Standardkessel Baumgarte Annual Report 2008

ANNUAL REPORT 

2008

KEY FIGURES AND ORGANISATION 

2008 

KEY FIGURES 

Order intake 156,0 

Sales 200,0 

Order backlog 204,5 

Earnings before tax 7,9 

Employees 265 

Equity 20,8 

Cash & cash equivalents 141,4 

Figures in million euro 

STANDARDKESSEL 

POWER SYSTEMS HOLDING GMBH 

Plants and Components Service 

Contracting 

Standardkessel Baumgarte Holding GmbH 

Standardkessel GmbH 

Baumgarte Boiler Systems GmbH 

Standardkessel Baumgarte Service Holding GmbH 

Standardkessel Baumgarte Service GmbH 

emc Germany GmbH 

TOO emc Kazakhstan LLP 

Standardkessel Baumgarte 

Contracting GmbH

CONTENTS 

02 COMPANY PROFILE 

10 PLANTS AND COMPONENTS 

18 SERVICE 

24 CONTRACTING 

33 MANAGEMENT REPORT 

34 EXPANSION OF THE BUSINESS MODEL IN 

CONJUNCTION WITH ONGOING POSITIVE 

DEVELOPMENT 

34 SUSTAINED HIGH DEMAND LEVEL; 

UNCERTAINTY DUE TO TURBULENCE 

ON THE FINANCIAL MARKETS AND 

SUBSTANTIAL ECONOMIC RISKS 

36 BUSINESS DEVELOPMENT 2008 

38 RESEARCH AND DEVELOPMENT 

38 PROCUREMENT 

39 EMPLOYEES 

39 RISK MANAGEMENT 

41 OUTLOOK 

42 ANNUAL FINANCIAL STATEMENTS 

42 BALANCE SHEETS 

44 CONSOLIDATED INCOME STATEMENT 

45 CONSOLIDATED CASH FLOW 

46 CHANGES IN GROUP EQUITY 

48 NOTES 

1

2 

CAN YOU MEASURE EXPERIENCE?

Company P rofile 

3

4 

YES! 

AND THAT’S THE WAY IS SHOULD BE. 

BECAUSE IF YOU INVEST IN YOUR ENERGY 

SUPPLY SYSTEM, YOU HAVE TO BE SURE 

THAT YOUR PARTNER HAS EVERYTHING 

UNDER CONTROL, IN ORDER TO AVOID 

COSTLY DELAYS PRIOR TO COMMISSIONING 

AND DOWNTIMES DURING OPERATION. 

BOTH OUR CUSTOMERS AND OUR 

FIGURES SPEAK FOR STANDARDKESSEL 

BAUMGARTE.

56,940DAYS 

of efficient energy supply powered by our ideas 

1,000 PLANTS 

360 DEGREE 

100 PERCENT 

commitment from us 

You can expect 

We have already successfully developed and realised 

We have a 

perspective when we take on new tasks and challenges 

265 EMPLOYEES 

are dedicated to our »Ideas full of Energy« 

Company Pr ofile 5

« WE ARE CONFIDENT ABOUT 

THE DEVELOPMENT OF 

OUR COMPANIES.» 

6

With regard to the key figures, the Standardkessel Baumgarte 

Group continued its positive development of the previous year 

in financial year 2008 as well. In addition to the plants and 

components business segment, we will also be focusing on both 

the service and contracting business segments in the future. Our 

successful re-entry into the service area in financial year 2008 

received an extremely positive response from our customers. 

In the past, customers have frequently requested even more 

extensive service and support in implementing their projects. This 

prompted us to expand our business model to include contracting 

solutions, so that we could offer our customers comprehensive 

support during the entire project – ranging from project 

development, financing, and plant management up to private 

equity participation in a project or project company. The expansion 

of our business model leads to a multitude of synergetic 

effects for the entire Group. 

With all due respect to the current economic situation, we are 

still confident about the development of our companies. Despite 

the economic indicators, the market conditions in the plants and 

components business segment offer the right prerequisites for 

continued successful development. In the service segment, we 

are looking forward to major growth, and expect the Contracting 

division to give momentum to the entire Group. 

From left to right 

Jörg Klasen 

Lutz Reinery 

Filip Ackerman 

Jörg Böwe 

Company Pr ofile 

7

8 

OUR RANGE OF SERVICES: 

EFFICIENT SOLUTIONS FOR 

PLANTS AND COMPONENTS 

SERVICE 

CONTRACTING

IN AN ERA OF HIGH ENERGY COSTS 

AND DEPLETING RESOURCES, THE TOPIC 

OF EFFICIENT ENERGY PRODUCTION IS 

BECOMING INCREASINGLY MORE IMPOR- 

TANT. A DEVELOPMENT THAT ALSO 

BENEFITS STANDARDKESSEL BAUMGARTE, 

SINCE OUR KNOW-HOW IN THE THERMAL 

RECYCLING OF A WIDE RANGE OF FUELS 

IS MORE IN DEMAND THAN EVER. 

FROM ENERGY SUPPLIERS, MUNICIPALITIES, 

UTILITY COMPANIES, AND INDUSTRIAL 

FIRMS. 

WHETHER FOR COMPLETE PLANTS, COMPO- 

NENTS, SERVICE, OR CONTRACTING. 

DISCOVER WHAT SETS US APART. 

Company P rofile 

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10 

PLANTS AND COMPONENTS 

DO YOU WANT TO COMPLETELY 

OVERHAUL YOUR ENERGY SUPPLY 

SYSTEM? WITH A NEW PLANT AND A 

CUSTOMIZED TECHNICAL SOLUTION? 

ONE THAT IS EFFICIENT, GREEN, AND 

ECO-FRIENDLY? AND ONE THAT IS 

DEVELOPED AND IMPLEMENTED BY A 

PARTNER THAT IS EXPERIENCED, RELIABLE, 

AND ON-SCHEDULE? THEN YOU HAVE 

COME TO EXACTLY THE RIGHT PLACE: 

STANDARDKESSEL BAUMGARTE.

Plants and Components 

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12 

1 3 5 

2 4 6 

TASKS AND FUELS ALWAYS VARY. BUT 

OUR MISSION ALWAYS STAYS THE SAME: 

TO SUPPLY YOU WITH A TECHNICALLY 

ADVANCED PLANT

7 9 

8 10 

There are numerous ways to generate 

heat, steam and electricity from a wide 

range of fuels. We know them. And more 

importantly: we specialise in them. 

And that's exactly why you can profit 

from our expertise, because we utilise 

our extensive process know-how in every 

project – no matter which fuel it involves. 

Below are a few examples. 

Household Waste and Ordinary 

(Household-like) Industrial and 

Commercial Waste 

The thorough and environmentallyfriendly 

disposal of household waste and 

ordinary (household-type) industrial waste 

is a global challenge. We meet it with 

state-of-the-art plant technology. 

Refused Derived Fuels 

An important factor in the closed loop 

recycling economy is the generation of 

refused derived fuels (RDFs) from waste. 

RDFs are used in power plants for generating 

municipal energy and in industrial 

power plants for meeting the demand for 

process energy. 

Solid Industrial Residues, Liquid and 

Gaseous Industrial Residues 

The worldwide production of consumer 

goods is increasing steadily. The industrial 

production residues arising from this can 

be used as alternative fuels for generating 

energy. Green and efficient. 

Waste Wood, Wood Residues, Fresh 

Wood, Forest Waste, Tree Prunings, 

Peat, Bark 

Wood of all types has been used forever 

to generate heat and energy. Since the 

enactment of the German Renewable 

Energy Sources Act (EEG), wood as a 

fuel has been becoming more and more 

important as an eco-friendly source of 

energy – and not only in Europe, but 

throughout the entire world as well. 

The leading European pioneer in this 

segment: Standardkessel Baumgarte. 

Olive Waste, Rice Husks, Other 

Biogenic Residues 

Of course, when it comes to green, CO 2 - 

neutral energy recovery, all other types 

of biogenic energy sources are also in 

demand. 

Gas Turbine Waste 

Heat recovery boilers downstream of gas 

turbines are important process units for 

the efficient utilisation of energy arising 

from gas and steam turbine processes. 

Heat recovery boilers use the gas turbine 

waste for generating steam, and most 

1 Bremen/Germany 

Energy source: Household and 

Industrial Waste 

2 Stavenhagen/Germany 

Energy source: Refuse Derived Fuel 

3 Weener/Germany 

Energy source: Refuse Derived Fuel 

4 Tiefstack/Germany 

Energy source: GT Waste Gas, 

Natural Gas 

5 Twence/Netherlands 

Energy source: Waste Wood, 

Wood Residue 

6 Eberswalde/Germany 

Energy source: Fresh Wood 

7 Dunkirk/France 


Blast Furnace Gas, Coke Oven Gas, 

and Natural Gas 

8 Varel/Germany 


Natural Gas 

9 Jülich/Germany 

Energy source: Brown Coal, 

Hard Coal 

10 Allington/Great Britian 

Energy source: Municipal, 

Household and Industrial Waste 

boilers are also equipped with an auxiliary 

firing system to boost the overall 

efficiency of the entire plant. 

Waste Heat and Exhaust Gases from 

Industrial Processes 

Waste air and exhaust gases generated 

during industrial processes can potentially 

be useful as high-energy heat sources. For 

example, via heat recovery boiler systems 

placed downstream of the processes, 

which convert the energy contained in 

the waste air and exhaust gas flow into 

hot water, process steam, or electricity to 

meet your in-house energy demands. 

Natural Gas, Heavy Fuel Oil, 

Light Fuel Oil 

Despite mounting energy and fuel costs 

worldwide, gas and oil are still fuels in 

great demand. The benefits of gas and oil 

include high operational reliability and important 

characteristics such as quick-start 

characteristics and load change rates. 

Hard Coal, Brown Coal Briquettes, 

Brown Coal Dust 

Price stability and secure supply are but 

two important factors that make coal 

suitable for use as an alternative fuel in 

place of natural gas and oil. 


13

Jan T. Rooijakkers, Managing Director Twence B.V 

«In Standardkessel, we had a dependable supplier for our 

biomass power station that installed and commissioned the plant 

in line with our requirements and objectives. An entire team 

comprised of our own and external employees worked together 

in excellent co-operation with the employees of Standardkessel 

and its suppliers in building the biomass power plant. I would 

especially like to thank everyone involved for their commitment 

during this huge project. The results are impressive!» 

Sample Reference: 

BEC Twence Biomass-fired Power Plant 

« THE RESULTS ARE 

IMPRESSIVE!» 


15

Sample Reference: 

Weener Energie Steam Power Plant, Germany 

« WITH BAUMGARTE 

BOILER SYSTEMS, 

WE WERE IN THE 

BEST HANDS» 

16 

Ingo de Buhr, Managing Director 

PROKON Nord Energiesysteme GmbH 

«As an innovation-driven company, we have long been utilising 

energy solutions that are both economically and ecologically 

sustainable. Whether it be wind parks, biomass power stations, 

or plants that use refuse derived fuels to generate energy, such 

as the steam power plant in Weener. In cooperation with the 

Klingele Papierwerke paper mill, the Weener paper factory, 

and PROKON Nord Energiesysteme, a plant was built that uses 

mechanically-biologically treated municipal waste and commercial 

waste to generate thermal energy. As compared to the previous 

situation, the thermal energy generated there replaces 32 million 

m 3 of natural gas, thereby reducing C0 2 emissions by 55,000 

tons annually. A challenging project that could only be realised 

by partners that really know their trade. Like Baumgarte Boiler 

Systems does. The collaboration was professional, co-operative, 

and always productive. After a construction phase of just 2 years, 

the plant was handed over in June 2008, right on-schedule. All in 

all an extremely positive experience that prompted us to rely on the 

expertise of Baumgarte Boiler Systems for the RDF plant in Stade 

(Germany), as well.»


