2007 Annual Report of the ­Ravensburger AG Group

We are Ravensburger

2007 Annual Report Ravensburger AG Group Ravensburg, May 2008

Publisher: Ravensburger AG P. O. Box 18 60 88188 Ravensburg [email protected] We are Ravensburger Comparative of the Ravensburger AG Consolidated Group Organigram of the Ravensburger AG Group

1997 1998 1999 2000 2001 2002 2003* 2004* 2005* 2006 2007 Ravensburger Leisure & T€ T€ T€ T€ T€ T€ T€ T€ T€ T€ T€ Promotion Service Division GmbH Meckenbeuren near Liebenau/ Germany

sales 248,983 295,610 301.804 284,375 288,328 254,444 266,972 286,575 287,671 281,505 285,761 without consolidated sales RTV Family Entertainment AG 258,343 280,536 283,770 Ravensburger Spieleland AG Meckenbeuren near Liebenau/Germany Ravensburger AG

Results from ordinary activities 10,987 2,977 3,083 -5,216 7,952 23,234 27,562 32,173 40,885 45,623 39,993 Ravensburg/Germany Jeux Ravensburger S.A. as a percentage of sales 4.4 % 1.0 % 1.0 % -1.8 % 2.8 % 9.1 % 10.3 % 11.2 % 14.2 % 16.2 % 14.0 % Ravensburger Buchverlag Pfastatt/France Otto Maier GmbH

Ravensburg/Germany net income/(loss) for the year 7,984 1,714 -3,809 -14,498 5,424 9,589 14,884 26,271 29,075 30,883 25,838 after tax margin as a percentage of sales 3.2 % 0.6 % -1.3 % -5.1 % 1.9 % 3.8 % 5.6 % 9.2 % 10.1 % 11.0 % 9.0 % Ravensburger Ravensburger Ltd. Ravensburger Karton s.r.o. Spieleverlag GmbH Bicester/Great Britain Policka/Czech Republic  Ravensburg/Germany Cash flow** 23,215 18,323 12,579 12,118 17,900 39,100 28,900 36,700 40,200 41,400 32,000 as a percentage of sales 9.3 % 6.2 % 4.2 % 4.3 % 6.2 % 15.4 % 10.8 % 12.8 % 14.0 % 14.7 % 11.2 % Carlit + Ravensburger AG Ravensburger S.A./N.V. Würenlos/Switzerland Brussels/Belgium Balance sheet total 193,949 273,026 236,542 245,946 226,070 198,257 256,736 265,001 234,654 237,055 257,758

shareholder’s equity 55,285 53,899 47,703 25,673 31,805 34,422 57,753 83,237 97,845 121,244 131,704 Ravensburger Ravensburger B.V. as a percentage of balance sheet total 28.5 % 19.7 % 20.2 % 10.4 % 14.1 % 17.4 % 22.5 % 31.4 % 41.7 % 51.1 % 51.1 % Amersfoort/Netherlands Gesellschaft m.b.H. Vienna/Austria

number of employees (year-end) 1,730 2,012 2,020 1,834 1,700 1,409 1,396 1,448 1,438 1,407 1,485 Ravensburger Iberica S.L.U. Ravensburger Madrid/Spain Hong Kong Limited Investments in tangible fixed assets 17,046 24,641 8,980 8,580 3,334 2,763 1,952 4,739 7,891 3,282 5,812 Hong Kong/China

Ravensburger F.X. Depreciation of tangible fixed assets 11,436 15,321 14,995 11,846 15,877 8,048 7,203 6,137 6,211 6,889 6,444 Schmid USA, Inc. Ravensburger S.p.A. Newton/New Hampshire/USA Milan/Italy

* 2003–2005 consolidated financial participations RTV Family Entertainment AG included ** Operating cash flow without working capital and accruals established from 2000 in accordance with DRS 2 (German Accounting Standards No. 2)

Games, Puzzles and Arts/Crafts division

Children’s and Youth Books division

Leisure and Promotion Service division

Annual Report

Supervisory Board Managing Board 2007. The Ravensburger year in brief 4

Dr. Klaus P. Bleyer Karsten Schmidt We are Ravensburger 8 Lindau Ravensburg Chairman Spokesman Financial Statement Dorothee Hess-Maier Jörg-Viggo Müller Annual Report 44 Ravensburg Reutlingen Balance Sheet 50 Vice-Chairwoman (from April 1, 2007) Income Statement 52 Rolf Allmendinger Frank Mallet Geislingen/Steige Ravensburg (until March 31, 2007) Dr. Manfred Antoni Weinheim

Dr. Wolfram Freudenberg Stuttgart

Otto Julius Maier Ravensburg You have in your hands the 2007 an- division had a record turnover. Ravens­ (currency-adjusted + 17.5 %). In France 2007. The Ravensburger year in brief nual report in our jubilee year 2008. burger Spieleland in its 10th year also and the United Kingdom on the other 2008 is a special year for our company, saw a massive increase in turnover. hand sales were disappointing, because because Ravensburger is celebrating The Games, Puzzles and Arts/Crafts we had to ­accept falls of 7.4 % and 2.2 % its 125th anniversary. This report is division achieved good growth, partic- ­respectively. In France this could be therefore accompanied by an article ularly in view of the negative exchange traced back mainly to a drop in the which pays tribute to the story of rates and the loss of turnover after the entire­ puzzle market by a double-figure Ravensburger as the story of a special World Cup. Turnover in the Ravens­ percentage; in the United Kingdom relationship between a company, a burger Leisure and Promotion division unusually high stocks were built up in town and a family. developed according to plan and was the trade through the introduction of satisfactory. In total the turnover of the “puzzleball®” in the previous year. Only one in eight family businesses in the Ravensburger Group grew by 1.5 % The retail sales to consumers were on Germany is still owned by the family (currency-adjusted on account of the the other hand very pleasing. that founded it, which makes it even weak Swiss franc and US dollar by 2.1 %) more worth emphasising that Ravens­ from € 281.5 million in 2006 to € 285.8 The Children and Youth Books division burger has remained a family firm. The million last year. Adjusted to take into only publishes books in German and fourth generation is already actively account the special items contained in therefore concentrates on German- involved in the business. The third the previous year’s results, basically the speaking countries. It increased sales generation of the family, Otto Julius release of provisions, the profits from by 5.7 %, from € 47.6 million to € 50.3 Maier and Dorothee Hess-Maier, have operative business improved once million. This increase in sales for the succeeded in leading the firm of Ravens­ again. 7th year running is an excellent devel- burger safely and successfully during opment in view of intense competi- the recent decades of strong growth, The Games, Puzzles and Arts/Crafts tion from international bestsellers while uniting the interests and needs division had a turnover of € 230.9 mil- and anniversary editions from several of the firm with those of the family. In lion in 2007, as opposed to € 229.5 mil- competitors in 2007. the 1950s they took over the Otto lion in the previous year. This means Maier publishing company and an increase of 0.6 % (currency-ad- Ravensburger Spieleland had 355,000 brought Ravensburger to its current justed + 1.4 %). Over and above this, in visitors in 2007, the tenth year of its size. During the period of their man- 2007 we had to make up for the sales existence, which represents a 7.5 % in- agement the number of employees of € 10.7 million which we had earned crease on the previous year. This was grew from around 80 to 1,400, the in 2006 with products connected with due to a substantial increase in the turnover increased from around DM the World Cup, especially puzzles. number of season tickets sold, to the 1 million to € 300 million. On behalf of good weather between Easter and mid- all present and former employees we The biggest single market for the August and to the various activities would like to thank Otto Julius Maier Games, Puzzles and Arts/Crafts divi- connected with the 10th anniversary. and Dorothee Hess-Maier for their sion is still Germany. Here we were Raising the entrance fees by € 1 on av- achievement as entrepreneurs. able to achieve an increase in turnover erage, more visitors and an increase in of 2.6 %. Just under 60 % of the turn- the turnover per head in catering and And now our report on the past year: over is generated abroad, the strong- the shop brought a pleasing 13.8 % 2007 was a good year for Ravens­ est growth being in Spain up 27.5 %, It- ­increase in sales to € 6.3 million. burger. The Children and Youth Books aly up 8.3 % and the USA up 7.7 %

4 5 Our Event Agency, the Ravensburger particularly in the United Kingdom by particularly in view of the negative de- are the paperback of “The Wave” from Leisure and Promotion Service division 6 %, Italy by 4 % and Spain by 17 %. velopment of the European TV mar- the film by Dennis Gansel, based on showed a drop in sales compared with kets. The strategic target for sales is to the successful book by Morton Rhue, the previous year from € 2.1 million to In the Children and Youth Books divi- change from being a push sales organ- the children’s non-fiction book “The the current € 1.9 million, as a result of sion we had to give up our leading isation to being a push and pull sales GDR” by Hermann Vinke, and the a planned concentration on profitable market position for the time being, organisation, i.e. we strengthen sales boxed set “My First ­Favourite Books” turnover. despite good sales because of espe- promotion, care of the shelves etc in for children aged 2+. cially successful titles published by the retail trade. In order to be able to At this point we would like to thank all In the 2007 financial year we were able two competitors, but we are confi- work on the additional strategies we the staff of the Ravensburger Group, to improve our market position again dent that we will regain it in the course have planned, we will expand our who through their creativity and ded­ to some extent. This is shown by trade of this year. management resources. Our long- ication have ensured the success of panels which measure retail sales to standing promotion of qualified junior our company, the reputation of the the consumer and cover between 50 % In the year covered by this report we managers will also help us with this. brand and the satisfaction of our cus- and 70 % of the market. Ravensburger made important strategic decisions. tomers. Our thanks also specifically to ranks fourth in the German toy market The “Vision 2015” which was formu- Our outlook for the next financial year the works council, whose members with a market share of 6.4 %, and was lated in 2003, with quantified inter- is one of guarded optimism. The high have championed the interests of the thus able to stabilise the big increase mediate goals for the year 2008, was level of our market position and the workforce in a fair and constructive in market share of the previous year, reviewed in 2007 for the first time in long-term decline of the markets manner. But above all we would like to which had been achieved with prod- relation to our progress towards our hardly permit higher rates of growth thank our trading partners for their ucts connected with the World Cup. targets and the measures we were any longer. But we are optimistic on co-operation and their commitment In the games segment Ravensburger taking. Basically, development is going account of the 2008 programme, to Ravensburger. was able to expand its market share by according to plan, however we have which was received very well by the 0.3 percentage points, achieving the reflected the changes in our market trade. We also expect boosts in Ger- Over and above its duty to report the highest volume growth of all toy man- environment and amended our strate- man-speaking countries from various facts, this year’s annual report would ufacturers and consolidating its sec- gies. The focus is on our largest area of promotions with limited special edi- like to make the firm Ravensburger a ond-place position. In the puzzle divi- business, Games, Puzzles and Arts/ tions of games and books in connec- live experience. It would like to convey sion we are the market leaders with Crafts. In planning the programme we tion with our 125th anniversary. High- what holds a company with a long over 70 % market share but we did suf- want to build up our own innovation lights in the Games, Puzzles and Arts/ ­history together – a shared attitude fer slight losses in volume as there was management team and call in experts Crafts division are new products such which is evident in a natural feeling a slight downturn in the overall puzzle from a specialised college and from a as the “Minis®” Advent Calendar , this for quality, a personal sense of respon- market. In the baby toys sector we consultancy – as sparring partners and above all because of the success of our sibility, and an affectionate view of achieved a 12 % increase in retail sales as overseers of the process. We also first Advent Calendar, the “puzzle- the whole picture. This is what the to consumers and thus increased our plan to expand our electronics range ball®” in 2007, furthermore the heart- portraits of some of our staff – as rep- market share by almost 1 % to the cur- and use more electronic functions in shaped “puzzleball®”, pocket games to resentatives of all the staff – describe, rent 8.7 %. In the science kits segment, games. The supply chain is to change tie in with the “Wieso? Weshalb? under the self-confident but modest which is still small, the volume rose by from just handling the products to be- Warum?” books, the family board motto “We are Ravensburger”. 3.8 %, which contributed to the con- ing an integral service provider for the game “The Name of the Rose” and a solidation of our ranking of third in the range and for sales. game based on garbled proverbs in The Managing Board market. In the rest of ­Europe the the “Games and Fun” range, plus a re- Games, Puzzles and Arts/Crafts divi- In the field of marketing, we want to launch of the “Mandala-Designer®” sion increased its sales to the consumer, open up new ways of communicating, product range. Important new books

