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TRANSCRIPT
Vision breeds success.
Kässbohrer Geländefahrzeug AG is the world's
leading supplier of all-terrain vehicles for ski
slope, beach and environmental maintenance. The
PistenBully brand name represents a forward-
looking technology that enables ski slope opera-
tors to quickly adapt to changing trends in winter
sports. What is needed are innovative snow man-
agement ideas that are always slightly ahead of
their time – like our PistenBully.
PistenBully also stands for all-terrain vehicles
that can withstand even the most extreme condi-
tions, such as those found in the Antarctic, and for
the extraordinary climbing power, reliability, and
robustness of these vehicles. These qualities have
enabled us to develop many new applications
recently for the PistenBully apart from winter
sports. Special PistenBully models with newly
developed caterpillar tracks are ideally suited for
transport purposes in difficult-to-reach terrain
and can be used as an alternative anywhere con-
ventional wheel-driven vehicles are stopped in
their tracks.
Our BeachTech technology is still number one in
beach cleaning and maintenance. The beach-
cleaning technology patented by Kässbohrer
Geländefahrzeug AG ensures that many vacation
destinations around the world have clean, well-
groomed beaches that are a vacationer's dream.
BeachTech is also the first choice for cleaning up
environmental damage caused by disasters – so
that the great outdoors is clean for our children to
enjoy.
Further developing our product range and appli-
cations in a consistent and future-oriented manner
has allowed us to systematically advance our
company. That is why fiscal year 2001/2002 was
one of the most successful years since the
founding of our company.
Annual Report2001/2002
1) Because the fiscal year was changed (current balance sheet date: September 30), the balance sheet items for fiscal year 2001/2002 are only comparable with those of
the short fiscal year 2001. Inventories are correspondingly high at the reporting date of September 30, which is shortly before vehicles are shipped out for the winter season.
2) Short fiscal year from April 1 – September 30, 2001: Due to seasonal influences, only about 25% of annual sales are generated in the months from April to September.
For this reason, the short fiscal year shows a loss after only six months. The earnings situation in the short fiscal year is therefore not comparable to the other fiscal years.
3) Earnings before income tax, financial result and extraordinary result.
4) Because the balance sheet date was changed, the equity ratios for fiscal year 2001/2002 and the short fiscal year 2001 are not comparable with earlier years. See footnote 1.
5) Proposal to be made at the General Meeting.
The Kässbohrer Geländefahrzeug Group in figures. The Company.Managing Board
Dr. Ing. Hendrik Grobler, Chairman
Rolf Glessing
Supervisory Board
Ludwig Merckle, Chairman
Dr. Otmar Weigele, Deputy Chairman
Dr. Susanne Frieß
October 1 to April 1 to April 1 to April 1 to April 1 to
September 30, September 30, March 31, March 31, March 31,
2001/20021)
2001(short fiscal year)2)
2000/2001 1999/2000 1998/1999
(All figures in millions € )
Kässbohrer Geländefahrzeug AG
Kässbohrerstr.11
88471 Laupheim
Tel.: +49 (0) 7392 /900-0, Fax: +49 (0) 7392 / 900-510
www.pistenbully.com
Austrian branch office
Gewerbestraße 173, 5431 Kuchl,
Austria
Tel.: +43 (0) 62 44/4 00 10
Fax: +43 (0) 62 44/40 01 11
www.pistenbully.at
French subsidiary
Socedam S.A.
B.P. 37, 74.190 Le Fayet
Haute Savoie, France
Tel.: +33 (0) 4 50/78 23 33,
Fax: +33 (0) 4 50/78 42 99
www.pistenbully.fr
US subsidiary
Kässbohrer All Terrain Vehicles Inc.
750 A South Rock Boulevard,
Reno, Nevada 89502 USA
Tel.: +1 (0) 7 75/8 57-50 00,
Fax: +1 (0) 7 75/8 57-50 10
www.katvpb.com
Swiss branch office
Bruneggerstrasse 45, 5103 Möriken,
Switzerland
Tel.: +41 (0) 62/8 87 70 50
Fax: +41 (0) 62/8 87 70 51
www.pistenbully.ch
Italian branch office
Via Galileo Galilei, 32, 39100 Bolzano,
Italy
Tel.: +39 (0) 4 71/93 30 27
Fax: +39 (0) 4 71/93 29 75
www.pistenbully.it
Consolidated Income Statement Only the columns with the same color are comparable!
Sales 132.2 30.4 136.2 119.8 112.8
Total revenue 127.3 49.8 138.4 118.6 113.6
Cost of materials -68.2 -33.7 -79.8 -69.8 -66.2
Personnel expenses -25.6 -11.7 -23.8 -20.8 -20.1
Depreciation and amortization expense -2.6 -1.2 -2.5 -2.4 -4.2
Other operating expenses/income -20.5 -10.1 -17.6 -16.0 -15.6
EBIT 3) 10.4 -6.9 14.7 9.6 7.5
Financial result -1.7 -0.4 -1.2 -1.0 -2.0
Extraordinary result – – – – -2.3
Earnings before income tax 8.7 -7.3 13.5 8.6 3.2
Income tax -2.3 3.2 -5.2 -2.4 -1.6
Consolidated net income/loss after taxes 6.4 -4.1 8.3 6.2 1.6
Consolidated Balance Sheet
Assets
Fixed assets 11.7 10.5 10.8 11.9 12.5
Current assets /prepaid expenses 77.7 80.7 63.3 51.6 60.2
Equity and liabilities
Equity 30.3 25.3 31.6 26.3 21.0
Provisions 17.4 17.1 19.6 15.1 12.0
Liabilities /deferred income 41.7 48.8 22.9 22.1 39.7
Total assets 89.4 91.2 74.1 63.5 72.7
Additional key figures
Average number of employees for the year 426 412 384 366 361
Sales per employee (in € thousands) 310 74 355 327 312
Return on sales (based on EBIT) in % 7.9 – 10.8 8.0 6.6
DVFA/SG earnings per share in € 1.32 -0.60 1.65 1.10 0.56
DVFA/SG cash flow 9.9 -4.1 11.1 8.7 7.0
Equity ratio 4)(in %) 33.9 27.7 42.7 41.3 28.9
Interest-bearing debt capital 26.6 32.2 10.6 11.8 27.8
Net investments 3.9 0.9 1.3 1.6 1.9
Cash dividend per share in € 0.30 5) 0.26 0.41 0.61 0.18
Cash dividend yield in % 2.5 3.2 2.6 5.4 1.6
2–3 Letter to Shareholders.
4–5 Report of the Supervisory Board.
PistenBully.8–9 Fun, Snow and Sports: An Adventure on the Slopes.
10–11 Setting Trends With Our Future-Oriented Vehicles.
12–13 Consider the Factors Before Storming the Summit.
14–15 Excellent Performance: All in the Family.
16–17 A Daily Joy in Icy Regions? PistenBully on the Rocks.
PistenBully in the Springtime.20–21 We gladly face mud, water, and swamps to develop new applications.
22–23 The Universal-Use Vehicle. (OK, We Admit It: It Won't Ever Fly.)
24–25 Legally Speaking They Are Called Used Vehicles. We Prefer to Call Them Experienced.
BeachTech.28–29 How Do You Get Where You Want to Go in the Summer? By Your Own Power on New Terrain.
30–31 What Do You Expect From Us? A Beautiful Beach. Clean Sand. And a Good Vacation.
The Company.34–35 Even Global Leaders Sometimes Need a Change of Perspective.
36–37 Tested, Improved. Tested Again – And Improved Even More.
38–39 We Like to Be Close to You: Which Is Why We Are Always On-Site Everywhere.
Facts and Figures.42–43 Kässbohrer's Shares.
44–49 Combined Management Report and Group Management Report.
50–51 Balance Sheet and Consolidated Balance Sheet.
52–53 Income Statement and Consolidated Income Statement.
55–67 Combined Notes to the Single-Entity and Consolidated Financial Statements.
68 Audit opinion.
Table of Contents.
We also consolidated our facilities and moved
them to Laupheim, Germany, in parallel with this
very successful product initiative. From the very
beginning, it was particularly important to us not
to neglect our market activities. We were able to
build our new factory within the planned time and
budget. After a construction period of only 11
months, production successfully commenced in
Laupheim in early March 2002. The new factory
has enabled the company to manufacture even
better quality vehicles more cost-effectively
thanks to state-of-the-art test beds and signif-
icantly improved production workflows. We
consciously emphasized an open architecture and
floorplan when designing the facility – this will
make our close contact to customers even closer.
The new factory is a clear sign of the continuity
and positive development of our company.
This Annual Report represents the second time
that we have prepared our annual financial
statements as of a reporting date of September 30.
For our company, this is the time of year when
inventories are more or less at their highest
because we manufacture our vehicles in advance
so that we can ship them in time for the winter
season. Despite this fact, Kässbohrer's equity ratio
rose to 34 % even at this unfavorable time of year.
Thanks to our excellent business performance, we
will be able to recommend payment of a dividend
of EUR 0.30 per share to the General Meeting
while at the same time strengthening the financial
foundation of our company.
The excellent market position of our company is
the basis for a successful future, even in the
current difficult market environment. This was
possible only due to the unstinting commitment of
all of our employees, whom I would like to thank
sincerely for their efforts.
Laupheim, December 2002
Dr. Hendrik Grobler, Managing Board Chairman
Fiscal year 2001/ 2002 was in many ways an
extraordinarily challenging and interesting year.
On the one hand, customers were extremely hesi-
tant to invest due to the global economic slow-
down. On the other, we felt the decline in sales in
the tourism market – also caused by economic
factors. The global market for slope-maintenance
vehicles contracted by over 10 % compared with
the previous year.
In this difficult market environment, we were able
to stabilize our market share at over 50 % – and
even increase it in the key market for well-
equipped, large-scale slope-maintenance vehicles.
The close of the 2001/ 2002 fiscal year brought us
our second best results in the history of the
company. Sales amounted to EUR 132.2 million
and net income totaled EUR 6.4 million after tax.
An unparalleled product initiative has enabled us
to expand our range of products to include new,
forward-looking vehicles, and to improve our
position vis-à-vis the competition.
In spring 2002, we launched a new large-scale
machine, the PistenBully 300 Polar. Its powerful
430-horsepower motor and the innovative, intelli-
gent SNOWtronic tiller control make carefully
controlled and economical slope management
possible. This vehicle defines the new premium
product segment with its other equipment as well,
which ensured that the PistenBully 300 Polar met
with an even higher level of acceptance than
anticipated. The new generation of PistenBully
winches was also launched in spring 2002. This
new winch features over 30 % more tractive
power and a 30 % higher driving speed than
before. The result is an enormous increase in
performance in terms of snow displacement and
steep-slope maintenance. This advantage is
enerating a significant increase in demand. In
addition, rollover protective structures (ROPS)
became standard equipment on all vehicles built
in model year 2002. In August 2002, we launched a
new, small-scale machine, the PistenBully Canyon.
This versatile and light 86-horsepower vehicle can
be used in locations that wheel-driven vehicles can-
not reach. The PistenBully Canyon is boosting our
business beyond our traditional ski slope activities
and enabling us to develop new customer segments.
BeachTech sales declined for the first time
compared with the prior year. The reasons for this
are the weather-related disasters in our main
market of Spain, where beaches were literally
washed away, and the general reluctance of
public-sector customers to purchase equipment.
We were, however, able to develop new, promi-
sing markets in Australia, the USA, and Thailand,
although this did not completely make up for the
decline in sales in Europe. All in all, we clearly
consolidated our position as the market leader.
In the coming season, we anticipate that this
business will revive, particularly thanks to the
launch of the extremely promising new self-
propelled BeachTech Marina.
32
Rolf Glessing
Dr. Hendrik Grobler
In fiscal year 2001/2002, the Supervisory Board
was briefed by the Managing Board on the intended
business policy, fundamental issues of future
management, the position and development of the
Company and on significant business transactions
by way of regular written and oral reports. It also
advised the Managing Board on these issues.
During fiscal year 2001 / 2002, the Supervisory
Board was briefed in depth by the Managing
Board on the Company's position in four meetings
evenly spaced throughout the fiscal year. Two
meetings were held per calendar half-year. All
Supervisory Board members attended every
meeting. The focus of the Supervisory Board's
advice was on market and business development,
corporate planning, investments made (particularly
the construction of the new facility in Laupheim),
the Company's annual financial statements, the
ongoing monitoring of existing commitments at
its branches and subsidiaries and the Managing
Board's risk control system.
The Supervisory Board also examined key
individual business transactions and passed
resolutions on transactions submitted for its
approval. Between the regular meetings, the
Chairman of the Supervisory Board was in
regular contact with the Company's Managing
Board. Moreover, the Supervisory Board was
continually briefed about the financial perfor-
mance of the Company and market data via
monthly reports.
As the Supervisory Board only comprises three
members, it has refrained from forming any
committees.
The annual financial statements and the consoli-
dated financial statements of Kässbohrer Gelän-
defahrzeug AG as well as the combined manage-
ment report and group management report for the
fiscal year from October 1, 2001 to September 30,
2002 were audited by Prof. Dr. Binder, Dr. Dr.
Hillebrecht & Partner GmbH Wirtschaftsprü-
fungsgesellschaft-Steuerberatungsgesellschaft,
Stuttgart – the auditors appointed by the General
Meeting – and submitted by the auditors to the
Supervisory Board together with the audit reports
in good time before the meeting relating to the
financial statements on December 10, 2002. The
auditors reported on their audit as a whole and on
the individual focuses of the audit at this meeting
on the financial statements, and provided detailed
responses to all questions posed by the Super-
visory Board. The audit opinions on the annual
financial statements of the Aktiengesellschaft
(AG) and on the consolidated financial statements
were issued without qualification; the Super-
visory Board noted and approved the results of
the audit.
The Supervisory Board examined the annual
financial statements of the Aktiengesellschaft, the
consolidated financial statements, the combined
management report and group management
report, and the proposal by the Managing Board
for the appropriation of net retained profits. It did
not raise any objections on completion of its
inspection. The Supervisory Board approved the
annual financial statements of Kässbohrer Ge-
ländefahrzeug AG, which have therefore been
adopted in accordance with section 172 (1) sen-
tence 1 of the AktG (Aktiengesetz – German
Public Companies Act). The Supervisory Board
concurs with the Managing Board's proposal on
the appropriation of net retained profits, and has
noted and approved the consolidated financial
statements.
The Managing Board presented the dependent
companies report to the Supervisory Board in ac-
cordance with section 312 of the AktG. The audit
report prepared by Prof. Dr. Binder, Dr. Dr.
Hillebrecht & Partner GmbH Wirtschaftsprü-
fungsgesellschaft-Steuerberatungsgesellschaft,
Stuttgart, in accordance with section 313 of the
AktG was also presented to the Supervisory
Board. The auditor issued the following opinion
on the basis of the unqualified audit:
"On completion of our audit in accordance with
professional standards, we confirm that
1. The factual statements made in the report
are correct;
2. The Company's compensation with respect
to the legal transactions listed in the report
was not inappropriately high;
3. There is no evidence to indicate that
conclusions materially different than those
reached by the Managing Board are appro-
priate for the measures listed in the report."
The Supervisory Board audited the report of the
Managing Board on relationships with affiliated
companies in accordance with section 314 of the
AktG.
The Supervisory Board expressed no reservations
about this report, and it noted and approved the
audit report prepared by the auditor on the
Managing Board's report.
