1、2012Annual Report Summary of Consolidated Results31.12.201231.12.201131.12.2010ChangeSales(EUR K)28,42631,75327,690(10.5%)Total operating revenue(EUR K)29,04633,24228,338(12.6%)Operating performance(EUR K)30,70433,97129,706(9.6%)EBIT(EUR K)7856,6546,435(88.2%)EBIT margin(on sales)2.8%21.0%23.2%EBIT
2、margin(on total operating revenue)2.6%19.6%21.7%EBT(EUR K)819 6,5696,307(87.5%)Annual net income(EUR K)6754,5644,471(85.2%)Earnings per share(weighted)10.382.552.68(85.1%)Earnings per share(diluted)(EUR)20.382.552.68(85.1%)Equity ratio64.0%64.9%54.3%Net debt(EUR K)(6,789)(8,617)(7,457)(21.2%)12Devel
3、opments in terms of quartersEUR KQ1/2012H1/20129M/2012Total/2012Sales7,44516,23522,39628,426EBIT1,3762,9952,489785Surplus funds1,1232,1761,7946751 The calculations are based on the average number of shares(1,790,000)entitled to share in the profits on 31 December 2012.2 A Group share action program
4、had issued preemptive rights to 19,525 shares in all to Group employees by 31 December 2012.Content15 To the Shareholders17 Letter from the Management Board20 Corporate Governance Report 20 Cooperation between the Management and Supervisory Boards20 Transparency20 Risk Management20 Statement of Comp
5、liance23 Report by the Supervisory Board26 GK SOFTWARE AG Shares 26 Summary/Shares Performance26 Shareholder Structure27 Directors Dealings in 201127 Investor Relations29 Consolidated Annual Report30 Business Report30 Business and General Conditions at GK SOFTWARE47 Explanation of the Business Resul
6、ts and an Analysis of the Assets,Financial and Earnings Situation52 Report on Key Events after the Balance Sheet Date53 Report on Risks and Prospects at GK SOFTWARE53 Risks 56 Opportunities 57 Outlook58 Other Information According to Section 315 of the German Commercial Code58 Principles of the Comp
7、anys Remuneration System63 Consolidated financial statements 201264 Consolidated Balance Sheet 64 Assets65 Liabilities66 Consolidated Income Statement 67 Consolidated Results Accounts 67 Statement of Changes in Equity 68 Consolidated Cash Flow Statement 68 Cash Flows from Operating Business69 Cash F
8、low provided by financing costs,credits and means of payment70 Notes on the Consolidated Accounts 70 1.Principles of Reporting76 2.Balance Sheet and Assessment Principles86 3.Notes on the Consolidated Balance Sheet95 4.Notes on the Consolidated Income Statement99 5.Notes on the Cash Flow Statement99
9、 6.Acquisition of Subsidiaries102 7.Segment Reporting103 8.Other Information111 Assurance by the legal representatives 113 Audit Opinion 4SAP clearance for the sale of three solu-tions produced by GK SOFTWARE AG in Europe and the MENA regionMobile till on the iPod successfully used for the first tim
10、e during the Olympic Games in Great BritainNew office in Cologne set up as an archi-tecture and development baseGaining the Valora project to equip approx.2,700 stores in Germany,Aus-tria,Luxembourg and SwitzerlandClearance for sale of the new scales soft-ware called Open Scale for direct and partne
11、r business Retail Technology Award Europe awarded to Parfmerie Douglas for its use of the mobile till on the iPod1.Quarter2.QuarterHighlights 2012 5Gaining the Hammer Heimtex project,the largest special provider of home textiles in Germany with approx.170 storesPresentation of the worlds first SAP H
12、ANA-based POS software solutions at the SAPPHIRE in MadridTakeover of AWEK GmbH,the largest independent provider of IT operating ser-vices for the retail sector in Germany Order from Saudi Arabia project gained together with SAP involving Al Muhaidib,a leading home improvement operator on the Arabia
13、n PeninsulaLaunch of the first mobile payment pilot schemes at two leading retailers in Ger-many GK SOFTWARE AG wins the Sustained Excellence Award 3.Quarter4.Quarter 6Partner for the retail trade 7Partner for the Retail TradeGK SOFTWARE AG supplies leading retailers on the international market with
14、 strategically important software solutions to handle crucial business processes in their stores.GK SOFTWARE AG is a global technology and innovation leader in the growing market for retail IT solutions with its open GK/Retail Business Suite,which runs on any platform and is fully programmed in Java
15、.8Comprehensive software Packages 9GK SOFTWARE solutions allow retailers to effi-ciently operate all the processes related to custom-ers e.g.cash transactions or customer loyalty and related to goods ranging from scheduling to incoming goods and even inventories.The comprehensive range of products p
16、rovides lead-ing market solutions for the central management of stores scattered across international borders and infrastructure solutions to directly link stores to central retail systems.Comprehensive Software Packages 10Successful partnerships 11GK SOFTWARE AG works successfully with interna-tion
17、al partners,which sell the companys software products around the globe and introduce them at customer premises.The partnership with SAP is crucially important and it directly sells five solutions produced by GK SOFT-WARE AG.More than ten joint projects have been gained in just two years as part of t
18、he close cooper-ation arrangement.Successful partnerships 12Successful ProjectsThe use of gk/reTail has enaBled us To achieve lasTing cosTs savings for service and mainTenance as well as implemenT an efficienT cenTral archiTecTure concepT.“August Harder,CIO CoopThe CustomerSwiss retailer with around
19、 1,900 stores in several different sectorsThe ProjectImplementing a homogeneous system in all branch stores across all sectorsThe ChallengeScalable central architecture,standard software to meet all the various sales channels requirements,automated label printing 13Satisfied CustomerswiTh gk/reTail,
20、we have chosen a sTandard soluTion ThaT enaBles us To opTimally inTe-graTe new Business processes and implemenT proJecTs quickly and smooThly.“Hans-Dieter Christ,COO Gries Deco Company GmbHThe CustomerLeading retailer of home accessories,furniture,gifts and decorative itemsThe ProjectStore solution
21、for over 320 branches in Germany and AustriaThe ChallengeRapid roll-out of a standard solution including Payback connection and cen-tral gift-voucher serverstephan kronmllerDeputy CTOandr hergertCFOrainer glCEOmichael JaszczykCTOoliver kantnerCOO15To the Shareholders17 Letter from the Management Boa
22、rd20 Corporate Governance Report 20 Cooperation between the Management and Supervisory Boards20 Transparency20 Risk Management20 Statement of Compliance23 Report by the Supervisory Board26 GK SOFTWARE AG Shares 26 Summary/Shares Performance26 Shareholder Structure27 Directors Dealings in 201127 Inve
23、stor Relations16The reTail secTor is in a period of TransiTion omni-channel will make a massive difference To The general condiTions.“Rainer Gl,CEOTO THE SHAREHOLDERS Letter from the Management Board 17Letter from the Management BoardDear shareholders,After eight successful years of growth,GK SOFT-W
24、ARE has for the very first time experienced a year when it was not possible to achieve the results of the previous year.After sales almost tripled to EUR 31.75 million in the four years after the IPO until 2011,a tough market environment only ena-bled the company to achieve sales of EUR 28.43 millio
25、n in fiscal 2012,which is the equivalent of a decline of about ten percent.The decline is partly due to the failure to attract new customers and partly due to delays in existing projects,which have meant that sales have been realized at a later time than planned.As expected,all this has had an effec
26、t on earn-ings before interest and taxes:the figure for fiscal 2012 was just EUR 0.78 million,following a figure of EUR 6.65 million in the previous year.In line with this,the EBIT margin,related to sales,was 2.8 percent and therefore significantly below our expectations.As a result,annual net incom
27、e totaled EUR 0.67 million.Despite the tough overall situation in our markets,we are not satisfied with what has been achieved,but assume that we have created the basis for continuing our growth pro-cess during the next few years.The causes for the discontinuation in our growth path were varied.Desp
28、ite the ongoing excellent business situation in the retail sector,only very few orders for projects of interest to us were placed in our core markets in 2012.In addition,major retail-ers are combining their store investments with new elements,in contrast with previous years.In the light of the ongoi
29、ng increase in Internet trade,the ever greater use of mobile commerce and new issues like home delivery or recommendation mar-keting,more and more projects are designed in such a way that they can provide all-round solu-tions for omni-channel retailing.Because of a short-age of experience and rapidl
30、y changing possible future scenarios,we experienced an extension in sales cycles in 2012 and therefore a postpone-ment of dates on which final decisions were made.We assume that this trend will continue until there is more clarity about the design of omni-channel retailing and initial best practice
31、helps to overcome the uncertainties that exist.Another factor for the earnings situation in 2012 was that the interna-tional business,which we are expecting as a result of our partnership with SAP,did not yet play such a strong role.This is partly due to the general trends described above,which also
32、 have an inter-national dimension,and also because sales at SAP are experienced at least just as long sales cycles as our direct sales,which normally last between at least 12 and 18 months.However,SAP was able to gain three important projects last year where GK SOFTWARE solutions are being used.This
33、 shows that the partnership is alive and well.An important event for the company was the successful takeover of the AWEK Group in Decem-ber.The AWEK Group is the largest independent provider of 1st and 2d level support services and nationwide field services for the retail sector in Germany.As a resu
34、lt,it ideally supplements our range of services for the retail trade.The AWEK Group is also a software supplier for major Ger-man retailers like Globus,the book wholesaler KNV and Strauss Innovation,which were not GK SOFTWARE customers in the past.The AWEK Group recorded sales of EUR 11.9 million in
35、 2012.We are convinced that AWEK will make a positive contribution to the companys results following a restructuring phase during business year 2013.The operating results achieved by GK SOFT-WARE in fiscal 2012 were based on the scheduled completion of existing projects and gaining new customers.The
36、 sales basis was enlarged by the approval of two other company solutions for SAP sales in more regions(Open Scale,Label&Poster Print).As a result,SAP now sells five software solu-tions from GK SOFTWARE as part of its SAP Store Solutions by GK.Despite the tough general market conditions with few orde
37、rs placed for projects in fiscal 2012,we were able to gain new customer projects.At the start of the year,SAP was able to gain a new customer for SAP Point-of-Sale by GK“in the shape of Valora.It will equip approx.2,700 busi-ness sites in the German-speaking world and Lux-TO THE SHAREHOLDERS Letter
38、from the Management Board18embourg as part of this project.A leading home improvement store,Al Muhaidib,with 180 markets in Saudi Arabia and the GCC countries(Bahrain,Kuwait,Oman,Qatar and the United Arab Emir-ates)opted for the SAP Point-of-Sale by GK“and SAP Offline Mobile Store by GK“.This enable
39、d us to gain our first joint customer in the MENA(Middle East&North Africa)growth region.In terms of direct sales,we were able to persuade Hammer Heimtex,the leading German operator of markets for home textiles,to purchase our point-of-sale software.In this project one of the few orders placed in Ge
40、rmany in 2012 we will sup-ply the software for approx.170 retail markets.The Dohle trading group decided to buy SAP Offline Mobile Store by GK“,SAP Store Device Control by GK“and SAP Label&Poster Print by GK“at the end of the year.This was the first sales success for our software for automatic label
41、 print-ing,which has been newly included in the SAP sales arrangement.The Dohle trading group uses the HIT brand to operate consumer markets and self-service department stores at about 100 sites in Germany.We were also able to significantly expand the number of installations in 2012.The continuation
42、 of our mass roll-outs at major customers,the reduc-tion in different national versions and the produc-tive introduction of new projects were the reason for this.Overall,approx.34,300 new systems(e.g.tills,mobile devices,servers)were equipped with our solutions last year.They included installa-tions
43、 in Ukraine for the first time.As a result of the takeover of AWEK,the number of productive instal-lations increased by 15,800,with the result that we are currently responsible for maintaining approx.164,000 productive systems in 35 coun-tries.Business developments in existing projects were earmarke
44、d by two main factors in fiscal 2012.Our existing customers are continuing to switch to the latest major release 12 in large numbers and there-fore demonstrate their confidence in the quality of our software products.Alongside this,nearly all our existing projects generated further sales,as our cust
