Embed Size (px)
Citation preview
Non-authorative English translation of Indepent Auditor's Report ATEGE Allgemeine Transportge-sellschaft vorm. Gondrand 8r. Mangili mbH, Frankfurt am Main from January 1 to December 31,
2016 1
Auditor's Report
We have audited the annual financial statements, comprising the balance sheet, the income state-
ment and the notes to the financial statements, together with the bookkeeping system, and the
management report of the ATEGE Allgemeine Transportgesellschaft vorm. Gondrand 8z Mangili
mbH, Frankfurt am Main, for the business year from January 1 to December 31, 2016. The mainte-
nance of the books and records and the preparation of the annual financial statements and man-
agement report in accordance with German commercial law are the responsibility of the Com-
pany's Managing Directors. Our responsibility is to express an opinion on the annual financial
statements, together with the bool(keeping system, and the management report based on our au-
dit.
We conducted our audit of the annual financial statements in accordance with § (Article) 317 HGB
("Handelsgesetzbuch": "German Commercial Code") and German generally accepted standards for
the audit of financial statements promulgated by the Institut der Wirtschaftspriifer (Institute of
Public Auditors in Germany) (IDW). Those standards require that we plan and perform the audit
such that misstatements materially affecting the presentation of the net assets, financial position
and results of operations in the annual financial statements in accordance with (German) princi-
ples of proper accounting and in the management report are detected with reasonable assurance.
Knowledge of the business activities and the economic and legal environment of the Company and
expectations as to possible misstatements are taken into account in the determination of audit pro-
cedures. The effectiveness of the accounting-related internal control system and the evidence sup-
porting the disclosures in the books and records, the annual financial statements and the manage-
ment report are examined primarily on a test basis within the framework of the audit. The audit
includes assessing the accounting principles used and significant estimates made by the Company's
Managing Directors, as well as evaluating the overall presentation of the annual financial state-
ments and management report. We believe that our audit provides a reasonable basis for our opin-
ion.
1
Non-authorative English translation of Indepent Auditor's Report ATEGE Allgemeine Transportge-sellschaft vorm. Gondrand & Mangili mbH, Frankfurt am Main from January 1 to December 31,
2016 2
Our audit has not led to any reservations.
In our opinion based on the findings of our audit, the annual financial statements comply with the
legal requirements and give a true and fair view of the net assets, financial position and results of
operations of the Company in accordance with (German) principles of proper accounting. The
management report is consistent with the annual financial statements, complies with legal require-
ments, as a whole provides a suitable view of the Company's position and suitably presents the op-
portunities and risks of future development.
Frankfurt am Main, March 20, 2017
PricewaterhouseCoopers GmbH
Wirtschaftspriifungsgesellschaft
Nadia Brieder-Markl ppa. Oliver Fliess
WirtschaftsprUfer Wirtschaftsprilfer
(German Public Auditor) (German Public Auditor)
2
Appendix II 5
ATEGE Allgemeine Transportgesellschaft vorm. Gondrand & Mangili mbH, Frankfurt am Main
Income Statement for the Financial Year from January 1 through December 31, 2016
2016 2015
€ € 1. Sales revenues 103.145.959,49 107.971.318,79 2. Other operating income
(of which income from currency translation € 257,416.44; prior year € 386,812.73)
1.673.354,24 1.411.412,43
104.819.313,73 109.382.731,22 3. Cost of materials
Expenses for purchased services -80.801.769,43 -84.710.990,29 4. Personnel expenses
a) Wages and salaries b) Social security contributions, pensions
and other benefits (of which pensions € 524,419.66; prior year € 160,584.05)
-12.539.969,25
-2.963.815,13
-13.579.970,52
-2.756.187,07
-15.503.784,38 -16.336.157,59 5. Amortization/depreciation on fixed intangible
and tangible assets -265.471,10 -302.754,94 6. Other operating expenses
(of which expenses from currency translation € 333,303.96; prior year € 523,566.95)
-9.353.953,59 -11.458.957,59
7. Net operating expenses -1.105.664,77 -3.426.129,19 8. Income from other long-term equity investments 66.980,76 75.875,03 9. Other interest and similar income
(of which from affiliated companies € 46,822.00; prior year € 63,027.00)
49.097,72 72.989,77
10. Interest and similar expenses (of which to affiliated companies € 8,035.00; prior year € 0.00) (of which expenses from compounding € 546,968.00; prior year € 580,872.00)
-587.540,36 -615.687,49
11. Taxes on income -180.202,71 234.066,65 12. Loss after taxes -1.757.329,36 -3.658.885,23 13. Other taxes -55.409,33 -65.905,59 14. Net loss for the year -1.812.738,69 -3.724.790,82 15. Simplified capital decrease of subscribed capital 0,00 3.480.950,00 16. Withdrawal from capital reserve 0,00 174.048,00 17. Withdrawal from revenue reserves 0,00 174.048,00 18. Cumulative losses brought forward -2.723.815,27 -2.828.070,45 19. Total net loss -4.536.553,96 -2.723.815,27
Appendix II 2
ATEGE Allgemeine Transportgesellschaft vorm. Gondrand & Mangili mbH, Frankfurt am Main
Balance Sheet as of December 31, 2016
Assets
12/31/2016 12/31/2015
€ € A. Fixed assets
I.Intangible assets 1. Acquired IT programs
179.699,98 205.152,76
II. Tangible assets
1. Land, similar rights and buildings including buildings on leasehold land 3.447.279,30 3.558.060,23
2. Technical equipment and machinery 11.796,05 12.381,61 3. Other equipment, factory and office equipment 249.458,99 309.309,81
3.708.534,34 3.879.751,65 Ill. Financial assets
1.Shares in affiliated companies 31.392,83 57.253,97 2. Loans to affiliated companies 1.908.390,72 2.508.390,72 3. Other long-term equity investments 44.482,90 44.482,90
1.984.266,45 2.610.127,59
5.872.500,77 6.695.032,00 B. Current assets
I.Inventories
Raw materials and supplies 22.273,45 22.273,45
II.Receivables and other assets 1.Trade receivables 15.114.589,47 15.534.492,88 2. Receivables from affiliated companies 847.986,10 905.907,55 3. Other assets 558.532,21 767.182,03
16.521.107,78 17.207.582,46 Ill. Securities
Other securities 0,00 178.624,29
IV. Cash on hand, bank balances and checks 5.623.184,37 5.377.162,92
22.166.565,60 22.785.643,12 C. Prepaid expenses and deferred charges 67.718,18 55.518,92 D. Deficit not covered by equity 3.436.553,96 1.623.815,27
31.543.338,51 31.160.009,31
Appendix II 3
Shareholder's Equity and Liabilities
12/31/2016 12/31/2015
€ € A. Shareholder's equity
I.Subscribed capital 1.000.000,00 1.000.000,00 II. Capital reserve 50.000,00 50.000,00 III. Revenue reserves 50.000,00 50.000,00 IV. Net debt -4.536.553,96 -2.723.815,27
Net debt to the extent covered by equity: € 0.00; prior year: €
1,000,975.55
VII. Deficit not covered by equity 3.436.553,96 1.623.815,27
0,00 0,00 B. Provisions
1. Provisions for pensions and similar obligations 11.358.990,89 10.935.543,62 2. Tax provisions 0,00 4.000,00 3. Other provisions 3.298.580,42 3.276.147,80
14.657.571,31 14.215.691,42 C. Liabilities
1. Trade payables (of which with a residual term of up to one year € 7,788,210.52; prior year € 9,927,455.18)
7.788.210,52 9.927.455,18
2. Payables to affiliated companies (of which with a residual term of up to one year € 2,549,008.06; prior year € 2,385,930.59)
