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Annual Report for the Short Financial Year from 1 October 2012 until 31 December 2012

We Can Handle It.

DemagCranesAG

AnnualReportfortheshortfinancialyear1October2012to31December2012

TableofContents
CEOLettertotheShareholders ReportoftheSupervisoryBoard Productsataglance Managementreport Businessandenvironment BusinessperformanceoftheDemagCranesGroupanditssegmentsin financialyear2011/2012 BusinessperformanceoftheGroupanditssegments DemagCranesGroupfinancialreview DemagCranesAGfinancialreview Developmentofnonfinancialsuccessfactors Riskreport Reportonpostbalancesheetdateevents Forecastreport ConsolidatedFinancialStatements Statementofcomprehensiveincome Statementoffinancialposition Statementofchangesinequity Statementofcashflow NotestotheConsolidatedFinancialStatements NotestotheStatementofcomprehensiveincome NotestotheStatementoffinancialposition Otherdisclosures Responsibilitystatement Auditorsreport Publishersnote 2 3 6 8 10 29 32 35 40 43 45 52 53 56 59 60 62 63 64 87 90 114 144 145 147

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CEOLe ettertoth heShareho olders


DearSha areholders, Thisrepo ortforthesh hortfinancia alyear2012m marksafurtherstepintheintegratio onofDemag gCranes intotheTerexGroup p.Bringingourfinancialy yearintoline ewiththatofTerexhasr resultedinaonce ortfinancialyear, y from1October201 12to31Dece ember2012. onlysho andebtcrisis,low Theecon nomicenviro onmentinau utumnandw winterwasdo ominatedby ytheEuropea willingne esstoinvestandfierceprice p compet titioninthemarkets. m This smadeitself ffeltintheMaterial M Handling gsegment,which w bringstogetherou rcraneandcomponentmanufacturiingoperation nswith ourservicesactivitie es. Whileth heTerexPort tSolutionsse egmentsaw relativelystabledemand ddespitewe eakeninggro owth ownduetoaccustomed impetus, ,revenuewa asnonethele essslightlydo a variationin theprojectbusiness. Formore eonthattop pic,pleasetu urntopage2 29onwardsin i thisreport t. Asyoum mayhaverea adinthepress,Iamgoin ngtostepdownasCEOin nthecourse ofthisyear. .Itwas myaimt tofacilitateand a advance easeffective elyaspossibletheintegra ationofDem magCranesin ntothe TerexGr roupforthesuccessfuldevelopment oftheComp panyandthe ebusinessas swellasinth hebest interests softhework kforce.Dema agCranesha asafirmplac ceatTerexastheMateriialHandling&Port Solutionssegmentand,fromthe eoutset,isth hesecondbi iggestsegme entwithaon nefifthshare eof magbrandha asafuturea safamilybrand b intheTerexGroup p.InPortSolutions Terexsales.TheDem t,wemanagenotonlyou urownport activitiesundertheTere exGottwald dbrand,butalsothe segment portacti ivitiesthatwere w previouslyalreadyp partoftheTe erexGroup.DemagCran esisthusinplacefor alasting gfuturewithi intheTerexGroup. Iwouldl liketothank kallteamme embersofTe erexMaterialHandling&PortSolutio onsfortheirongoing supportandgreatde edication.Icould c nothav vedonemyjob j withoutthem. t Yourssin ncerely, AloysiusRauen CEO

DemagCranesAG

AnnualReportfortheshortfinancialyear1October2012to31December2012

ReportoftheSupervisoryBoard
During the course of the short financial year 1 October 2012 to 31 December 2012, the Supervisory Board of Demag Cranes AG fulfilled its obligations as required by law, the Articles of Association and theRulesofProcedureandadvisedtheManagementBoardinitsmanagementoftheCompany. Forthepurposeofmonitoringtheexecutivemanagement,theSupervisoryBoarddealtregularlyand indetailwiththecurrentpositionoftheCompanyandthefurtherdevelopmentoftheDemagCranes Group. The Management Board provided the Supervisory Board with regular, prompt and comprehensive information in verbal or written form, in particular on the course of business and business development in the individual segments, the position of the Company and the Group, proposed business policies, corporate planning and strategy, the profitability of the Company, risk management and compliance. In the event of matters and decisions of fundamental importance to the Company, the Management Board involved the Supervisory Board in advance. If a transaction or action by the Management Board required the approval of the Supervisory Board, it was presented bytheManagementBoardinthepropermanneranddecideduponbytheSupervisoryBoard. In my capacity as Chairman of the Supervisory Board, I regularly discussed issues related to the Companysstrategy,planning,businessdevelopment,riskposition,riskmanagementandcompliance with the Management Board, particularly the Chairman of the Management Board, also outside the Supervisory Board meetings. Thus, I always learned immediately of any events that could be of significanceforevaluatingtheGroupspositionandprospects. In addition, the committee chairmen briefed the Supervisory Board meetings on the work being carriedoutbytheindividualcommittees. TheSupervisoryBoardmetonceintheshortfinancialyear1October2012to31December2012,on 29November2012. There were no conflicts of interest involving members of the Management or Supervisory Boards in the short financial year 1 October 2012 to 31 December 2012. Further information can be found in theCorporateGovernanceReport. Activitiesandmeetingsofthecommittees The Supervisory Board has formed a total of four committees. In addition to the Mediation Committee, whose formation is required by Section 27 (3) of the German Codetermination Act (MitbestG), there is the General Committee, the Audit Committee and the Nominations Committee. The committees primarily prepare topics and resolutions for meetings of the full Supervisory Board. In some cases, they also have decisionmaking powers transferred to them, insofar as the law permits, by the Supervisory Board. With the exception of the Nominations Committee, the committees each have four members, of whom two are employee representatives and two are shareholder representatives. The Nominations Committee comprises all six shareholder representativesontheSupervisoryBoard. Specifically, the General Committee prepares the personnelrelated decisions of the Supervisory Board, the terms of Management Board members employment contracts including their remuneration, the appointment and dismissal of Management Board members and the nomination

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oftheChairmanofthe ManagementBoard.Thesolemeeting ofthe GeneralCommitteein theshort financialyear1October2012to31December2012tookplaceon28November2012. The Audit Committee prepares the Supervisory Boards decision on the adoption of the Financial Statements and the approval of the Consolidated Financial Statements. To this end, it is responsible for conducting the preliminary review of the Financial Statements, the Consolidated Financial Statements and the combined Management Report, checking the independence of the auditors and the services additionally provided by the auditors, engaging the auditors, specifying the points on whichthe audit should focus and agreeing the auditors fee. The Audit Committee also discusses the halfyearly financial report with the Management Board prior to its publication and deals, in particular, with overseeing the financial reporting process, the effectiveness of the internal control system and the internal audit system as well as compliance. In addition, the Audit Committee assists the Supervisory Board in monitoring the executive management. The sole meeting of the Audit Committee in the short financial year 1 October 2012 to 31 December 2012 took place on 28November 2012. The Chairman of the Audit Committee has at no time been a member of the Companys Management Board, is independent and, as a result of his education and professional experience,hasappropriateaccountingandauditingexpertise. TheNominationsCommitteedidnotmeetintheshortfinancialyear1October2012to31December 2012. There was no reason in the short financial year 1 October 2012 to 31 December 2012 to convene a meetingoftheMediationCommitteepursuanttoSection27(3)oftheGermanCodeterminationAct (MitbestG). AuditoftheFinancialStatementsandConsolidatedFinancialStatements On29August2012,theextraordinaryGeneralMeetingresolvedtoappointPricewaterhouseCoopers AG, Wirtschaftsprfungsgesellschaft, Dsseldorf, as auditors of the Financial Statements and Consolidated Financial Statements for the short financial year 1 October 2012 to 31 December 2012. The Supervisory Board accordingly engaged PricewaterhouseCoopers AG, Wirtschaftsprfungsgesellschaft, Dsseldorf, as auditors for the financial year 1 October 2012 to 31December 2012, concluded the agreements regarding the auditors fee and followed the Audit Committeesrecommendationsinspecifyingthepointsonwhichauditactivitiesshouldfocus. The audit of the Financial Statements and Consolidated Financial Statements for the short financial year 1 October 2012 to 31 December 2012 focused on the following: Presentation and deferral of revenue, notably when using the percentageofcompletion method; the impact on earnings of the over or undervaluation of assets, an excess or shortfall of provisions and estimated amounts in the accounts (management override of controls); recoverability of assets (incl. goodwill), including note disclosures and clear documentation (plausibility of assumptions used to calculate recoverable amount, including replacement cost of capital); accounting for definedbenefit obligations; reporting onopportunitiesandrisksintheGroupmanagementreport. PricewaterhouseCoopers AG, Wirtschaftsprfungsgesellschaft, Dsseldorf, audited and issued an unqualified audit opinion on the Financial Statements and Consolidated Financial Statements prepared by the Management Board for the short financial year from 1 October 2012 to 31December 2012. The financial statement documents and the auditors audit reports were submittedtoallmembersoftheSupervisoryBoardingoodtime.AttheAuditCommitteemeetingof

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25March2013andthe t SupervisoryBoardm meetingof26 6March2013 3,thedocum mentswerediscussed d mined in det tail in the pr resence of t he auditors. At both me eetings, the a auditors rep ported on and exam red question the mate erial findings of their au udits, answer ns and were available to o provide any further informat tion. In doing so, the aud ditors confir rmed that no o material weaknesses h had been identified in the internal control and risk ma anagement s system in relation to the e financial re eporting pro ocess and that the ere were no o circumstan nces that w would call in nto question n the audito ors impartia ality. The auditors also report ted that, in addition to o performing the financial stateme ent audits, they t had provided d auditrelated services amounting a t to EUR 81,00 00 and other r services am mounting to EUR 0 in amined the Financial the shor rt financial year y 1 October to 31 Dec cember 2012. Having thoroughly exa Stateme entsandConsolidatedFin nancialState ementsaswe ellasthecom mbinedMan nagementRe eport,the Supervis sory Board approved a the e findings of f the audito ors audit. It did not rais se any objec ctions on completion of its examination e . The Super rvisory Boar rd approved d the Financ cial Stateme ents and Consolid dated Financial Statemen nts for the sh hort financia al year 1 October 2012 to o 31 December 2012 inaccord dancewiththeAuditCom mmitteesre ecommendat tionandado optedthem. CorporateGovernan nce hortfinancialyear1Octo ober2012to o31December2012,theSupervisory Boardagain ndevoted Inthesh corporate governance. Pursuant to consider rable attenti ion to the Companys C c o Clause 3.1 10 of the German Corporate Governance Code of 15 5 May 2012 2, the Management and d Supervisory Boards report o on corporate e governanc ce within th he Demag Cranes C Group in the Co orporate Gov vernance Reportin nconnection nwiththeStatementon CorporateGovernance. G The Supervisory Boa ard would lik ke to expres ss its thanks and recognition to the Managemen nt Board, the emp ployees and the employee represen ntatives of all Group member compa anies and as ssociated iesfortheirwork compani w intheshort s financiialyear1October2012to t 31Decem mber2012. Dsseldo orf,26March2013 TheSupe ervisoryBoard haelW.Ernes stus Dr.Mich Chairman

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Produc ctsatagla ance

Comprehe ensiveproductportfolio DemagCra anessuppliescranesystemsfo oralmostevery y sectorofindustry,fromgeneral g purposecranesconsis sting ofstandar rdisedmodulestoprocesscran nestailoredto customers sspecificproce essesincludingfullyautomat ted cranesolu utionsfeaturing gourwarehousemanagement t systemde evelopedinhou use.

Modu ularsystems Themarket m andtechnologyleaderiinlightcranesy ystems foralm mostfivedecad des.Themodula arKBKlightcra ane system mforcapacities supto3.2tonn nesissuitablefor implementingindivid dualergonomic cworkplacesas swellas compl leteintralogisticssolutions.

Mobilean nduniversal Maximummobilityforun niversalandspe ecialcargo terminals:MobileHarbou urCranesandderivative d crane e typesfrom mDemagCrane esensureefficie enthandlingof bulk containers s,unitloadsand dprojectcargo o.Witharound 1,400 MobileHa arbourCranessold, s weconside erourselvesthe e worldmar rketleader.

Effectiveandefficien nt Autom matedGuidedVehicles V (AGVs) withtheirsophisticated manag gementandnavigationsoftwa arearetheesse enceof efficie entcontainerha andling.Thede evelopmentofbattery b power reddrivesystem msforAGVs(Ba atteryAGVs)no owmeans operatorscanimplem mentzeroexha austemissionte erminals.

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Singlesou urce Fromcomponentstosyst tems:theexten nsive,modular DemagCra anesproductra angekeepsthin ngsmoving. Alongsidecranesforconv ventionalneeds,countless application nscallforacus stomsolution,implementedw with Demagdri ivetechnology. .

Globa alservice Servic cemadetomea asurefromreg gularservicingto compl leteoverhaulskeepscustom merscranesupand runnin ng.TheDemagCranesnetwor rkisamongthebiggest intheindustry,providingfulllifecy ycleserviceforboth Demagandthirdpar rtycranes.

Efficientst torage AutomatedStackingCran nes(ASCs)from mDemagCranes s allowfully yautomatedma anagementofcontainer c yards sand connectw watersideandla andsideequipm mentsuchasshiipto shorecran nes,terminaltransportvehicle esandtrucks.In nthe yardarea,ASCsensurehighdensitystorage,efficient sortingandshortaccesstimes. t

Maint tainingvalue Securi ingmaximumavailability a and productivitywh hile maintainingthevalueofourcustom mersinvestmen ntsisour maxim mforcustomerfocusedservice eandtargetedproduct trainin ng.Highlyskilled,seasonedsp pecialistsensure e custom mersdrawmax ximumlongterm mbenefitfrom mourhigh perfor rmanceequipm ment.

DemagCranesAG

AnnualReportfortheshortfinancialyear1October2012to31December2012

CombinedGroupManagementReportand ManagementReportofDemagCranesAG
Fortheshortfinancialyear From1October2012to31December2012

DemagCranesAG

AnnualReportfortheshortfinancialyear1October2012to31December2012

Tableofcontents
Businessandenvironment................................................................................................10
Groupstructureandbusinessactivities................................................................................................................ 10 Organisationandlocations...................................................................................................................................14 Managementstructure.........................................................................................................................................15 Groupmanagement..............................................................................................................................................15 StatementoncorporategovernanceunderSection289aoftheGermanCommercialCode..............................15 Corporategovernancereport............................................................................................................................... 15 Remunerationreport............................................................................................................................................15 DisclosuresunderSections289(4)and315(4)oftheGermanCommercialCodeandexplanatoryreporton thesedisclosuresbytheManagementBoardofDemagCranesAG .....................................................................20 Generaleconomicenvironment........................................................................................................................... 27 Effectsoftheeconomicenvironmentonbusinessperformance.........................................................................28

BusinessperformanceoftheDemagCranesGroupanditssegmentsintheshortfinancial yearfrom1October2012to31December2012...............................................................29
TakeoverbyTerexandintegrationintotheTerexGroup..................................................................................... 29 DemagCranesAGshares......................................................................................................................................30

BusinessperformanceoftheGroupanditssegments .......................................................32 DemagCranesGroupfinancialreview..............................................................................35


DemagCranesGroupearnings............................................................................................................................. 35 DemagCranesGroupcashflows.......................................................................................................................... 37 DemagCranesGroupfinancialposition................................................................................................................ 39

DemagCranesAGfinancialreview....................................................................................40
DemagCranesAGearnings...................................................................................................................................40 DemagCranesAGcashflowsandbalancesheet .................................................................................................. 41

Developmentofnonfinancialsuccessfactors..................................................................43
Employees.............................................................................................................................................................43 Procurementandpurchasing................................................................................................................................43 Researchanddevelopment..................................................................................................................................44 Environmentandoccupationalsafety.................................................................................................................. 44

Riskreport........................................................................................................................45
Riskmanagementsystem.....................................................................................................................................45 Opportunitymanagement....................................................................................................................................45 Significantindividualrisks.....................................................................................................................................45 Assessmentoftherisksituationandchangeintheriskpositionsincefinancialyear2011/2012.......................49 DisclosuresunderSection289(5)andSection315(2)5oftheGermanCommercialCode(mainfeaturesofthe internalcontrolsystemandoftheriskmanagementsysteminrelationtothefinancialreportingprocess)and explanatoryreportonthesedisclosuresbytheManagementBoardofDemagCranesAG................................50

Reportonpostbalancesheetdateevents........................................................................52 Forecastreport.................................................................................................................53
Introduction..........................................................................................................................................................53 BusinessoutlookfortheDemagCranesGroup.................................................................................................... 54

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Foreword
The Consolidated Financial Statements of Demag Cranes AG on which this report is based were preparedinaccordancewiththeInternationalFinancialReportingStandards (IFRS)asadoptedin the EU. Demag Cranes AG is the parent company of the Demag Cranes Group. It continues after the majoritytakeoverbyTerextoperformtheusualfunctionsofamanagementholdingcompanyaswell as assuming responsibility for operational management. In this capacity, the Company manages and administers its Group member companies and associated companies. During the past financial year, in the course of its ordinary operating activities, Demag Cranes AG provided services in its shared services function relating to Financial Controlling, Finances and Accounting, Group Accounting, IT, Strategic Purchasing, Human Resources, Corporate Strategy, Corporate Communication & Marketing andLanguageServices.ThepositionandfuturedevelopmentofDemagCranesAGdependmainlyon the business success of the Demag Cranes Group. The Separate Company Financial Statements of Demag Cranes AG, on which this Combined Management Report is also based, were prepared in accordance with the provisions of the German Commercial Code (HGB) and the German Stock CorporationsAct(AktG). The Demag Cranes Group and Demag Cranes AG Combined Management Report are prepared in euros, the functional currency of Demag Cranes AG. All figures are rounded to the nearest million euros unless otherwise stated. All percentages relate to figures stated to the nearest euro. The amount shown for each individual item and total is the figure with the smallest rounding difference. Reportedtotalsmaythereforedifferslightlyfromthesumoftheindividualreportedamounts.

Businessandenvironment
Groupstructureandbusinessactivities
Demag Cranes forms the core of Material Handling & Port Solutions segment of the Terex Corporation.InthecourseofitsintegrationintotheTerexgroup,DemagCranesnolongerintendsto report in future to the capital market on its three segments Industrial Cranes, Port Technology and Services. In line with the new organisation within Terex, the business activities of the Industrial Cranes and Services segments will be grouped under Material Handling while those of the Demag Port Technology segment, the Terex Port Equipment business as well as the Terex Reach Stacker businessinMontceaulesMineswillbepartofPortSolutionsinthefuture.TheTerexPortEquipment businessandtheReachStackerbusinessinMontceauLesMineswill,however,notbeincludedinthe Consolidated Financial Statements of Demag Cranes. The former entities of Demag Cranes that have been sold to Terex are included in the Financial Statements until the date of sale. As a result, figures reportedintheFinancialStatementsof TerexCorporationforthe MaterialHandling&Port Solutions segment will thus not be comparable with those in the Consolidated Financial Statement of Demag Cranes.

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TEREX
MaterialHandling&PortSolutions

DemagCranes
MaterialHandling&PortSolutions

PortSolutions MaterialHandling
(IndustrialCranes& Services) (PortTechnology& TerexPort Equipment,Terex reachstacker business)

MaterialHandling
(IndustrialCranes& Services)

PortSolutions
(PortTechnology)

Demag Cranes AG has its registered office in Dsseldorf and is the parent company of the Demag Cranes Group. As at 31 December 2012, it directly held 100% of the shares in DCC HoldCo 4 (vier) GmbH and Gottwald HoldCo 3 (drei) GmbH and indirectly held interests in numerous other companies inside and outside Germany. For details on our subsidiaries, joint ventures and investments, see also the Notes to the Consolidated Financial Statements under Note 44 (Subsidiaries, joint ventures and investments as at 31 December 2012). Since 16 August 2011, the TerexGrouphasheldamajorityshareinDemagCranes. The Demag Cranes Group manufactures products in the industrial cranes, crane components, harbourcranesandterminalautomationtechnologysectors.Itproducesinatotalof16countrieson five continents and, through subsidiaries, agencies and joint ventures, operates an extensive sales andservicenetworklinkingmorethan220servicelocationsinover60countries. As shown in the chart below, at 31 December 2012, the business activities of the Demag Cranes Groupweredividedintotwosegments:MaterialHandling&PortSolutions.Thissegmentationisalso thebasisofGroupmanagementandsupervision. DemagCranesbuiltontwopillars

DemagCranes
MaterialHandling&PortSolutions

MaterialHandling

PortSolutions

(IndustrialCranes&Services)

(PortTechnology)

Shareofrevenue:73.7% Installedbase:>600,000

Shareofrevenue:26.3% Around1,500MHCsold

Orderintake:223.0Mio.EUR

ShortFinancialYearkeyfigures Revenue:227.1Mio.EUR Oper.EBIT:4.1Mio.EUR

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MaterialHandlingproductsandmarkets Productportfolio
Newbusiness: StandardCranes ProcessCranes Craneconstructionkit Ropeandchainhoists Travelunit components Switchandcontrol systems Gearedmotors& drives Loadhandling attachments Cranecomponents Services: Craneinspectionsand safetychecks, maintenanceand repairs Spareparts Upgradesand refurbishment Underthehook services

Endmarkets
Newbusiness: General manufacturing Engineering companies Pulp&paper producers Steelmaking companies Shipbuilders Energyutilities Storage&logistics Automotiveindustry Wastesector Mechanical engineeringindustry Services: Craneoperators worldwide(Demag cranesandNon Demagcranes)

Marketposition
Newbusiness: Excellentpositioning intechnologically advancedandhigh qualityproduct segments Services: Marketleader regardinginstalled baseofmorethan 660,000cranesand hoists Servicenetworkwith morethan220service centers

Competitors
Newbusiness: KonecranesPlc. ColumbusMcKinnon Corporation ABUS KitoCorporation Services: Inhouseservice departmentsof customers Localservice providers Othercrane manufacturers Industrialservice providers

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PortSolutionsproductsandmarkets Productportfolio
MobileHarbourCranes AutomatedGuidedVehicles AutomatedStackingCranes WideSpanGantries Turnkeyprojectsforports& intermodalterminals Consultingandsoftware toolsforplanningand optimisingterminal operations Spareparts Service

Endmarkets
Largeport&terminal operators Smallmultifunctionalports Intermodalhandlingwithin inlandports Newterminalandgreen ports

Marketposition
#1inMobileHarbourCranes basedonmarketshareand installedbaseofabout1,500 cranessold Technologicalleaderin automatedporttechnology

Competitors
KonecranesPlc. Kalmar ZPMCCo.Ltd. LiebherrInternationalAG

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Organisationandlocations
IntheMaterialHandlingsegment,cranegirdersareproducedandcranesareassembledat20plants in highvolume markets around the world. The components required for the production of industrial cranes are supplied by our own two component plants in Wetter an der Ruhr (Germany) and Uslar (Germany) as well as four plants that manufacture cranes and components located in So Paulo (Brazil),Chakan(India),Slan(CzechRepublic)andShanghai(China).Sevenofthe20craneplantsare operated by MHEDemag (S) Pte Ltd., Singapore, a 50/50 joint venture between Demag Cranes & Components GmbH, Wetter, and Jebsen & Jessen (SEA) Pte Ltd., Singapore. In smaller markets, the Group works together with crane manufacturing partners and provides them with our own components and productionrelated engineering services. This gives us broad geographical coverage and operational flexibility. Crane girders produced by local partners are then locally assembled with Demag components to create cranes in line with our quality requirements. This allows us to plan productioncapacities betterand tousethemmore profitably.Theproduct developmentactivitiesof the Material Handling segment targeting emerging markets are increasingly being relocated to these regions. In Pune (India) and Shanghai (China), for example, development centres have been established for industrial crane and port technology products. This creates indepth product expertisetailoredtothesespecificmarkets.InAugust2012,DemagCranessignedtheagreementsto launch a joint venture with Weihua, one of Chinas largest crane builders. The company, Demag Weihua (Liaoning) Material Handling Machinery Co. Ltd., is included as a subsidiary in the Consolidated Financial Statements of Demag Cranes AG and will be responsible for the development andproductionofcomponentsandpartsforcranesandhoistsinthemidmarketsegment. The Demag Cranes Group operates one of the largest crane and lifting equipment service networks on the market. The largest installed base in the world numbering over 660,000 Demag cranes and electric hoists is served by more than 220 service centres worldwide. Our service sales team actively approachescustomersandourservicesareprovidedbyourown,qualifiedstaff. ThesparepartsbusinessisincreasinglybeingconductedviaourwebbasedDemagShopsystem.This gives customers direct access to Demag spare parts and components as well as to automated, cost effective business processes with a direct link to the central spare parts logistics system and production. Repair centres for general overhauls and repairs to crane components are available globally. A centrally organised competence centre provides development services for complex crane refurbishmentprojects. ProductionaswellasthetechnicalareasofthePortSolutionssegmentarelocatedattheDsseldorf plant,withengineeringandresearchaswellasdevelopmentactivitiesalsobasedinthedevelopment centre in Pune (India). Both our main market in Europe and our international customers are served centrally from Dsseldorf. Operations focus on the production of critical large components that determine product quality as well as on final assembly. We additionally draw on a worldwide network of suppliers and production partners. The cranes we produce are transported along the Rhine to the North Sea ports of Antwerp and Rotterdam and from there on to end customers. Worldwide sales and service in the Port Solutions segment are carried out by centrally based key account managers for international customers, but also regionally by Demag Cranes AGs regional subsidiaries,orbycontractualpartners.