45、omers are continually adapting to new requirements in their business and some of them have opted for other solutions within our portfolio.We developed new solutions as part of our research and development work in 2012,inte-grated the latest technologies in our portfolio and continued to develop our
46、GK/Retail business suite at a functional and architectural level.One major issue here is the omni-channel integration,i.e.cre-ating the conditions for a consistent sales approach for consumers along different sales channels,regardless of which device is used.Open Scale and Label&Poster Print have su
47、ccess-fully obtained premium qualification within our partnership with SAP and have therefore been cleared for sale by SAP.We developed a solution known as GK/Retail Self Checkout for scanning and cash processes for consumers,regardless of which hardware is used,in 2012 and this has already been put
48、 into pilot operations at one large customer.Our mobile till has been ported to the iPad natively and is therefore available as another option.Our solutions are the very first by a provider of store software to have been made suitable for HANA operations in conjunction with SAP so that customers can
49、 benefit from the advantages of in-memory databasing.We have also made impor-tant server components suitable for use in cloud environments and have therefore created the important technological basis for omni-channel retailing.Within this field,our POS solution was also certified by SAP for business
50、-by-design and can therefore now be used in modern cloud sce-narios.We were able to sign an expanded service sup-port agreement with HP at the beginning of 2013 as an important precondition for developing our international business;as a result,HP will make available extensive after-sales solutions s
51、ervices for SAP Store Solutions by GK“so that customers around the globe have a qualified implementation and service partner,which will enable projects involving SAP Store Solutions by GK to be intro-duced in a fast and flexible manner.The value of our shares declined somewhat dur-ing the reporting
52、period and was not able to bene-TO THE SHAREHOLDERS Letter from the Management Board 19fit from the general upward trend on the capital markets.The value of the GK SOFTWARE share at the end of 2012 was EUR 36.60 and was there-fore 8.5 percent lower than at the beginning of the year.Based on an excel
53、lent pipeline both in our direct and partner sales,we are confident that we will be able to return to our pathway of growth in 2013 again.We are currently involved in detailed dis-cussions with customers both in Germany and abroad and believe that we are in a very good position to emerge as the winn
54、er of several tender procedures.We therefore assume that,if business goes well in 2013,we will be able to continue to increase sales in comparison with the previous year and return to our former level of profitability.This fore-cast is naturally subject to the proviso that no extraordinary events ta
55、ke place,which would lead to a negative impact on the overall economy or the retail sector.We are delighted that you are supporting the process of growth at GK SOFTARE AG and would like to thank you for placing your long-term confi-dence in the company.Oliver Kantner(COO)Rainer Gl(CEO)Andr Hergert(C
56、FO)Michael Jaszczyk(CTO)The Management BoardTO THE SHAREHOLDERS Corporate Governance Report 20Corporate Governance Report according to Section 289a of the German Commercial CodeGK SOFTWARE views responsible and transparent performance as absolutely essential for the long-term economic creation of va
57、lue.Both the Man-agement and Supervisory Boards have provided the statutory statement of compliance according to Section 161 of the German Stock Corporation Act.It is an important task for the Management and Supervisory Boards to monitor whether this state-ment is being followed.The statement is sub
58、mitted every year and is available to the public on the Internet at http:/investor.gk- under the“Corporate Governance”section.Cooperation between the Manage-ment and Supervisory BoardsThe Management Board works with the Supervi-sory Board based on a relationship of Trust since many years.The Managem
59、ent Board provides reg-ular reports to the Supervisory Board about the profitability and strategy of the Group and imple-menting these plans,but also about existing and possible risks in developments,and not just during the normal Supervisory Board meetings,which were held three times in the past ye
60、ar,but also in regular meetings directly to the Chairman of the Supervisory Board each month,as a general rule.You can find more on this in the report from the Supervisory Board.Because of its composition(just three members),the Supervisory Board did not form any committees and all the subject matte
61、r was discussed and decisions were made by the full body.The Chairman of the Supervisory Board is solely entitled to conduct negotiations for human resources decisions related to the Management Board,but these negotiations have to be author-ized by the whole body.There were no conflicts of interest
62、for members of the Management and Supervisory Boards.TransparencyGK SOFTWARE deliberately decided to have its IPO in the summer of 2008 listed on the most strin-gently controlled segment of the German Stock Exchange,the Prime Standard.The highest possi-ble degrees of transparency towards its investo
63、rs and all the other participants in the capital markets have been some of the most important principles at the company from the outset.The company will appoint a voting proxy for the 2013 annual shareholders meeting too and this will allow shareholders to exercise their voting rights even if they c
64、annot attend the meeting.All the public information,like obligatory announce-ments and press releases,the financial statements or the reports on the main shareholders meeting will be made available on the companys website.Risk ManagementThe risk management system established by the company is geared
65、 towards the needs of the busi-ness.It is designed to recognize risks at an early stage and help prevent or restrict risks that occur.We would refer you to the group management report for further details.Statement of ComplianceSection 161 of the German Stock Corporation Act obliges the Management Bo
66、ard and the Supervi-sory Board at GK SOFTWARE AG to make an annual declaration that compliance has been or is being achieved with regard to the recommenda-tions of the“Government Commission on German Corporate Governance Code”published by the German Minister of Justice in the official section of the
67、 electronic German Federal Gazette,or to state which recommendations have not been or are not being complied with.This declaration must be made available to shareholders at all times.The last annual declaration was submitted in April 2012 and relates to the version of the Code dated 26 May 2010 for
68、the past.The future prac-tices related to corporate governance at GK SOFTWARE will refer to the recommendations TO THE SHAREHOLDERS Corporate Governance Report 21in the Code in the current version dated 15 May 2012.The Management and Supervisory Boards at GK SOFTWARE AG declared on 12 April 2013 tha
69、t the recommendations of the“Government Commission on German Corporate Governance Code”had been satisfied since the release of the last annual statement of compliance in April 2012 with the exceptions noted in the declaration in April 2012 and is being met with the following exceptions.Code Number 2
70、.3.4 The company will not provide any Internet webcast of the annual shareholders meeting,as the Management and Supervisory Boards believe that this would not create a higher participation level at the annual shareholders meeting.Code Number 4.1.5 The candidates for man-agement functions will be sel
71、ected by the Man-agement Board on the basis of their personal skills and abilities in the interests of the com-pany.When making selections,the objective backgrounds of the candidates in terms of their age,background or sex are not taken into account.Code Number 4.2.4 The company does not indicate th
72、e earnings of the members of the Management Board in the annual accounts by name.The total earnings of the members of the Management Board are disclosed.This depar-ture based on the decision taken by a qualified majority of three quarters of the share capital represented at the annual shareholders m
73、eet-ing at the meeting held on 17 June 2010 according to Section 286,Paragraph 5 HGB and Section 314,Paragraph 2,Sentence 2 HGB ruled that the individual earnings should not be published in the annual and consoli-dated accounts from 2010 until 2014.Code Number 5.1.2 The Supervisory Board will exclus
74、ively take into account the personal suitability arising from the candidates individ-ual abilities and skills when appointing people to vacant positions on the Management Board,as this will lead to the best results for the com-pany.Objective criteria like age,background or sex will not be included i
75、n any considera-tions.There is no age limit for members of the Management Board;in the view of GK SOFT-WARE AG,the professional qualifications of the members of the Management Board play a more important role.Code Number 5.3 In a departure from Num-ber 5.3 of the Code,the Supervisory Board at GK SOF
76、TWARE AG does not form any com-mittees,as consistent,extensive information for all the members of the Supervisory Board can be guaranteed most efficiently in meetings where all the members of the Supervisory Board are present(the Supervisory Board con-sists of only three members).Any issues can be h
77、andled and answered appropriately by the whole body.So no auditing committee(Num-ber 5.3.2)has been set up.The same applies to the nomination committee(Number 5.3.3)or other specialist committees(Number 5.3.4).The responsibilities normally assumed by the specially appointed committees are handled by
78、 the full committee,as the committee has the necessary qualifications to handle these.Code Number 5.4.1 The composition of the Supervisory Board at GK SOFTWARE AG is not subject to the Supervisory Board,but the companys annual shareholders meeting.The Supervisory Board seeks to engage in success-ful
79、 cooperation between its members and con-structive cooperation with the Management Board.The proposals for candidates,whom the Supervisory Board submits to the annual shareholders meeting,will take into account the geographical distribution and the degree of complexity of the business at GK SOFT-WAR
80、E.Criteria like the age,background or sex of the candidates will not be taken into consideration.There is no provision for an obligatory age limit for the members of the Supervisory Board,as the older members of the Supervisory Board in particular enrich the body as a result of their wide experience
81、,and their specialist qualifications are of greater importance.TO THE SHAREHOLDERS Corporate Governance Report 22 Code 5.4.6 Payments for the members of the Supervisory Board are made exclusively according to fixed elements.No remuneration that is dependent on the companys success is granted to the
82、members of the Supervisory Board,as the members of the Supervisory Board must be able to pursue their tasks as a supervisory body for the company without any possible conflict of interests.Code 7.1.2 The consolidated accounts are not published within 90 days after the end of the fiscal year,but afte
83、r four months in line with the current guidelines published by Deutsche Brse AG.The interim reports are not made available within 45 days,but after two months according to the current guidelines published by Deutsche Brse AG.GK SOFTWARE AG believes that the periods of time set by Deutsche Brse AG ar
84、e adequate to provide shareholders with suf-ficient information.TO THE SHAREHOLDERS Report by the Supervisory Board 23Report by the Supervisory BoardDear shareholders,I would like to present to you the report prepared by the Supervisory Board at GK SOFTWARE AG for fiscal 2012;it reflects a far less
85、successful year than in all the previous years since the IPO.Composition of the Supervisory BoardAccording to the articles of incorporation,the Supervisory Board consists of three members.In fiscal 2012 they were:Uwe Ludwig(Chairman)Thomas Bleier(Deputy Chairman)Herbert Zinn Mr.Ludwig and Mr.Zinn ha
86、ve both been appointed until the end of the annual sharehold-ers meeting in 2016,while Mr.Thomas Bleiers appointment ends with the conclusion of the annual shareholders meeting in 2014.MeetingsThe Supervisory Board met for normal sessions on 16 April 2012,20 August 2012 and 26 Novem-ber 2012.Decisio
87、ns were also taken during a tele-phone conference on 6 June 2012.All the mem-bers of the Supervisiory Board took part in the nor-mal meetings without the meeting from 20 August where one member was absent for health reasons.It ist GKs practice that representatives of the Man-agement Board were prese
88、nt at the normal ses-sions too.The members of the Supervisory Board were also regularly in contact with each other out-side the meetings and the Chairman of the Supervisory Board in particularly also maintained contact with the Management Board.Decisions were made during meetings or by a circulation