4.549.008,06 2.385.930,59
3. Other liabilities (of which with a residual term of up to one year € 4,516,466.62; prior year € 4,630,932.12) (of which customs duty and turnover tax on imports € 3,890,850.57; prior year € 3,802,911.49) (of which wage taxes € 170,967.56; prior year € 163,698.47)
4.548.548,62 4.630.932,12
16.885.767,20 16.944.317,89
31.543.338,51 31.160.009,31
Appendix II
ATEGE Allgemeine Transportgesellschaft vorm. Gondrand & Mangili mbH
Fixed-Asset Movement Schedule for the Financial Year from January 1 through December 31, 2016
Cost 1/1/2016 Additions Disposals 12/31/2016
€ € € €
I. Intangible assets 1. Acquired IT programs 1.351.427,42 47.142,78 10.441,75 1.388.128,45
1.351.427,42 47.142,78 10.441,75 1.388.128,45 II. Tangible assets
1. Land, similar rights and buildings including buildings on leasehold land 10.186.797,67 0,00 0,00 10.186.797,67
2. Technical equiment and machinery 343.112,07 3.709,65 129.176,81 217.644,91 3. Other equipment, factory and office equipment 2.416.508,90 23.317,75 80.554,81 2.359.271,84
12.946.418,64 27.027,40 209.731,62 12.763.714,42 III. Financial assets
1. Shares in affiliated companies 153.172,82 0,00 25.861,14 127.311,68 2. Loans to affiliated companies 2.573.390,72 0,00 600.000,00 1.973.390,72 3. Other long-term equity investments 121.176,70 0,00 0,00 121.176,70
2.847.740,24 0,00 625.861,14 2.221.879,10
17.145.586,30 74.170,18 846.034,51 16.373.721,97
Appendix II
Amortization/depreciation Residual book values 1/1/2016 Additions Disposals 12/31/2016 12/31/2016 12/31/2015
€ € € € € €
1.146.274,66 72.595,56 10.441,75 1.208.428,47 179.699,98 205.152,76 1.146.274,66 72.595,56 10.441,75 1.208.428,47 179.699,98 205.152,76
6.628.737,44 110.780,93 0,00 6.739.518,37 3.447.279,30 3.558.060,23 330.730,46 3.583,11 128.464,71 205.848,86 11.796,05 12.381,61
2.107.199,09 78.511,50 75.897,74 2.109.812,85 249.458,99 309.309,81 9.066.666,99 192.875,54 204.362,45 9.055.180,08 3.708.534,34 3.879.751,65
95.918,85 0,00 0,00 95.918,85 31.392,83 57.253,97 65.000,00 0,00 0,00 65.000,00 1.908.390,72 2.508.390,72 76.693,80 0,00 0,00 76.693,80 44.482,90 44.482,90
237.612,65 0,00 0,00 237.612,65 1.984.266,45 2.610.127,59 10.450.554,30 265.471,10 214.804,20 10.501.221,20 5.872.500,77 6.695.032,00
Appendix I
1
MANAGEMENT REPORT for Financial Year 2016
of
ATEGE ALLGEMEINE TRANSPORTGESELLSCHAFT
VORM. GONDRAND & MANGILI MBH, FRANKFURT/MAIN
I. Business Model
Organisational Structure of the Company
Gondrand Holding AG with its registered head office in Basel (Switzerland) is the sole share-
holder of ATEGE Allgemeine Transportgesellschaft (formerly Gondrand & Mangili GmbH),
hereinafter referred to as "ATEGE". The Company is included in the consolidated financial
statements of the Gondrand Group. In financial year 2016, the Company maintained depend-
ent branches at 16 locations. The headquarters are located in Frankfurt am Main.
Products and markets
ATEGE's operating activities focus on a broad range of forwarding services of all kinds, in par-
ticular the procurement of transport, as well as the execution of warehousing, logistics, and
distribution dealings. The service range of ATEGE comprises the areas of road transport, air
and sea freight, logistics, and other services.
The Company primarily serves customers in the following segments: Automotive, Chemicals,
Technology, Pharma/Healthcare, and Consumer/Retail. ATEGE attaches great importance to
creating and offering its customers customised solutions tailored to their needs along the en-
tire value-added chain. Our long-standing customer relationships are founded on this linking
between the supplier, customer, and service provider.
II. Economic Report
1. Macroeconomic and Sector-Specific Conditions
Compared with the prior year, global economic growth only decreased slightly in 2016; the
growth rate was 3.1%'. There were demand-related indications of an increase especially in
the second half of the year and particularly in the USA, Japan, Spain, and Germany. Emerging
and developing countries reported varying growth rates. While China continues to generate
high economic growth, India and Brazil saw decreased activity. Geopolitical factors prevented
stronger growth, especially in the Middle East and Turkey.
The real gross domestic product rose by 1.7%' in the euro area and by 2.0%1- within the Euro-
pean Community, whereby the growth differential remained in place within the European
monetary union. This growth was spurred by increased global investing activities, infrastruc-
ture measures in China, and favourable financing conditions.
i International Monetary Fund: World Economic Outlook (WEO) April 2017
Appendix I 2
The key markets for ATEGE, in particular for its air freight and sea freight activities, comprise the
following countries and regions (values expressed in C million)2:
2015 Exports3 2016 Exports
(€ million) (C million)
EU countries 692,493 707,692
Asia (including China, Japan & India) 196,297 200,459
Europe (excluding the EU) 110,913 113,531
China 71,284 76,109
United States 113,733 106,919
Brazil 9,865 8,548
India 9,734 9,801
South Africa 9,626 8,810
Australia & Oceania 10,221 10,381
2015 Imports 2016 Imports
(C million) (C million)
EU countries 543,334 552,431
Asia (including China, Japan & India) 188,621 193,292
Europe (excluding the EU) 110,448 106,055
China 91,930 93,757
United States 60,217 57,823
Brazil 8,418 7,841
India 7,584 7,616
South Africa 5,902 6,199
Australia & Oceania 2,951 2,990
In 2016 the German economy was characterised by sound and constant economic growth.
Compared with the prior year, the price-adjusted gross domestic product (GDP) changed by
1.9%4. In turn, private and public consumer spending were key drivers. Investments in
equipment increased more cautiously. Due to price factors, imports grew faster than exports,
which meant that the net exports slightly dampened German GDP growth.
In 2016, transport volumes in freight transport reached another new maximum which was 1.1%5 higher than in the prior year. The distribution among the areas relevant to ATEGE was
as follows: road transport (+1.5%)5, sea freight (+0.3%)5, air freight (+3.3%)5.
2 DESTATIS German Federal Statistical Office: Order of the trade partners for foreign trade of the Federal Republic of Germany 2016,
Wiesbaden April 12, 2017
3 Deviations to ATEGE's prior year's report anse from the subsequent correction of the German Federal Statistical Office in 2016.
4 DESTATIS German Federal Statistical Office: 2016 gross domestic product, press conference of the German Federal Statistical Office,
Wiesbaden January 12, 2016
DESTATIS German Federal Statistical Office: 2016 freight transport in Germany, press release dated February 17, 2017 - 57/17, February
17, 2017
Appendix I 3
2. Sales and procurement policies
ATEGE has a global network of agents, partners and its own branches at its disposal which
can be used to process the sale of all transport services worldwide.
With regard to air freight, ATEGE capitalises on the leading carriers at the economically rele-
vant airports in Germany and at the destination to manage all of the logistics processes.
Procurement in the areas of sea freight and road transport primarily relates to placing orders
with shipping companies and other subcontractors.
3. Human resources and social issues
At the end of the year, 332 people were employed (excluding those engaging in minor em-
ployment). Of this number, there were 211 salaried employees, 70 wage earners, and 51
trainees. There were 24 part-time employees at the end of the year.
