of € 773,878 and € 1,522,852, respectively, with companies in which members of the SinnerSchrader Supervisory

Board held positions relevant to decision-making.

10 MAJOR EVENTS AFTER THE BALANCE SHEET DATE

There were no major events after the balance sheet date that should be reported.

11 DIRECTORS’ HOLDINGS OF SHARES AND SUBSCRIPTION RIGHTS TO SHARES (“DIRECTOR’S DEALINGS”)

Table 5 shows the number of shares and subscription rights to shares of SinnerSchrader AG held by Board members of

SinnerSchrader AG as at 31 May 2016 and their changes in the first nine months of the 2015/2016 financial year:

Table 5 Shares and options of the Board members in number

SHARES 31.08.2015 ADDITIONS DISPOSALS 31.05.2016

Management Board:

Matthias Schrader 2,576,289 12,110 — 2,588,399

Thomas Dyckhoff 109,950 — — 109,950

Total shares of the Management Board 2,686,239 12,110 — 2,698,349

Supervisory Board:

Dieter Heyde — — — —

Prof. Cyrus D. Khazaeli — — — —

Philip W. Seitz — — — —

Total shares of the Supervisory Board — — — —

Total shares of the Board members 2,686,239 12,110 — 2,698,349

OPTIONS 31.08.2015 ADDITIONS DISPOSALS 31.05.2016 CURRENT VALUE OF EACH

SUBSCRIPTION RIGHT ON THE

DATE OF GRANTING

Management Board:

Matthias Schrader — — — —

Thomas Dyckhoff 45,000 — — 45,000 € 0.48

Total options of the Management Board 45,000 — — 45,000

Supervisory Board:

Dieter Heyde — — — —

Prof. Cyrus D. Khazaeli — — — —

Philip W. Seitz — — — —

Total options of the Supervisory Board — — — —

Total options of the Board members 45,000 — — 45,000

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RESPONSIBILITY STATEMENT

To the best of our knowledge, and in accordance with the applicable reporting principles, the Quarterly Financial Report of the

SinnerSchrader Group gives a true and fair view of the asset, financial, and income situation of the Group, and the Interim Status

Report includes a fair review of the development and performance of the business and the position of the Group, together with

a description of the principal opportunities and risks associated with the expected development of the Group.

Hamburg, 15 July 2016

The Management Board

Matthias Schrader Thomas Dyckhoff

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EVENTS & CONTACT INFORMATION

Financial Calendar 2015/2016

Announcement of preliminary figures for the 2015/2016 financial year October 2016

Annual Report 2015/2016 November 2016

Annual General Meeting 2015/2016 January 2017

Our previous reports are available online and for download on our website www.sinnerschrader.ag.

Contact

Sinner Schrader AG, Investor Relations

Völckersstraße 38, 22765 Hamburg, Germany

T. +49. 40. 39 88 55-0, F. +49. 40. 39 88 55-55

www.sinnerschrader.com, [email protected]

Editorial Information

Published by SinnerSchrader Aktiengesellschaft, Hamburg, Germany

Date of publication: 15 July 2016

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SINNER SCHRADER AKTIENGESELLSCHAFT VÖLCKERSSTRASSE 3822765 HAMBURGGERMANY

WWW.SINNERSCHRADER.COM

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