89、 procedure.During its meetings the Supervisory Board received both verbal and written reports from the Management Board about the business and financial situation within the company and about the fundamental business policy.Tasks of the Supervisory BoardThe Supervisory Board at GK SOFTWARE AG ful-fi
90、lled for the fiscal year 2012 the tasks incumbent upon it according to the law,the articles of incor-poration,the recommendations of the“German Corporate Government Code”government com-mission and the Supervisory Boards rules of inter-nal procedure and monitored company managers continually.The ongo
91、ing development and adjustment of the risk management systems was a constant issue.The Supervisory Board also acquired information about the progress in introducing the security con-cept and the further establishment of formalized administrative processes and new controlling pro-cesses.The Superviso
92、ry Board welcomed the pro-gress made and the fundamental overhaul of the planning processes,the internal accounting sys-tem,which have both been started,and the further Uwe Ludwig,Chairman of the Supervisory BoardTO THE SHAREHOLDERS Report by the Supervisory Board24revising and combining of the exis
93、ting key data systems.The Supervisory Board continously focussed on the appropriateness of the salaries paid to mem-bers of the Management Board.Attention was paid like the previous years to the way that sala-ries related to the companys economic situation and conditions existing at other companies,
94、the comparison between the total structure of salaries within GK SOFTWARE and the combination of fixed and variable parts of salaries.There was no need to make any adjustments.The discrepancies from the economic goals that were encountered during fiscal 2012 have per-suaded the Supervisory Board not
95、 to allow the var-iable parts of the salaries to be fully paid out to the members of the Management Board.In order to monitor the company managers,the Supervisory Board was guided by the annual budget passed for 2012 and particularly asked the Management Board to report on the current business polic
96、y and corporate planning,profitabil-ity,the course of business and major individual steps taken by the company.The Supervisory Board called for additional reports and informa-tion following the complete surprise in the fourth quarter when sales and results slumped,after the goals that had been coord
97、inated for the financial year suddenly seemed unrealistic.Because the envisaged takeover of a company,which is well suited to ongoing developments at GK SOFT-WARE AG,did not take effect until the end of the year,it was only possible to achieve the desired effects from this to a minor extent.The Supe
98、rvisory Board was verbally informed about the takeover in The Supervisory Board of GK SOFTWARE AG:from left to right Herbert Zinn,Heinrich Sprenger(Board Member 2001(2011),)Thomas Bleier,Uwe Ludwig(Chairman)TO THE SHAREHOLDERS Report by the Supervisory Board 25general and the operating effects on bu
99、siness for the remainder of 2012 at frequent intervals.Both during its meetings and outside them,the Supervi-sory Board was supplied with information from the Management Board during the whole year,but particularly in the critical situation at the end of 2012;the Supervisory Board discussed and chec
100、ked this information critically.Corporate GovernanceThe Supervisory Board and Management Board act in the full knowledge that good corporate gov-ernance forms an important basis for the compa-nys success and is in the best interests of share-holders and equity markets.The Management Board and the Su
101、pervisory Board issued their annual declaration of compliance in line with Sec-tion 161 of the German Stock Corporation Act in April 2013.The wording of this is printed in this business report as part of the Corporate Govern-ance report.The Management Board and the Supervisory Board have pledged to
102、the relevant degree to follow the recommendations of the Ger-man Corporate Governance Code.No conflicts of interest arose in members of the Supervisory Board during fiscal 2012.2012 Annual Accounts AuditThe GK SOFTWARE AG annual accounts com-piled by the Management Board in line with the rules of th
103、e German Commercial Code and the IFRS Consolidated Accounts and each situation report have been audited by the auditing com-pany,Deloitte&Touche GmbH,and were given an unqualified audit certificate.Taking into account these auditing reports,the Supervisory Board has examined the annual accounts com-
104、piled by the Management Board,the consolidated accounts,the dependency report,the situation report at GK SOFTWARE AG and the Group and checked the suggestion made by the Management Board for the use of the balance sheet profits.Dur-ing its meeting on 22 April 2013,the Supervisory Board asked the Man
105、agement Board to explain the 2012 annual and consolidated accounts and report on profitability,the companys equity,the current course of business and the companys situ-ation.All the Supervisory Board members received the necessary documents duly prior to this meet-ing.The auditor commented on the Ma
106、nagement Boards verbal presentation of the accounts and explained the audit findings using the auditors reports and answered every question on these reports.The auditor was able to satisfactorily answer all the questions.There are no doubts about the auditors independence.During its meet-ing on 22 A
107、pril 2013,the Supervisory Board approved the annual accounts for GK SOFTWARE AG and authorized the consolidated accounts at GK SOFTWARE.As a result,the annual accounts have been approved.The Supervisory Board also agreed to the Management Boards suggestion on how to use the balance sheet profits.The
108、 Supervisory Board also prepared a report on relations to associated companies in line with Section 312 of the German Stock Corporation Act.The auditor checked this and provided a verbal report on the results of his audit during the balance sheet meeting on 22 April 2013.Checks made by the Superviso
109、ry Board did not give rise to any rea-sons for objections to be raised.He did not have any objections to the Management Boards final declaration in his report in line with Section 312 of the German Stock Corporation Act.The Supervisory Board would like to thank the Management Board and every member
110、of staff for their commitment to the company and the work that they have performed and wishes them all an immediately return to the path of success.Schneck,22 April 2013Uwe Ludwig(Chairman of the Supervisory Board)35025030020015050100TO THE SHAREHOLDERS GK SOFTWARE AG Shares 26GK SOFTWARE AG Shares
111、Basic dataBasic data Securities Identification Number(WKN)757142ISINDE0007571424Trading symbolGKSGK SOFTWARE AG IPO19 June 2008Type of sharesOrdinary stock in the name of the holder without any nominal value(individual share certificates)Trading marketsFrankfurt and XETRAMarket segmentRegulated Mark
112、et(Prime Standard)Designated SponsorICF Kursmakler AGNumber of shares1,790,000Share capitalEUR 1,790,000Free float42.49%Highest price in 2012EUR 44.00(9 Feb./3 April 2012)Lowest price in 2012EUR 33.50(11 December 2012)Summary/Shares PerformanceGK SOFTWARE AG shares listed on the Prime Standard secti
113、on of the Frankfurt Stock Exchange followed the general trends during the first half of fiscal 2012 and initially moved upwards and then fell back in line with the trend encountered on the major indices.The share price parted company with these trends in about the middle of the year and maintained i
114、ts value,although it increased sig-nificantly again during the fall for a short period.The share was worth EUR 36.60 at the end of the reporting period.That corresponds to a market capitalization of approx.EUR 65.5 million at the end of fiscal 2012.Shareholder StructureGK SOFTWARE AG has a very stab
115、le shareholder base,which is enabling the company to develop in the long term in a sustainable manner.The com-pany had the following shareholder structure on the reporting date on 31 December 2012:The founder and CEO Rainer Gl directly held 2.95 percent of the shares.Stephan Kronmller,also a company
116、 founder and the former CTO on the Management Board,directly held 2.23 percent of the shares.52.33 percent of the shares were owned by GK Software Holding GmbH,which was indirectly equally shared by the company partners Rainer Gl and Stephan Kronmller.This meant that 42.49 percent of the shares were
117、 in free float on 31 December 2012.Development of GK SOFTWARE shares in comparison to the TecDax from 19 June 2008 until 31 December 2012,indexed,in percentGK SOFTWARE AGTecDax20082009July2010JulyJulyJuly201320112012EUR 36.60EUR 21.10TO THE SHAREHOLDERS GK SOFTWARE AG Shares 27The company was inform
118、ed about the following holdings in GK SOFTWARE AG,which exceeded or fell below the 3 percent threshold:Mr.Andreas Bremke 3.99 percent (on 16 August 2011)Scherzer&Co.AG,Cologne:5.23 percent(on 6 March 2012)Directors Dealings in 2011Members of the Management Board or the Super-visory Board did not car
119、ry out any transactions with GK SOFTWARE AG shares during 2012.Investor RelationsGK SOFTWARE AG deliberately opted to have its shares listed on the most strictly regulated sector of the Deutsche Brse,the Prime Standard,for its IPO in the summer of 2008.From the outset,the high-est levels of transpar
120、ency towards its investors and all the other capital market participants have been some of the most important principles at the com-pany.Andr Hergert,the CFO,is responsible for the investor relations business and he has his own department that reports to him.This guarantees that any enquiries from i
121、nvestors and potential investors are answered immediately.GK SOFTWARE AG also attaches great impor-tance to providing an ongoing flow of information for the future.Among other things,this means draw-ing up quarterly,half-yearly and annual business reports in German and English,publishing a finan-cia
122、l calendar and promptly publishing ad-hoc reports and corporate news items.The accounting system has been adapted to the international IFRS accounting standards and this meets investors needs for information.As in previous years,GK SOFT-WARE AG is also planning to hold its annual analyst conference
123、for 2013 during the Frankfurt Equity Cap-ital Forum.Investor and press road shows also take place at regular intervals so that the company remains in permanent contact with the capital mar-kets.The Management Board also prepared a report about relationships to associated companies in line with Secti
124、on 312 of the German Stock Corporation Act.The auditor checked this and gave a verbal report on the results of his findings to the meeting held on 22 April 2013.Checks made by the Supervisory Board did not lead to any grounds for objections.It did not have any objections to the Management Boards fin
125、al conclusions in its report prepared according to Section 312 of the German Stock Corporation Act.The Supervisory Board thanks the Management Board and all staff members for their commitment and the work they have done,wishing them the best of ongoing success for 2013.Shareholder structure at GK SO
126、FTWARE AG on 31 Dec.2012GK Software Holding GmbHFreefloatStephan KronmllerRainer Gl52.33%42.49%2.23%2.95%1.79 MioShares29Consolidated Annual Report30 Business Report30 Business and General Conditions at GK SOFTWARE47 Explanation of the Business Results and an Analysis of the Assets,Financial and Ear
127、nings Situation52 Report on Key Events after the Balance Sheet Date53 Report on Risks and Prospects at GK SOFTWARE53 Risks 56 Opportunities 57 Outlook58 Other Information According to Section 315 of the German Commercial Code58 Principles of the Companys Remuneration SystemCONSOLIDATED ANNUAL REPORT
128、 Business Report30Business ReportBusiness and General Conditions at GK SOFTWARECorporate Structure and Holdings Eight business locations in Europe and sales branches in the USA and Russia Both company founders are actively involved in the companyGK SOFTWARE AG is one of the worlds leading technology
129、 companies for retail software with a special focus on providing solutions for corpora-tions with local stores.GK SOFTWARE AG and its predecessor company,G&K Datensysteme GmbH,which Rainer Gl and Stephan Kronmller founded in 1990 and which became GK SOFT-WARE AG in 2001,have now been operating in th
130、e market place for 23 years.The companys IPO took place in the Prime Standard segment of the Frankfurt Stock Exchange in 2008.The companys headquarters has been located in Schneck/Vogtland since it was founded.The company has its product development department,project management and third-level supp
131、ort facilities at this base in addition to administration services.SQ IT-Services is also based at this location.It was founded in 2009 to handle the takeover and integration of Solquest GmbH.Schneck is also home to 1.Waldstrae GmbH which was set up in preparation for the launch of new business acti
132、vities and is also a 100 percent subsidiary of GK SOFTWARE AG.GK SOFTWARE AG has a branch next to Checkpoint Charlie in Berlin and it is primarily responsible for managing the marketing,sales and partner activities;the companys user-help desk is also based there.The Groups second largest business lo