The average age of employees (not including trainings) was 42.6 years old in the reporting
year. Approximately 45 percent of the staff were in the age range from 30 to 49 years old, 26
percent of employees were 50 and older, and 29 percent were younger professionals.
The percentage of women in the Company was 39 percent.
ATEGE ternninated its membership in the cargo network of System Alliance GmbH, Niederau-
la, at its Frankfurt am Main location effective December 31, 2016. In addition, the business
segment for exhibition logistics at the Frankfurt location was sold to Sempex Deutschland
GmbH as part of an asset deal. Both of these measures led to a reduction in ATEGE staffing
leveis and eliminated eight jobs during the period under review.
4. Quality management, environmental protection
ATEGE is an authorised economic operator (AEO). This status is granted to parties which have
been approved as complying with supply chain security standards along the supply chain
from the manufacturer of a good to the consumer. In this context, the global recognition of
the AEO status is required. The authorised economic operators are granted various forms of
relief for security-related controls. It is recognised by countries which have signed the rele-
vant agreement with the Federal Republic of Germany. The Company has been certified as
"AEOF - (Customs simplifications/Security and safety)" since November 20, 2010. The status
of authorised economic operator is valid in all member states and not subjected to a time
limit. In 2016, no serious violations to the valid guidelines were detected by customs authori-
ties, which act as a supervisory authority. Minor deviations were resolved in a timely manner.
The data was updated and provided to customs authorities, and this status was confirmed in
December.
With regard to aviation security, internal audits were conducted at all the locations in 2016.
The German Federal Aviation Authority did not find any deviations from the regulations.
ATEGE agreed on objectives for 2016 to ensure it complies with a high standard of quality
(QM/EM) for rendering our services. The OM system is reviewed to ensure the central stand-
ards are being complied with at the branches at least once a year by means of internal audits.
This is usually monitored by a service provider which has a neutral perspective of the system.
In 2016, the QM and EM system (certificate) were monitored by means of an external audit
conducted by TOV Nord at four different locations. Within the course of this external audit,
the certified party was able to verify ATEGE's full compliance in line with DIN ISO 9001: 2008
and DIN ISO 14001: 2009 for all of the locations which were visited.
Appendix I 4
All occupational safety events in 2016 were reported in a timely manner and resolved, and
the processes and directions were improved accordingly.
No environmental incidents were reported in 2016.
5. Financing
The Company is financed both through current cash flow and a loan from Gondrand Holding
AG in the amount of Te 2,000, which has a term until December 31, 2019. This loan was pro-
vided in April 2016 to strengthen its self-financing and realise key strategic projects. The
Company has various bank accounts denoted in euros and foreign currencies (USD, CHF). As
of the balance sheet date, the credit amounted to T€ 5,623 (prior year: 5,377). In order to
hedge bank guarantees relating to customs and rental guarantees, there are term deposit ac-
counts in the amount of T€ 2,546 (prior year: T€ 2,545).
6. Investments
In financial year 2016, investments in the amount of T€ 74 were made to fixed assets. Of this,
T€ 47 related to software and T€ 27 related to factory and office equipment.
7. Important events in the financial year
The management team of the Gondrand Group, which was established in the previous year,
took up its work in the ATEGE Supervisory Board with Julien Houart (Chairman of the Board)
and Anthony Ranson (CEO Gondrand Group) and proceeded with the personnel and strategic
restructuring of the Group in collaboration with the Managing Director of ATEGE, Marco
Salzmann.
Within the framework of the consolidation efforts of the Gondrand Group, ATEGE
sold its exhibition segment at its Frankfurt am Main location to Sempex Deutschland
GmbH, Frankfurt as of October 1, 2016. This resulted in accounting profits of T€ 54 in
the reporting year. Moreover, the wholly-owned ATEGE subsidiary KT Kombi-
Trucking GmbH located in Frankfurt am Main was merged with the parent company
within the course of an upstream merger.
The measures rolied out in the year before were continued in 2016, and supplemented with
further suitable activities:
• Consolidation of the organisational and management structure of ATEGE
• Closer collaboration of the location in the air and sea freight field
• Redetermination of the contractual basis for key agents in air and sea freight
• Continuation of the sales activities in the field of defined target customers
• Further restructuring in the field of road transport
ATEGE's membership in the System Alliance cooperation, which was begun on August 17,
2015 by the Frankfurt location, did not provide the desired stability and profitability to the
road transport segment throughout 2016. Accordingly, the membership in the cooperation
was terminated as of December 31, 2016, and the corresponding additional resources were
subsequently dismantled.
8. Analysis of the business trends and business fields
Appendix I
5
ATEGE is a member of Gondrand Holding AG and is included in its consolidated financial
statements pursuant to Swiss GAAP. The planning, management, and controlling of the Com-
pany and the derivation of financial and non-financial key performance indicators are provi-
sion is on the basis of monthly and annual financial statements which are recognised as Swiss
GAAP FER values according to the Group's accounting guidelines. However, these results de-
viate only slightly from the HGB values. The ORI, which reflects EBIT before intercompany al-
locations, is the key indicator.
For financial year 2016, the Company planned to see operating results ORI of T€ 3,202. How-
ever, the ORI result achieved in the reporting year amounted to T€ 1,267, which did not meet
expectations. However, compared to the prior year (TC-476), this represented a considerable
improvement. This was caused by a sales revenue decrease which corresponded to 4.5%
compared to the prior year. It was initially possible to reduce this somewhat through the ex-
penses for purchased services falling by 4.6%. Therefore, gross profit of T€ 22,311 was rec-
ognised, which was only 4.0% lower than in 2015. In particular, personnel expenses fell by
5.1% while other operating expenses declined by 16.9%. Primarily as a result of these de-
creases, costs were cut significantly compared to the prior year since no comparable special
influences occurred. Restructuring expenses fell only in the amount of T€ 122 (prior year:
T€ 250). Intercompany allocations of T€ 2,397 were reported, which was below the previous
year's level of T€ 2,872. Income tax and other tax reimbursement claims fell and therefore
caused tax expenses which were T€ 404 higher than in the previous year.
As already briefly discussed above, results at an amount below the 2016 budget were re-
ported. However, trends in the operating segments varied greatly, as they already had in pri-
or years. The deviations from the budget and prior year's figures are described separately be-
low.
Appendix I 6
Development of the business areas
Road transport
The road transport business ended the financial year with an ORI result of Tf -2,228 (prior
year: T€ -2,361). Consequently, this result is T€ 1,234 lower than the ORI results which were originally budgeted. Sales revenues again rose by 1.8% year-on-year to T€ 33,649. However,
subsequently the material usage ratio worsened from 81.3% to 83.1%, which means that the
gross profit (GPI) fell by -7.7% year-on-year to T€ 5,702 (prior year: T€ 6,181). In addition,
personnel expenses rose by another T€ 71 or 1.7% compared to 2015 (prior year: T€ 4,258)
to T€ 4,329, which caused a deployment of personnel rate (relating to gross profit) of 75.9% (prior year: 68.9%). Despite expenses for IT rising by Tf 277 in the segment, the operating
and administrative expenses achieved a decrease of T€ 109 between 2016 and 2015 thanks
to savings of T€ 332 for rental expenses. Moreover, internal administrative allocations fell by T€ 650 in the reporting year compared to the same period in the previous year (prior year:
T€ 1,961).
Air freight
The Company described very positive development of results in the field of air freight with an
ORI result of T€ 1,464 (prior year: T€ 33). Thus, it exceeded the budget for the reporting year
by T€ 328. While year-on-year decreases of 10.8% were recognised overall and revenues of
T€ 21,195 were reported in 2016, gross profit (GPI) only fell by 2.5% to T€ 4,653. Conse-
quently, the gross profit ratio was 22.0% in reporting year 2016 (prior year: 20.1%). Signifi-
cant savings were realised compared to 2015 in particular for personnel expenses, which fell
by 41.4% or T€ 1,219. This was caused by the staffing levels falling by 20.1% and a considera-
ble increase in efficiency. In contrast, the operating and administrative expenses of T€ 781
and were recognised, which was at the previous year's level (prior year: T€ 782). Internal
administrative allocations were also reduced by 24.5% to T€ 747 (prior year: T€ 990).
