Notes

Explanatory notes; changes in the legal Group and organisational structure

The interim report of 30 September 2008 is prepared in accordance with the International Financial Reporting Standards (IFRSs) as well as the interpretations of the International Financial Reporting Interpretations Committee (IFRIC), insofar as those have been recognised by the European Union. The report is prepared as abridged financial statements with selected explanatory notes as stipulated by IAS 34. The accounting and valuation principles of this interim report correspond to those of the consolidated financial statements as at 31 December 2007. The legal Group and organisational structure presented in the Financial Report 2007 changed only slightly as of 30 September 2008: As was already explained in the Financial Report, the Waste Management and Recycling business segment was grouped together with the service activities bundled in the Services and Trading business segment and the new entity was given the name “Complementary Business Segments”. In this context, K+S Consulting GmbH was deconsolidated. In addition, our IT subsidiary data process GmbH was renamed IT Services GmbH and since 1 January 2008 has been presented in the reconciliation due to the low level of third-party revenues. After we sold biodata ANALYTIK GmbH in September 2007, this company is also no longer a consolidated part of the K+S Group. The company K+S Argentina SRL was included in the scope of consolidation during the first quarter due to increased business activities. In 2009, the reorganisation of the business with nitrogenous fertilizers at COMPO and fertiva will also result in corresponding changes in the legal Group and corporate structure.

There were no changes in the composition and the responsibilities of the Board of Executive Directors and the Supervisory Board as described in the Financial Report 2007.

Seasonal factors

There are seasonal differences over the course of the year that affect sales of fertilizers and salt products. In the case of fertilizers, we generally attain our highest sales in the first half of the year because of the use of fertilizers in Europe during the spring. This effect can either be enhanced or diminished by overseas sales. Sales of salt products – especially of de-icing salt – largely depend on winter weather conditions during the first and fourth quarters. In the aggregate, both these effects mean that revenues and earnings are generally greatest during the first half of the year. To improve the forecast quality by eliminating seasonal effects, the figures for the last twelve months (LTM) can be compared with the previous year’s figures (see left table).

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