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18 

SERVICE 

STANDARDKESSEL BAUMGARTE HAS 

EXTENSIVE PROCESS KNOW-HOW. SO 

WHAT COULD BE MORE LOGICAL THAN 

OFFERING YOU OUR EXPERTISE IN THE 

SERVICE SEGMENT, AS WELL? 

THERE'S NOTHING WE'D RATHER DO!

Service 

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20 

PERFORMING FUNCTIONAL CHECKS, 

INCREASING EFFICIENCY, OR OPERATING THE 

PLANT. JUST SOME EXAMPLES OF HOW YOU 

AND YOUR PLANT CAN BENEFIT FROM OUR 

RANGE OF SERVICES.

Investing into a plant is not just about the right concept and its subsequent implementation. The topic of service is important, as well, 

since smooth operation is the be-all and end-all of an efficient plant. That's exactly where Standardkessel Baumgarte comes in. With a 

wide range of services – from commissioning up to maintenance and complete plant operation. 

Engineering 

We define tasks, prepare plant status 

reports, evaluate measurements and 

measurement logs, recommend measures, 

and provide planning and implementation 

engineering as well as quality assurance 

services. 

Construction and Assembly 

Our scope of services includes taking 

inventory of the actual, current status, 

preparing a list of measures for modernisation 

options, and carrying out the 

modernisation plan. 

Commissioning 

We perform functional checks, calibrations, 

and tests for the individual units, 

conduct overall functional tests, prepare 

and execute the trial operation – and 

complete this step by supplying the 

performance record. 

Maintenance 

Maintenance includes annual plant audits, 

repairs, component optimisation, and 

spare parts management. 

Plant Optimisation 

We identify any need for optimisation as 

regards availability, emissions, operating 

costs, efficiency, etc. 

Modernisation 

What can be done to modernise your 

plant? We take inventory of the actual, 

current status, prepare a list of measures, 

and also take care of implementing the 

modernisation plan. 

Plant Operation 

We operate the complete plant on your 

behalf. After all, our service knows no 

boundaries. 

Service 

21

Sample reference: 

Gelsenkirchen Innenstadt (Downtown) 

Heating Plant, Germany, Evonik Fernwärme GmbH 

« STANDARDKESSEL 

BAUMGARTE SERVICE 

WAS OUR FIRST 

CHOICE.» 

22 

Dieter Schwarz, Manager of District Heating Plant 

Division, Evonik Fernwärme GmbH, Essen/Germany 

«A while ago, we converted our plant from coal to light fuel oil 

operation. In the course of the conversion, the filter elements 

of the no longer needed electric filter system were dismantled, 

so that we could use the filter housing as a part of the exhaust 

gas duct. Under certain ambient conditions, however, the soot 

measurement values increased during the start-up process. These 

measurement values could not be explained by soot formation, 

since the boiler settings had already been optimised in advance. 

To resolve the issue, we contacted Standardkessel Baumgarte 

Service, because we knew that this newly established company 

is backed by the experience of the Standardkessel Baumgarte 

group, which was a decisive factor for us. 

We solved the problem, which was caused by passing below 

the dew point, in a concerted effort. Standardkessel Baumgarte 

Service installed an additional, insulated exhaust gas duct in the 

filter housing, which eliminated the dew point issue. Subsequent 

measurements showed that this solution worked perfectly.»

Service 

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CONTRACTING 

YOUR COMPANY NEEDS A WHOLE LOT 

OF ENERGY. FOR EXAMPLE IN THE FORM 

OF ELECTRICITY OR HOT STEAM. OR FOR 

COOLING PURPOSES. WOULDN'T IT BE 

NICE TO BE INDEPENDENT FROM 

FLUCTUATING MARKET PRICES AND 

EXTERNAL ENERGY PROVIDERS? AND 

DOESN'T IT ADD UP IF YOU GENERATE 

YOUR ENERGY ON-SITE? POWERED 

BY AN EXPERIENCED TECHNOLOGY 

PARTNER? LETTING YOU FOCUS ON THE 

MAIN THING: YOUR CORE BUSINESS.

Contracting 

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MORE AND MORE COMPANIES ARE 

OPTING FOR DECENTRALISED ENERGY 

SUPPLY. HOWEVER, PLANNING, FINANCING, 

REALISING, AND OPERATING A PLANT ARE 

DEMANDING TASKS. GOOD TO KNOW 

THAT THERE ARE SOLUTIONS AND EXPERTS 

AROUND: CONTRACTING. COURTESY OF 

STANDARDKESSEL BAUMGARTE.

There are many reasons in favour of energy 

contracting. And even more reasons 

to decide for Standardkessel Baumgarte 

Contracting. With over 1,000 successful 

plant and system construction projects 

and more than 80 years of experience, 

we have the technical, administrative, 

and organisational know-how needed 

to guarantee your energy supply. And to 

make your energy, maintenance, and servicing 

costs manageable in the long term. 

Whether feasibility analyses, engineering, 

approvals, operating company models, 

financing, construction, operation, 

maintenance – at your request, we take 

care of everything that needs to be done 

and develop a customised concept for 

your company. You decide what should 

be included in the scope of our energy 

contracting services, from consulting up to 

establishing a joint venture. 

Utilise our know-how. To your benefit. 

Contracting 

27

INTERVIEW 

« MRS O'BRIEN, 

WHEN IT COMES 

TO ENERGY SUPPLY, 

YOU RELY ON 

CONTRACTING. 

WHY?» 

28 

Navestas, headquartered in the UK, plans and develops projects 

dealing with the thermal recycling of residue and waste materials 

for generating energy. The latest project: Development of a 

biomass plant fuelled by waste wood and wood residue for the 

purpose of producing energy and, if required, heat which can 

be fed into the public network. The required fuel quantities are 

already contractually secured. For planning and implementing the 

project, Navestas not only looked for a technology partner with a 

proven track record in constructing waste wood-fuelled biomass 

plants. It was also very important to the company that an energy 

contracting model be used to realise the plant. Pauline O'Brien, 

co-owner of Navestas, talks about the reasons. 

Mrs O'Brien, energy is a considerable cost factor. To be 

less dependent on energy providers, you are planning to 

build a waste wood-fuelled biomass plant using an energy 

contracting model. Why did you choose Standardkessel 

Baumgarte Contracting as your partner? 

Pauline O’Brien We realised that the implementation of such 

a project requires a wealth of know-how and major effort. 

Our core competence is waste disposal, as you know, but up to 

now, we have never developed our own biomass plant, let alone

operated it. The first step, obtaining approval for planning a 

plant, is already difficult enough. Added to that is the challenge 

of securing suitable financing. And you have to keep in mind that 

building and operating such a plant is anything but easy. There are 

plenty of examples in the UK of how to not do it. Reason enough 

for us to choose the experience of Standardkessel Baumgarte 

Contracting. 

How is Standardkessel Baumgarte Contracting involved in 

the planning phase? 

Pauline O’Brien Standardkessel Baumgarte Contracting provides 

the entire input with regard to the technology and approvals. As 

far as financing is concerned, we are convinced that an equal 

partnership simplifies all of the financing issues. Together, both 

companies have the full spectrum of know-how required to 

successfully complete a project like this. We have comprehensive 

expertise in the field of waste disposal, we know the local 

framework conditions and business customs, and we have access 

to the personnel that need to be employed, etc. Standardkessel 

Baumgarte Contracting, on the other hand, has a track record 

of realising more than 40 exceptionally efficient biomass plants, 

which also meet the strictest German environmental standards. 

Isn't it true that the two companies have different 

interests? And doesn’t that give rise to a major potential 

for conflicts? 

Pauline O’Brien True enough, in theory. I mean Standardkessel 

Baumgarte Contracting could try to sell us the plant at an 

excessive price. In turn, we might be tempted to overcharge our 

supplier later on for the waste wood and waste residue used to 

fuel the plant. But in order to work, a partnership requires the 

highest level of mutual sincerity and honesty between the stakeholders. 

Both of our companies are realistic enough to preclude 

such conflicts right from the start. We agreed to cooperate in an 

“open-book” style. But what's even more important: We both 

know that there is more to gain here than just a smoothly functioning 

biomass plant. 

Mrs O'Brien, thank you very much for the interview. 

Contracting 

29

STANDARDKESSEL POWER 

SYSTEMS HOLDING GMBH, DUISBURG 

GROUP MANAGEMENT REPORT 

FOR THE 2008 FINANCIAL YEAR 

Group Management Report 

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1. Extension of the business model with continued positive 

development 

The Standardkessel Baumgarte Group continued the positive development of previous 

years in the 2008 financial year. Order intake amounted to EUR 156.0 million. The Group 

realised revenues of EUR 200.0 million in the reporting period with a work force of 265, 

and achieved a profit before taxes of EUR 7.9 million. The Group had liquid funds at the 

balance sheet date of EUR 141.4 million. Economic equity was EUR 20.8 million with an 

equity ratio of 19.7%. 

Apart from the existing plants and components business segment, the Standardkessel 

Baumgarte Group will also focus in future on the service and contracting business 

segments. Customer response to the Group’s successful re-entry into service business in 

the previous financial year was extremely positive. 

In the past, customers have approached us repeatedly about more extensive support 

in implementing projects. This has prompted us to extend our business model to allow 

us to offer our customers comprehensive support in contracting solutions throughout 

the entire project, ranging from project development, through financing and operational 

management to equity interest in a project or project company. This extension of the 

business model involves a substantial concentration of synergies for the whole Group. 

The extension of business activity was accounted for by adjusting the corporate 

law structure: the plants and components business segment is the responsibility of 

Standardkessel Baumgarte Holding GmbH with its operating subsidiaries Standardkessel 

GmbH and Baumgarte Boiler Systems GmbH while the service segment is the responsibility 

of Standardkessel Baumgarte Service Holding GmbH with the operating subsidiaries 

Standardkessel Baumgarte Service GmbH, emc Germany GmbH and TOO “emc Kazakhstan” 

LLP, and the contracting segment is the responsibility of Standardkessel Baumgarte 

Contracting GmbH. 

2. Sustained high level of demand; uncertainty due to turmoil in 

the financial markets and substantial economic risks 

The plants and components business segment offers systems to recover energy from biomass, 

residues, waste heat downstream of gas turbines and primary fuels with a regional 

concentration on Europe. 

The market development of large-scale biomass power plants depends both on price 

trend and availability of fuels and subsidies from the countries which differ greatly. European 

markets are developing very differently. An attractive market environment is currently 

developing, for example, in Great Britain and some Eastern European states. Notwithstanding 

this, we believe that business with the timber industry will continue. 

The incineration of residues is expanding worldwide: many countries can no longer meet 

the challenges of constantly increasing quantities of waste, and are focusing on waste 

incineration. As forerunner to this development, Europe has limited the disposal of un– 

treated municipal waste in landfills by law. In Germany, the market has stabilised fol-

lowing an investment boom in incineration plants and plants for refuse derived fuels. A 

boom similar to that in Germany is expected in several European countries in the next 

few years. 

We consider the development of energy recovery from waste heat downstream of gas 

turbines and primary fuels to be linked to the European and in particular German power 

plant market. Here too, corresponding forecasts are especially promising given the, in 

some cases, obsolete European power plant facilities. 

The service business segment provides numerous services, beginning with intelligent engineering 

for modernisation and optimising operations, through installation and startup 

to maintenance and complete operational management. 