Sea freight
The ORI results for the sea freight area were T€ 1,129, which means that the budgeted result
was not achieved. Prinnarily due to lower sea freight rates, there was a sales revenue de-
crease of 8.9% to T€ 33,141 in 2016. However, this was barely reflected in the gross profit,
which only decreased by 0.1% and at T€ 5,785 was maintained at the previous year's level
(prior year: T€ 5,789). Accordingly, the gross profit ratio improved from 15.9% in 2015 to
17.5% in 2016. Personnel expenses also fell here by Tf 174 (-6.5%) compared to the previous
year's level. The deployment of personnel rate improved correspondingly by 46.6% in the
prior year to 43.7% in the 2016 reporting period. The operating and administrative costs rose
by T€ 174 or 28.1%, which was mainly due to the implementation of a new transport man-
agement system. Administrative costs in this segment increased by T€ 204 compared to the
prior year (T€ 1,121).
Appendix I 7
Contract logistics
Following weak ORI results in the prior year (T€ 372), the contract logistics segment recog-
nised results which are again T€ 1,204 better in 2016 and completed the year with compre-
hensive income of T€ 1,576. The segment recognised results of T€ 101, which fell slightly be-
low the budgeted expectations. Although revenues rose by 2.9% to T€ 13,689 in 2016 (prior
year: T€ 13,308), at the same time the expenses for purchased services were 6.0% and thus
rose beyond the previous year's level. Thus, the total gross profit (GPI) was T€ 5,779 in 2016
and subsequently 1.2% below the 2015 value. In order to take this amount into account, jobs
had already been cut in the prior year, which then led to a decrease in personnel expenses of
T€ 691 or 20.6% year-on-year. Operating and administrative expenses declined by a further
T€ 66 or 6.0%. Internat administrative expenses of T€ 553 were reported, which was also
considerably lower than the previous year's level of T€ 1,032.
Frankfurt Exhibition segment
The exhibition division at the Frankfurt location was sold to Sempex Deutschland GmbH on
October 1, 2016, as part of an asset deal. The Company generated positive sales proceeds of
T€ 54 from this transaction. However, the business activities of the exhibition department
were only budgeted for half a year, up to and including June 2016. The entire division com-
pleted 2016 with a negative ORI result of T€ -6, which means that it fell below the budget of
T€ 70. However, this result also includes the restructuring expenses totalling T€ 76, which
had not been included in the budget. In the period from January 2016 to September 2016,
during which the exhibition division's operating activities were comparable in both the re-
porting year and the prior year, revenues did rise by T€ 79 or 6.3% compared to the same pe-
riod in the prior year 2015. Nevertheless, gross profit declined by 5.1% over the first three
quarters and was recognised at T€ 481. Personnel expenses decreased by T€ 52 or 18.0%
within the first nine months of 2016 compared to the same period in the prior year. In con-
trast, operating and administrative expenses were T€ 18 or 17.9% higher than in the same
periods of 2015 due to higher IT costs.
Intercompany allocations and internal administration (Head Office ATEGE)
Internat administrative costs declined by T€ 1,547 to T€ 3,971 (prior year: T€ 4,973) — without
including the revaluation of pension obligations due to the lowest interest rate level in the
amount of T€ 565 (prior year: T€ 104). The expenses relating to central administration pri-
marily comprise personnel expenses of T€ 3,592 (prior year: T€ 2,995) as well as operating
and administrative expenses of T€ 1,462 (prior year: T€ 1,941). The personnel expenses ex-
cluding pension provisions indicated a slight increase of a moderate 1.1% or T€ 32 compared
to the prior year. In contrast, the other administrative costs fell by another 24.9% or T€ 479
between 2015 and 2016, which was mainly a result of lower EDP expenses because these are
now charged to the divisions based on their cause beginning in this reporting year. The com-
pany spent a total of T€ 132 or 20.7% more for EDP in 2016 than in 2015. The intercompany
allocations of Gondrand International AG comprising management and IT allocations, only
amounted to T€ 2,397 (prior year: T€ 2,871). Thus they have fallen by 16.6% compared to
2015.
Appendix I
8
9. Situation of the Company
Net assets
Total assets increased slightly from T€ 31,160 in the previous year to T€ 31,543.
Fixed assets dropped by TE 823 overall to T€ 5,873, while current assets fell by TE 619 to
T€ 22,167.
This decrease in intangible and tangible assets is essentially based on the scheduled annorti-
zation and depreciation in the year under review. There were investments of T€ 74, which
was less than the annortization and depreciation of TE 265.
This decrease in financial assets results from the scheduled repayment of the loan to
Gondrand Properties Switzerland in the amount of T€ 600. Shares in affiliated companies de-
clined by TE 26 compared to 2015 owing to the merger of the KT Kombi GmbH and ATEGE.
Thus, the share of the fixed assets (T€ 5,873; prior year: T€ 6,695) in the total assets was
18.9% (prior year: 21.5%).
The share of the current assets (TE 22,167; prior year: TE 22,786) fell from 73.1% to 70.3%.
Trade receivables were reduced by T€ 420 or 2.7% compared to the prior year.
Receivables from affiliated companies (T€ 848) fell slightly compared to 2015 (prior year:
T€ 906). These primarily relate to trade receivables from Gondrand International AG, Switzer-
land
The decrease in other assets of T€ 209 to just T€ 559 flow is mainly due to the loss of a cor-
po rate income tax receiva ble.
With regard to liabilities, losses of T€ 2,724 have been carried forward from the previous year
in 2016 (prior year: Te 0). The loss not covered by equity (prior year: T€ 1,624) increased fur-
ther to T€ 3,437 due to the additional net loss for the year in the amount of T€ 1,813 in 2016
(prior year: T€ 3,725). Thus, the equity remains negative (T€ 0; prior year: T€ 0) and contin-
ues to be recognised on the asset side as a loss not covered by equity.
Provisions have risen from T€ 14,216 to T€ 14,658, of which TE 11,359 relates to pension
provisions (prior year: T€ 10,936). The other provisions of T€ 3,299 (prior year: T€ 3,276) pri-
marily comprise forwarding provisions of T€ 1,924 (prior year: T€ 1,710), provisions for per-
sonnel expenses of T€ 545 (prior year: T€ 907).
Liabilities decreased by T€ 59 year-on-year and amounted to T€ 16,886. In this context, while
trade liabilities decreased by TE 2,139 to T€ 7,788 (prior year: TE 9,927). However, at the
same time the liabilities due to affiliated companies (T€ 4,549; prior year: T€ 2,386) increased
by T€ 2,163. This now includes T€ 2,000 relating to a loan from Gondrand Holding AG to
ATEGE which is laid out until the end of 2019, as well as trade payables.
The other liabilities of T€ 4,549 primarily relate to liabilities from customs and import duties
in the amount of T€ 3,891 (prior year: T€ 3,803).
Financial position
ATAGE's current liabilities were covered by cash assets at all times in 2016. In addition, the
Company has a letter of comfort from the parent company in the amount of TE 4,000.
Appendix I 9
The Company's financial and liquidity position is characterised by a surplus of current liabili-
ties and other current assets in excess of the current trade liabilities in the amount of
T€ 1,635 (prior year: T€ 263).
