Annual report 2008 - Advanced Inflight Alliance AG

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Effective June 04, 2008, the Management Board used the resolution of the Annual General Meeting on July
02, 2007, and launched yet another share buy-back program entailing 300,000 shares with the approval
of the Supervisory Board. This share buy-back program was limited until September 30, 2008. A total of
EUR 534,568.46 was paid for the share buy-back. The shares were retired pursuant to a resolution of the
Management Board dated October 31, 2008. The share capital was reduced accordingly by EUR 300,000.00
to EUR 14,500,000.00. The capital reduction was recorded in the Commercial Register on December 05,
2008.
We acquired Fairdeal Multimedia Pvt. Ltd., which is domiciled in Mumbai (formerly known as Bombay),
India, on August 13, 2008. The trade with worldwide film rights constitutes Fairdeal‘s core business. Roughly
60% of the company‘s sales are generated through licenses for Indian movies. Fairdeal generates additional
revenue through Indian TV programs, service fees, audio programs, and additional services. We were able
to finance the acquisition price, which was in the low single-digit millions, on our own.
Prof. Dr. Manfred Niewiarra, longtime member of the Supervisory Board, resigned his office as of the reporting
date, according to internal regulations regarding the retirement age of executives into account.
II. Results of operations, financial position and net assets
1. Profit or loss
Sales
Once again, consolidated sales climbed substantially during the reporting period by about 26% to EUR
107.4 million, up from EUR 85.1 million the previous year. The sales for the 2007 financial year were adjusted
pursuant to IAS 8; in this regard, please see the disclosures in the notes to the consolidated financial
statements. Roughly one half of this increase results from the initial consolidation of the sales of our new
subsidiary, DTI. The sales of our new subsidiary, Fairdeal, were consolidated from the August 2008 acquisition
date. The film licensing segment remained insignificant in the 2008 financial year as well. In terms
of the distribution by region of the operating sales in the inflight entertainment segment, Europe accounts
for sales of approximately EUR 38 million, North-America for approximately EUR 26 million, and the other
regions (Asia, Australasia, etc.) for EUR 43 million.
Earnings
Starting with the 2008 financial year, the company is reporting earnings before interest, taxes, depreciation
and amortization (EBITDA) and earnings before interest and taxes (EBIT) including both interest expense and
interest income. The two key figures were calculated as earnings before interest expense until the 2007
financial year. As a result, the two key figures also included interest income up to and including the 2007
financial year, which limits their comparability. Based on the same method of calculation, the two figures
for the previous year decrease by the previous year‘s interest income of EUR 928 thousand.
The previous year‘s figures were also affected by the aforementioned adjustment in accordance with IAS 8.
The previous year‘s figures stated in this management report were determined on a proforma basis.
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