6 7 Eight of our staff members, from different sections of the company, tell us about their jobs, about the Ravensburger spirit and about their pride in working for the blue triangle. And they give us an insight into the role played by Ravensburger in their home lives: playing games, reading stories, doing puzzles and generally sharing laughter and discovery.

There is no nicer way for the people in our company to express the fact that their heart is in what they do. Or even better: what they so enthusiastically are. We are Ravensburger

8 9 Here’s why!

She is passionate about her job as editor of “Wieso? Weshalb? Warum?”. Since the birth of her daughter, Caroline Jacobi’s workload in the publishing house has got smaller, but her enthusiasm is even greater. Because Nele shows her in her childish way that the books are really well loved: at seven in the morning she comes to her mother with her favourite volume of “Wieso? Weshalb? Warum?”

Why Ravensburger books are makes the difference. 80 % of the daughter she has been working half- ­successful books are original creations: a theme days. But wholeheartedly. is suggested, a concept is drafted, The main reason is simple: because suitable partners for the illustrations Why Ravensburger is on a child’s Ravensburger books see things through and the text are sought and then a wavelength the eyes of their target group. This ap- new book is developed in close co-op- plies to the series with the three chil- eration. Ravensburger has its own The children’s book series “Wieso? dren’s questions as it does to all the large editorial team. Including in- Weshalb? Warum?” has been on the other Ravensburger books; they do house prepress right up to hand-over market since 1998 and is one of the subject matter justice and enter to a printer and bookbinder. And Ravens­burger’s most important prod- into each stage of development and where do the ideas come from? From uct brands and the most successful age group with subtle differentiation. intensive consideration of the target series of children’s books in Germany. In the subject matter, the text and group, from permanent contact with In 10 years more than 12 million copies the illustrations. In cardboard picture illustrators and authors, from conver- have been sold. “Wieso? Weshalb? books for encouraging language ac- sations and looking at books together Warum?” is available in the form of quisition, for example, a clear realistic in crèches, nursery schools and with books for children from the age of 4, style of illustration is used, which our own children. From looking at text as a Junior series from age 2, and as makes a cup recognisable as a cup, so books on education and beyond the activity boxes, painting books, games, that it can be named. In this way boundaries of the industry. In short, science kits and puzzles. What makes books are created which interest, de- from editors such as Caroline Jacobi. the series so special is that it gives light and stimulate children. She came to the Ravensburger pub- children detailed answers, appropri- lishing house in 2002 with the best ate to their age, to questions on many Why there is a blank page at the qualifications: a degree in German, topics, and offers fascinating insights, ­beginning studies at the Institute for Research detailed illustrations and interactive into Children’s and Young People’s effects. But what interests a two-year- A Ravensburger book is not just a book Books, spells in the theatre, in book- old? What do five-year-olds want to with a blue triangle in the lower right- selling and as an editor. From 2004 know? Finding that out is the first hand corner. It’s a Ravensburger book she headed up the newly-founded step towards a new “Wieso? Weshalb? through and through. From the first edi­torial team of “Wieso? Weshalb? Warum?” book. Typical children’s ques- idea to the production. That’s what Warum?”. Since the birth of her tions on the subject of space travel:

10 11 How do spacemen eat? Where do they completed book,” Caroline Jacobi ex- do a wee? What does their toilet look plains, “I thought: Wow! It’s just like in like? Doesn’t everything fly up in the the book!” If you can say that, then the air? Such questions are important book is really good. stimuli for the conception of a book and for the research among experts in Lots of flaps, lots behind them the corresponding subject. There can easily be a year and a half between In “Wieso? Weshalb? Warum?” books the first idea for a book and its publi- the illustrations are very subtly differ- cation. In order to attain the high entiated and very detailed. Another quality demanded by Ravensburger, reason why children love the books is sketches and texts are discussed at that every time they look at them they every stage and checked thoroughly. discover something new. The famous Are the contents and the pictures fac- flaps to look behind, which have be- tually correct, are they presented in a come a trademark of the “Wieso? Wes­ way appropriate to the age group? halb? Warum?” books, make that Sometimes several stages are neces- especially clear. And rightly so! They sary before an ideal result is obtained. make sequences of events and pro- cesses understandable even to chil- Really immersing yourself in a topic dren who can’t read, by means of pictures. Unlike many comparable “Cars, cowboys, forest, Stone Age, products on the market, the “Wieso? circus, zoo...”, says Caroline Jacobi, “it Weshalb? Warum?” books have illus- makes no difference what subject trations on the back of the flaps, which we develop for a “Wieso? Weshalb? show a view of the next level, explain Warum?” book, we get completely a connection, or continue a story. Es- involved in the topic. We sift through pecially in the Junior series of “Wieso? the relevant specialist literature but Wes­halb? Warum?” the little ones sometimes we also do research on the learn a great deal from the flaps. Be- spot, get the experts to explain every- cause – as tests have also shown – chil- thing to us until we are experts too. dren who can’t yet read occupy Until we really grasp the subject, so themselves for hours alone with the that we can compress the essential books, over and over again, because facts and convert them into a form the flaps take over the explanatory that a child can understand. Until we function. The Junior series tries to cap- have a feeling for the subject as well as ture virtually all the information or the factual knowledge, a feeling that knowledge that needs to be conveyed is closer to the crucial details and in the picture. “And the children thank ­nuances, more authentic and more us in their own way, they simply love recognisable for children.” For the new the books,” says Caroline Jacobi. Inci- circus book, for example, research was dentally, the books are not only loved done at a big circus and at various by children. Mothers are always telling small circuses. For “All about Cars” the us that they have only now under- illustrator and the author went to VW stood how a 4-stroke engine works. Or and were shown round the works. It’s teachers praise specifically the clear, only by doing this kind of research that vivid and easily understood explana- you hear, see and discover the things tions. That is why Ravensburger so en- that bring a book to life. The detail for joys developing “Wieso? Weshalb? example that someone rides through Warum?” books on constantly new the workshop on a bike. “And when I topics. Caroline Jacobi went through the factory with the Book Editor

12 13 Search games

He has the job that people ask Ravensburger the most questions about: how is a game created? In a systematic process consisting of a search list, author briefing and defined steps in-house. The games developer today is an interface manager. Lothar Hemme, games editor. And a proud Ravensburger for the second time.

Market analyses and search lists Interaction with authors have been pre-selected by an external games agency. As a result of this pro- As a games editor Lothar Hemme has Lothar Hemme approaches profes- cedure, which includes a test fee, the the job of making games out of ideas. sional game authors with search cri- number of submissions has declined He picks up an idea suggested to him teria that are deliberately loosely for- to about 500 a year. The quality of by a systematic search process at mulated or he sifts through ideas for the suggestions, as regards their suit- Ravensburger and takes it step by step games that have come from them in ability for the Ravensburger games through a fixed development process. recent months. Ravensburger works ­division and their originality, has how- The process begins with an annual re- closely with the best authors all over ever noticeably improved. Around 30 view of the countries in which Ravens­ the world. Depending on the guide- to 50 % of the suggestions are pre- burger is active. Ravensburger’s con­ lines, a briefing may be with one par- sented to the editorial staff and tribution to the games market, our ticular author or several, in accord- placed on the shortlist for possible relation to the competition and the ance with the specialities and personal production. The Ravensburger web- most important movements of the strengths of the individual authors. site provides people interested in market in the various countries are However, it is the idea for the game, sending in their ideas with all the nec- analysed. Based on these individual the unique game mechanism and the essary information on the submission analyses, a general analysis is under- question of which sphere the idea can and selection procedure. taken and via several intermediate be transferred to, that sets the devel- steps a search list is made. The key opment process in motion. The author Step by step to a new game data of such a list are for example then devises the game in continual the kind of game, the target group, collaboration with the editorial staff. Lothar Hemme co-ordinates the fur- the price and the topic. Here is an ex- ther development of a new game with ample: an educational game, a certain Open to suggestions for games the Design and Product Development price, target group 5 to 9-year-olds, departments; this is where the board, topic: starting English. Or, a three- It is hardly surprising that a well-known the pieces and the packaging are cre- dimensional children’s game with publisher of games such as Ravens­ ated. The editor works on suggestions ­surprise effects. Or, a family game burger receives many unsolicited sug- for the title and composes the instruc- about money. gestions for games. Since 2004 these tions for playing the game. After nu-