Bank and account credits amounted to T€ 5,623 as of December 31, 2016 (prior year:
T€ 5,377), which represents an increase of T€ 246 compared to 2015. As already explained in
the description of the financing, a portion of this is tied to hedging bank guarantees relating
to customs and rental guarantees in the amount of T€ 2,546 (prior year: T€ 2,545).
Appendix I
10
Results of operations
The Company's results of operations improved year-on-year to a net loss for the year of T€ -
1,813 (prior year: T€ -3,725). Gross profit and its decrease of T€ 916 had an effect in this con-
text because the cost of materials fell more sharply (T€ 3,909 or 4.6%) than the sales reve-
nues (T€ 4,825 or 4.5%). Personnel expenses decreased considerably by 5.1% by T€ 832 to
T€ 15,504.
With regard to the services, gross proceeds can be broken down as follows:
2016 2015
Road transport (Road) 32.6% 30.6%
Air transport (Air) 20.5% 22.0%
Sea transport (Sea) 32.1% 33.7%
Contract logistics (Logistics) 13.3% 12.3%
Other services (Others) 1.4% 1.4%
The gross profit ratio (including other operating income) improved from 22.9% to 23.3%. The
cost of materials ratio fell from 77.4% to 77.1%, mainly due to better procurement options in
the air freight division.
Other operating income was T€ 262 higher than in the prior year. This is predominantly ow-
ing to income from the release of personnel provisions.
In absolute terms, personnel expenses did decrease by T€ 832 or 5.1%. However, the de-
ployment of personnel rate (relating to sales revenues) fell only slightly to reach 15.0% (prior
year: 15.1%) because sales revenues declined by T€ 4,825 or 4.5% at the same time. Besides
lower wage and salary expenses, the decline is personnel expenses is primarily a result of
cutbacks in annual and Christmas bonuses.
The amortisation and depreciation on intangible fixed assets and tangible assets were recog-
nised in the amount of T€ 265 (prior year: T€ 303), which was slightly lower mainly because
of the lower depreciation on EDP hardware.
Other operating expenses fell by T€ 2,106 or 18.4%. This decrease is mainly due to the de-
recognition of unrecoverable receivables being T€ 679 (89%) lower than in the prior year, a
reduction in intercompany allocations for management and EDP services of T€ 475 (16.6%),
lower costs for temporary employment of T€ 374 (77.2%), and decreased rental costs in the
amount of T€ 315 (17.1%).
The negative financial result of T€ 471 (prior year: T€ 467) was nearly unchanged compared
to the prior year (0.9%) and mainly comprises interest expenses for non-current liabilities.
According to the regulations set out in the German Accounting Directive Implementation Act
(BilRUG), the Company has no longer recognised extraordinary expenses in 2016 (prior year:
T€ 201). Instead, the proportionate addition to the pension provision arising from the Ger-
man Accounting Directive Implementation Act adjustment as of January 1, 2010 in the
amount of T€ 201 are being recognised as other operating expenses in 2016.
The taxes on income amounted to T€ 180 (prior year: T€ -234) as no material tax reimburse-
ments were granted in the reporting year as opposed to the prior year. Other taxes were
negative at T€ 55 (prior year: T€ -66). This change is prima rily due to a lower property tax
burden.
Appendix I
11
Ill. Opportunities and Risk Report
Opportunities of future development
ATEGE see its competitive advantage in its close customer relationships. At ATEGE, our range
of services focuses on the customer. Customer requirements and special handling are real-
ised at our Company at a high level of quality by our skilled staff. This individual focus on the
customer allows us to offer a range of services which large service providers with their more
industrial production methods usually cannot supply.
Integration in the Gondrand Group facilitates the comprehensive joint cultivation of markets,
the advantage of using synergies with regard to costs, and the availability of developed man-
agement tools. The implementation of cross-border committees known as "business units"
for each product range, joint goals are set and their realisation is pursued under the leader-
ship of Group management. These business units are in place in particular for the field of
road transport, as well as for sea and air freight. The sector and branch managers of the
German companies also participate in these business units.
ATEGE has a strong network of agents which has proved itself over many years. On the basis
of this network, the Company continues to aim to generate new orders and expand its col-
laborations by strengthening their lines of products.
The restructuring measures rolled out within the course of 2017 will entail cutting approxi-
mately 80 jobs and thus considerable decreases in personnel expenses in the amount of
around T€ 3,967 in comparison with 2016. Intercompany allocations, which were still recog-
nised at T€ 2,397 in 2016, are expected to only amount to T€ 1,940 in 2017 and drop again by
approximately T€ 300 for the subsequent year 2018. Moreover, numerous operating and
administrative areas have been screened and optimised. In this context, the scope ranges
from moderate price increases according to general market conditions to various measures,
some of which entail significant cost cutting on an annual basis. For example, these measures
include the withdrawal from costly special projects (approximately T€ 100), more targeted
management of marketing expenses (approximately T€ 100), the modification of involve-
ment in various national network structures (approximately T€ 108), and the prevention of
default of receivables through the use of a service provider (approximately T€ 110). These
and other measures, in interaction with the consistent utilisation of revenue potential from
ATEGE's large agent and partner network lead to the opportunities being assessed as positive
overall by management.
Risks of future development and the assessment of the overall view of the risk situation
Both opportunities and risks are associated with ATEGE's business activities. These risks could
have a negative impact on the operating activities, as well as the assets, financial position,
and income. The risks described below are listed in descending order of (any negative) finan-
cial implications.
Due to the close interlocking with other parts of the economy, the Company is exposed to
general economic risk. Recessive changes to the general economic environment have the ef-
fect that demand for logistics services falls in the areas of warehousing and transport ser-
vices. The Company counteracts this risk with intensive market monitoring and early warning
indicators to ensure it is possible to react flexibly to revenue decreases.
The Company's economic success is strongly dependent on the market-driven purchase of
transport services from shipping companies, air freight companies, and trucking companies.
As a result of a short-term and medium-term agreement with customers in the freight seg-
ment (air, sea, road), daily market conditions are usually passed on to customers. With re-
Appendix I 12
gard to contracts with longer terms, fluctuations in the individual type of costs can have ei-
ther positive or negative implications. This risk is taken into account with relevant provisions
specifying appropriate surcharges in the contracts. Furthermore, combining freight orders
through all of the Gondrand Group companies opens up the opportunity of receiving better
freight rates for procurement. This results in stronger convetitiveness on the market.
Using its global agent network, ATEGE receives more orders for the freight processing of their
customers than it itself commissions. This implies a higher risk if there are agent losses and in
the collection of receivables. In addition, there is a risk of agent changes, which would have a
negative effect on the existing business for a transition period. ATEGE counteracts this risk by
maintaining its agent relationships, constantly monitoring their creditworthiness, and by
means of a global, transnational collaboration among the Gondrand companies for the moni-
toring of outstanding receivables.
Especially for the high level of customisation in the Group, long-standing customer and agent
relationships also frequently depend on individual employees. In this respect, employee fluc-
tuation also always poses a risk of losing trust and business. ATEGE strives to minimise this
risk by means of the regular and targeted measurement of the fluctuation rates, continuing
education measures, and close collaboration at the management level.
The Company bilis and purchases services primarily in euros. If there is a discrepancy in the
currencies in certain segments, potential risks are taken into account or renegotiated when
signing the contract. In the year under review, ATEGE reported net expenses from foreign
currency translation of T€ 76 (prior year: T€ 136). Experience has shown that as a rule foreign
currency losses and gains are evenly balanced over multi-year periods. Against this back-
ground and in view of the comparatively low processing volume denoted in foreign curren-
cies, hedging transactions were also not concluded in 2016. Should this initial situation
change in the future, the use of hedging transactions would be considered within the frame-
work of assessing the Company's risk.