Even if there is no consistent commitment to the OEM in the strongly fragmented German 

market for services relating to industrial power plants, the over 1,000 references of the 

Standardkessel Baumgarte Group form a sound basis for successful growth. In addition 

to new plants, there is currently a growing demand above all for modernisation, aimed 

at making older power plants more energy-efficient. The emc companies offer all-round 

services for gas turbines and are also moving into a growing market segment. 

The contracting business segment currently undergoing expansion offers the entire design 

and coordination of an energy production project from a single source. This covers all 

services from project identification through project development, realisation, operation of 

an energy recovery plant to an equity interest. Our customers can focus on their core business, 

relieve their balance sheet and participate in cost saving through outsourcing. As 

partner who can assume the role of contractor, plant supplier and operational manager, 

we contribute decisively in reducing interfaces. We can guarantee the material success 

factors of a project – functional capability of the plant and professional operational management 

– through our comprehensive know-how. The keen interest of our customers 

in this model demonstrates the material growth potential here for the entire Group. 

The positive market outlook is troubled by the turmoil in the financial markets which for 

some customers entails problems in project financing. The negative assessment of short 

and medium-term economic development is increasingly resulting in the postponement 

of investment projects. At the same time, the crisis involves considerable opportunities: 

where projects cannot be financed due to a lack of available capital resources, Standardkessel 

Baumgarte Gruppe can provide support in the form of its contracting model. The 

survival of energy-intensive industries depends on the price of electricity and steam; here 

too innovative technical solutions together with contracting models in particular are imperative. 


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3. Business trend 2008 

The previous year’s figures relate to the abridged financial year from 01.06. to 31.12.2007 

and for comparative purposes are therefore informative to a limited extent only. 

Order intake, revenues and order backlog 

The order intake of the Standardkessel Baumgarte Group in the reporting period was EUR 

156.0 million (compared with EUR 121.1 million in the abridged financial year and EUR 

206.8 million in the 2007 calendar year) while revenues amounted to EUR 200.0 million 

(compared with EUR 76.4 million in the abridged financial year and EUR 122.2 million in 

the 2007 calendar year). 

The plants and components business segment generated a key share in the order intake 

of EUR 149.1 million and revenues of EUR 195.1 million. Key orders taken in 2008 were 

an order to supply three energy recovery lines for refuse derived fuels (RDF) at the Bernburg 

site, an order for an RDF incineration line in Amsdorf, which is the same design as 

a plant supplied to the same customer in 2004 and an order for the installation of a heat 

recovery boiler plant for a new gas and steam line to supply electricity and steam to a 

paper mill in Plattling. The high revenues generated in the financial year are the result of 

an extremely high order intake the previous year. A boiler plant was invoiced for a waste 

incineration plant in Moscow, an RDF steam generator to supply energy to a paper mill in 

Weener and a power plant fired by biomass in Hengelo in the Netherlands. Other revenues 

resulted from processing diverse orders. 

The 2008 financial year for the service segment was primarily defined by the development 

and expansion of business activity. The segment generated an order intake of EUR 6.9 

million with revenues of EUR 4.9 million. 

Given its business model, the contracting business segment which was also new in 2008 

does not contribute to revenue and order intake but positive effects are anticipated in the 

utilisation of both the plants and components business segment and the service business 

segment. 

Due to high revenues, the order intake decreased from EUR 248.5 million at 31.12.2007 

as expected to EUR 204.5 million at 31.12.2008. In accounting terms, this order backlog 

represents a span of more than one year. 

As a result of employment arising from the order situation, all fields of activity of the operating 

companies – planning, proposal, construction, installation and commissioning – 

were fully utilised in the reporting period. Additional external personnel were employed 

in some areas. 

Earnings situation 

The result before taxes was EUR 7.9 million (compared with EUR 10.3 million) and this 

corresponds to a sales return of 4.0%. This positive result was essentially due not only to 

successful order processing but also to the control of technical and scheduled risks.

Assets and financial situation 

The balance sheet total rose at 31.12.2008 by EUR 38.2 million to EUR 185.9 million compared 

with the previous year (EUR 147.7 million). This increase was essentially due to the 

increased business volume and the resulting increase in credit balances at banks including 

securities of EUR 36.6 million. Apart from credit balances at banks including securities, 

which alone accounted for 76.0% of the balance sheet total, material assets were the intangible 

assets at EUR 23.8 million (compared with EUR 25.3 million), accounts receivable 

from manufacturing orders at EUR 3.7 million (compared with EUR 3.5 million) and trade 

accounts receivable at EUR 4.7 million (compared with EUR 4.3 million). 

Apart from equity, material liabilities are the obligations from manufacturing orders at 

EUR 115.4 million (compared with EUR 78.7 million), provisions of EUR 28.4 million (compared 

with EUR 28.8 million) and long-term liabilities due to banks at EUR 14.0 million 

(compared with EUR 18.4 million). 

Economic equity of the Standardkessel Baumgarte Group on the balance sheet date 

31.12.2008 was EUR 20.8 million (compared with EUR 16.9 million) including a subordinated 

shareholder loan of EUR 2.6 million. To determine the equity ratio, due to the high 

credit balances at banks typical in our kind of business, the balance sheet total is reduced 

by customer prepayments carried as liabilities amounting to EUR 80.2 million. The equity 

ratio thus determined is 19.7%. 

Credit balances at banks including securities were EUR 141.4 million (compared with EUR 

104.8 million) at 31.12.2008. The reason for this value is inter alia the positive cash flow 

of individual major orders. Part of this amount is deposited as cover for bank guarantees. 

The liabilities due to banks of EUR 14.0 million were not repaid, although this would have 

been possible at any time, in order to sustain liquidity given the current background of crisis 

in the financial markets and in view of a potential growth in the finance requirements 

of the contracting business segment. Adjusted by this effect of voluntarily stretching the 

balance sheet, the equity ratio is 22.7%. 

At the end of the financial year, the Group had a guarantee facility of EUR 110.0 million, 

thereof EUR 82.2 million or 74.7% was drawn on. 

Investments 

The companies of the Standardkessel Baumgarte Group invested EUR 1.0 million in intangible 

assets and property, plant and equipment in the past financial year. 

The assets, financial and earnings situation as a whole of the Standardkessel Baumgarte 

Group continues to be stable. 


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4. Research and development 

The research and development segment of the Standardkessel Baumgarte Group coordinates 

a host of order-related and overlapping innovation projects. 

The Group applies proven technology, as evidenced by over one thousand references. 

Solutions are developed for practically every order based on selected boiler technology 

which incorporate the customer’s respective technical specifications. This results in the 

development of many individual solutions in consultation with the customer to optimise 

the overall concept. 

Overlapping innovation projects are coordinated in parallel: apart from product optimisation 

and product enhancement (market research, investigations in primary fuels), standard 

conversions are developed for different components and entire system solutions 

standardised in close cooperation with customers and suppliers. 

In the area of surface coating, the patented process for thick nickel plating of surfaces 

was used in certain plants. Further transfers of know-how are expected in the next financial 

year. 

To further optimise incineration in stoker-fired boilers, Baumgarte Boiler Systems GmbH 

has further developed the process for tangential injection of secondary air, and this process 

is now available to our customers as a patented innovation. 

To diversify its product range, Standardkessel GmbH has focused on the Organic Rankine 

Cycle (ORC) process. This is a process to operate steam turbines with a working medium 

instead of steam. The process is primarily used when the available temperature level 

of the heat source is too low to operate a steam-driven turbine. SKG has analysed the 

market potential linked to this process and entered into a cooperation agreement with a 

company from the industry. 

The 3D construction and planning tool introduced over the past years was upgraded further 

in order to improve processes. 

5. Procurement 

The Standardkessel Baumgarte Group is concentrating its three business segments on engineering 

services and project management and all connected services. Accordingly, the 

former in-house manufacturing sites were already closed or sold to cooperation partners in 

previous years. Plants and components designed and constructed by the operating companies 

today are manufactured by appropriate sub-contractors and supplied from there directly 

to the respective construction site for installation by specialist assembly companies. Ongoing 

monitoring of production and installation by our own personnel guarantees a maximum in 

required quality. 

The low fixed costs structure resulting from this business model guarantees a high level of 

protection against demand fluctuations.

6. Employees 

The work force of the Standardkessel Baumgarte Group rose at the balance sheet date 

31.12.2008 to 265 employees (excluding trainees). This was an increase of 51 employees 

in the calendar year under review, 30 thereof were through acquisitions. Adjusted by these 

acquisitions, this is a personnel increase of 9.8%. 

The number of trainees also increased slightly in 2008: with 17 technical and 10 commercial 

trainees. Our aim is to lay the foundation for modern and consistent personnel development. 

Apart from classic training as technical draughtsman or industrial clerk, the Group 

offers three motivated young persons the opportunity to complete dual training and acquire 

the qualification of Bachelor of Engineering. In addition, students have the opportunity of 

gaining practical experience or writing practice-related diploma dissertations. 

As the need for well-trained and motivated employees will continue to increase, promotion 

of employee competence and strengths is an integral part of our personnel policy. The basis 

for sound personnel development was already established in previous years. Extensive personnel 

development programmes based on management audits carried out were conducted 

in the year under review and individual employees supported. Measures are continuously 

implemented. 

The performance-related reward system for all employees has shown once again in 2008 

that performance is worthwhile. Employees were able to reap the rewards of their work, 

ideas and creativity, in particular through the performance components of this system. 

7. Risk management 

The Standardkessel Baumgarte Group handles primarily long-term orders in plant construction. 

The consolidated annual financial statements cover any perceivable risks from such 

orders. A sound controlling system is applied to recognise risks from projects and order 

processing in good time. A risk early warning system has also been institutionalised. 

This risk early warning system aims to identify risks from corporate activities systematically, 

to evaluate and be able to control and monitor them risk-consciously. Risks endangering 

business are therefore excluded at the outset. Risk management itself is subject to 

continuous development and improvement. 

The principle risks of the Standardkessel Baumgarte Group are set forth below: 

Sales market risks 

The Standardkessel Baumgarte Group operates on markets which are strongly affected by 

legislation (subsidies for renewable energies, landfill prohibition etc.). Given the general 

trend towards greater environmental awareness, we anticipate an increase in legislation in 

Europe which will allow us to expand our business. 

Our group of companies depends on the utilisation of its capacities. Postponements or losses 

of orders can cause temporary under-utilisation and the associated impact on results which 

we can partly absorb through appropriate working time models. 


39

40 



The current situation on the financial markets can aggravate project financing for customers 

and lead to postponement or even abandonment of projects. At the same time the default 

risk of key customers can increase. In individual cases, we protect ourselves through default 

insurance. 

We limit customary bad debt risks by strict receivables management. 

Procurement market risks 

We limit strong fluctuations in raw material prices e.g. development in steel prices over 

recent years by obtaining binding offers from our suppliers before we enter into delivery 

obligations. 

We counteract capacity bottlenecks and price increases expected from our suppliers, as a 

result of the increased demand for large-scale power plants, by long term general agreements. 

At the same time in this way, we reduce the risk of depending on single suppliers 

for components requiring specialist know-how. 

The current situation on the financial markets can increase the bad debt risks of key suppliers. 

We try to assess default probability and actively limit the risks by using our industry 

knowledge. 

Specific risks in plant engineering 

The operating companies have focused consistently on key technologies. At the same 

time, the risks of new projects are analysed in detail at the proposal stage and at interdisciplinary 

level. This enables us to avoid orders we cannot handle technically, and significantly 

limits any other technical risks. 