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Managementstructure
The Management Board, as the executive body, holds responsibility for the segments. Ongoing Group management and reporting to the capital market and Supervisory Board are based on standardreporting. The sales organisation, through which the sale of our products and services is managed Groupwide, compriseslocalsalesandservicecompaniesaswellasapartnernetwork. The production network comprises our own strategically sited component factories in Germany, Brazil and China as well as local crane factories and partners, and ensures consistently top product qualityathighlevelsofefficiency.

Groupmanagement DemagCranesAGskeyperformanceindicatorsystem
Demag Cranes AG uses a performance indicator system based around a number of globally standardised and clearly structured key performance indicators (KPIs). The basis consists of IFRS figures adjusted as necessary in accordance with internal control needs. This includes adjusting for oneoffitems. The most important KPIs are as follows: cash generation (cash flow return on revenue), return on capital, return on sales, working capital as a percentage of revenue, order intake and order book as advancedindicatorsandfunctionalindicators. Among these key performance indicators, the profitability indicators play a special part as they essentially use operating net income, a central management indicator, as the target metric in the denominator. Indicators based on earnings before interest and tax (EBIT) and revenue are used as key measures of target attainment for all parts of the Group and also as the basis for calculating variablecompensation.

StatementoncorporategovernanceunderSection289aoftheGermanCommercialCode
The Statement on corporate governance is available for viewing online at www.demagcranes ag.com/statement_on_corporate_governance.

Corporategovernancereport
The Corporate governance report is available for viewing online at www.demagcranes ag.com/corporategovernance.

Remunerationreport
With regard to commercial law disclosure requirements, the following Remuneration Report also forms an integral part of the Notes to the Consolidated Financial Statements and Group ManagementReport.

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CompensationfortheManagementBoard
As at 31 December 2012, overall Management Board compensation normally comprises a fixed salary, a performancebased bonus, pension benefits and fringe benefits. Management Board member Lawrence Lockwood additionally participates in the Terex Corporation Long Term Incentive Plan. TheappropriatelevelofcompensationtobereceivedbymembersoftheManagementBoardoverall is determined by the full Supervisory Board at the proposal of the General Committee based on a performancereview. Aloysius Rauens contract as member of the Management Board ends on 30April 2017. Lawrence Lockwoods contract as a member of the Management Board ends on 31 December 2013. The components of Lawrence Lockwoods compensation and other benefits under his Management Boardcontractarepaid,forthetimebeing,byTerexCorporationandnormallyrefundedtothelatter byDemagCranesAGagainstinvoice. Nonperformancerelated compensation, oldage and surviving dependants pensions, and fringe benefits The nonperformancerelated component of Management Board compensation comprises basic compensationandfringebenefits. For the CEO, Aloysius Rauen, this includes vested pension benefits from his 65th birthday. The amountofthispensionisdeterminedbasedonthelengthofMrRauensserviceatDemagCranesAG and amounts to up to 40% of his final gross fixed salary. For the duration of his Management Board contract, Mr Lockwood is entitled to participate in the Terex retirement plan (401(k) plan), under which Terex pays a company contribution of 100% of the first five percent of Mr Lockwoods contributionsuptoamaximumofUSD12,500. TheManagementBoardcontractwithMrRauenalsoprovidesforasurvivingdependantspensionin the form of a lifelong widows pension. The widows pension amounts to 60% of the maximum retirementpension. Finally, members of the Management Board receive fringe benefits in the form of noncash compensation, primarily comprising insurance premiums (e.g. contributions to health and longterm care insurance, life and accident insurance), expenses (e.g. travel) and use of a company car. Certain additional fringe benefits apply specifically for Mr Lockwood including relocation and other costs arisingthroughhisrelocationtoGermanyfromtheUSA.Thesespecificfringebenefitsaremetinpart byDemagCranesAGandinpartbyTerexCorporation. There is also a directors and officers liability insurance (D&O) policy for members of the Management Board, which provides for a suitable deductible. For each claim, the members of the Management Board being claimed for personally meet 10% of the loss up to a maximum amount for all claims made within one year of 150% of the Management Board members fixed annual compensation(deductible).

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Performancerelatedcompensationandlongtermincentivecomponents The members of the Management Board are entitled to performancerelated compensation for the short financial year from 1 October 2012 to 31 December 2012 in the form of a bonus. The bonus consistsofatargetbonusandanadditionalbonus. The maximum target bonus for the threemonth reporting period is EUR 200,000 for the CEO, Mr Rauen, and USD 34,000 for the CFO, Mr Lockwood. The maximum additional bonus for the three monthreportingperiodisEUR110,000forMrRauenandUSD23,800forMrLockwood. The target bonus is linked to the attainment of targets defined by the Supervisory Board relating to operatingEBIT(50%weighting)andoperatingnetincomeaftertax(50%weighting).Ifthetargetsare attained in full, 100% of the target bonus is paid out. If the targets fail to be met by 20% or less, the bonus paid out is reduced accordingly on a straightline basis, with a final figure of 25% of the target bonus being reached if 80% of the target is met. If one of the targets fails to be met by more than 20%, there is no entitlement to the bonus, in which event the Supervisory Board decides at its own discretionwhethertograntabonusandtheamountofthebonus. The granting and size of the additional bonus depend on attainment of highly demanding targets set by the Supervisory Board for the key performance indicators of operating EBIT and operating net incomeaftertax. For Mr Rauen, two thirds of the target and additional bonuses for the first of three financial years is paidoutafterthefirstfinancialyear.Theremainingthirdisonlypaidoutafterthethirdfinancialyear ifandtotheextentthattherelevanttargetsforthesecondandthirdfinancialyearsareattained.For the target bonus, the amount of the remaining third to be paid out is calculated on the basis of the average target attainment for the second and third financial years. This twoyear average must be at least 80%, with the individual target attainment figures for the two years capped at a maximum of 100%. The average figure calculated in this way is multiplied by the as yet unpaid portion of the target bonus (one third)fromthefirstfinancialyear todeterminetheamount tobe paidforthefirst financial year. Just as for the target bonus, only two thirds of the additional bonus is paid out after the first financial year. The remaining third is paid out after the third financial year if and to the extent that the special targets for the additional bonus for the second and third financial years are attained,basedontheaverageattainmentoftargetsfortheadditionalbonus. The target bonus attained by Mr Rauen amounted to EUR 0 for the threemonth reporting period; theadditionalbonusamountedtoEUR0. The target bonus attained by Mr Lockwood amounted to EUR 0 for the threemonth reporting period; the additional bonus amounted to EUR 0. Irrespective of the above bonus arrangements, Mr Lockwood continues to participate (at the expense of Terex Corporation) in the Terex Long Term Incentive Plan. Under this plan, Terex Corporation has granted him longterm and shortterm incentive benefits (shares and cash) for which, by resolution of the Board of Directors of Terex Corporation, he will continue to be taken into consideration. The grant conditions for the incentive benefits are to correspond with those of the Terex Long Term Incentive Plan, which are laid down annuallybytheBoardofDirectorsofTerexCorporation. Terex Corporation also paid Mr Rauen a voluntary bonus of EUR 200,000 and Mr Lockwood a voluntary bonus of USD 17,112 with the approval of the Supervisory Board of Demag Cranes AG. As

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withtheadditionalbonusespromisedto(andattainedby)theotherexecutivesofDemagCranes,the voluntary bonuses for the Management Board members are honouring the special achievements in an economic climate that was becoming increasingly difficult over the 15 months prior to 31 December 2012, and the successful integration of Demag Cranes into the Terex Group after conclusionofthedomination&profitandlosstransferagreement. Management Board compensation for the short financial year from 1 October 2012 to 31 December2012 In total, members of the Management Board received compensation of EUR 656,000 in the short financialyearfrom1October2012to31December2012,includingnoncashcompensation. Thetablebelowprovidesanindividualbreakdownofthecompensationreceived:
Total compensation ShortFY2012 Total compensation FY2011/2012

Fixed compensation

inEURthousand AloysiusRauen Axel Arendt Lawrence Lockwood RainerBeaujean Total 138 0 137 0 275

Variable compensation Deferred, Paymentdue conditional payment shortterm 200 0 0 0 0 33 0 0 233 0

Other

4 0 144 0 148

342 0 314 0 656

1,095 586 611 138 2,430

Pensionsandsurvivingdependantspensions An expense of EUR 46,000 for pensions was recognised in accordance with IFRS for Mr Aloysius Rauen in the short financial year 2012 (2011/2012: EUR 138,000). The provision came to EUR 705,000at31December2012(30September2012:EUR622,000). The Consolidated Statement of Financial Position as at 31 December 2012 additionally included EUR 662,000 in pension provisions in accordance with IFRS for former members of the Management Board(30September2012:EUR588,000). An expense of EUR 23,000 for pensions was recognised in accordance with the German Commercial CodeforMrAloysiusRauenintheshortfinancialyear2012(2011/2012:EUR112,000).Theprovision cametoEUR459,000at31December2012(30September2012:EUR430,000). The Consolidated Statement of Financial Position as at 31 December 2012 additionally included EUR 329,000inpensionprovisionsinaccordancewiththeGermanCommercialCodeforformermembers oftheManagementBoard(30September2012:EUR324,000). ManagementBoardmemberLockwoodisentitledto participateintheTerexretirementplan (401(k) plan). The expense to be refunded in this connection by Demag Cranes AG to Terex Corporation amountedtoEUR0intheperiodunderreview.

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ArrangementsfortheeventofterminationofofficeofcurrentmembersoftheManagementBoard IftheappointmentofamemberoftheManagementBoardisprematurelyrevokedwithoutcausefor terminationoftheemploymentcontract: Mr Rauen receives by way of financial compensation his fixed salary for the originally planned contract term and a target bonus pro rata temporis to the end of his contract term, assuming 100%targetattainment,butnomorethantwotimeshistotalannualcompensation(severance cap). Mr Lockwood receives from Demag Cranes AG by way of financial compensation his fixed salary up to the end of a threemonth termination period from the end of the month the revocation of appointment comes into effect or the end of the contract term, whichever is the earlier, plus, pro rata temporis, all bonuses earned in the financial year the contract termination comes into effect. Moreover, he receives from Terex Corp. his fixed salary for two years (this is reduced to one year of fixed salary following the 2nd anniversary of his appointment to the Management Board), taking into account any payment of fixed salary by Demag Cranes AG, and continued vesting of his Terex longterm incentive awards and U.S. healthcarecontinuationduringtheseveranceperiod.

If the Company has good cause to terminate an employment contract without notice within the meaning of Section 626 of the German Civil Code (BGB), claims for compensation are excluded and theManagementBoardmemberconcerneddoesnotreceiveanybonuspayments,proratatemporis orotherwise,forthethencurrentfinancialyear. In the event of a change of control, Mr Rauen has the right to terminate his Management Board contract within six months at three months notice to the end of a month. A change of control is deemed to take place when either (i) a shareholder acquires control of the Company within the meaning of Section 29 of the German Securities Acquisition and Takeover Act (WpG) by holding at least 30% of the voting rights in the Company, including voting rights attributable to the shareholder underSection30WpG,or(ii)anintercompanyagreementwithinthemeaningofSection291ofthe German Stock Corporation Act (AktG) under which the Company is a dependent company is entered into and comes into force or (iii) the Company is merged with another legal entity pursuant to Section 2 of the German Transformation Act (UmwG), unless, based on the agreed exchange ratio, the value of the other legal entity is less than 50% of the value of the Company. If the special termination right is exercised, Mr Rauen receives by way of financial compensation the fixed salary uptotheplannedendofthecontracttermandatargetbonusproratatemporisuptotheendofthe contract term, assuming 100% target attainment, but no more than two times the total annual compensation(severancecap). SupervisoryBoardcompensation Supervisory Board compensation is governed by the Articles of Association of Demag Cranes AG. Contrary to Clause 5.4.6 of the German Corporate Governance Code as amended on 15 May 2012, members of the Supervisory Board of Demag Cranes AG only receive basic annual compensation of EUR 25,000; the Chairman of the Supervisory Board receives 2.5 times and each vice chairman receives 1.5 times that amount. Members of committees except for the Mediation Committee required under Section 27 (3) MitbestG and the Nominations Committee additionally receive 0.1 timestheirbasiccompensationforeachcommitteeonwhichtheysit.

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Chairmen of committees additionally receive 0.25 times their basic compensation; this does not applyto the Chairmanof the SupervisoryBoard,theChairmanof the MediationCommitteerequired under Section 27 (3) MitbestG or the Chairman of the Nominations Committee. In addition to their basic annual compensation, members of the Supervisory Board receive an attendance fee of EUR 1,500 for each Supervisory Board and committee meeting they attend, but no more than EUR 1,500 percalendarday.Reasonableoutofpocketexpensesarerefundedonpresentationofreceipts. FixedcompensationisstipulatedfortheSupervisoryBoardinviewoftheindependenceitmusthave tobeabletocarryoutitsmonitoringfunction.Theperformanceofthisfunctionshouldnotbetiedto anymonetaryincentives. ThecompensationforeachindividualmemberoftheSupervisoryBoardduringthethreemonth reportingperiodandthepriorfinancialyearbreaksdownasfollows:
SupervisoryBoardcompensation fromsubsidiaries Attendance Fixed fee compensation 2,268.49 500.00 1,512.33 500.00 1,512.33 500.00 1,512.33 500.00 1,512.33 500.00 8,317.81 2,500.00 Total compensation ShortFY2012 Total compensation FY2011/2012

DemagCranesAG inEUR Axel Arendt Josef Berger* GerdUweBoguslawski* Giuseppe Di Lisa Dr.Michael W.Ernestus HarryHansen* Dr.Michael Leue ReinhardMller* HubertRosenthal* OrenG.Shaffer SupervisoryBoardmemberswhosteppeddowninfinancial year2011/2012 Total Fixed compensation Attendance fee 6,301.37 1,500.00 9,178.08 3,000.00 6,301.37 1,500.00 6,301.37 1,500.00 15,753.42 3,000.00 6,301.37 1,500.00 6,301.37 1,500.00 7,835.62 1,500.00 7,561.64 3,000.00 7,876.71 3,000.00 79,712.32 21,000.00

7,801.37 14,946.58 9,813.70 7,801.37 18,753.42 9,813.70 7,801.37 11,347.95 12,573.97 10,876.71 111,530.14

19,972.60 77,000.00 44,500.00 14,979.45 86,500.00 47,000.00 40,000.00 47,500.00 58,500.00 49,250.00 43,746.57 528,948.62

*The empl oyee repres enta ti ves decl are tha ttheycontri bute the compens a ti on they recei ve forthei rwork on the Supervi s ory Board to the Hans Bckl er Founda ti on i n compl i ance wi th the pol i ci es l a i d down bythe Germa n Tra de Uni on Federa ti on (DGB)

SupervisoryBoardmembersKevinA.BarrandBrianJ.HenrywaivedtheirSupervisoryBoard compensationforthereportingperiod. NocompensationorbenefitsweregrantedforservicesrenderedbySupervisoryBoardmembers, includingforadvisoryandintermediationservices. Inaddition,theemployeerepresentativesontheSupervisoryBoardwhoareemployeesofthe DemagCranesGroupreceivedsalariesundertheiremploymentcontracts.Theamountsofthese salariesrepresentedappropriatecompensationfortheemployeesfunctionsandtaskswithinthe Group.

Disclosures under Sections 289 (4) and 315 (4) of the German Commercial Code and explanatoryreportonthesedisclosuresbytheManagementBoardofDemagCranesAG
Demag Cranes AG, the parent company of the Demag Cranes Group within the meaning of Section 290(1)oftheGermanCommercialCode,isanAktiengesellschaft(aGermanpubliclimitedcompany), hasitsregisteredofficeinDsseldorfandhasissuedvotingsharesthathavebeentradedintheEntry StandardsegmentoftheOpenMarketonFrankfurtStockExchangesince8March2013.

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Subscribedcapital;rightsandobligationsattachingtoshares
DemagCranesAGssubscribed capital(sharecapital) amounts toEUR21,172,993asat31December 2012 and is divided into 21,172,993 noparvalue bearer shares. There are no different classes of shares. Each share has one vote at general meetings. In all other respects, the rights and obligations attachingtoeachshareareasstipulatedintheGermanStockCorporationsAct(AktG).

Restrictionsonthetransferofsecuritiesandonvotingrights
Shares in Demag Cranes AG are not subject to any restrictions on voting rights under the Articles of Association or by law at the balance sheet date. No restrictions on voting rights resulting from agreementsbetweenshareholdersareknowntotheManagementBoard.

Holdingsrelatingtomorethan10%ofvotingrights
Terex Deutschland GmbH notified Demag Cranes AG in a voting rights notification that its share of voting rights in Demag Cranes AG passed above the 3, 5, 10, 15, 20, 25, 30, 50 and 75% voting rights thresholdon18December2012andamountedto81.92%(17,345,848votingrights)onthatday.The voting rights attributable to Terex Deutschland GmbH are actually held by Terex Industrial Holding AGandTIHAGFundingGmbH,companiesthatarecontrolledbyTerexDeutschlandGmbH.Aswellas to TIHAG Funding GmbH, the voting rights held by Terex Industrial Holding AG are also attributed to Terex Germany GmbH & Co. KG, Dsseldorf, Germany, Terex Verwaltungs GmbH, Dsseldorf, Germany, Terex European Holdings B.V., Amsterdam, Netherlands, Terex Netherlands B.V., Amsterdam,NetherlandsandTerexCorporation,Westport,USA. Elliott Asset Management LLC, Elliott Capital Advisors L.P., Braxton Associates, Inc., all of New York, USA, and Paul E. Singer, USA, notified Demag Cranes AG in a voting rights notification that their respective percentages of the voting rights in the Company passed above the 10% threshold on 15 August 2011 and amounted to 10.08% (2,133,794 voting rights) on that day. Cornwall (Luxembourg) S. r.l. notified Demag Cranes AG in a voting rights notification that its share of voting rights in the Company passed above the 3, 5 and 10% threshold on 15 March 2012 and amounted to 12.70% (2,689,317 voting rights) on that day. Wolverton (Luxembourg) S..r.l., Luxembourg, Luxembourg notifiedDemagCranesAGinavotingrightsnotificationthatitsshareofvotingrightsintheCompany passed above the 3, 5 and 10% threshold on 15 March 2012 and amounted to 12.71% (2,690,317 voting rights) on that day. Elliot International Capital Advisors Inc., New York, USA, Elliot International, L.P., George Town, Cayman Islands, Elliot International Limited, George Town, Cayman Islands, Maidenhead LLC, New York, USA, and Hambledon Inc., George Town, Cayman Islands notified Demag Cranes AG in a voting rights notification that their respective percentages of the voting rights in the Company passed above the 10% threshold on 15 March 2012 and amounted to 12.71% (2,691,317 voting rights) on that day. The voting rights are held through various investment companies,toeachofwhichtheyareattributable,insomecasesreciprocally. No other direct or indirect holdings in the Companys share capital that relate to more than 10% of votingrightsareknowntotheManagementBoard.

Securitiescarryingspecialrights
None of the shares issued by Demag Cranes AG carries special rights with regard to control of the Company.

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How rights are exercised on shares under an employee share scheme if not directly by employees
No information is available on the exercise of voting rights on shares under an employee share schemewheretherightsarenotdirectlyexercisedbyemployees.

Appointment and replacement of members of the Management Board; amendments to theArticlesofAssociation


The statutory governing and representative body of Demag Cranes AG is the Management Board. Under Article 6 (1) of the Articles of Association, the Management Board consists of at least two members. The size of the Management Board is otherwise decided by the Supervisory Board. The SupervisoryBoardmayappointdeputymembersoftheManagementBoard.IftheSupervisoryBoard does not nominate a Management Board member as CEO, the Management Board elects a spokespersonfromamongitsnumber. AppointmentandreplacementofManagementBoardmembersareeffectedonthebasisofSections 84 and 85 of the German Stock Corporations Act (AktG) and Section 31 of the German Co determination Act (MitbestG). In accordance with Section 84, AktG, members of the Management Board are appointed by the Supervisory Board for terms not exceeding five years. Management Board members may also be reappointed or their terms extended in increments not exceeding five years. Extension of terms and reappointment require a new resolution of the Supervisory Board,which can normally be adopted no earlier than one year before the end of the current term. The Supervisory Board may revoke the appointment of a member of the Management Board before the end of the members term of office for cause, for example, in the event of gross breach of duty or of a vote of no confidence at a general meeting. The Company is represented by two Management Board members or by one Management Board member acting jointly with an authorised signatory (Prokurist). In accordance with Section 179, AktG, amendments to the Articles of Association normally require a resolutionofthegeneralmeeting.Indeparturefromthisgeneralrule,amendmentsthatsolelyaffect the wording of the Articles of Association may be adopted by the Supervisory Board. The Companys Articles of Association provide that, unless otherwise stipulated by law, general meeting resolutions require a simple majority of votes cast and, if the law stipulates a majority of represented capital, a simplemajorityofthesharecapitalrepresentedatthetimeofthevote.

PowersoftheManagementBoardtoissueandbuybackshares
Under Article 4 (5) of the Articles of Association, the Management Board is authorised, subject to Supervisory Board approval, to increase the Companys share capital by issuing new noparvalue bearershares,eachrepresentingaprorataamountofoneeuroofthesharecapital,forcashornon cash consideration in one or more issues by up to a total of EUR 10,586,496 by or before 1 March 2016. The new shares may be taken up by one or more financial institutions determined by the ManagementBoardortakenupbyoneormoreenterpriseswithinthemeaningofthefirst sentence

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of Section 53 (1), of the first sentence of Section 53b (1) or of Section 53b (7) of the Banking Act (Kreditwesengesetz) subject to an undertaking that the shares will be offered to existing shareholders(indirectrightsissue). In certain circumstances and subject to Supervisory Board approval, the Management Board is authorisedtoexcludeexistingshareholdersstatutoryrightofpreemption. a) When issuing shares for noncash consideration for the purpose of granting to third parties sharesrepresentingaprorataamountofuptoEUR4,243,598ofthesharecapitalinconnectionwith business combinations or to acquire a business, part of a business or ownership interests in a business,includingtoincreasethesizeofexistingholdingsofownershipinterestsorotherassets; b) TotheextentneededtoprovideholdersofwarrantsorconvertiblebondsissuedbytheCompany or by Group companies under the management of the Company, for the purpose of preventing dilution,withrightstonewsharesintheamounttheywouldbeentitledtoonexerciseoftherightof purchaseorconversionorondischargeoftheconversionobligationorobligationtosell; c) Toexcludeanyfractionalamountarisinginarightsissue; d) Whenissuingsharesforcashconsiderationprovidedthat,inaccordancewithSection203(1)and (2)andthefourthsentenceofSection186(3)oftheGermanStockCorporationsAct(AktG),theissue price of the new shares is not significantly lower than the stock market price, at the time the final issue price is set by the Management Board, of existing listed shares of the same class and carrying the same rights and provided that the new shares for which the right of preemption is excluded do not together comprise more than 10% of the share capital at the time this authorisation comes into effect or at the time the authorisation is exercised, whichever amount is the lesser. The 10% maximum is reduced by the pro rata amount of the share capital attributed to shares (i) issued or sold during the lifetime of this authorisation or in application, directly or mutatis mutandis, of the fourth sentence of Section 186 (3), AktG or (ii) required to be issued to serve warrantlinked or convertible bonds in respect of which a right of purchase or a right of conversion or a conversion obligationexistsandwhichhavebeenissuedduringthelifetimeofthisauthorisationtotheexclusion ofexistingshareholdersrightof preemptioninapplicationmutatismutandisofthefourthsentence ofSection186(3),AktG. The Management Board is authorised, subject to Supervisory Board approval, to decide the remaining details of the increase in share capital and its conduct, including the nature of rights attachedtosharesandtheconditionsofshareissue. ByresolutionoftheCompanysAnnualGeneralMeetingof2March2010,theManagementBoardof Demag Cranes AG is further authorised, subject to Supervisory Board approval, to issue convertible and/or warrantlinked bearer bonds (collectively bonds) with limited or unlimited maturities up to an aggregate face value of EUR 210,000,000 on one or more occasions by or before 1 March 2015 andtogivethebondholdersconversionrightsand/oroptions(includingwithanattachedconversion obligation) to noparvalue bearer shares in the Company making up a maximum EUR 4,200,000 portion of the share capital in accordance with the detailed terms and conditions of the convertible orwarrantlinkedbondissue.Thebondsarerequiredtobeissuedsolelyforcash. The bonds may be denominated in euros or up to the equivalent of the stipulated maximum amount in a foreign currency that is legal tender, for example, the currency of an OECD country.