14 15 merous trial rounds, the game is read the written instructions. But Hemme. The spectrum ranges from of products for children, which fitted improved, refined, made more attrac- these are still important. And the very simple games to games which in well with that phase of his life, tive, until it is ready to go into produc- question remains relevant: what is ­require a certain level of tactical and when he was a young father. In 1991 tion. Finally, measures for marketing the best way to tell people how to strategic skill, and demand some in- he moved to a publishing house in and communication and sales promo- play the game? As simply as possible tellectual effort in order to be enjoyed Hamburg, but he returned to Ravens­ tion get under way to give the new and in the degree of detail a good by those taking part. burger in the spring of 1996. Since game a good start in the market. game deserves. then he has been deeply involved in the New developments from “memory®” field of board games. He has never de- The future of games instructions The editor as guardian of the brand to electronics fined himself in terms of a job title, he stresses. “It was always the content This has been a topic ever since games All new ideas and games in the mak- Lothar Hemme is also responsible for that interested me more.” What is the have been produced: how can one ing have to face the question of themed games such as “Think®”, special attraction of Ravensburger convey the charm of a new game to whether they are in keeping with “Spiel & Vergnügen” and “memory®”. for Lothar Hemme? “This feeling, this the customer? How can one present Ravensburger’s image. In this respect His guardianship of the top brand in special spirit, which was immediately complex rules in such a way that they the editors are guardians of the brand, games, with its increasing familiarity perceptible again even after five years’ will be read? Ravensburger takes such and throw out certain topics, mecha- abroad, is twofold: he takes action if absence.” Actually, he had expected questions very seriously. Lothar nisms and types of game. As a matter the protected brand name is used ille- the company to have changed more, if Hemme describes the company’s co- of principle nothing is accepted which gally and, together with the product only because the games publishing operation with experts in the psychol- glorifies violence. This principle is even management department, he sets the ­division had moved in 1992 from a ogy of perception, who have studied more important now that violence is parameters for the expansion of the medieval house to a new building bridging texts. But it must be borne in ever more present, because of the in- ”memory®“ brand. Apart from that with modern architecture. “But the mind that habits of perception are creasing influence of the media and Lothar Hemme is concerned with stra- new walls breathed the same spirit.” changing as a result of modern media especially of computer games, and tegic considerations in respect of new and formats, such as MTV editing, for the threshold of tolerance in society is markets and opportunities for devel- example. There have been attempts lower. Other taboo topics besides vio- opment for Ravensburger games. Also to teach the rules by means of a DVD, lence are sex and drugs, whereby al- on the agenda is the integration of with the new game Arcadia. The ­visual cohol and cigarettes are included electronics into games, in order to medium is suitable as an additional among drugs. The list of taboos is bal- open up new product areas. encouragement and an emotional in- anced by a positive list. “We want to troduction, says Lothar Hemme: it can entertain people with our games but A Ravensburger twice over put us in the mood, it can give us a the entertainment is not meant to be basic understanding of the game and bland, though this is perceived very As an editor from 1984 onwards, Lothar Hemme perhaps increase our willingness to differently by consumers”, says Lothar Lothar Hemme was mainly in charge Editor Board games

16 17 Globetrotting buyer

Buying is regarded more and more as an interim quality control and therefore has increasing responsibility. As a buyer, Bettina Petry travels in the world of ­materials. With typical Ravensburger far-sightedness.

A buyer for the love of it her expeditions through the world well as around 98 per cent of the small of materials Bettina Petry discovers wooden pieces – barricades for the She came to Ravensburger as a trainee, something that she can pass on as a game “Malefiz”, cones, trees etc; the went on to do formal business suggestion to the editorial staff. remaining 2 per cent come from Europe. training, obtained a further qualifica- Also “made in Germany” are felt, “Puz- tion as a buyer and materials manager Top of the shopping list: zle Conserver”, handicraft glue, labels, and is now Purchasing Manager. It is Made in Germany textile cords, modelling clay, candle only natural that her business card is wax and much more. “Seven of my top in two languages. What Bettina Petry Bettina Petry is responsible for pro- suppliers, measured by turnover, are finds so marvellous about her job is curing materials and articles for the in Germany”, says Bettina Petry and, the contact with other people, other production department at Ravens­ “As a matter of principle we try to get cultures, other languages. She has burger. A large proportion of the materials which contain ‘critical’ sub- been with Ravensburger for 23 years Ravensburger articles are sourced in- stances and materials that come in and is passionately involved. The house from the factories in Ravens­ contact with the skin or the mouth reason she finds purchasing so ex- burg and Poliˇcka in the Czech Repub- from Germany. Then we feel safer, citing is that it is so varied, bringing lic. As far as goods from elsewhere are ­because of the quality standards.” new challenges every day. Purchasing concerned, Ravensburger buys in Ger- means guiding and managing pro- many or Europe if possible, the nearer Desktop business trips to the Far East cesses, organising and co-ordinating the better. “Some of our suppliers”, projects, negotiating contracts, ad- says Bettina Petry, “are within a radius Materials and products that require vising colleagues, solving problems of 4 to 200 km.” That means environ- intensive work by hand are purchased and much more besides. What she mentally friendly, short transport in the Far East. Though only a fraction likes is the element of strategy in pur- routes and shorter lead times. More­ of the total materials purchased, this chasing – the research into the pur- over, being nearby means easier com- claims the largest part of Bettina chasing market, looking out for munication and more insight into the ­Petry’s attention and working hours. alternative suppliers and new mate- production process. For example, Whenever something needs to be rials, on her own doorstep and all over Ravensburger obtains all kinds of elaborately sewn, ready-made, glued the globe. It can easily happen that on cards for its games in Germany, as or assembled, Ravensburger works

18 19 with suppliers in the Far East. Bettina some variety into the “ministeps®” And of course, the price is supposed to Ravensburger quality is durability,” was found that the chrome content of Petry can call on a number of tried range, however, the fabrics are com- remain within limits, in spite of special says Bettina Petry. “We try to make the scissors was way above the per- and tested suppliers there and she bined in different ways for the char- models and sometimes small orders. the articles aesthetically attractive, mitted limit for children’s toys. “We also has the support of the Ravens­ acters’ clothes. Safety remains the we want a game to still be intact and looked around for alternatives, tested burger office in Hong Kong. Top pri- most important requirement for Ravensburger purchasing philosophy: look good after ten years.” That may numerous pairs of scissors – with the ority is the safety of the materials and ­products for small children from 0 to quality before price not be apparent when you buy it, but same result: excessive chrome con- products purchased. So all suppliers 3. As Bettina Petry explains, this is after a certain time it is. “I think it tent,” reports Bettina Petry. “The at- are audited every year to check that why, in addition to the strict routine At Ravensburger quality is top priority. takes a little while before one recog- tempt to have scissors made which they are upholding the quality criteria process of ensuring safety levels, That has always been the case, has ac- nises the real quality.” It‘s remarkable were chemically harmless proved to and they are obliged by contract to Ravens­burger also has the whole quired new force following the increas­ really that the Purchasing Manager be too expensive, because of the dif- ­inform the buyer in advance of any “ministeps®” range tested once a year ing pressure on prices and is regarded should say that. After all, she is right at ferent demands of the market and the change in the material or construc- by a second independent test insti- as set in stone at Ravens­burger. “We the other end of the scale, so to speak, relatively small number we wanted. In tion. The co-operation and the work tute in specially prescribed trials and have internalised the quality stand- selecting the materials, before they the end we resorted to an unusual run so smoothly now that a great deal individual tests. ard,” says Bettina Petry. The subject is are turned into a product. The Ravens­ measure; the blades of the scissors can be done from the desk, by tele- omnipresent as a demand and as a burger attitude to quality could hardly were gilded, the danger of chrome es- phone and e-mail. Online shopping on Needed during product development process. At the same time, ever stricter be more convincingly expressed. Or caping was neutralised, and so the a grand scale, you might say. But EU regulations are being introduced. more modestly. safety requirements were fulfilled.” when it’s a matter of new and com- The earlier Purchasing gets involved in What does that mean for purchasing? Science experiment sets also contain plex projects, Bettina Petry does fly the development of new projects and The challenge of trying to reconcile Safety is worth a fortune objects which are not originally man- direct to China and meet her business products, the more efficiently it can the quality and safety standard on the ufactured for play. So sandpaper, partners on the spot. advise. At an early stage Bettina Petry one hand with the downward pres- Purchasing is confronted with special which is found in “ScienceX® Elektri­ can point out that a certain approach sure on prices on the other is becom- challenges when materials and ob- zität” for example, must be free of Major safety precautions with is not technically or financially feasi- ing greater all the time. Nevertheless, jects are used which are not specifi- heavy metals, in other words chemi- “ministeps®” ble, she can draw attention to possible in principle it is still quality before cally intended or manufactured for cally harmless for children. In her problems and introduce alternatives. price. Once the quality is assured, one use in games. Because everything search for suitable sandpaper Bettina In the toddler sector, up to 3 years old, This saves a lot of work later on. If tries to acquire that quality at the that is found in the box with a game Petry struck it lucky in Germany, inci- materials are a particularly sensitive Ravensburger also wants to distin- most reasonable price possible. must satisfy the safety standards of dentally. subject. To guarantee the greatest guish itself from its competitors by games in general. And the quality and possible safety, Ravensburger has developing new products completely Quality is durability safety criteria of Ravensburger in par- been working for many years with one independently, this means that Pur- ticular. A few years ago on the list of main supplier in China for the produc- chasing cannot fall back on standard Leaving aside the subject of safety for contents for a new children’s craft tion of plush articles and concentrates parts but “must re-invent the wheel the moment: how does one recognise game there was a pair of scissors. And Bettina Petry on proven fabrics. In order to bring again and again” with the suppliers. Ravensburger quality in general? “I think in the material test before ordering it Purchasing Manager

20 21 It’s good when everything fits together

She has always liked doing puzzles, since she was a child. So it seemed a good idea to work for Ravensburger. After an apprenticeship as a packaging mechanic she worked in puzzle production and in central purchasing. Now she is an ­assistant in the quality control department. She enjoys the fruits of her labours herself, when she does puzzles after work. Sabrina Schramm has been at ­Ravensburger for 4 years. But really for much longer.

