Consolidated Financial Statements As at 30 June 2020, Group Management Report and Independent Auditor's Report for the Financ
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Consolidated Financial Statements as at 30 June 2020, Group Management Report and Independent Auditor’s Report for the Financial Year from 1 July 2019 to 30 June 2020 Hertha BSC GmbH & Co. Kommanditgesellschaft auf Aktien (KGaA) Berlin Free translation of excerpts of the Original German Financial Statements Mazars GmbH & Co. KG Wirtschaftsprüfungsgesellschaft Steuerberatungsgesellschaft INDEX OF APPENDICES 1. Consolidated Balance Sheet as at 30 June 2020 2. Consolidated Income Statement for the Financial Year from 1 July 2019 to 30 June 2020 [German GAAP (HGB)] 3. Notes to the Consolidated Financial Statements for the Financial Year from 1 July 2019 to 30 June 2020 4. Consolidated Statement of Cash Flows in Accordance with German Accounting Stand- ard 21 (DRS 21) for the period from 1 July 2019 to 30 June 2020 5. Consolidated Statement of Changes in Equity 6. Group Management Report for the Financial Year from 1 July 2019 to 30 June 2020 7. Independent Auditor’s Report General Engagement Terms Appendix 1. Hertha BSC GmbH & Co. Kommanditgesellschaft auf Aktien (KGaA), Berlin C O N S O L I D A T E D B A L A N C E S H E E T as at 30 June 2020 A S S E T S Prior year E Q U I T Y & L I A B I L I T I E S Prior year € € € in thousand € € € in thousand € A. Fixed assets A. Equity I. Intangible assets I. Share capital 5,189,621.00 4,160 1. Concessions purchased, II. Capital reserve 221,412,398.23 123,440 industrial property rights and similar III. Consolidated loss carryforward -136,417,042.32 -110,385 rights and assets and licenses to IV. Consolidated net loss for the year -53,460,923.04 -26,032 such rights and assets 723,859.00 496 VI. Profit participation rights 0.00 17,000 2. Player registrations 106,401,889.19 17,223 36,724,053.87 (8,183) 3. Payments made on account 0.00 57 107,125,748.19 (17,776) II. Property, plant and equipment B. Provisions 1. Buildings on third-party land 2,254,636.00 1,935 Other provisions 4,115,760.35 11,067 2. Operating and office equipment 870,384.99 995 3. Payments made on account and assets under construction 1,830,625.86 195 C. Liabilities 4,955,646.85 (3,125) 1. Bonds 40,000,000.00 40,383 III. Financial assets 2. Liabilities to banks 9,953,715.29 19,933 Cooperative shares 1,354.00 0 3. Trade payables 4,837,820.96 4,923 112,082,749.04 (20,901) 4. Payables relating to player transfers 68,430,861.79 3,448 5. Other liabilities 18,447,217.63 22,933 B. Current assets 141,669,615.67 (91,620) I. Inventories Goods 985,366.79 1,335 II. Receivables and other assets D. Deferred income 13,807,485.81 22,524 1. Trade receivables 2,393,862.11 2,523 2. Receivables relating to player transfers 567,648.01 21,805 3. Receivables from companies in which investments are held 2,635,959.53 2,813 4. Other assets 11,594,054.62 692 17191524.27 (27,833) III. Cash on hand, bank balances and cheques 55,887,289.45 77,842 74,064,180.51 (107,010) C. Prepaid expenses 10,169,986.15 5,483 196,316,915.70 133,394 196,316,915.70 133,394 Appendix 2. Hertha BSC GmbH & Co. Kommanditgesellschaft auf Aktien (KGaA), Berlin C O N S O L I D A T E D I N C O M E S T A T E M E N T for the Financial Year from 1 July 2019 to 30 June 2020 [German Commercial Code (HGB)] Prior year € € in thousand € 1. Sales revenue 112,960,063.94 139,762 2. Other operating income 1,583,509.56 1,019 114,543,573.50 140,781 3. Cost of materials Cost of merchandise purchased -2,608,430.45 -2,814 4. Personnel expenses a) Wages and salaries -76,535,714.33 -59,534 b) Social security contributions and expenses for pensions and other benefits -3,654,270.94 -2,868 -80,189,985.27 (-62,402) 5. Amortisation of intangible assets and depreciation of tangible fixed assets -21,428,867.98 -9,730 6. Other operating expenses -58,500,326.70 -82,923 -48,184,036.90 -17,088 7. Other interest and similar income 127,355.86 52 - thereof from affiliated companies: € 125,187.22 (prior year: € 52 thousand) 8. Interest and similar expenses -4,913,148.90 -6,316 9. Remuneration for profit participation rights -471,668.67 -2,730 10. Taxes on income 0.00 62 11. Earnings after taxes -53,441,498.61 -26,020 12. Other taxes -19,424.43 -12 13. Consolidated net loss for the period -53,460,923.04 -26,032 Hertha BSC GmbH & Co. KGaA, Berlin Appendix 3./Page 1 Notes to the consolidated financial statements 1 July 2019 – 30 June 2020 Hertha BSC GmbH & Co. Kommanditgesellschaft auf Aktien (KGaA) Hanns-Braun-Strasse, Friesenhaus II, 14053 Berlin District Court of Berlin-Charlottenburg, HRB 84666 Notes to the Consolidated Financial Statements for the Financial