The Supervisory Board would like to acknowledge
the hard work and commitment of the members of
the Managing Board, the authorized signatories of
Kässbohrer AG, the managers of the branches and
subsidiaries, and all employees of the Kässbohrer
Group.
Laupheim, December 2002
The Supervisory Board
Ludwig Merckle, Chairman
54
Report of the Supervisory Board.
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"The fun time to be had on ski slopes and trails and in
snow parks is no coincidence – it is only possible thanks to
our knowledge of nature and intelligent management of
the valuable resource of snow …
… Done."
Winter vacations in the ski paradises of this world
have reached new heights of quality. Dream
slopes for all skill levels, snow parks and cross-
country trails attract as many visitors as wellness
oases, gourmet palaces, shopping centers and
aprés-ski parties. And if that is not enough, you
can also mountain bike in the snow, ice climb or
participate in many other activities. Variety, chang-
ing activities and entertainment from early in the
morning until late at night are what is called for
today – to ensure an eventful winter vacation. The
fact that this concept is successful is confirmed
by the rise in the number of overnight stays in
regions reachable by car. Thanks to the extensive
selection of sports, leisure, and relaxation oppor-
tunities offered in ski resorts, winter holidays are
now decidedly more attractive to vacationers of
all ages: including families, young people and
grandparents who travel with their grandchildren.
From vacation sport to leisure-time activity.
Over 40 % of young people consider skiing and
snowboarding to be their dream sports. But only
5–6 % can actually participate in these sports due
to the locations in which they live, among other
things. For this reason, indoor sports centers in
large metropolitan areas far from the Alps are
vital to the forward-looking development of
winter vacation activities. They familiarize
patrons with these activities and enable them to
try out different winter sports, as well as helping
put together lacking equipment and booking over-
night stays. All in all, indoor sports centers in
non-mountainous areas attract people to winter
sports and ensure an increased stream of winter
vacationers to ski regions. Skiing events in cities
such as the kick-off to the cross-country skiing
world cup in Düsseldorf create additional interest.
Searching for adventure.
Guest satisfaction begins with high-quality
slopes. That is true for indoor sports centers,
downhill slopes and snow parks alike.
Snowboarders have particularly high standards.
These mostly young athletes expect perfect half-
pipes with sharply defined rims and excellent
transitions. The exacting design of snow parks
requires a great deal of expertise and experience
in addition to innovative equipment such as the
PistenBully 300 ParkBully and PipeMagician.
This is why, Kässbohrer Geländefahrzeug AG
organized its third snow park camp. This camp
enables drivers to perfect their skills in constructing
steep curves, jumps and half-pipes with the Pisten-
Bully 300 ParkBully and PipeMagician in theory
and in practice. The popularity that this event has
attained in the meanwhile is underscored by the
international roots of the more than 200 partici-
pants. They came not only from the Alpine coun-
tries, but also from Iceland, Japan, the USA,
Korea, Spain, and even New Zealand. This fact
also illustrates how important perfectly groomed
snow parks are for ski resort operators. After all,
they are a guarantee for attracting the loyalty of
younger target groups.
9
1. "Totally Board" in Marseille,
France: The organizers take their
winter sports events even to regions
not known for them.
2. Kick-off to the cross-country ski-
ing World Cup in 2002: 2,500 m3 of
machine-made snow was used in
Düsseldorf to create a track for the
sprint races and prepared using a
PistenBully.
3. PistenBully 300 W in Munich's
Olympic Park preparing the track
for a snowboarding contest.
4. An increasing number of indoor
skiing arenas are making winter
sports a viable option all year-round
in areas far from customary winter
sports regions.
8
Fun, Snow and Sports:
An Adventure on the Slopes.
What makes winter sports so enduringly attractive? They offer young and old
alike many opportunities for physical activity in an impressive setting. And
today the mountains are not the only place for a wonderful experience …
Forward-looking thinking and action are more
important than ever for the winter sports industry.
That is why ski resort operators
the world over count on cutting
edge technology by Kässbohrer
Geländefahrzeug AG. They
know that when we develop
our vehicles, winter sports
trends are always a considera-
tion and perfect slopes always
the goal. That always puts us a
step ahead so that with each
PistenBully our customers
purchase, they are receiving a
state-of-the-art vehicle, as well
as a future-oriented solution
for the trends of tomorrow.
More benefits –
more success.
Our new vehicle business is the
proof: technologies that enable
operators to shape slopes
efficiently or that simplify
slope maintenance are particu-
larly in demand. A compelling
example of this is the new
PistenBully 300 Polar with its
SNOWtronic intelligent tiller
control. Depending on the
processing mode set in the
tiller control, slope contours
are automatically maintained,
reinforced or smoothed without requiring the driver
to manually adjust the controls. The advantages of
this newly developed technology exclusive to
PistenBully are clear to see. Moguls can be shaped
precisely along the natural topography of the site
and expensive machine-made snow processed par-
ticularly gently. In addition, we have also seen
increased demand for our winch machines. The
snow transported down the mountain by skiers can
be shifted back up much more efficiently using
winches. The coordinated interaction between the
vehicle`s forward motion and the pulling action of
the cable means that the snow tiller can prepare
excellent-quality slopes. That is why the forward-
looking PistenBully 300 Polar with SNOWtronic
automatic tiller control is also available in a winch-
equipped model.
The safer the better.
PistenBully also fulfills tomorrow's standards
today in terms of accident prevention. All
PistenBully models have already been certified in
accordance with DIN 30770 and ÖNORM 9850
ROPS, the rollover standard that will become a
legal requirement in April 2003. In technical
terms, this means that the PistenBully's resilient
steel-tube frame absorbs most of the energy in
a possible rollover, making the driver's cab
particularly safe. The ergonomically designed
cockpit also contributes substantially to driving
safety and enables the driver to concentrate on
the work at hand.
11
1. The new winch now features an
innovative early warning system that
helps to prevent cable breakage.
2. The intelligent SNOWtronic tiller
control makes it possible for users to
more precisely sculpt terrain features
and contours.
3. The new PistenBully 300 Polar is
our new premium vehicle for slope
preparation. Of course, it features
the new SNOWtronic tiller control.
4. The cockpit of the PistenBully 300
Polar is equipped with a new multi-
functional screen that displays all
key data needed to operate the
vehicle, the tiller and the winch.
10
Setting Trends With Our Future-Oriented Vehicles.
Winter sports regions today require innovative, flexible equipment for
shaping slopes intelligently, meticulously and cost-effectively. And a visionary
partner to develop these vehicles.
Overall cost-effectiveness depends on many
factors: the purchase price, vehicle performance,
operating costs, service intervals, frequency of
repairs, rapid diagnosis of problems, speed of
spare part delivery, and the vehicle's life and its
ability to retain value. All of these details are
perfectly integrated in the PistenBully and
contribute to an excellent bottom line – a key
aspect for our customers who also choose
PistenBully for its low life-cycle costs.
A successful connection.
In particular cost-effectiveness requires a more
efficient working style. This is made possible,
among other things, by the new large snow
blade and the excellent clearing power of the
PistenBully 300 Polar, which enables large
masses of snow to be moved in a single step – for
significantly more rapid distribution on the slopes
of the large amounts of snow created by snow
guns.
The optimal ratio of ground speed to tractive
force in our winch-equipped vehicles guarantees
more efficiency in slope maintenance. On the
whole, the price per square meter of slope to be
prepared is increasing in importance as a factor in
purchasing considerations. When all factors come
together as well as they do in the PistenBully,
purchasing high-quality slope maintenance
vehicles is worthwhile.
High-tech features for reliability.
At SAM, the international winter technology
trade show held in March 2002 in Grenoble,
France, we displayed our PistenBully vehicles
with many new technical highlights. For example,
the Rope Failure Detector on our new winch-
equipped vehicles is a type of early warning
system that monitors the cable constantly to iden-
tify damage and warns the driver of problems
using acoustic and visual signals. This enables
operators to optimally utilize the full life of the
cable and to reduce costs by using the cable as
long as possible.
Thanks to the new on-board computer in the
PistenBully 300 Polar, drivers can read all of the
key information required to operate the vehicle on
a multifunctional display. This makes it easier for
drivers to monitor operating conditions and to
steer the vehicle – and, if something were to go
wrong, this system also simplifies error detection
and diagnosis.
Maintenance can wait.
Many improvements, such as the new winch
system, chassis and tracks ensure an even longer
life for our vehicles, as well as reduced mainten-
ance. This is not the least of the reasons that the
PistenBully retains its value very well and has an
excellent resale value.
13
1. The PistenBully 300 W transports
large amounts of snow straight up
the mountain while treating the
slopes gently.
2. Improved track technology.
Thanks to improved tensile strength,
reinforced track connection joints
and a higher level of ozone-resi-
stance of the belts, Kässbohrer
vehicle tracks have a long useful
life.
3. The PistenBully 300 ParkBully is
specially designed for terrain park
maintenance and can shape jumps,
spines and rollers simply, quickly
and precisely.
12
Consider the Factors Before Storming the Summit.
Why is operating a PistenBully more and more cost-effective for our
customers over time? Because with this goal in mind, we continually work
on, develop and improve even the smallest details …
A well-developed concept is the key to an inter-
nationally successful product range such as the
PistenBully family. This enables us to offer optimal
products tailored to specific requirements, as well
as cost-effective solutions. It was this approach that
we used to develop our product range, which unites
vehicles from complementary performance classes
and application areas. Our customers have no
trouble finding the right PistenBully for all slope,
trail and snow park maintenance jobs, as well as
landscaping applications. Our PistenBully vehicles
are a welcome sight anywhere where performance,
reliability, and flexibility are particularly important.
Small, but it packs a punch.
The new PistenBully Canyon is the smallest,
lightest and most flexible vehicle in the
PistenBully family. It is perfectly suited for trans-
portation jobs in difficult-to-access terrain.
Multi-talented.
The PistenBully 100 is a true all-around vehicle
for first-rate preparation of cross-country trails,
snowmobile trails, hiking paths, chair and surface
lift tracks, and even small slopes. This vehicle is
also well suited for use as a slope taxi and trans-
port vehicle and its particularly low-emission
drive technology means that it is a popular choice
in many indoor sports centers. The PistenBully
100 All Season and Flexmobil model can be used
for applications well beyond the snow.
Always in the thick of things.
The PistenBully 200 is the mid-weight vehicle for
standard preparation tasks. This vehicle can pre-
pare large areas while using comparatively small
amounts of fuel and is optimally suited as a fleet
vehicle. The PistenBully 200 is the ideal solution
for operators that want to combine effective slope
preparation with the lowest possible operating
costs.
The pinnacle.
The 300 series comprises high-tech vehicles for
slope maintenance featuring state-of-the-art
equipment that should not be lacking in any fleet
and includes the new PistenBully 300 Polar, the
300 W and the PistenBully 300 Antarktica.
The flexible specialist.
Special jobs require extraordinary solutions. This
is how the PistenBully 300 ParkBully was created.
This vehicle is our specialist for terrain park
maintenance featuring a front snow blade and rear
tiller with a unique range of motion to enable the
vehicle to optimally build up and shape the snow.
This vehicle concept is supplemented by the inno-
vative PipeMagician add-on that can carve out
half-pipes with a constant radius six meters high.
ParkBully and PipeMagician together are the
ideal equipment for professional terrain park
maintenance.
15
1. PistenBully 100 – for
professionally groomed trails.
2. The PistenBully Multiflex tiller
features a hydraulic, performance-
optimized drive for optimal prepara-
tion and terrain shaping.
3. The PistenBully 300 Polar with a
winch is the crème-de-la-crème of
modern slope maintenance.
4. An all-around vehicle:
the PistenBully 100 with passenger
cabin can be used as a slope taxi,
especially in rough terrain.
14
Excellent Performance: All in the Family.
How did we get to the top worldwide? By developing first-class solutions for
a wide variety of applications and requirements based on a technically
sophisticated platform.
The PistenBully 100 and 300, which are specially
equipped for Antarctic expeditions, can withstand
extremely cold conditions and face up to Mother
Nature even at -50°C.
Trust built through the best of experiences.
Teams from Europe, Asia, and the USA choose
the Antarctic-equipped PistenBully as their
partner for expeditions because PistenBully has
proven to be so reliable under these extreme
conditions. Whereas the PistenBully 100 is
primarily responsible for transporting people, the
Antarctic series PistenBully 300 is a real work
horse. We can build on more than 20 years of
experience – we developed the first Antarctic
series PistenBully in 1980.
New impetus for development.
This Antarctic experience flows into the develop-
ment of PistenBully models for conventional
uses. The knowledge about the stresses of opera-
tion under extraordinary conditions help us to
make the PistenBully even more reliable.
A robust start to the season
The PistenBully 300 Polar and the new Pisten-
Bully 300 W represent the launch of even more
robust and high-performance versions of the 300
series models. Equipped with many new features
and improvements, they are an excellent example
of the innovative power of Kässbohrer Gelände-
fahrzeug AG. And a further step toward securing
our market leadership for the long term.
17
1. At Atka Bay near the German
Neumeier station: containers are
loaded from a ship to large sleds
that are then pulled by a PistenBully.
2. From the steel we use to the
hydraulic system and the vehicle's
starting capabilities – the entire
vehicle must be equipped to handle
extreme temperatures.
3. The Chinese station also uses the
PistenBully for its transportation
needs.
4. Each year, one of our service
technicians is on-site to undertake
necessary service and maintenance
work on the vehicles.
16
A Daily Joy in Icy Regions?
PistenBully on the Rocks.
If you intend to visit the Antarctic, you should dress warmly. And rely on
PistenBully. With more than 20 years of Antarctic experience, we know all
about the special equipment required for extreme conditions.
… Done."
"Driving in highly sensitive areas with minimal pressure.
Carefully and responsibly ensuring transportation in
extremely difficult-to-access terrain or even in highly sen-
sitive natural landscapes – those are the jobs that prove to
be a particular challenge again and again …
PistenBully vehicles have many advantages. One
of these is the low center of gravity of these
vehicles, which protects against rollovers.
Another is their maneuverability – that enables
our vehicles to turn on a dime thanks to the rever-
se motion of their caterpillar tracks. Yet another
advantage is the even distribution of pressure over
the entire footprint of the track. This makes the
surface pressure so minimal that the PistenBully
has no problem driving in deep snow, in wetlands
or on the forest floor – without sinking. Our rub-
ber tracks also mean that sensitive ground surfa-
ces can be treated with particular care.
Flexible due to significantly more grip.
Our newly developed MultiGrip track has
enabled us to add an all-around track to our
range that was developed in cooperation with
a rubber and tire specialist for use on various
surfaces and in different seasons. This track
makes PistenBully even more flexible. Thanks to
its excellent grip on thin snow cover and snowy
slush, as well as on gravel, mud, or asphalt, this
all-around track guarantees comfortable trans-
portation under almost all conditions.
Fun in all types of terrain.
Small, sophisticated and absolutely suited to all
types of terrain, the new PistenBully Canyon
offers all of the qualities of a reliable off-road
vehicle, but also features far greater mobility off
the road than conventional all-wheel drive
vehicles. And it is as easy to drive as a car. The
new MultiGrip track makes this vehicle secure on
all types of surfaces and in any kind of terrain.
The places where wheel-driven vehicles are
stopped in their tracks are where the challenge
starts for PistenBully Canyon.
