Earnings before interest, taxes and amortization (EBITA) of product know-how increased yet again in the period under review. Wincor Nixdorf thus further improved its earnings strength in fiscal 2005/2006. EBITA before amortization of product know-how increased by 18% and totaled €161 million (previous year: €137 million). Return on sales at EBITA level was up 0.4 percentage points to 8.3% (previous year: 7.9%). This excellent performance was the combined result of the rise in net sales, economies of scale in products and the “Prolmprove” profit enhancement program.

We counter exchange rate fluctuations that could have adverse effects on profit through comprehensive natural hedging techniques such as vendor selection and location-related decisions. We also make use of financial derivatives.

The financial result (finance costs minus finance income) was dominated by expense items. The net result was €13 million (previous year: €20 million). This includes interest expenses for pension obligations of Wincor Nixdorf International GmbH in the amount of €4 million (previous year: €7 million), which were reported as finance costs prior to the establishment of the Contractual Trust Arrangement (CTA) effective from June 30, 2006.

Since the establishment of the CTA, income and expenses attributable to pension obligations are recognized as functional costs. In fiscal 2005/2006, €3 million interest costs for pension obligations, €21 million (previous year: €1 million) actuarial losses from changes in interest rates and other parameters, as well as returns from plan alterations of €9 million (previous year: €0 million) and returns of plan assets of €3 million (previous year: €1 million) were recognized as functional costs.

Profit before taxes increased by €37 million or 41% to €128 million (previous year: €91 million). The Group's effective tax rate in the fiscal year under review was 36% (previous year: 39%).

Net profit for the period increased by €26 million or 46% to €82 million in the fiscal year under review (previous year: €56 million). Thus, net profit for the period improved to 4.2% (previous year: 3.2%).

The Group's enhanced earnings strength can also be seen in the increase in profit for the period before carve-out expenses. This climbed to €94 million (previous year: €72 million). Product know-how was created at the Company's carve-out from the Siemens Group in 1999.