Overall Picture of Underlying Conditions and Business Developments

• Industrialized Countries Recover Again Slowly; Strong Growth in Newly Industrializing Countries; As Expected, Sales Adjusted for Exchange Rate Effects Up Modestly
• Favorable Underlying Conditions in All Divisions; Strong Business in N ew Printing Presses; Improved Result In Line with Projections
• Optimized Capital and Financing Structure - Cancellation of Federal Government and State Guarantees

As we had expected the previous year, the world economy developed sustainably during the financial year. The print media industry was also able to overcome the major crisis in this industry - in the industrialized countries as well. Economic vigor was already strong in the newly industrializing countries at the beginning of the year. In the industrialized countries, the basic conditions for the printing industry improved steadily during the year. The cyclically sensitive Heidelberg Equipment Division benefited in particular from this.
Although risks exist that could put a stronger brake on further growth in the world economy, the Management Board continues to view conditions as being modestly favorable at the time of this report's printing.

As at: July 2011