133、cation has now been located in Plzen in the Czech Republic for more than ten years.The 100 percent subsidiary,EUROSOFTWARE s.r.o.,is home to the software production and research&development work.Major work on programming and techno-logical further developments for the solutions pro-OOO GK Software R
134、US100%100%100%100%100%100%100%100%100%StoreWeaver GmbHEUROSOFTWARE s.r.o.Economically inactive legal unitsSQ IT-Services GmbHAWEK GmbHAWEK microdata GmbHAWEK C-POS GmbHAWEK Hong Kong Ltd.Group structure of GK SOFTWARE AG9616211215553840373214214220122011CONSOLIDATED ANNUAL REPORT Business Report 31v
135、ided by GK SOFTWARE AG take place at the Plzen base.GK SOFTWARE AG has another 100 percent subsidiary in Switzerland.The StoreWeaver GmbH will move to Dbendorf near Zurich in business year 2013.This company has a German base in the state of Saarland in St.Ingbert.The teams in St.Ingbert are responsi
136、ble for the onward development of the StoreWeaver EE product group and handling the relevant customer projects;and they also look after the customers of the former Solquest GmbH company.The company has acquired two more business centers through the takeover of AWEK GmbH on 10 December 2012.The admin
137、istration,hotline,dispatching,quality assurance,repairs and stores are located in Barsbttel near Hamburg,while the software development department is based in Bielefeld.The service organization at AWEK also consists of mobile technicians who are spread across the different parts of Germany.GK SOFTWA
138、RE has its own sales organizations in the USA and in Russia.The three-man GK SOFTWARE AG Supervisory Board is led by the Chairman Uwe Ludwig.He has been a member of the Supervisory Board since 2001.Thomas Bleier was elected to the Supervi-sory Board in 2003 and Herbert Zinn in 2011.Distribution of e
139、mployees at group business locations1on 31 December 2012Zurich/St.IngbertPlzenBerlinSchneckCologneBielefeldHamburg1 Without the members of the Management Board and Trainees.One other employee works at the branch in Moscow and is not shown here.32CustomerThe customer-related business processes includ
140、e the complete till operations,cash accounting,handling all kinds of gift cards and cou-pons and issuing or accepting bonus points as part of discount systems like Payback or Lufthansa Miles&More.The software package provided by GK SOFTWARE is different from those of its competitors,primarily becaus
141、e it is more technologically advanced,has a broad range of functions and can be used in international contexts.GoodsThe software solutions related to goods were extended to a considerable degree in 2012.They include store merchandise management business processes ranging from inventories to scheduli
142、ng or stocks and even automatic label printing.GK SOFTWARE has the expertise to dovetail processes in stores with those of a leading central ERP system(like SAP)and make this available in full to mobile units.Solutions for modern advertising in retail stores on a wide variety of digital displays als
143、o form part of this.Products and Services33ManagementThe software solutions designed to manage The software solutions designed to manage the most complex store structures distributed the most complex store structures distributed across international frontiers are one signifi-across international fro
144、ntiers are one signifi-cant unique selling point for GK SOFTWARE cant unique selling point for GK SOFTWARE in its market environment.They enable the in its market environment.They enable the companys customers to centrally manage companys customers to centrally manage thousands of stores in very man
145、y countries thousands of stores in very many countries using different languages,currencies or time using different languages,currencies or time zones.This is extraordinarily important for zones.This is extraordinarily important for local structures as found in store systems in local structures as f
146、ound in store systems in the retail sector,as each till,each printer or the retail sector,as each till,each printer or even each pair of scales is a critical system even each pair of scales is a critical system for business purposes.for business purposes.InfrastructureGK SOFTWARE not only supplies t
147、he leading front-end software for users in stores and enterprise headquarters in the retail sector.The companys software solutions are also setting standards for the sector in the field of technical infrastructure.GK SOFTWAREs Store-Weaver system provides an integration platform in order to seamless
148、ly network its own and outside software solutions in a store and link them to central systems like ERP or CRM processes.The solutions provided by GK SOFTWARE provide smooth operations in retail stores.They include a variety of processes related to customers,goods,the technical management of store st
149、ructures and the availability of tech-nical infrastructure for large local IT landscapes.It is particularly important that the complete software package is contained in a reusa-ble standard product and each new customer pro-ject can be based on this.This prevents project islands that deviate from th
150、e standard product and product developments can be passed on to existing customers in ongoing sales cyclesProducts and ServicesCONSOLIDATED ANNUAL REPORT Business Report34Human Resources Human resources growth due to the takeover of the AWEK-Group New branch in Cologne Trainee and further training p
151、rograms for the members of staff 450 people were employed within the Group on the reporting date of 31 December 2012(excluding the AWEK members of staff,members of the Man-agement Board and trainees).As a result,22 more people were employed compared to the reporting date in the previous year on the
152、same basis(428).This represents a growth rate of 5.1 percent.Rein-forcements were hired for 2d level management positions and more people were added to the pro-ject management and software development departments.The takeover of AWEK in December 2012 means that the workforce has increased by another
153、 112 people.As a result,the Group employed 562 people on the reporting date.The majority of the Groups members of staff(211)are employed at corporate headquarters in Schneck(215 in the previous year).The Berlin branch has now 37 members of staff working in the sales&marketing,project and partner man
154、age-ment,development and first-level support(hotline)departments.There was no change in the number of people employed at the Czech subsidiary EURO-SOFT-WARE s.r.o.in Plzen;as a result,142 people were employed there at the end of the reporting period the same figure as in the previous year.96 people
155、were employed at AWEK in Ham-burg at the end of the year,including many mobile service technicians,who are deployed at various places across Germany.16 people were employed at the second business center in Biele-feld at the end of 2012;they work in the software development field.53 people were worki
156、ng at the St.Ingbert busi-ness center at the end of the year(38 in the previ-ous year).2 people were working in Riehen(Schwitzerland)at this time.The business center in Cologne was newly opened at the beginning of 2012 in order to bene-fit from the good human resources market environ-ment in this re
157、gion.There were already 4 people employed at this branch at the end of the reporting period.1 person was employed at the branch in Russia and one freelancer in the USA at this time.The Management Board expects the growth in employees to continue at a moderate pace in the future and the company will
158、primarily continue to look for people with fairly high qualifications.Huge investments have been made in training and developing employees for years in order to be able to provide a foundation for and boost sales growth at GK SOFTWARE AG from a human resources point of view too.The successful one-ye
159、ar trainee program designed to deliberately establish qualified employees was continued and 1 member of staff is participating in this at the moment.5 trainees are also currently employed at GK SOFTWARE AG.The GK SOFTWARE Software Solutions GK SOFTWARE The Retail Application Company New GK/Retail Se
160、lf-Checkout software developed New management information KPI Dash-board on iPad GK SOFTWARE views itself as a provider of retail applications,i.e.end-to-end and complete soft-ware solutions for the retail trade,which satisfy all the requirements without the need for any outside software.We have bee
161、n satisfying this aspiration since 2013 with the new claim:“GK SOFTWARE The Retail Application Company.”Behind this claim stands an open architecture model,the four levels of which enable various types of software to CONSOLIDATED ANNUAL REPORT Business Report 35join forces for the different sales ch
162、annels.Each application uses the same components and mod-ules so that the development work is reduced and this also prevents any expensive parallel develop-ment work.The Operations layer,which provides the fundamental basis for each application,forms the GK/Retail Infrastructure together with the Co
163、mmunications layer,which guarantees the complete exchange of information and data.This means methods and procedures that have been tried and tested in more than 165,000 installations are available for each of the different GK applica-tions and they safeguard the technical operations.The Retail Busin
164、ess Logic,which is formed by Core Retail Processes and Enhanced Retail Processes,builds on this infrastructure.While the core processes are mapped end-to-end by GK SOFTWARE,software modules provided by partner companies can also be used with the enhanced processes,as is specifically practiced in the
165、 cooperation arrangement with SAP.The previously defined components of the vari-ous levels are linked to each other for the relevant fields of application and are packetized into fin-ished applications,which are available for various channels like the store,web store links or mobile retailing.Soluti
166、ons for new channels or for integrat-ing social media,for example,can be introduced on the identical architectural platform without the need to permanently redevelop the basis for the software each time.Using this flexible and for-ward-looking platform,GK SOFTWARE has an excellent starting position
167、to handle current and future issues like omni-channel retailing,cloud com-puting or in-memory databasing.The various GK SOFTWARE products are brought together in the GK/Retail Business Suite with their concrete specifications for the market place.All the solutions are fully based on the GK/Retail in
168、frastructure and selected core and enhanced processes,on Java and on open stand-ards.That means that they operate end-to-end,regardless of which hardware and operating sys-tems are used.GK SOFTWARE is currently selling Version 12 of the GK/Retail Business Suite.The GK/Retail Business Suite is arrang
169、ed on two main pillars.One of them involves the StoreWeaver Enterprise 36we have an ouTsTanding markeT posiTion wiTh our reTail applicaTions archiTecTure To meeT all The currenT and fuTure requiremenTs.“Michael Jaszczyk,CTOCONSOLIDATED ANNUAL REPORT Business Report 37Edition(EE).The other one covers
170、 the Store Operations.StoreWeaver Enterprise EditionStoreWeaver Enterprise Edition comprises the Store Device Control and Mobile Store Processes components.It is closely linked to the solutions in the Store Operations area,but can be used in complete isolation from this.GK/Retail Store Device Contro
171、l provides the end-to-end link within the complete store peripheral equipment,for instance,tills,scales or automatic empties machines.The software handles the automatic distribution of data to all the systems in a store with a direct link to the leading SAP system.This guarantees that any changes to
172、 master data(e.g.prices)are avail-able on the correct system within the store at the right time.At the same time,the software ensures that the central systems are supplied with what is known as transaction data(e.g.sales data).The link for the various subsystems in a store is provided through standa
173、rdized peripheral heads,on to which solutions from different manufacturers can be docked.The Enterprise Storemanager guarantees the cen-tral management of the overall systems land-scape.The Enterprise Cockpit handles the mon-itoring work across the systems.Both solutions can also be used outside the
174、 StoreWeaver Enterprise Edition in the field of Store Opera-tions.The complete software component is sold by SAP under the name“SAP Store Device Con-trol by GK”.GK/Retail Mobile Merchandise Manage-ment Processes covers the store management processes,which can be made available directly to mobile ter
175、minals on the floor of the store or in the stock area.The processes,which can be provided online or offline,rely on a leading central system like SAP.They allow the stores to be linked end-to-end with enterprise headquarters in almost real time and manage all the necessary business processes like de
176、liv-eries,merchandise planning,inventories or automatic label printing.This software component is sold by SAP under the name“SAP Offline Mobile Store by GK”.Store OperationsThe GK/Retail Store Operations software provides solutions for use in stores and enterprise headquarters in the retail trade.Th