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The bondsmayalsobeissued bya Group company managedby theCompany;insuchinstances,the Management Board may, subject to Supervisory Board approval, guarantee the bonds on the Companysbehalfandgivebondholdersconversionrightsand/oroptions(includingwithanattached conversionobligation)tonoparvaluebearersharesintheCompany.Theissuesmustbedividedinto individualbonds. In a warrantlinked bond issue, one or more warrants are attached to each bond, granting the bondholder an option to subscribe for noparvalue bearer shares in the Company according to the termsandconditionsoftheoptionaslaiddownbytheManagementBoard.Theoptionlifetimemust notexceedthematurityofthewarrantlinkedbondissue. In a convertible bond issue, bondholders are given the right to convert their bonds into noparvalue bearer shares in the Company in accordance with the detailed terms and conditions of the convertible bond as laid down by the Management Board. The conversion ratio is arrived at by dividing the face value of a bond, or the issue price if lower, by the stipulated conversion price for a noparvalue bearer share in the Company. The conversion ratio may be rounded up or down to the nearestinteger;anadditionalcashpaymentmayalsobestipulatedifapplicable. The convertible bond terms and conditions may further stipulate a conversion obligation at maturity (or earlier). The portion of the share capital made up by noparvalue Company shares issued on conversionofeachbondmustnotexceedthefacevalueofthebond. The terms and conditions of the convertible or warrantlinked bonds may give the Company a right to grant bond creditors new shares or treasury shares in the Company instead of all or part of any amount due. Subject to more detailed provisions laid down in the bond terms and conditions, the value of such shares is determined as the arithmetic mean, rounded up to the nearest full cent, of closing auction prices for the same class of Company shares in XETRA trading (or a functionally equivalent successor trading system) on Frankfurt Stock Exchange on the last three trading days beforenoticeofconversionorexercise. The terms and conditions of the convertible or warrantlinked bonds may further provide on each occasion for treasury shares in the Company to be granted on conversion or exercise. They may also provide that instead of granting holders of convertible or warrantlinked bonds shares in the Company, the Company may pay bondholders the equivalent value in cash. Subject to more detailed provisionslaiddowninthebondtermsandconditions,thevalueofsuchsharesisdeterminedasthe arithmetic mean, rounded up to the nearest full cent, of closing auction prices for the same class of Company shares in XETRA trading (or a functionally equivalent successor trading system) on FrankfurtStockExchangeonthelastthreetradingdaysbeforenoticeofconversionorexercise. The stipulated conversion or exercise price on each occasion must be at least 80% of the arithmetic mean of the closing auction prices for the same class of Company shares in XETRA trading (or a functionally equivalent successor trading system) on Frankfurt Stock Exchange from the start of the subscription period to the third day (inclusive) before announcement of the final terms and conditions in accordance with the second sentence of Section 186 (2) of the German Stock CorporationsAct(AktG). If, during the conversion or exercise period, the Company conducts a rights issue for existing shareholders or issues further convertible or warrantlinked bonds or grants or guarantees conversion rights or options and does not give existing holders of conversion rights or options a

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corresponding subscription right of the scope they would be entitled to after exercising their conversion rights or options or meeting their conversion obligations, or increases the share capital out of retained earnings, the terms and conditions of the convertible and/or warrantlinked bonds must ensure that there is no effect on the economic value of existing conversion rights and/or optionsbyprovidingforamodificationoftheconversionrightsand/oroptionstomaintainthatvalue unless such modification is already required by law. The same applies mutatis mutandis upon a decrease in share capital, other corporate measures, restructuring, change of control, extraordinary dividendorothersimilarmeasuresthatmaydilutethesharevalue. Company shareholders normally have preemptive rights; that is, convertible and/or warrantlinked bonds must normally be offered to them. The bonds may also be bought by one or more banks provided they are then offered to shareholders. If bonds are issued by a Group company, the CompanymustensurethatsubscriptionrightsaregrantedtoCompanyshareholders. The Management Board may, subject to Supervisory Board approval, exclude shareholders pre emptiverightstobondsif,afterdueappraisal,itfindstheissuepricenottobesignificantlybelowthe bonds theoretical market value as determined by generally accepted financial mathematical methods. The authorisation to exclude shareholders preemptive rights is limited, however, to bonds with a conversion right or option (including with an attached conversion obligation) to shares making up no more than 10% of the share capital when the authorisation takes effect or, if smaller, of the share capital when the authorisation is exercised. The 10% maximum must be determined takingintoaccountanyamountofsharecapitalrelatingto(i)sharesissuedduringthelifetimeofthe authorisation under the fourth sentence of Section 186 (3), AktG to the exclusion of existing shareholders preemptive rights and (ii) shares sold during the lifetime of the authorisation out of repurchased treasury stock other than on the stock market or by way of an offer to all shareholders with the fourth sentence of Section 186 (3), AktG applying mutatis mutandis; any fractional amounts resulting from the subscription ratio; and any amount needed so that it is possible to give holders of previously issued conversion rights or options a subscription right of the scope they would be entitled to as shareholders after exercising their conversion rights or options or meeting their conversionobligations. TheManagementBoardisauthorised,subjecttoSupervisoryBoardapprovalandwhereapplicablein agreement with the boards of bondissuing Group companies, to decide the remaining details of the bond issues and terms, including interest rates and how interest is applied, issue price, term to maturity and denomination, antidilution provisions, conversion or option periods and conversion or exerciseprice. In conjunction with granting the Management Board authorisation to issue bonds, conditional authority was given to increase the Company's share capital by up to EUR 4,200,000 by issuing up to 4,200,000 new noparvalue bearer shares each comprising one euro of share capital (Conditional Capital). The conditional authority to issue shares is to be used for granting shares to holders of or creditorsunderconvertibleand/orwarrantlinkedbondsissuedwiththeaboveauthorisation.Shares are to be issued under the conditional authority solely to the extent that conversion rights and/or options are exercised or conversion obligations under such bonds are fulfilled and the Conditional Capital is needed for the purpose according to the terms and conditions of the convertible and/or warrantlinked bonds. The new shares are to be issued at the exercise or conversion price determined in accordance with the above authorisation. The new shares are entitled to dividends from the start of the financial year they are issued on exercise of conversion rights or options or on fulfilment of conversion obligations. The Management Board is authorised, subject to Supervisory

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Board approval, to decide the remaining details with regard to issuing shares under the conditional authority. The Company made no use of its authorisation to issue convertible and/or warrantlinked bonds in theshortfinancialyearfrom1October2012to31December2012;noshareswereissuedoutofthe ConditionalCapital.Likewise,noshareswereissuedoutofAuthorisedCapital. Thereisnoauthorisationtobuybackshares.

Significantagreementsconditionaluponachangeofcontrolfollowingatakeoverbid
In the event of a change of control in the Company, the CEO has the right to terminate his Management Board contract and give up his Management Board mandate within six months, giving three months notice to the end of a month. Circumstances in which a change of control is deemed to take place include when a shareholder acquires control of the Company within the meaning of Section29 of the German Securities Acquisition and Takeover Act (WpG) by holding at least 30% of the voting rights in the Company, including voting rights attributable to the shareholder under Section30WpG. Demag Cranes AG is not party to any other significant agreement that takes effect, alters or terminatesuponachangeofcontroloftheCompanyfollowingatakeoverbid.

Agreements with members of the Management Board or employees for the event of a takeoverbid
If he exercises his special termination right, the CEO receives by way of financial compensation his fixed salary up to the planned end of his contract term and a target bonus pro rata temporis up to theendofhiscontractterm,assuming100%targetattainment,butnomorethantwotimeshistotal annual compensation. For further information on Management Board contracts, please see the RemunerationReport.

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Generaleconomicenvironme ent1 Worlde economictr rends


Accordin ng to expert estimates,growth g of glo obal gross do omestic prod duct (GDP) c continued tostagnate during t the short fin nancial year of Demag C Cranes AG (fourth ( quarter of calen ndar year 20 012). The that did occu ur was driven, as in the past, by the emergingmarkets. m Whi le the BRICcountries c growth t again re egistered a positive p grow wth trend, g growth rates s in the eme erging marke ets remained on the whole at t the level of o the prior quarter. q By c contrast, the e mature ma arkets contin nued to suffe er from a poor eco onomic clim mate. Econom mic growth iin the USA deteriorated d d further, mo ost likely du ue to the uncertainty surrounding the fisc cal cliff deba ate, i.e. pending tax increases and b budget redu uctions at theendof2012. owingchartshows s thede evelopment ofrealGDPcomparedwith w theprior ryearperiod d: Thefollo RealyearonyearGD DPgrowth(b basedonthe eUSdollar) In%

(E)Estimat tes Source:Ox xfordEconomic cs,February2013

The econ nomic uncer rtainty in con nnection wit th the Europ pean debt crisis also affe ected the pro oducts of the Mat terial Handli ing segment t in the 201 2 short financial year (1 1 October 20 012 to 31 December D 2012). U Uncertainty regarding global econ nomic foreca asts continu ued to pus h down inv vestment spending g and cause consumptio on to fall. Se ectoral condi itions in new w crane busi ness broadly y tracked the market trend in mechanical engineering g, with grow wth rates for order intake e falling year on year

Sources s:OxfordEcon nomics,February2013;Com mmerzbank,Economic E Rese earch,Konjun nkturund Finanzm rkte,Decemb ber2012;VDM MAKonjunktu urbulletinDec cember2012;Bundesminis steriumfrWirtschaft undTech hnologie,Schla aglichterderWirtschaftspo W olitik,January2013

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despite the raising of business expectations towards the end of the year. The market was also affected by sustained price competition, mainly driven by surplus capacity, the large number of competitors and the financial crisis mentioned above. The services market was also subject to lower investment activity due to the economy. At the same time, the decline in industrial capacity utilisationinnearlyallmarketsresultedinaweakersparepartsbusiness. In the market in the Port Solutions segment, growth rates softened slightly towards the end of 2012 for container handling at ports and sea transport volumes. Customers in the Port Solutions segment once again stepped up investing activity in response to the continuing slight rise in transhipment volumes. This fuelled sustained good demand for versatile cargo handling equipment. Customers continue to show interest in costsaving or environmentally friendly cargo handling solutions, but demandissubjecttopronouncedpricecompetition.

Effectsoftheeconomicenvironmentonbusinessperformance
Segmental business performance was significantly affected by the overall economic uncertainties describedabove. In the Material Handling segment, demand for our products in the short financial year from 1 October 2012 to 31 December 2012 was naturally down on financial year 2011/2012 due to the shorter reporting period. The order intake and revenue nonetheless also decreased relative to the corresponding prioryear period (first quarter of financial year 2011/2012). This partly reflected ongoing uncertainty in the general economic environment and ongoing price competition. Partly, however,thelowerorderintakeandrevenuealsorelatedtooneoffitems(divestments).Forfurther details,pleaseseeBusinessperformanceoftheGroupanditssegments. In the Port Solutions segment, demand for our products increased despite the slackening growth momentumincontainerhandlingatportsandseatransportvolumes.Wegenerateda5.9%stronger order intake in the short financial year from 1 October 2012 to 31 December 2012 than in the corresponding prioryear period (first quarter of financial year 2011/2012). The current situation in thefinancialmarketscontinuestobedifficultandhasaddedcomplexityinenteringintocontractsfor both customers and suppliers. Revenue, however, was slightly down on the equivalent period of the previous year (first quarter of 2011/2012). This mainly relates to the accustomed variation in the project business. The decrease in Mobile Harbour Cranes was partly offset by initial revenue from majorprojectsinthesystemsbusiness.

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BusinessperformanceoftheDemagCranesGroupanditssegmentsinthe shortfinancialyearfrom1October2012to31December2012
TakeoverbyTerexandintegrationintotheTerexGroup
Following the successful takeover of Demag Cranes by Terex Industrial Holding AG, a subsidiary of Terex Corporation, Westport, Connecticut, USA, and the effective date of the domination & profit and loss transfer agreement in April 2012, efforts are underway to integrate Demag Cranes into the Terex Group so that the potential created by the business combination can be quickly realised. Since the takeover, the business of Demag Cranes has been conducted under the umbrella of the fifth Terex segment Material Handling & Port Solutions. Both Material Handling & Port Solutions are key infurtheradvancingthediversificationoftheTerexportfolioasawhole.Operationally,theobjective is to manage the entire Group as One Terex. The goal in the integration of Demag Cranes is therefore first and foremost to identify opportunities for revenue and profit growth on the foundation of the shared customer base while exploring potential to cut operating costs by shared useofresources. Demag Cranes has brought its capital market reporting into line with this new structure and has reported on the Material Handling & Port Solutions segments since the end of the short financial year. This segmentation also forms the basis of Group management and supervision. The Terex Port Equipment business and the Reach Stacker business in Montceau Les Mines will not be included in theFinancialStatementsofDemagCranes.TheformerentitiesofDemagCranesthathavebeensold toTerexareincludedintheFinancialStatementsuntilthedateofsale.

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DemagCranesAGshares2
DemagCranesAGshareshaveaverylowleveloftradingliquidityinthepastfinancialyear duetoits existingownershipstructure.Thesharesopenedshortfinancialyear2012atEUR49.54on1October 2012andclosedatEUR53.50on28December2012.

Keysharedata Numberofshares Yearendclosingprice(Closingpriceson 31Dec2012,30Sep2012,30Sep2011) Marketcapitalisation (on31Dec2012,30Sept2012,30Sep2011) Shareprice:annualhigh Shareprice:annuallow Earningspershare Operatingearningspershare Dividendpershare *AsperXETRA IdentificationNumbersandCodes WKN(Germansecuritiesidentificationnumber) ISIN Reuters Bloomberg DCAG01 DE000DCAG010 D9CGn.DE D9CGR Financial year inmillions EUR inEUR million EUR EUR EUR EUR EUR ShortFY 2012 2011/2012 2010/2011 21.17 53.50 1132.8 53.70 49.53 2.71 0.06 0.83 21.17 49.57 1049.5 60.30 47.20 4.00 2.80 3.33 21.17 58.34* 1235.2* 59.10* 28.73* 0.31 2.21 0.04

ClosingpricesontheFrankfurtStockExchange;source:www.ariva.de

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Ownershipstructure
With regard to individuals and institutions holding more than 3% of Demag Cranes AG shares, our ownershipstructurewasasfollowsattheeditorialdeadlineon22March2013:
Shareholding % Terextotal 81,92 Terex Industrial HoldingAG,Dsseldorf,Deutschland 81,92 Terex GermanyGmbH&Co.KG,Dsseldorf,Deutschland 81,92 Terex VerwaltungsGmbH,DsseldorfDeutschland 81,92 Terex EuropeanHoldingsB.V.(NL), 81,92 Amsterdam,Niederlande Shareholder Terex NetherlandsHoldingB.V.(NL), Amsterdam,Niederlande Terex Corporation,Westport,CT,USA TIHAGFundingGmbH,Dsseldorf,Deutschland Terex DeutschlandGmbH Elliotttotal Paul E.Singer,USA Of which BraxtonAssociates,Inc.,NewYork,NewYork,USA ElliottAssetManagementLLC,NewYork, NewYork,USA ElliottCapital Advisors,L.P.,NewYork, NewYork,USA ElliottInternational Capital AdvisorsInc.,NewYork, NewYork,USA Hambledon,Inc.,GeorgeTown, GrandCayman,CaymanIslands ElliottInternational,L.P.,GeorgeTown, GrandCayman,CaymanIslands ElliottInternational Limited,GeorgeTown, GrandCayman,CaymanIslands MaidenheadLLC,NewYork,NewYork,USA Of which Wolverton(Luxembourg)S.r.l., Luxembourg,Luxembourg Of which Cornwall (Luxembourg)S.r.l.,Luxembourg, Luxembourg *SecuritiesTradingAct 81,92 81,92 81,92 81,92 12,71 10,08 6,28 10,08 10,08 10,08 12,71 12,71 12,71 12,71 12,71 12,71 12,71 12,70 12,70 Votes 17.345.848 17.345.848 17.345.848 17.345.848 17.345.848 17.345.848 17.345.848 17.345.848 17.345.848 2.691.317 2.133.794 1.328.786 2.133.794 2.133.794 2.133.794 2.691.317 2.691.317 2.691.317 2.691.317 2.691.317 2.690.317 2.690.317 2.689.317 2.689.317 direct/ indirect direct indirect indirect indirect indirect indirect indirect indirect Attributedunder WpHG*

Sec.22,1(1),No.1 Sec.22,1(1),No.1 Sec.22,1(1),No.1 Sec.22,1(1),No.1 Sec.22,1(1),No.1 Sec.22,1(1),No.1 Sec.22,1(1),No.1

indirect indirect indirect indirect indirect indirect indirect indirect indirect direct/ indirect indirect direct/ indirect indirect direct

Sec.22,1(1),No.1 Sec.22,1(1),No.6 and(2) Sec.22,1(1),No.1 Sec.22,1(1),No.1 Sec.22,1(1),No.1 Sec.22,1(1),No.6 Sec.22,1(1),No.1 Sec.22,1(1),No.1 Sec.22,1(1),No.1

Sec.22,1(1),No.1

Sec.22,1(1),No.1

The current shareholder structure of Demag Cranes AG is available on the Companys website at www.demagcranesag.com/shareholder_structure.

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BusinessperformanceoftheGroupanditssegments
Note Due to the fact that the financial year of Demag Cranes AG has been adapted to the calendar year, thefiguresfortheshortfinancialyearfrom1October2012to31December2012andthechangesin income and expenses are only comparable with the previous 12month financial year to a limited extent.Forthatreason,wehavecomparedtheincomeandexpensesfortheshortfinancialyearwith the figures published for the first quarter of the 2011/2012 financial year (1 October 2012 31 December2012). The following companies were sold to Terex on 14 December 2012: Demag Cranes & Components S.A.S, Chlons en Champagne; DCC France HoldCo SA, Chlons en Champagne; Demag Cranes & Components S.A.U., Madrid; Demag Cranes & Components S.p.A., Agrate Brianza; Donati Sollevamenti S.r.l., Varese; and Demag Cranes & Components Pty. Ltd., Smithfield. These companies are not therefore included in the financial statement figures as at 31 December 2012. Their income and expenditure is included in profit or loss from 1 October 2012 until 14 December 2012. Divestment of the two US companies Demag Cranes & Components US, Cleveland, USA and Crane AmericaServices,Dayton,USAtookplaceasof29June2012.Thefinancialstatementfiguresasat31 December 2012 and 30 September 2012 are without these two companies. Their income and expenditureisnotincludedinprofitorlossfortheshortfinancialyear.Theirincomeandexpenditure isincludedproratauntiltheirdeconsolidationinprofitorlossfor2011/2012.

Orderintake/orderbook
The Demag Cranes Group generated an order intake of EUR 223.0 million in the short financial year from 1 October 2012 to 31 December 2012 (financial year 2011/2012: EUR 1,326.6 million). The order intake in the corresponding prioryear period (first quarter of financial year 2011/2012) was EUR290.4million. Thesegmentscontributedtotheorderintakeasfollows:
ShortFY 2012 inEURmillion Material Handling PortSolutions Grouporderintake 160.2 62.9 223.0 881.9 444.7 1,326.6 231.0 59.4 290.4 30.7% 5.9% 23.2% FY 2011/2012 Q1 2011/2012

Q1

The Group order book stood at EUR 535.7 million at 31 December 2012, compared with EUR 545.7 millionat30September2012.

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31December 30September 2012 2012 inEURmillion Material Handling PortSolutions Grouporderbook 247.7 288.0 535.7 259.8 285.9 545.7 4.7% 0.7% 1.8% 290.9 99.1 390.0 31December 2011

The order intake in the Material Handling segment, at EUR 160.2 million, was down on the corresponding prioryear period (first quarter of financial year 2011/2012: EUR 231.0 million), primarily as a result of divestment of Demag Cranes & Components US, Cleveland, USA and Crane America Services, Dayton, USA, both of which came under the Material Handling segment. Also, we generated fewer orders notably for standard and process cranes as well as for refurbishment services. The Port Solutions segment recorded a positive trend in the order intake in the short financial year 2012.Comparedwiththecorrespondingprioryearperiod(firstquarteroffinancialyear2011/2012), incomingordersincreasedby5.9%fromEUR59.4milliontoEUR62.9million.Thispositivetrendwas driven by a followup order from a largescale project and the accustomed variation in the project business.

Revenue
GrouprevenuecametoEUR227.1millionintheshortfinancialyear2012.Thesegmentscontributed torevenueasfollows:
ShortFY 2012 inEURmillion Material Handling PortTechnology Grouprevenue 167.3 59.8 227.1 858.5 264.8 1,123.3 203.4 66.5 269.9 17.7% 10.1% 15.8% FY 2011/2012 Q1 2011/2012

Q1

RevenuegeneratedintheMaterialHandlingsegment,atEUR167.3million,was17.7%downonthe corresponding prioryear period (first quarter of financial year 2011/2012: EUR 203.4 million). The decreaseinrevenuemainlyrelatestothedivestmentofDemagCranes&ComponentsUS,Cleveland, USA and Crane America Services, Dayton, USA, both of which came under the Material Handling segmentandweresoldtoTerexinfinancialyear2011/2012. Revenue in the Port Solutions segment was likewise down on the corresponding prioryear period (first quarter of financial year 2011/2012). This was the result of a reduced order book in mobile harbourcranesatthebeginningofthequarterandtheaccustomedvariationintheprojectbusiness.

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Revenueisdistributedamongtheregionsasfollows:
ShortFY 2012 inEURmillion Germany Restof Europe NorthAmerica Mature markets BRICcountries Central andSouthAmerica Asia/Pacific Other Emergingmarkets Grouprevenue 50.7 79.2 9.9 139.8 34.0 3.8 42.8 6.7 87.3 227.1 226.7 319.3 128.5 674.5 191.2 30.3 160.3 67.0 448.8 1,123.3 50.6 64.3 42.0 156.9 55.9 6.2 43.7 7.2 113.0 269.9 22.3 34.9 4.4 61.6 15.0 1.7 18.8 3.0 38.4 100.0 20.2 28.4 11.4 60.0 17.0 2.7 14.3 6.0 40.0 100.0 18.7 23.8 15.6 58.1 20.7 2.3 16.2 2.7 41.9 100.0 FY 2011/2012 Q1 2011/2012 ShortFY in%of revenue 2011/2012 FY 2011/2012 Q1 2011/2012

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DemagCranesGroupfinancialreview
DemagCranesGroupearnings
Earnings before interest and tax (EBIT) was EUR 59.9 million in the short financial year from 1 October 2012 to 31 December 2012, compared with EUR 130.3 million in financial year 2011/2012. Thecomparativefigureforthefirstquarteroffinancialyear2011/2012wasEUR13.1million. The Management Board uses operating EBIT as a key indicator for management of the Group. OperatingEBITexcludesonetimeeffectssuchasrestructuringexpensesandproceedsfromorlosses on the sale of companies. It also excludes Group allocations as well as purchase accounting depreciation and amortisation, comprising the impact on depreciation and amortisation of fair value adjustmentstoassetsacquiredinbusinesscombinations. At Group level, we generated operating EBIT of EUR 4.1 million in the short financial year 2012, compared with EUR 89.2 million in financial year 2011/2012. Operating EBIT in the first quarter of financialyear2011/2012wasEUR14.1million.
ShortFY 2012 inEURmillion GroupEBIT Operatingadjustments Ofwhich Purchase accountingdepreciationandamortisation Integrationcosts Restructuringcosts Refinancingexpenses ManagementserviceschargedbyTerex Costsincurredinconnectionwiththe take over byTerex Industrial HoldingAG Earningsgeneratedbythe sale ofentities Other GroupoperatingEBIT Ofwhich Material Handling&PortSolution in%ofrevenue PortSolutions in%ofrevenue Central holdingcompany/DemagCranesAG 59.9 55.7 0.3 0.0 4.2 0.0 3.4 0.0 66.7 3.0 4.1 0.8 0.5 2.6 4.3 0.7 FY 2011/2012 130.3 41.0 1.2 0.6 3.8 0.0 5.7 1.1 57.2 3.8 89.2 81.3 9.5 13.4 5.0 5.4 Q1 2011/2012 13.1 1.0 0.3 0.1 0.0 0.5 0.2 14.1 14.0 6.8 2.1 3.2 2.1

Q1 323.9%

70.8% 94.1% 23.3%

ThefollowingtableshowsthedevelopmentofoperatingEBITDA:
ShortFY2012 2011/2012 inEURmillion GroupoperatingEBIT Operatingdepreciationandamortisation GroupoperatingEBITDA 4.1 5.1 9.2 FY 2011/2012 89.2 20.4 109.6 Q1 2011/2012 14.1 5.1 19.2

Q1 70.8% 0.1% 51.9%

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The following table contains an overview of the Groups key cost items. The Operating column shows function costs adjusted for the effects of operating adjustments. You will find a detailed breakdownoftheoperatingadjustmentsinthereconciliationofGroupEBITtooperatingEBIT.
ShortFY 2012 Reported 175.1 77.1 59.0 26.0 40.1 17.7 15.5 6.8 4.9 2.1 97.0 42.7 FY 2011/2012 Reported 806.4 71.8 231.5 20.6 158.6 14.1 67.2 6.0 18.3 1.6 380.2 33.8 Q1 2011/2012 Reported Operativ 197.7 73.3 56.4 20.9 38.6 14.3 17.7 6.6 3.9 1.5 91.6 33.9 197.8 73.3 55.3 20.5 38.7 14.3 16.7 6.2 3.9 1.4 91.6 34.0

inEURmillion Costof sales in%ofrevenue Selling,general andadministrative expenses in%ofrevenue Ofwhich Sellingexpenses in%ofrevenue General andadministrative expenses in%ofrevenue Researchanddevelopmentexpenses in%ofrevenue Personnel expenses in%ofrevenue

Operativ 164.9 72.6 53.8 23.7 39.1 17.2 14.7 6.5 4.8 2.1 86.0 37.8

Operativ 803.2 71.5 218.9 19.5 157.1 14.0 61.8 5.5 18.2 1.6 374.1 33.3

The Demag Cranes Group generated earnings before tax (EBT) of EUR 57.7 million in the short financial year 2012 (financial year 2011/2012: EUR 117.0 million; first quarter of financial year 2011/2012:EUR10.1million). Operating income after tax came to EUR 1.4 million in the short financial year 2012, compared with EUR 59.3 million in financial year 2011/2012. Operating income after tax in the first quarter of financialyear2011/2012wasEUR8.1million. Operating earnings per share (operating EPS) amounted to EUR 0.06, compared with EUR 2.80 in financialyear2011/2012andEUR0.38inthefirstquarteroffinancialyear2011/2012.