Quality is a puzzle made of many pieces Feel, appearance, fit in order to recognise differences and clarify the quality of their own in the Quality is an expectation, quality is a How does quality reveal itself for the context of the current competition. promise, quality is work. Work that has enthusiastic puzzler Sabrina Schramm? After all, the quality of Ravensburger to be done anew every day. Even The answer comes promptly as she products is particularly in the spot- though the quality of the puzzles is points to a completed puzzle on the light because of their comparatively defined down to the smallest detail at table: “The perfect fit, the way the high price. Sabrina Schramm describes Ravensburger, what counts in the end pieces combine is absolutely sensa- another interesting special job: for a is the result: the way the customer ex- tional. They can be fitted into each while she did puzzles produced by her periences the quality. The most pleas- other wonderfully.” Puzzle quality is own company – Ravensburger puzzles ing recognition for the Ravensburger also evident in the feel of the pieces in since 1970, one from each year. The puzzle-makers comes from puzzle your hand, in the feeling you have as aim of the exercise was to recognise fans. As the leading seller of puzzles in you are doing the puzzle. Sabrina differences – from the box to the pic- Europe, Ravensburger knows how im- Schramm holds up a piece and points ture to the shape of the pieces – and as portant each individual piece is in the to the smooth edges, the clean cut. it were trace the development of the complete work of art that is a puzzle. She adds, “Perfect fit is also shown in quality. From the cardboard to the picture and the fact that you know that each piece the printing to the punched out pieces. only fits in just one place. If it doesn’t Made by hand to begin with Yes, even to the service of replacing slot in easily, downright smoothly, it’s lost pieces. Ravens­burger knows what not in the right place.” The sensational fit, asS abrina Schramm puzzle fans want: the more directly a proudly calls it, is the result of the ef- picture invites you to daydream your Keeping track by doing puzzles fort that goes into making the stamp- way into it, the greater the variety in ing tools. Ravensburger does not use the shape of the pieces, the more per- Keeping an eye on the market and prefabricated punched lines but fectly the pieces fit into each other – thoroughly researching the products makes the cutting dies itself. In their the greater the pleasure and the relax- of the competition is part of working own department employees produce ation. Ravens­burger works con­tinu­ on the quality of your own puzzles. A the tools by hand with a trained eye, ously to perfect each individual aspect nice job for Sabrina Schramm. On be- sensitive fingers and great care. The of puzzle quality, simply to offer half of the company she regularly does tools are made out of razor sharp steel ­premium puzzles. puzzles made by other manufacturers, bands and bent by hand with special

22 23 pliers according to a hand-drawn pat- ties. Puzzle fans notice the difference The machine is fully automatic – on ered did not satisfy Ravensburger tern. The result of this complicated at once. Besides the right consistency one side a sheet of paper with a pic- standards there had to be negotia- handiwork: in a 1000-piece puzzle no of the material, the way the pieces are ture on it is inserted, on the other side tions over returning it and arranging two pieces are alike. The great variety cut also contributes to the “soft click” a complete bag of 1000 pieces comes a new delivery as soon as possible. of shapes ensures that a piece only fits experience. The cut must strike the out. The bags are regularly checked, to Delivery dates and production dates exactly in one place, one tab only fits right balance between the pieces feel- see whether the control number, had to be co-ordinated. “Here I learned in one groove. Variety in shape and ing good in your hand and the picture which makes it possible to trace the about the other side of our quality,” perfect fit – a great deal is invested in lying flat and steady on the table. In production from the date to the per- says Sabrina Schramm, “an important these two excellent features of Ravens­ order to make the pieces lie pleasantly son at the machine to the tools, is experience.” burger puzzles: around 170 hours’ work in the hand and feel good, the upper complete and whether the bag is cor- are needed to make the stamping surfaces are slightly rounded, the rectly sealed. If a bag could come open Doing puzzles and an eye for quality tools for one 1000-piece puzzle. If puz- edges soft. But they must not be too easily, pieces could get lost. Then the zles are produced in three shifts dur- rounded, otherwise the picture looks contents are examined: do the pieces Has doing puzzles changed for Sabrina ing the high season, a stamping tool cut up and its overall effect is de- look good, are there pieces still stuck Schramm, since she has found out is worn out after about two weeks. stroyed. What is the correct depth for together, with ragged edges, creases what complicated things puzzles are The department making stamping the punching contours? For puzzle or other noticeable features? If any of and how much expertise, how many tools never runs out of work. fans, a completed puzzle should al- the strict standards of the quality reg- trials, how much co-ordination is ways be recognisable as a puzzle, not ulations are not met, the machine is needed in order to be able to offer pre- On a knife edge look smooth like a poster. That’s why stopped and corrections are made. mium quality? “Yes,” she says. “There is the cutting contour mustn’t be too still relaxation, there is still a challenge Puzzle quality is also a question of the fine or too deep. At the interface between suppliers and a sense of achievement in seeing perfect cardboard. The structure of and production how all the pieces fit together and the the fibres and the consistency of the Checking the pieces during production picture appears bit by bit. But at the cardboard contribute to a great extent The next stage in Sabrina Schramm’s same time it’s quite different now.” to the way the pieces softly click to- Sabrina Schramm knows puzzle pro- puzzle career at Ravensburger was Before, she was pleased about each gether. The crucial thing is the right duction like the back of her hand, after 6 months in Central Purchasing. Here connecting piece, because it contrib- balance between elasticity and stabil- all, she was a machine operator re- she learned about co-operating with uted to getting on faster. The picture ity. Stability ensures that the edges are sponsible for puzzles for a whole year. the suppliers of materials. One of her was in the foreground. Now she looks precisely cut and that the pieces lie flat Constant quality control is an integral jobs was matching the quality of the much more closely and examines the on the table. These requirements are part of the job. Her own high standard material with the suppliers on the exact fit. What is the most important objectively difficult to define but they is supported by detailed guidelines one hand and the in-house produc- thing? That the fun of the puzzle Sabrina Schramm can be experienced as tangible quali- which can be looked at on the spot. tion on the other. If the material deliv- matches the higher quality standard! Quality Control Assistant

24 25 Mainstay of quality

The syllable ‘le’ in his name that suggests a diminutive is only Upper Swabian local colour, Ravensburger modesty. It would be more appropriate to the size of his responsibility to add a syllable denoting magnitude. Uwe Stützle, head of process engineering and quality control, has been with the company for 18 years. A Ravensburger veteran. Concerned with quality and safety even in his leisure time. For example when he shows his son in Ravensburger Spieleland how to get a lot of fun out of excavating.

Responsibility that has evolved books. Uwe Stützle is the guardian of the high proportion of in-house pro- quality for production in our own fac- duction makes Ravensburger confi- All the things he has done at Ravens­ tories and for the small proportion of dent in its product quality. And this burger have been valuable experience goods and materials which Ravens­ has two strong aspects. It is seen in for his current area of responsibility. burger obtains from business part- the systematic process of ensuring He had holiday jobs at Ravensburger, ners. As the person responsible for quality; but also in the ‘soft’ side of studied physics, trained as a packag- process engineering, Uwe Stützle also quality – the attitude, the evolved ing mechanic, experimented with pro­ researches new methods of produc- standard. cessing, worked on the setting up the tion and materials. In addition, he factory in Chalon, France, did further ­occasionally advises the creative de- Quality is an attitude of mind training in industrial paper process- partments regarding the technical ing, took over the print and print feasibility of new ideas for products. Quality is firmly anchored, even inter- processing departments, reorganised nalised, in the hearts and minds of the process engineering, took over the In-house production as a guarantee employees. This is true of all levels of whole area of quality control. That is a of quality the hierarchy from the managers to responsibility for quality that has the grass roots. In the end Ravens­ evolved. Next to service, quality is the central burger quality manifests itself at the pillar of the Ravensburger business machine, at the conveyor belt, at the Guardian of quality for the whole model. Ravensburger puts its faith in shrink tunnel. Each employee decides group its own development and production with the help of his/her own standards and invests a corresponding amount and the defined guidelines what is ac- As head of process engineering and in ensuring quality. In the interna- ceptable from the quality point of quality control, Uwe Stützle is respon- tional toy market Ravensburger holds view, and where they should inter- sible for the quality and safety of a special position as a result of this: by vene. A shrink-wrap for example must Ravensburger products, from 2008 for far the majority of goods are pro- fit closely, it mustn’t have any holes or the whole Ravensburger group, that is duced in its own factories in Ravens­ produce blisters or creases. And the games, puzzles, arts and crafts as well burg and Poliˇcka in the Czech Repub- question is not whether these defects as children’s and young people’s lic. The most important advantage: would have a negative effect on the

26 27 purchase of the product, the point is Only when all the necessary tests Extra checks for goods from China check on receipt of the goods, in short ing institutes. For example a so-called tomer service department receives far that Ravensburger doesn’t want it to have been passed can prototypes be for everyone involved in the quality drop test makes sure that if a product more frequent enquiries about lost be like that. It doesn’t meet the aes- made, which then also go through a For the co-ordination and quality con- control process. Before a Golden Sam- falls from a certain height it does not pieces of puzzles or games – there are thetic requirements of the company. series of preliminary tests. In the next trol of products made in China, Ravens­ ple gets the seal of approval it has to break into small parts that could be around 33,000 e-mails and 13,000 It doesn’t match the standards set for stage of development the prototype burger maintains its own offices in pass a comprehensive examination of swallowed. The statutory standard is phone calls a year. It is an indication of the contents, the material and the ap- is tested externally, a full report is Hong Kong and China. The staff make its functions, safety and quality. Take 80 cm, Ravensburger tests from a how much service quality means to pearance of Ravensburger products. written, and finally it is tested in- spot checks on the completed goods “Billy Biber”, for example. Here Uwe height of 100 cm. Whether small parts Ravensburger that there are spare Only if all the employees know this house again. Specifically in the area of before they are shipped, to make sure Stützle checks everything. Are all the could be swallowed is also tested parts in stock of all the current range. and are convinced of it will they inter- products for babies and toddlers that they maintain the mechanical test ­reports there? Are all the product against a standard that corresponds vene spontaneously when they notice Ravensburger has its products tested and chemical standards. When the ­descriptions to hand? Do they corre- to the diameter of a child’s gullet. The even the smallest deviation from the by independent external institutes. goods reach Ravensburg the same spond to the materials used? Is a full diameter in Ravensburger’s test is standard. And for example press the And then goes the extra mile, with its checks are carried out once more. test report on the paper and print col- 2.3 mm more than the standard. In or- stop button on the shrink tunnel if the own tests with even stricter safety Ravensburger pays close attention to ours of the instructions included? Are der to exclude the possibility of a child film is not as it should be. regulations. the working conditions at the work- all the statutory warnings on the box? breaking bits off toys and swallowing shops of its suppliers in the Far East. Besides a check on the papers, the them, Ravensburger carries out a ten- Advice on new developments Caution regarding certain materials Almost all of the suppliers are certified Golden Sample test includes checks sile test which is 10 newtons more by the ICTI. This code of the world- on the appearance, the feel and the than the standard. Quality products are created only Another task for quality control is to wide association of toy manufactur- functions. Are the colours of the con- when each individual element of a keep an eye on the whole realm of ers is committed to maintaining legal, tents the same as those on the picture Quality all the way to service product is good quality. Quality can- materials and statutory regulations social, health and ethical standards on the box? Are the figures free of not be put in afterwards. That is why concerning them: which materials in toy factories. The certification is ­injection marks? Do the electronics Another of Uwe Stützle’s responsibili- employees from quality control are in- are considered questionable, which ­renewed regularly by independent work? Uwe Stützle examines several ties is service, more precisely customer volved at the development stage of a ones might be forbidden for products ­inspectors after checks on the spot specimens meticulously. service. All enquiries and complaints new product and advise product man- for small children in the foreseeable in China. are brought together in a central service agers on materials, statutory require- future? Which material ought to be Stricter than the law demands department, systematically recorded ments and technical feasibility. The tested voluntarily already, which An important test: Golden Sample and analysed on a monthly basis. Unu- most sensitive area is products for should not be used, even if it is not The Ravensburger safety standards, sual complaints are followed up and children under 3; here safety is top pri- (yet) banned? “I can only recommend The so-called Golden Sample process particularly for products for babies the points complained about sorted ority. Especially when a completely our children’s toys with a good con- plays a significant role in quality man- and toddlers, go beyond the statutory out or improved if necessary. “Last new product idea is introduced, it is science if I know that we are always agement as a whole. A Golden Sample, standards in many respects. The prod- year we had a complaint rate of less essential to clarify what safety regula- one step ahead,” says Uwe Stützle. a model made in the original material, ucts are tested for mechanical and than one percent,” says Uwe Stützle. Uwe Stützle tions have to be taken into account, This caution is typical of Ravens­ is the point of reference for suppliers, chemical safety in Ravensburger’s own One can easily regard this as confirma- Head of Process Engineering and and what materials can be considered. burger. for the pre-delivery check and the laboratories and at independent test- tion of Ravensburger quality. The cus- Quality Control