Risks arise from total systems we construct with their high individual volumes primarily 

from impaired general conditions over the course of the project. At the same time, 

milestones and manufacturing deadlines are usually subject to contractual penalties so 

unforeseen risks in order execution can jeopardise the order result. The Standardkessel 

Baumgarte Group tries not to assure all risks associated with the handling of major orders 

but to leave some risks with the customer, and to pass on other risks to suppliers 

and insurers. Residual risks are actively managed through constantly optimised workflow 

management, the deployment of experienced and highly trained project managers and 

the reduction of interfaces. 

Personnel risks 

The continued success of our group of companies depends on our ability to recruit and 

retain qualified employees in the future. Capacity bottlenecks expected throughout the 

industry create a greater demand for people with know-how. We counteract the risk of 

losing good employees through personnel development programmes and basic conditions 

to create a pleasant working environment. 

Financial risks 

As our business requires a great number of guarantees, we have concluded several loan 

agreements with banks and surety insurers which assure an adequate credit line for the 

Standardkessel Baumgarte Group. The Standardkessel Baumgarte Group therefore de-

pends on the financing of this credit volume, without this however resulting in a risk to 

the company’s continued existence, which exceeds the extent associated with any credit 

financing. 

We minimise the risk from exchange fluctuations by hedging all material foreign currency 

receivables and liabilities by way of currency futures deals. 

8. Outlook 

With all due respect for the current economic situation, we are nevertheless confident of 

the future development of our companies. 

Despite the general economic situation, market conditions in the plants and components 

business segment provide the prerequisites for continued good development. In the 

service business segment, we expect marked growth and assume that the contracting 

segment will give positive impetus to the entire Group. 

The group’s order intake in the new 2009 financial year in the first two months is already 

over EUR 40 million. Apart from an order where SKG is acting as “Architect Engineer“ 

for a power plant in Emsland, an order for a heat recovery boiler was acquired for a gas 

and steam power plant in Hanover as well as a larger service order. Project volumes awaiting 

contract awards also offer the opportunity of good development in order intake in 

2009. 

This market situation together with the orders currently in execution allow us to project a 

positive result before taxes in operating budget and medium-term planning. 

Duisburg, 11 March 2009 

Jörg Klaus Klasen Filip Ackerman Lutz Reinery 


41

42 

CONSOLIDATED 

BALANCE SHEET PER IFRS 

AS OF 31 ST DECEMBER 2008 

ASSETS 

Long-term assets 

Intangible assets 

Property, plant and equipment 

Long-term financial assets 

Deferred income tax receivables 

Other short-term assets 

Raw materials and consumables 

Current income tax receivables 

Other assets 

Short-term financial assets 

Accounts receivable from manufacturing orders 

Trade accounts receivable 

Other financial assets 

Securities 

Cash on hand, credit balances at banks 

Note 31 st December 2008 (EUR) 31 st December 2007 (EUR) 

1 23,756,198.74 25,341,604.47 

2 2,164,958.09 2,007,027.39 

3 1,533,018.00 509,000.00 

27,454,174.83 27,857,631.86 

4 24,975.63 2,735,737.46 

27,479,150.46 30,593,369.32 

5 808,684.53 486,594.27 

6 3,688,231.29 1,721,776.58 

7 3,291,306.69 1,822,712.93 

7,788,222.51 4,031,083.78 

8 3,742,337.01 3,508,681.57 

9 4,693,333.17 4,272,576.11 

10 799,296.10 519,624.26 

11 7,148,492.70 22,023,509.58 

12 134,246,426.27 82,729,037.86 

150,629,885.25 113,053,429.38 

185,897,258.22 147,677,882.48

LIABILITIES 

Equity 

Subscribed capital 

Capital reserve 

Profit reserves 

Net income for the year 

Subordinated shareholder loan 

Long-term provisions 

Provisions for pensions 

Other provisions 

Deferred income taxes 

Long-term liabilities 

due to banks 

Short-term provisions 

Provisions for pensions 

Other provisions 

Current income taxes 

Short-term liabiities 

Financial liabilities 

Obligations from manufacturing orders 

Other financial liabilities 

Ohter short-term liabilities 

Note 31 st December 2008 (EUR) 31 st December 2007 (EUR) 

13 

28,000.00 28,000.00 

2,500.00 2,500.00 

5,000,000.00 7,329,086.71 

13,210,680.51 7,240,582.34 

18,241,180.51 14,600,169.05 

14 2,567,757.13 2,285,714.00 

15 7,187,527.96 7,124,629.21 

16 3,584,941.77 3,111,927.23 

10,772,469.73 10,236,556.44 

17 71,757.62 0.00 

18 14,025,000.00 18,375,000.00 

15 285,338.04 191,100.12 

16 17,358,669.02 18,326,696.29 

17,644,007.06 18,517,796.41 

1,040,314.50 3,416,494.00 

19 115,394,097.34 78,685,666.99 

20 5,545,720.00 0.00 

120,939,817.34 78,685,666.99 

21 594,954.33 1,560,485.59 

185,897,258.22 147,677,882.48 

Annual Accounts 

43

44 

CONSOLIDATED INCOME STATEMENT 

PER IFRS FOR THE PERIOD FROM 

1 ST JANUARY TO 31 ST DECEMBER 2008 

Sales revenues 

Manufacturing costs 

Gross profit (loss) on sales 

Administration costs 

Sales costs 

Research & development costs 

Other operating 

income and expense 

Operating result 

Financial result 

Profit (loss) before taxes 

Taxes on income 

Unappropriated retained earnings (loss) 

Note 2008 (EUR) 01.06. to 31.12.2007 (EUR) 

22 199,956,341.45 76,406,606.51 

23, 26 -181,928,835.64 -59,829,310.42 

18,027,505.81 16,577,296.09 

-6,744,494.80 -4,710,034.51 

-4,405,283.04 -2,260,553.04 

-753,715.98 -392,883.41 

23 -85,705.46 -11,493.19 

6,038,306.53 9,202,331.94 

24 1,870,104.44 1,116,010.07 

25 7,908,410.97 10,318,342.01 

25 -3,113,399.51 -2,841,416.10 

4,795,011.46 7,476,925.91

CONSOLIDATED CASH FLOW STATEMENT 

FOR THE PERIOD FROM 


Profit before taxes 

Taxes paid on income 

Depreciaion, amortisation and write-offs on 

intangible assets, and plant and equipment 

Financial result 

Change in provisions 

Change in inventories 

Payment on account carried as liabilities 


Trade accounts payable 

Change in other assets 

Change in other liabilities 

Price gains and losses for securities 

Cash inflow from interest 

Interest payments 

Cash flow from operations 

Cash inflow from retirement of fixed assets 

Financial assets 

Cash outflow for intangible assets 



Cash flow from investments 

Free cash flow 

Disposition of earnings 

Change in financial liabilities 

Cash flow from financing activities 

Change in freely available liquid funds 

Liquid funds as of 01.01. / 01.06. 

Liquid funds as of 31.12. 

Change in liquid funds 

Note 2008 (EUR) 01.06. to 31.12.2007 (EUR) 

25 7,908,410.97 10,318,342.01 

25 -4,418,192.04 -1,229.69 

1, 2 2,462,795.37 1,704,672.62 

24 -1,870,104.44 -1,116,010.07 

15, 16 -3,224,784.92 -7,093,636.62 

5, 8 -555,745.70 3,850,863.74 

19 21,043,650.93 16,523,254.52 

9 -420,757.06 -1,837,663.59 

19 15,664,779.42 -2,922,653.31 

536,804.03 -367,208.28 

4,580,188.74 876,946.30 

24 -555,987.79 1,500.00 

24 4,841,386.93 2,286,996.83 

24 -1,221,551.17 -948,118.76 

44,770,893.27 21,276,055.70 

2 0.00 22,268.91 

3 0.00 13,000.00 

1 -477,027.98 -275,856.88 

2 -558,292.34 -181,292.58 

3 -1,589,201.42 0.00 

-2,624,521.74 -421,880.55 

42,146,371.53 20,854,175.15 

-1,154,000.00 0.00 

0.00 -5,336.68 

-1,154,000.00 -5,336.68 

40,992,371.53 20,848,838.47 

86,377,547.44 65,528,708.97 

11, 12, 18 127,369,918.97 86,377,547.44 

40,992,371.53 20,848,838.47 


45

46 

CONSOLIDATED STATEMENT ON CHANGES 

IN EQUITY IN THE PERIOD 


see Note 13 

01.06.2007 

Net income 

31.12.2007 / 01.01.2008 

Net income 

Withdrawals from 

earned surplus 

Distributions to 

shareholders 

31.12.2008 

Subscribed capital Capital reserve Profit reserves Net income for the year Total equity 

(EUR) (EUR) (EUR) (EUR) (EUR) 

28,000.00 2,500.00 7,329,086.71 -236,343.57 7,123,243.14 

0.00 0.00 0.00 7,476,925.91 7,476,925.91 

28,000.00 2,500.00 7,329,086.71 7,240,582.34 14,600,169.05 

0.00 0.00 0.00 4,795,011.46 4,795,011.46 

0.00 0.00 -2,329,086.71 2,329,086.71 0.00 

0.00 0.00 0.00 -1,154,000.00 -1,154,000.00 

28,000.00 2,500.00 5,000,000.00 13,210,680.51 18,241,180.51


47

48 

GROUP NOTES 


Standardkessel Power Systems Holding GmbH 

47138 Duisburg, Baldusstraße 13 

Standardkessel Baumgarte Holding GmbH 




Baumgarte Boiler Systems GmbH 

33647 Bielefeld, Senner Straße 115 

Standardkessel Baumgarte Service Holding GmbH 

46049 Oberhausen, Duisburger Straße 375 

Standardkessel Baumgarte Service GmbH 




TOO "emc Kazakhstan" LLP 

120001 Kyzylorda A. Bokeikhan 47, Kazakhstan 

Standardkessel Baumgarte Contracting GmbH 


I. Explanations on the companies included in the consolidated 

accounts and their basis of valuation 

General information 

Standardkessel Power Systems Holding GmbH (SPSH) is the parent company of the 

Standardkessel Baumgarte Group and is a provider for the construction of boiler plants 

for the generation of heat and power, partly also the turnkey erection of complete power 

plants as well as the manufacture of steam boilers and similar equipment. The Group also 

provides qualified services and undertakes contracting business for boiler plants. 

The registered office of SPSH is located at Baldusstrasse 13, 47138 Duisburg (Germany). 

The consolidated financial statements encompass the following companies: 

(SPSH) 

(SBH) 

(SKG) 

(BBS) 

(SBSH) as of 02.09.2008 

(SBS) as of 31.01.2008 

(emc) as of 15.05.2008 

(emc KZ) as of 31.03.2008 

(SBC) as of 18.11.2008

GROUP NOTES 


Two non-operative subsidiaries were not included as they were not material for the consolidated 

financial statements. 

All amounts given in the notes are shown in KEUR (EUR x 1000). Due to the abridged 

financial year from 1st June to 31st December 2007, values from the previous year cannot 

be compared. 

The audited consolidated financial statements and group management report are deposited 

with Duisburg District Court under HRB 17458. The financial statements are 

expected to be released for publication by the management of Standardkessel Power 

Systems Holding GmbH at the end of May 2009. 

Basis of rendering accounts 

The consolidated financial statements of SPSH as reporting parent company for the financial 

year from 1st January to 31st December 2008 were prepared in application of Section 

315 a German Commercial Code (HGB) in accordance with the International Financial 

Reporting Standards (IFRS) promulgated by the International Accounting Standards Board 

(IASB), London, as adopted/applied by the European Union. All IASB standards and interpretations 

of the International Financial Reporting Interpretations Committee (IFRIC) 

applicable to the 2008 financial year, and the interpretations of the SIC Standing Interpretations 

Committee (SIC), its predecessor organisation, are accounted for in as far as 

they are endorsed by the EU. Further disclosure requirements under Section 315 a HGB 

are also met. 