The Company does not have any bank debts to be recognised on the balance sheet. As of the
reference date, cash in hand and bank balances rose by T€ 246 compared to the prior year. It
became necessary to add additional capital in excess of the current cash flow from operating
activities as a result of the Company's loss situation in the past, inter aha. ATEGE partially ef-
fectuates this with its capital resources and partially through shareholder contributions.
There can still be risks from cash flow fluctuations (liquidity risks). However, the safeguarding
that the Company is solvent at all times is ensured by the letter of comfort issued by the
Gondrand Holding. ATEGE's management expects a sustainable improvement to the liquidity
position as a consequence of the restructuring nneasures which were rolied out in 2017.
In addition to the risks described above, changes to the legislative framework conditions can
have negative implications for the Company. In this context, ATEGE is required to look after
the strict compliance with the country-related regulations for the security precautions for the
transport of air and sea freight. This is particularly important to minimise the risks when issu-
ing statements of independence to the air freight companies. A further tightening of the se-
curity regulations — in particular in the field of air freight and for combating piracy and terror-
ism — could lead to further financial burdens for the Company. It would only be possible to
pass these burdens onto customers to a limited degree.
ATEGE counteracts risks associated with relocating traffic flows by means of intensive market
monitoring and the continuous advancement of its range of services in close collaboration
within the Gondrand Group.
In the field of logistics, long-term leases are usually entered into in order to fulfil customer
requirements. If these services are eliminated or relocated from the locations, there is a risk
of at least partial cost remanence. This risk is limited through intensive planning meetings
with the customer and potentially back-to-back constellations.
Appendix I
13
Due to existing measures within the framework of a uniform group risk management system,
the probability of occurrence for the aforementioned individual risks is considered relatively
low, and the severity of each is considered low anyway. Nevertheless, certain critical implica-
tions on the assets, financial position, and income cannot be completely ruled out. Manage-
ment considers the financial effects of the risk and the overall risk position to be manageable
overall.
IV. Forecast
Positive operating results before intercompany allocations of € 2.9 million are forecast for fi-
nancial year 2017. However, in particular because the revenues and margin development did
not meet expectations and owing to the restructuring measurements described above, it will
no longer be possible to achieve this goal. In order to ensure the going concern of the com-
pany nevertheless, the following measures have been taken:
• Resolution to refinance the company using funds from the group par-
ent company.
• In order to recapitalise the Company, a loan receivable of Gondrand
Holding AG from ATEGE in the amount of T€ 2,000 was converted to
equity within the framework of a debt-equity swap.
• Furthermore, Gondrand International AG waived receivables of ATEGE
relating to management and IT allocations in the amount of T€ 2,618.
• Further restructuring in the field of road transport under the umbrella
of the Gondrand Group.
• Closure of a logistics branch which is not expected to be operated prof-
itably in the future.
• Close collaboration between the branches and with the agents in the
air and sea freight area to generate economies of scale.
• Creation of synergies by centralising the service functions for the
Gondrand Group.
In the first ten months of 2017, ATEGE generated earnings before intercompany allocations
of T€ -765, including costs for special effects arising from the restructuring (prior year:
T€ 2,407). Therefore, management established its extensive restructuring scheme which re-
sulted in higher expenses in 2017. Management expects a positive ORI in the amount of
T€ 2,681 for the Company again in 2018.
Frankfurt am Main, December 20, 2017
ATEGE
Allgemeine Transportgesellschaft
formerly Gondrand & Mangili mbH
The Management
Volker Henze
Appendix II 7
Notes for Financial Year 2016 of ATEGE Allgemeine Transportgesellschaft vorm. Gondrand & Mangili mbH, Frankfurt am Main
Registered Office of the Company: 60314 Frankfurt am Main, Frankfurt am Main Local Court, HRB 86734
A. General Information on the Annual Financial Statements
The annual financial statements are prepared in accordance with the accounting regulations applica-ble to corporations of the German Commercial Code (Handelsgesetzbuch — HGB) with due considera-tion given to the German Limited Liability Companies Act (Gesetz betreffend die Gesellschaften mit beschrånkter Haftung — GmbHG).
According to the definition of size classes contained in Section 267 HGB, the Company is a "large corporation" pursuant to Section 267 (3) HGB.
The balance sheet is structured according to the provisions of Section 266 HGB.
As regards the structure of the income statement, we opted for the total cost method. This structure corresponds to Section 275 (2) HGB).
Pursuant to Section 290 HGB, the Company is as a matter of principle required to prepare consolidat-ed financial statements. However, due to the fact that the subsidiaries are negligible for the valuation of the Company's net assets, financial position and results of operations pursuant to Section 296 (2) HGB, the exemption provision of Section 290 (5) HGB is applied.
B. Information on the Accounting and Valuation Methods
The income statement was prepared according to the total cost method. During the reporting year, the Accounting Directive Implementation Act (BilRUG) led to deviations from the presentation methods applied in prior periods, and the item "Extraordinary expenses" of the income statement and therefore also the subtotals "Income from ordinary activities" and "Extraordinary result" were deleted. Due to the deletion of the item "extraordinary expenses", the amounts shown under this itern in the prior year were reclassified to personnel expenses. Another change in the structure of the income statement is made by the addition of a subtotal named "Profit after taxes", which is stated between the items "Tax-es on income" and "Other taxes".
Fixed Assets
Intangible Assets
Acquired intangible assets are stated at amortized cost. Amortization is calculated using the straight-line method over a period of 3 to 5 years according to schedule.
Tangible Assets
Items stated under tangible fixed assets are measured at depreciated cost and written down according to schedule pro rata temporis.
Depreciation is determined over the probable useful lives of the respective assets and in line with the standard useful lives. To this end, the straight-line method is applied for movable assets. The useful lives of the individual assets are estimated on the basis of their scheduled useful lives.
Useful lives are structured as follows:
Buildings: 40 to 60 years
Technical equipment and machinery: 5 to 10 years
Appendix II 8
Factory and office equipment: 3 to 10 years
Financial Assets
Financial assets are stated at cost. Valuation impairments to the lower fair value are recognized in the event that a permanent impairment in value is projected.
Current Assets
Inventory items as a matter of principle are stated at cost. The strict lower of cost or market principle is adhered to for such valuation.
Statement of receivables and other assets is made at the respective nominal value. Discernible risks are considered by valuation allowances.
In addition to individual valuation allowances, doubtful trade receivables are valued with a general valuation allowance of 1% for the general receivables risk.
Receivables denominated in foreign currencies are stated at the historical rate at the time of initial booking. Gains and losses due to exchange rate fluctuations are recognized affecting income as of the balance sheet date.
Short-term securities are stated at the lower of cost or applicable fair value as of the balance sheet date.
Cash on hand, bank balances and checks are reported at nominal value.
Prepaid Expenses and Deferred Charges
Prepaid expenses and deferred charges include expenditure incurred before the reporting date, to the extent such expenditure relates to a certain period after that date.
Deferred Tax Assets
The capitalization option (Section 274 (1) Clause 2 HGB) was exercised and no deferred tax assets were recognized.
Shareholder's Equity
Shareholder's equity is stated at nominal value.
Provisions
Provisions for pensions and similar obligations are calculated on the basis of the valuation require-ments of Section 253 (1) Clause 2 and (2) HGB, according to which provisions are to be stated at the discounted required settlement amount.
Valuation is determined by reknown actuarial principles using the projected unit credit method (PUC method). The biometric basis for this are the 2005 G mortality tables of Prof. Dr. Heubeck. The deter-mined underfunding was calculated as of January 1, 2010 and the difference was allocated to pension obligations at 1/15.
Provisions for anniversary bonuses are measured using the method and accounting principles analo-gous to those used to determine provisions for pensions and similar obligations.