28 29 Travelling in Germany

He travels in the name of the blue triangle. He is a Sales Representative on the outside and on the inside a Ravensburger. He looks after and trains the retailers and in the process learns how products and service can be improved. Holger Mehling, always out and about, on his way to a customer.

A dual Ravensburger role and the retail trade in his courses. And is in the shop, the conversation takes because he can pass on suggestions place right there. If the customer has He can even tell you the date of his for improvements from the courses to done his stock-taking, they go through first day at work without hesitation; the product managers. the catalogue page by page and make Holger Mehling has been at Ravens­ up the order. If there is no stock ­survey burger since 1st October 1991. 16 years Inside views from the outside available, Holger Mehling takes on the as a Sales Representative. Actually he job and sometimes spends two or didn’t intend to stay so long, he Holger Mehling spends a lot of time three hours on it, with bigger custom- wanted to get to know the industrial on the road, starting out from Würz- ers it can even be a whole day. De- side for 5 years, after running a branch burg, where he lives. He goes to cus- pending on the turnover and type of of a toy shop for the previous 8 years. tomers, to training courses and some- selling, ­Mehling goes to a customer But he stayed, and two years ago he times to Ravensburger itself. A typical between three and ten times a year. also took over an extra job as a train- working day begins the evening be- ing adviser for retail staff. He is a fore, with the preparation for the vis- Much appreciated by the trade: Ravensburger through and through. its he plans to make to customers: Ravensburger Service And the ideal man for the job because sales targets, turnover figures, dis- he knows both sides, the industry and counts, terms, products. And the next In 1901 Ravensburger, or rather the the retail trade. Holger Mehling is a morning he gets in the car and hopes Otto Maier Verlag, as it was then sales rep with his own customers and to reach the first customer without called, already employed a ‘travelling support service. He looks after 100 any traffic jams. Holger Mehling drives gentleman’, a representative of the customers in specialist stores, in self- according to the trip schedule he has publishers and in this it was one of service shops, in big department drawn up on the basis of his priorities. the pioneers of service to the trade. stores and in specialist markets in He usually visits five or six customers This has remained so. Ravensburger the region around Frankfurt/Main, in a day, and goes over the appoint- provides an above-average service Aschaffenburg, Würzburg and Kitzin- ments in the evening as well as thor- with its unusually large team of sales gen. The combination of sales and oughly preparing for the ones ahead. representatives. They make it possible training is interesting in that he can What form does the visit take at the to give each customer individual at- use much of his experience from sales customer’s? If the owner or manager tention, which is also supported by

30 31 the culture of responsibility that has to train the sales staff so well that give a lot here but also take a lot away evolved. “We back up the retailer with they can present and explain the prod- with him. He is advertising games in sales material and suggestions for ucts adequately. the best sense, communicating his decoration, with sample games and knowledge and enjoyment of the substitute products and we handle Feedback for the game makers games and at the same time learning complaints in a generous and uncom- how the games are seen by the end plicated way. It’s no wonder that the The training courses are very valuable consumers, what they like and what trade has voted us number one for to Ravensburger as sources of infor- they don’t like, what they want and sales service in the toy trade for years mation. Whether people say the in- what’s missing. (a survey in the trade newspaper structions for a game are too compli- “markt intern”).“ Even though the sub- cated or the packaging of a game does Ravensburger freedom ject of price dumping by bulk suppli- not tell you enough about it, the sales ers keeps coming up in discussions on reps relay such information to the edi- Anyone who has worked for a com- the trade side – the Ravensburger tors and product managers respon­ pany for 16 years although he only sales service is and always will be a re- sible. In the case of the packaging, it meant to stay for five has good rea- liable and predictable partner for the is then reworked. Or the sales pro­ sons for it. What Holger Mehling espe- retailer. A part of that is the fact that motion material for a product is re­ cially appreciates about Ravensburger the shops are treated equally when it designed or additional presentation is the ability that his job offers him to comes to allocating articles and the tools are provided. The feedback is leave his mark, the sense of personal reliable systems regarding terms. The particularly important for new prod- responsibility, the freedom to make retailers also greatly appreciate the ucts, whether it comes from training decisions. The other thing he values fact that Ravensburger can deliver courses or direct from everyday sales. is the esprit de corps between his col- goods right up to Christmas. Holger Mehling takes every sugges- leagues. You get on with everyone tion seriously, even the smallest qual- ­really, he says. Another thing that is Training courses all over Germany ity defect, and passes it on to the ap- special about Ravensburger: you are propriate person. As well as new not just a number, you don’t just do Whereas Holger Mehling’s work as a products, games that have been in the your job. On the contrary, it’s a good Sales Representative is restricted to a range for a long time but need a little feeling to know that you are going to relatively small area, as a Training Ad- nudge are presented at the courses. the customer with good products. You viser he travels all over Germany. On Or games that have sold very well but are proud to be travelling in the name 80 days a year altogether he trains are not being played correctly by many of the blue triangle. sales staff, buyers and staff instruc- users. That is what training courses tors from the retail trade as well as are primarily there for, of course: sales demonstrators from Ravensburger. promotion at first hand. For the technically demanding new product “Paper Creation®” patterns Welcome to the family games day and colour variations are presented, and the product’s possibilities ex- Once a year Holger Mehling holds a plained; the centrepiece is a film show- very special training course, voluntar- ing how to create artistic objects. ily. Not for retailers, but for Ravens­ Questions of quality, stability, how to burger’s actual target group: families. deal with complaints and further pur- The event, organised by a religious in- chases of the contents are also dis- stitution in Würzburg, has already be- cussed. What Holger Mehling keeps come a tradition and is booked up two noticing at his training courses is the years in advance. Around 20 families, increasing difficulty in understanding 60 to 70 children and adults between the rules of games. This is partly to do 4 and 60, meet under the motto: Get with problems of time but also with a away from the computer! Play board general decrease in willingness to games instead! What the Ravens­ Holger Mehling read complicated instructions. Of burger salesman particularly likes Sales Representative and course it is in Ravensburger’s interest about these weekends is that he can Training Adviser

32 33 Book-keeping

The figures in the second part of this report come chiefly from her. But Andrea Rogait’s contribution to the company is even greater, because her heart is not only in the figures, but also in what really counts in dealings with business ­partners – correctness, fairness, openness, long-term thinking, in short the Ravensburger attitude.

The balance sheet is correct great deal of responsibility. Andrea tions at source. She can advise on vari- Rogait’s main job is preparing the ous problems in the field of turnover Andrea Rogait is a company account- ­consolidated ­accounts. This comprises tax or income tax, and she helps the ant, originally a tax consultant, who consolidation, bringing together the subsidiaries abroad to deal with their has worked at Ravensburger for 14 figures for the subsidiaries, and the tax obligations in Germany. years altogether. The last 12 years, and figures for the annual report. What with a gap of 18 months, the two gives her ­particular pleasure in this Good book-keeping creates planning years before. In the year and a half in job, what makes her happy? “When reliability between she took up the challenge of the annual accounts are finished and building up the accounts department there are no mistakes and they go Good book-keeping is the basis for the in a smaller company but she left through on time and are then printed financial management of a company. Ravensburger very reluctantly. She in the annual ­report, that does make Only if one has exact up-to-date was therefore almost compelled to me proud. You think once again: Yes, ­figures can one judge the financial agree when Ravensburger asked her I’ve done it, and it went well.” ­position, know how much room to to come back. Especially as her task manoeuvre one has and plan reliably. was successfully completed. Andrea Tax returns “For this purpose we draw up both Rogait still remembers that phone call ­actual and projected balance sheets at 12 years ago very well. Her interest in Andrea Rogait’s second area of re- the end of each quarter. That means Ravensburger and in new perspec- sponsibility involves working with tax that even before the final annual ac- tives for development made her glad authorities and tax consultants, and counts are presented we can discuss to return. “It was meant to be, I be- dealing with internal enquiries regard- and make use of the margins available lieve, the way it came about,” she says. ing tax matters. She answers special and react to current law. In this way Her personal balance sheet is correct. questions from the sales department we can anticipate important work on concerning supplies from other coun- the final accounts, which in turn helps Proud of the end-of-year accounts tries, for example. She deals with tax us to compile the final accounts on enquiries about invoicing within the time. The important thing here,” ex- “Consolidated accounting, taxes and Ravensburger group. For the freelance plains Andrea Rogait, “is that accuracy insurance” it says on her business department she is the person foreign is the predominant feature of the work card. Three very different tasks with a authors contact regarding tax deduc- ethic. It is crucial to have well-trained