With these features, this vehicle has enabled us to
develop new customer segments, including
telecommunications antenna, wind farm, and
utility company maintenance, as well as classic
supply vehicle applications. The latter include
users such as mountain cabin managers, hotel and
chalet operators, managers of large hunting
grounds, and owners of large private properties
only partially accessible by road. Potential custo-
mers even include private individuals who simply
enjoy off-road driving. We see an interesting and
promising market ahead for all-terrain vehicles
such as the new PistenBully Canyon, especially in
North America.
21
1. The PistenBully 100 Flexmobil:
the maneuverable track-laying
vehicle that can easily be used in
terrain that is impassable for
wheel-driven vehicles.
2. The PistenBully 300 can be
used to recultivate peat fields:
rubber tracks and minimal surface
pressure make it possible for this
vehicle to be used on soft ground.
3. The new MultiGrip track:
thanks to this new all-around
track for various surfaces, the
PistenBully Canyon is as secure
in mud as on asphalt.
4. The PistenBully Canyon is
ideally suited for transportation
in difficult-to-access terrain.
20
We gladly face mud, water, and swamps to
develop new applications.
Vehicles that do not let snow and ice stop them can handle all sorts
of tasks. And PistenBully reveals unexpected qualities in rough terrain
far from paved roads …
The PistenBully 100 All Season is an all-around
vehicle for all seasons. A total of seven tracks are
available for use on many
different surfaces: for example,
the wetlands track featuring the
lowest possible surface pres-
sure prevents damage to flora.
Numerous kinds of add-on
equipment can be attached
using a universal interface and
a three-point hitch that complies
with international standards.
Depending on the type of
equipment added, the Pisten-
Bully 100 All Season can
become a mowing or mulching
vehicle, an excavator, a fertilizer
distribution vehicle, a trail
specialist, a slope groomer or
snow removal vehicle. The
application options are many
and varied and the target group
is correspondingly large. This
vehicle's multifunctional nature
makes it an ideal choice for
municipalities, private com-
panies, forestry operations,
agricultural uses, and operators
of small ski resorts – anyone
looking for a vehicle for many
different tasks.
The third link.
Another multifunctional vehicle is the Pisten-
Bully 100 Flexmobil, which was developed
primarily for transportation purposes. In tests on
military training grounds, this vehicle had to
prove its reliability and ability to handle the ter-
rain. Thanks to its low center of gravity, 700 mm
broad rubber tracks and a wading depth of 60 cm,
this vehicle is ideally suited for all types of
challenges. Its top speed of 40 km/h and 170
horsepower engine enable the PistenBully 100
Flexmobil to drive rapidly on difficult terrain.
When equipped with a passenger cabin, it can
carry up to eight passengers or 1,000 kg of
material. Without the cabin, the PistenBully 100
Flexmobil can carry an additional 500 kg.
Trial by fire.
Fire does not stop for difficult-to-access terrain.
That is why the PistenBully 100 Flexmobil is now
available with special add-on fire-fighting equip-
ment in the form of the PistenBully Fireflex. This
all-terrain vehicle features a foam spraying high
pressure nozzle, a 600-liter tank for fire-extin-
guishing material and a rapid-deployment hose
reel, plus 80-meter of hose. Thanks to its compact
size, this highly maneuverable vehicle performs
excellently even in cramped conditions. These
unique features make the PistenBully Fireflex an
optimal addition to fire department, disaster
relief and mobile airport fleets.
2322
The Universal-Use Vehicle.
(OK, We Admit It: It Won't Ever Fly.)
Vehicles that aim to do more than all the others require a solid foundation.
Plus various tracks and versatile add-ons that make the PistenBully even
more flexible …
1. The PistenBully Fireflex is based
on the PistenBully 100 Flexmobil
with add-on fire-fighting equipment.
2. The PistenBully 100 All Season is
always needed. Its multiple types of
add-on equipment mean that it can
be used in winter as a rotary snow
plow...
3. ... and in the summer as a
mowing vehicle.
4. Our PistenBully vehicles are at
home in steep terrain and field
clearing work in areas such as the
vineyards of the Mosel region.
PistenBully vehicles are very much in demand on
the used vehicle market. In fact, they often change
hands twice or more. To ensure
that our customers can rely
unequivocally on used vehicles
made by Kässbohrer Gelände-
fahrzeug AG, the technical
and optical condition of each
vehicle is examined carefully.
The results are then set down
in black and white in a test
report.
The three categories.
Our used vehicle customers
have very different require-
ments. That is why we offer
used PistenBully models in
three categories. "Economy"
class vehicles have passed a
technical check in line with
the test report. All other work
is undertaken by the customers
themselves who want to cut
costs. Vehicles in the "Stan-
dard" category are perfect in
the technical sense and can be
used immediately. The tracks
and attachments have also
been overhauled. The highest
category, "Premium", is reser-
ved for top-quality vehicles.
These vehicles are almost as
good as new because they have been overhauled
both technically and optically, and they feature a
used-vehicle guarantee from Kässbohrer Gelän-
defahrzeug AG.
A new application, please.
Not all used PistenBully vehicles find their way
back to the slopes. Some enjoy completely new
opportunities. Used PistenBullys are often
re-equipped for new tasks – ranging from agri-
culture and forestry to oyster farming, from
vineyards and peat mining all the way to structural
and civil engineering. Owners like to use these
vehicles for unusual applications thanks to the
unique ability of the PistenBully to handle
different types of terrain:
For example, a 200-series PistenBully moves
large volumes of mud out of the port of Hamburg.
Another PistenBully 300 is helping with peat
mining and recultivation in Northern Germany's
Emsland region. A winch-equipped vehicle is
being used for field clearing in the steep Mosel
vineyards. And another PistenBully with a winch
was used successfully during construction of the
Goldisthal pump-fed power station in Thüringen
to build the wall dams. All of these applications
point to the potential in our PistenBully vehicles.
And the opportunities that even used vehicles
hold for the future of our company.
25
1. The 5th International Used Vehicle
Show was held in our new facility in
Laupheim for the first time.
2. Well-cared for used vehicles are
particularly in demand in Eastern
Europe.
3. PistenBully vehicles are used on
particularly sensitive ground for
environmental protection.
4. PistenBully removing mud from
ponds: moving large volumes of mud
effortlessly thanks to its excellent
thrust.
24
Legally Speaking They Are Called Used Vehicles.
We Prefer to Call Them Experienced.
PistenBully vehicles are long-lived and may start afresh several times. And
we prepare them well for that. They are tested and monitored for a
successful future in their new lives.
… Done"
"Who doesn't like to stroll along dream beaches in paradise?
That is why we are on the move for you – to keep them clean
for those who follow …
Small, very versatile, equipped with all-wheel
drive and multifunctional to boot – these qualities
ensured that the BeachTech Marina attracted a lot
of attention at its initial presentation at the end of
2001. This vehicle is the first beach maintenance
vehicle on the market that combines a towing
vehicle and our proven cleaning technology in a
single vehicle concept – in line with our product
philosophy for all-terrain vehicles.
Welcome – any time.
Its compact footprint and tight turning radius
mean that the BeachTech Marina can even
maneuver between rows of beach chairs, making
cleaning and maintenance much easier. Because
this compact vehicle with its attractive all-terrain
vehicle design is well received, guests are willing
to accept daytime beach cleaning without
complaint. Elsewhere, too, the small vehicle is
useful for many beach grooming and guest service
tasks. Because operators can receive permission
to use these vehicles on the roads, sun umbrellas,
chairs and more can be easily transported from
one beach to another.
The category I three-point hitch enables equip-
ment such as lawn mowers, roller brooms, rake
screens, or snow clearing blades to be attached.
This turns the BeachTech Marina into a multi-
functional vehicle that has high season all year-
round, whether this means cleaning walkways,
grooming lawns, or clearing snow in winter.
Thanks to its multifunctional nature, this vehicle
is in use 50% to 100% more of the time than
regular beach cleaning equipment.
The many application options for the BeachTech
Marina increase the cost-effectiveness and value-
added of this investment many times over. Cities
and municipalities are thrilled because this small
and versatile vehicle enables them to perform
many municipal tasks. These qualities make the
BeachTech Marina ideal for hotel complexes,
small beaches or swimming facilities.
A free hand at the track.
What is good for one, can be good for the other.
That is why our BeachTech Marina is also used to
clean and maintain riding facilities. Well-groomed
sand that is devoid of small stones and horse
manure, that is optimally graded and conditioned,
guarantees perfect conditions at the track for both
horses and riders.
29
1. The new BeachTech Marina is so
compact and maneuverable that it
can even drive between crowded
rows of beach chairs.
2. The patented cleaning technology
is also suitable for maintaining
equestrian facilities.
3. The three-point hitch enables
users to attach various add-on
equipment, such as a roller broom
for cleaning walkways and streets.
4. The large load bed is suited to
transporting luggage, equipment and
much more.
28
How Do You Get Where You Want to Go in the
Summer? Using Your Own Power on New Terrain.
Beautiful, clean, groomed sand is in demand not just on beaches, but
also for leisure activities and sports. Another reason to develop new
markets with a proven technology.
Beach vacations are still the top dream destination
for the world's holidaymakers. Swimming, sun
tanning, relaxing and feeling
good – guest expectations are
particularly high at the beach.
At the same time, pollution is
increasing all the time. It is
estimated that twelve million
cigarette butts are buried in
Italy's beaches alone. Each
square meter of sand contains
an average of two cigarette
butts. To take care of this
problem quickly and easily,
municipalities and beach
operators are increasingly
turning to efficient BeachTech
technology by Kässbohrer
Geländefahrzeug AG, the
market leader. With this
unique, patented sifting, raking
and mixing technology that
enables a smooth shift from
surface to in-depth cleaning
depending on the contamina-
tion level, large and small
impurities, corks and cigarette
butts are removed from the
sand whatever the weather.
High performance on beautiful days.
Although this market is still comparatively new,
BeachTech technology has become synonymous
with thorough, professional sand maintenance.
Experienced users can tell from the typical finely
structured pattern in loose sand who has been at
work: BeachTech 2000 and 3000 were developed
especially for high-performance cleaning of
medium to large beaches.
Many municipalities in tourist centers such as
Marbella in Spain, Bibione in Italy, The Hague in
The Netherlands, or Key West in the USA
maintain their beaches with BeachTech fleets
consisting on average of four or five vehicles. The
City of Chicago even runs advertisements for its
beaches that are cleaned and groomed using
BeachTech equipment.
There are now hardly any well-known beach
regions that are not kept clean using BeachTech.
We were even able to develop the Australian
market last fiscal year. In Melbourne, Sydney and
Brisbane, BeachTech vehicles are now on the
move – along with a new fleet in Thailand.
31
1. BeachTech 2000 and 3000 are
used by municipalities as fleet
vehicles for cleaning large beaches.
2. Kässbohrer Geländefahrzeug
AG's patented sifting, raking and
mixing technology enables surface
and in-depth cleaning of damp ...
3. ... and dry sand.
4. BeachTech vehicles can pick up
even crown corks, cigarette butts,
glass shards and oil clumps.
What Do You Expect From Us? A Beautiful Beach.
Clean Sand. And a Good Vacation.
Why are BeachTech vehicles the undisputed global leaders in beach
cleaning? Because they do in one step what 60 million vacationers
expect from their dream beaches each year.
30
… Done."
"We have set the course for our future: our efficient working
practices and clear workflows allow us to we react quickly
and flexibly to customer needs …
The construction of our new factory in Laupheim
near Ulm, including the move, took only one year:
a short amount of time in
which 31,000 square meters
of office, assembly and ware-
house space were created. And
in which all of our employees
moved without adversely
affecting manufacturing, de-
livery obligations, marketing
activities, or customer service.
This is an amazing feat,
especially considering that we
launched a series of new
products at the same time. At
the end of February 2002, we
commenced production in our
new factory.
Best conditions in
a single location.
Constructing this new build-
ing gave us the once-in-a-
lifetime opportunity to com-
pletely rethink and redesign
all of the workflows in the
company. The result was that
we were able to reduce
logistics costs considerably.
Short distances, more rational
processes and optimized
material flows led to an
improvement in efficiency.
The close proximity of all departments to one
another encourages communication and the
exchange of ideas with the result that cooperation
has increased substantially in quality overall. We
are proud that we have succeeded in keeping our
entire team together despite the move. That means
that we can now even more effectively feed the
knowledge and experience of all participants into
our work.
Binding insights.
In planning the new factory, we placed a great
deal of importance on using an open architectural
style that promotes cooperation and communica-
tion within the company, as well as contact with
our customers. Proximity to the product is a
decisive factor in this regard. Now we can offer
our customers the opportunity to familiarize
themselves with the production process for their
all-terrain vehicles when they visit for meetings
and attend training sessions – an idea that was
received very positively by actual and prospective
customers at our customer week in June 2002. If
they can follow the creation process of the
vehicles from the very beginning, the emotional
link and identification with the product is much
higher.
35
1. The new facility in Laupheim
covers 31,000 square meters and
offers enough space for our future
growth.
2. The consolidation of all depart-
ments under one roof has further
improved cooperation and efficiency
within the company.
3. The new light, open-plan rooms
create a pleasant working
atmosphere.
4. Customers can now take a peek at
our production process and the
creation of their vehicle when they
visit our factory.
34
Even Global Leaders Sometimes Need a Changeof Perspective.
Success is not just a question of excellent ideas, but also the result of a
consistent working method, committed implementation, and a staff that is
solidly behind these approaches.
Our fourfold quality control process also
ensures the faultless condition of our PistenBully
and BeachTech products alongside our expertise
in development, production and assembly. Quality
assurance begins with our suppliers where it is
our aim to purchase the highest quality com-
ponents and materials. For this reason, we esta-
blish the criteria in a new joint audit each year so
that we can incorporate new knowledge,
experience and requirements. These are laid down
in the current set of specifications.
Testing in state-of-the-art test beds.
The next step in our quality assurance process is
careful inspection of incoming goods. We invested
in innovative measuring equipment with a direct
link to the CAD system in our design department.
This equipment measures the dimensional
accuracy and quality of components and materials
down to one-thousandth of a millimeter. After
assembly, each PistenBully is subjected to a
challenging two-to-three hour test. And it was for
this purpose that we invested in two state-of-the-
art test beds when constructing the new factory.
They allow us to perform precision testing on the
engines and engine control systems, the drive and
steering electronics and the brakes. This testing
process includes simulating all imaginable types
of terrain and stresses on the vehicles and
comparing the measured values with the
specifications. Only those vehicles that meet the
strict quality control standards are released for
shipment after a final check. Some parts
particularly prone to wear and tear, such as the
vehicle tracks, are also tested for durability under
long-term use with the help of special test beds to
ensure long life.
The last stage of our quality assurance process is
the final check. The results of testing in the test
beds are documented and possible defects
rectified. After everything has been checked
again, documented, and countersigned, the final
condition of the vehicle is certified and the vehicle
is released for shipment.
Environmental protection is important.
As a provider of technology for nature, leisure
and landscape maintenance, the environment is
extremely important to us. That is why we
strongly emphasized environmental protection in
designing the entire facility. A good example of
responsible use of a resource such as energy is the
brake units in the test beds. They function like
generators and convert released energy into
electricity. The approximately 150,000 kWh per
year we produce in this manner is fed back into
the electric power grid.
37
1. The care and clear quality orien-
tation of all employees enable us to
build the high-quality vehicles for
which we are known.
2. State-of-the-art measurement
technology in incoming goods
inspection guarantees that only
the best quality materials are
used in production ...
3. ... with a lot of loving attention to
detail.
4. The new test beds for the
multi-hour PistenBully tests
convert energy that is released
while braking the engines into
electricity. This electricity is fed
back into the grid.