The following new and amended standards and interpretations were adopted by the 

date the consolidated financial statements were prepared at 31st December 2008 but 

these only come into force at a later date, and were not applied prematurely to these 

consolidated financial statements. Their effects on the consolidated financial statements 

of Standardkessel Power Systems Holding GmbH have not yet been fully analysed so the 

effects anticipated and given at the bottom of the table are only initial estimates. 

Notes 

49

50 

GROUP NOTES 


Standard/ 

Interpretation 

IFRS 1 First Time Adoption of IFRS (amendment) 

IFRS 2 Share-based payment (amendment) 

IFRS 3 Business combinations 

IFRS 8 Operating segments 

IAS 1 Presentation of financial statements 

IAS 23 Borrowing costs (revised) 

IAS 27 Consolidated and individual 

financial statements acc. to IFRS 

IAS 32 Financial instruments: presentation (revised) 

IAS 39 Financial instruments: Recognition and 

Measurement – risk positions which qualify 

for hedge accounting, (amendment) 

IAS 39 Financial instruments: Recognition and 

Measurement – reclassification of 

financial assets (amendment) 

IFRIC 12 Service Concession Arrangements 

IFRIC 13 Customer Loyalty Programmes 

IFRIC 15 Agreements for the 

Construction of Real Estate 

IFRIC 16 Hedges of a Net Investment 

in a Foreign Operation 

IFRIC 17 Distribution of 

Non-Cash Assets to Owners 

IFRIC 18 Transfers of Assets from Customers 

FN Applicable to Planned application 

financial years as of for the first time as of 

1, 3 1st January 2009 1st January 2009 

1 1st January 2009 1st January 2009 

1, 3 1st July 2009 1st January 2010 




1, 2, 3 1st July 2009 1st January 2010 



1, 3 1st July 2008 1st January 2009 

1, 3 1st January 2008 1st January 2009 

1 1st July 2008 1st January 2009 


1, 3 1st October 2008 1st January 2009 



FN 

1 No noteworthy effects on the consolidated financial statements are anticipated. 

2 Additional / Modified information in particular is anticipated in the notes to the consolidated annual financial statements. 

3 Statements by the IASB / IFRC have not yet been adopted by the EU at the accounting date.

GROUP NOTES 


Assets and debts acquired 

Goodwill 

Other long-term assets 

Short-term assets 

Purchase price 

Net liquidity assumed 

Net outflow from acquisition 

Apart from the balance sheet and income statement, a cash flow statement and equity 

statement are shown. 

In order to improve presentation, various items in the group balance sheet and group 

income statement are combined. These items are accordingly broken down and explained 

in the notes. The income statement was prepared in accordance with the cost of sales 

method. 

Companies included in the consolidation and consolidation 

The consolidated financial statements include the companies under the control of SPSH. 

The financial statements of the companies included in the consolidated financial statements 

are prepared in accordance with uniform balance sheet recognition and valuation 

methods at the same balance sheet date as the financial statements of the parent company. 

For the first time, the newly formed resp. acquired companies were consolidated. 

SPSH acquired 100% of the shares in TOO “emc Kazakhstan” LLP, Kyzylorda / Kazakhstan 

(emc KZ) by sales contract of 31.03.2008 (acquisition date) for a purchase price including 

ancillary acquisition costs totalling KEUR 25 which was paid in cash. 

The purchase price is allocated to the acquired assets and debts as follows. 

Book value prior Book value after 

to acquisition acquisition 

0 169 

7 7 

219 219 

0 25 

0 -120 

The goodwill of KEUR 169 remaining after allocation of the purchase price is the balance 

of the acquisition costs of KEUR 25 and the market value of the net assets acquired of 

KEUR 144. Goodwill is essentially the customerspecific know-how and customer relations 

of emc KZ. 

The acquired company, which operates in the spare parts and service business for gas turbines, 

contributed KEUR 225 to the result of sales revenues amounting to KEUR 2,265. 

145 

Notes 

51

52 

GROUP NOTES 


Name 

Standardkessel Power Systems Holding GmbH, 

Duisburg 

Standardkessel Baumgarte Holding GmbH, 

Duisburg 

Standardkessel GmbH, Duisburg 

Baumgarte Boiler Systems GmbH, Bielefeld 


Service Holding GmbH, Oberhausen 


Service GmbH, Oberhausen 

emc Germany GmbH, Oberhausen 

TOO "emc Kazakhstan" LLP, 

Kyzylorda/Kasachstan 

Standardkessel Baumgarte Contracting 

GmbH, Duisburg 

Capital was consolidated according to the purchase method by offsetting acquisition 

costs against net assets valued pro rata which are attributable to the parent company at 

the time of acquisition. Intangible assets were also recognised at their market value which 

were not hitherto reported in the individual financial statements of the acquired companies. 

Intangible assets identified in the acquisition of the company were then recognised 

separately at the time of acquisition if the requirements of IAS 38 for activating an immaterial 

asset were met. Furthermore, carriedforward losses recognised for tax purposes 

were activated as a deferred tax claim. The valuation of the assets recognised at the time 

of acquisition is adjusted within twelve months of acquisition for the benefit or charge 

of the assets. 

The following table gives an overview of the companies with their individual financial 

statements included in the consolidated financial statements: 

Equity as of Group 

31.12.2008 share in 

KEUR % 

6,191 100 

10,171 100 

10,019 100 

15,220 100 

1,670 100 

109 100 

-265 100 

81 100 

25 100

GROUP NOTES 


Licences 

CAD system library 

Calculation programmes 

Sales archive 

Engineering archive 

The intra-group transactions as well as expenditure, income and intercompany profits, 

accounts receivable and payable between the individual companies were eliminated. 

Goodwill 

Goodwill is the difference between acquisition costs and the market value of assets and 

debts acquired within the scope of an acquisition on the assets side. Goodwill is shown in 

the assets side of the balance sheet and is not subject to scheduled depreciation but an 

impairment test is carried out at least once a year to determine the need for any unscheduled 

depreciation. There was no need for devaluation in 2008. 


Depreciable intangible assets acquired against payment are reported at acquisition cost 

less scheduled depreciation on a straight-line basis (useful life three to ten years). 

3 to 5 years 

5 years 

10 years 

10 years 

10 years 

Impairment is assessed according to occurrence by comparing the book value and the 

realisable amount. The realisable amount corresponds to the higher of the two values 

from the market value less the sales costs and cash value of the future attributable cash 

flow due to continued use of the asset. If the book value is higher than the realisable 

amount, the asset is depreciated by the resulting difference (fair value). 

Research costs are treated as ongoing expense per IAS 38. Development costs are capitalised 

in accordance with IAS 38, if the conditions to do so are met. 

Notes 

53

54 

GROUP NOTES 


Buildings 

Installations on land 

Plant and machinery 

Fixtures and fittings 


Property, plant and equipment are valued according to the cost method of IAS 16 at 

cost of acquisition or production, reduced by scheduled and, where applicable, also unscheduled 

depreciation. Repair costs and interest on external borrowing are reported as 

ongoing expense. 

Scheduled depreciation is determined pro rata temporis based on expected useful life 

according to the straight-line method. Scheduled depreciations are based on the following 

useful lives established as uniform across the Group: 

20 to 50 years 

8 to 20 years 

5 to 15 years 

3 to 13 years 

Property, plant and equipment are subject to unscheduled depreciation if a decline in 

value is indicated and the realisable amount is below the cost of acquisition or production 

carried forward. A write-up is performed if the reasons for unscheduled deprecation in 

previous years are no longer applicable. Due to the amendment of § 6 II a EStG [Income 

Tax Act], low-value assets attributable to property, plant and equipment are accumulated 

in the year of their addition and deprecated as scheduled over five years. 

Long-term financial assets 

Long-term financial assets are capitalised at acquisition cost according to IAS 39 if they 

are loans and receivables. The acquisition costs of long-term low or zero-interest loans 

correspond to their cash value at the time of acquisition. They have times to maturity of 

up to five years. Other long-term financial assets are written down to the lower value as 

necessary on the balance sheet date. They are written off when they are sold or mature. 

Interests in non-consolidated subsidiaries are valued according to IAS 39 at the ascribed 

market value.

GROUP NOTES 


Inventories 

Inventories are valued at cost of acquisition or production or at the lower net sale value. 

Costs of production encompass the directly allocated costs of fabrication and the fixed 

and variable costs of material and fabrication allocated at a pro rata share. Overhead cost 

allocations are on principle determined on the basis of normal capacity. Sales costs, general 

administration costs and interest on external borrowing are not capitalised. 

Raw materials and consumables are valued at the average purchasing prices plus ancillary 

costs, less cash discounts, taking the net sales value into account. 

Other short-term assets and short-term financial assets 

Other short-term assets and short-term financial assets are recognised at cost of acquisition 

or the lower ascribed value. Apparent individual risks in accounts receivable are 

accounted for by way of individual value adjustments. Zero interest receivables with a 

time to maturity of more than 1 year are discounted. Based on experience in the past, no 

further lump sum value adjustments need to be made. Write-ups are performed when 

the reasons for an individual value adjustment made in previous years no longer exist. 

Receivables and liabilities in foreign currencies are converted at the rate on the accounting 

date. Value adjustments as a result are treated as affecting net income. 

Manufacturing orders 

Manufacturing orders are recognised using the percentage of completion method (P.O.C.). 

The percentage of completion is calculated from the share of the order costs incurred up 

to the balance sheet date in the expected total order costs (cost-to-cost method). Sales 

revenues and cost of sales are reported based on the expected order revenues and the 

expected order costs according to the percentage of completion achieved. Parts of trade 

orders valued per P.O.C. are recognised in the balance sheet as accounts receivable from 

manufacturing orders. Payments on account received for P.O.C. orders are deducted on 

an order-by-order basis up to the amount of the receivables, any excess is carried as a 

liability as payments on account received. 

Impending losses from manufacturing orders are recognised on the balance sheet as 

expense immediately i.e. at the time they are detected. Insofar as the result of a manufacturing 

order is not yet sufficiently certain, the revenue is reported only at the level of the 

order costs incurred (zero profit method). The profit portion is only realised – on a sliding 

scale based on risk classes – when completion has progressed to such a stage that order 

revenues and costs still to be incurred can be estimated reliably. 

The orders valued according to the zero profit method are reported in the income statement 

as sales revenues and manufacturing costs at the level of the costs incurred. In the 

balance sheet, these orders are recognised as accounts receivable from manufacturing 

orders. 

Notes 

55

56 

GROUP NOTES 


Provisions 

Provisions for pensions are valued in compliance with IAS 19 according to the projected 

unit credit method, taking future developments in salaries and pensions into account 

insofar as these involve defined benefit pension plans. Actuarial gains / losses are realised 

immediately. 

Other provisions are formed according to IAS 37 for all risks and contingent liabilities apparent 

on the balance sheet date, resulting from past transactions or past events where 

their amount or date of maturity is uncertain, at the amount at which they are expected 

to be incurred. Provisions with a time to maturity of more than one year are discounted. 

We set up provisions for warranties at the time the final invoice for the orders is sent to 

the customers. Provisions for warranties are set based on the warranty expense incurred 

in the past, the warranty period and the revenues associated with the warranties. In addition, 

individual provisions for warranties are formed for individual claims. Accruals for 

costs not yet invoiced and for other order-specific liabilities are valued based on expected 

payments still to be made, and for payment in kind obligations, at the production costs 

still to be incurred. 