177、ey are designed to handle all the business processes at tills,shelves,in the stock areas or the back office in the best possible way and manage and monitor complex store structures from enterprise headquarters.All the software solutions are coordinated with each other and can be used by customers as
178、 a complete package or separately.The following solutions form part of this product line:GK/Retail POS is the market-leading solution for operating till systems.The application gua-rantees secure handling for all business proces-ses at tills(POS=point of sale)and provides extensive back office funct
179、ions for managing money,store administration or reporting purpo-ses.A special edition of this software can also be used for self-checkout systems.SAP sells the software under the name“SAP Point of Sale by GK”.GK/Retail Mobile POS is an innovative soft-ware solution for till use on devices using the
180、iOS operating system(iPhones,iPods,iPads).The company software handles all the proces-ses available on stationary tills and is already used by an important customer it in a produc-tive environment.Mobile POS is available as specific individual developments for iPods/iPhones and iPads.GK/Retail Self
181、Checkout is an enhancement of our POS software and was newly develo-ped in 2012.It is fully based on our standard software and enables consumers to handle all the till processes themselves.Together with the associated iOS app,consumer advisers can immediately respond to demands during the till proce
182、ss,e.g.age identification when purchasing alcoholic drinks,and they can offer consumers help and support quickly,if requi-red.CONSOLIDATED ANNUAL REPORT Business Report38 GK/Retail Open Scale is a new software solution within the GK/Retail Business Suite.It is based on the same technical concepts as
183、 the other software solutions and is a self-contained application for all kinds of open PC scales.It enables the retail sector to use end-to-end IT structures and be free to select scales from any hardware supplier.This software has been certi-fied for use by the PTB(Prftechnische Bundes-anstalt Ger
184、manys National Metrology Insti-tute).GK/Retail Taskmanagement ensures that information can be automatically distributed simultaneously and in a controlled fashion,e.g.regarding recalls of items,corporate-wide announcements or other information.The module,which has been specially designed for the nee
185、ds of companies with many stores,allows a very fast and end-to-end flow of infor-mation and can also be used on mobile units.The GK/Retail Lean Store Server allows all the back office servers to be centralized.This means that an important part of the IT systems can be moved out of the stores to ente
186、rprise headquarters.This opens up considerable potential for store-based corporations,as they can use more powerful servers,for example,and servicing and maintenance costs can be significantly reduced.GK SOFTWARE AG is the worlds leading company for the centraliza-tion of background systems for stor
187、e-based cor-porations.GK/Retail Enterprise Storemanager is the market leading software,which provides admi-nistration and technical monitoring facilities for major store networks,which may operate in different countries.The software allows corpo-rations to manage and monitor thousands of stores in m
188、any countries and is an important unique selling feature of the GK/Retail Busi-ness Suite.GK/Retail Enterprise Cockpit provides managers with a very fast summary of techni-cal and specialist key performance indicators.This means that technical breakdowns in stores are recognized immediately and sale
189、s data(e.g.volumes of sales)can be evaluated in real time.This solution provides corporate-wide transparency with regard to the status of sys-tems in stores and supplies central business management data.GK/Retail Sales Cockpit makes available web-based business management information related to the
190、current days business.This means that managers constantly have a com-prehensive overview of the course of business in real time.GK/Retail KPI Dashboard is a native iPad app,with which important business parameters can be processed for different target groups in various aggregation stages.By using th
191、e KPI Dashboard,branch managers,district and regi-onal managers or enterprise directors can immediately check the relevant data in their working area in real time and use it as the basis for their actions.The KPI Dashboard is designed for use with in-memory technologies and works in conjunction with
192、 SAP HANA,SAPs in-memory appliance,for example.GK/Retail Enterprise Promotions Manage-ment is a complete solution for designing,car-rying out and managing corporate-wide pro-motions and special offers.It can be used,among other things,to manage discounts on customer card systems or the acceptance of
193、 many kinds of coupons at tills.GK/Retail Stored Value Server guarantees secure,corporate-wide administration services for all the gift cards that have been issued.It provides a central database for supplying all the gift card information within the complete corporation and also handles all the proc
194、esses related to electronic gift cards.GK/Retail Digital Content Management is the central software solution for distributing multimedia content to various output devices within the complete corporation.This means that photos,slide shows or videos can be distri-buted to the relevant systems within t
195、he com-pany.The system also allows pure text messa-ges to be sent(e.g.for electronic shelf labels).39The Takeover of awek has significanTly expanded our value-added chain in The field of services.”Oliver Kantner,COOCONSOLIDATED ANNUAL REPORT Business Report40The SQRS Software PackageWhen the company
196、 took over the assets of the for-mer company Solquest GmbH,it also took over its software package Solquest Retail Solutions(SQRS),which is being used by eight customers at approx.10,000 installations.The particular high-performance features of the software lie in the fields of SAP integration and it
197、s mobile solutions.The SQRS software solutions are no longer being sold in order to keep the Groups product portfolio stream-lined.But there are still permanent requirements,which are being handled by StoreWeaver GmbH,to cover existing customer relations.Alongside this,a medium-term migration path h
198、as been developed in order to provide a long-term perspective for the cus-tomers of the former Solquest GmbH company.Product DevelopmentFour minor updates for GK/Retail 12 were released during fiscal 2012 and they have expanded the standard product in line with the road map by providing solution com
199、ponents,func-tions and interfaces to subsystems.More new modules have been developed in addition to the new Mobile POS and Open Scale software and fundamental technological revision work has also taken place.The end-to-end restruc-turing of the software platform and the introduction of the new GUI(G
200、raphical User Interface)were completed for all the modules.They now have a unified,ergonomic and efficient look and feel and this was achieved in conjunction with experienced GUI designers.New components have also been introduced like a central customer repository for corporate-wide enquiries,new ve
201、rsions e.g.of the Sale Cockpit and other taxation law features in line with the roadmap.More specialist require-ments from individual projects like bakery functions have been directly incorporated in the standard product in order to ensure that they are immedi-ately available for other projects.Impo
202、rtant condi-tions have been created by using many defined user exits e.g.for importing and exporting data so that third parties can also expand the GK SOFTWARE solutions by using special custom-ized adaptations.ServicesIn addition to its products,GK SOFTWARE AG also provides comprehensive services.T
203、he most important component in this area involves custom-izing and adapting developments during the initial projects and subsequently introducing change requests,which are a permanent element in most projects.They include,for example,adapting soft-ware that is already in productive use to enhanced r
204、equirements for customers like integrating new bonus systems in the till environment.Classic issues like consulting,project manage-ment or training courses come under the heading of services too.The group worked very hard in 2012 to fulfill the conditions to train implementa-tion partners,which can
205、then handle the introduc-tion of GK/Retail themselves.In the medium term,these partners will primarily handle the basic parameterization work,while development work within the field of adaptation(change requests)will continue to be handled by GK SOFTWARE.Maintenance and servicesThe group has been ab
206、le to supplement its port-folio with high-value services by acquiring AWEK.For the first time it is possible to offer full services for the retail trade in addition to software mainte-nance,which is charged for.This means that GK SOFTWARE can now handle the maintenance of outside software and hardwa
207、re made by a wide variety of manufacturers.About 40 mobile service technicians are available for this work and they can reach any store in Germany within set times.In addition to providing classic services,they can handle other options like rollout services or staging(the initial installation of sys
208、tems).In addition,the group can eliminate errors and faults for all the software solutions that are in use at the customers premises.CONSOLIDATED ANNUAL REPORT Business Report 41Research and Development Research and development as a strategic factor in the face of competitors Further strengthening o
209、f the companys foot-print in the fields of home improvement stores and fashion Focus on new technolgies as part of the part-nership relationship with SAPThe ongoing developing of existing products and the development of new software solutions have been the corporate groups major focus during the pas
210、t few fiscal years and they will continue to be a strategic competitive factor in the future too.This is reflected in the continuing growth in the number of employees in this department.The main part of the research and development department is based at the EUROSOFTWARE s.r.o.subsidiary in Plzen.Cu
211、rrently 14 software developers alone are working to exclusively grapple with the latest trends in the software market in order to develop new,ground-breaking products from these.In order to create independent scope for development alongside the direct research and development activities on direct pr
212、oducts and projects,the company has set up the GK Futurelab,which is being headed by Stephan Kronmller.Highly qualified experts are testing new technologies here,examining trends and new processes and are providing the framework for GK SOFTWARE to continue to act as a powerhouse for innovations for
213、retail IT.Other impulses for research work come from company managers,sales&marketing,partners and directly from GK SOFTWARE AGs customers.The capitalized development costs amounted to EUR 2,046K in 2012(EUR 2,363K in the previous year).The accrual was divided into the capitalized development costs
214、amounting to EUR 748K(EUR 1,489K in the previous year)for work on GK/Retail an the SAP Release 3.0 and the remain-ing amount of EUR 806K as accruals from the own work capitalized entered in the statement under AWEK(EUR 615K in the previous year).Customers and projects Gaining new major international
215、 projects Further strengthening of the companys foot-print in the fields of home improvement stores and fashion Expansion of customer base in the field of mobile solutionsMost of GK SOFTWAREs customers continue to come from the retail sector.The market sectors where the company is active are primari
216、ly the food retail sector,drugstores&household goods,DIY&furniture,fashion&lifestyle or technology&cars.The group provides pre-configured solutions for cash&carry,department stores,discount/food stores,specialist retails and cell phone shops,which are customized to meet the needs of these segments.T
217、he products and services are geared for corporations of various sizes.Important new projects in 2012 a summary:Tally Weijl(approx.700 stores around the globe)Valora(approx.2,700 business sites in Central Europe)Leading sports article producer(mobile till for the Olympic Games in London)Al Muhaidib(a
218、pprox.180 home improvement stores on the Arabian Peninsula)Hammer Heimtex(170 stores in Germany)Dohle(approx.100 consumer markets in Ger-many)after the end of the reporting periodIn the field of existing projects,2012 again saw mass rollouts in several major projects.As a result of these,approx.34,3
219、00 new systems were put into productive use in many countries.The initial phase was completed in several projects as a CONSOLIDATED ANNUAL REPORT Business Report42result.Other existing main customers migrated to the current version of the software during the reporting period or started the changeove
220、r pro-cess.This creates the conditions for ensuring that existing long-term relations with these customers can continue to be reinforced.One example of the vibrant nature of the com-panys partnership with SAP is that there are now six joint customer projects where GK solutions have been sold by SAP.