Dividend
UnderSection2ofthedominationandprofitandlosstransferagreementwithTerexGermany&Co. KG, Demag Cranes AG has undertaken to transfer its total profit to Terex Germany. In return, Terex Germany has undertaken in Section 4 of the agreement to pay Demag Cranes AG shareholders a guaranteed annual dividend of EUR 3.33 gross, or EUR 3.04 net, for the duration of the agreement. The guaranteed dividend for the short financial year 2012 is therefore EUR 0.83 gross or EUR 0.76 net.

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DemagCranesGroupcashflows
Free cash flow before financing the balance of cash flow from operating activities and cash flow from investing activities was EUR 67.8 million in the reporting period. The figure changed as follows:
ShortFY 2012 inEURmillion Cashflowfromoperatingactivities Cashflowfrominvestingactivities Free cashflowbefore financing Restructuringpayments Free cashflowbefore financingandrestructuringpayments 1.4 69.3 67.8 0.0 67.8 40.7 74.4 115.1 0.5 115.6 12.5 4.8 17.3 0.2 17.1 n/a n/a n/a n/a n/a FY 2011/2012 Q1 2011/2012

Q1

Compared with the corresponding prioryear period (the first quarter of financial year 2011/2012), cash flow from operating activities increased by EUR 11.1 million in the period under review. This mainlyrelatestothedecreaseinnetworkingcapital. CashflowfrominvestingactivitieswentupfromminusEUR4.8millioninthefirstquarteroffinancial year 2011/2012 to EUR 69.3 million in the short financial year 2012. This is mainly accounted for by the sale of the companies Demag Cranes & Components S.A.S, Chlons en Champagne; DCC France HoldCo SA, Chlons en Champagne; Demag Cranes & Components S.A.U., Madrid; Demag Cranes & Components S.p.A., Agrate Brianza; Donati Sollevamenti S.r.l., Varese; and Demag Cranes & ComponentsPty.Ltd.,Smithfield,forasellingpriceofEUR83.7million. The following table shows a breakdown of capital expenditure on intangible assets and property, plantandequipmentbysegment:
ShortFY 2012 inEURmillion Material Handling PortSolutions Central holdingcompany/DemagCranesAG Capitalexpenditure 6.8 1.1 0.2 8.1 14.8 4.3 3.2 22.3 2.1 0.7 2.1 5.0 223.5% 52.2% 89.4% 63.1% FY 2011/2012 Q1 2011/2012

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Groupfinancing
inEURmillion Noncurrentloansandborrowings Currentloansandborrowings Cashandcashequivalents Othercurrentfinancial assets Netdebtinconnectionwith available forsale assets Netdebt 31Dec2012 0.7 86.8 54.1 171.6 0.0 138.3 30Sept2012 0.8 8.8 55.9 15.7 35.3 26.8 30June 2012 0.8 60.3 52.6 13.0 4.5 31March2012 135.9 8.7 94.2 0.3 50.0 31Dec2011 135.9 3,6 102.9 0.3 36.2

FurtherinformationisprovidedintheNotestotheConsolidatedFinancialStatementsunderNote35 (Capitalmanagement). The net cash position increased from EUR 26.8 million at the 30 September 2012 balance sheet date toEUR138.3millionat31December2012.Thismainlyreflectedthecashinflowfromthesaleofthe companies Demag Cranes & Components S.A.S, Chlons en Champagne; DCC France HoldCo SA, ChlonsenChampagne;DemagCranes&ComponentsS.A.U.,Madrid;DemagCranes&Components S.p.A.,AgrateBrianza;DonatiSollevamentiS.r.l.,Varese;andDemagCranes&ComponentsPty.Ltd., Smithfield,aswellasthereceiptofanadvancepaymentforalargescaleprojectinthePortSolutions segment. FinetuningtheGroupsfinancingistheresponsibilityoftheGrouptreasury.Theprimaryobjectivein this is to guarantee the Companys continuing ability to operate as a going concern and its earnings power. Rolling cash forecasts and central cash management ensure that the Group has adequate fundingatalltimes,includingintheformofborrowingsandcreditbalancesatTerexGermanyGmbH &Co.KG. In the context of its financing activities, Demag Cranes AG requires not only loans and borrowings, but also guarantee facilities allowing bid, downpayment, performance and warranty bonds/guarantees to be issued on its behalf. Bank guarantees are drawn under bilateral guarantee facilities. The central aim of this financing portfolio is to secure suitable lines of credit for us to field the liquidity needed for industryspecific seasonal fluctuations and the ongoing development of our business. Ourfinancingissupplementedwithoffbalancesheetoperatingleases,includingforIThardwareand forthevehiclefleetintheServicesbusiness. The Demag Cranes Group normally borrows centrally as part of the Terex cash pooling arrangement. Local borrowing is only taken out in individual instances if Group borrowing is unfavourable due to the legal environment. Demag Cranes AG must expressly approve such borrowing, however. A central cash pooling arrangement allows cash surpluses at subsidiaries to be deployed cost effectivelyintheGroup. Financial risks are explained in the Risk report and in the Notes to the Consolidated Financial Statements,underNote28(Loansandborrowings).

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DemagCranesGroupfinancialposition
ThefinancialpositionoftheDemagCranesGroupchangedasfollowsinthereportingperiod:
inEURmillion Inventories Advance paymentsmade Trade receivables Trade payables Advance paymentsreceived Networkingcapital 31Dec2012 188.0 6.1 149.3 44.6 150.9 147.8 30Sept2012 188.0 4.1 147.9 48.9 86.9 204.2 30June 2012 214.8 4.9 168.7 56.8 78.4 253.2 31March2012 229.4 3.6 184.8 65.5 94.4 257.9 31Dec2011 228.9 4.7 182.7 66.7 95.4 254.2

Networking capitalinventories,advancepaymentsmadeandtradereceivableslesstradepayables and advance payments received declined from EUR 204.2 million at 30 September 2012 to EUR 147.8millionat31December2012.Thiswasduetotheincreaseinadvancepaymentsreceivedfrom EUR86.9milliontoEUR150.9million,mostlyrelatingtoanadvancepaymentonalargescaleproject inthePortSolutionssegment.
31December2012 inEURmillion Total assets Equity Gearingin% 884.2 258.8 53.4% 802.5 276.1 9.7% 30September2012

The Demag Cranes Group had total assets of EUR 884.2 million at 31 December 2012, an increase of EUR 81.7 million on 30 September 2012. The main factor in the increase is the abovementioned advancepaymentonalargescaleprojectinthePortSolutionssegment. In addition to the liabilities shown on the Statement of Financial Position, there are guarantees for thirdparty liabilities in the form of contingent liabilities relating to buyback arrangements entered into in the Port Solutions segment in connection with sales of certain Company plant and machinery products (see also Note 37 (Contingencies and other obligations) of the Notes to the Consolidated FinancialStatementsinthe2011/2012AnnualReport).Themaximumpotentialobligationamounted toEUR43.2millionat31December2012,comparedwithEUR42.7millionat30September2012. Gearing theratioofnet debt toshareholdersequitychanged inthereportingperiodfromminus 9.7%at30September2012tominus53.4%at31December2012.

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DemagCranesAGfinancialreview
Supplementary to reporting on the Demag Cranes Group, in the following we present the performance of Demag Cranes AG. The Financial Statements of Demag Cranes AG are prepared in accordance with the German Commercial Code (HGB) and the German Stock Corporations Act (AktG). In the course of its ordinary operating activities, Demag Cranes AG provides services in its shared services function relating to Financial Controlling, Finances and Accounting, Group Accounting, Communication, IT, Strategic Purchasing, Human Resources, Corporate Strategy, Corporate Communication&MarketingandLanguageServices.

DemagCranesAGearnings
ShortFY inEURmillion Netincome fromparticipatinginterests Income underprofittransferagreements Losstransfer Netinterestincome Otherexpensesandincome/revenue Otheroperatingincome/revenue General andadministrative expenses/costofsales/other operatingexpenses Profit/(loss)fromordinaryactivities Extraordinaryincome/expenses Income tax Netincomeforthefinancialyear 2012 59.6 1.6 1.2 14.2 13.8 59.6 0.0 0.6 60.2 FY 2011/2012 40.2 0.0 2.1 50.5 59.4 33.4 2.0 13.2 18.2 Q1 2011/2012 4.9 0.6 0.4 12.8 15.9 1.6 0.0 0.2 1.4

The information on individual segments set out in the Management Report applies likewise with regard to the earnings of Demag Cranes AG. As in the previous year, the earnings of Demag Cranes AG are dominated by net income from participating interests. This came to EUR 58.0 million in the short financial year from 1 October 2012 to 31 December 2012 (2011/2012: EUR 40.2 million). Net income from participating interests improved by EUR 17.8 million year on year. It should be noted that the sale of associated companies generated income totalling EUR 63.9 million at Demag Cranes &Components GmbH and DCC HoldCo 5 (fnf) GmbH. In the previous year, this included onetime income totalling EUR 22.6 million from the sale of participating interests and the fair value measurement of the investments in affiliated companies at the balance sheet date, also at the level ofasubsidiary. NetinterestincomemirrorstheGroupfinancingactivitiesofDemagCranesAG. Demag Cranes AG performs central management functions as the holding company of the Demag Cranes Group. Exercising these functions generated other operating expenses and income/revenue totallingEUR0.4millioninthe2012shortfinancialyear(2011/2012:EUR8.9million).Thedeclinein general and administrative expenses/cost of sales is mainly the result of a fall in personnel and consultingcosts.

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Extraordinary income/expenses in the previous year include EUR 2.0 million in expenses for staff restructuring measures in connection with the reorganisation and integration of Demag Cranes into theTerexGroup. The EUR 60.2 million in net income before profit transfer for the short financial year from 1 October 2012 to 31 December 2012 was transferred to Terex Germany GmbH & Co. KG on the basis of the profit&losstransferagreementbecomingeffectiveon18April2012. The development of nonfinancial success factors is described in the Development of nonfinancial successfactorssection.

DemagCranesAGcashflowsandbalancesheet
Assets inEURmillion Intangible assets Property,plantandequipment Investmentsinaffiliatedcompanies Receivablesfromaffiliatedcompanies Cashandcashequivalents Otherassets Assets Liabilitiesandshareholders' equity inEURmillion Shareholders'equity Provisions Liabilitiesowedtoaffiliatedcompanies Otherliabilities Liabilitiesandshareholders' equity 31December2012 3.5 4.4 215.9 169.7 0.0 4.0 397.5 30September2012 3.8 4.6 215.9 247.4 4.0 4.2 479.9

31December2012 283.2 29.5 82.0 2.8 397.5

30September2012 283.2 33.7 161.5 1.5 479.9

The balance sheet reflects the holding company function of Demag Cranes AG. In this capacity, the Company manages and administers its Group member companies and associated companies and controls Group financing. This shows through in the size of its shareholdings in affiliates as well as in receivables from and liabilities to Group member companies. Total assets declined by EUR 82.4 million to EUR 397.5 million. This decline resulted mainly from the decrease in receivables from and liabilitiestoaffiliatedcompaniesdueprimarilytomutualsettlementofexistingclaimsincash. Investments and receivables from affiliated companies accounted for 97.0% of total assets (30 September2012:96.5%). The Company and Group member companies are mainly financed through shareholders equity and theinternalGroupcashpool. Demag Cranes AG had an equity ratio (equity to total assets) of 71.3% at the balance sheet date (30 September 2012: 59.0%). Of the Companys total financing, 20.6% was secured through affiliated

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companies (30 September 2012: 33.7%) as well as 8.1% through provisions and other liabilities (30 September2012:7.3%). The Company had access to a sufficient and appropriate level of liquidity throughout the 2012 short financial year. Its solvency is ensured at all times by central resource equalisation under internal Group cash pooling, which comes under the companys central cash and foreign exchange managementsystem. As the holding company for the Demag Cranes Group, Demag Cranes AG derives most of its income fromitssubsidiaries.TheexpectationsfortheGroupsbusinessdevelopmentoutlinedintheforecast reportarelikelytobereflectedintheearningsofDemagCranesAG.

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Developmentofnonfinancialsuccessfactors
Employees Employeestructureandemployeerelatedkeyfigures
As at 31 December 2012, the Group had 5,108 employees, 594 fewer than at 30 September 2012. This relates to the sale of the companies Demag Cranes & Components S.A.S, Chlons en Champagne; DCC France HoldCo SA, Chlons en Champagne; Demag Cranes & Components S.A.U., Madrid; Demag Cranes & Components S.p.A., Agrate Brianza; Donati Sollevamenti S.r.l., Varese; and Demag Cranes & Components Pty. Ltd., Smithfield. Adjusted for this oneoff effect, the number of employeesremainedbroadlyconstantoverthereportingperiod.
Employeerelatedkeyfigures ShortFY 2012 Operatingpersonnel expensesinEURmillion Operatingpersonnel expenses/revenue Operatingpersonnel expenses/employee inEURthousand* Revenue/employee inEURthousand* 86.0 37.8% 16 42 FY 2011/2012 374.1 33.3% 62 187 Q1 2011/2012 91.6 34.0% 15 44

Numberofemployeesbysegment** 31Dec2012 Material Handling PortSolutions DemagCranesAGemployees OfwhichinGroupheadquarters DemagCranesGrouptotal


*Ba s ed on a vera ge numberof empl oyees **Empl oyees ,excl udi ng tempora ry empl oyees ,a pprenti ces a nd tra i nees

30Sept2012 4,703 746 263 191 5,712

30June 2012 4,722 738 266 194 5,726

31March2012 5,311 735 266 196 6,312

31Dec2011 5,250 712 267 199 6,229

4,113 733 262 189 5,108

Humanresourcesmanagement
Our integration into the Terex Group is in full swing. The focus here is primarily on the future Material Handling & Port Solutions segments. In addition, Demag Cranes will be integrated into Terexshumanresourcesmanagementsystems. DiversityisaveryimportantissuefortheCompany,andintegrationintotheTerexGroupwillfurther boostourinternationalmakeup. Wealsoconsidertherepresentationofwomeninmanagementpositionstobehighlyimportant.

Procurementandpurchasing
In the past short financial year, delivery times for key components remained similar to those in the comparison period in financial year 2011/2012. A key focus for Demag Cranes AGs Corporate Purchasing was therefore to ensure procurement of materials in a timely manner by coordinating capacitywithsuppliersasearlyaspossible.Moreover,wecontinuallyreviewedthecreditstandingof our suppliers to identify unfavourable developments early on and, if necessary, to introduce necessary countermeasures quickly. We also continued to take necessary measures so that we do notbecometoodependentonanyindividualsupplier.

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In the period under review, we saw price increase requests from a number of our suppliers. The Demag Cranes Groups internationally focused procurement strategies enabled us to offset these price increases in most cases. The Companys global purchasing presence allows Corporate Purchasing to react flexibly to constantly changing market conditions and to systematically exploit local procurement advantages. In this regard, the focus is on the procurement markets in emerging economies,wherewehaveourownpurchasingofficesinkeylocations.

Researchanddevelopment
In our research and development (R&D) activities, we aim to provide customers with the highest standards of innovative products and services. We do our utmost in the process to satisfy customer needs in terms of performance, value for money and reliability. We achieve this from our position as technology leaders by constantly seeking groundbreaking, futureready solutions and improving existingproducts. R&D expenses, before capitalised development expenses, amounted to EUR 5.5 million in the 2012 short financial year, compared with EUR 20.8 million in the previous financial year and EUR 4.5 million in the corresponding prioryear period (first quarter of financial year 2011/2012). EUR 0.6million (financial year 2011/2012: EUR 2.5 million; first quarter of financial year 2011/2012: EUR 0.5 million) of this amount was capitalised. In line with development work carried out, development expenses were also capitalised in the Material Handling segment in the year under review (EUR 0.2 million).TotalR&Dexpensesbrokendownbysegmentwereasfollows: EUR 1.3 million (23.5% of total R&D expenses) (financial year 2011/2012: EUR 4.6 million, 22.4%; first quarter of financial year 2011/2012: EUR 1.0 million, 22.4%) was attributable to the Port Solutionssegment; EUR 4.2 million (76.5% of total R&D expenses) (financial year 2011/2012: EUR 16.2 million, 77.6%; first quarter of financial year 2011/2012: EUR 3.5 million, 77.6%) was attributable to the Material Handlingsegment; R&D in the Material Handling segment continued to focus on expanding the product range for fast growing markets, and notably China and India. This included adding further models to the Bas productrange. Developments in the Port Solutions segment focused on expanding the mobile harbour crane product range and reducing manufacturing costs, allowing us to compete more effectively in emerging economies. We also worked on producing more effective, ecofriendly solutions with the development,implementationandlaunchofbatterypoweredAGVs.

Environmentandoccupationalsafety
Opportunities to protect the environment abound in any company: separating waste, avoiding emissions, using resources sparingly these are just a few examples of activities that are an integral part of our corporate policy. More and more companies are being required not only to implement quality and environmental management systems, but also prove that they have introduced systems to manage occupational health and safety issues. This requirement and the responsibility, goals and duties anchored in our corporate policy led to the successful introduction of an OHSAS 18001:2007 occupational health and safety management system as part of a matrix certification at the German productionlocationsaswellastheCzechproductionlocationattheendof2011.

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Riskreport
Riskmanagementsystem
Active and transparent management of the various risks within the operating segments is a key tool for ensuring corporate success. Integrated analysis and management of earningsrelated risk factors andgoingconcernrisksrequirecoordinatedGroupwideplanning,reporting,financialcontrolaswell asearlywarningsystemsandprocesses. Risk management responsibilities are allocated in line with the Group structure. As a general rule, risk managers at Group member companies and associated companies as well as at Group headquarters manage the risks arising in their area of responsibility. A risk controller for each segmentsupportstheriskmanagementprocessatsegmentlevelandchecksthedataforplausibility. At Group level, a central risk controller has overall responsibility for preparing the Group risk report andcoordinatingtheriskmanagementprocess.AllsegmentrisksthatmayaccumulateatGrouplevel are recorded and managed centrally. The central risk controller additionally consults with the department heads responsible (functional risk managers) about the risks reported by local risk managers,whichalsobooststhequalityofourriskmanagement. DemagCranesGroupsriskearlywarningsystemcompliesfullywithstatutoryrequirements.

Opportunitymanagement
Separationofriskmanagementandopportunitymanagement As a rule, we address risk management and opportunity management separately. A separate risk reporting system documents risks and supports risk monitoring. Recording and communicating opportunities, on the other hand, is an integral part of the established management and control system between Group member companies and associated companies and the parent company, Demag Cranes AG. The management of individual companies is directly responsible for identifying, analysingandactingonoperationalopportunities.

Significantindividualrisks
Financialrisks The Demag Cranes Group is exposed to financial risk in its operating activities. Monitoring, controlling and limiting this risk at Group level (financial risk management) and finetuning the Groups finances are the responsibility of Group treasury. The primary objective in this is to guarantee the Companys continued ability to operate as a going concern and its earnings power. Rolling cash forecasts and central cash management ensure that the Group has adequate funding at all times, including in the form of borrowings and credit balances at Terex Germany GmbH & Co. KG. Derivative financial instruments are used solely to hedge underlying transactions. Trading, settlementandbackofficefunctionsarestrictlyseparated. ThefollowingfinancialrisksaremanagedintheDemagCranesGroup:

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Currencyrisks Most Group business is transacted in euros, US dollars and pounds Sterling. The Group is mainly exposed to currency risk where payables and receivables exist or are likely to arise in a currency other than the local currency of the company recording them. As part of active risk management, foreign currency payables and receivables are normally hedged as they arise using financial instruments (foreign exchange contracts) (see also the Notes to the Consolidated Financial StatementsunderNote34(Additionaldisclosuresonfinancialinstruments)). Liquidityrisks LiquidityriskcanresultintheDemagCranesGroupbeingunabletomakeavailablethefundsneeded to meet financial obligations entered into in its operating business or in connection with financial instruments.SafeguardingtheliquidityoftheDemagCranesGroupwhileallowingsufficientreserves for special eventualities is therefore an integral part of ongoing liquidity management. Resource equalisation within the Group through cash pooling and intercompany loans ensures that cash surpluses at individual Group member companies are efficiently used to meet funding needs in others. Sufficient cashpool credit facilities at Terex Germany GmbH & Co. KG ensured that neither funding nor liquidity shortfalls arose in the short financial year from 1 October 2012 to 31 December 2012. Under the cash pooling agreements entered into with Terex Germany GmbH & Co. KG, the Group had EUR 150.0 million undrawn on a credit facility at the balance sheet date (financial year 2011/2012:EUR150.0million).ThecashpoolcreditfacilityatTerexGermanyGmbH&Co.KGcanbe drawn against at any time and at short notice. Under bilateral loan agreements, the Group also had access to EUR 30.5 million in undrawn guarantee facilities at the balance sheet date (financial year 2011/2012:EUR29.3million). Creditrisks Credit risk arises when customers or other contractual partners delay or default in meeting their obligations under a business transaction and financial losses are suffered as a result. The Demag CranesGroupcountersspecificcreditriskbyonlydoingbusinesswithpartiesofgoodcreditstanding, primarily based on the ratings of national and international trade credit rating agencies, and by rigorously observing risk limits laid down by trade credit insurers. Credit risk is also avoided by agreeingadvancepaymentsandtheuseofdocumentarylettersofcredit. Compliancerisks Reporting on compliance risks covers risks such as legal risks, risks arising from fraudulent activity, corruption or breaches of antitrust law, and risks arising from breaches of other compliance regulations. The Demag Cranes Group has established a compliance management system that counters these risks through the Code of Conduct as well as various compliance corporate policies, audits and employee training initiatives. A regular Groupwide compliance report describes the status of the compliance management system so that risks can be promptly identified and appropriate measures taken. Compliance risk is also addressed within the higherlevel risk management system. The Management Board and the Compliance Officers review the compliance managementsystemofDemagCranesAGregularlyandadaptittomeetchangingrequirements. As a result of the combination of Terex Corporation and Demag Cranes, the Demag Cranes compliance program is in the process of being integrated with the Terex Corporation compliance

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program in a coordinated fashion. The Company is expected to benefit from both its participation in theTerexCorporationcomplianceprogramanditsaccesstogreatercomplianceresources. Operatingrisks Salesrisks Given its worldwide operations, the Demag Cranes Group is exposed to fluctuations in prices and volumes on its sales markets. It counters this general risk by diversifying its product portfolio as well as the sectors and regional markets to which it sells. By continuously monitoring the markets, it updates its sales strategy is to take account, for example, of changing customer requirements or competitorbehaviour. Procurementrisks There are certain dependencies relating to suppliers of the Demag Cranes Group. These arise in part because there are only limited possibilities for changing suppliers of certain components and assemblies at short notice and in part because there is a technical/commercial dependency on suppliers of certain components, especially mouldspecific components. The Group has defined clear procurement strategies for such cases to safeguard supplies in the long term. Boughtin parts account for a large proportion of production costs. As the steel industry, for example, is subject to strong cyclical movements, prices can be volatile. Through a wide range of specific measures, the Groupconstantlyendeavourstosecureprevailingmarketprices. Productionprocessrisks Production processes can give rise to complex risks, the main ones being unanticipated technical difficulties, unforeseen developments at project locations, problems at partner companies or subcontractors and the resulting disruptions to logistics. These risks are minimised by issuing comprehensive corporate policies and procedural instructions on project and quality management, product and occupational safety as well as environmental protection. Risks are also mitigated through systematic employee training and development, continuous improvements to production processes and technologies as well as regular plant and system maintenance. The Group has adequate insurance cover for losses resulting from technical failure, fire, explosions and similar events. Majorprojectrisks Within the Group, potential major project risks, such as liability and earnings risks, are continuously monitoredandmitigatedthroughstrictprojectmanagementandcontrol. Cost overruns can occur, however, especially on major automated projects, but can be managed by limiting liability and concentrating on core products. Nevertheless, it must be ensured that the necessaryresourcesareinplacetocarryoutprojects.