Tested, Improved. Tested Again – And Improved
Even More.
We consistently implement in quality control what is defined in product deve-
lopment. Our vehicles are systematically tested, updated and improved. First-
rate products that everyone can rely on.
36
Our customers' first priority is the constant
availability of their vehicles. For this reason, we
have developed a concept that offers them a wide
range of service components: from clear and
easy-to-understand vehicle documentation and
operating manuals to training sessions for drivers
and assembly technicians through to a hotline and
spare part service and visits by customer service
technicians. All of this together is the secret to
Kässbohrer Geländefahrzeug AG's customer
service offering, which is known for its pro-
fessionalism.
Training comes first.
The construction of our new factory also gave us
the opportunity to further improve our training
program. We can now introduce drivers and
assembly technicians to our vehicles in a more
realistic manner in our three new training rooms.
In addition to a theoretical training classroom, a
training workshop with a vehicle pit for the
PistenBully and a component room are also
available, allowing vehicle details to be presented
using hands-on demo models and PistenBully
components. Thorough training is very important
to our customers. Well-trained drivers and
vehicle technicians are extraordinarily important
operating capital for the operators of ski resorts.
But that's not all. They are also responsible for the
best possible slope grooming, as well as compe-
tent maintenance which translates to constant
availability of the vehicles.
The more detailed their knowledge of the
PistenBully is, the better they can fulfill these
requirements. Our experience shows that when
employees really understand the vehicle techno-
logy, their enthusiasm about their work grows and
motivates them to achieve even better results. This
increases their confidence in our product and
boosts customer loyalty. Each year, 500 to 600
drivers and mechanics participate in our training
courses.
A contact is always available.
Personal contact is extremely important in our
business. That is why our highly qualified customer
service engineers are available to help customers
during and after commissioning of our vehicles.
In addition, we have also stationed regional service
technicians near our customers so that help is
always available quickly should they need it. In
addition, our experienced hotline troubleshooters
help our customers around the clock – even at
Christmas – and offer technical assistance by
phone.
39
1. The annual terrain park camp
teaches skills such as quickly and
professionally constructing
half-pipes with the ParkBully
and PipeMagician.
2. Drivers and mechanics are fami-
liarized with the PistenBully in indi-
vidual training sessions.
3. Theory and practice: our new
training facility offers the best
conditions for covering both in
depth.
4. Satisfied faces – close personal
contact with our customers is very
important to us.
38
We Like to Be Close to You: Which Is Why We Are
Always On-Site Everywhere.
What is the secret to Kässbohrer Geländefahrzeug AG's excellent service?
More than 70 service stations around the globe that are available to our
customers 365 days a year.
… Done."
"The strong commitment and personal effort of each
employee is the capital of a successful company. Companies
that invest in these values are the only ones that will lock
in long-term success and maintain it for their investors …
4342
RESEARCHBaden-Württembergische Bank AG evaluated KässbohrerGeländefahrzeug AG in November 2002 as part of a studyentitled "Shares of Baden-Württemberg Companies".According to analysts, Kässbohrer's shares are valued appro-priately at a level of € 12. Our shares received a "neutral"recommendation based on the difficult overall economic cir-cumstances and the strained situation in the tourism industry.
KÄSSBOHRER SHARES AT A GLANCE
INVESTOR DIARY
CORPORATE GOVERNANCECorporate governance stands for sound, responsible corporatemanagement and supervision oriented toward increasing thevalue of the Company. This effort is based on open and intensive cooperation between the Managing and SupervisoryBoards with the aim of promoting investor, customer, employee, and the public's confidence in the management andsupervision of public companies.
At Kässbohrer Geländefahrzeug AG, the principles of soundcorporate management and supervision now enshrined in theGerman Corporate Governance Code were already applied toa great extent in the past, and their essence is anchored in theCompany's memorandum of association.
The Managing and Supervisory Boards of KässbohrerGeländefahrzeug AG have used the implementation of theGerman Corporate Governance Code as an opportunity toexamine the Company's corporate governance policies. To thisend, they submitted the first declaration of conformity
regarding the recommendations of the government commission on the German Corporate Governance Code in accordance with section 161 of the Aktiengesetz (AktG - German Public Companies Act) on November 15,2002. As per the provisions of the AktG, this statement wasmade available to shareholders via the Internet on theCompany's homepage and will also be submitted to the commercial register.
The submitted declaration of conformity confirmed theCompany's compliance with the material recommendations of the German Corporate Governance Code. For specific reasons, the following are the only points in which theCompany has deviated from these recommendations:
• The current insurance policy for D&O insurance concludedfor the various members of the Managing and SupervisoryBoards does not include a deductible to be paid by the insured parties.
• The remuneration of the Supervisory Board members doesnot contain any performance-based components due to theprovisions of the memorandum of association.
• As the Supervisory Board only comprises three members, ithas refrained from forming any committees. This structureensures efficient and professional work by the SupervisoryBoard.
• No age limit is stipulated for Managing and SupervisoryBoard members. This issue is not critical at this time in viewof the age structure of the Managing and SupervisoryBoard.
• Because the shares of Kässbohrer Geländefahrzeug AG arealmost exclusively held by shareholders resident inGermany and the Company is not subject to a statutory obligation to do so, the consolidated and interim financialstatements have not yet been prepared in accordance with International Accounting Standards. The consolidatedfinancial statements for 2001/2002 will be made available to the public at the financials press conference on February 6, 2003.
Kässbohrer's Shares
Kässbohrer Geländefahrzeug AG is the global leader in bothof its business segments: ski slope preparation and beachcleaning. The Company's development opportunities areensured into the future thanks to its vehicle technologyexpertise for extreme-terrain applications and the furtherexpansion of its product range to include high-earning nichemarkets. This potential and the profitability of the Companymake Kässbohrer's shares attractive in particular to investorswith an investment horizon in the medium to long term.
Kässbohrer's share performance was in line with the weakstock market environment in 2001 and 2002. By the end ofSeptember 2002, Kässbohrer's shares had declined in valueby around 24 % compared to the previous year, whereas theDAX lost 35 % in the same period. The drop in our shareprice was caused largely by fragile investor confidence in thecapital markets, as well as developments in the tourism sector. After the events of September 11, 2001 and the downturn in the economy, the long run of growth in the travel industry was interrupted. This trend also influences thecurrent sales and earnings expectations of the tourism sectorand those of the companies that depend on this sector.
SHARE PRICE PERFORMANCE October 1, 2001 to September 30, 2002
Dax Kässbohrer
The majority of Kässbohrer Geländefahrzeug AG shareholdersinvest for the long term. The excellent performance of theCompany since the IPO and the enthusiasm for the Company'sproducts are the main reasons for investor loyalty toKässbohrer. Investments in Kässbohrer shares are not sold offeither in phases of strong share price gains or in a period ofshare price decline as in the previous year. This is also reflectedin the downward trend in trading volumes. In the past year, around 700 shares per day were traded on average.
STATISTICSSince leaving the SMAX index in December 2001,Kässbohrer Geländefahrzeug AG has been listed on theAmtlicher Handel of the Frankfurt Stock Exchange. Afterresegmentation of the stock market, Kässbohrer Gelände-
fahrzeug AG will be listed in the new General Standard seg-ment. This stock market resegmentation by Deutsche Börseonce again confirmed the correctness of our decision to leavethe SMAX. This listing was only of limited benefit to ourcompany due to high costs and the low (and declining) tra-ding volume of Kässbohrer shares. In the future, shareholders will continue to be briefed about theCompany's performance regularly by way of interim reportsand press releases containing high-quality information. We supply our shareholders and all others interested in theCompany with information in near real time via the Web sites www.pistenbully.com and www.beach-tech.com.Our publications are also available on the Web in English. A declaration of conformity by the Managing Board andSupervisory Board with the German Corporate GovernanceCode and an overview of corporate governance atKässbohrer Geländefahrzeug AG are also available on ourhomepage under Investor Relations.
DVFA/SG EARNINGSKässbohrer's DVFA/SG earnings amount to €1.32 per share.This is the second best result since the IPO.
1): Short fiscal year from April 1 – September 30, 2001: Due to seasonal influences, onlyabout 25% of sales for the year are generated in the months from April to September.For this reason, the short fiscal year shows a loss after only six months. The earningssituation in the short fiscal year is therefore not comparable to fiscal year 2001/2002.
DIVIDENDSThe Managing Board and Supervisory Board are proposingpayment of a dividend of € 0.30 per share for fiscal year2001/2002 to the General Meeting to be held on March 28,2003 in Laupheim. This corresponds to a dividend yield of2.5 % on the share price on September 30, 2002. The totalamount to be distributed is1.5 million. The amount of theproposed dividend was calculated on the basis of the netincome for the year, the Company's financing needs, and cur-rent business development.
(in € thousand) 2001/2002 Short FY 2001
Consolidated earnings after
minority interests 6,409 -4,122 1)
Special factors to be eliminated
Costs of relocation 741 345
Recognition of tax effects
Deferred tax income from branch offices
and subsidiaries due to losses – 713
Deferred tax expenses from branch
offices and subsidiaries due to profits -596 –
Tax adjustment for differing tax
recognition of provisions 68 49
DVFA/SG earnings 6,622 -3,015
DVFA/SG earnings per share 1.32 -0.60
Number of ordinary shares (in shares) 5 million
Average daily trading volume (in shares) 700
Market capitalization Sept. 30, 2002 € 60.5 million
2001/2002 high Oct. 1, 2001 € 17.00
2001/2002 low July 26, 2002 € 11.60
Closing price Sept. 28, 2002 € 12.10
DVFA/SG earnings per share € 1.32
Dividend € 0.30
Dividend yield (based on price of €12.10) 2.5%
P/E ratio 9
Financials press conference, Stuttgart February 6, 2003
Analyst conference, Laupheim February 7, 2003
Ordinary General Meeting 2003, Laupheim March 28, 2003
Dividend payment March 31, 2003
Quarterly report QI 2002/2003 February 2003
Report on the first six months of FY 2002/2003 May 2003
Quarterly report QIII 2002/2003 August 2003
Close of fiscal year 2002/2003 September 30, 2003
in %
140
120
100
80
60
Okt Nov Dez Jan Feb Mrz Apr Mai Jun Jul Aug Sep01 01 01 02 02 02 02 02 02 02 02 02
15,91
12,10
45
BUSINESS DEVELOPMENT IN FISCAL YEAR 2001/2002
As of September 30, 2002, Kässbohrer Geländefahrzeug AGcompleted its first full fiscal year after changing its reportingdate in 2001.
In the short fiscal year 2001, which only lasted six months(April 1 to September 30), the Company reported a negativeresult for the Group due to the strong seasonal dependenceon winter business. For this reason, the earnings situation infiscal year 2001/2002 can only be compared with the previous short fiscal year to a very limited degree. TheCompany's financial position as of September 30, 2002 is,however, fully comparable with that of the previous year.
CONSOLIDATED SALESKässbohrer Geländefahrzeug AG generated consolidatedsales of € 132.2 million in fiscal year 2001/2002. This is thesecond-best result in the history of the Company, despite theunfavorable developments in the global economy and thereluctance to invest in the tourism industry.
PISTENBULLYNew Vehicles: New PistenBully vehicles contributed € 87.1million to consolidated sales, which corresponds to around 66 % of total income. The volume of the global market for slope maintenance vehicles was about 10 % lowerin the past season than in the very successful winter of2000/2001. As the global market leader with a global marketshare of over 50 %, Kässbohrer Geländefahrzeug AG felt thisdevelopment directly. Due to the increasing demand for higher-value vehicles such as the PistenBully 300 and theParkBully, the decline in sales was proportionally lower thanthe drop in the number of vehicles sold. Moreover, demandfor high quality attachement tools for maintaining terrainparks rose.
Used Vehicles: Used PistenBully vehicles generated € 10.2million in the past season. This represents an increase of13 % over the muted demand in the 2000/2001 winter season.The Alpine countries of Austria, Switzerland, and Italy led insales of these vehicles. Additional used vehicles were soldduring the customer week at the new headquarters inLaupheim.
Spare Parts and Service: € 32.3 million in sales was gen-erated from spare parts and service. Sales in this area are largely dependent on the frequency with which vehicles areused during a season. Despite the unsatisfactory snow levelsof this past winter (particularly in Switzerland and France),focused marketing campaigns enabled us to generate a high
level of sales. In addition, the greater opportunities to createartificial snow in the Alpine regions had a stabilizing effect.
BEACHTECHKässbohrer Geländefahrzeug AG's second business area –BeachTech – reported a decrease in sales volume and sales forthe first time in the past fiscal year. The consolidated sales ofEUR 2.6 million are not satisfactory in light of the decline inmarket volume by over 20 %. The main reason for the drop wasthe collapse of the Spanish market, the largest single market forbeach cleaning equipment. Severe storms caused substantialdamage there in spring 2002. For this reason, investment budgets were spent on rehabilitating coastal and beach areas,and funds for grooming beaches and for purchasing vehicleswere only available on a very limited basis.
Because this decline in sales is attributable to the contraction inmarket volume, we were able to maintain our global leadershipposition in this business.
In summer 2002, we held an in-depth series of demonstrationsof the new BeachTech Marina on the coasts of Spain, France,and Italy. A key advantage of this extremely maneuverablevehicle is its multifunctionality. In addition to beach cleaning,the BeachTech Marina can be used for applications such as cleaning the tracks at horse racing facilities and stud farms. Theunusually high level of development expenses in the beach cleaning business in fiscal year 2001/2002 resulted in a loss forthe year in this division of € -0.4 million.
EARNINGS DEVELOPMENTUnless otherwise stated, the following information relates toboth the single-entity and the consolidated financial statements.
The Group's gross profit amounts to € 59.1 million, which corresponds to a margin of 46.4 % in relation to total operatingrevenue. The gross profit in the single-entity financial statements amounts to € 46.7 million and the margin to 42.5 %.The measures introduced with the aim of increasing grossprofit bore fruit for the first time in the past fiscal year, despite the higher cost of materials required for themanufacture of initial series and prototypes of newly developed products. Reducing the number of temporaryemployees in production had a positive effect on the gross profit margin.
Personnel expenses in the Group totaled € 25.6 million,while the single-entity financial statements disclose personnel expenses of € 21.2 million. The average numberof Group employees for the year rose from 412 to 426 in
Kässbohrer Geländefahrzeug AG, Laupheim.
Combined Management Report and Group Management Report for Fiscal Year 2001/2002
MARKET AND ENVIRONMENT
Kässbohrer Geländefahrzeug AG operates on the leisure andtourism market. The general environment in this industry has been influenced for the long term by the events ofSeptember 11, 2001, as well as by the downturn in the globaleconomy. Travel plans are affected by the availability offunds, people's expectations for the future and their outlookon personal safety and security. For these reasons, travelersmade significant changes in their vacation planning and thevacation destinations they chose last year.
The downswing in the tourism industry has had a dispro-portionately small impact on winter tourism, which isKässbohrer Geländefahrzeug AG's core business. Despitethis fact, uncertainties remain concerning future develop-ments. Tourist streams are shifting in the ski business due tothe decreased willingness of consumers to fly, changes inskiers' requirements in relation to ski and tourist areas, andswings in exchange rates. Moreover, ski vacations are beingplanned with less and less time in advance. Both of these fac-tors result in increased uncertainties in planning for ski areasand their operators with regard to their possible earnings inthe coming season. This in turn affects their willingness toinvest. Given their existing vehicle fleets, operators aresometimes reluctant to invest in slope maintenance vehicles,or they put off these investments into the future. As a result,the global volume of the slope maintenance vehicle marketshrank by over 10 % last year.