221、The strategic relations between both companies for the sphere of stores were also reflected in their joint booth at the larg-est European retail trade fair,the EuroCIS in Ds-seldorf,and other coordinated activities.Market and Competitive Environment The retail sector set another record in 2012 sales
222、 rose to EUR 428 billion E-commerce growing most strongly already has a market share of approx.8 per-cent Investment needs for retail IT remain highBusiness developments at GK SOFTWARE AG are determined by several factors and their effects on different economic regions.The most important determinant
223、s are the general economic conditions and the current situation and the expected busi-ness prospects for the retail sector.As GK SOFTWARE expands its business to more and more economic regions,the number of factors increases as a matter of course,as the situ-ation in the individual markets may devel
224、op in very different ways,despite some global economic trends.At the same time,this provides some isola-tion in the companys general operations from the developments in its original core markets primar-43we significanTly expanded The radius of our sales acTiviTies in 2012.“Andr Hergert,CFOCONSOLIDAT
225、ED ANNUAL REPORT Business Report44ily in Central Europe at least in the medium term,without these markets losing their significance for GK SOFTWARE to a large extent in the foreseea-ble future.Alongside the basic economic trends in the mar-kets that it serves directly or through partners,gen-eral tr
226、ends relevant to the retail sector i.e.primar-ily the online trade,but also long-term issues like demographic developments,new ways of achiev-ing customer loyalty or internationalization are becoming more important all the time.They are already leading to new major focuses of interest for the retail
227、 trade;GK SOFTWARE is directly affected by them and has already responded in terms of the range of its products.Regardless of the increasing importance of inter-national business,the developments in the Ger-man-speaking world continue to be particularly important for GK SOFTWAREs direct business.201
228、2 was a very successful year for the retail trade in Germany,the largest market in this region.Sales rose in nominal terms by 1.5 percent in com-parison to the previous year and 2011 had set a new record with increases of 2.6 percent.1 As a result,sales in the sector(excluding vehicles,gas stations,
229、fuels and drugstores)totaled approx.EUR 428 billion.Sales in the retail sector therefore rose 1 http:/www.einzelhandel.de/index.php/presse/aktuelle-meldungen/item/122264-einzelhandel-bleibt-stabilit%C3%A4tsanker-und-jobmotor-hde-fordert-entlastung-der-verbraucher-bei-den-energiekosten.htmlmore stron
230、gly than the countrys gross domestic product(GDP),which was only able to increase by 0.7 percent in nominal terms.2 The fact that the retail sector contributed 16.2 percent to GDP in 2012 also demonstrates the significance of the sec-tor for the overall economy in Germany.2012 was once again a year
231、that recorded a huge increase in e-commerce sales and the figure rose by 27.2 percent to approx.EUR 28 billion.Overall,interactive trade primarily e-commerce and the mail order business achieved sales of approx.EUR 39 billion and therefore exceeded the nine percent threshold in terms of the total re
232、tail sec-tor sales for the very first time.3 One factor is very important for stationary retailers:Women,who now account for 55 percent of online sales,particularly like making purchases at traders with a multi-chan-nel strategy.That is to say,they prefer the retailers that they know from the statio
233、nary business when making their purchases online.Despite this,the purely online retailers achieved the strongest growth rates in sales last year with approx.40 percent.The 2 https:/www.destatis.de/DE/PresseService/Presse/Presse-konferenzen/2013/BIP2012/Pressebroschuere_BIP2012.pdf?_blob=publicationF
234、ile,p.7.3 Source:http:/www.bvh.info/bvh/aktuelles/details/arti-kel/interaktiver-handel(2012-)erneuter-umsatzrekord-e-com-merce-anteil-ueberspringt-die(27-)milliarden-eu/?cHash=23119242fbbe9c1765d69f1ceeb9085aGrowth of German retail between 2002 and 2012 in Billion EUR (Source:Charts from the HDE ann
235、ual press conference for 2013)427.9+1.5%2012410.9+2.0%2010402.8(3.1%)2009415.7+1.1%2008411.2(1.2%)2007416.2+0.6%2006413.7+0.9%2005410.0+2.2%2004401.2(1.4%)2003406.9(2.1%)2002421.5+2.6%2011CONSOLIDATED ANNUAL REPORT Business Report 45share of purchases,which were solely made using mobile devices,almo
236、st doubled(EUR 2 billion).4 These developments,which are continuing unchecked,provide huge challenges for the sta-tionary retail sector,and they are also being pow-ered by other issues like home delivery about 50 percent of all food retailers see new prospects here.5 New and replacement investments
237、are often subject to the need for retailers to be equipped to face issues in the future.As the number of exam-ples of genuine omni-channel integration is still low and there are often uncertainties about the strat-egy that should be pursued,this is currently lead-ing to extended periods of time befo
238、re purchase decisions are made.GK SOFTWARE also felt the effects of delays in the sales cycles last year.4 http:/www.bvh.info/index.php?eID=tx_nawsecuredl&u=0&file=uploads/media/130212_Pra%CC%88si-Auszug_fu%CC%88r_die_Pressemappe.pdf&t=1363174984&hash=3faa84f3116e662c5a9fef56171e04a1,p.5.5 Ernst&You
239、ng Retail Trade Barometer,October 2012,p.19,http:/ German Retail Federation(HDE)is expect-ing nominal growth of one percent to approx.EUR 432 billion in 2013 despite these trends.6 But the experience of the last few years shows that the forecasts made by the HDE were always very con-servative and we
240、re significantly exceeded by the actual sales recorded by the retail sector.The HDE believes that the general mood for consumption is intact and this forms the basis for continued moder-ate growth,the savings quota is constant,the jobs market will remain stable and personal incomes will continue to
241、develop positively.However,the continuing increase in energy prices is viewed as a negative factor for consumer habits.7 Much higher growth rates are expected for the e-commerce sec-tor;the Federal Association of German Mail Order Companies(bvh)is forecasting growth of more than 21 percent here in 2
242、013.86 Charts from the HDE annual press conference for 2013,p.4.7 Idem,p.10.8 http:/www.bvh.info/index.php?eID=tx_nawsecuredl&u=0&file=uploads/media/130212_Pra%CC%88si-Auszug_fu%CC%88r_die_Pressemappe.pdf&t=1363174984&hash=3faa84f3116e662c5a9fef56171e04a1,p.19.One Standard Software Solution for all
243、Countries Countries allready implementedCountries in planningCONSOLIDATED ANNUAL REPORT Business Report46Surveys of retailers related to their business pros-pects support the forecast published by the HDE that 2013 will overall be a positive year.The survey of retailers entitled“HandelSkix”in Februa
244、ry 2013 showed that three quarters of the retailers ques-tioned were expecting their business to remain con-stant or improve during the next twelve months.1 Ernst&Young delivered an even more positive pic-ture in its survey where only 11 percent of retailers said that they were expecting their busin
245、ess pros-pects to deteriorate during the next six months.2 The studies published by the market research company GfK also support the HDE forecasts in terms of developments in the retail sector.The gen-eral mood among consumers is positive and the economic expectations including those of indus-try,as
246、 the ifo business climate index shows are improving.Overall,the GfK is expecting growth of 1.1 percent in the non-food and food retail sector.3Based on the good sales during the past two years and the stable prospects for 2013,the retail sectors readiness to invest is on the rise.The Ernst&Young Ret
247、ail Trade Barometer in October 2012 shows that 43 percent of the retailers questioned assume that total investments in 2013 will increase(20 percent in the previous year).4 What is important for business developments at GK SOFTWARE here is to establish to what degree this trend also affects IT inves
248、tments,as the experience of the last few years shows that an increase in the readiness to invest by the retail trade does not necessarily also cover this area.The survey by Ernst&Young shows one of the reasons why.Almost half of the retailers questioned are planning to expand their sales space and m
249、ore than one third wish to increase the number of their sales channels.5 The strategy of many retailers involves extending their network of stores during the growth phase and expanding abroad.This may lead to fresh opportuni-1 HANDELSkix,HDE-Handelskonjunkturindex,S.8,http:/www.handelskix.de/app/dow
250、nload/7060636175/HAN-DELSkix_Ergebnisse+Februar+2013.pdf?t=1362468257.2 Ernst&Young-Handelsbarometer,Oktober 2012,p.9.3 http:/ Ernst&Young-Handelsbarometer,Oktober 2012,p.5.5 Idem,p.17.ties for GK SOFTWARE;on the other hand,invest-ment funds are then tied up for these fields.Overall,the investment n
251、eeds in the retail sector,as revealed by the current study by the EHI Retail Institute entitled“Till Systems 2012 Facts,Background Infor-mation and Prospects,”continue to be high.6 The age of the software in use has continued to increase,as almost 25 percent of the solutions are now more than 10 yea
252、rs old.7 A current study by the EHI shows that the replacement investments are increasingly being interfered with by the new subjects already addressed above.8 Multi-channel integration and the use of mobile devices by consumers and employees are described as the greatest challenges at the moment an
253、d,in their strategic importance,they are only exceeded by the introduction of new merchandise management solutions.9 More than half the retailers questioned by the EHI assume that their IT budgets will increase,while only 14 percent assume that they will decline.The total budgets account for figures
254、 between 0.96 and 1.3 percent of net sales.10 If we focus on the stores,the replacement of till systems is rated as the most important strategic issue for 34 per-cent of the companies questioned.IT departments at retailers are focusing on issues in the field of new tech-nologies with self-checkouts,
255、mobile devices for inter-nal processes and the interaction between consumer smartphones heading the list;GK SOFTWARE has an excellent market position to deal with these.11 Overall,the prospects for the business perfor-mance at GK SOFTWARE remain positive in 2013 too.And this is all the more true bec
256、ause the com-pany assumes through its partnership with SAP that it can continue to expand its base of potential cus-tomers in the international arena.The prudent kick-starting of the economy in many countries in the euro zone12 and the improved prospects for retail-6 EHI Retail Institute,Kassensyste
257、me 2012,Kln 2012.7 Idem,p.30f8 EHI Retail Institute,IT-Trends im Handel 2013.Investitionen,Projekte und Technologien,Kln,2013.9 Idem,p.20f.10 Idem,p.33.11 Idem,p.43f.12 http:/ ANNUAL REPORT Business Report 47ers in the USA may open up more opportunities.These trends are subject to the proviso that t
258、he global economy is not severely disrupted by politi-cal or economic factors,which could have a nega-tive effect on the economic cycle.GK SOFTWARE continues to assume that the investments in new systems that are required in the short or medium term and the use of new technol-ogy fields for the reta
259、il sector will continue to pro-vide sales potential in Germany and the other mar-kets that are being actively processed in the future too.The company also expects the partnership with SAP in particular to lead to success stories internationally and reinforce the companys poten-tial in the long term.