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Productrisks In order to maintain its competitiveness, the Demag Cranes Group works continuously to develop new products and improve the existing product range. Despite using cuttingedge project management, monitoring and control techniques, new product development entails considerable cost risk. This risk lies not only in the actual development phase, but also after market launch due to a possible need for technical improvements that can only be identified once products are in continuous operation under realuse conditions. Risks arising from product liability cannot be ruled out entirely. They may affect the Demag Cranes Group in the form of financial losses and damage to itsreputation.Insurancehasbeentakenouttocoverproductliabilityclaims. Strategicrisks Economicrisks Most of the products and services provided by the Demag Cranes Group can be allocated to the global market for cargo handling equipment and material logistics. Demand for such goods partly dependsonthegeneraleconomictrend. In the course of the short financial year from 1 October 2012 to 31 December 2012, economic growthslowedfurtherasaresultofthedebtcrisisintheeurozone. The Material Handling segments products are used in a diverse range of industries and serve a variety of customer groups. These include end customers who operate in cyclical sectors, i.e. in sectors particularly sensitive to changes in the economy as well as to global and regional trends. Demand for the Material Handling segment is heavily reliant on the economic cycle and is therefore subjecttofluctuations. The Port Solutions segment is dependent on worldwide cargo volumes and growth in container handling. Furthermore, revenue from automated products and services in this segment are mainly determinedbymajorprojectbusiness,whichbyitsnatureissubjecttocertainfluctuations. Risksrelatedtopricecompetition The Demag Cranes Group operates in markets characterised by intense competition and in some cases considerable price pressure resulting from the overcapacity caused by the financial and economic crisis. This price pressure is apparent in emerging economies and particularly so in mature markets. Here, technological benefits cannot always be given adequate consideration when making purchasing decisions owing to the sometimes very limited funds available for new investments. In ordertodevelopandmaintainacompetitiveedgeinspiteofthis,theDemagCranesGroupinvestsin developing products for differentiated customer and market segments as well as in expanding its distributionandservicenetwork.

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Competitiverisks Any company operating globally in the mechanical engineering sector faces risks arising from the activities of competitors. Observation of our competitors suggests that global competition will continue to rise in the Demag Cranes Groups product segments. We counter these risks by constantly monitoring the market and developing product, pricing and marketing strategies on the basisofourobservations.

Assessment of the risk situation and change in the risk position since financial year 2011/2012
As in the short financial year from 1 October 2012 to 31 December 2012, no risks were identified in the course of early risk detection activities in the past financial year that raised doubts about the abilityoftheGroupandDemagCranesAGtocontinueasagoingconcern. In the course of the short financial year from 1 October 2012 to 31 December 2012, the risk position did not significantly change compared with financial year 2011/2012. However, it is currently impossible to assess whether the trend in the global economy, the development of the debt crisis in severalcountriescouldcausetheriskpositionoftheGroupandDemagCranesAGtodeteriorate.

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Disclosures under Section 289 (5) and Section 315 (2) 5 of the German Commercial Code (main features of the internal control system and of the risk management system in relation to the financial reporting process) and explanatory report on these disclosures by theManagementBoardofDemagCranesAG
According to the explanatory memorandum to the German Accounting Law Modernisation Act (BilMoG),theinternalcontrolsystemencompassesthepolicies,processesandtasksthathelpensure effective and efficient financial reporting, the quality of the financial reporting and compliance with applicable law. This also includes the internal audit system to the extent that it relates to financial reporting. The risk management system in relation to the financial reporting process encompasses, as part of andhenceinthesamewayastheinternalcontrolsystem,financialreportingcontrolandmonitoring processes in particular with regard to items on the statement of financial position associated with themanagementofrisk.

Main features of the internal control system and of the risk management system in relationtothefinancialreportingprocess
The main features of the internal control and risk management system at Demag Cranes AG and in the Demag Cranes Group in relation to the (Group) financial reporting process may be described as follows: The Demag Cranes Group has a clear organisational, corporate, control and monitoring structure. Coordinated Groupwide planning, reporting, financial control and early warning systems and processes ensure integrated analysis and management of earningsrelated risk factors and goingconcernrisks. Functional responsibilities (e.g. accounting, financial control and internal audit) are clearly assignedforallpartsofthefinancialreportingprocess. AccountingITsystemsaresecuredagainstunauthorisedaccess. Mostfinancesystemsindeploymentarestandardsoftware. A suitable system of internal policies (including on Groupwide risk management and accounting)isinplaceandsubjecttoongoingrefinementinlinewithdevelopmentneeds. Departments involved in the financial reporting process meet quantitative and qualitative requirements. The completeness and accuracy of accounting data are regularly verified by sampling and plausibility checks performed both manually and by the software used. A risk controller for eachsegmentsupportstheriskmanagementprocessatsegmentleveland checksthedatafor plausibility.

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Keyprocessesrelatedtofinancialreportingaresubjecttoregularanalysis.TheGroupwiderisk management system is continuously adapted in line with current developments and regularly testedforeffectiveness. Thedualcontrolsystemisappliedthroughoutallprocessesrelatedtofinancialreporting. Processesrelatedtofinancialreportingaresubjecttoscrutinybytheinternalauditfunction. The Supervisory Board supervises matters including key aspects of financial reporting, risk managementandtheauditmandatetogetherwithitsmainpointsoffocus.

Explanatory notes on the main features of the internal control system and of the risk managementsysteminrelationtothefinancialreportingprocess
The internal control and risk management system in relation to the financial reporting process as set out above ensures that matters pertaining to the business are fully and accurately recognised, presentedandmeasuredintheaccountsandsoareincludedinexternalfinancialreporting. The internal control and risk management system at Demag Cranes AG also ensures that financial reporting in the Demag Cranes Group is uniform and in compliance with legal and statutory requirementsaswellasinternalcorporatepolicies.ThecentraltasksperformedbyDemagCranesAG include consolidating the figures, checking differences between actual and budgeted amounts, assessing recognised goodwill for impairment and examining the accounts to determine whether these have been kept correctly, the Groupwide accounting and financial control policies have been observed and the financial data thus meet regulatory requirements. This ongoing process is assured through the preparation of monthly accounts, in which the final amounts are checked by various units for plausibility, completeness and variance from the monthly budget. In addition to the accounting and financial control functions, this involves operations managers and, in some cases, internalauditasrequiredbytheannualauditplan. The purpose of the uniform Group risk management system, which fully meets the statutory requirements, is to identify risks in good time, assess them and communicate them appropriately. Report users are thus provided with accurate, relevant and reliable information. All Group member companies submit their financial data to Demag Cranes AG for consolidation in accordance with the uniformGroupreportingcalendar. The effectiveness of the internal control system in relation to the financial reporting process is regularly reviewed by internal audit, which has access to all data and audits individual areas and Group member companies in detail using sampling methods. In doing so, it examines whether the internal control system was implemented in this context, i.e. whether transactions were checked, andwhetherthedualcontrolsystemwasappliedinallareas,forexample. Working in close cooperation, the compliance management and internal audit functions perform spot checks to monitor compliance with internal codes and the relevant laws relating to compliance. Pointsoffocushereincludeanticorruptionarrangements. The uniform Group IT system incorporates authorisation procedures; if a subsidiary is audited by internal audit, these authorisation procedures and their implementation are also assessed.

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Automated controls and plausibility checks ensure the completeness and accuracy of data entries. In somecases,dataarevalidatedfullyautomaticallyanddiscrepancieshighlighted.

Reportonpostbalancesheetdateevents
On 14 January 2013, the Supervisory Board of Demag Cranes AG appointed Stoyan (Steve) Filipov as a member of the Management Board to act as Chief Operating Officer (COO). He simultaneously assumes the office of President of the Terex Material Handling & Port Solutions segments in the Terex Group. As soon as the process of integrating Demag Cranes into the Terex Group is further along, Aloysius Rauen will resign his post as CEO of Demag Cranes AG in the course of the current year and Stoyan Filipov will take over as CEO of Demag Cranes. Since 14 January 2013 the heads of theMaterialHandlingandTerexPortSolutionssegmentsreporttoStoyanFilipov.

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Forecastreport Introduction3
The following statements on the future development and performance of the Demag Cranes Group and the key underlying assumptions concerning market and industry developments are based on assessments which Demag Cranes AG considers realistic on the basis of the information currently available to it. They nevertheless involve a high degree of uncertainty and an unavoidable risk that forecast developments may not actually occur, either in the general pattern or to the extent anticipated. Growth momentum of the global economy is expected to remain subdued in 2013. Some positive indications are emerging, however. In the USA, economic growth is expected to rebound in 2013 afteraslightcontractioninthefourthquarterof2012.InChina,growthappearstobestabilisingata sustainablelevel.Theeurozonewillseedivergenteconomictrends,withthesovereigndebtcrisesin the peripheral countries representing the greatest challenge for economic policymakers again in 2013. In its forecast from November 2012, the Organisation for Economic Cooperation and Development (OECD) said it expects the euro zone to remain in a slight recession overall in 2013 as well. In the Material Handling segment, business with new cranes is a latecycle business that, from past experience,respondswithatimelagtocyclicalchangesintheoveralleconomy.Thereisariskofthe ongoing uncertainty in connection with the European sovereign debt crisis leading to further cyclic slowdown. This may impact new business with industrial cranes in the shape of lower capital expenditure by our customers. In light of this, we estimate the growth opportunities for 2013 to be moderate overall. However, we will also adapt our procurement, production, sales, service, marketing and organisation functions to these new market circumstances through comprehensive costcuttingprogrammes. In our view, growth prospects in the Material Handling segment arise from advancing industrialisation in emerging markets and the accompanying trend towards increased production efficiency. This favours demand for highquality crane components. We aim to develop further potential by expanding the product portfolio in the midrange product/price bracket, as provided for inourstrategyfortheBRICstates.Suchpotentialisavailableontheonehandinemergingmarkets evenifestablishingsupplychainsandnewdistributionchannelsinsuchregionsalreadyshowedsigns during the 2011/2012 financial year of posing more of a challenge than initially expected. On the otherhand,wealsoseegrowthopportunitiesfortheseproductsinmaturemarketsgiventheshiftin customers investment behaviour as a result of the economic and financial crisis as well as the current economic uncertainties. We have already expanded our product portfolio accordingly and will continue in the same vein so that we can respond flexibly to changing customer needs. The joint venture with the Chinese Weihua Group must be regarded as a further pillar of growth and a strategically important step in intensifying our development of the Chinese market. We continue to

BundesministeriumfrWirtschaftundTechnologie,SchlaglichterderWirtschaftspolitik,January2013; Commerzbank,EconomicResearch,KonjunkturundFinanzmrkte,December2012

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expectgrowthwiththeservicesofferedintheMaterialHandlingsegment.Ingeneral,ourworldwide customers show an ongoing trend towards outsourcing and switching to professional maintenance services. Moreover, our customer base in emerging markets is expanding. We see additional growth potential here notably due to increasing security requirements. At the same time, the performance of the Services business remains dependent on industrial capacity utilisation, which has been adversely affected by uncertainty in connection with the debt crisis, particularly in mature markets. However, based on our strategy of taking on increasing functional responsibility and offering a broader selection of services, there is additional potential for increases in these markets too, includingfornonDemagcranesandloadhandlingattachments. Under the given conditions, market growth in the Port Solutions segment for financial year 2013 is heavily dependent on our customers business performance and market opportunities. Despite the current climate of uncertainty, we see a positive trend in the growth projections from Drewry Shipping Consultants for container and bulk cargo transhipments because, from experience, any increase in transhipment rates drives corresponding demand for port and handling technology. Innovative products, however, continue to provide additional opportunities in port technology as elsewhere. The batterypowered, zeroemission Automated Guided Vehicle (AGV), which has now been ordered by terminal operators in Rotterdam, remains a prime example of this. We also see the current growth in the terminal systems business as an opportunity to benefit from growth potential and to demonstrate our expertise for followup projects. The amalgamation of the activities of Terex andGottwaldPortTechnologyinTerexPortSolutionseachofwhichwasalreadyamajorsupplierin the ports sector on its own means we can serve port technology customers and meet their needs tothebestpossibleextentfromasinglesource.

BusinessoutlookfortheDemagCranesGroup
Having appropriately weighed up the opportunities and risks, we expect overall order intake, revenue volume and operating EBIT worldwide in the Material Handling segment to increase only moderately in the next 1224 months, excluding the effects of changes in the composition of the group. The development of demand for industrial cranes must be viewed separately by market. We expect stagnation and potentially even a decline in demand in central Europe, mainly as a result of the crisisrelated uncertainty on the previously stable markets of Germany, Austria and Switzerland. Wealsoexpectstagnationindemandinmarketsthathavebeenaffectedbythecrisisforsometime. While we generally expect slight growth in the Services business, excluding the effects of changes in the composition of the group, the development of the service business remains dependent on the industrys capacity utilisation, which may continue to be negatively impacted by the uncertainty surroundingthedebtcrisis. We also anticipate moderate growth in order intake, revenue and operating EBIT in the Port Solutions segment in the next 1224 months, of which our Mobile Harbour Cranes constitute the basic business. Marketing of the newly designed compact harbour crane could provide additional impetus. Furthermore, revenue recognised from the two major projects in the Netherlands will have a significant impact on segment revenue. We expect the price pressure and fierce competition to persistinthePortSolutionssegmentaswell. Forthenext12monthsweseerevenuefortheDemagCranesGroupasawholetobebelowthoseof the 2011/2012 financial year (EUR 1,123 million). This is mainly due to the sale of companies to Terex, (see Annual Report 2011/2012 section report on post balance sheet date events), which represented about 13% of group sales and 7% of group operating EBIT in the 2011/2012 financial year. Operating EBIT margin for the next 12 months is expected to be stable compared with the

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financial l year 2011/ /2012 (7.9% %) provided t that our rev venue projection is atta ained. Capex x for the Groupw willamountto oapproxima ately2%to3 3%ofrevenue. However, the development of raw materia als prices an nd energy co osts, which a according to o current nue to rise, constitutes s a risk fact tor. The exp pected price e rises could d have a forecasts will contin negative e impact on the cost bas se. However, , we will end deavour to counteract c t hese factors s through extensiv vecostcuttin ngprogramsandincrease edefficiency y,soastooff fsetanyeffe ects. It is very y difficult to predict how w the busine ess will develop over the e following y years due to the high al Handling segment degree o of uncertain nty in the ov verall econo omy. Since the trend in the Materia depends s heavily on demand for capital good ds and capac city utilisatio on in the ind dustry, we be elieve we can achieve further r growth if the conditio ons are favo ourable. The e Port Solut tions segme ent relies consider rablyonthedevelopmen ntofcontain erandbulkcargotransh hipments,sin nceanyincre easehere boosts d demand for r handling equipment. e If these ind dicators con ntinue to de evelop in a positive direction n, then we believe b we are a very welll positioned especially y with the e entire complimentary product portfolio of f Terex Port Solutions to participa ate in this market m growt th. We woul ld expect that ope erating EBIT will improve e in line wit h the revenue growth. The T trend in n raw material prices andenergycostsand dthepricing genvironmen ntnonethele essconstitute eriskfactors s. orf,25March2013 Dsseldo AloysiusRauen wood LawrenceLockw StoyanFili ipov

ConsolidatedFinancialStatements
fortheshortfinancialyear 1October2012to31December2012

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Tableofcontents
Statementofcomprehensiveincome......................................................................................... 59 Statementoffinancialposition.................................................................................................. 60 Statementofchangesinequity.................................................................................................. 62 Statementofcashflow ............................................................................................................... 63 NotestotheConsolidatedFinancialStatements ......................................................................... 64
1. 2. 3. 4. 5. 6. Generalinformation......................................................................................................................................64 Basisofpreparation.......................................................................................................................................64 Newandrevisedstandardsandinterpretations........................................................................................... 65 Accountingpolicies........................................................................................................................................68 Accountingestimatesandjudgements......................................................................................................... 82 ConsolidatedGroup.......................................................................................................................................84

Notestothestatementofcomprehensiveincome..................................................................... 86
7. 8. 9. 10. 11. 12. 13. 14. Revenue.........................................................................................................................................................86 Selling,generalandadministrativeexpenses................................................................................................ 86 Researchanddevelopmentexpenses........................................................................................................... 86 Otheroperatingincomeandotheroperatingexpenses.............................................................................87 Incomefrominvestmentsaccountedforusingtheequitymethod............................................................87 Interestandsimilarincomeandinterestandsimilarexpenses..................................................................87 Incometax...................................................................................................................................................87 Earningspershare.......................................................................................................................................88

Notestothestatementoffinancialposition ............................................................................... 89
15. 16. 17. 18. 19. 20. 21. 22. 23. 24. 25. 26. 27. 28. 29. 30. 31. Goodwillandotherintangibleassets.......................................................................................................... 89 Property,plantandequipment................................................................................................................... 93 Investmentproperty....................................................................................................................................96 Investmentsaccountedforusingtheequitymethod................................................................................. 97 Otherinvestments.......................................................................................................................................97 Tradereceivablesandotherfinancialassets............................................................................................... 98 Othernonfinancialassets......................................................................................................................... 100 Inventories.................................................................................................................................................100 Cashandcashequivalents......................................................................................................................... 101 Noncurrentassetsheldforsaleandassociatedliabilities ........................................................................101 Shareholdersequity..................................................................................................................................102 Provisionsforpensionsandsimilarobligations......................................................................................... 104 Otherprovisions........................................................................................................................................108 Loansandborrowings ................................................................................................................................109 Tradepayablesandotherfinancialliabilities............................................................................................ 110 Othernonfinancialliabilities.................................................................................................................... 110 Deferredtax...............................................................................................................................................111

Otherdisclosures...................................................................................................................... 113
32. 33. 34. 35. 36. 37. 38. 39. 40. Statementofcashflow.............................................................................................................................. 113 Segmentreporting.....................................................................................................................................114 Additionaldisclosuresonfinancialinstruments........................................................................................ 117 Capitalmanagement..................................................................................................................................126 Contractualcommitments......................................................................................................................... 127 Contingentliabilitiesandotherobligations ............................................................................................... 128 Relatedparties...........................................................................................................................................129 Personnelexpensesandnumberofemployees........................................................................................ 131 Corporategovernancecode...................................................................................................................... 131

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41. 42. 43. 44. 45.

ExemptionunderSection264(3)oftheGermanCommercialCode........................................................131 Auditorsfees.............................................................................................................................................132 Eventsafterthebalancesheetdate.......................................................................................................... 132 Subsidiaries,jointventuresandinvestmentsasat31December2012....................................................133 Mandates...................................................................................................................................................138

Responsibilitystatement........................................................................................................... 143 Auditorsreport........................................................................................................................ 144

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Statementofcomprehensiveincome
1Octoberto31December
inEURthousand Revenue Costofsales Grossprofit Selling,general andadministrative expenses Researchanddevelopmentexpenses Otheroperatingincome Otheroperatingexpenses Income frominvestmentsaccountedforusingthe equitymethod Earningsbefore interestandtax(EBIT) Interestandsimilarincome Interestandsimilarexpenses Earningsbefore tax(EBT) Income tax Netincome aftertax Ofwhich attributable tothe shareholdersofDemagCranesAG attributable tononcontrollinginterest Differencesarisingfromcurrencytranslation Changesinthefairvalue ofavailable for sale financial instruments Deferredtax Netincome recognisedinequitythatcanbe reportedinthe Statement ofIncome Actuarial gains/losses Deferredtax Netincome recognisedinequitythatcannotbe reportedinthe StatementofIncome Netincome recogniseddirectlyinequityaftertax Totalrecognisedincome andexpense aftertax Ofwhich attributable tothe shareholdersofDemagCranesAG attributable tononcontrollinginterest Earningspershare (inEUR) 25 25 25 25 25 Note 7 ShortFY2012 227,140 175,134 52,006 59,021 4,863 74,331 3,614 1,030 59,869 782 2,949 57,703 134 57,569 57,396 173 4,767 4 1 2011/2012 1,123,267 806,360 316,906 231,502 18,325 71,207 11,949 3,919 130,256 3,158 16,449 116,966 32,185 84,781 84,506 275 7,410 29 7

8 9 10 10 11 12 12 13

4,770 9,909 6 9,916 14,686 42,883 42,734 149 2.71

7,432 42,488 2,502 44,991 37,559 47,222 46,890 333 4.00

14

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Statementoffinancialposition

Assets inEURthousand Goodwill Otherintangible assets Property,plantandequipment Investmentproperty Investmentsaccountedforusingthe equitymethod Otherinvestments Trade receivables Otherfinancial assets Othernonfinancial assets Deferredtaxassets Noncurrentassets Inventories Advance paymentsmade Trade receivables Otherfinancial assets Tax receivables Othernonfinancial assets Cashandcashequivalents Subtotalofnoncurrentassets Available forsale assets Currentassets Assets Note 15 15 16 17 18 19 20 20 21 31 22 20 20 21 23 24 31December2012 30September2012 95,071 43,130 115,980 178 25,177 730 533 1,603 8 12,807 295,216 187,999 6,060 148,745 173,000 2,950 16,152 54,122 589,029 95,093 43,294 113,678 179 25,041 733 656 1,689 10,960 291,323 188,027 4,072 147,206 16,742 2,745 18,163 55,947 432,901

78,275 589,029 511,176 884,245 802,499

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Shareholdersequityandliabilities inEURthousand Subscribedcapital Additional paidincapital Otherreserves EquityattributabletoshareholdersofDemagCranesAG Equityattributable tononcontrollinginterest Equity Provisionsforpensionsandsimilarobligations Otherprovisions Loansandborrowings Otherfinancial liabilities Othernonfinancial liabilities Deferredtax liabilities Noncurrentliabilities Advance paymentsreceived Otherprovisions Loansandborrowings Trade payables Otherfinancial liabilities Tax liabilities Othernonfinancial liabilities Subtotalofnoncurrentliabilities Available forsale liabilities Currentliabilities Shareholdersequityandliabilities

Note 31December2012 30September2012 25 25 25 25 25 25 26 27 28 29 30 31 21,173 188,943 46,913 257,029 1,805 258,834 200,630 2,600 699 8,191 8,812 2,169 223,101 150,881 23,639 86,755 44,643 36,910 20,571 38,912 402,309 402,309 884,245 21,173 188,943 64,353 274,469 1,657 276,126 183,691 2,681 794 7,945 10,084 2,114 207,308 86,945 22,897 8,780 48,857 42,362 23,842 50,050 283,732 35,333 319,065 802,499

27 28 29 29 30 24

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Statementofchangesinequity
Subscribed Additionalpaid capital incapital Equity attributableto Equityattributable shareholdersof tononcontrolling interest DemagCranesAG

inEURthousand Balance at1October2011 Dividendspaid ProfittransfertoTerex Share basedpayment Transactionswithshareholders Totalrecognisedincome and expense aftertax Balance at30September2012 Balance at1October2012 Dividendspaid ProfittransfertoTerex Share basedpayment Transactionswithshareholders Totalrecognisedincome and expense aftertax Balance at31December2012

21,173 21,173 21,173 21,173

Otherreserves Accumulatedothercomprehensive Retainedearnings income Differencesarising fromcurrency Available forsale translation Actuarial gains/losses Otherreserves financial assets 190,963 7,942 40,690 38 3,800 2,020 2,020 188,943 188,943 188,943 44,983 52,925 52,925 9,909 62,834 847 18,198 19,045 84,506 106,150 106,150 60,175 60,175 57,396 103,371 22 16 16 3 19 7,345 11,145 11,145 4,750 6,395

Equity

248,645 847 18,198 2,020 21,066 46,890 274,469 274,469 60,175 60,175 42,734 257,029

1,386 62 62 333 1,657 1,657 149 1,805

250,032 909 18,198 2,020 21,128 47,222 276,126 276,126 60,175 60,175 42,883 258,834

FurtherinformationisprovidedinNote25.