Nonetheless many ski areas reported very good bookings inthe winter of 2001/2002. Even the North American ski industry reported its third best year of all time after theevents of September 11. Ski regions around the world thatcan be quickly accessed from metropolitan areas by train orcar have benefited in particular.
The opportunities for Kässbohrer Geländefahrzeug AG in thewinter sports market continue to be good. The Company isrepresented in the new markets of Eastern Europe, CentralAsia and China by highly qualified partners. In addition,Kässbohrer Geländefahrzeug AG is optimally positioned inthe market with new models and updates to the PistenBully.The new PistenBully 300 Polar is clearly the premium product on the market. The stringent requirements of skiersand ski area operators are met with innovative solutions.Perfectly prepared slopes and optimally designed snowadventure playgrounds are easy and economical for driversto create with PistenBully vehicles and add-on equipment.
The additional development of the PistenBully Canyon and
the PistenBully 100 All Season in the year under review enabled the Company to develop new markets outside ofwinter sports. PistenBully vehicles can also be used as commercial vehicles by utilities and telecommunicationcompanies in seemingly impassable terrain or for mowingand mulching applications in addition to winter use.
A decline in summer tourism is clearly evident in many ofthe top vacation countries to date. A study on developmentsin the tourism industry by British American Tobacco's (BAT)Leisure and Research Institute states, "International crisesand terrorist attacks have been unable to change the travelbehavior of vacationers for the long term. However, temporary shifts in travel patterns (e.g. away from Egypt,Florida, or Turkey) were ascertainable. Consumers whointended to travel on vacation remained firm with their plans,even in times of crisis, although they sometimes changedtheir destination." The report also remarks, "…the currenteffects of the crisis and the economic recession on tourismare manageable and predictable _ to the extent that both ofthese factors do not escalate further." The tourism industrywill have to adapt to the temporary reluctance of consumersto travel. However, summer tourism is still considered a stable to growing market for the medium and long term. Theincreasing demand for high-quality beaches will also openup additional market opportunities for KässbohrerGeländefahrzeug AG. The new BeachTech Marina – a highly maneuverable, self-propelled vehicle – will enable theglobal market leader to develop new market and customersegments in the coming years.
Due to its dependence on the tourism industry, KässbohrerGeländefahrzeug AG is operating in a difficult market that iscurrently on the decline. However, if winter tourism bookings remain strong and the long-term growth trend insummer tourism holds, the potential of PistenBully andBeachTech vehicles will also continue to grow – andKässbohrer Geländefahrzeug AG will be ready and waiting.The Company has driven forward the expansion of its product range and launched more new vehicles in fiscal2001/2002 than ever before. This will enable Kässbohrer tostrengthen its market position in its core business and reduceits dependence on winter sports by developing new markets.
44
4746
The Group's liabilities were reduced as of September 30,2002 from € 48.2 million to € 40.9 million. The AG reportedliabilities of € 36.8 million (previous year: € 43.7 million).Liabilities to banks were repaid in the amount of €5.5 million –a reduction of 17 %. The lower amount of funds tied up ininventories and the cash flow realized in the fiscal year underreview enabled the Company to pay down these liabilities.
BRANCH OFFICES/GROUPThe subsidiaries in the USA and France and the branch officesin Austria, Switzerland and Italy are sales and service companies that exclusively sell and service the products ofKässbohrer Geländefahrzeug AG.
In fiscal year 2001/2002, all of the subsidiaries and branch offices contributed to Kässbohrer's excellent consolidated earnings by reporting net income for the year. Very satisfactorysales were generated in Italy and France in particular. The salessituation in the USA was overshadowed by the events ofSeptember 11, 2001. After that date, only very few investmentswere made.
In the USA, measures aimed at restructuring and expanding thedealer network were introduced. In addition, supplementarysales and service employees were hired.
In the past fiscal year, the decision was made to relocate theheadquarters of the French subsidiary from Le Fayet toAlbertville. The move is expected to be completed in 2003according to current plans. The new site will further improveservice quality since the distance to the major ski areas inFrance and to customers in the southern Alps will be reducedsubstantially.
DVFA/SG CASH FLOWDVFA/SG cash flow amounts to € 9.9 million. Based on theexcellent consolidated earnings, the higher level of depre-ciation and amortization and the addition of deferred taxexpenses in the amount of € 0.5 million were the main factors affecting the Company's cash flow. This enabled theCompany to finance all of its investments from cash floweven in a year that featured the relocation of its headquartersin Germany, a move that required especially high grossinvestments.
INVESTMENTSIn the year under review, the Group invested € 4.1 million in tan-gible assets; this item amounted to € 3.9 million in the single-entity financial statements. The investments related primarily to new operating equipment at the facility in
Laupheim, where state-of-the-art testing and measurementequipment was installed and measures for optimizing logisticsprocesses and production workflows were introduced.
DIVIDENDThe Managing Board and Supervisory Board are proposinga dividend of € 0.30 per share for fiscal year 2001/2002 tothe General Meeting. This corresponds to a dividend yield of2.5 %. The total amount to be paid out is € 1.5 million.
EMPLOYEESKässbohrer Geländefahrzeug AG has a reputation as anattractive employer in the region. The relocation of theCompany's headquarters from Senden/Ulm to Laupheim didnot have an effect on the employee turnover rate, which hasbeen extremely low for years. All employees moved with theCompany to the new site.
In fiscal year 2001/2002, a new group of young people begantheir commercial and industrial training at KässbohrerGeländefahrzeug AG. In addition, the Company also trainsqualified future managers in cooperation withBerufsakademien (universities of cooperative education). Anoutstanding level of expertise and systematic, ongoing training of employees are critical factors in the success of acompany. These goals are actively promoted by Kässbohrerthrough a human resources development program. A largenumber of employees participate regularly in the ongoingtraining courses that the Company offers.
MATERIALS MANAGEMENT AND LOGISTICSKässbohrer Geländefahrzeug AG took the opportunities thatarose from constructing a new factory and utilized them to the Company's benefit. Company workflows were over-hauled and restructured. The reorganization of the logisticsprocess resulted in an optimal flow of materials and moreefficient, and therefore cost-effective, processes at the newfacility in Laupheim.
The construction of the new factory also enabled Kässbohrerto systematically expand its quality assurance system. Each vehicle is subjected to rigorous testing before shipmentusing state-of-the-art test beds. The testing processes are automated and simulate terrain features and peak loads towhich the PistenBully is exposed while in use.
We systematically continued our close cooperation with oursuppliers. Their expertise is integrated into our developmentprocess at an early stage.
fiscal year 2001/2002 compared with the short fiscal year2001. In the single-entity financial statements, this numberincreased from 339 to 348. Extra human resources capacitywas added in Germany in the development and service departments. Compared with previous years, fewertemporary employees were utilized in vehicle assembly;instead, these positions were occupied by the Company's ownemployees. The US subsidiary further increased its serviceand sales capacity.
Depreciation and amortization charges amounted to € 2.6million in the Group and € 2.3 million in the single-entity financial statements as planned. In the short period,depreciation and amortization in the Group totaled €1.2 millionin six months. The higher level of depreciation and amortizationresulted from the investment of retained earnings in the newfacility in Laupheim in fiscal 2001/2002.
Other operating expenses amounted to € 21.7 million in theconsolidated and € 17.9 million in the single-entity financialstatements. In the six-month short fiscal year, the Group reported other operating expenses of € 10.8 million, while thisitem totaled € 8.9 million in the single-entity financial statements. Leasing expenses for the new facility in Laupheimwere incurred for the first time in the second half of the fiscalyear under review. The costs of the relocation in spring 2002resulted in non-recurring expenses of € 0.7 million. Comparedto the previous year, additional third-party development services were utilized for the development of the newBeachTech Marina and PistenBully 300 Polar vehicles.
In the past fiscal year, financial expenses totaled € 1.6 million in the Group and € 1.7 million in the AG. The slightdownturn in interest rates and the decreased utilization of operating lines of credit had a positive effect. The interest portion of the leasing payments for the new facility inLaupheim ( € 0.5 million) was reported under interest expenses.
The result from ordinary activities was € 9.3 million in theGroup and € 6.7 million in the AG. This is the second-best resultin the history of Kässbohrer Geländefahrzeug AG, following the extraordinarily strong sales year of 2000/2001. Inthe short fiscal year, a negative result from ordinary activities of € -7.3 million was reported due to seasonal influences as explained above.
Risks from external tax audits of the Company amounting to € 0.6 million were reported as part of the tax expenses item, whichtotaled € 2.9 million. The tax rate after adjustment for this effectbenefited from loss carryforwards at subsidiaries and branchoffices that arose from the result reported in the short fiscal year.
The Company's consolidated earnings of € 6.4 million alsorepresent the second-best result since the Company's formation via a spin-off in 1994, despite the tax-related special effects, the costs of the relocation and the especiallyintensive development activities of the past fiscal year.
BALANCE SHEET STRUCTURETotal assets amounted to € 89.4 million as of September 30,2002 (previous year: € 91.2 million) in the KässbohrerGeländefahrzeug Group and to € 83.9 million in the single-entity financial statements (previous year: € 86.6 million).
Fixed assets rose by around 12 % to € 11.7 million in theGroup. This increase was due in particular to the investment ofretained earnings in the new facility in Laupheim. No investments were made in real estate because the new factoryin Laupheim was constructed by a leasing company.
Current assets totaled € 74.4 million as of September 30,2002 in the consolidated financial statements, down significantly from the previous year's figure of € 77.6 million. Focused measures aimed at reducing inventories andencouraging sales of used vehicles had a positive effect here.Inventories in the Group were reduced by € 5.0 million to€54.6 million. The increase of around €1.7 million in Groupreceivables and other assets as of the reporting date resultedfrom vehicle shipments in September in particular. The single-entity financial statements of Kässbohrer Geländefahrzeug AGreported current assets in the amount of € 69.4 million (pre-vious year: € 74.2 million).
As of September 30, 2002, equity amounted to € 30.3 million in the Group (previous year: € 25.3 million) and to€ 31.2 million in the single-entity financial statements (previous year: 28.0 million). The Group's equity ratio hit 34 %after 28 % in the previous year. Due to pre-production ofvehicles and their shipment to customers usually no earlier thanNovember or December, the equity ratio is regularly at itslowest point of the year on September 30. At this time, totalassets are at their highest point due to the build-up of inventories. Moreover, the equity to be reported monthly declines regularly over the summer months. Recurring costscannot be offset by lower sales during these months in thisstrongly seasonal business.
At € 17.4 million, the Kässbohrer Geländefahrzeug Group'sprovisions are slightly higher than the previous year's level (€ 17.1 million). Provisions for taxes increased by € 0.4 milliondue to the risks from ongoing external tax audits in Germanyand abroad.
4948
Another key entrepreneurial risk is the development ofexchange rates, particularly with regard to the US dollar.Exchange rate trends are monitored constantly by theManaging Board, and the associated risks are limited in linewith the rate hedging policy agreed with the SupervisoryBoard, using forward exchange contracts in particular. The Company's success in a service-intensive business is largely dependent on customer satisfaction. For this reason,customers are surveyed regularly by sales and serviceemployees and asked for their suggestions. These statementsare compiled systematically and make up an essential component of the discussions on the further development ofKässbohrer's products and services.On the whole, the management is of the opinion that thereare no discernible developments, with the exception of thedownturn in market volume for the PistenBully, that couldhave a long-term effect on the financial position and resultsof operations of the Group or that could endanger the continued existence of the Company. The decrease inPistenBully market volume will lead to lower sales and earn-ings in fiscal year 2002/2003 than in the previous year. TheCompany has introduced the appropriate countermeasures.
RELOCATION TO LAUPHEIMKässbohrer Geländefahrzeug AG relocated its headquartersto Laupheim in April 2002. The former facilities at Ulm andSenden were closed. All of the Company's operations inGermany are now combined at a single site. The move wascompleted on time and without incident. Compared to its twoformer sites, Kässbohrer has been able to cut costs thanks tonewly designed processes. The total investment volume for themove amounted to around € 24.5 million, the majority ofwhich was financed via a real estate leasing agreement.
DEPENDENT COMPANY REPORTThe Managing Board of Kässbohrer Geländefahrzeug AGprepared a report on relationships with affiliated companiesin accordance with section 312 of the AktG and in this reportissued the following concluding statement: "With regard tothe legal transactions and measures listed in the report onrelationships with affiliated companies, KässbohrerGeländefahrzeug AG received appropriate compensation forevery legal transaction, and has not been placed at a disadvantage due to measures that were implemented or notimplemented, according to the circumstances that wereknown to us at the time the legal transactions were concludedor the measures were implemented or not implemented."
CURRENT BUSINESS DEVELOPMENT AND OUTLOOKKässbohrer Geländefahrzeug AG operates within the leisure andtourism industry in a market that is considered to be a growth
market for the medium to long term. According to professionalopinion, this market is in a temporary downturn and is experiencing structural changes, but in the medium term isexpected to see renewed growth. The tourism industry will create the demand necessary for further growth by diversifyingits offering in the future. The year 2002 was indisputably a disappointing one for the tourism industry. The outlook for 2003 is hardly better under thecurrent circumstances, because the economic uncertainties inEurope and North America are simply too great. This situation isalso influencing the willingness of customers to invest. Manycompanies that operate ski areas are taking a wait-and-seeapproach. At this time, the market volume in the 2002/2003 season is anticipated to be around 15 % below that of the previous year. Because of Kässbohrer Geländefahrzeug AG'slarge global market share, this trend will also affect theCompany's sales activities in fiscal year 2002/2003. Taking intoaccount the expected lower volume of new vehicle sales and thecurrently weaker US dollar, we must therefore assume that consolidated earnings in fiscal year 2002/2003 will also fallbelow the figure reported in 2001/2002. In the medium term,however, we anticipate the market to stabilize again and growslightly. Kässbohrer Geländefahrzeug AG is well prepared for this situation thanks to its newly developed vehicles. The Companyhas clearly reinforced its position as the global market leader inthe core slope and trail maintenance business by developing thenew PistenBully 300 Polar and the new, high-performancewinch. Moreover, the new PistenBully All Season, PistenBullyCanyon and PistenBully Fireflex products will enable Kässbohrerto develop new markets that are expected to generate significantsales in the reasonably near future.
By establishing positive conditions for business in the new factory and expending enormous effort on updating existing anddeveloping new products, the Company has created an excellentfoundation for medium-term growth.
Kässbohrer Geländefahrzeug AG, Laupheim, November 2002
The Managing Board
Dr. Hendrik Grobler, Rolf Glessing
RESEARCH AND DEVELOPMENTNever before has Kässbohrer Geländefahrzeug AG launchedso many new developments within a single fiscal year.Research and development expenses increased to € 5.0 million (3.8 % of consolidated sales) for this reason.
The result of these intensive development activities is a newcrop of vehicles for slope and beach maintenance, as well asvehicles for extreme off-road applications:
Slope maintenance vehicles:• The PistenBully 300 Polar – a premium vehicle operating at
430 horsepower: the world's first slope maintenance vehiclewith an intelligent, adaptive tiller control, the SNOWtronic.
• The new winch for the PistenBully 300 W and PistenBully300 Polar. In addition to 30 % more tractive power, thiswinch features electronic rope failure detection (RFD) andlonger service intervals, what is more, the maximum cablework speed was increased by 30 %.