Liabilities 

Liabilities are generally recognised for the first time in the balance sheet at the amount of 

the consideration received. Liabilities are generally recognised in subsequent periods as 

liabilities with the costs of acquisition carried forward (applying, if necessary, the effective 

interest method). Liabilities with time to maturity of over twelve months are reported at 

their cash value. Liabilities in foreign currencies are converted at the rate on the accounting 

date. 

Estimates 

When preparing the consolidated financial statements, assumptions were made and estimates 

applied which impacted on the amount and reporting of the assets and debts, 

income and expenses and contingent liabilities reported in the balance sheet. The assumptions 

and estimates essentially relate to the establishment of economic useful life 

as uniform across the Group, assumptions on the percentage of completion and the 

total costs of customer-specific manufacturing orders, the reporting of provisions in the 

balance sheet and the possibility of future tax reductions. The assumptions on which a 

respective estimate is based are clarified in the individual balance sheet items and the 

income statement. Actual values can in some cases deviate from the assumptions and 

estimates. Such deviations are taken into account as income or losses as soon as they 

become known. 


Deferred income taxes are recognised based on the balance sheet-oriented asset and 

liability method. Income taxes are deferred for temporary differences between tax and 

valuations entered in the balance sheet, for consolidation processes and for tax losses 

carried forward.

GROUP NOTES 


Deferred tax assets are only recognised insofar as the associated tax reductions are likely 

to occur. Losses carried forward are only included in the tax deferrals to the extent that, 

on the basis of the forecast results for tax purposes, taxable income is expected in the 

future which will suffice to realise the deferred income tax assets. 

Deferred income taxes are valued at the tax rate applicable on the balance sheet date. 

Changes in the tax rate are taken into account according to IAS 12 as soon as they have 

gone through legislative procedure. 

Income and expenses 

The income statement is prepared according to the cost of sales method. 

Sales are entered at the time the deliveries or services are provided and the risk has passed 

to the customer. Sales are reduced by cash discounts, customer bonuses and rebates. 

Where manufacturing orders are long-term, sales are reported according to the percentage 

of completion method (P.O.C.). For more details, please refer to the explanations on 

manufacturing orders. 

Operating expense is reported when the service is utilised, expenses for advertising and 

sales promotion and other sales-related expenses at the time they are incurred as expense. 

Interest income and expenses and other costs from external borrowing are reported 

as income or losses as accrued. 

Currency translation 

The respective transaction rates during the year are used as the basis for translating 

foreign currency amounts into euros. At the end of the year, the open foreign currency 

balances are recalculated at the accounting date rate, and currency differences are 

reported as income or losses. 

Cash flow statement 

The cash flow statement was prepared in accordance with the provisions of IAS 7. In the 

cash flow statement, the cash flows are broken down into the areas of cash flow from 

operations, cash flow from investments, and cash flow from financing activities. The indirect 

method is used to determine the cash flow from operations. 

Operating income and expense not affecting cash flow are eliminated within the cash 

flow from operations. This shows the change in liquidity as a result of the annual profit. 

Cash flow from investments contains the investments in intangible assets, property, plant 

and equipment and financial assets affecting financing as well as cash inflow from the 

retirement of intangible assets, property, plant and equipment and loans. 

Cash flow from financing activities includes the balance sheet items “Securities”, “Cash 

on hand, credit balances at banks”, and “Liabilities due to banks”. 

Notes 

57

58 

GROUP NOTES 



Gross book value as of 01.01.2008 

Cumulative depreciations 01.01.2008 

Situation on 01.01.2008 

Additions 

Retirements 

Depreciations 




Previous year 

Gross book value as of 01.06.2007 

Cumulative depreciations 01.06.2007 

Situation on 01.06.2007 

Additions 

Retirements 

Depreciations 




II. Explanations on the balance sheet 

1 Intangible assets 

Goodwill Licences, software 

similar rights 


15,079 12,629 27,708 

0 -2,366 -2,366 

15,079 10,263 25,342 

169 308 477 

0 -3 -3 

0 -2,060 -2,060 

15,248 8,508 23,756 

15,248 12,934 28,182 

0 -4,426 -4,426 

15,079 12,353 27,432 

0 -970 -970 

15,079 11,383 26,462 

0 276 276 

0 0 0 

0 -1,396 -1,396 

15,079 10,263 25,342 

15,079 12,629 27,708 

0 -2,366 -2,366

GROUP NOTES 


Licences, software and similar rights carry predefined useful lives. Scheduled depreciations 

on them amount to KEUR 2,063 (previous year KEUR 1,396) and are included in the 

functional costs, in particular in the costs of manufacturing. Residual life of the intangible 

assets included in the Purchase Price Allocation in 2007 is four to nine years. 

Goodwill of KEUR 15,248 (previous year KEUR 15,079) is shown resulting from company 

acquisitions. The difference to the previous year results from the first-time consolidation 

of TOO “emc Kazakhstan” LLP. The impairment test carried out at the balance sheet date 

did not result in any value adjustment expenditure. 

Notes 

59

60 

GROUP NOTES 






Additions 

Retirements 

Depreciations 




Previous year 




Additions 

Retirements 

Depreciations 




2 Property, plant and equipment 

Real estate Technical plant Other plant, Fixed assets 

and machinery fixtures and 

fittings 

3,176 124 3,673 6,973 

-1,879 -83 -3,004 -4,966 

1,297 41 669 2,007 

0 1 557 558 

0 -17 -76 -93 

-106 11 -212 -307 

1,191 36 938 2,165 

3,176 108 4,154 7,438 

-1,985 -72 -3,216 -5,273 

3,167 124 3,614 6,905 

-1,803 -79 -2,869 -4,751 

1,364 45 745 2,154 

9 0 172 181 

0 0 -113 -113 

-76 -4 -135 -215 

1,297 41 669 2,007 

3,176 124 3,673 6,973 

-1,879 -83 -3,004 -4,966 

The scheduled depreciations on fixed assets of KEUR 400 (previous year KEUR 215) are 

included in the functional costs, in particular in the manufacturing costs.

GROUP NOTES 


3 Long-term financial assets 

Shareholdings of KEUR 33 (previous year KEUR 9) are held in three companies which were 

not valued at equity because of their insignificance. They are valued according to IAS 39 

on principle at their ascribed market value which corresponds to the amortised costs. 

There are also long-term assets of KEUR 1,500 (previous year KEUR 500). 

Valuation is at cost of acquisition. Value adjustments were made to shareholdings and 

loans to shareholdings of KEUR 565 according to anticipated future cash flows. 

4 Deferred income tax receivables 

Deferred income taxes are formed pursuant to IAS 12 for valuation differences between 

the fiscal balance sheets of the individual companies and the consolidated financial statements. 

The tax rates for deferred income taxes within the Group are on average 31.7%. 

Temporary differences between the valuations in the IFRS consolidated financial statements 

and the respective tax valuation impact on the tax deferrals reported in the balance 

sheet as follows: 

Notes 

61

62 

GROUP NOTES 




Fixed assets 


Short-term assets 

Inventories 

Receivables and other assets 

Long-term debts 

Provisions 

Current debts 

Provisions 

Liabilities and other 

Fiscal carried-forward losses 

Sub-total 

Balance of deferred active and 

passive taxes 

Value shown in the balance sheet 

31.12.2008 31.12.2008 31.12.2007 31.12.2007 

Assets Liabilities Assets Liabilities 

2,139 2,439 2,438 3,014 

-889 -693 386 

2,278 502 

25 524 424 -221 

448 177 -47 

1,080 371 

3,669 3,391 

5,833 5,880 6,239 3,503 

-5,808 -5,808 -3,503 -3,503 

25 72 2,736 0 

Deferred taxes on carried-forward losses were shown on the assets side where it is likely 

that they can be offset against future profits. No deferred taxes were recognised for fiscal 

carried-forward losses for corporation tax and trade income tax totalling KEUR 3,025 

because their effectiveness in reducing tax was not adequately guaranteed.

GROUP NOTES 


Receivables from other taxes 

Accrual for payments relating to other periods 

Receivables not yet invoiced 

Manufacturing costs 

plus P.O.C. result 

“Zero profit” receivables not yet invoiced 

Payments on account made 

Less payments on account received 

5 Raw materials and consumables 

The total book value of raw materials and consumables reported in the balance sheet on 

the accounting date is KEUR 808 (previous year KEUR 487). 

The amount of value write-downs posted amounts to KEUR 268 (previous year KEUR 63). 

6 Current income tax receivables 

Current income tax receivables basically include receivables from the tax offices from 

interest income tax and trade income tax. 

7 Other assets 

31.12.2008 31.12.2007 

1,599 1,015 

1,692 808 

3,291 1,823 

Individual value adjustments were made on receivables from other taxes (basically foreign 

turnover taxes) of KEUR 493 (previous year KEUR 486). 

8 Accounts receivable from manufacturing orders 

31.12.2008 31.12.2007 

239,203 166,859 

21,144 4,587 

937 376 

1,513 2,665 

-259,055 -170,978 

3,742 3,509 

The items bear no interest. By accounting for appropriate reductions in value, the book 

values correspond to the market values. Deficit orders are reported in the provisions for 

other order-related obligations as anticipated losses of KEUR 0 (previous year KEUR 477). 

Notes 

63

64 

GROUP NOTES 


9 Trade accounts receivable 

Trade accounts receivable are reported at KEUR 4,693 (previous year KEUR 4,273). Shortterm 

receivables do not bear interest and are recognised at acquisition cost. Doubtful customer 

accounts are recognised at the lower recoverable amount. Accounts receivable valued 

in foreign currencies are valued at the mean rate on the balance sheet date. This results in a 

currency gain in the balance of KEUR 5 (previous year currency loss of KEUR 1). 

Completed orders finally billed to customers are reported in trade accounts receivable. 

The so-called retention money is as a rule replaced by submission of a warranty surety so 

that there are no receivables with a time to maturity of more than one year. All receivables 

amounting to KEUR 4,693 (previous year KEUR 4,273) are therefore due within one 

year. When receivables are met, they are eliminated from the accounts. The book values 

comply with the ascribed market values. 

As far as the trade accounts receivable are concerned where neither the value is reduced 

nor payment delayed, there are no indications at the accounting date that the debtors 

will not meet their payment commitments (see table following the explanations on other 

financial assets). 

Value adjustments to the trade accounts receivable of KEUR 730 (previous year KEUR 

1,554) were carried out (see table following the explanations on Other financial assets). 

10 Other financial assets 

These are loans and other receivables. 

Individual value adjustments on these amounted to KEUR 15 (previous year KEUR 0). 

Other financial assets in foreign currency with a fixed value date are valued at the forward 

exchange hedge rate on the balance sheet date. This results in a currency gain of 

KEUR 43 (previous year KEUR 0).

GROUP NOTES 


Book value 

There of neither reduced in value nor overdue 

on the accounting date 

Not adjusted in value, 

overdue in the time bands 

Overdue in less than 30 days 

Overdue between 30 and 60 days 




Overdue in more than 360 days 

Individual value adjustments 



Trade accounts Other financial 

receivable assets 

4,693 799 

3,237 654 

840 0 

229 0 

195 0 

4 0 

0 120 

188 25 

The individual value adjustments developed as follows: 

01.01.2008 Appropriation Liquidation Drawdown 31.12.2008 

1,554 15 -298 -541 730 

0 15 0 0 15 

1,554 30 -298 -541 745 

Notes 

65

66 

GROUP NOTES 


Subscribed capital 

Capital reserve 

Profit reserves 

Net income for the year 

11 Securities 

The securities are intended for short-term management of liquidity. The securities amounting 

to KEUR 7,148 (previous year KEUR 22,024) are mortgage bonds of KEUR 3,010 

(previous year KEUR 2,995) which are held for commercial purposes. They are reported in 

the balance sheet at market value. The interest rate is on average 4.544% p.a. (previous 

year 4.62% p.a.). There were price gains in the securities of KEUR 15 (previous year KEUR 

0). The trading date is decisive for reporting the regular acquisition and sale of securities. 