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Statementofcashflow
1Octoberto31December
inEURthousand Netincome aftertax Income tax Interestandsimilarexpenses,net Depreciation,amortisationandimpairments EBITDA Change ininventories Change intradereceivables Change intradepayables Change inadvance paymentsmade/received,net Gain/lossondisposal ofnon currentassets Income frominvestmentsaccountedforusingthe equitymethod Dividendsreceivedfrominvestmentsaccountedforusingtheequitymethod Change inotherfinancial/nonfinancial assets/liabilities Cashflowfromoperatingactivitiesbefore interestandtax Interestreceived Interestpaid Income taxpaid Cashflowfromoperatingactivities Purchaseof businesses Purchaseof intangible assetsandpropertyplantandequipment Proceedsfromthe sale ofbusinesses Proceedsfromthe sale ofintangible assetsandpropertyplantandequipment Cashflowfrominvestingactivities Freecashflowbeforefinancing(FCF) Payments/proceedsfromloansandborrowings* Paymentof profitandlosstransfertoTerexGermanyGmbH&Co.KGforthe prioryear Share basedpayments Dividendspaidtominorityshareholders DividendspaidtoDemagCranesAGshareholders Cashflowfromfinancingactivities Effectofforeignexchangeratechangesonfree cashflow Netincrease/decrease incashandcashequivalents Cashandcashequivalentsasat1October Effectsof foreignexchange rate changesoncashandcashequivalents Effectsof assetsheldforsale oncashandcashequivalents Cashandcashequivalentsasat31December/30September Ofwhichrestricted Freecashflowbeforefinancing,interestandtax payments *Ofwhichrepaymentof EUR0inshortfinancial year2012forthe revolvingcreditfacility(2011/2012:EUR122,654,000) ShortFY2012 57.569 134 2.166 5.247 65.117 3.920 5.304 11.964 62.510 67.546 1.030 610 62.152 248 592 1.357 933 1.449 8.091 77.247 128 69.284 67.835 55.816 18.198 74.015 1.025 7.204 55.947 1.122 6.501 54.122 1.041 70.124 2011/2012 84.781 32.185 13.290 21.567 151.823 14.671 10.462 22.635 14.554 57.231 3.919 4.209 26.093 64.916 2.394 7.753 18.844 40.714 22.272 96.501 166 74.395 115.109 162.213 2.194 62 847 165.316 2.976 47.231 107.606 1.470 5.897 55.947 1.082 139.311

*this includes EUR60,175,000(2011/2012: EUR18,198,000)for thecurrentfinancialyearinallocationfrom financialliabilities

FurtherinformationonthestatementofcashflowisprovidedinNote32.

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NotestotheConsolidatedFinancialStatements
1. Generalinformation
Demag Cranes AG is a Germanybased stock corporation. Demag Cranes AG is registered under registration number HRB 54517 in the commercial registry at Dsseldorf local court. The address of itsregisteredofficeisForststrasse16,40597Dsseldorf,Germany. Demag Cranes comprises the segments Material Handling and Port Solutions. The business ranges from the development and design of technically advanced cranes and hoists to automated transport andlogistics systemsforportsandterminals,the provisionofservicesrelatingtothese productsand themanufactureofhighqualitycomponents. The Management Board of Demag Cranes AG has prepared the Consolidated Financial Statements and submitted them to the Supervisory Board on 25 March 2013. The Consolidated Financial StatementsaretobereleasedforpublicationintheirpresentformattheSupervisoryBoardMeeting on26March2013. Demag Cranes AG has been a subsidiary of Terex Industrial Holding AG, Dsseldorf, since 16 August 2011 and is included in the Consolidated Financial Statements of Terex Corporation, Westport, Connecticut,USA. AttheAnnualGeneralMeetingon27August2012,itwasdecidedtochangethefinancialyeartothe 31 December reporting date. This resulted in a short financial year from 1 October 2012 to 31 December2012. The threemonth short financial year means that there is only restricted comparability with the twelvemonthprioryear,mostnotablywithregardtothestatementofcomprehensiveincome.

2. Basisofpreparation
The Consolidated Financial Statements of Demag Cranes AG for the short financial year 1 October 2012 to 31 December 2012 are prepared in accordance with the International Financial Reporting Standards (IFRS) issued by the International Accounting Standards Board (IASB) and the Interpretations of the International Financial Reporting Standards Interpretations Committee (IFRS IC) applicable at the balance sheet date and as adopted by the European Union (EU). The supplementaryrequirementsinSection315a(1)oftheGermanCommercialCodearealsomet. The statement of comprehensive income combines the income statement and net income recognised directly in equity. It is prepared using the cost of sales method. Assets and liabilities are presented in the statement of financial position using a current/noncurrent classification. Certain items in the statement of comprehensive income and the statement of financial position are combinedforthesakeofclarity.TheseitemsareexplainedintheNotes. TheConsolidatedFinancialStatementsarepreparedonahistoricalcostbasiswiththeexceptionthat derivative financial instruments and availableforsale financial assets are measured at fair value wherethiscanbereliablydetermined.

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Preparation of the Consolidated Financial Statements has required the use of estimates and assumptions that affect the recognition and measurement of assets and liabilities, the amounts of expense and income items, and disclosures relating to contingent assets and contingent liabilities. Material judgements that the Management Board has made in applying IFRS are described along with the main estimates whose review may result in material changes in the next financial year in Note5,Accountingestimatesandjudgements. The Consolidated Financial Statements are prepared in euros, the functional currency of Demag Cranes AG. All figures are rounded to the nearest thousand euros unless otherwise stated. All percentages relate to figures stated to the nearest euro. The amount shown for each individual item and total is the figure with the smallest rounding difference. Reported totals may therefore differ slightlyfromthesumoftheindividualreportedamounts.

3. Newandrevisedstandardsandinterpretations Newstandardsandinterpretationseffectiveintheshortfinancialyear2012 Thefollowingneworrevisedstandardswereeffectiveinthepastshortfinancialyear:


IAS 1: Presentation of financial statements Presentation of items of other comprehensive income

The amendments relate to the presentation of items of other comprehensive income in the statement of comprehensive income. Items of other comprehensive income must be grouped into items that can be recycled (reclassified to profit or loss) subsequently and those that cannot be recycled(notreclassifiedtoprofitorloss)subsequently. ThereisnomaterialimpactontheGroupsfinancialpositionandfinancialperformance.

Standardsandinterpretationseffectiveinlaterfinancialyears
A number of International Financial Reporting Standards issued by the IASB and endorsed by the EU areeffectiveforfutureperiodsandDemagCraneshasnotelectedearlyadoption. IAS19:Employeebenefits

The amendments mainly relate to the elimination of the corridor method for the recognition of actuarial gains and losses, a restructuring of pension expense, a redefinition and thus a change in accountingfortopupamountsunderpartialretirementplans,andadditionalnotesdisclosures. Elimination of the corridor method does not affect Demag Cranes, as actuarial gains and losses are alreadyrecognisedinothercomprehensiveincome.TheremainingchangeswillaffectDemagCranes. The amended IAS 19 is effective for annual periods beginning on or after 1 January 2013. Demag Cranes does not expect that the changes in accounting requirements will have a significant effect on theGroupsfinancialpositionandfinancialperformance.

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IAS12:IncomeTaxes

In December 2010, the IASB issued an amendment to IAS 12 (Income Taxes). This amendment introducesarebuttablepresumptionthatthecarryingamountofanassetwillnormallyberecovered through sale rather than use. The change is particularly relevant for the calculation of deferred taxes in countries where the income tax rates on gains from divestments differ from those on regular rental income, for example. In this connection, SIC21 (Income Taxes Recovery of Revalued Non Depreciable Assets) was integrated into IAS 12 (Income Taxes), except where it relates to real estate heldasinvestmentproperty.Therevisedstandardis tobeappliedretrospectivelyforannualperiods beginning on or after 1January 2013. The new standard will not have a material impact on the presentationoftheGroupsfinancialpositionorresultsofoperations. Consolidationstandards:IFRS10,IFRS11,IFRS12,IAS27,IAS28

In May 2011 the IASB published four new standards: IFRS 10 (Consolidated Financial Statements), IFRS 11 (Joint Arrangements), IFRS 12 (Disclosure of Interests in Other Entities) and IFRS 13 (Fair Value Measurement). It also published amendments to two existing standards, IAS 27 (Separate Financial Statements) and IAS 28 (Investments in Associates and Joint Ventures). Application is mandatoryforannualperiodsbeginningonorafter1January2014.Theimpactthechangeswillhave onthepresentationofitsfinancialpositionandresultsofoperationsiscurrentlybeingevaluated. IFRS 10 (Consolidated Financial Statements) lays down the criteria for the inclusion of a companys participating interests in its consolidated financial statements irrespective of the nature of the interest. The criteria are based on a principle of control defined in the standard, which also contains detailed instructions for applying this principle. IFRS 10 thus entirely replaces the corresponding provisions of IAS 27 (Consolidated and Separate Financial Statements) and SIC12 (Consolidation SpecialPurposeEntities). IFRS 11 (Joint Arrangements) prescribes the accounting for joint arrangements over which control is shared with a third party. The accounting treatment is determined by the rights and obligations resultingfromthejointarrangementratherthanbythelegalformasinthepast.Jointarrangements are classified as either joint operations or joint ventures. Each party to a joint operation must in future recognize its shares of the operations assets and liabilities in accordance with its rights and obligations. Investments in joint ventures are to be accounted for using the equity method. IFRS 11 supersedes IAS 31 (Interests in Joint Ventures) and SIC13 (Jointly Controlled Entities Non MonetaryContributionsbyVenturers). TheIASBhasrevisedIAS28(InvestmentsinAssociatesandJointVentures)toaddresstheaccounting forinvestmentsinbothassociatesandjointventuresusingtheequitymethod. IFRS 12 (Disclosure of Interests in Other Entities) prescribes the information to be disclosed in the notes to the financial statements about interests in subsidiaries, associates, joint arrangements and nonconsolidated structured entities. The objective of these disclosures is to enable the users of an entitys financial statements to understand the nature of its interests in other entities, the risks

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associated with them, and the effects of the interests on its financial position and results of operations. In light of the amendments made by IFRS 10 (Consolidated Financial Statements) and IFRS 12, the IASB published a revised version of IAS 27 (Separate Financial Statements), which is now devoted entirely to accounting for interests in subsidiaries, associates and joint ventures in IFRS separate financialstatements. IFRS13FairValueMeasurement

In May 2011 the IASB published the new IFRS13 (Fair Value Measurement). The standard must be applied prospectively for annual periods beginning on or after 1January 2013. The impact the changes will have on the presentation of its financial position and results of operations is currently being evaluated. In IFRS 13 (Fair Value Measurement), the IASB provides a uniform definition of fair value and how it is measured and specifies the related information to be provided in the notes. This standardprescribeshowratherthanwhenanassetorliabilityistobemeasuredatfairvalue,the fair value being defined as the price that would be received to sell an asset or paid to transfer a liability. IAS32FinancialInstrumentsOffsettingFinancialAssetsandLiabilities InDecember2011theIASBissuedOffsettingFinancialAssetsandFinancialLiabilities(Amendments to IAS 32) and Disclosures Offsetting Financial Assets and Financial Liabilities (Amendments to IFRS 7). The amendments to IAS 32 (Financial Instruments: Presentation) clarify what is meant by right of setoff in all circumstances and simultaneous settlement. The amendments to IFRS 7 (Financial Instruments: Disclosures) require gross and net offsetting amounts reflected in the statement of financial position along with other existing rights of setoff that do not meet the requirements for setoff in the statement of financial position to be presented in tabular form in future. The amendments are required to be applied retrospectively for annual and interim periods beginning on or after 1January 2013 (IFRS 7 amendments) or 1January 2014 (IAS 32 amendments). The impact the changes will have on the presentation of its financial position and results of operationsiscurrentlybeingevaluated. The IASB and the IFRS Interpretations Committee have issued the following standards, amendments to standards, and interpretations whose application is not yet mandatory and is conditional upon theirendorsementbytheEuropeanUnion. IFRS9:FinancialInstruments

In November 2009 the IASB issued IFRS 9 (Financial Instruments), containing rules for the classification and measurement of financial assets. In October 2010 it issued new requirements for the classification and measurement of financial liabilities, incorporating them into IFRS 9. This marks thecompletionofthefirstpartofathreepartprojecttocompletelyrevisetheaccountingtreatment

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of financial instruments. The new standard defines two instead of four measurement categories for financialassets,withclassificationtobebasedpartlyonthecompanysbusinessmodelandpartlyon the characteristics of the contractual cash flows from the respective financial asset. An embedded derivativeinastructuredproductwillnolongerhavetobeassessedforpossibleseparateaccounting treatment unless the host is a nonfinancial contract. A hybrid contract that includes a financial host mustbeclassifiedandmeasuredinitsentirety.AnamendmentpassedinDecember2011postponed the mandatory effective date of IFRS 9 to annual periods beginning on or after January 1, 2015. The disclosure requirements under IFRS 7 concerning the firsttime application of IFRS 9 were amended at the same time. IFRS 9 has not yet been endorsed by the European Union. The changes will not haveamaterialimpactonthepresentationoftheGroupsfinancialpositionorresultsofoperations. AnnualImprovementsProcess

In May 2012 the IASB published the fourth Annual Improvements to IFRSs under its annual improvements project. The amendments define more precisely the recognition, measurement and reporting of transactions, standardise terminologies and are mainly to be regarded as editorial corrections toexistingstandards.Theamendmentscomeinto effectforannual periodsbeginningon orafter1January2013.TheyhavenotyetbeenendorsedbytheEuropeanUnion. AmendmentforApplicationoftheConsolidationStandards(IFRS10,11and12)

The amendments on Consolidated Financial Statements, Joint Arrangements and Disclosure of InterestinOtherEntities: Transition Guidance toIFRS10,11and12issued by IASBin June 2012are designed to clarify and provide transition relief for these standards and are mandatory for annual periods beginning on or after 1January 2014. They have not yet been endorsed by the European Union.

4. Accountingpolicies
The accounting policies set out in the following correspond to the methods applied in the previous financialyear.

Subsidiaries
Subsidiaries are companies that are controlled by Demag Cranes AG, meaning that Demag Cranes AG, by virtue of holding a majority of their voting rights or through other means, has the power to governtheirfinancialandoperatingpoliciessoastoobtainbenefitsfromtheiractivities.Subsidiaries are included in the Consolidated Financial Statements from the date Demag Cranes AG obtains control and cease to be included when control is lost. The results of subsidiaries acquired and disposedofduringtheyearareincludedinthestatementofcomprehensiveincomefromthedateof acquisitionanduptothedateofdisposal. The Consolidated Financial Statements are prepared on the basis of uniform accounting policies. All intraGrouptransactionsincludingtheresultingbalances,incomeandexpensesareeliminatedinfull.

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Noncontrolling interests are measured at the noncontrolling interests proportionate share of the net assets of consolidated subsidiaries. Demag Cranes has not elected to apply the alternative treatment of measuring noncontrolling interests at fair value. Noncontrolling interests are identified separately from the equity attributable to shareholders of Demag Cranes AG. The same item includes noncontrolling interests in total recognised income and expense for the period and in each component of total recognised income and expense. This allocation of annual changes in net assetsismadeevenifitresultsinthenoncontrollinginterestshavingadeficitbalance. Investments in subsidiaries that are of minor overall significance to the presentation of the financial position and financial performance of the Group are measured at cost less any impairments and accountedforunderotherinvestmentsasinvestmentsinassociates. All subsidiaries of Demag Cranes AG are shown in the list of subsidiaries, joint ventures and investmentsasat31December2012,aftertheNotestotheConsolidatedFinancialStatements.

Interestsinjointventures
DemagCranesAGincludesonejointventure(MHEDemag(S)Pte.Ltd.,Singapore)initsConsolidated FinancialStatements.AjointventureisacontractualarrangementwherebyDemagCranesAGandat leastoneotherthirdpartydirectlyorindirectlyundertakeaneconomicactivitythatissubjecttojoint control. The Groups investment in the joint venture is accounted for in the Consolidated Financial Statementsusingtheequitymethod. The interest in a joint venture accounted for using the equity method is initially recognised in the statement of financial position at cost. The carrying amount is subsequently increased or decreased bychangesinDemagCranesshareofthenetassetsofthejointventureafterthedateofacquisition and by any impairment of its interest in the joint venture. IntraGroup transactions are eliminated in proportion with Demag Cranes interests in it. If the Groups share of losses from a joint venture exceedsthecarryingamountofitsinterestinthejointventureconcerned,suchlossesareonlytaken into account to the extent that Demag Cranes has incurred legal or constructive obligations to cover them. The joint ventures financial year is the calendar year. The figures included are based on interimfinancialstatementswhosereportingdateissetbackbyonemonth. The share of profit or loss from income from investments accounted for using the equity method reportedinthestatementofcomprehensiveincomeisDemagCranesshareofprofitorlossfromthe jointventure. The joint ventures are shown in the list of subsidiaries, joint ventures and investments as at 31 December2012,aftertheNotestotheConsolidatedFinancialStatements.

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Currencytranslation
The Consolidated Financial Statements are prepared in euros, the functional currency of Demag Cranes AG. The financial statements of foreign entities included in the Consolidated Financial Statements are prepared in local currency, which is the functional currency of the companies concerned. Transactions in currencies other than the applicable functional currency are translated at the average spot exchange rate prevailing at the date of the transaction. Monetary items (such as payablesandreceivables)denominatedinforeigncurrenciesaretranslatedintoeurosattheaverage spot exchange rate prevailing on the balance sheet date. Nonmonetary items are translated at historical exchange rates. Exchange differences arising on the translation of monetary balance sheet items into functional currency are recognised under other operating income or under other operating expenses, except gains and losses on foreign currency transactions relating to financing activities,whicharerecognisedininterestandsimilarincomeorininterestandsimilarexpenses. The financial statements of foreign subsidiaries included in the Consolidated Financial Statements with functional currencies other than the euro are translated from local currency into the Group presentation currency (euros). The assets and liabilities of foreign subsidiaries are translated using the exchange rates prevailing at the balance sheet date. Equity items are translated at the historical exchange rates prevailing at their recognition date. Income and expenses are translated at the average exchange rates for the period. Exchange differences arising on the translation of foreign entity financial statements are reported in equity as a net amount under other comprehensive income. On disposal of a foreign entity, any accumulated net gains or losses are recognised in profit or loss. The accumulated exchange differences reported in equity as at 31 December 2012 mainly relatetotheGroupscompaniesintheUK,theCzechRepublicandChina. TheexchangeratesusedformajorcurrenciesintheConsolidatedFinancialStatementsareasfollows (inforeigncurrencyunitspereuro):
EURexchange rateprevailingon thebalancesheetdate 31December 2012 1.31850 0.81550 11.18880 25.12100 8.27400 1.20730 2.71860 72.91300 30September 2012 1.29220 0.79820 10.67640 25.15500 8.11500 1.20950 2.61360 68.32900 AverageEURexchangerateforthe period 1Oct.201231 Dec.2012 1.29659 0.80727 11.27637 25.16494 8.09757 1.20794 2.66475 70.09371 1Oct.201131 Dec.2012 1.30388 0.82777 10.48915 25.17533 8.27420 1.21214 2.43299 67.99017

Country

ISOcode

USA UK SouthAfrica CzechRepublic China Switzerland Brazil India

USD GBP ZAR CZK CNY CHF BRL INR

Revenueandincomerecognition
Revenue from the sale of goods is recognised when the significant risks and rewards ofownership of the goods have transferred to the buyer, the amount of revenue is reliably measurable and it is probablethattheeconomicbenefitsassociatedwith thetransactionwillflowtotheGroup. Revenue from the sale of goods where installation is a significant part of the contract is not recognised until the ordered goods have been delivered to the customer and installed. Revenue from the sale of

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spare parts is recognised on delivery. In multipleelement sales transactions, Demag Cranes applies separaterecognitioncriteriatorevenuefromthesaleofgoodsandrevenuefromrenderingservices. Revenue from rendering services is recognised, subject to the satisfaction of recognition criteria, by reference to the stage of completion of the transaction at the balance sheet date. In certain instances involving revenue from construction contracts, profit is recognised on a percentage of completion basis. Demag Cranes determines the percentage of completion for this purpose according to contract costs incurred to date as a percentage of total contract costs (the costtocost method). Expected contract losses are recognised as an expense in the period in which estimated totalcontractcostsarefoundtoexceedtotalcontractrevenues.Revenueisreportedafterdeducting anytradediscountsandrebates. Rental income from investment properties and other operating leases is recognised under other operating income in profit or loss on a straightline basis over the duration of the tenancy. Any premiumpaidforanoperatingleaseisallocatedtoaccountingperiodsaspartoftotalleaseincome. Dividend revenue on investments is recognised when the right to receive payment is established. Interest revenue is recognised in the amount of the effective yield on invested capital. The effective yieldistherateofinterest required todiscountthestreamoffuturecashreceiptsexpectedoverthe lifeofafinancialassettoequatetothenetcarryingamountoftheasset. Ondisposalofanasset,anydifference betweenthe proceedsfromthesaleandthecarryingamount isrecognisedinprofitorloss.

Costofsales
The cost of sales reported in the statement of comprehensive income consists of all costs directly attributable to the production process. These include direct material and direct labour, allocable overheads such as depreciation, productionrelated administrative overheads, impairments of productionrelatedtangibleandintangibleassets,andinventorywritedowns.

Researchanddevelopmentexpenses
Researchexpensesarerecognisedintheperiodinwhichtheyareincurred. Expenditure is incurred for development activities when research findings or other knowledge are applied to a plan or design for the production of new or substantially improved products or processes. Demag Cranes recognises an intangible asset arising from development if the outcome is technicallyand commerciallyfeasibleanditis considered probablethatthe productorprocesstobe developed will generate future economic benefits. The development expenditure recognised as an intangible asset includes direct material, direct labour and allocated overheads. Other development expensesarerecognisedasexpenseincostofsaleswhenincurred.Furtherinformationisprovidedin Note9. Capitalised development expenses are presented in the statement of financial position net of accumulated amortisation and accumulated impairments. Development expenses recognised as assets are amortised on a straightline basis over the estimated period in which products based on

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the intangible asset will be marketed. Demag Cranes subjects internally generated intangible assets to annual impairment testing during the development phase and at other times only when there are indications of impairment. Further information on development costs capitalised in the short financialyearisprovidedinNote15.

Tax
Tax assets and liabilities for the current and prior periods are measured at the amount expected to be recovered from or paid to the taxation authorities, using the tax rates that have been enacted by theendofthereportingperiod.Deferredtaxrelatingtoitemsrecogniseddirectlyinequityislikewise recogniseddirectlyinequity. Deferred tax is accounted for using the temporary difference approach. It is measured by applying the applicable tax rate to temporary differences between the carrying amounts of assets and liabilities in the statement of financial position and the tax bases used in the computation of taxable profit. The applicable tax rate is the rate prevailing at the balance sheet date or the rate that is virtually certain to apply for the relevant Group member company when the temporary differences reverse. Deferred tax assets are only recognised for temporary differences to the extent that it is probable that there will be sufficient taxable profits against which to utilise the benefits. Deferred tax assets are also recognised for tax loss carryforwards to the extent that it is probable that future taxable profit will be available against which the unused tax losses can be utilised. The carrying amount of deferred tax assets is reviewed at each balance sheet date and adjusted to reflect any change in the probability that the benefits can be utilised. The carrying amount of each deferred tax asset is reviewed at each balance sheet date and is reduced to the extent that it is no longer probable that sufficient taxable profit will be available against which a loss arising on reversal of the temporary differencecanbeutilised.Anyunrecogniseddeferredtaxassetsarereassessedateachbalancesheet date and recognised to the extent that it has become probable that future taxable profit will be availabletoallowthedeferredtaxassettoberecovered.Deferredtaxliabilitiesarerecognisedforall taxabletemporarydifferences. Deferred tax liabilities are not recognised for taxable temporary differences resulting from the initial recognitionofgoodwill.Similarly,deferredtaxliabilitiesarenotrecognisedfortemporarydifferences resulting from the initial recognition of other assets or liabilities in transactions other than business combinations where the initial recognition affects neither taxable profit nor net income. Demag Cranes does not recognise deferred tax liabilities for taxable temporary differences associated with investments in subsidiaries and associates or with interests in joint ventures if it is probable that the temporarydifferencewill notreverseintheforeseeablefuture,iftheCompanyisabletocontrolthe timing of the reversal, or if it is not probable that sufficient taxable profits will be available against whichalossarisingonreversalofthetemporarydifferencecanbeutilised. DemagCranesoffsetsdeferredtaxassetsanddeferredtaxliabilitiestotheextentthatithasalegally enforceable right to set off current tax assets against current tax liabilities relating to income taxes leviedbythesametaxationauthority.

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FurtherinformationondeferredtaxesisprovidedinNote31. Valueadded tax refundable by or payable to the taxation authority is accounted for by Demag Cranesaspartofothernonfinancialassetsandothernonfinancialliabilities,respectively.