34 35 and highly motivated staff, who are Weighing everything up rather than think like this because Ravensburger is Ravensburger: correctness and abso- capable of fully understanding proc- short-term advantages a family business with a long-term lute compliance with the law. “We esses and putting them into prac- outlook.” only do what we are committed to tice.” Besides this, the technical equip- Another of Andrea Rogait’s areas of with a good conscience,” Andrea ment is also an important factor. ­responsibility must be mentioned: Not a cold world of numbers ­Rogait emphasises. “All decisions are Efficient hardware and software, ­insurance management, property in- carefully weighed up. We think long- which provide reliable, sophisticated surance, to be precise. This covers fire “Fairness, friendliness and loyalty to term and cautiously, we act with con- analysis methods are indispensable and liability, in both cases for the colleagues are not a matter of chance sideration. We feel connected to the nowadays. whole group. Two aspects are es­ in the accounts department. They other people in the company. We know pecially important. One is risk man­ have something to do with the Ravens- the family that founded it. The job is Planning ­reliability agement, that is, the question of burger philosophy and with the spirit much more than just a rung on the where improvements are possible in of the family business.” Andrea Rogait ­career ladder.” The only thing we are The budget is also consolidated by order to minimise risks. Thanks to has experienced the other side in her calculating about is that the accounts ­Andrea Rogait. “The budget begins close co-operation with the technol- career, where the job is only a job, balance in the long term. with the turnover plan for the sales ogy ­department, this gives her inter- where it’s every man for himself, department. The material costs and esting insights into other areas of the where there is nothing friendly about other kinds of expenditure planned by company, right down to production. it and nothing that binds people to- the relevant departments are then re- The other aspect, in which once again gether. “At Ravensburger on the other lated to this amount. On the basis of the typical Ravensburger philosophy hand, there is a sense of together- the results arising from this and the is seen, is the way they deal with their ness,” she says. “The world of numbers budget propositions, a budget balance existing insurance partners. And with is not cold at all, our contact with each sheet and profit and loss account is the many companies who want to do other is friendly and respectful. We prepared.“ When these figures reach business with Ravensburger. “Instead help each other in our work, we dis- Andrea Rogait at the end of the year of only looking out for favourable cuss problems.” It is no coincidence she really has a lot to do. All the subsid- rates and playing off one insurance that many colleagues have been with iaries send in their budgeted balance company against another, we value the company for a long time, some sheets. In the course of this process, long-term business partnerships, mu- longer than she has. questions that arise from the subsid­ tual reliability and honesty.” This has iaries are answered and, after a plausi- always worked well, particularly in Head, number and heart bility check, the figures are added up dif­ficult situations. “On a monetary in a group file. After that, the consoli- and on a human level.” And there’s In addition to the ‘soft’ factors, there Andrea Rogait dation process begins, the elimination ­another fact that Andrea Rogait is is a basic attitude that characterises Company Accounting, of intra-company relationships. ­always aware of. “We can afford to the book-keeping department at Tax and Insurance

36 37 A Ravensburger in America

It is one of the most important toy shops in the world. It is the address for toys in New York: here at FAO Schwarz on Fifth Avenue Ravensburger is one of the top 5 suppliers and is the only manufacturer of games and puzzles to have its own shop-in-shop here. And Thomas Käppeler is the energetic Ravensburger on the spot.

A New York legend many years, was invited to set up its in New York. The next thing that’s own shop-in-shop, which meant that planned is a second shop-in-shop at European tourists like to drop in here the stock could be greatly increased. FAO Schwarz in Las Vegas. to buy their genuine New York souvenir Today Ravensburger is exclusively rep- puzzle at FAO Schwarz on Fifth Ave- resented with children’s games and The refined specialist trade and the nue, right next to the Apple store. Rich puzzles. No wonder Thomas Käppeler, lucrative mass market New Yorkers shop in the prestigious CEO of Ravensburger F.X. Schmid USA, New York toy shop too. It’s not un- Inc. is proud of such a brand presence Ravensburger’s core business, in the usual to see celebrities slip through in the USA. In addition to puzzles and USA as in Europe, is in specialist shops. the door carrying their children. A clien- children’s games, the stock also in- The customers are also comparable. tele that consciously wants to see its cludes arts and crafts such as “Mandala They are better educated and have an offspring grow up with high-quality Designer®” and “Painting by Num- above-average net household income. toys. Sometimes New York parents bers®.” According to David Niggli, In the specialist trade Ravensburger is may have their nurseries kitted by FAO Chief Merchandising Officer at FAO the number one with puzzles and Schwarz for 20,000 or 30,000 dollars. Schwarz, Ravensburger is valued as a games, and has a market recognition At FAO Schwarz the high New York leading brand in the specialist trade, of 90 percent. As regards sales Ravens­ prices are higher still. But that is not as a supplier with the highest quality burger is one of the top 5 suppliers. really what counts. What matters for puzzles in the USA and as a European One of the factors in this success, ac- Schwarz customers is the guarantee manufacturer. FAO Schwarz stocks by cording to Thomas Käppeler, is the that they are getting exclusive brands far the largest range of Ravensburger perception of Ravensburger as a Ger- and the best quality. specialist products. The bestsellers man brand, which is associated with are the 540-piece “puzzleball®” The excellent engineering, top quality and More than a blue corner: Earth, the 240-piece “puzzleball®” The reliability – just like German cars. The Shop-in-Shop Globe, the puzzle mat, the 2000-piece ­Despite its good standing in the spe- puzzle New York and the game cialist trade, Ravensburger has de- When FAO Schwarz rethought its “Make‘N‘Break”. “FAO Schwarz is our cided on a more aggressive approach sales strategy in 2007 with more em- biggest speciality retail client. They to its marketing strategy and has phasis on quality, originality and de- are only four hours’ drive from our of- been supplying mass market shops sign integrity, many of its suppliers fice and they spend over 500,000 dol- like Walmart and Target more inten- and products were rejected. Ravens­ lars a year,” says Thomas Käppeler, sively for some time. To avoid clashes burger on the other hand, which had who maintains the relationship per- with the quality image in the special- been represented at FAO Schwarz for sonally and often drops in when he’s ist trade however, Ravensburger is

38 39 represented here by a reduced range says Thomas Käppeler. The perception shire, about 50 km northwest of the USA. And what does Thomas and only with puzzles for adults. “In of Ravensburger puzzle quality is also ­Boston and about 4 hours’ drive from ­Käppeler find exciting about working spite of the restrictive policy regard- remarkable: particularly customers New York. At One Puzzle Lane there in sales? “The fact that the situation ing the range, we’re selling most to who don’t normally buy in specialist are about 20 employees. The fitting changes every day, almost every hour. Walmart, followed by Target and the shops write letters enthusing about address came about because Ravens­ It doesn’t matter whether you’re ­going bookshop chain Barnes and Noble, the quality they have never experi- burger built on a newly developed to a client or wherever, there’s always which are equal, and in fourth place enced before, about the perfect fit of area and was allowed to choose the something new.” That sounds a bit like FAO Schwarz. That makes FAO our the pieces and the fact that the cor- address. What could be more appro- unlimited opportunities. Thomas Käp- largest customer in the specialist toy ners of the pieces don’t break off. But priate than “Puzzle Lane”. peler is in exactly the right country. trade,” says Thomas Käppeler, sum- the success of Ravensburger puzzles is marising the market position. Ravens­ due not least to consistent brand man- The exciting part of sales burger USA now achieves an annual agement and the uniform appearance turnover of 15 million dollars. The re- of the packaging with its unmistakable And Thomas Käppeler? Does he still markable thing is that this significant lettering and blue triangle. feel like a Ravensburger after a good growth, virtually double, has occurred ten years in America? “Very much so,” in the last four years. Appropriate address: One Puzzle Lane he says, “I have come to really appre­ ciate the company, I owe my entire A puzzle market divided into two Ravensburger has had a distribution ­career to it. I am very attached to company in the USA since the 1980s. Ravensburger and proud to represent The American puzzle market actually But the takeover of F.X. Schmid in 1998 the blue triangle in America.” Thomas consists of two markets: an aggressive including its American subsidiary Käppeler started at Ravensburger in mass market with low-priced goods brought a new quality to the US pres- the market research department in on the one hand and a specialist trade ence. Ravensburger has been active in 1989, after his university studies. Be- market. Completely different manu- the USA since 1999 with its own sub- fore that he had completed two place- facturers and products are found in sidiary, developing and distributing ments there and various jobs during the two markets. Ravensburger, the games for children, adults and fami- the school holidays and university clear number one in the specialist lies and puzzles for children and adults ­holidays. As if this connection from his shops, is ranked fourth in the total in the USA and Canada. F.X. Schmid youth were not enough – Käppeler puzzle market, which is a very respect- puzzles for adults are still in the range was born in Ravensburg. So he started able position, in view of its low market and SIMBA toys and SIKU are sold. in market research, began to get bored share. “Fourth place is also respect­ Ravensburger F.X. Schmid USA, Inc., after a few years (which a shrewd boss able because we have worked our way that is the official name of the com- had prophesied at his job interview) Thomas Käppeler up from eighth in a very short time,” pany, is based in Newton, New Hamp- and moved to international sales. To CEO Ravensburger · F.X. Schmid USA, Inc.