They are valued on the basis of market values on an active market. 

Due to the crisis in the financial markets, the price trend in the other securities (shares) of 

KEUR 4.709 is negative and led to a price loss of KEUR 571 (previous year KEUR 2) on the 

accounting date. It is assumed that the price losses are of a permanent nature given the 

current situation on the financial markets so that if the securities need to be sold, a loss 

will be realised. The loss in value of the securities allocated to the Available for Sale category 

therefore was not offset in equity without effect on net income but included in the 

financial result charged to expenditure as diminution in value according to IAS 39.67. 

Attention is drawn here to (27) Financial instruments. 

12 Cash on hand, credit balances at banks 

Of the credit balances at banks, KEUR 41,086 (previous year KEUR 31,471) were deposited 

to secure bank credit lines according to term. To provide security for the long-term 

liabilities of KEUR 14,025 (previous year KEUR 18,375) due to banks, the credit balances 

are pledged to the lead bank. 

13 Equity 

31.12.2008 31.12.2007 

28 28 

3 3 

5,000 7,329 

13,210 7,240 

18,241 14,600

GROUP NOTES 


Capital management aims to ensure adequate credit-worthiness and compliance with 

national and international criteria for project tenders through an appropriate equity ratio. 

Adequate capital in the form of equity and external borrowing is assured and made 

available to all group companies. 

Minimum requirements from investors exist as of the reporting date 31st December 2008 

in the form of the total debt service coverage und dynamic level of indebtedness covenants 

(staggered in years). The Standardkessel Baumgarte Group has complied with 

these covenants during the entire reporting period and at the balance sheet date. 

14 Subordinated shareholder loan 

The majority shareholder granted a subordinated interest-bearing loan of KEUR 2,568 

(previous year KEUR 2,286). 

15 Provisions for pensions 

The company pension plans of the companies for their employees are essentially based 

on direct, defined benefit pension commitments within the meaning of IAS 19. Length 

of service with the company and the pensionable remuneration are decisive factors when 

assessing pensions. 

These pension commitments are financed by forming provisions for pensions. Provisions 

for pensions are actuarially valued according to the projected unit credit method, taking 

into account future developments. Actuarial gains and losses are accounted for fully in 

the net income in the period they accrue. 

Realistic assumptions, valid at the balance sheet date, are used among other things for 

the imputed interest rate as well as for future salary increases with final salary pension 

commitments and for future pension adjustments. The interest component contained in 

the pension expenses is reported within interest expense. 

Information on defined benefit plans 

The companies have direct pension obligations based on individual commitments and 

a general policy. The following arrangements apply to the valuation of pension obligations 

derived from a pension plan dated 2nd January 1989 and from the general terms 

and conditions for management pensions dating back to May 1998 of a former parent 

company. 

A retirement pension is paid when the employee attains the age of 65, or on drawing a 

retirement pension from the statutory pension scheme, or when the pensionable age limit 

is brought forward. In addition, there are agreements on disability, orphans and widows 

pensions. 

A pension payable monthly is provided when the employee attains the age of 65 or is 

unable to work prior to that date. 

Notes 

67

68 

GROUP NOTES 


Accounting interest rate 

Pensions trend 

Salary trend 

Situation on 01.01. (01.06.) 

Expenditure for additional pension rights 

acquired during the financial year 

Interest expense for rights already acquired 

Actuarial 

gains / losses 

Benefits paid out 

Situation on 31.12. 

As of 31st December 2008, there is a change in the number of prospective beneficiaries 

and pensioners. 208 prospective beneficiaries (previous year 210), 115 vested pension 

rights (previous year 115) and 217 pensioners (previous year 198) are accounted for in 

the plans as of 31st December 2008. For the companies, the cash value of the pension 

obligations was determined based on the following assumptions: 

31.12.2008 31.12.2007 

5,75% 5,25% 

2,00% 1,75% 

2,00% 2,00% 

The biometric calculation is based on the mortality tables 2005G of Prof. Dr. Klaus 

Heubeck. The provisions for pensions have developed as follows over the course of the 

financial year: 

2008 2007 

7,316 7,685 

196 120 

385 205 

-180 -561 

-244 -133 

7,473 7,316

GROUP NOTES 


Cash value of future benefits from pension 

commitments (defined benefit obligation) 

Other pensions 

Expenditure for additional pension rights 

acquired during the financial year 

Interest expenses for rights already acquired 

(interest cost) 

Pension expenditure for the period 

Provisions for pensions in the balance sheet are derived as follows from the value of the 

obligations: 

31.12.2008 31.12.2007 

7,422 7,262 

51 54 

7,473 7,316 

The cash value of future benefits from pension commitments shows the actual target value 

for the valuation per IAS 19. The actuarial cash value of the future benefits earned by employees 

entitled on the valuation date to pensions or rights to future pension benefits according 

to the respective pension plan was appropriated to reserves. 

Pension expenditure for the respective period comprises the following and is reported in the 

items indicated in the income statement: 

Item in Income 

Statement 2008 2007 

23 196 120 

24 385 205 

581 325 

Of the provisions for pensions and similar obligations, KEUR 285 (previous year KEUR 191) is 

expected to fall due in the subsequent financial year. 

The obligations will be financed exclusively from provisions. 

Notes 

69

70 

GROUP NOTES 


Warranties 

Costs not yet invoiced 

Other order-specific obligations 

Obligations for and towards employees 

Other sundry accruals 

16 Other provisions 

Situation on Drawdown Appropriation Liquidation Situation on 

01.01.2008 31.12.2008 

5,741 -2,782 8,167 -1,338 9,788 

7,167 -2,643 5,727 -5,885 4,366 

The provisions for warranties cover contractual warranty obligations. The accrual for costs 

not yet invoiced relates to outstanding supplier invoices, expenditure for remedy of defects 

and other order-specific obligations. 

The obligations for and towards employees exist to cover anniversaries, redundancy payments, 

pre-retirement part-time programmes, bonuses, special remuneration, overtime 

and accumulated time, vacation and the mutual indemnity association. The long-term 

component of these provisions is discounted. There was a reduction of a discounted 

amount of KEUR 58 (previous year KEUR 15) due to the lapse of time. The discounting 

rate was increased in 2008 from 5.25% to 5.75%. This had a positive effect on the result 

of KEUR 11. 

Other sundry accruals related to numerous individual risks. 

17 Deferred income taxes 

794 -494 0 -300 0 

6,118 -4,709 4,007 -190 5,226 

1,619 -1,114 1,122 -63 1,564 

21,439 -11,742 19,023 -7,776 20,944 

Deferred income taxes amount to KEUR 72 (previous year KEUR 0) after offset against 

deferred income tax receivables of KEUR 5,808 (previous year KEUR 3,503). 

18 Long-term liabilities due to banks 

Liabilities due to banks are secured by the pledging of all shares in the companies of the 

Standardkessel Baumgarte Group, the assignment of the claims of these companies under 

insurance contracts except for car insurances and the pledging of balances which the 

group companies maintain at the leading bank.

GROUP NOTES 


Payments on account received for orders 

Trade accounts payable / 

supplier drawdown 

Personnel liabilities 

Liabilities from taxes 

Other sundry liabilities 

The acquisition loan raised to finance the purchase price has a time to maturity of seven 

years, KEUR 2,850 (previous year KEUR 2,850) thereof has a time to maturity of up to one 

year, KEUR 11,175 (previous year KEUR 11,400) thereof a time to maturity of between 

one and five years, and KEUR 0 (previous year KEUR 4,125) thereof a time to maturity of 

more than five years. The loan is valued at the repayment amount, is interest-bearing and 

repaid on a straight-line basis. 

19 Obligations from manufacturing orders 

31.12.2008 31.12.2007 

Payments on account received from P.O.C. orders are deducted on an order-by-order basis 

up to the amount of the receivable; any excess is carried as a payment on account received. 

Given the time to maturity, the book value is a reasonable approach to the ascribed 

market value. Obligations are all short-term. 

20 Other financial liabilities 

The liabilities are towards a consortium. 

Other financial liabilities are reported as short-term liabilities because they are due within 

one year. For this reason, the repayable amount corresponds to the ascribed market value. 

21 Other short-term liabilities 

80,249 59,205 

35,145 19,481 

115,394 78,686 

31.12.2008 31.12.2007 

56 115 

465 1,372 

74 73 

595 1,560 

The liabilities are valued at their repayable amount. Liabilities valued in foreign currency 

are valued at the mean rate of exchange on the balance sheet date. 

This results in a currency loss in the balance of KEUR 54 (previous year KEUR 1). 

Notes 

71

72 

GROUP NOTES 


Germany 

Other EU member states 

Other European countries 

America 

Asia 

Interest and similar income 

Interest and similar expenses 

Interest component in appropriation to 

provisions for pensions 

Interest on other provisions 

Depreciations on financial assets 

Price gains and losses for securities 

III. Explanations on the Group income statement 

22 Geographic breakdown of revenues 

01.01. – 31.12.2008 01.06. – 31.12.2007 

Sales revenues from customer-specific manufacturing orders according to P.O.C. amount to 

KEUR 194,702 (previous year KEUR 76,300). Sales revenues relate mainly to the construction 

of new boiler systems. 

23 Other operating income and expense 

All other sundry operating income and expense are offset within the functional costs. 

The result includes exchange losses of KEUR 6 (previous year KEUR 2). 

24 Financial result 

123,883 37,003 

69,701 33,540 

3,159 2,987 

162 206 

3,051 2,671 

199,956 76,407 

01.01. – 31.12.2008 01.06. – 31.12.2007 

4,841 2,245 

-1,523 -941 

-385 -205 

58 15 

-565 0 

-556 2 

1,870 1,116

GROUP NOTES 


Current income taxes 


Result before income taxes 

Expected income tax expenses at an average 

group income tax rate of 31.7% 

(previous year 40.1%) 

Fiscal application of carried-forward losses 

Addition to fiscal carried-forward losses 

Temporary difference goodwill 

Effects of adjustment of deferred taxes due to 

change in tax rate to 31.7% 

Valuation differences between fiscal balance 

sheet and IFRS balance sheet 

Losses without fiscal effect 

Additional payments/refunds 

of taxes previous years 

Other fiscal effects 

Recognised income tax expenses 

25 Taxes on income 

01.01. – 31.12.2008 01.06. – 31.12.2007 

-331 -3,285 

-2,782 444 

-3,113 -2,841 

Reconciliation of expected and actual income tax expenses 

The table below shows a reconciliation statement of expected and actual income tax 

expenses: 

01.01. – 31.12.2008 01.06. – 31.12.2007 

7,908 10,318 

-2,507 -4,138 

0 581 

278 2,941 

0 -174 

0 -1,176 

0 -887 

-735 0 

-147 0 

-2 12 

-3,113 -2,841 

Notes 

73

74 

GROUP NOTES 


Cost of raw materials and consumables 

for goods for resale 

Cost of purchased services 

Salaries and wages 

Social security, 

pension and other benefits 

The result before income taxes is multiplied by the average group income tax rate of 

31.7% which consists of trade income tax (15.8%), corporate tax (15.0%) and the solidarity 

surcharge (5.5% of the corporation tax). 