Goodwillandnegativegoodwill
Goodwill recognised on a business combination is the excess of the consideration transferred to achieve control and the fair value of any previously held interests in the acquiree over the remeasured net assets of the acquiree. Goodwill is subsequently measured at cost less any accumulatedimpairmentlosses. For the purpose of impairment testing, which is done at least annually, Demag Cranes allocates goodwilltothecashgeneratingunitsthetwosegmentsthatareexpected toreapsynergiesfrom the business combination. On disposal of part of a cashgenerating unit to which goodwill has been allocated, the attributable amount of goodwill is included in the determination of the profit or loss on disposal. Goodwill recognised on acquisition of an equityaccounted investment is included in the carrying amount of the Groups investment and is not assessed for impairment separately. Further informationonimpairmenttestinginaccordancewithIAS36isprovidedinNote15. If the consideration transferred to achieve control and the fair value of any previously held interests in the acquiree falls short of the net assets of the acquiree measured at the acquisition date, Demag Cranes, after reassessing the amounts, recognises the excess immediately in profit or loss (gain from abargainpurchase).

Otherintangibleassets
Other intangible assets comprise patents, trademarks, software, service agreements, technology, customerrelations,supplierrelationsandcapitaliseddevelopmentprojects. Separately acquired intangible assets are recognised at cost less accumulated amortisation and accumulated impairment losses. Intangible assets acquired by Demag Cranes in a business combination are initially recognised at fair value at the acquisition date. Expenditure on internally generated intangible assets is capitalised if the criteria for recognition of an asset are satisfied. Subsequent expenditure on intangible assets is added to the carrying amount of the intangible asset if, and only if, it substantially increases the future economic benefits embodied in the asset and the costcanbereliablyestimated.Borrowingcoststhatareattributabletothepurchaseorproductionof a qualifying asset form part of the cost of that asset. All other expenditure in connection with intangibleassetsisrecognisedimmediatelyinprofitorloss. Intangible assets with finite useful lives are amortised on a straightline basis over the period of any contractual rights or the period over which they are expected to be used, whichever is the shorter. DemagCranesAGadditionallyreviewssuchassetsatleastannuallyforindicationsofimpairment.

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Theusefullivesofintangibleassetsarenormallyasfollows:

Usefullife Patents,licencesandsimilarrights Capitaliseddevelopmentprojects Trademarks Software Service agreements 5years 5years Indefinite 3years 6years

Intangible assets with indefinite useful lives are not amortised. Instead, Demag Cranes tests such assets at least annually for impairment. Trademarks are not amortised if they are established trademarksandthereisnodeterminablelimittotheirusefullives. Estimated useful lives are reviewed at each financial yearend and changed if necessary. Changes in accountingestimatesareappliedprospectivelyinprofitandlossinaccordancewithIAS8. Intangibleassetsarederecognisedondisposalorwhennofutureeconomicbenefitsareexpectedfor DemagCranes.Thegainorlossarisingfromthederecognitionofanintangibleassetisdeterminedas the difference between the net disposal proceeds, if any, and the carrying amount of the asset. It is recognisedinprofitorlossintheperiodofdisposal. ChangesinotherintangibleassetsarepresentedinNote15.

Property,plantandequipment
Property, plant and equipment consists of land, land rights and buildings, including buildings on thirdparty land, plant and machinery, prepayments and assets under construction, tools and equipment,andotherassets. Property, plant and equipment are carried at cost less any accumulated depreciation and any accumulated impairment losses. Demolition, removal, restoration and recultivation expenses are recognisedaspartofthecostofproperty,plantandequipmentandanequalamountisrecognisedin other provisions. Borrowing costs that are attributable to the purchase or production of a qualifying asset form part of the cost of that asset. All other expenses, such as for maintenance or modernisation,arerecognisedimmediatelyinprofitorloss. Parts of an item of property, plant and equipment with a cost that is significant in relation to the total cost of the item and a useful life significantly different to that of other parts are depreciated separately. Subsequent costs that increase future economic benefit and can be reliably estimated likewise form partofthecostofproperty,plantandequipment. Expenditure for major maintenance and repairs is added to the carrying amount of an item of property,plantandequipmentiffixedservicingoroverhaulintervalscanbereliablydetermined.

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Depreciation is charged on a straightline basis over the useful life of an item of property, plant and equipment.Therevaluationmethodisnotused.DemagCranesnormallyestimatestheusefullivesas follows:

Usefullife Factoryandoffice buildings Otherbuildings Plantandmachinery Toolsandequipment Vehicles ITequipmentandhardware 25to33years 8to50years 5to12years 3to10years 5to8years 3to5years

Estimated useful lives and depreciation methods are reviewed at each financial yearend and changedasnecessary.Changesinaccountingestimatesareappliedinprofitandloss. Items of property, plant and equipment are derecognised on disposal (e.g. sale, scrapping or demolition) or when no future economic benefits are expected for Demag Cranes. The gain or loss arising from the derecognition of an item of property, plant and equipment is determined as the difference between the net disposal proceeds, if any, and the carrying amount of the asset. It is recognisedinprofitorlossintheperiodofdisposal.

Investmentproperty
The investment property item consists of one site and one building on it held to earn rental income andforcapitalappreciation. Investment property is measured at cost less any accumulated depreciation and any accumulated impairmentlosses(costmodel).Depreciationischargedasforproperty,plantandequipment.Rental income is recognised as other operating income in the statement of comprehensive income and depreciationasotherexpenses. Investment property is derecognised on disposal or when the investment property is permanently withdrawnfromuseandnofutureeconomicbenefitsareexpectedfromitsdisposal.

Impairmentofnoncurrentnonfinancialassets
Demag Cranes assesses at least at each balance sheet date whether there is any indication that goodwill, other intangible assets, property, plant and equipment and investment properties are impaired.Ifanysuchindicationexists,theassetistestedforimpairment. Goodwill, other intangible assets with indefinite useful lives and intangible assets not yet available for use at the balance sheet date are also tested for impairment at each balance sheet date irrespective of whether there is any indication that they are impaired. If the recoverable amount of an asset or the cashgenerating unit to which it belongs is less than its carrying amount, the difference is recognised in profit or loss as an impairment loss. A cashgenerating unit is a group of assetsthatgeneratescashinflowsthatarelargelyindependent ofthecashinflowsfromotherassets or groups of assets. An impairment loss recognised for a cashgenerating unit is first allocated to

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reduce the carrying amount of any goodwill allocated to the unit and then to the other noncurrent assets of the unit pro rata on the basis of the carrying amount of each asset in the unit. If there is an indication that an impairment may no longer exist, Demag Cranes remeasures the recoverable amount.Ifthisexceedsthecarryingamountoftheassetorcashgeneratingunit,theimpairmentloss is reversed up to a maximum of cost less any accumulated depreciation or amortisation. Impairment lossesrecognisedforgoodwillarenotreversed. Other noncurrent assets are tested for impairment if there is any indication that the assets are impaired or that an impairment loss recognised in prior periods may no longer exist. An impairment loss recognised in prior periods is reversed if, and only if, there has been a change in the estimates used to determine the assets recoverable amount since the last impairment loss was recognised. The increased carrying amount attributable to a reversal of an impairment loss is limited to the recoverable amount or the carrying amount that would have been determined, net of amortisation or depreciation, had no impairment loss been recognised in prior years. A reversal of an impairment lossisrecognisedinprofitorloss.

Leasing
Leases that transfer to Demag Cranes (as lessee) substantially all the risks and rewards incidental to ownership of an asset are classified as finance leases. At the commencement of the lease term, financeleasesarerecognisedasassetsatamountsequaltothefairvalueoftheleasedpropertyor,if lower, the present value of the minimum lease payments. The future lease payments are recognised inthestatementoffinancialpositionunderloansandborrowings. Lease payments are apportioned in accordance with the effective interest method between the financechargeandthereductionoftheoutstandingliabilitysoastoproduceaconstantperiodicrate of interest on the remaining balance. The interest charge is recognised in interest and similar expenses. Lease payments under leases where the lessor retains substantially all the risks and rewards incidental to ownership (operating leases) are recognised as an expense on a straightline basis over the lease term unless another allocation to periods is more representative of the time pattern of Demag Cranes benefit from the use of the leased asset. Contingent payments under an operating leasearerecognisedasanexpenseintheperiodinwhichtheyareincurred.Thebenefitofincentives to enter into an operating lease is recognised as a reduction of rental expense over the lease term, on a straightline basis unless another systematic basis is more representative of the time pattern of DemagCranesbenefitfromtheuseoftheleasedasset.

Inventories
Inventoriesaremeasured atthelower ofcostandnetrealisable value.Costofpurchaseis measured using the rolling average method and cost of conversion using the standard cost method. Cost of conversionincludesdirectproductioncosts,includingdirectmaterialanddirectlabour,andallocated production overheads including depreciation on factory buildings and equipment. Borrowing costs thataredirectlyattributabletoaqualifyingassetformpartofthecostofthatasset.Inventorywrite downsincludeappropriatedeductionsforunusuallylongholdingperiodsandobsolescence.

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Constructioncontracts
Construction contracts that meet the applicable criteria are accounted for using the percentageof completion method. Demag Cranes normally determines the percentage of completion for this purposeaccordingtocontractcostsincurredtodateasapercentageofexpectedcontractcost(cost tocost method). Where the outcome of a construction contract cannot be measured reliably, revenue is recognised only in the amount of contract costs incurred that it is probable will be recoverable (zeroprofit method). The gross amount due from or to customers for contract work is presented under trade receivables or trade payables as appropriate. The gross amount due is equal to cost incurred plus recognised profits, less any recognised losses and progress billings up to a maximum of work performed. Amounts paid by customers in excess of amounts due are reported in liabilities as advance payments received. Any anticipated contract losses are recognised immediately infullinprofitorloss.FurtherinformationisprovidedinNote20.

Financialinstruments
A financial instrument is any contract that gives rise to a financial asset of one entity and a financial liability or equity instrument of another entity. Demag Cranes initially recognises a financial instrument when a company in the Demag Cranes Group becomes a party to the contractual provisions governing the instrument. Financial instruments are recognised and derecognised on the settlementdate. As in the previous year, there were no reclassifications of financial instruments during the short financialyear. Primaryfinancialinstruments Financial assets and financial liabilities are initially recognised at fair value plus directly attributable transaction costs, except financial instruments at fair value through profit or loss, which are recognised at fair value without transaction costs. The fair value of financial instruments traded on organised markets is determined using the quoted price on the balance sheet date. If Demag Cranes has financial instruments for which there is not an active market, their fair value is determined by using a valuation technique. Subsequent measurement is carried out in accordance with the classification of financial instruments into the categories that follow. Financial assets with the exception of those classified as at fair value through profit or loss are tested at each balance sheet dateforimpairment. Heldtomaturity

This category consists of financial assets quoted in an active market with fixed or determinable payments and fixed maturity that Demag Cranes has the intention and ability to hold to maturity. Financialassetsheldtomaturityaremeasuredatamortisedcostusingtheeffectiveinterestmethod, less any impairment losses. Demag Cranes does not have any financial instruments held to maturity atthebalancesheetdate.

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Loansandreceivables

Loans and receivables are nonderivative financial assets with fixed or determinable payments that are not quoted in an active market. This category mainly consists of trade receivables and cash and cash equivalents. These are measured at amortised cost using the effective interest method less accumulated impairment losses. Receivables that carry no interest or that bear an offmarket interestratearemeasuredatthepresentvalueoffuturecashreceipts. Atfairvaluethroughprofitorloss

This category contains two subcategories: held for trading, and designated as at fair value through profit or loss. These assets are measured at all times at fair value. Changes in their fair value are recognised in profit or loss. The held for trading subcategory contains the fair value of currency and interest rate derivatives (further information is provided in Notes 20, 29 and 34). Demag Cranes has nofinancialinstrumentsinthedesignatedasatfairvaluethroughprofitorlosscategory. Availableforsalefinancialassets

This category encompasses all financial assets which, based on objective criteria, are not classified in any other category or which Demag Cranes has designated as available for sale. Availableforsale financialassetsatDemagCranesmainlycompriselongtermsecuritiesandinvestmentsinassociates. Longterm securities are measured at fair value. Gains and losses arising from changes in their fair value are recognised directly in equity under availableforsale financial assets, except for impairment losses and exchange differences arising on translation of monetary items denominated in foreign currencies, which are recognised directly as income or expense in profit or loss. When the assetsarederecognised,theaccumulatedgainorlosspreviouslyrecognisedinequityisrecognisedin profitorloss.Associatesaremeasuredatcostlessanyaccumulatedimpairmentlossesastheyareof minoroverallsignificance.FurtherinformationonthiscategoryisprovidedinNotes19and34. Financialliabilitiesmeasuredatamortisedcost

Financial liabilities in this category are measured at amortised cost using the effective interest method, recognising the interest expense in profit or loss in accordance with the effective interest rate for the period. At Demag Cranes, the category comprises loans and borrowings (Notes 28 and 34),tradepayablesandaportionofotherfinancialliabilities(Notes29and34). Derivativefinancialinstruments Hedging is used to manage interest and exchange rate risk. The hedging instruments used by Demag Cranesmainlyconsistofforeignexchangecontractsandinterestrateswaps. All derivative financial instruments are accounted for as financial assets or financial liabilities and measured at fair value at the balance sheet date. Changes in the fair value of derivative financial instruments are recognised as income or expense in profit or loss. Derivative financial instruments are accounted for by the rules applicable to the at fair value through profit or loss category. Hedge accountingwasnotappliedintheshortfinancialyear.

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Impairmentoffinancialassets Financial assets classified as loans and receivables or available for sale are tested for impairment at eachbalancesheetdate.AfinancialassetisimpairedifthereareindicationsthatDemagCranesmay not recover part of its initial investment and the present value of the future cash flows or the fair value of the financial asset is less than the instruments carrying amount. On an availableforsale equity instrument, a significant or prolonged decline in the fair value of the financial instrument below its cost is to be considered objective evidence of impairment. Financial assets are tested for impairment individually or on a portfolio basis. Demag Cranes recognises allowances as appropriate for all identifiable credit risks. The remaining credit risk from financial instruments corresponds to their carrying amounts. The impairment loss on a financial instrument measured at amortised cost is the difference between the assets carrying amount and the present value of estimated future cash flows from the asset discounted at the instruments original effective interest rate. An impairment loss directly reduces the carrying amount of all affected financial instruments except for trade receivables, where impairment losses are recognised through an allowance account. When a trade receivable is considered uncollectible, it is written off against the allowance account. Subsequent recoveriesofamountspreviouslywrittenoffareaccountedforbyreversingtheallowanceaccountto profitorloss. If in a subsequent period the fair value of an availableforsale financial asset other than an equity instrument increases and the increase can be objectively related to an event occurring after the impairment loss was recognised, the impairment loss is reversed through profit or loss and any increase in excess of amortised cost is recognised directly in equity. Impairment losses recognised in profit or loss for an investment in an equity instrument classified as available for sale are not reversed. Any increase in fair value after recognition of an impairment loss is recognised directly in equity. Derecognitionoffinancialinstruments A financial asset is derecognised when the contractual rights to the cash flows from the asset expire or it is transferred to another party with all the risks and rewards of ownership. If on formal transfer of a financial asset Demag Cranes neither transfers nor retains substantially all the risks and rewards ofownershipandretainscontrolofthetransferredasset,itcontinuestorecognisethefinancialasset totheextentofitscontinuinginvolvementandrecognisesasaliabilityanyobligationscreatedinthe transfer.IfDemagCranesretainssubstantiallyalltherisksandrewardsofownershipofatransferred financial asset, it continues to recognise the asset and recognises a secured loan for the considerationreceived. Demag Cranes derecognises a financial liability when, and only when, the underlying obligation is dischargedorcancelledorexpires.

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Financialinstruments:Otherinvestments
The other investments item consists of two subitems associates and longterm securities and comes under the availableforsale financial assets category. Longterm securities are measured at fair value. This is determined by prices quoted in an active market. Gains and losses arising from changes in fair value are recognised directly in equity, taking account of any deferred tax. On disposal, the accumulated gain or loss previously recognised directly in equity is recognised in profit or loss. The appropriate classification of securities is determined on purchase and reviewed at each balancesheetdate.Therewerenoreclassificationsintheshortfinancialyear. Investments in associates are measured at cost less accumulated impairment losses, as they are of minoroverallsignificance.Therewerenoindicationsofimpairmentintheshortfinancialyear. FurtherinformationontheotherinvestmentsitemisprovidedinNote19.

Financialinstruments:Tradereceivables
Trade receivables are classified in the loans and receivables category. They are initially recognised at fair value plus directly attributable transaction costs and subsequently measured at amortised cost usingtheeffectiveinterestmethod,lessaccumulatedimpairmentlosses.

Financialinstruments:Otherfinancialassets
Otherfinancialassetsotherthanderivativefinancialinstrumentsaremeasuredatamortisedcostless accumulatedimpairmentlosses.Theseassetsareclassifiedintheloansandreceivablescategory.The measurement of derivative financial instruments is explained in a separate section (Derivative financialinstruments).

Financialinstruments:Cashandcashequivalents
Cashandcashequivalentsincludecash onhandand inbanks,bankdepositsonuptoonedaynotice and securities with a residual maturity of up to three months at the acquisition date. These holdings are classified in the loans and receivables category. Demag Cranes measures cash and cash equivalentsatamortisedcost.

Noncurrentassetsheldforsaleandassociatedliabilities
To be classed as assets held for sale, assets must be available for immediate sale and their sale must be highly probable. Assets held for sale can be individual noncurrent assets or groups of assets held for sale (disposal groups). Liabilities that are disposed of with assets held for sale in a single transaction are part of a disposal group and are reported separately under current liabilities as liabilitiesassociatedwithassetsheldforsale. Noncurrent assets held for sale and disposal groups cease to be depreciated or amortised, and are measuredattheircarryingamountoratfairvaluelesscoststosell,whicheverislower.

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Pensionobligations
Pension obligations arise under defined contribution and defined benefit plans. Contributions to defined contribution plans are recognised as an expense in profit or loss in the year employees have renderedserviceentitlingthemtothecontributions. Thepresent valueofthe obligationunderdefinedbenefit plansismeasuredseparatelyfor eachplan using the projected unit credit method, based on the estimated amount of benefit employees have earned up to the balance sheet date. Demag Cranes obtains an actuarial valuation to measure the amount of its obligation each year. Demag Cranes net obligation is determined by subtracting the fair value of plan assets from the present value of the defined benefit obligation. The discount rate used is the yield at the balance sheet date on senior corporate bonds with maturities approximating to the duration of the benefit. Experience adjustments and changes in actuarial parameters over time canresultindifferencesbetweentheactualandexpected benefitobligationandtheactualand expected return on plan assets. The resulting actuarial gains and losses are recognised directly in equity (in retained earnings) and presented separately in the statement of comprehensive income. If plan benefits are subsequently increased, the share of the present value of the increased benefits that relates to employees past service (the past service cost) is recognised as expense on a straight line basis over the vesting period. The past service cost for benefits that are vested immediately is recognisedimmediatelyinprofitorloss.

Otherprovisions
Other provisions are recognised if at the balance sheet date Demag Cranes has a present obligation (legal or constructive) as a result of a past event, it is probable that an outflow of resources embodying economic benefits will be required to settle the obligation and a reliable estimate can be made of the amount of the obligation. Where the time value of money is material, provisions are recognised at the discounted present value of the expected amount of the obligation. The discount rate used is a pretax rate that reflects current market assessments of the time value of money and the cash flow risk on the liability. If it is virtually certain that the amount of a provision will be reimbursed by an identifiable third party, the expected reimbursement is recognised as a separate asset.Provisionsfortheestimatedcostofproductwarrantiesarerecognisedwhenproductsaresold. Restructuring provisions are recognised when a detailed formal restructuring plan has been drawn up and announced to the parties affected. Changes in estimates used in the measurement of provisions are recognised in profit or loss. No provision is recognised for costs that need to be incurredtooperateinthefuture.Provisionsforonerouscontractsarerecognisedifandtotheextent it becomes apparent that the unavoidable costs of meeting the obligations under the contract exceedtheeconomicbenefitsexpectedtobereceivedunderit.

Financialinstruments:Loansandborrowings
Interestbearing loans and borrowings are initially recognised at fair value less transaction costs incurred on inception. Subsequent to initial recognition, interestbearing loans and borrowings are measured at amortised cost, with the difference between the initial amount and the repayment amountbeingrecognisedasinterestexpenseovertheloantermusingtheeffectiveinterestmethod.

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Gains and losses arising from amortisation of such differences and derecognition of financial liabilitiesarerecognisedimmediatelyinprofitorloss. Financial guarantee contracts are initially measured at fair value plus any transaction costs directly attributable to their issue. They are subsequently measured at the higher of the amount of any provision recognised for giving the guarantee and the amount initially recognised less accumulated amortisation.

Financialinstruments:Tradepayables
Trade payables are financial liabilities that Demag Cranes measures at amortised cost using the effectiveinterestmethod.

Contingentliabilities
Acontingentliabilityisapossibleobligationthatarisesfrompasteventsandwhoseexistencewillbe confirmed only by the occurrence or nonoccurrence of one or more uncertain future events, or a present obligation where it is possible but not probable that an outflow of resources embodying economicbenefitswillberequiredtosettletheobligationortheamountoftheobligationcannotbe measuredwithsufficientreliability.

5. Accountingestimatesandjudgements
The preparation of financial statements in conformity with IFRS requires the use of estimates and assumptions that affect the amount of assets and liabilities and disclosures on contingent assets and liabilities at the balance sheet date and the amount of income and expenses during the reporting period. Actual amounts may differ from these estimates. The estimates and assumptions are based onexperienceandotherfactorsconsideredrelevantinmeasuringcarryingamountswheretheseare not readily apparent from other reliable sources. Demag Cranes reviews the estimates and underlyingassumptionsonanongoingbasis.Revisionstoaccountingestimatesarerecognisedinthe period in which an estimate is revised if the revision affects only that period, or in the period of the revisionandfutureperiodsiftherevisionaffectsbothcurrentandfutureperiods. In the preparation of the Consolidated Financial Statements, the Management Board of Demag CranesAGusedestimatesandassumptionsrelatingtomaterialitemsasfollows: Assessment of the need to recognise impairments and measurement of the amount of any impairmentloss

DemagCranesassessesateachreportingdatewhetherthereisanyindicationthatitemsofproperty, plant and equipment, intangible assets or investment property are impaired. To test for impairment, an assets or cashgenerating units recoverable amount is compared with its carrying amount. The recoverable amount is fair value less costs to sell or value in use, whichever is higher. Demag Cranes normally measures the recoverable amount on the basis of fair value less costs to sell. In estimating fair value less costs to sell, management makes assumptions regarding expected future cash flows from each asset or cashgenerating unit, using appropriate discount rates. The recoverable amount

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of trademarks in other intangible assets is determined using the relief from royalty method. Impairmenttestinghasconfirmedthecarryingamountsofgoodwillandtrademarks. Estimatedusefullives

Useful lives are based on estimates. The estimated useful lives of intangible assets, property, plant and equipment and investment property are reviewed at each financial yearend. As in the previous year,thereviewhasnotidentifiedanyneedtoaltertheestimatedusefullifeofanyasset. Recognitionandmeasurementofdevelopmentexpenses

Development expenses are capitalised if the recognition criteria are satisfied. Management makes assumptions in this connection concerning the size of expected future cash flows, the applicable discount rates and the period over which expected future benefits will be generated. Development expensesareamortisedovertheexpectedusefullifeoftheassetfromthepointatwhichitisableto be used. EUR 608,000 in development expenses were capitalised in the short financial year (2011/2012: EUR 2,695,000). Impairment testing of capitalised development expenses did not result in recognition of any impairment losses in the short financial year 2012. Further information on the impairmentofcapitaliseddevelopmentexpensesisprovidedinNote15. Accountingforpensionsandsimilarobligations

Demag Cranes uses actuarial valuations in the measurement of pensions and similar obligations. These valuations are made on the basis, among other things, of expected returns on plan assets, futuresalaryincreases,futurepensionincreases,mortalityandstaffturnover.Duetotheirlongterm focus, these estimates are subject to material uncertainty. The provision for pensions and similar obligations amounted to EUR 200,630,000 at the balance sheet date (30 September 2012: EUR 183,691,000).FurtherinformationisprovidedinNote26. Accountingforrestructuringprovisions

The size of restructuring provisions is based on managements best estimate. Changes in estimates may become necessary as the restructuring plan takes on substance and is implemented. The restructuring provision came to EUR 5,637,000 at 31 December 2012 (30 September 2012: EUR 4,235,000).FurtherinformationisprovidedinNote27. Otherpersonnelrelatedobligationsandpartialretirementobligations

Recognition and measurement of partial retirement obligations and other personnelrelated obligations likewise involve estimates and assumptions regarding the expected timing and amount. Factors affecting the size of the provision include biometric data used in calculations, workforce turnover and takeup of partial retirement arrangements. Other personnelrelated obligations totalled EUR 25,153,000 at the balance sheet date (30 September 2012: EUR 37,237,000). Partial retirement obligations came to EUR 7,453,000 (30 September 2012: EUR 8,364,000). Further informationisprovidedinNote30.