Pension obligations were determined on the basis of the following assumptions:
• Interest rate p.a.: 4.01%
• Salary trend p.a.: 2.00%
• Trend of the contribution assessment ceiling p.a.: 2.00%
• Pension trend p.a.: 2.00%
Exercising the option according to Art. 75 (7) EGHGB new version, the average market interest rate of the past ten years calculated by the German Bundesbank for this residual term was used as the dis-
Appendix II 9
count factor. The discount-related difference of TE 1,280 (prior year: TE 664) is barred from distribution pursuant to Section 253 (6) Clause 2 HGB.
Other provisions take into account all recognizable risks and contingent liabilities. Their amount was stated at the settlement amount required according to prudent business judgment. Longer-term provi-sions are discounted in accordance with the respective legal provisions.
The valuation of provisions for anniversary bonuses is based on the following assumptions:
• Interest rate p.a.: 3.24%
• Salary trend p.a.: 2.00%
• Trend of the contribution assessment ceiling p.a.: 2.00%
. Fluctuations p.a.: 18.90%
Liabilities
Liabilities are recognized at their settlement amount. Payables denominated in foreign currencies are stated at the historical rate at the time of initial booking. Losses arising from exchange rate fluctuations are recognized affecting income as of the balance sheet date.
Sales Revenues
Sales revenues are deemed to have been realized when the service has been rendered.
C. Comments on the Balance Sheet
Fixed Assets
The development of fixed assets contained in the balance sheet is stated separately in the fixed-asset movement schedule. The gross fixed-asset movement schedule is attached separately in the form of an Appendix to the notes. A list of shares in affiliated companies and other long-term equity investees and investors is included under "E. Other disclosures".
Current Assets
Receivables from affiliated companies do not contain any receivables from the shareholder.
The general default risk with regard to trade receivables is taken into account by means of a general valuation allowance in addition to the respective individual valuation allowances, due to the fact that the total current account excludes an individual assessment of all receivables due to its scope. Valua-tion impairment during the year under review totaled TE 338 (prior: TE 345).
All receivables and other assets are due within one year.
Bank balances in the amount of TE 2,546 (prior year: TE 2,545) serve as a collateral for guarantees granted.
Deficit not Covered by Equity
The net loss of the prior year which is not covered by equity (TE 1,624) increased by TE -1,813 to TE 3,437 during the year under review.
Provisions
The difference of TE 3,018 determined in accordance with BilMoG as of January 1, 2010 was allocat-ed to pension obligations at 1/15 (TE 201). Pursuant to Section 285 No. 31 HGB, the difference is allocated to pension provisions (prior year: reported as extraordinary expenses). As of December 31, 2016, the pension obligations carried as liabilities amounted to TE 11,359. As of the balance sheet date, there still is a deficit of TE 1,610, which is to be balanced by 2024.
Appendix II 10
Other provisions totaling TE 3,299 (prior year: TE 3,276) for the most part contain provisions for carrier companies not yet determined of TE 1,924 (prior year: TE 1,710), TE 362 (prior year: TE 707) for royal-ties and special payments, TE 219 (prior year: TE 201) for severance payments, TE 106 (prior year: TE 85) for consultation expenses, TE 125 (prior year: TE 122) for leave not yet taken, TE 176 (prior year: TE 157) for employers' liability insurance association and TE 60 (prior year: TE 62) for anniver-sary gratifications.
Liabilities
Total liabilities in the amount of TE 16,886 (prior year: TE 16,944) as of the balance sheet date have a residual term of:
up to one year: TE 14,886 (prior year: TE 16,922)
more than one year: TE 2,000 (prior year: TE 22)
Just as in the prior year, there are no liabilities with a residual term of more than five years as of the balance sheet date.
Payables to affiliated companies include payables to the shareholder in the amount of TE 2,000, which exclusively refer to loan obligations (prior: TE 1)
Other liabilities contain payables to customs authorities in the amount of TE 3,891 (prior year: TE 3,803)
There are no collateral securities for liabilities.
Deferred Taxes
Deferred tax assets mainly consist of deferred tax assets due to temporary differences in pension obligations, as well as of tax loss carryforwards. Deferred tax assets from tax loss carryforwards are expected to be realized within the next 5 years. The statement of the capitalization option in the bal-ance sheet is waived. The calculation of deferred taxes was based on a corporation tax rate of 16% and a trade tax rate of 14%.
Appendix II 11
D. Comments on the Income Statement
Sales revenues/Carrier Gross Profit
Sales revenues/carrier gross profit (according to the internal income statement) are structured as fol-lows:
Sales in TE prior year TE qross profit in TE prior year TE
Overland transports (road) 33,649 33,064 5,702 6,181
Oversea transports (sea) 33,141 36,378 5,785 5,789
Air freight (air) 21,195 23,766 4,653 4,773
Logistics (logistics) 13,689 13,308 5,779 5,846
Other services (others) 1,472 1,455 551 653
Total 103,146 107,971 22,470 23,242
Gross profit = Gross forwarding income = Revenues - Cost of purchased services + Income from the reversal of forward ing provisions.
Due to the application of Section 277 (1) HGB as amended by the BilRuG, comparability to the re-spective prior year figures of sales revenues is no longer given. In accordance with the requirements of the Accounting Directive Implementation Act (BilRUG), the following income was allocated to sales revenue for the first time in the year under review: Tenancy income TE 35 (prior year: TE 29), income from the recharging of fees, licenses and material expenses TE 28 (prior year: TE 93)
In case Section 277 (1) HGB in the version of BilRuG was applied, prior year figures were structured as follows:
2015 2015 2016 (prior to Bil- (according to (according to
RUG) BilRUG) BilRUG) TE 107,971 TE 108,092 TE 103,146
Land transport sales revenues are generated in Europe. The main sales areas of sea freight and air freight are: Asia, North America, Japan, Africa, South America and Central America.
Pursuant to Section 286 (2) HGB, the Company refrains from a detailed breakdown of sales revenues by geographically defined markets in order to avoid disadvantages for the Company.
Other Operating lncome
Other operating income mainly results from the reversal of provisions in the amount of TE 526 (prior year: TE 526: TE 142), income from currency differences of TE 257 (prior year: TE 387), proceeds from the use of vehicles of TE 260 (prior year: TE 285), and income not relating to the period of TE 291 (pri-or year: TE 46).
Other Operating Expenses
Other operating expenses mostly result from management fees and allocations of the parent company amounting to TE 2,397 (prior year: TE 2,873), leases and rents amounting to TE 1,968 (prior year: TE 2,340), fees and legal services of TE 486 (prior year: TE 694), insurance premiums of TE 378 (prior year: TE 457) and exchange rate differences of TE 302 (prior year: TE 502).
Interest Expenses
Interest expenses in the amount of TE 545 (prior year: TE 577) relate to the compounding of pension provisions (prior year: 3) to the discounting of anniversary provisions.
Extraordinary Expenses
Extraordinary expenses in the prior year included additions to pension obligations of TE 201 (prior year: TE 201) amounting to 1/15 of the difference in pension obligations calculated in accordance with
Appendix II 12
BilMoG. In accordance with the German Accounting Law Modernisation Act (BilRuG), this item is re-ported under other operating expenses during the year under review.
Appropriation of Profits
In analogous application of Sections 158, 240 (1) AktG, an appropriation of earnings statement was included in the income statement for financial year 2015. Based on the net loss for the year 2015, the loss carried forward to the new account, the withdrawals from capital reserve and revenues reserves as well as income from the capital decrease, total net losses for the year 2015 amount to € 2,723,815.27. In financial year 2015, total net loss of 2015 included deficit not covered by equity as well as the total net loss covered by equity. Loss carried forward in 2015 pursuant to Section 268 (1) HGB amounts to € 2,828,070.45.