Year from 1 July 2019 to 30 June 2020 Contents of the Notes to the Consolidated Financial Statements Page I. General information on the consolidated financial statements and the reporting date for the consolidated financial statements 2 II. Information on the group of entities consolidated 2 III. Disclosure of the consolidation methods applied 3 IV. Accounting and valuation principles 3 V. Notes on individual items in the consolidated financial statements for the financial year from 1 July 2019 to 30 June 2020 4 VI. Other disclosures 9 Appendix to the Notes to the Consolidated Financial Statements: Fixed asset schedule of player registrations as at 30 June 2020 (consolidated fixed asset schedule) Hertha BSC GmbH & Co. KGaA, Berlin Appendix 3./Page 2 Notes to the consolidated financial statements 1 July 2019 – 30 June 2020 I. General information on the consolidated financial statements and the reporting date for the consolidated financial statements The consolidated financial statements as at 30 June 2020 were prepared in accordance with the rules and regulations of the Third Book of the German Commercial Code [Han- delsgesetzbuch (HGB)] for large corporations in association with the Fifth Section of the First Book of the Stock Corporation Act [Aktiengesetz (AktG)]. The prior year figures are indicated for the purpose of comparison. For the purpose of clarity, the explanatory notes concerning the balance sheet and the income statement items, as well as the explanations that may be presented in either the balance sheet, the income statement or the notes, have all been presented in the notes to the annual financial statements. In accordance with Section 265 (5) HGB, classification items specific to the Company (player registrations as intangible fixed assets, receivables from transfers and liabilities for transfers or trade receivables and trade payables) have been disclosed on the balance sheet and in the fixed asset schedule. In addition, in order to improve the presentation of the results of operations, expenses from gaming operations and health care totalling € 1,254 thousand were not reported under other operating expenses as in the prior year, but instead under cost of materials. The prior-year figures were also adjusted accordingly by € 1,019 thousand. The income statement was prepared using the total cost method in accordance with Sec- tion 275 (2) HGB. II. Information on the group of entities consolidated Disclosures on the names and legal seats of companies included in the consolidation Name, legal seat Shareholding in % Hertha BSC GmbH & Co. Kommanditgesellschaft auf Aktien (KGaA), Berlin (parent company) Hertha BSC Rechte GmbH & Co. KG, Berlin *) 100 Hertha BSC Lizenz GmbH, Berlin *) 100 Hertha BSC Transfer GmbH & Co. KG, Berlin *) 100 Hertha BSC Infrastruktur GmbH, Berlin 100 Hertha BSC Medien GmbH, Berlin*) 100 Hertha BSC Stadion GmbH, Berlin 100 *) The company has a reporting date that differs from the reporting date for the consolidated financial state- ments and has been consolidated in the consolidated financial statements on the basis of the separate interim financial statements prepared. Hertha BSC GmbH & Co. KGaA, Berlin Appendix 3./Page 3 Notes to the consolidated financial statements 1 July 2019 – 30 June 2020 III. Disclosure of the consolidation methods applied 1. Capital consolidation The book value method (Section 301 (1) No. 1 HGB) was applied for consolidating capital (full consolidation). The shareholdings of the parent company were offset against the pro rata equity of the subsidiaries (pursuant to Section 301 (2) sentence 1 HGB) on the basis of the book values as at 30 June 2010, the point in time the subsidiaries were initially consolidated (if acquired at a later point in time, then the point in time of the respective inclusion in the consolidated financial statements). 2. Debt consolidation Debts were consolidated in accordance with Section 303 (1) HGB by eliminating inter- company receivables with the respective intercompany liabilities of the entities included in the consolidated financial statements. No offset differences resulted. 3. Revenue and expense consolidation Revenue and expenses were consolidated by applying Section 305 (1) HGB by offsetting intercompany revenue and intercompany operating income shown in other operating in- come of the entities consolidated with the expenses allocated to them. This same proce- dure was also applied to other interest and similar income, which were offset against the respective expenses. The transfers of profit or loss based on the terms of the existing profit transfer agreements as well as the portion of the profit generated by Group partnerships were eliminated.