• Kässbohrer Geländefahrzeug AG has already implementedthe European standards on rollover protective structures(ROPS), which will become law as of 2004, in the entirePistenBully vehicle series.
• The PistenBully All Season is an all-season vehicle that canbe used for applications such as street cleaning or mowingafter the winter season is over.
Beach cleaning vehicles:• BeachTech Marina is the first self-propelled beach
cleaning vehicle built by Kässbohrer GeländefahrzeugAG. The vehicle is extremely maneuverable and is alsosuitable for cleaning small beaches. Moreover, it can beused to clean equestrian tracks or, with the help of add-on equipment, to mow lawns or sweep streets.
Off-road vehicles:• PistenBully Canyon is an all terrain tracked vehicle suited for
any type of off-road work, transportation or service applica-tion – wherever wheeled all-terrain vehicles cannot cope.
• PistenBully Fireflex: a PistenBully Flexmobil featuringrubber tracks and fire-fighting equipment. This versatileand extremely capable slope-climber was developed forfire-fighting and disaster relief applications.
• All-season MultiGrip tracks were designed for all-arounduse in snow, slush, gravel, mud, grass, and asphalt and areavailable for the smaller PistenBully models.
The expansion of the product range will strengthenKässbohrer Geländefahrzeug AG's leadership position on themarket, and substantially increase its ability to move intoother significant business activities outside of winter sports.
RISK REPORTThe focus of Kässbohrer Geländefahrzeug AG's businessactivities is on the winter sports business and its global presence in a small niche market. The Company takes advantage of its market opportunities in this area. Againstthis backdrop, however, the Company is also faced with certain risks that normally confront companies engaging inglobal business activities. Entrepreneurial risks are always eval-uated in connection with the associated opportunities and areonly taken if they serve to further the Company's development.
In compliance with the statutory regulations, KässbohrerGeländefahrzeug AG has combined the early warningsystems existing in the Group into a risk managementsystem. The communications culture of the Company is designed so that management is informed early and regularlyusing short, direct communication channels about develop-ments that could threaten the Company's existence or have amaterial adverse effect on its financial position and results ofoperations. This enables the Managing Board to identify,analyze and assess the development of material risks andnew sources of risk early on and then to introduce the appropriate countermeasures.
Vital tools in the risk management system include the management information system, risk workshops, group-wide management meetings, regular monitoring of relevantglobal markets and specific market knowledge that is basedon close, long-term relationships with customers, suppliers,and market representatives.
One key aspect of Kässbohrer Geländefahrzeug AG's riskprofile is the development of the market as defined by thecompetitive situation and the global economic environment.Moreover, the Company's core PistenBully business is shaped by developments in winter tourism and ski sports.These trends are in turn dependent on external factors suchas the amount and timing of snowfall. By expanding its product range and developing new markets for its newlydesigned vehicles, the Company is, of course, taking on additional risks. On the other hand, these efforts expand theCompany's business activities, thereby reducing the risks thatarise from Kässbohrer's dependence on the winter sportsbusiness.
Another core risk to which the Company is exposed is thedependence on individual suppliers for certain technologies.This can lead to limited availability of individual, butnonetheless vital, vehicle components. For this reason,Kässbohrer always seeks alternative solutions and evaluatesthe extent to which they can be implemented.
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Equity and liabilities Notes Sept. 30, 2002 Sept. 30, 2001
€ thousand € thousand
Equity (7)
Subscribed capital 13,006 13,000
(Contingent capital: EUR 1,034 thousand;
previous year: EUR 1,040 thousand)
Capital reserves 7,471 7,452
Revenue reserves
Other revenue reserves 4,692 2,454
Net retained profits 6,009 5,071
31,178 27,977
Special tax-allowable reserves 0 15
Provisions
Provisions for pensions and similar obligations 2,129 1,954
Other provisions (8) 13,645 12,851
15,774 14,805
Liabilities (9)
Loans 285 302
Liabilities to banks 26,339 31,862
Payments received on account of orders 536 672
Trade payables 7,472 8,677
Liabilities to affiliated companies 0 65
Other liabilities 2,207 2,153
36,839 43,731
Deferred income 154 114
83,945 86,642
Assets Notes Sept. 30, 2002 Sept. 30, 2001
€ thousand € thousand
Fixed assets
Intangible assets (1) 5,446 6,181
Tangible assets (2) 4,879 2,498
Financial assets (3) 3,543 3,535
13,868 12,214
Current assets
Inventories (4) 35,596 37,697
Receivables and other assets (5) 32,661 35,682
Cash-in-hand, bank balances 1,094 824
69,351 74,203
Prepaid expenses (6) 726 225
83,945 86,642
Kässbohrer Geländefahrzeug AG, Laupheim.
Balance Sheet as of September 30, 2002
Assets Notes Sept. 30, 2002 Sept. 30, 2001
€ thousand € thousand
Fixed assets
Intangible assets (1) 5,981 6,787
Tangible assets (2) 5,453 3,450
Financial assets (3) 247 240
11,681 10,477
Current assets
Inventories (4) 54,579 59,557
Receivables and other assets (5) 16,648 15,685
Cash-in-hand, bank balances 3,140 2,389
74,367 77,631
Prepaid expenses (6) 3,346 3,077
89,394 91,185
Kässbohrer Geländefahrzeug AG, Laupheim.
Consolidated Balance Sheet as of September 30, 2002
Equity and liabilities Notes Sept. 30, 2002 Sept. 30, 2001
€ thousand € thousand
Equity (7)
Subscribed capital 13,006 13,000
(Contingent capital: EUR 1,034 thousand;
previous year: EUR 1,040 thousand)
Capital reserves 7,471 7,452
Revenue reserves
Legal reserve 39 39
Other revenue reserves 4,692 2,454
Net retained profits 5,067 2,155
Adjustment for minority interests 13 9
Adjustment for currency translation 14 200
30,302 25,309
Special tax-allowable reserves 0 15
Provisions
Provisions for pensions and similar obligations 2,129 1,954
Other provisions (8) 15,279 15,111
17,408 17,065
Liabilities (9)
Loans 285 302
Liabilities to banks 26,339 31,862
Payments received on account of orders 1,027 1,832
Trade payables 9,151 10,651
Liabilities on bills accepted and drawn 46 98
Other liabilities 4,031 3,430
40,879 48,175
Deferred income 805 621
89,394 91,185
5352
Notes 2001/2002 Short fiscal year 2001
€ thousand € thousand
Sales (10) 112,994 42,141
Decrease (previous year: increase) in
finished goods and work in progress -2,937 9,275
Total revenue 110,057 51,416
Other operating income (11) 3,155 1,478
Cost of materials (12) -63,421 -34,521
Personnel expenses (13) -21,217 -9,590
Amortization of intangible assets
and depreciation of tangible assets -2,346 -1,033
Other operating expenses (14) -17,861 -8,881
Financial result (15) -1,701 -498
Result from ordinary activities 6,666 -1,629
Taxes on income (16) -1,716 1,648
Other taxes (17) -474 -2
Net income for the year 4,476 17
Notes 2001/2002 Short fiscal year 2001
€ thousand € thousand
Sales (10) 132,180 30,398
Decrease (previous year: increase)
in finished goods and work in progress -4,871 19,429
Total revenue 127,309 49,827
Other operating income (11) 1,746 702
Cost of materials (12) -68,186 -33,749
Personnel expenses (13) -25,584 -11,684
Amortization of intangible assets
and depreciation of tangible assets -2,639 -1,160
Other operating expenses (14) -21,677 -10,762
Financial result (15) -1,661 -440
Result from ordinary activities 9,308 -7,266
Taxes on income (16) -2,305 3,208
Other taxes (17) -591 -67
Consolidated net income/loss for
the year before minority interests 6,412 -4,125
Minority interests -3 3
Consolidated net income/loss for the year 6,409 -4,122
Kässbohrer Geländefahrzeug AG, Laupheim.
Income Statement for the Fiscal Year from October 1, 2001 to September 30, 2002
Kässbohrer Geländefahrzeug AG, Laupheim.
Consolidated Income Statement for the Fiscal Year from October 1, 2001 to September 30, 2002
5554
The notes to the single-entity and consolidated financial statements are presented in combined form below. Unless stated otherwise, the explanations apply to both sets of financial statements. Various items of the balance sheet and income statement havebeen combined to enhance the clarity of presentation in thesingle-entity and consolidated financial statements. Suchitems are disclosed separately in the combined notes to thesingle-entity and consolidated financial statements.
Unless stated otherwise, all figures are given in thousands ofeuros.
EQUITY INTERESTS/COMPANIES INCLUDED IN CONSOLIDATIONIn addition to Kässbohrer Geländefahrzeug AG, Laupheim(hereinafter also referred to as KGF AG) as the parent company and its three foreign branch offices, the Companyholds equity interests in two subsidiaries:
Branch offices/ Interest held Equity as of Sept. 30, 2002 Net income in fiscal year 2001/2002
subsidiaries in % Currency Amount Currency Amount
Kässbohrer Geländefahrzeug AG,
Austrian branch office,
Kuchl (hereinafter also referred
to as KGF AG-Kuchl) – T € – T € 1,149
Kässbohrer Geländefahrzeug AG,
Swiss branch office, Möriken
(hereinafter also referred to as
KGF AG-Möriken) – T SFR – T SFR 711
Kässbohrer Geländefahrzeug AG,
Italian branch office, Bolzano
(hereinafter also referred to as
KGF AG-Bolzano) – T € – T € 538
Socedam S.A., Le Fayet,
France (hereinafter also
referred to as Socedam) 99.4 T € 2,121 T € 530
Kässbohrer All Terrain Vehicles, Inc.,
Reno (Nevada), USA (hereinafter also
referred to as KATV) 100 T $ 2,476 T $ 576
Bra
nch
offi
ces
Subs
idia
ries
ACCOUNTING AND VALUATION POLICIESThe annual financial statements of Kässbohrer Gelän-defahrzeug AG, Laupheim, and the annual financial statements of the subsidiaries are generally prepared using uniform accounting policies. Intangible assets are carried at
their cost of acquisition, less straight-line amortization basedon a standard useful life of three to fifteen years.
The goodwill capitalized on the basis of the allocation ofpurchase prices in the individual financial statements of theGroup companies is amortized over a period of five to fifteenyears. Capitalized trademark and patent rights are amortizedover four years.
Tangible assets are valued at their cost of acquisition ormanufacture, less regular depreciation. Depreciation is calculated in accordance with the rates permitted by tax law;both the straight-line and the declining-balance methods ofdepreciation were used. The switch is made from using thedeclining-balance to using the straight-line method when thestraight-line method results in higher depreciation amounts.Regular depreciation is calculated on the basis of the maximum depreciation rates permitted by tax law, with usefullives of between five and 18.5 years.
Depreciation is charged for the full year for movable assetsacquired in the first six months of the year and for half of thefull year's amount for assets acquired in the second sixmonths. Low-value assets are written down in full in the year of acqui-
Kässbohrer Geländefahrzeug AG, Laupheim.
Combined Notes to the Single-Entity and ConsolidatedFinancial Statements for Fiscal Year 2001/2002
56
CONSOLIDATED CASH FLOW STATEMENT NOTES TO THE BALANCE SHEETChanges in the fixed assets of KGF AG and of the Group infiscal year 2001/2002 are disclosed in detail in the statementof changes in fixed assets.
(1) Intangible assetsThese relate in particular to goodwill resulting from theacquisition of the all-terrain vehicles division of Evo BusGmbH, Ulm (formerly: Karl Kässbohrer FahrzeugwerkeGmbH).
(2) Tangible assetsThese relate principally to the technical equipment andmachinery, as well as other equipment, and operating andoffice equipment at KGF AG's headquarters in Laupheim.The increase in tangible assets resulted primarily from theinvestment of retained earnings in vehicle and caterpillartrack production and in warehouse facilities at the new headquarters of the Company in Laupheim.
(3) Financial assetsLoans to affiliates disclosed in the single-entity financial statements consist of a loan to the French subsidiary.
2001/2002 Short FY 2001
€ thousand € thousand
Consolidated net income/loss for
the year after minority interests 6,409 -4,122
Depreciation/amortization
of fixed assets 1,842 733
Step-up depreciation/amortization
of fixed assets 801 438
Increase in provisions for pensions 175 122
Increase in other long-term provisions 151 373
Decrease in the special tax-allowable reserve -15 -6
Deferred tax income/expenses 547 -1,620
DVFA/SG cash flow 9,910 -4,082
Increase/decrease in inventories 4,978 -25,612
Increase/decrease in trade receivables
and other current assets -1,780 9,336
Increase/decrease in
short-term provisions 17 -3,030
Increase/decrease in trade payables
and other liabilities -1,588 4,393
Net cash provided by/used in
operating activities 11,537 -18,995
Disposal of fixed assets 277 389
Investments in intangible assets -141 -109
Investments in tangible assets -4,066 -1,189
Investments in financial assets -12 -7
Net cash used in investing activities -3,942 -916
Contributions from loans raised 0 21,544
Contributions from capital increase 25 0
Dividend -1,300 -2,045
Payments for loan redemption -5,522 0
Net cash provided by/used in
financing activities -6,797 19,499
798 -412
Change in net funds
Change in minority interests/
currency translation effects -47 -72
Funds at the beginning of the fiscal year 2,389 2,873
Funds at the end of the fiscal year 3,140 2,389
sition and reported under additions and disposals in the statementof changes in fixed assets in the year of acquisition.
Financial assets are carried at their cost of acquisition or thelower value to be applied at the balance sheet date in the case ofpermanent impairment of value.
Raw materials, consumables and supplies are valued at acquisition cost, plus incidental costs of acquisition, on a strictlower-of-cost-or-market basis. The acquisition cost is determinedusing the moving average cost method. In certain insignificantcases, fixed amounts are used. Adequate write-downs have beenapplied for discernible risks due to prolonged storage, overstocking, or reduced technical marketability.
Unlike the previous year, inventories of spare parts were includedin the "Raw materials, consumables and supplies" item for thefirst time as of September 30, 2002 (previous year: "Finishedgoods and merchandise").
Work in progress and finished goods are carried at the cost ofmanufacture, which includes adequate material and productionoverheads in addition to direct material and production costs, inaccordance with tax valuation rules. Adequate write-downs havebeen applied for discernible risks due to prolonged storage, overstocking, or reduced technical marketability.
Merchandise and used vehicles are carried at the cost of acqui-sition, or at the probable lower selling proceeds after takingaccount of any costs still to be incurred.
Receivables and other assets are carried at their principal amount. Default risks are covered by specific write-downs, and aglobal write-down has been charged for the general credit risk.
Provisions for pensions in Germany are calculated in accord-ance with actuarial principles as per section 6a of theEinkommensteuergesetz (EStG – German Income Tax Act) andbased on an assumed rate of interest of 6 % per year. The 1998Heubeck mortality tables were used to calculate the amount ofthe provisions.
Provisions for taxes and other provisions are set up on thebasis of prudent commercial practice and cover all risks anduncertain obligations discernible at the balance sheet date aswell as up to the time that the balance sheet was drawn up.
Liabilities are carried at their redemption amount.
CONSOLIDATION PRINCIPLESCapital consolidation was performed using the book valuemethod by eliminating acquisition costs against the proportionalequity of the subsidiaries at the time the interests were acquired.
For the initial inclusion of Socedam, this produced a difference of€ 256 thousand on the asset side, which was disclosed as goodwilland amortized in full in previous years.