40 41 Financial Statements

42 43 Annual Report of the Ravensburger AG Group

Business development and situation and Arts/Crafts division, the Children’s and Youth Books The expansion of the important product brands and a wide Children’s and Youth Book division in 2007 division and the Leisure and Promotion Service division. range of international licences contributed to the develop- ment in turnover: Despite a restrained overall Christmas trade, the book mar- The general business environment for the Ravensburger The Games, Puzzles and Arts/Crafts division develops, ket in Germany experienced a satisfactory development in Group in the fiscal year 2007 was characterised by a produces and sells its products internationally with the In the games sector, turnover was increased by 3.9 %. Here 2007 with an increase of just over 3 %. By far the most suc- ­heterogeneous development in the individual sales mar- main focus on Europe. In the large European markets the new concept of the “spielend neues lernen®” range in- cessful was the category Children’s and Youth books, which kets. Whereas the markets for toys and games showed such as France, the United Kingdom, Italy, Spain, Benelux, troduced in 2006 again had a positive effect on turnover, showed strong growth, especially in the 4th quarter, thanks ­increases in Germany, France, Italy, the Benelux countries, Austria and ­Switzerland, as in the United States, separate particularly in Germany. In addition to the new electronic to particularly successful bestsellers. Overall, this market Austria and Spain, the markets in the United Kingdom, distribution companies are maintained, whereas smaller version of the children’s game “Wer war’s?” and the great segment achieved growth of more than 20 %. Switzerland and the United States were stagnant or ­decreased markets are served from Germany in the form of export success of the line extension “Make’N’Break Extreme”, the slightly. Both the American dollar and the British pound business. The products are mostly produced in Group- long-selling family games grouped under the heading of The Ravensburger book publishing company was able to considerably declined in value in the course of the fiscal year, owned factories in Germany and the Czech Republic, “Our best family games” contributed to the growth. The ­increase turnover for the 7th year in a row with growth of which had negative effects­ on turnover in these countries. whereas logistics are controlled from Germany. games brand “memory®” was also successful in 2007. In the 5.7 % to € 50.3 million despite the difficult competitive card games sector, the success story of “Phase 10” continued. ­situation, and continues to be one of the leading suppliers In nearly all markets, concentration of trade continued. The Children’s and Youth Books division concentrates on in the children’s and youth book market. the German-speaking markets and publishes picture In the puzzles product sector, turnover in the past fiscal Under these prevailing conditions, the Ravensburger Group books, children’s non-fiction and fictional children’s and year decreased by - 5.0 %. However, it must be taken into As in the previous year, the success was supported by was able to exploit the strengths of its products in terms of youth books. account here that in the previous year more than € 10.7 mil- many product segments. Special mention should be content, quality and service and hold or further strengthen lion was achieved with FIFA licensed products for the World made here of the young children’s range “ministeps®” with its market position. With the Ravensburger Spieleland adventure park, the Cup. Adjusted by this turnover received in the previous year, an ­increase in turnover of 46.1 %, the product brand Leisure and Promotion Service division is aimed at children the development in turnover looks much better. “Wieso?Weshalb?Warum?” with an increase of 8.0 %, the and parents and offers various types of attractions suit- learning range with growth in turnover of 27.5 % and the Overview of the Ravensburger AG and Group able for children. Promotions and events are also offered The turnover of the two most important product families paperback and children’s and youth fiction range with an as services for other brand name companies. in the Art/Crafts division – “Painting by Numbers” and increase in turnover of 9.6 % and 3.0 % respectively. The “Mandala-Designer®” – increased again in 2007. Together only category significantly below the level of the previous Ravensburger AG is the managing holding company of with the introduction of the new product line “Paper Crea- year with - 15.0 % was children’s non-fiction. However, this the Ravensburger group of companies. Various functions Business development of the operative divisions tion®”, the Arts/Crafts division increased by 8.7 %. decrease in turnover was not unexpected, as 2006 included of the Group or of the German subsidiaries are performed special effects with corresponding figures (anniversary pro- centrally by specialised divisions of the Ravensburger AG. Games, Puzzles and Arts/Crafts division The turnover of the product line “ministeps®” also greatly motion 50 years of non-fiction, World Cup). Only the cate- This applies in particular to the functions of finance, increased and is the 5th most successful young children’s gory of picture books failed to meet expectations, as two treasury, central controllership, central marketing, public The turnover of the division increased by 0.6 % (1.4 % at brand in Germany. main titles did not achieve the planned sales figures in the relations, human resources, IT and legal issues. constant exchange rates) from € 229.5 million in the previ- 2nd half of the year. ous year to € 230.9 million in 2007. The largest single market In the fiscal year 2007, more production units began to In addition to the holding function, Ravensburger AG (RAG) of the division is still Germany. In the past fiscal year, an in- move from Ravensburg to the factory in Poliˇcka/Czech also leases the land and buildings in Ravensburg to the crease in turnover of + 2.6 % was achieved. Approximately ­Republic. When this project is completed, approx. 3.2 mil- Leisure and Promotion Service division ­operative subsidiaries and licenses the use of the Ravens­ 60 % of the turnover is achieved abroad. The strongest lion games production units will have been moved. This burger brand to the companies of the group. ­Finally it controls growth market of the Ravensburger Group in 2007 was Spain measure was necessary to meet the increased logistical Ravensburger Spieleland AG and coordinates the group-wide risk management system. with a growth of + 27.5 %, followed by Italy with + 8.3 % and ­requirements of the markets supplied from Ravensburg. A total of 355,000 visitors were welcomed to Spieleland in the USA with + 7.7 % (at constant exchange rates + 17.5 %). 2007. The number of visitors therefore increased in the 10th The operative business of the Ravensburger Group is run France remained the most important foreign market in 2007. year of opening by 7.5 % compared with the previous year. by the subsidiaries of the Ravensburger AG. The Group is Here the development in turnover was disappointing, with The total of almost 8,000 season tickets sold (+ 62.3 %) and divided into three business divisions, the Games, Puzzles a decrease of - 7.4 %, likewise in the United Kingdom (- 2.2 %). 1,200 annual tickets (+ 68.6 %) and the associated increase

44 45 in the number of repeat visitors, plus the good weather, Situation of the Ravensburger AG Group ­reversal of accruals, the result of ordinary business was € 4.3 However, there was a slight reduction in capital commit- contributed to the increase in the number of visitors to the million above the figure of 2006. ment in operative current assets (stocks, receivables and park. In addition to a large number of activities for the 10th other assets). Stocks increased particularly in the Games, anniversary of Ravensburger Spieleland, the unusually good Income situation The extraordinary result of the Group was at the same level Puzzles and Arts/Crafts division as a result of a date-related spring weather led to an increase in one-time visitors. With as the previous year, at € - 0.5 million. increase to secure high delivery capacity in the Christmas about 272,000 visitors paying admission (season and annual The Ravensburger Group achieved a consolidated turn­ season by € 2.5 million. In contrast, however, receivables ticket holders are only counted once here), this number of over in all divisions in the 2007 fiscal year of € 285.8 mil- Tax expenses decreased in the past fiscal year to € 13.7 mil- from goods and services decreased by € 4.7 million. visitors was also considerably higher in the 2007 season lion (+ 1.5 %). lion (previous year € 14.4 million). The decrease results in compared with the previous year (+ 8.0 % paying guests). particular from the reduction in expenses for deferred With a turnover of € 6.3 million (+ 13.8 % compared with the Miscellaneous operating revenues amounted to € 6.0 mil- taxes. Liquidity / cash flow previous year), Ravensburger Spieleland achieved its high- lion and were therefore significantly below those of the est turn­over since it opened. In addition to the considerable previous year, which was due to the reversal of accruals in On balance, the Ravensburger Group succeeded in main- The cash flow from current business activities of the increase in visitor numbers, an increase in admission prices the previous year. taining its consolidated end of year result after tax at a high ­Ravensburger Group was € 38.2 million in the year covered by an average of € 1 for single tickets and considerably level of € 25.8 million. The result reflects the good operative by the report and was therefore € 16.6 million above the ­increased secondary revenues in gastronomy and shop/ The operating expenses items only increased slightly by 1.8 % earning power and unlike the previous year is not influ- ­figure of the previous year (€ 21.6 million) as at the specified merchandising contributed to the increase in turnover. to € 255.6 million. Material costs increased, for example, by enced by positive special effects. date. Although the annual net profit of € 25.8 million was Here, too, the anniversary activities had a positive effect. 1.4 % to € 84.0 million, as the proportion of in-house pro- € 5.1 million below the figure of the previous year and the duction was increased. Nevertheless, personnel costs were balance from depreciations and appreciations on the fixed Despite the pleasing development in turnover, however, a reduced to € 64.1 million, although the average number of Assets assets decreased by € 0.3 million, an additional € 12.8 million loss of € 1.2 million was recorded. employees increased in 2007. This increase was mainly due was released from operatively necessary current assets to the expansion of games production in the Czech Republic With € 257.8 million, the balance sheet total of the Group as (stocks, receivables and liabilities from goods and services) The majority of Spieleland visitors came from Germany in with considerably lower pay levels. In addition, personnel at 31 December 2007 is € 20.7 million above the figure of the and from accruals (+ € 5.6 million). 2007 (63 %). The proportion of visitors from Switzerland costs of the previous year included one-time higher accruals previous year (€ 237.1 million). The increase in assets is due ­increased by 6 % points to 28 %. 6 % came from Austria and for pensions. Depreciations of tangible assets and intangible almost entirely to increased liquidity. The cash flow from investment activity improved by € 23.5 3 % came from the other European countries. assets decreased by € 0.7 million to € 6.2 million. Miscella- million. There were higher investments in fixed assets (€ 2.5 neous operating expenses, on the other hand, increased by On balance, fixed assets decreased by € 2.5 million to million) and considerably lower investments in bonds of € 5.3 million to € 101.3 million. In addition to administrative € 61.6 million. The investments in tangible assets of € 5.8 fixed and current assets (- € 26.0 million). Ravensburger Leisure & Promotion Service Division GmbH costs, royalties contributed to the increase in these expen­ million were significantly higher than the previous year The Ravensburger event agency is a service provider for ses. These increased due to the continuing rise in turnover (€ 3.3 million), but less than the depreciations of tangible Despite a considerably higher dividend payment of € 14.4 business customers in the sectors of stationary and mobile from licensed products. Communication costs increased assets (€ 6.4 million). As a result, the fixed assets de- million, the capital fund increased from € 50.6 million at the brand environments, children’s corners and events. With as a result of specific investments in individual European creased at the end of 2007 by € 0.8 million compared to end of 2006 to € 72.9 million at the end of the 2007 fiscal tours of shopping centres, town festivals and consumer markets strategically defined as growth regions. the previous year. Fixed assets also include the long-term year. However, it must also be taken into consideration that trade fairs as well as the design and implementation of var- bonds of the asset management system introduced in the dividend has not been paid out in full. ious children’s corners, turnover of € 1.9 million was achieved The financial result increased by€ 1.5 million to € 2.8 million. the previous year, which were € 1.6 million less than the in the past year. In the 2007 fiscal year, unprofitable turn- The main reason for this was higher interest revenue from pre­vious year. The Ravensburger Group has no liabilities to banks as at the over was deliberately avoided, for which reason turnover interest on current accounts, and the reduction in interest end of the year. decreased by - 11.5 % compared with the previous year. expenses as a result of the shareholders’ loans which were Current assets increased in the same period by € 23.7 million repaid in full the previous year. to € 194.8 million. This includes the shares also held in the asset management system. The securities item in current Financing structure The result of ordinary business was € 40.0 million, € 5.6 mil- assets increased by € 2.6 million to € 12.2 million. Cash and lion below the level of the previous year. Adjusted by the cash equivalents increased to € 72.9 million (previous year The shareholders’ equity of the Ravensburger Group in- special effect contained in the previous year from the € 50.6 million). creased in the past fiscal year from € 121.2 million to € 131.7