Fiscal unlimited carried-forward losses exist for corporation tax (KEUR 24,888) and trade 

income tax (KEUR 1,299). There of KEUR 22,646 were taken into account for corporation 

tax and KEUR 516 for trade income tax. A further volume of carried-forward loss of KEUR 

2,242 (corporation tax) and KEUR 783 (trade income tax) were not taken into account as 

application cannot be expected within the planning period. 

26 Other information on the income statement 

Cost of materials 

01.01. – 31.12.2008 01.06. – 31.12.2007 

Personnel expenses 

-1,440 -1,018 

-147,192 -51,762 

-148,632 -52,780 

01.01. – 31.12.2008 01.06. – 31.12.2007 

-20,677 -11,980 

-3,082 -1,136 

-23,759 -13,116 

Expenses for retirement pensions amount to KEUR 196 (previous year KEUR 120). They do 

not include the interest component in the appropriation to the provisions for pensions of 

KEUR 385 (previous year KEUR 205). This is reported in the financial result. 

Average headcount for the financial year 

The average number of employees in the reporting period was 265 (previous year 215).

GROUP NOTES 


Assets 

Valuation at acquisition cost 


Accounts receivable from manufacturing orders 



Cash on hand, credit balances at banks 

Valuation at fair value 

Shareholdings 

Securities 

IV. Other information 

27 Other information on financial instruments 

Financial instruments at the balance sheet date comprise the following: 

Valuation 31.12.2008 31.12.2008 31.12.2007 31.12.2007 

category Book value Ascribed Book value Ascribed 

acc. to IAS 39 market value market value 

L&R 1,500 1,500 500 500 

L&R 3,742 3,742 3,509 3,509 

L&R 4,693 4,693 4,273 4,273 

L&R 799 799 520 520 

L&R 134,246 134,246 82,729 82,729 

144,980 144,980 91,531 91,531 

AfS 33 33 9 9 

AfS 7,148 7,148 22,023 22,023 

7,181 7,181 22,032 22,032 

Notes 

75

76 

GROUP NOTES 


Liabilities 

Valuation at acquisition cost 


due to banks 

Obligations from manufacturing orders 


According to valuation categories 

Loans and receivables (L&R) 

Available for sale (AfS) 

Financial liabilities at amortised costs (FLaC) 

Valuation 31.12.2008 31.12.2008 31.12.2007 31.12.2007 

category Book value Ascribed Book value Ascribed 

acc. to IAS 39 market value market value 

FLaC 14,025 14,025 18,375 18,375 

FLaC 115,394 115,394 78,686 78,686 

FLaC 5,546 5,546 0 0 

134,965 134,965 97,061 97,061 

144,980 144,980 91,531 91,531 

7,181 7,181 22,032 22,032 

134,965 134,965 97,061 97,061 

Liquid funds, trade accounts receivable and manufacturing orders and other financial 

assets have mainly short times to maturity. Their book values therefore correspond on 

the balance sheet date approximately to the ascribed market value. The ascribed market 

values of long-term financial assets correspond to the cash values of the payments 

connected therewith, taking into account the respective current market parameters. The 

market valuation of the AfS securities gave rise to expenditure of KEUR 571 (previous year 

KEUR 2) and income of KEUR 15 (previous year KEUR 0). 

Times to maturity for trade accounts payable and other financial debts are generally short; 

the values reported in the balance sheet are approximately the ascribed values. The ascribed 

values for liabilities due to banks are determined as cash values of the payments connected 

therewith, taking into account the respective current market parameters. KEUR 

41,086 (previous year KEUR 31,471) of the financial instruments were pledged as security 

for liabilities. 

The Group’s financial division provides services for the subsidiaries. It monitors and controls 

the financial risks connected with the Group’s subsidiaries through internal risk reporting 

which analyses risks in terms of scale and scope. These risks include the market 

risk with interest-induced cash flow risks, foreign currency exposure, default risk and 

liquidity risk.

GROUP NOTES 


The Group strives to minimise the impact of such risks through appropriate financial instruments. 

These include the hedging of foreign currency transactions stipulated in the 

Group guidelines, regulations on interest and default risks. Regulations on the investment 

of surplus liquidity are established in agreement with the management. Financial instruments 

are not used for speculative purposes. 

The financial division reports to the respective group management on a monthly basis. 

Market risks 

As the Group receives payments on account to finance orders, it is exposed to financial 

market risks due to fluctuations in interest rates on its cash investments. 

Existing interest rate risks are reported according to IFRS 7 in a sensitivity analysis which 

examines the effects of hypothetical changes in the market interest rates on the result 

and equity. If the market interest level for exposure on the balance sheet date had been 

100 base points higher (lower), the result would have been KEUR 978 (previous year 564) 

higher (lower), and equity KEUR 978 (previous year KEUR 564) higher (lower). 

Foreign exchange risks 

Foreign exchange risks result solely from operating activities. They are generally insignificant. 

Default risks 

The maximum default risk of the financial assets is KEUR 16,416 on the balance sheet 

date (previous year KEUR 30,833) and corresponds to the book values reported in the 

balance sheet of KEUR 17,916 (previous year KEUR 30,833) less prime securities provided 

of KEUR 1,500 (previous year KEUR 0). 

The risk of accounts receivable from customers can be classified as low given continuous 

credit assessment and a high proportion of payments on account. 

The default risk for other original financial instruments shown on the assets side is also 

considered low because contracting partners are exclusively public authorities or financial 

institutions with the best credit-worthiness. 

Individual value adjustments of financial assets are carried out if the book value of the 

financial asset is higher than the cash value of future cash flow. They are triggered by 

financial difficulties, a customer’s insolvency, breach of contract, a customer’s material 

default in payment. 

Notes 

77

78 

GROUP NOTES 


Financial liabilities 


due to banks 


Liquidity risks 

Liquidity for the Standardkessel Baumgarte Group means not only solvency in a narrower 

context but also availability of the necessary financial margin for the underlying transaction 

through adequate credit lines. To ensure financial liquidity, a liquidity re-serve is held in the 

form of liquid funds and credit lines for guarantee credits. The Group maintains credit lines 

to banks and credit insurers with a guarantee facility of KEUR 110,000 (previous year KEUR 

90,000). The following payment commitments (interest payments calculated on the basis of 

the interest rate at 31.12. and repayments) will result from the financial liabilities in subsequent 

years: 

Book value Cash flows Cash flows Cash flows 

31.12.2008 < 1 year 1–5 years > 5 years 

14,025 3,286 11,973 0 

5,546 5,546 0 0

GROUP NOTES 


28 Other financial obligations 

Other financial obligations are derived largely from tenancy agreements, operative leasing 

agreements for cars and office equipment with the following times to maturity: 

29 Related parties 

There are no related parties within the meaning of IAS 24. 

30 Company organs 

Managing directors of Standardkessel Power Systems Holding GmbH in the 2008 financial 

year were: 

Dipl.-Ing. Jörg Klaus Klasen, Dorsten 

Filip Ackerman, Beersel/Belgien 

Dipl.-Ök. Lutz Reinery, Wuppertal 

Duisburg, 11th March 2009 

The Management 

up to between more than 

1 year 1–5 years 5 years 

1,347 2,938 249 

Jörg Klaus Klasen Filip Ackerman Lutz Reinery 

Notes 

79

80 

GROUP NOTES 


Auditor's Report 

We have audited the consolidated financial statements prepared by Standardkessel Power Systems 

Holding GmbH, Duisburg, comprising the balance sheet, the income statement, statement of changes 

in equity, cash flow statement and the notes to the consolidated financial statements, together with 

the group management report for the business year from 1 st January to 31 st December 2008. The 

preparation of the consolidated financial statements and the group management report in accordance 

with IFRSs as adopted by the EU, and the additional requirements of German commercial law 

pursuant to § 315a (1) HGB are the responsibility of the parent company’s management. Our responsibility 

is to express an opinion on the consolidated financial statements and the group management 

report based on our audit. 

We conducted our audit of the consolidated financial statements in accordance with § 317 HGB 

and German generally accepted standards for the audit of financial statements promulgated by the 

Institut der Wirtschaftsprüfer (IDW). Those standards require that we plan and perform the audit 

such that misstatements materially affecting the presentation of the net assets, financial position 

and results of operations in the consolidated financial statements in accordance with the applicable 

financial reporting framework and in the group management report are detected with reasonable 

assurance. Knowledge of the business activities and the economic and legal environment of the 

Group and expectations as to possible misstatements are taken into account in the determination 

of audit procedures. The effectiveness of the accounting-related internal control system and the 

evidence supporting the disclosures in the consolidated financial statements and the group management 

report are examined primarily on a test basis within the framework of the audit. The audit 

includes assessing the annual financial statements of those entities included in consolidation, the 

determination of entities to be included in consolidation, the accounting and consolidation principles 

used and significant estimates made by management, as well as evaluating the overall presentation 

of the consolidated financial statements and the group management report. We believe that our 

audit provides a reasonable basis for our opinion. 

With the exception of the following qualification our audit has not led to any reservations: in contravention 

of §§ 315a (1) and (3), 314 (1) 6 HGB and IAS 24.16, the total remuneration earned by the 

executive board of Standardkessel Power Systems Holding GmbH is not disclosed in the notes to the 

consolidated financial statements. 

In our opinion, based on the findings of our audit, the consolidated financial statements with this 

qualification comply with the IFRSs as adopted by the EU, and the additional requirements of German 

commercial law pursuant to § 315a (1) HGB and give a true and fair view of the net assets, financial 

position and results of operations of the Group in accordance with these requirements. The group 

management report is consistent with consolidated financial statements which comply with the IFRSs 

and the additional German commercial law regulations to be applied according to § 315a (1) HGB 

and as a whole provides a suitable view of the Group’s position and suitably presents the opportunities 

and risks of future development. 

Düsseldorf, 11 th March 2009 

Warth & Klein GmbH 

Wirtschaftsprüfungsgesellschaft 

Dipl.-Kfm. Joachim Riese Dipl.-Kfm. Wolfgang Pätzold 

Wirtschaftsprüfer Wirtschaftsprüfer


Baldusstraße 13 

47138 Duisburg 

Phone: +49 (0) 203-452-0 

Fax: +49 (0) 203-452-211 

info@standardkessel.de 

www.standardkessel.de 

Baumgarte Boiler 

Systems GmbH 

Senner Straße 115 

33647 Bielefeld 

Phone: +49 (0) 521-94 06-0 

Fax: +49 (0) 521-94 06-132 

info@baumgarte.com 

www.baumgarte.com 


Service GmbH 

Duisburger Straße 375 

46049 Oberhausen 

Phone: +49 (0) 208-299 4711 

info@skg-bbs-service.de 

www.skg-bbs-service.de 


Duisburger Straße 375 

46049 Oberhausen 

Phone: +49 (0) 208-30 66 83 10 

Fax: +49 (0) 208-30 66 83 99 

office@emc.biz 

www.emc.biz 


Contracting GmbH 



Phone: +49 (0) 203 452 0 

Fax: +49 (0) 203 452 211 

info@sbcontracting.de 

www.sbcontracting.de 

Note 

81

Standardkessel Power Systems 

Holding GmbH 



Germany 

Phone: +49 (0) 203 452- 0 

Fax: +49 (0) 203 452- 935 

www.standardkessel.de 

www.baumgarte.com 

Zink & Kraemer | www.zuk.de

Standardkessel Baumgarte Annual Report 2008

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