Intercompany profits which arose in inventories as a result ofintragroup deliveries and services are eliminated and recognizedin income.
Receivables and liabilities between consolidated companies areeliminated, with any differences from the consolidation of intercompany balances being recognized in income.
Revenues from intercompany sales and intragroup income are eliminated against the corresponding expenses. Deferred taxes are set up on consolidation measures at a tax rateof 40 % (previous year: 40 %). The choice was made not to capitalize deferred taxes in the single-entity financial statements.
CURRENCY TRANSLATIONIn the single-entity financial statements of the Group companies, foreign currency receivables are translated at the bidrate and foreign currency liabilities at the offered rate prevailingat the time they arose. Losses due to rate changes which occurred up to the balance sheet date are recognized. Foreign currency bank balances and cash are translated at the bid rate at the balance sheet date, liabilities to banks at the offered rate.
In the single-entity and consolidated financial statements, thebalance sheet items of the foreign branches and subsidiaries aretranslated at the middle rate on the balance sheet date. The equity of foreign subsidiaries is translated at historical rates. Theresulting differences are not recognized in income and are disclosed separately under equity as adjustments to foreign currency translation.
The items of the income statements of foreign subsidiaries andbranch offices are translated at the average rates for the fiscalyear. Results for the year are translated at the closing rates. Anyresulting differences are disclosed under "Other operatingexpenses" or "Other operating income".
57
5958
Acquisition or manufacturing cost Depreciation and amortization expense Net book values
Oct. 1, 2001 Additions Disposals Transfers Sept. 30, 2002 Oct. 1, 2001 Additions Disposals Sept. 30, 2002 Sept. 30, 2002 Sept. 30, 2001
€ thousand1)
€ thousand € thousand € thousand €thousand € thousand 1)
€ thousand € thousand € thousand € thousand € thousand
Intangible assets
Concessions, industrial and similar rights and
assets and licenses in such rights and assets 18,722 141 0 0 18,863 18,463 123 0 18,586 277 259
Goodwill 12,828 0 0 0 12,828 6,906 753 0 7,659 5,169 5,922
31,550 141 0 0 31,691 25,369 876 0 26,245 5,446 6,181
Tangible assets
Land, land rights and buildings including
buildings on third-party land 1,139 230 -544 0 825 944 188 -539 593 232 195
Technical equipment and machinery 3,596 1,243 -81 134 4,892 2,717 467 -74 3,110 1,782 878
Other equipment, operating and office equipment 6,232 2,216 -1,582 312 7,178 5,251 815 -1,575 4,491 2,687 979
Payments on account and assets under construction 446 178 0 -446 178 0 0 0 0 178 446
11,413 3,867 -2,207 0 13,073 8,912 1,470 -2,188 8,194 4,879 2,498
Financial assets
Shares in affiliates 3,067 0 0 0 3,067 0 0 0 0 3,067 3,067
Loans to affiliates 229 0 0 0 229 0 0 0 0 229 229
Long-term investments 276 12 0 0 288 37 4 0 41 247 239
3,572 12 0 0 3,584 37 4 0 41 3,543 3,535
46,535 4,020 -2,207 0 48,348 34,318 2,350 -2,188 34,480 13,868 12,214
Acquisition or manufacturing cost Depreciation and amortization expense Net book values
Oct. 1, 2001 Additions Disposals Transfers Sept. 30, 2002 Oct. 1, 2001 Additions Disposals Sept. 30, 2002 Sept. 30, 2002 Sept. 30, 2001
€ thousand1)
€ thousand € thousand € thousand € thousand € thousand 1)
€ thousand € thousand € thousand € thousand € thousand
Intangible assets
Concessions, industrial and similar rights
and assets and licenses in such rights and assets 18,947 141 0 0 19,088 18,463 123 0 18,586 502 484
Goodwill 13,499 0 0 0 13,499 7,219 801 0 8,020 5,479 6,303
32,446 141 0 0 32,587 25,682 924 0 26,606 5,981 6,787
Tangible assets
Land, land rights and buildings including
buildings on third-party land 1,599 262 -554 0 1,307 1,247 266 -549 964 343 360
Technical equipment and machinery 3,976 1,266 -121 134 5,255 2,876 514 -112 3,278 1,977 1,112
Other equipment, operating and office equipment 7,884 2,330 -2,226 315 8,303 6,406 935 -1,963 5,378 2,925 1,529
Payments on account and assets under construction 449 208 0 -449 208 0 0 0 0 208 449
13,908 4,066 -2,901 0 15,073 10,529 1,715 -2,624 9,620 5,453 3,450
Financial assets
Long-term investments 276 12 0 0 288 37 4 0 41 247 240
46,630 4,219 -2,901 0 47,948 36,248 2,643 -2,624 36,267 11,681 10,477
STATEMENT OF CHANGES IN FIXED ASSETS OF KÄSSBOHRER GELÄNDEFAHRZEUG AG FOR FISCAL YEAR 2001/2002
STATEMENT OF CHANGES IN FIXED ASSETS OF THE GROUP FOR FISCAL YEAR 2001/2002
(1): The currency translation difference is € 24 thousand for acquisition and manufacturing costs, and € 21 thousand in the case of depreciation/amortization. The total currency translation effect on thenet book values therefore amounts to € 3 thousand.
(1): The currency translation difference is € 168 thousand for acquisition and manufacturing costs, and € 73 thousand in the case of depreciation/amortization. The total currency translation effect on thenet book values therefore amounts to € 95 thousand.
6160
(4) Inventories
As the result of consolidation at the Laupheim site of the series and spare part warehouses formerly operated separately at the Ulm and Senden sites, inventories of spareparts are reported under the "Raw materials, consumablesand supplies" item for the first time as of the balance sheet date. These inventories were formerly disclosed under "Finished goods and merchandise". For purposes of uniformity, the inventories of spare parts at branch officesand subsidiaries were also reclassified accordingly. The comparable value of raw materials, consumables and supplies including inventories of spare parts amounted to € 12,669 thousand in the AG and to € 5,878 thousand in theGroup as of September 30, 2001.
(5) Receivables and other assets
(6) Prepaid expenses and deferred incomeConsolidated prepaid expenses and deferred income relate primarily to deferred leasing fees at Socedam. As of September30, 2002, they also included deferred tax assets resulting fromconsolidation measures amounting to € 1,630 thousand (pre-vious year: € 2,177 thousand).
(7) EquityThe General Meeting on August 11, 2000 resolved to convertthe share capital from DM to euros. In this context, a capitalincrease from retained earnings was resolved by converting
€ 218 thousand of the capital reserves disclosed in the balancesheet. Following the implementation of this capital increase, theshare capital amounted to € 13,000 thousand as of the balancesheet date of the previous year and was composed of 5,000,000no-par value bearer shares with a nominal value of €2.60 each.Each share entitles the bearer to one vote.
In fiscal year 2001/2002, 2,400 no-par value shares were converted from convertible bonds issued. This increased the share capital of the Company to € 13,006 thousand, composed of 5,002,400 no-par value bearer shares as of the balance sheet date.
As the result of the exercise of subscription rights arising fromthe convertible bond in fiscal year 2001/2002, the capital reserves increased to € 7,471 thousand as of the balance sheetdate.
In the Extraordinary General Meeting on August 21, 1998,KGF AG's Managing Board was authorized, with the approvalof the Supervisory Board, to increase the share capital by up toDM 5,113 thousand until August 20, 2003 by issuing new no-par value bearer shares against cash contributions on one orseveral occasions ("authorized capital I") and, in addition, toincrease the share capital, with the approval of the SupervisoryBoard, by up to € 1,278 thousand until August 20, 2003 by issuing new no-par value bearer shares against cash and/or non-cash contributions on one or several occasions("authorized capital II").
Moreover, the Managing Board was authorized to implementcontingent capital increases. In accordance with section 218 of the AktG, the contingent capital was increased in the sameratio as the share capital as part of the capital increase fromretained earnings and amounted to € 1,040 thousand at the previous year's balance sheet date. In fiscal year 2001/2002,the contingent capital was reduced by € 6 thousand as a result of the conversion. At the balance sheet date, the contingent capital therefore amounts to € 1,034 thousand, € 52 thousand of which serves to grant subscription rights tothe employees of KGF AG and Socedam, and € 982 thousand of which is allocated for the issue of convertiblebonds.
Changes in consolidated equitya) Year under review
Net retained profits of € 6,009 thousand are available for distribution from consolidated equity raised according to thesingle-entity financial statements of Kässbohrer Gelände-fahrzeug AG.
b) Previous year
Net retained profits of € 5,071 thousand are available for dis-tribution from consolidated equity raised according to thesingle-entity financial statements of Kässbohrer Gelände-fahrzeug AG.
The net retained profits were derived from the net income for theyear as shown in the following:
1): The cumulative other consolidated net income consistsolely of the adjustment for currency translation.
1): The cumulative other consolidated net income consistsolely of the adjustment for currency translation.
(8) Other provisions
Other provisions primarily comprise provisions for warrantycommitments, outstanding vacation and overtime hours, bonuspayments, outstanding invoices, partial retirement obligations,potential losses and expenses associated with anniversary payments.
AG Group
Sept. 30, 2002 Sept. 30, 2001 Sept. 30, 2002 Sept. 30, 2001
€ thousand € thousand € thousand € thousand
Raw materials,
consumables
and supplies 14,222 4,784 17,689 4,792
Work in progress 2,575 2,689 2,609 2,750
Finished goods
and merchandise 18,799 30,224 34,281 52,015
35,596 37,697 54,579 59,557
AG Group
Sept. 30, 2002 Sept. 30, 2001 Sept. 30, 2002 Sept. 30, 2001
€ thousand € thousand € thousand € thousand
Trade receivables 9,779 7,410 14,121 13,461
– thereof due after
more than one year (144) (291) (144) (300)
Receivables
from affiliates 21,087 26,653 0 0
Other assets 1,795 1,619 2,527 2,224
– thereof due after
more than one year (203) (89) (681) (228)
32,661 35,682 16,648 15,685
Parent company
Subscribed Capital Consolidated Adjustment Equity Minority Group thereof total
capital reserves equity raised for currency capital equity consolidated
translation (1) earnings
€ thousand € thousand € thousand € thousand € thousand € thousand € thousand € thousand
As of April 1, 2001 13,000 7,452 10,815 322 31,589 12 31,601 0
Dividend payment 0 0 -2,045 0 -2,045 0 -2,045 0
Consolidated net loss
for the year 0 0 -4,122 0 -4,122 -3 -4,125 -4,122
Other changes 0 0 0 -122 -122 0 -122 -122
As of September 30, 2001 13,000 7,452 4,648 200 25,300 9 25,309 -4,244
AG Group
Sept. 30, 2002 Sept. 30, 2001 Sept. 30, 2002 Sept. 30, 2001
€ thousand € thousand € thousand € thousand
Provisions for taxes 2,559 2,041 2,585 2,152
Other provisions 11,086 10,810 12,694 12,959
13,645 12,851 15,279 15,111
AG Group
Sept. 30, 2002 Sept. 30, 2001 Sept. 30, 2002 Sept. 30, 2001
€ thousand € thousand € thousand € thousand
Net income
for the year 4,476 17 6,409 -4,122
Retained profits
brought forward 3,771 5,054 896 6,316
Allocation to the
legal reserve 0 0 0 -39
Other revenue reserves -2,238 0 -2,238 0
Net retained profits 6,009 5,071 5,067 2,155
Parent company
Subscribed Capital Consolidated Adjustment Equity Minority Group thereof total
capital reserves equity raised for currency capital equity consolidated
translation (1) earnings
€ thousand € thousand € thousand € thousand € thousand € thousand € thousand € thousand
As of October 1, 2001 13,000 7,452 4,648 200 25,300 9 25,309 0
Issue of shares 6 19 0 0 25 0 25 0
Dividend payment 0 0 -1,300 0 -1,300 0 -1,300 0
Other changes 0 0 41 -186 -145 1 -144 -186
Consolidated net income
for the year 0 0 6,409 0 6,409 3 6,412 6,409
As of September 30, 2002 13,006 7,471 9,798 14 30,289 13 30,302 6,223
lier than two years following the issue; up to 40 % no earlierthan three years following the issue; up to 60 % no earlierthan four years following the issue, up to 80 % no earlier than five years following the issue and up to 100 % no ear-lier than six years following the issue.
Moreover, the conversion right may only be exercised if theclosing price of the Company's ordinary shares on theFrankfurt Stock Exchange on the last trading day before theconversion date, adjusted for any capital measures performedby the Company in the meantime, amounts to
• at least 130 % of the placement price for which the shareswere offered to investors during the IPO – in the case ofconvertible bonds issued before the 1998 IPO, or
• at least 130% of the average market price of theCompany's shares on the last ten trading days precedingthe issue of the convertible bonds – in the case of con-vertible bonds issued at a later date.
Irrespective of these conditions, the conversion right mayalso be exercised if the Company's share price performs atleast 10 % better than the DAX mid-cap index (MDAX) inthe period between
• the time trading began in the offered shares in the case ofconvertible bonds issued prior to the 1998 IPO, or
• the day on which the convertible bonds are issued in thecase of convertible bonds issued at a later date – as theaverage rate during the last ten trading days prior beforethe issue,
and the last trading day before the conversion date.
2): A collateral pool agreement was concluded with the participating banks on October 30/November 4/November16, 1998 in order to secure the loan. The agreement wasinitially valid until July 31, 2002. This collateral pool agreement was terminated when the loan term was extended.The collateral covered by the agreement had been releasedby the lenders as of the balance sheet date.
The Company took advantage of an innovation promotionprogram set up by Kreditanstalt für Wiederaufbau(Germany's development bank) in order to complete variousdevelopment projects. To secure the loan volume of € 1,600thousand granted, tangible assets have been assigned and thepatents resulting from the development projects ceded to thelender.
A corporate finance loan in the amount of € 4,000 thousand was raised from Ausfuhrkreditanstalt (the Germanexport finance bank) as a lower-interest alternative to theCompany's previous medium-term financing. The collateralfor the loan consists of assignment of the parent company'sreceivables from the subsidiary in the USA.
NOTES TO THE INCOME STATEMENTDue to the short fiscal year from April 1 to September 30,2001 and the strongly seasonal nature of the Company'sbusiness, the figures for the prior period are only comparableto those of the current period to a limited degree.
(10) SalesPlease refer to our statements on segment reporting.
(11) Other operating incomeOther operating income in the single-entity financial statements consists primarily of license fee income from subsidiaries, supplier refunds, currency gains and on-charged management fees.
License fee income and management fees were eliminated atGroup level as part of the consolidation of expenses andincome.
63
(9) Liabilities
1): In two Extraordinary General Meetings on August 21,1998 and September 14, 1998, the Managing Board was authorized, with the approval of the Supervisory Board, toissue interest-bearing convertible bearer bonds with a maturity of up to seven years on one or several occasionsuntil August 20, 2003, and to grant the bearers of the convertible bonds conversion rights on up to 380,000 no-parvalue shares. After the conversion of the share capital fromDM to euros as resolved in the General Meeting on August11, 2000, convertible bonds with a total nominal value of € 988 thousand can be issued.
In this regard, a convertible bond with a total nominal valueof DM 358 thousand was issued by Kässbohrer Gelände-
fahrzeug AG, Laupheim, on September 7, 1998. Since then,a total of € 149 thousand has been repaid and € 82 thousandnewly issued. Subscription rights to 2,400 no-par value shares were exercised in relation to the conversion of € 6thousand of the convertible bond.
