DES Q1 e 2013

Interim Report Q1 2013 DES Interim Report Q1 2013 { 2 } Business and Economic Conditions Group structure and operating activities Activities Deutsche EuroShop is the only public company in Germany to invest solely in shopping centers in prime locations. As at the reporting date, it had investments in 20 shopping centers in Germany, Aus- tria, Poland and Hungary. The Group generates its reported revenue from rental income on the space which it lets in the shopping centers. Group’s legal structure Due to its lean personnel structure, the Deutsche EuroShop Group is centrally organised. The parent company, Deutsche EuroShop AG, is responsible for corporate strategy, portfolio and risk management, financing and communication. The Company’s registered office is in Hamburg. Deutsche EuroShop is an Aktiengesellschaft (stock corporation) under German law. The individual shopping centers are managed as separate companies and, depending on the share of nominal capital or voting rights, are either fully consolidated or accounted for using the equity method. The share capital amounts to € 53,945,536.00 and is composed of 53,945,536 no-par value registered shares. The notional value of each share is € 1.00. Macroeconomic and sector-specific conditions Despite the deepening recession in several Eurozone countries, Ger- many has weathered the crisis well so far. While growth rates remain at a low level, Germany still benefits from sound foreign trade and stable demand on the domestic front. The job market is similarly robust. However, the overall economic picture is not uniformly pos- itive. New orders in construction and German automobile sales, for instance, have slumped. Debt levels in some countries across the EU continue to rise despite every effort to cut spending. Reforms have triggered social unrest in some places. Unemployment is at a record high in the member states of Southern Europe. It remains to be seen whether Germany will be able to continue along its growth path in light of these nega- tive developments. Retail sales did not perform as well as expected during the first quar- ter of 2013. Year-on-year, the German retail sector saw a nominal 0.4 % increase, but a 1.0 % decrease in real terms. The average rate of inflation was at 1.5 %. Results of Operations, Financial Position and Net Assets Results of Operations Revenue increased by 10 % Revenue amounted to € 42.4 million as at 31 March 2013. This is nearly 10 % higher than in the same period of the previous year (€ 38.6 million), which can largely be attributed to the initial con- solidation of the Herold-Center in Norderstedt. Revenue also rose accordingly by 1.1 % year-on-year. Operating and administrative costs for property: 9 % Center operating costs were € 9.6 million in the reporting period, compared with € 7.4 million in the same period of the previous year. Costs therefore stood at 9.0 % of revenue (previous year: 10.9 %). Other operating expenses of €1.8 million The other operating expenses of € 1.8 million exceeded those of the previous year (€ 1.4 million) due to one-off costs (€ 0.5 million) incurred in connection with the corporate restructuring of two sub- sidiaries. EBIT up 10% EBIT increased by € 3.5 million (+10 %) from € 33.8 million to € 37.3 million. Net finance costs down €0.7 million At € -10.1, net finance costs fell by € 0.7 million which can be attrib- uted to the issue of a convertible bond at the end of the previous year as well as the higher profit share for third-party shareholders. Measurement gains / losses The measurement gain amounted to € -1.4 million and included investment costs incurred by our portfolio properties. EBT excluding measurement gains / losses up 14 % Earnings before taxes (EBT) increased from € 23.6 million to € 25.8 million (+12 %) while the earnings before taxes and measure- ment rose from € 24.5 million to € 27.9 million to end 14 % higher than over the same period of the previous year. Income taxes down on previous year As a result of last year’s restructuring, taxes on income and earnings declined and cannot be compared with the same quarter of the pre- vious year. Overall, the tax ratio fell from 30 % to 22 %. Tax expense amounted to € 5.7 million. € 1.0 million of this was attributable to income taxes to be paid and € 4.7 million to deferred taxes.

DES Q1 e 2013

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