46 47 million. This was attributable to the net annual income Outlook at the beginning of the 2008 Children’s and Youth Books division Ravensburger Group of the Group of € 25.8 million, reduced by the dividend fiscal year ­payment of € 14.4 million. The shareholders’ equity ratio The Ravensburger book publishing company expects ­further Considered as a whole, the Managing Board of the Ravens­ ­remained unchanged at 51.1 % on the accounting date, as growth in turnover and increased market shares in 2008. burger AG expects generally stable business development the build-up of liquid funds led to a corresponding increase Games, Puzzles and Arts/Crafts division in 2008. Difficult external conditions are balanced by the in total assets and liabilities. However, the increasing concentration of trade and the good positioning and quality of the Ravensburger products The business division will continue to pursue its targets ­accelerated decline of small and medium-sized bookshops and brands and the creativity and commitment of our em- The pension accruals were virtually unchanged at € 25.4 defined­ as part of the long-term strategy. The main measures offer only low chances of growth in the medium term. ployees. million. concern: Nevertheless, the Ravensburger book publishing company Against this background, it remains our objective to main- Tax accruals increased in 2007 to € 13.7 million (previous • investments in further improvement of the market posi- regards itself as well equipped to successfully defend its tain and improve the results achieved. year € 10.7 million). This was due to lower tax pre-payments tion in the individual countries, market position. With its high-quality product range and a throughout the year compared with the expected tax bur- • definition and development of pan-European product leading position in many product sectors, the situation is There were no incidents of particular importance after the den. Miscellaneous accruals decreased in the past fiscal brands under the Ravensburger® label, assessed as very stable. The book publishing company will accounting date. year by € 3.6 million. The accruals formed in the previous • establishment of standard processes in the area of sales also be very much influenced by the 125th anniversary of years for various risks were essentially used up in 2007 with- promotion and development towards a sales organisa- the Group in 2008. It is the incentive for a plan of action for out the need for new accruals of a comparable amount. tion in all distribution companies, the whole year in all important product sectors and a large Ravensburg, March 10, 2008 • implementation of an innovation process in the area of number of events with children. Accounts payable including advance payments received product development. The Managing Board ­increased by € 4.2 million as at the accounting date. The new products presented at the Nuremberg toy fair at Ravensburger Leisure and Promotion Service division As a result of the private accounts of several limited part- the beginning of 2008, including the products specially de- ners of Ravensburger Holding GmbH & Co. KG previously veloped for the 125th anniversary, were very well received by In the 2008 season, the public profile of Ravensburger accounted at this KG and transferred to the RAG in 2007, the trade. Together with the wide range of products already Spieleland is to be further improved with specific measures miscellaneous accounts payable increased and accounts sold in 2007, this should ensure a continued satisfactory relating to sales, marketing and public relations and the payable to associated companies decreased accordingly. ­development in turnover and profits for the current year. catchment area of visitors expanded. No major investments in new attractions are planned at the Ravensburger Spiele- An average total of 1,491 employees were employed in the The following points are regarded as possible risks for busi- land. Ravensburger Group in the course of the 2007 fiscal year ness development in the current year: (previous year 1,426) (excluding seasonal staff of Ravens­ Expected numbers of visitors for the 2008 season are the burger Spieleland AG and Ravensburger Leisure & Promo- • the increasing concentration of trade with the risk of a same as the previous year. Additional use of the park for in- tion Service GmbH). The increase occurred in particular in ­reduction in margins for the industry, centive and marketing events of corporate customers will the Games, Puzzles and Arts/Crafts division and was mainly • a partially disastrous price competition in trade, continue to be offered. due to the expansion of the production facilities in the • further increases in transport costs, Czech Republic. • the increasingly later Christmas trade, which makes it As in previous years, the Ravensburger Leisure & Promotion ­extremely difficult to effect follow-up deliveries in time. Service GmbH will also organise touring events in 2008. New growth potential will be generated by creating individ- ual concepts for children’s corners as well as stationary and mobile brand environments.

48 49 Consolidated Balance Sheet of Ravensburger AG Group, Ravensburg, Balance Sheet as of December 31, 2007

ASSETS € € € T€ LIABILITIES AND SHAREHOLDERS EQUITY € € T€

31.12.2006 31.12.2006

A FIXED ASSETS A EQUITY I. Intangible Assets 1. Film rights, software, licences and similar rights 177,493.31 329 I. Subscribed Capital 12,480,000.00 12,480 2. Payments in advance 5,520.00 0 183,013.31 329 II. Capital Reserves 39,050,000.00 39,050 II. Tangible Assets 1. Land and buildings 32,604,705.74 32,551 III. Earning Reserves 17,798,099.25 20,194 2. Technical equipment and machinery 3,097,869.78 3,639 3. Other equipment, factory and office equipment 7,116,487.13 8,263 IV. Retained Earnings 62,376,149.08 49,520 4. Payments on account and assets under construction 858,689.30 55 131,704,248.33 121,244 43,677,751.95 44,508 III. Financial Assets B ACCRUALS 1. Shares in affiliated enterprises 1,432,452.51 1,433 1. Accruals for pensions 25,355,852.97 25,026 2. Participations in affiliated enterprises 500,000.00 511 2. Tax accruals 13,717,428.13 10,729 3. Participations 15,289.00 15 3. Other accruals 29,016,464.92 32,646 4. Long-term investments 15,804,983.62 17,390 68,089,746.02 68,401 17,752,725.13 19,349 61,613,490.39 64,186 C LIABILITIES B CURRENT ASSETS 1. Customer advances 18,555.32 547 I. Inventories 2. Trade payables 28,784,504.88 24,056 1. Raw materials and supplies 6,524,531.38 5,022 3. Payables to affiliated companies 815,635.97 16,551 2. Work in process 3,403,894.10 3,283 4. Other liabilities 28,333,859.85 6,248 3. Finished goods and merchandise 14,068,508.89 13,100 57,952,556.02 47,402 4. Payments on account 469,057.68 546 D DEFERRED INCOME 11,374.71 8 24,465,992.05 21,951 II. Receivables and Other Assets 1. Trade receivables 75,129,739.68 79,838 2. Receivables from affiliated enterprises 2,551,925.76 1,102 3. Receivables from enterprises in which the company has a participating interest 420,251.76 259 4. Other assets 7,084,654.96 7,770 85,186,572.16 88,969 III. Securities Other securities 12,241,857.29 9,649

IV. Cash on Hand, Central Bank Balances and Bank Balances 72,910,178.93 50,546 194,804,600.43 171,115 C PREPAID EXPENSES 451,644.35 662 D DEFERRED TAXES 888,189.91 1,092

257,757,925.08 237,055 257,757,925.08 237,055

50 51 Consolidated Income Statement of Ravensburger AG Group, Ravensburg, for the Period January 1, 2007 through December 31, 2007 Organigram of the Ravensburger AG Group

2006 € € € T€ Ravensburger Leisure & Promotion Service Division GmbH 1. Turnover 285,760,585.03 281,505 Meckenbeuren near Liebenau/ Germany 2. Increase (previous year decrease) in finished goods, inventories and work in progress 988,095.01 -1,404 3. Other operating income 6,027,545.58 15,174 Ravensburger Spieleland AG 292,776,225.62 295,275 Meckenbeuren near Liebenau/Germany 4. Cost of materials Ravensburger AG a) Cost of raw materials, consumables Ravensburg/Germany and supplies and of purchased merchandise 74,060,157.14 71,902 Jeux Ravensburger S.A. Pfastatt/France b) Cost of purchased services 9,915,771.30 10,856 Ravensburger Buchverlag Otto Maier GmbH 83,975,928.44 82,758 Ravensburg/Germany 208,800,297.18 212,517 5. Personnel expenses Ravensburger Ravensburger Ltd. a) Wages and salaries 51,405,764.08 51,306 Ravensburger Karton s.r.o. Spieleverlag GmbH Bicester/Great Britain b) Social security and Polick a/Czech Republic employee benefits 10,374,046.55 10,360 Ravensburg/Germany c) Pensions and other benefits 2,295,659.17 3,666 64,075,469.80 6. Depreciation of intangible fixed assets Carlit + Ravensburger AG Ravensburger S.A./N.V. and tangible assets 6,197,802.29 6,855 Würenlos/Switzerland Brussels/Belgium 7. Other operating expenses 101,321,067.55 96,034 171,594,339.64 37,205,957.54 44,296 8. Income from profit and loss absorption/ Ravensburger B.V. Ravensburger transfer agreement 2,999.46 11 Amersfoort/Netherlands Gesellschaft m.b.H. 9. Income from participations 800,404.90 750 Vienna/Austria 10. Income from associated enterprises 0.00 18 11. Income from other investment and loans including book profits and write-up income 803,420.01 365 Ravensburger Iberica S.L.U. Ravensburger Madrid/Spain 12. Other interest and similar income 2,434,483.50 1,638 Hong Kong Limited 4,041,307.87 Hong Kong/China

13. Dispositions of financial assets and of current asset securities Ravensburger F.X. including disposition losses 312,231.66 156 Schmid USA, Inc. 14. Interest and similar expenses 942,156.50 1,299 Ravensburger S.p.A. Newton/New Hampshire/USA Milan/Italy 1,254,388.16 2,786,919.71 1,327 15. Results from ordinary operation 39,992,877.25 45,623 16. Extraordinary results -455,468.00 -347 17. Taxes on income 13,167,782.09 13,665 18. Other taxes 533,250.25 734 19. Income or expense tax of allocation group relief 1,999.00 7 13,699,033.34 14,392 20. Consolidated income of the year 25,838,375.91 30,883 Games, Puzzles and Arts/Crafts division 21. Prior period unappropriated retained earnings brought forward 35,120,429.04 31,579 Children’s and Youth Books division 22. Transfer from revenue reserves (previous year transfer to profit reserves) 1,417,344.13 -12,942 Leisure and Promotion Service division 23. Retained earnings 62,376,149.08 49,520

43 2007 Annual Report of the ­Ravensburger AG Group

We are Ravensburger

2007 Annual Report Ravensburger AG Group Ravensburg, May 2008

Publisher: Ravensburger AG P. O. Box 18 60 88188 Ravensburg [email protected]