Under the terms of the bond issue, bondholders are entitledto convert their convertible bonds into KässbohrerGeländefahrzeug AG shares in full or in part. The bearer isentitled to convert each convertible bond with a nominalvalue of € 51.13 into 20 no-par value bearer shares ofKässbohrer Geländefahrzeug AG.
Up to 20 % of the conversion right may be exercised no ear-
62
AG thereof due in AG thereof
Sept. 30, 2002 up to more than Sept. 30, 2001 due in
Total one year five years Total up to one year
€ thousand € thousand € thousand € thousand € thousand
Bonds 1) 285 0 0 302 0
– thereof convertible: € 285 thousand
(previous year: € 302 thousand)
Liabilities to banks 2) 26,339 11,739 0 31,862 19,334
Payments received on
account of orders 536 536 0 672 672
Trade payables 7,472 7,472 0 8,677 8,678
Liabilities to affiliated companies 0 0 0 65 65
Other liabilities 2,207 2,207 0 2,153 2,065
– thereof taxes 607 607 0 444 444
– thereof social security 471 471 0 444 444
36,839 21,954 0 43,731 30,814
Group thereof due in Group thereof
Sept. 30, 2002 up to more than Sept. 30, 2001 due in
Total one year five years Total up to one year
€ thousand € thousand € thousand € thousand € thousand
Bonds 1) 285 0 0 302 0
– thereof convertible: € 285 thousand
(previous year: € 302 thousand)
Liabilities to banks 2) 26,339 11,739 0 31,862 19,334
Payments received on
account of orders 1,027 1,027 0 1,832 1,832
Trade payables 9,151 9,151 0 10,651 10,651
Liabilities on bills accepted
and drawn 46 46 0 98 98
Other liabilities 4,031 4,031 0 3,430 3,342
- thereof taxes 835 835 0 761 761
- thereof social security 750 750 0 701 701
40,879 25,994 0 48,175 35,257
(12) Cost of materials
(13) Personnel expenses
(14) Other operating expensesOther operating expenses in the single-entity and consolidatedfinancial statements primarily relate to expenses for marketingand freight, general administration, the provision of warranties,rental costs, leasing fees and sales commissions.
(15) Financial result
Amortization of financial assets relates to the amortizationof long-term investments at KGF AG-Kuchl. Interest
expenses include the interest portion of the leasing financingfor the factory in Laupheim in the amount of € 463 thousand.
(16) Taxes on income
Effective taxes in the single-entity and consolidated financialstatements include additional taxes amounting to € 150 thousand due to the risks arising from an external tax audit.
The Group's deferred tax expenses stem in particular from areduction in intercompany profit elimination.
(17) Other taxesOther taxes in the single-entity and consolidated financialstatements include expenses of € 468 thousand connectedwith external tax audits in Germany and abroad.
OTHER DISCLOSURESSegment reportingThe Kässbohrer Geländefahrzeug AG Group has two businessunits: vehicles for maintaining ski slopes and trails(PistenBully) and for beach cleaning (BeachTech). Theseform the two product-oriented segments of the Company’soperating activities and reflect its opportunities and riskstructure. Within the two segments there are similarities, inparticular in respect of products and services, customergroups, sales channels and the type of provision of services.The transfer prices for intragroup sales are determined in linewith market conditions.
Since the assets are principally used by both segmentstogether and liabilities are allocated jointly to the two segments, they were allocated in proportion to sales (with theexception of inventories and receivables). Interest expenseand income were also allocated in proportion to sales.
The result from ordinary activities is disclosed as the segment result.
The information on the geographical regions relates toEurope, North America and the rest of the world. Theseregions reflect the risk structure of the Company's business
activities. None of the regions in the rest of the world generates more than 10% of consolidated sales.
(1): The loss is the result of the development expenses required for the new BeachTech Marina.
Sales are classified by geographical region as follows:
Contingent liabilities
(1): This relates to bills discounted under the Italian law on sales financing.
Other financial obligationsOther financial obligations are due as follows:
Other financial obligations include leasing expenses in theamount of € 1,493 thousand p.a. for the building at theLaupheim site. The term of the leasing agreement runs untilAug. 31, 2020.
6564
PistenBully PistenBully BeachTech BeachTech Group total Group total
2001/2002 Short FJ 2001 2001/2002 Short FY 2001 2001/2002 Short FY 2001
€ thousand € thousand € thousand € thousand € thousand € thousand
Sales to third parties 129,579 28,565 2,601 1,833 132,180 30,398
Segment result
(Result from ordinary activities) 9,756 -7,352 -448 1) 86 9,308 -7,266
thereof:
Depreciation and
amortization expense 2,591 1,090 52 70 2,643 1,160
Interest income 453 190 9 12 462 202
Interest expenses 2,089 606 42 39 2,131 644
Assets 86,679 85,687 2,715 5,498 89,394 91,185
Investments 4,135 1,235 84 79 4,219 1,314
Liabilities 57,929 61,890 1,163 3,971 59,092 65,861
Europe Europe North America North America Rest of world Rest of world
2001/2002 Short FY 2001 2001/2002 Short FY 2001 2001/2002 Short FY 2001
€ thousand € thousand € thousand € thousand € thousand € thousand
Sales 85,393 13,791 22,340 4,300 24,447 12,307
Assets 68,568 63,334 20,826 27,851 0 0
Investments in
long-term assets 4,132 1,141 87 173 0 0
AG Group
2001/2002 Short FY 2001 2001/2002 Short FY 2001
€ thousand € thousand € thousand € thousand
Liabilities from
the issue and
transfer of bills (1)
3,643 2,973 3,643 2,973
Liabilities from
guarantees and
warranty agreements 404 392 404 392
4,047 3,365 4,047 3,365
AG Group
2001/2002 Short FY 2001 2001/2002 Short FY 2001
€ thousand € thousand € thousand € thousand
Cost of raw materials,
consumables and
supplies and of pur-
chased merchandise 62,520 33,895 64,474 32,068
Cost of purchased
services 901 626 3,712 1,681
63,421 34,521 68,186 33,749
AG Group
2001/2002 Short FY 2001 2001/2002 Short FY 2001
€ thousand € thousand € thousand € thousand
Wages and salaries 17,582 7,954 20,717 9,548
Social security and
other pension costs 3,635 1,636 4,867 2,136
– thereof old age
pensions 223 135 231 135
21,217 9,590 25,584 11,684
AG Group
2001/2002 Short FY 2001 2001/2002 Short FY 2001
€ thousand € thousand € thousand € thousand
Income from other
investments and
long-term loans 12 13 12 13
Other interest and
similar income 411 140 462 202
- thereof from
affiliated
companies (71) (120) (0) (0)
Amortization of
financial assets and
investments classi-
fied as current assets -4 -11 -4 -11
Interest and similar
expenses -2,120 -640 -2,131 -644
-1,701 -498 -1,661 -440
AG Group
2001/2002 Short FY 2001 2001/2002 Short FY 2001
€ thousand € thousand € thousand € thousand
Effective taxes 1,716 -1,648 1,758 -1,588
Deferred taxes 0 0 547 -1,620
1,716 -1,648 2,305 -3,208
AG Group
€ thousand € thousand
within the
next 12 months 2,597 5,577
between 13
and 60 months 7,900 14,627
after more
than 60 months 21,027 21,218
31,524 41,422
The following information relates to the product-oriented segments of the Kässbohrer Geländefahrzeug Group:
67
Average number of employees during the year
Disclosures in accordance with section 160 (1) clause 8 of the AktGKreissparkasse Biberach, Biberach, informed us in accordancewith section 21 (1) of the Wertpapierhandelsgesetz (WpHG –German Securities Trading Act) that its voting rights in KässbohrerGeländefahrzeug AG fell below the 75 % threshold on October 31,2001 and now amounts to exactly 20 %. The requirement in accordance with section 22 (1) clause 3 of the WpHG to notify theCompany when the voting rights to which it is entitled falls belowor exceeds certain thresholds has therefore been met.
Sexta GmbH, Ulm, informed us in accordance with section 21 (1)sentence 1 of the WpHG that its voting rights in KässbohrerGeländefahrzeug AG exceeded the 5 % threshold effective March27, 2002 and that it now holds 10.77 % of the voting rights inKässbohrer Geländefahrzeug AG. Sexta GmbH holds 10.77 % ofthe voting rights in accordance with section 22 (1) clause 1 of theWpHG via its subsidiary, Filius GmbH, Ulm.
UBH Unternehmens- und Beteiligungsholding mbH, Frankfurt,notified us in accordance with section 41 (2) sentence 1 of theWpHG that its voting rights in Kässbohrer Geländefahrzeug AGamounted to 24.98 % as of April 1, 2002.
Adolf Merckle, Blaubeuren, notified us in accordance with section41 (2) sentence 1 of the WpHG that he holds 24.98 % of the votingrights in Kässbohrer Geländefahrzeug AG in accordance with section 22 (1) clause 1 of the WpHG as of April 1, 2002 via hissubsidiary, UBH Unternehmens- und Beteiligungsholding mbH,Frankfurt.
SüdKA SüdKapitalanlagegesellschaft mbH, Frankfurt, notified usin accordance with section 41 (1) of the WpHG that its votingrights in Kässbohrer Geländefahrzeug AG held via its special securities fund operated as a capital investment company exceededthe 5 % threshold before January 1, 2002 and remained unchangedat a level of 9.57% at the reporting date of April 1, 2002.
Deka Investment GmbH, Frankfurt, notified us in accordance withsection 41 (2) sentence 1 of the WpHG that its separate trust assetsinclude 9.44 % of the voting rights in Kässbohrer GeländefahrzeugAG as of April 1, 2002.
Kreissparkasse Biberach, Biberach, notified us in accordance withsection 41 (2) sentence 1 of the WpHG that its voting rights inKässbohrer Geländefahrzeug AG amounted to 39.01 % as of April1, 2002.
Declaration of conformity in accordance with section 161 of the AktGThe declaration of conformity with the German CorporateGovernance Code in accordance with section 161 of the AktGwas submitted by the Managing and Supervisory Boards andmade available to the shareholders.
Filing of accountsThe consolidated financial statements of KGF AG are filed withBiberach Local Court.
Proposal on the appropriation of profitsThe Managing Board and the Supervisory Board propose toappropriate the net retained profits of KässbohrerGeländefahrzeug AG, Laupheim, as follows:
Executive bodies of Kässbohrer Geländefahrzeug AGThe Managing Board of Kässbohrer Geländefahrzeug AG comprised the following members during the fiscal year:
Dr. Hendrik Grobler, Chairmanresponsible for technology, research and development, sales and service
Rolf Glessing responsible for finance and financial control, materials management and logistics, personnel, data processing and organization
The Company is represented jointly by the Managing Boardmembers or by a member of the Managing Board together witha Prokurist (authorized signatory).
The Company has a Supervisory Board as defined in Article 9of the Articles of Association, which comprises three members.The Supervisory Board comprised the following membersduring the fiscal year:
Ludwig Merckle ChairmanPracticed profession: Managing Director of Merckle GmbH Chairman of the Supervisory Board of: • Württembergische
Leinenindustrie AGAlso member of the following Supervisory Boards:• HeidelbergCement AG• MCS Modulare Computer und
Softwaresysteme AG
Dr. Otmar Weigele Deputy ChairmanPracticed profession: Chairman of the Managing Board of Kreissparkasse BiberachAlso member of the following Supervisory Boards:• Öchsle Bahn AG• SV Sparkassen-Versicherung AG,• Genossenschaft für Wohnungsbau
Oberland eG• Grundstücks- und Baugesellschaft AG
• Alternate member of the AdvisoryBoard of the municipal supply association of Baden-Württemberg
Dr. Susanne FrießPracticed profession: Managing Director of VEM, Vermögensverwaltung GmbH, LawyerChairman of the Supervisory Board of:• Bastfaserkontor AGAlso member of the following Supervisory Board:• Pommersche Provinzial
Zuckersiederei AG
The remuneration for the Managing Board members ofKässbohrer Geländefahrzeug AG totaled € 640 thousand in fiscal year 2001/2002, € 436 thousand of which relates to fixed remuneration and € 204 thousand to variable, performance-based remuneration. In addition, the ManagingBoard members were issued convertible bonds in 1999 in theamount of € 82 thousand; after a lock-up period of two years,these bonds can be successively converted to shares over a period of an additional four years. In fiscal year 2001/2002, € 6 thousand in bonds was converted to 2,400 shares. Provisionsfor the pensions of former Managing Board members have beenset up in the amount of € 532 thousand. The former Managing
Board members received remuneration of € 63 thousand in fiscal year 2001/2002. The remuneration of the SupervisoryBoard for its activities during fiscal year 2001/2002 amountedto € 48 thousand.
Kässbohrer Geländefahrzeug AG, Laupheim, November 2002The Managing Board
Dr. Hendrik Grobler, Rolf Glessing
66
€ thousand
Dividend of € 0.30 per share, for 5,002,400 shares 1,501
Allocation to other revenue reserves 3,500
Account carried forward 1,008
Net retained profits 6,009
AG Group
2001/2002 Short FY 2001 2001/2002 Short FY 2001
Hourly-paid
workers 162 164 206 204
Salaried
employees 186 175 220 208
348 339 426 412
We have audited the single-entity financial statements includingthe bookkeeping of Kässbohrer Geländefahrzeug AG, as well as its consolidated financial statements and the combined management report and Group management report for the fiscalyear from October 1, 2001 to September 30, 2002. The pre-paration of these documents in accordance with German commercial law is the responsibility of the legal representativesof the Company. Our responsibility is to express an opinion,based on our audit, on the single-entity financial statements,including the accounting, on the consolidated financial statements, and on the combined management report and Groupmanagement report.
We conducted our audit of the financial statements in accordance with section 317 of the HGB (German CommercialCode) and the German generally accepted standards for the auditof financial statements promulgated by the Institut derWirtschaftsprüfer (IDW). Those standards require that we planand perform the audit such that misstatements and violationsmaterially affecting the presentation of the financial position andresult of operations in the single-entity and consolidated financial statements in accordance with principles of properaccounting and in the combined management report and Groupmanagement report are detected with reasonable assurance.Knowledge of the business activities and the economic and legalenvironment of the Company and the Group, and the expectationof possible errors, are taken into account in the determination ofthe audit procedures. The effectiveness of the internal accountingcontrol system and the evidence supporting the disclosures in thebooks, single-entity financial statements and consolidated financial statements, and in the combined management reportand Group management report are examined primarily on a testbasis within the framework of the audit. The audit includes assessing the accounting principles applied and significant estimates made by the legal representatives, as well as evaluatingthe overall presentation of the single-entity and consolidatedfinancial statements and the combined management report andGroup management report. We believe that our audit provides areasonable basis for our opinion.
Our audit has not led to any reservations.
In our opinion, the single-entity and consolidated financial statements of Kässbohrer Geländefahrzeug AG, Laupheim, givea true and fair view of the financial position and results of operations of the Company and the Group in accordance with theprinciples of proper accounting. In all material respects, the combined management report and Group management reportgives a true and fair view of the Company and of the Group andaccurately presents the risks inherent in the future development.
Stuttgart, November 15, 2002
Prof. Dr. Binder, Dr. Dr. Hillebrecht & Partner GmbHWirtschaftsprüfungsgesellschaft, Steuerberatungsgesellschaft
Bacher SchupeckWirtschaftsprüfer Wirtschaftsprüfer (auditor) (auditor)
68
Audit Opinion