260、GK SOFTWARE currently has a good position in several requests for proposals in Germany and abroad in the direct sales sphere and in its partner business and has important advantages over its competitors with its broad portfolio of products,the internationality of its solutions and its proven ability
261、 to complete projects quickly.Explanation of the Business Results and an Analysis of the Assets,Financial and Earnings SituationBusiness developments with existing customers were not as strong as the previous year for GK SOFTWARE in fiscal 2012 and there was an almost complete absence of business wi
262、th new cus-tomers,even if some interesting new customer rela-tionships emerged in addition to the previous ones.Unfortunately,the development in business with existing customers was not able to compensate for this absence,with the result that sales declined by 10.5 percent or EUR 3.33 million to a f
263、igure of EUR 28.43 million after eight years of rapid growth.In order to be prepared for the expected larger number of sales success stories in 2013,the capacities,which had been increased during the course of 2011 in anticipation of further growth,were deliberately not reduced in 2012.As a result,t
264、he earnings before interest and taxes(EBIT)fell to EUR 0.78 million.This corresponds to an EBIT mar-gin of 2.8 percent related to sales.Development of sales distribution between 2011 and 2012 in K EUR1,300244Other Business14,46914,468Services3,8388,295Licenses8,8198,746Maintenance28,42631,753CONSOLI
265、DATED ANNUAL REPORT Business Report48All the business units were affected by this decline in sales so that the sales in the GK/Retail sector fell by 12 percent to EUR 25.96 million.But we are delighted to be able to prove with a cus-tomer like Al Muhaidib in Saudi-Arabia how our software solutions c
266、an handle an international arena.The Hammer Heimtex project,which was gained in the companys home market,also proved once again the ongoing attractiveness of the GK solutions.The decline in the SQRS business was planned,but was still significant.Sales of EUR 0.41 million less were recorded during th
267、e year in question,with the result that sales for fiscal 2012 amounted to EUR 1.92 million.As a result of the acquisition of the AWEK Group,another business unit has joined the others.The contribution to sales from this IT services business amounted to EUR 0.55 million for the period 10 31 December
268、2012.Earnings Situation Sales at EUR 28.4 million;Group profits of EUR 0.78 million EBIT margin on sales of 2.8 percent The Groups total sales declined by EUR 3.33 mil-lion to EUR 28.43 million,following a figure of EUR 31.75 million in the previous year.Our GK/Retail core software solutions generat
269、ed 91.3 percent of this figure;the figure of EUR 25.96 mil-lion was EUR 3.47 million below the previous years.The volume of the SQRS business amounted to EUR 1.92 million and therefore accounted for 6.8 percent of total sales.The IT ser-vices business has been added to the portfolio through the take
270、over of the AWEK Group.This business contributed EUR 0.55 million or 1.9 per-K EUR20122011ChangeSales withGK/Retail 25,959 91.3%29,426 92.7%(3,467)(11.8%)SQRS 1,918 6.8%2,327 7.3%(409)(17.6%)IT-Services 549 1.9%0.0%549 Total 28,426 100.0%31,753 100.0%(3,327)(10.5%)Licences 3,838 13.5%8,295 26.1%(4,4
271、57)(53.7%)GK/Retail 3,838 13.5%8,295 26.1%(4,457)(53.7%)SQRS 0.0%0.0%IT-Services 0.0%0.0%Maintenance 8,819 31.0%8,746 27.5%73 0.8%GK/Retail 7,332 25.8%7,201 22.7%131 1.8%SQRS 1,487 5.2%1,545 4.8%(58)(3.8%)IT-Services 0.0%0.0%Services 14,469 50.9%14,468 45.6%1 0.0%GK/Retail 14,043 49.4%13,707 43.2%33
272、6 2.5%SQRS 426 1.5%761 2.4%(335)(44.0%)IT-Services 0.0%0.0%Other Business 1,300 4.6%244 0.8%1,056 432.8%GK/Retail 746 2.7%223 0.7%523 234.5%SQRS 5 0.0%21 0.1%(16)(76.2%)IT-Services 549 1.9%0.0%549 CONSOLIDATED ANNUAL REPORT Business Report 49cent of total sales from 11 December 2012 onwards.A glance
273、 at the make-up of sales according to types of activities allows us to identify the stability in GK SOFTWAREs customer relations.The figure of EUR 14.47 million in 2012 maintained the sales of services at the same level as in the previous year.This was achieved by a slight increase in the GK/Retail
274、business of EUR 0.34 million.The decline in sales in the SQRS business(a fall of EUR 0.34 million in sales)had been expected.The second most important type of sales involves main-tenance revenues.They accounted for EUR 8.82 million or 31.0 percent of the total sales in the year under review,after a
275、figure of EUR 8.75 million had been generated in the previous year.The reve-nues from licensing fell significantly.Revenues from licenses amounted to EUR 3.84 million following a figure of EUR 8.30 million in the previous year a fall of EUR 4.46 million.This decline can be attrib-uted to the inadequ
276、ate level of new business.Under other items,where we have initially entered the sales from the newly acquired business linked to the AWEK Group,sales were EUR 1.06 million higher than in the previous year,where the IT ser-vices business accounted for EUR 0.55 million of this figure.The remaining sal
277、es revenues were mainly generated from revenues for purchasing hardware for customers.Investments in the solutions provided by GK SOFTWARE continued in fiscal 2012.Overall,development work amounting to EUR 0.75 million was capitalized,after a figure of EUR 1.49 million was invested in products in th
278、e previous year.This decline reflects the increasing degree of maturity of the product.Other operating revenues rose by EUR 0.93 million to EUR 1.66 million during the year under review.The main reason for this was the reversal of uncertain liabilities amounting to EUR 0.95 million.Therefore the Gro
279、ups total oper-ating revenues amounted to EUR 30.70 million in the year under review,following a figure of EUR 33.97 million in the previous year(9.6 percent).Expenditure on purchased goods and services increased by EUR 0.04 million,particularly through the work of the AWEK Group.Overall,EUR 0.13 mi
280、llion of the total figure of EUR 0.67 K EUR20122011ChangeSales 28,426 92.6%31,753 93.5%(10.5%)Changes inventoriesfinished goods(127)(0.4%)0.0%-Own work capitalized 747 2.4%1,489 4.4%(49.8%)Operating revenues 29,046 94.6%33,242 97.9%(12.6%)Other operating revenues 1,658 5.4%729 2.1%127.5%Total operat
281、ing revenues 30,704 100.0%33,971 100.0%(9.6%)Development of the EBIT between 2009 and 2012 in K EUR784 20126,43520106,65420114,890 2009CONSOLIDATED ANNUAL REPORT Business Report50million for this item can be traced back to this busi-ness.In order to be equipped for the expected capac-ity requirement
282、s,GK SOFTWARE has deliberately not reduced its capacities,but maintained them in fiscal 2012.Expenditure on human resources therefore remained constant.Overall 6.3 percent more was spent on salaries and social security insur-ance than in the previous year.This is due to main-taining capacities at an
283、 even level throughout the year and finds expression in the average number of employees of 458,following an average figure of 398 in the previous year.Amortization/depreciation amounted to EUR 2.07 million,following a figure of EUR 1.95 million in the previous year.The increase by EUR 0.12 mil-lion
284、is largely due to the increased scheduled need for amortization on own work capitalized by the investments made in 2012 and the intangible assets acquired as a result of the acquisition of the AWEK Group.Other operating expenditure rose by EUR 1.24 million.The reasons for these were primarily increa
285、sed expenditure on special project costs of EUR 1.10 million,which were mainly caused by expected expenditure on warranties.As a result,GK SOFTWARE was able to gener-ate earnings before interest and taxes(EBIT)of EUR 0.78 million.This figure is EUR 5.87 million below the previous years result.This a
286、mounts to earnings per share of EUR 0.38.1 Related to salesK EUR20122011ChangeEBIT 785 2.8%1 6,654 21.0%1(88.2%)EBT 819 2.9%1 6,569 20.7%1(87.5%)Group result 675 2.4%1 4,564 14.4%1(85.2%)The financial results amounted to 0.03 million euros during the reporting year and were therefore 0.12 million eu
287、ros higher than the previous years figure of 0.085 million euros.Expenditure on interest,which was mainly due to funding for the buildings at GK SOFTWARE headquarters and the purchase of Solquest GmbH,were 0.08 million euros lower than the previous years figure,while income from interest mainly due
288、to the larger amounts of cash and cash equivalents above the annual average figure were 0.04 million euros higher than the previous years figure.This created results before income tax of 0.82 million euros and therefore results that were 5.68 million euros lower than in the previous year.After taxes
289、,the Group annual net income amounted to 0.67 million euros,following a figure of 4.56 million euros in the previous year.Assets SituationThe Group balance sheet total amounted to EUR 44.06 million on the reporting date in the year under review and was therefore EUR 0.58 million above the comparable
290、 figure in the previous year(EUR 43.48 million).On the assets side,this increase was mainly due to the acquisition of the AWEK Group and its initial consolidation on 10 December 2012.As a result,the non-current assets increased by EUR 2.15 million and the current assets(without cash and cash equival
291、ents)by EUR 2.03 million,while the cash and cash equivalents declined by almost the same amount(EUR 3.60 mil-lion).On the financing side,the major factor for the decline in equity was the dividend payment from the annual net earnings as at 31 December 2011,which exceeded the annual results of EUR 0.