Tax Field Audit
The Company has been conclusively audited up to and including the 2011 assessment period with regard tor corporation tax, trade tax, income tax and turnover tax. The income tax audit has been car-ried out up to and including 2014.
By letter dated December 15, 2016, a tax field audit of the calendar years 2012 to 2014 was ordered with regard to corporation tax, trade tax, income tax and turnover tax.
Company Country Forwarding ser-
vice €
Loan
interest received E
I Group affili-
ations
Gondrand Intern. AG Switzer-land
371,851
prior year:
2.)
475,503
Gondrand Properties AG Switzer-land
46,822
prior year:
63,027
171,882
Transfin Srl Italy prior year:
2.)
Gondrand Traffic BV Nether-lands:
5,062
prior year: 2.)
239
291,486
Gondrand Kft Hungary prior year:
2.)
270,480
8,891 ' Czech Gondrand a.s ' Republic prior year:
2.)
15,403
1,070,306
GO-Trans Ltd. China prior year:
2.)
1,142,355
Appendix II 13
E. Other Information
Group Affiliation
The consolidated financial statements for the smallest and (at the same time) largest group of compa-nies are prepared as of December 31, 2016 by Gondrand Holding AG, at the Company's registered office in Basel, Switzerland. They are available at the Company's registered office.
ATEGE Frankfurt/Main is the parent company of the following German subsidiaries, and consequently obliged to prepare consolidated financial statements in accordance with Section 290 (1) HGB:
• Gondrand GmbH, Frankfurt am Main; held by ATEGE (99.6%) and Gondrand Holding AG, Basel, Switzerland, (0.4%)
Due to the minor importance of the subsidiaries pursuant to Section 296 (2) HGB, no consolidated financial statements were prepared for 2016 pursuant to the exemption provisions contained in Sec-tion 290 (5) HGB.
Business Relationships with Related Parties:
Revenues generated with affiliated companies in 2016:
Appendix II 14
Expenses with affiliated companies recognized in 2016:
Company Forwarding Management-
Country service € costs €
Loan ICT-costs €
interest paid €
Group
affihia-tion
Switzer-
Gondrand Intern. AG land
184,948
prior year: 278,095
1,043,926
prior year: 1,403,451
1,352,613
prior year: 1,468,455
2.)
Switzer-
Gondrand Holding AG land
8,035
prior year: 1.)
Transfin Srl
Gondrand Traffic BV
Gondrand Kft
Gondrand a.s
GO-Trans Ltd. China
470,269
prior year: 125,483
22,847
prior year: 54,473
275,550
prior year: 288,710
883,641
prior year: 855,183
1,682,143
prior year: 2,015,834
Italy
Nether-lands:
Hungary
Czech Republic
2.)
2.)
2.)
2.)
2.)
Comment: 1.) = parent company 2.) = associated company
Auditor's Fee
The auditor's fee amounts to TE 167 (prior year: TE 233) and is structured by the following areas:
• Audit of the annual financial statements: TE 67 (prior year: TE 90)
• Tax consultation: TE 88 (prior year: TE 143)
• Other consultation: TE 12 (prior year: TE 0)
Other Financial Obligations
Long-term contracts are expected to result in payment obligations of TE 4,348 (prior year: TE 4,600). Of this amount, TE 1,055 (prior year: TE 834) relate to obligations from leasing contracts and TE 3,293 relate to tenancy agreements (prior year: TE 3,765). Maturities are structured as follows:
Up to one year TE 2,007
More than one year: TE 2,253
More than five years: TE 88
The Company has tenancy, guarantee and customs guarantees in the amount of TE 2,546 (prior year: TE 2,545). The guarantees are secured by company funds.
Appendix II 15
Staff
During the year under review, an average of 303 employees and 48 trainees were employed, divided into the following areas:
• Operating activities: 326
ø Administrative activities: 25
Bodies of the Company
Supervisory Board
- Mr. Julien Houart, Dubai (Chairman of the Board; Gondrand Holding AG, Basel)
- Mr. Anthony Ranson, Schilde/Belgium (CEO Gondrand Group; Gondrand Holding AG, Basel)
Managing Director
- Mr. Marco Salzmann, Frankfurt am Main, graduate in business administration, Managing Di-rector of ATEGE Allgemeine Transportgesellschaft vorm. Gondrand & Mangili mbH, Frankfurt am Main (until August 2, 2017)
- Mr. Volker Henze, merchant, Managing Director of ATEGE Allgemeine Transportgesellschaft vorm. Gondrand & Mangili mbH, Frankfurt am Main (since August 2, 2017)
Expenses for Members of Governing Bodies
Utilizing Section 286 (4) HGB, statement of remuneration of the Managing Directors is waived.
The pensions of former management members amounted to TE 219,095. There are pension obliga-tions for former members of the Management Board in the amount of TE 2,512,212.
No compensation was paid to the Supervisory Board in financial year 2016.
Share Ownership
The shareholdings consist of shares in affiliated companies and participations in freight forwarding interest groups and are as follows:
Shares in affiliated companies
Gondrand GmbH, Frankfurt/Main, share of 99.6%
(Equity 2016: € 37,379.20; loss 2016: TE 16)
(Equity 2015: € 53,576.78; profit 2015: TE 15)
KT Kombi-Trucking GmbH, Frankfurt/Main was transferred to the parent company ATEGE Allgemeine Transportgesellschaft vorm. Gondrand & Mangili mbH by notarized deed as of August 29, 2016, with tax effect as of January 1, 2016. The merger results in a merger loss of € 5,072.98. Respective entry into the Commercial Register occurred on September 29, 2016.
Report of Subsequent Events
There were no significant transactions which occurred after the balance sheet date having an impact on the 2016 result.
For the further enhancement of liquidity, a loan in the amount of TE 2,192, which had been granted by ATEGE to Gondrand Properties AG within the framework of a sale of real estate in 2014, became immediately due in June 2017 and was repaid by the debtor. In addition, Gondrand Holding AG under-takes to provide liquidity up to a maximum of TE 464 by March 31, 2018.
In order to improve the Company's equity base, Gondrand Holding AG obliged via an agreement dat-ed May 23, 2017 to defer a loan of TE 2,000, declared its subordination and decided to state it under
Appendix II 16
free capital reserve. Furthermore, Gondrand International AG will waive receivables from management and IT allocations amounting to TE 2,618, of which TE 704 result from 2017.
In addition, the Company initiated a restructuring plan in the second half of 2017, which essentially includes a reduction in existing personnel expenses and other operating expenses. Furthermore, the projection planning of Gondrand International AG's group allocations resulted in a lower encumbrance in years to come. Based on this restructuring plan and the measures already resolved, the manage-ment assumes that all reqirements for a positive further development are given.
Comfort Letter
As of December 1, 2017, Gondrand Holding AG issued a comfort letter in order to ensure liquidity and to avoid a possible overindebtedness up to a maximum amount of 4.0 million for the benefit of ATEGE Allgemeine Transportgesellschaft vormals Gondrand & Mangili mbH. This comfort letter con-tained a subordination in the sense of of Section 19 (2) Clause 2 and 39 (2) lnsO and is not limited in time. Gondrand Holding AG obliges to deduct receivables from ATEGE only to the extent that any negative equity that may anse can still be covered by the letter of comfort.
By resolution of December 15, 2017, in connection with the capital contribution described above, the obligation of the comfort letter was limited to a maximum amount of 2.4 million for the negative equi-ty remaining in the 2017 annual financial statements. In case ATEGE will be furthermore unable to satisfy its payables in due time during a period up to March 31, 2018, Gondrant Holding promises ATEGE to balance any liquidity demand potentially rising from ATEGE's liquidity planning up to a max-imum amount of 463,752.
All other agreements of the comfort letter are not affected by these amendments.
Frankfurt am Main, December 20, 2017
Volker Henze
