Letter to shareholders concerning the first nine months of 2006

Essen, 29. November 2006

Dear Partners, dear Sir/Madam,

With sales of EUR 734.3 million (+55 percent; 2005: EUR 473.4 million) and consolidated earnings after taxes amounting to EUR 15.2 million (+28 percent; 2005: EUR 11.9 million), the GFKL Group’s results after the first nine months of the business year exceeded original expectations.

Sales in the individual business segments developed as follows:

^{* Earnings before taxes}

Results in the segments generally developed positively. All four segments are profitable and have made a considerably more balanced contribution to the good level of consolidated earnings than in the previous year.

I would like to make some remarks about the result in the Credit division. Here, the result decreased compared to last year’s nine-month period for two reasons: First, we had – as planned – to bear the start-up costs for expanding the leasing business in Britain, which amount to approximately EUR 1.85 million as of September 30, 2006. But, as I have already indicated in my earlier letters, this is typical for leasing. As soon as the coming year – i.e. the third year of business activity – we will generate sales of more than EUR 150 million in Britain, thus putting our figures well in the black. Second, last year’s result included an extraordinary income of EUR 5.7 million. Adjusted for this special effect, our leasing business in Germany showed a pleasing rise in income.

We have exploited the favorable capital market situation of the last 12 months and made considerable increases in our inventory of medium-term loans. We have used the funds thus flowing to us to reinforce our organic growth – e.g. in England – and to make a number of acquisitions in Germany and abroad. We have considerably improved our market position, particularly in the Collection division, and doubled our earnings compared to the previous year. Through the purchase of two profitable medium-sized collection companies in recent weeks and the expansion of activities in the credit-management business field, we have set the course for further earnings growth in 2007.

GFKL has achieved a lot during the current business year so far, and is therefore looking forward to the final spurt of the business year with motivation and additional incentive. Despite all concentration on operational business, we have not lost sight of the company’s superordinate strategic target: the initial public offering of the GFKL Group.

Yours faithfully,

Dr. Peter Jänsch
GFKL Financial Services AG

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