292、67 mil-lion.This effect was reduced by increasing the capi-tal reserves by granting stock options.The non-cur-rent liabilities fell by EUR 1.61 million,although the pension provisions rose by EUR 1.52 million and the deferred tax assets and liabilities increased by EUR 0.08 million because of the ac
293、quisition of the AWEK Group.In contrast,the non-current bank lia-bilities were reduced by EUR 3.18 million as a result of scheduled repayments and the repayment of an existing loan.Current liabilities rose by 2.24 milion EUR.The reasons for this are mainly the new short-term loan taken out at DZ Ban
294、k AG amounting to EUR 2.0 million and the accrual of liabilities as a result of the acquisition of AWEK.CONSOLIDATED ANNUAL REPORT Business Report 51K EUR20122011ChangeNon-current assets 16,274 36.9%14,125 32.5%15.2%Current assets or cash and cash equivalents 17,519 39.8%15,491 35.6%13.1%Cash and ca
295、sh equivalents 10,265 23.3%13,859 31.9%(25.9%)Assets 44,058 100.0%43,475 100.0%1.3%Equity 28,187 64.0%28,231 64.9%(0.2%)Non-current liabilities 5,007 11.4%6,623 15.2%(24.4%)Current liabilities 10,864 24.6%8,621 19.9%26.0%Liabilities 44,058 100.0%43,475 100.0%1.3%This increase is due to the developme
296、nt of current provisions,which primarily rose by EUR 0.91 million because of the development of warranty provisions.At the same time,the trade accounts payable rose by EUR 0.51 million and the current bank liabilities by EUR 1.41 million.This impact is mainly due to the initial consolidation of the
297、AWEK Group too.The decline in other liabilities by EUR 1.25 million had a positive effect on the figures.The decline in current assets was primarily caused by the decline in trade accounts receivable by EUR 0.44 million and the fall in cash and cash equivalents by EUR 3.6 million.These are partly co
298、mpensated for by the increase in claims for the reimbursement of income tax by EUR 1.06 million and other accounts receivable and assets by EUR 0.27 million.The reason for the increase in claims for the reimbursement of income tax is mainly the outstanding accounts in corporation tax plus the soli-d
299、arity surcharge and advance payments of business tax.Accounts receivable totaling EUR 3.0 million with extended payment periods have been included under“Trade accounts receivable.”Holdings of cash and cash equivalents amount-ing to EUR 10.26 million exceed the interest-bearing liabilities amounting
300、to EUR 3.48 million by EUR 6.78 million.The development of the provision of cash and cash equivalents is shown within the anal-ysis of the financial situation.The development of non-current assets was domi-nated by the acquisition of the AWEK Group.As a result of the preliminary identification of th
301、e acquired assets,customers relations worth EUR 0.80 million,technologies(software)amounting to EUR 0.82 million and goodwill amounting to EUR 0.24 million were identified in the area of intangible assets.The further increase is due to the capitaliza-tion of services related to the GK/Retail product
302、s amounting to EUR 0.75 million.Scheduled amorti-zation of EUR 1.43 million was entered under the total intangible assets.Property,plant and equip-ment increased by EUR 0.45 million mainly because of the investment in a developed property in Sch-neck.The increase in assets in terms of operating and
303、business equipment is mainly due to the initial consolidation of the AWEK Group.Financial SituationThe cash flow from operating business in the nar-rower sense i.e.without any change to the net cur-rent assets declined from a figure of EUR 8.76 mil-lion in the previous year to EUR 2.94 million,i.e.b
304、y EUR 5.82 million.The main forces behind this devel-opment were the decline in the annual results(EUR 3.89 million)and the lower income tax(EUR 1.86 million)that was entered on the expenditure side.The changes in net current assets on the reporting date weighed on the operating cash flow in the nar
305、-rower sense at EUR 1.91 million;this figure amounted to EUR 2.57 in the previous year.The main financial relief came as a result of the develop-ments in accounts receivable,which declined by CONSOLIDATED ANNUAL REPORT Report on Key Events after the Balance Sheet Date52EUR 2.41 million.Another facto
306、r was the increase in provisions,which rose by EUR 1.61 million.Less important factors were the decline in inventories by EUR 0.12 million and the increase in advance pay-ments received by EUR 0.20 million.The decline in liabilities by EUR 2.42 million weighed on the cash flow.As a result,there was
307、an increase in cash and cash equivalents from operating business of EUR 4.85 million,following a figure of EUR 6.19 million in the previous year.The balance of interest payments and the income tax needing to be paid weighed on the operating cash flow during the year under review at EUR 1.79 million,
308、following a figure of EUR 1.44 in the previ-ous year.Overall,there was a net accrual of funds from operating business of EUR 3.06 million,which meant that the previous years figure of EUR 4.75 million was missed.The Groups investment behavior was dominated by the acquisition of the AWEK Group during
309、 the year under review.The net outflow of funds for investment purposes amounted to EUR 3.99 million during the reporting year,after the figure had been EUR 2.69 million in the previous year.The financing activities during the business year were dominated by the payment of a dividend amounting to EU
310、R 0.90 million and the repayments of bank loans amounting to approx.EUR 3.81 mil-lion and raising funds from new sources to the tune of EUR 2.04 million.Bank loans amounting to approx.EUR 1.77 million were repaid on the bal-ance sheet.Overall,there was an outflow of funds amounting to EUR 2.67 milli
311、on from the Group in terms of financing activities.There was a total outflow of funds amounting to EUR 3.60 million during the business year with the result that the holdings of cash and cash equivalents fell to a figure of EUR 10.27 million on the reporting date.Report on Key Events after the Balan
312、ce Sheet DateNo major events took place after the end of fiscal 2012 that need to be mentioned at this point.CONSOLIDATED ANNUAL REPORT Report on Risks and Prospects at GK SOFTWARE 53Report on Risks and Prospects at GK SOFTWARERisks During its recent examination of the risks and opportunities facing
313、 the company,the Manage-ment Board did not discover any notable change to the statements made in previous years.But the analysis did identify two fairly new risk complexes and reference will be made to them in the form of comments below.GK SOFTWARE deliberately takes entrepre-neurial risks in order
314、to be able to benefit from the opportunities presented by the market in an appro-priate manner.A risk management system was introduced during the past few years to recognize,manage and minimize the risks at an early stage.Among other things,the Management Board meets once a month to identify possibl
315、e risks and introduce countermeasures.The Supervisory Board is informed of the results of these discussions.The risk management system is being continually updated.One major risk which cannot be influenced by the Group involves business developments at customers of GK SOFTWARE on account of the deve
316、lopment of the general economy and consumer sentiment.The actual developments in fiscal 2012 and the prospects for fiscal 2013 have been dominated by a generally calm,but constant growth process in the global economy.However,the high level of uncertainty in the financial markets with regard to the s
317、overeign debt crisis within the eurozone is not only dominating the headlines in the economic press.The effects of the crisis in the Gulf region are also completely unclear.The actual ongoing developments in these situations and the uncertainties associated with them will have an effect on economic
318、developments in Europe to a degree that cannot yet be determined.The forecasts of associations and analysts indicate that the retail sector will once again develop in a relatively calm way in the significantly calmer overall economic climate;but the psychological effect of any contradictory news in
319、an environment,which is difficult to predict,and its effects on the investment behavior of customers of GK SOFTWARE is hard to forecast as was true last year.In the light of this general uncertainty,the Management Board continues to make every effort to provide itself with room to maneuver by keepin
320、g costs as flexible as possible and only deliberately incurring them if they are necessary.One major argument for the successful sale of GK SOFTWARE solutions and what are in many cases long-standing customer relations is the consistently successful completion of customer projects in the past.Howeve
321、r,any disasters in the project business could do long-term damage to this positive reputation and even lead to a reversal of this positive sentiment towards GK SOFTWARE.This kind of situation could pose a threat to the companys ongoing existence.As a result,the relevant project managers inform the r
322、esponsible members of the Management Board about possible risks during the course of ongoing projects in order to enable an appropriate and timely response to these kinds of risks.GK SOFTWARE views the degree of customer satisfaction and the number of new customer contacts as an important indicator
323、for assessing risks.These two factors are therefore subject to particular monitoring and are regularly checked as part of the sales controlling processes.On the basis of its customer structure and the structure of its target market,the consolidated group business is repeatedly dominated by indi-vidu
324、al major projects with a relatively low number of customers,so that these business relations provide significant contributions to sales and results within a fiscal year.The Management Board assumes that this will continue to be the case in the future too.If a business partner breaks off a project or
325、 falls into payment difficulties,this could have financial consequences for GK SOFTWARE.However,this risk is restricted by regular payment plans or agreemants for payments according to what are known as project milestones.Another new risk results from the start of devel-opments related to omni-chann
326、el approaches to CONSOLIDATED ANNUAL REPORT Report on Risks and Prospects at GK SOFTWARE54retailing.This fundamentally new way of thinking and the opportunity of introducing it can extend the sales cycles in comparison to current times,as customers view these developments as strategic and have to in
327、troduce a relevant process to achieve the full potential.This can lead to extended times for decisions with the correspond-ing effects on the sales opportunities for GK SOFT-WARE.The ongoing consolidation of the retail sector market may lead to a reduction in the number of store networks in the shor
328、t term,so that demand from the retail sector could rise.The retail sector in Germany is generally dominated by price wars.Retail companies therefore seek to pass on the resulting pressure on prices to their suppliers and contractual partners.This process is also felt for investments in IT equipment
329、and may have an effect on producers of retail sector software.As GK SOFTWARE AG,however,provides solutions for a highly central function within retail sector groups,these risks are not classified as a threat to the companys existence.The consolidation taking place among our cus-tomers was clearly vi
330、sible for the first time in the past business year on the part of competitors too.This concentration is clear from the acquisition of direct competitors of GK SOFTWARE AG by glob-ally important manufacturers of hardware,which then become universal providers for the retail sec-tor.This combination co
331、uld cause possible custom-ers to purchase all their services from these rival firms.Although the management board at GK SOFTWARE AG assumes that the market developments used in the past to purchase hard-ware and software separately will continue,a reversal of this trend and therefore a negative impa
332、ct on GK SOFTWAREs sales opportunities cannot be completely ruled out.The planned expansion is also associated with certain financial risks.These mainly arise from preliminary payments made to acquire customers by consolidated companies.This risk is increased by the extensions for sales cycles outli
333、ned above in the report on the business situation.The increase in sales expenditure associated with longer sales cycles plays a role in part.But the need to maintain the ability to deliver products when deals are signed is of special importance.This can lead to idle capacity costs of a significant magnitude.In the course of any further expansion,the project business will have furthermore to be inc
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