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Deferredtaxassets

Deferred tax assets are recognised for tax loss carryforwards to the extent that it is probable that there will be taxable profits permitting their utilisation. Their measurement requires estimates as to the timing and amount of taxable profits against which they can be utilised. At 31 December 2012, the net carrying amount of deferred tax assets recognised for tax loss carryforwards amounted to EUR4,515,000(30September2012:EUR3,253,000).FurtherinformationisprovidedinNote31. All estimates and assumptions are based on the best available information and the objective of achievingafairpresentationofthefinancialposition,financialperformanceandcashflowsofDemag Cranes. Due to the uncertainty associated with estimates and assumptions, actual results may differ fromthereportedamounts.

6. ConsolidatedGroup
The Consolidated Financial Statements for the year ended 31 December 2012 incorporate the FinancialStatementsofDemagCranesAGand32(2011/2012:37)domesticandforeignsubsidiaries. On 14 December 2012, a number of foreign subsidiaries were sold to companies in the Terex Group. Thetransactionsinvolvedwereasfollows: Demag Cranes & Components S.p.A., Italy, as well as its subsidiaries Donati Sollevamenti S.r.l., Italy and Donati Ltd. UK, UK (the latter was held only as an investment in the Demag Cranes Group and wasnotincludedintheconsolidation)weresoldtoTerexItaliaS.r.l.,Italy. Demag Cranes & Components S.A.U., Spain was sold to Terex Equipment and Machinery Espana S.L.U.,Spain. DCC France Holdco S.A., France and its subsidiary Demag Cranes & Components S.A.S., France were soldtoTerexCranesSAS,France. DemagCranes&ComponentsPty.Ltd.,AustraliawassoldtoTerexAustraliaPty.Ltd.,Australia. The selling price was EUR 83,748,000. The EUR 62,357,000 deconsolidation gain is included in other operating income in the statement of comprehensive income. The sale of the companies affected financialstatementitemsasfollows:

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inEURthousand Goodwill Property,plantandequipment Othernon currentassets Inventories Trade receivables Othercurrentassets Assets Non currentliabilities Currentliabilities Liabilities Netassets Differencesarisingfromcurrencytranslation Salesprice Proceedsfromdisposalofassets 7,674 1,870 7,285 13,291 36,431 13,531 80,083 3,151 57,333 60,484 19,599 2,550 83,748 66,698

The assets and liabilities of the companies sold were reported in the Consolidated Financial Statements at 30 September 2012 as noncurrent assets held for sale and liabilities associated with noncurrentassetsheldforsale. The Demag Cranes Consolidated Financial Statements at 30 September 2012 show the deconsolidation of the two US companies Demag Cranes & Components US, Cleveland, USA and Crane America Services, Dayton, USA. The sale of these two companies resulted in a profit of EUR 57,205,000whichisincludedinthestatementofcomprehensiveincomeforthefinancialyearfrom1 October2011to30September2012.

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Notestothestatementofcomprehensiveincome
7. Revenue
inEURthousand SegmentMaterial Handling SegmentPortSolutions Total ShortFY2012 167,339 59,801 227,140 2011/2012 858,463 264,804 1,123,267

Revenue from the sale of goods to the value EUR105,886,000 (2011/2012: EUR523,979,000) and revenue from the sale of services to the value of EUR61,452,000 (2011/2012: 334,484,000) was achievedintheMaterial Handlingsegment.Revenuein thePortSolutionssegmentrefers exclusively tothesaleofgoods. Revenuefrom the sale of goods denominated in foreign currencies is cash flow hedged using foreign currencyderivativesandincludesnetgainsorlossesonthosederivatives. Further information on revenue by segment and by region is contained in the segment reporting section(Note33).

8. Selling,generalandadministrativeexpenses
inEURthousand Sellingexpenses General administrative expenses Total ShortFY2012 40,137 18,884 59,021 2011/2012 158,646 72,856 231,502

Selling expenses include agents commissions, marketing and advertising expenses, and outbound freight for deliveries to end customers. General and administrative expenses consist of expenses not attributabletodevelopmentandproductionortosales.

9. Researchanddevelopmentexpenses
inEURthousand Incurredresearchanddevelopmentexpenses Amortisation Impairments Capitaliseddevelopmentexpenses Total ShortFY2012 4,998 477 612 4,863 2011/2012 19,110 1,710 2,495 18,325

The incurred research and development expenses subitem contains all expenses for research and developmentactivities.Theamortisationrelatestocapitaliseddevelopmentexpenses. Detailedinformationoncapitaliseddevelopmentexpenses,amortisationandimpairmentsisgivenin Note15(Goodwillandotherintangibleassets).

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10. Otheroperatingincomeandotheroperatingexpenses
inEURthousand Foreignexchange gains Gainsondisposal ofAU,FR,ITandESentities/previousyearUSentities Gainsondisposal ofassets Income fromreversal ofotherprovisions Other Otheroperatingincome Foreignexchange losses Lossesondisposal ofassets Other Otheroperatingexpenses ShortFY2012 1,438 66,698 25 20 6,150 74,331 2,898 19 696 3,614 2011/2012 9,927 57,205 198 114 3,763 71,207 11,066 147 736 11,949

11. Incomefrominvestmentsaccountedforusingtheequitymethod
The EUR 1,030,000 (2011/2012: EUR 3,919,000) income from investments accounted for using the equity method in the statement of comprehensive income is from the 50% share of MHEDemag (S) Pte.Ltd.,Singapore,heldbyDemagCranes&ComponentsGmbH,Wetter,Germany.

12. Interestandsimilarincomeandinterestandsimilarexpenses
inEURthousand Interestoncurrentaccountsandtermdeposits Measurementof interestrate swapsatfairvalue Expectedreturnonplanassets Other interestandsimilarincome Interestonseniorcreditfacility Interestexpensesonpensionprovisions Interestexpensesonnoncurrentliabilities Amortisationofdebtissuance costs Other interestandsimilarexpenses ShortFY2012 324 190 268 782 1,562 75 1,312 2,949 2011/2012 1,725 764 670 3,158 4,121 7,147 536 1,962 2,682 16,449

13. Incometax
The30.55%(2011/2012:30.55%)incometaxratefordomesticcompaniesconsistsofcorporationtax at 15.0% (2011/2012: 15.0%) plus the supplementary 5.5% solidarity surcharge (2011/2012: 5.5%) andGermantradetaxatanaverageof14.72%(2011/2012:14.72%). Currentanddeferredincometaxatforeigncompaniesiscomputedonthebasisoflocaltaxrates.

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Incometaxismadeupasfollows:
inEURthousand Currentincome tax Germany Othercountries Subtotal Deferredtax Germany Othercountries Subtotal Total ShortFY2012 595 1,741 2,336 2,470 2,470 134 2011/2012 13,293 16,624 29,918 1,498 769 2,267 32,185

The reported income tax figure differs from expected income tax expenses based on the 30.55% aggregateGermanincometaxrateforthereasonssetoutinthefollowing:
inEURthousand Earningsbefore tax(EBT) Grouptax rate(%) Expectedincometaxexpenses Differencesdue toforeigntaxrates Effectsoflossescarriedforward/valuationallowances Taxfree income Nondeductible expenses Effectsofchangesinincome tax rates Income tax ofprioryears Permanentdifferences Effectsfromthe profittransferagreements Other Reportedincome tax Effectivetax rate(%) ShortFY2012 57,703 30.55 17,628 367 601 17,721 724 1,183 133 942 1,527 134 0.2 2011/2012 116,966 30.55 35,733 810 8,265 16,963 1,408 1,209 9,579 1,860 2,095 1,484 32,185 27.5

As a result of applying the legal form approach to the tax group, the Consolidated Financial Statements only include tax effects legally attributable to Demag Cranes AG and its subsidiaries as taxsubjectinrelationtothetaxauthorities.

14. Earningspershare
ShortFY2012 57,396 21,172,993 2.71 2010/2011 84,506 21,172,993 4.00

Netincome attributable toshareholdersofDemagCranesAG(inEURthousand) Weightedaverage numberofsharesoutstanding Earningspershare (inEUR)

Thereisnodilutiveeffectasnopotentialshareswereincirculationintheshortfinancialyear2012or in the comparative period, financial year 2011/2012. Diluted earnings per share and basic earnings persharearethereforethesame.

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Notestothestatementoffinancialposition

15. Goodwillandotherintangibleassets
Otherintangible assets Capitalised Capitalised development(in development progress) (completed) Software Other intangible assets

Goodwill inEURthousand Costofsales Balanceat1October2011 Change inthe scope ofthe ConsolidatedFinancial Statements Additionsfromacquisitions Additionsfrominternal development Disposals Reclassifications Reclassificationasassetsunderconstruction Reclassificationasassetsheldforsale Exchange difference Balanceat30September2012 Balanceat1October2012 Change inthe scope ofthe ConsolidatedFinancial Statements Additionsfromacquisitions Additionsfrominternal development Disposals Reclassifications Reclassificationasassetsunderconstruction Reclassificationasassetsheldforsale Exchange difference Balanceat31December2012

Trademarks

Patents

Total

120,427 17,663 7,674 3 95,093 95,093 22 95,071

27,846 85 27,761 27,761 27,761

15,139 15,139 15,139 15,139

5,299 1,998 4,180 3,117 3,117 608 3,725

20,208 696 4,180 25,085 25,085 25,085

29,481 2,083 149 124 61 424 122 31,298 31,298 382 470 120 31,090

2,731 981 16 9 124 417 91 1,306 1,306 3 15 1,295

221,129 18,643 2,098 2,695 159 61 8,600 216 198,798 198,798 385 608 470 157 199,164

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Otherintangible assets Capitalised Capitalised development(in development progress) (completed) Software Other intangible assets

Goodwill inEURthousand Depreciation,amortisationandimpairments Balanceat1October2011 Change inthe scope ofthe ConsolidatedFinancial Statements Amortisation Impairments Disposals Reclassifications Reclassificationasassetsheldforsale Exchange difference Balanceat30September2012 Balanceat1October2012 Change inthe scope ofthe ConsolidatedFinancial Statements Amortisation Impairments Disposals Reclassifications Reclassificationasassetsheldforsale Exchange difference Balanceat31December2012 Carryingamount Balance at1October2011 Balanceat30September2012 Balance at1October2012 Balanceat31December2012 120,427 95,093 95,093 95,071

Trademarks

Patents

Total

85 85 0 0 0

15,068 12 15,080 15,080 3 15,083

0 0 0

17,528 1,252 18,780 18,780 355 19,135

22,788 3,026 147 64 241 54 25,544 25,544 718 470 86 25,705

2,239 981 181 9 64 416 57 1,007 1,007 44 8 1,042

57,708 981 4,471 156 742 111 60,410 60,410 1,120 470 96 60,963

27,761 27,761 27,761 27,761

71 59 59 56

5,299 3,117 3,117 3,725

2,680 6,305 6,305 5,951

6,692 5,754 5,754 5,385

492 300 300 253

163,422 138,387 138,387 138,201

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Goodwill
Demag Cranes tests goodwill for impairment annually at segment level. Goodwill is allocated to segmentsasfollows:
inEURthousand SegmentMaterial Handling SegmentPortSolutions Total 31December 2012 87,034 8,037 95,071 30September 2012 87,056 8,037 95,093

As there is no active market in which to determine the fair value of the segments, Demag Cranes assessesgoodwillallocatedtothemforimpairmentbyreferencetotheirdiscountedexpectedfuture operating cash flows less estimated costs to sell (fair value less costs to sell). These cash flows are estimated over the detailed planning period on the basis of the plan for the Group, which has a one year planning horizon. Key factors incorporated into the planning model include trends in exchange rates, relevant markets, and costs of production, selling and marketing, and administration. These take into account general market forecasts alongside current trends and past experience. A growth rate of 2.1% to 3.2% (2011/2012: 2.0% to 4.1%) is assumed for the first two periods following the planning horizon. Net cash flows are estimated beyond the planning horizon as the average net cash flows from preceding periods. The weighted average cost of capital used to discount future cash flowsis,onaposttaxbasis,10.2%intheMaterialHandlingsegment(2011/2012:9.3%)and10.2%in the Port Solutions segment (2011/2012: 9.3%). Demag Cranes estimates costs to sell at 2% (2011/2012:2%)oftheestimatedfairvalueoftherelevantcashgeneratingunit. As in financial year 2011/2012, the impairment tests performed in the short financial year 2012 confirmedtheexistingcarryingamountsofgoodwill.

Otherintangibleassets
TheEUR43,130,000otherintangibleassetsiteminthestatementoffinancialposition(30September 2012: EUR 43,294,000) comprises trademarks, patents, capitalised development costs for developmentinprogressandcompleteddevelopment,software,andsundryotherintangibleassets. Development expenses totalling EUR 608,000 were capitalised in the short financial year 2012 (2011/2012: EUR 2,695,000). This was accounted for by the Port Solutions and Material Handling segments. No borrowing costs were recognised for qualifying assets in the period under review (2011/2012: borrowing costs of EUR 200,000). The underlying capitalisation rate determined on a quarterlybasisaveraged3.74%infinancialyear2011/2012. As in financial year 2011/2012, impairment testing in the short financial year 2012 did not result in recognitionofanyimpairmentlosses. Asinfinancialyear2011/2012,therewerenoimpairmentreversalsintheshortfinancialyear2012. Demag Cranes assumes for trademark assets that the assets are subject to continued use and have indefiniteusefullives.Trademarkswithindefiniteusefullivesaretestedannuallyforimpairment.The

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recoverable amount against which the carrying amount is compared is measured at fair value using the relief from royalty method. The future cash flows are discounted applying a oneyear planning horizonataposttaxdiscountrateof10.2%intheMaterialHandlingsegment(30September2012: 9.3%) and 10.2% in the Port Solutions segment (30 September 2012: 9.3%). The imputed licence fee is estimated by Demag Cranes at 0.5% (30 September 2012: 0.5%) of budgeted revenue using the trademark.Thecarryingamountsoftrademarkassetsineachsegmentareasfollows:

inEURthousand SegmentMaterial Handling SegmentPortSolutions Total

31December 2012 17,514 9,747 27,261

30September 2012 17,514 9,747 27,261

The Demag brand, which is not allocated to a specific segment, is additionally recognised with a carryingamountofEUR500,000(30September2012:EUR500,000). As in the previous year, impairment testing of trademarks did not give cause to recognise any impairmentlosses. Amortisationandimpairmentsofotherintangibleassetsaredividedbetweenitemsinthestatement ofcomprehensiveincomeasfollows:
Ofwhich impairments inEURthousand Costofsales Researchanddevelopmentexpenses Selling,general andadministrative expenses Total ShortFY2012 135 415 570 1,120 2011/2012 568 1,464 2,439 4,471 Ofwhich impairments

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16. Property,plantandequipment
Advance paymentsand Advance payments assetsunder andassetsunder construction construction

Land inEURthousand Costofsales Balanceat1October2011 Change inthe scope ofthe ConsolidatedFinancial Statements Additions Disposals Reclassifications Reclassificationasassetsheldforsale Otherchanges Exchange difference Balanceat30September2012 Balanceat1October2012 Additions Disposals Reclassifications Exchange difference Balanceat31December2012

Buildingsand leasehold improvements

Other Plantand plantand machinery machinery

Total

24,715 550 190 19 23,994 23,994 2 23,992

71,132 2,274 3,114 56 1,277 446 325 72,423 72,423 158 64 135 72,510

114,172 1,866 5,009 2,137 3,072 3,036 270 115,485 115,485 1,559 675 1,551 584 117,336

44,785 2,796 4,666 1,919 965 6,435 234 39,501 39,501 946 1,123 500 252 39,571

6,216 128 4,542 29 5,376 320 2 4,904 4,904 4,435 6 2,115 35 7,182

10 148 1 158 158 0 158

261,031 7,613 17,478 4,140 61 10,427 197 256,465 256,465 7,097 1,804 0 1,008 260,750

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Advance paymentsand Advance payments assetsunder andassetsunder construction construction

Land inEURthousand Depreciation,amortisationandimpairments Balanceat1October2011 Change inthe scope ofthe ConsolidatedFinancial Statements Amortisation Impairments Disposals Reclassificationasassetsheldforsale Exchange difference Balanceat30September2012 Balanceat1October2011 Amortisation Impairments Disposals Reclassification Exchange difference Balanceat31December2012 Carryingamount Balance at1October2011 Balanceat30September2012 Balance at1October2012 Balanceat31December2012 23,684 22,962 22,962 22,960

Buildingsand leasehold improvements

Other Plantand plantand machinery machinery

Total

1,032 1,032 1,032 1,032

36,528 1,418 3,576 15 260 93 38,319 38,319 885 6 66 39,131

71,705 1,258 9,080 1,971 2,155 222 75,623 75,623 2,147 49 594 36 254 76,934

32,443 1,920 4,423 1,844 5,614 202 27,690 27,690 1,038 1,082 36 140 27,542

365 275 7 98 98 2 96

10

142,083 4,596 17,095 3,831 8,304 340 142,787 142,787 4,079 49 1,682 0 463 144,770

15 1 26 26 9 35

34,604 34,104 34,104 33,379

42,467 39,862 39,862 40,402

12,343 11,812 11,812 12,029

5,851 4,806 4,806 7,087

133 133 123

118,949 113,678 113,678 115,980

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Animpairmentwasrecognisedona machinein the amountof EUR49,000in theshortfinancialyear 2012 (2011/2012: EUR 0,000). There were no impairment reversals on property, plant and equipmentintheshortfinancialyear2012orinthefinancialyear2011/2012. Amortisation and impairments of property, plant and equipment are divided between items in the statementofcomprehensiveincomeasfollows:
Ofwhich impairments inEURthousand Costofsales Researchanddevelopmentexpenses Selling,general andadministrative expenses Total ShortFY2012 3,349 62 717 4,128 49 49 2011/2012 13,976 246 2,874 17,095 Ofwhich impairments

Prepaymentsandassetsunderconstruction
Theprepaymentsandassetsunderconstructionsubitemismadeupasfollows:
inEURthousand Turningmachine TauchImpregnatingsystem Vertical turningsystem LightConstructionhall Hall Refurbishment Machiningcentre ElectricHall CNCmachinery Vehiclesforheavyload Toolingequipment Paintingbooth Tensiontestingmachine Supplyline fordistributioncentre Testfacility Refurbishmentof staff canteen Bedmillingmachine Boiler Brake winder Cranes Other Total 31December 2012 843 608 518 448 411 400 241 231 201 198 158 152 150 106 106 2,318 7,087 30September 2012 758 518 127 465 231 139 101 100 2,366 4,806

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17. Investmentproperty
Land inEURthousand Costofsales Balanceat1October2011 Transferto/fromproperty,plantandequipment Disposals Exchange difference Balanceat30September2012 Balanceat1October2012 Transferto/fromproperty,plantandequipment Disposals Exchange difference Balanceat31December2012 Depreciation,amortisationandimpairments Balanceat1October2011 Amortisation Impairments Disposals Exchange difference Balanceat30September2012 Balanceat1October2012 Amortisation Impairments Disposals Exchange difference Balanceat31December2012 Carryingamount Balance at1October2011 Balanceat30September2012 Balance at1October2012 Balanceat31December2012 178 178 178 177 1 1 1 1 179 179 179 178 Land Total

178 0 178 178 1 177

8 0 8 8 0 7

186 0 186 186 2 184

6 0 0 6 6 0 0 6

6 0 0 6 6 6

As in the previous year, rental income included under other operating income in the statement of comprehensive income for the reporting period comes to less than EUR 100,000 net of attributable operatingexpenses.

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18. Investmentsaccountedforusingtheequitymethod
EquityaccountedinvestmentsrelateintheirentiretytotheshareholdinginMHEDemag(S)Pte.Ltd., Singapore (MHE Demag). Demag Cranes share in the profit of MHEDemag for the short financial year 2012 is EUR 1,030,000 (2011/2012: EUR 3,919,000). Revenue in the short financial year 2012 includes EUR7,763,000 (2011/2012: EUR 26,500,000) in supplies to MHEDemag. Income from the investment included in the statement of comprehensive income is explained in Note 11 (Income frominvestmentsaccountedforusingtheequitymethod). The table below contains financial information on MHEDemag relative to the 50% ownership interestheldbyDemagCranes:
inEURthousand Revenue
1 1

31December 2012 16,992 51 16,440 318


1

30September 2012 67,184 447 62,482 1,230 3,919 7,631 48,515 766 31,716 23,664

Otheroperatingincome Expenses Tax


1 1

Operatingnetincome aftertax Noncurrentassets Currentassets Noncurrentliabilities Currentliabilities Equity

1,030 8,051 50,515 895 33,424 24,247

19. Otherinvestments
Investmentin associates inEURthousand Cost Balance at1October2011 Additions Change infairvalue Reclassificationasassetsheldforsale Disposals Balance at30September2012 Balance at1October2012 Additions Change infairvalue Disposals Balance at31December2012 Long term securities Total

50

694

745 29 15 25 733 733 4 730

29 15 25 10 723 10 723 4 10 720

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20. Tradereceivablesandotherfinancialassets
inEURthousand Trade receivables Trade receivablesassociates andjointventures Derivative financial instruments Receivablesfrom employees Contractwork trade receivables/payables Other Gross Impairments Net 21,228 767 628 8,713 171,606 328,661 6,915 321,745 1,603 2,563 427 2,136 21,228 767 628 8,713 173,209 331,224 7,343 323,881 6,239 484 502 3,500 15,757 170,529 6,581 163,948 1,689 2,772 427 2,345 6,239 484 502 3,500 17,446 173,301 7,009 166,293 Current 125,719 31December2012 Noncurrent 960 Total 126,679 Current 30September2012 Noncurrent 1,083 Total 145,131

144,048

The current trade receivables are mostly receivables with countryspecific maturities on which no interestischarged. Thenoncurrenttradereceivablesareforsuppliestocustomerspayableinonetofiveyears.Interest ischargedontheseatmarketrates. Asinthepreviousyear,noreceivableswereforfaitedduringtheshortfinancialyear. DerivativefinancialinstrumentsmainlyconsistofderivativeswithpositivefairvaluesofEUR767,000 (30September2012:EUR484,000)thatarenotusedforhedgingpurposes. Tradereceivablespastdueat31December2012beforeimpairmentlossesrecognisedonacollective basis:
inEURthousand Grosscarryingamount Individual impairments Tradereceivables Ofwhichatthe balance sheetdate neitherimpaired norpastdue upto30dayspastdue 31to60dayspastdue 61to90dayspastdue 91to180dayspastdue 181to360dayspastdue over360dayspastdue 31December 2012 156,620 6,387 150,232 97,027 13,993 6,843 4,135 6,192 2,350 645 30September 2012 154,870 6,599 148,271 95,580 15,389 4,738 3,379 3,049 3,205 594

Impairment losses totalling EUR6,387,000 (30 September 2012: EUR 6,599,000) were individually recognised on trade receivables with a gross carrying amount of EUR25,434,000 (30 September 2012:EUR28,935,000).

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There was no indication at the balance sheet date that debtors will not meet their payment obligationswithregardtotradereceivablesneitherimpairednorpastdue. Impairmentlossesontradereceivablesandotherfinancialassetshavechangedasfollows:
ShortFY2012 inEURthousand Balance at1October Additions Reversals Drawings Exchange difference Sale/reclassification Balance at31December/30 September Total 7,009 1,642 1,141 49 118 7,342 Ofwhichspecific allowances 6,599 1,033 1,118 49 78 6,387 Total 10,876 4,003 3,944 1,150 228 3,005 7,009 2011/2012 Of whichspecific allowances 9,904 3,865 3,778 1,150 206 2,449 6,599

Impairment losses totalling EUR 6,387,000 (30 September 2012: EUR 6,599,000) were individually recognised on trade receivables and other financial assets with a gross carrying amount of EUR 331,224,000 (30 September 2012: EUR 173,301,000). Trade receivables for which individual assessment did not reveal any indication of impairment were grouped into receivables with similar credit risk characteristics and collectively assessed for impairment based on historical loss experience. This resulted in the recognition of impairment losses on a collective basis totalling EUR 954,000(30September2012:EUR410,000).Theimpairedreceivablesareowedbyalargenumberof differentcustomers.ReceivablesaremonitoredbytheindividualGroupcompanies. DetailedinformationonfinancialinstrumentsisprovidedinNote34. Constructioncontractsinprogressatthebalancesheetdate:

inEURthousand Constructioncostsincurred plusrecognisedprofits Progressbillings Total

31December 2012 5,284 3,429 8,713

30September 2012 2,846 654 3,500

Revenue from construction contracts came to EUR 5,213,000 in the short financial year 2012 (2011/2012: EUR 3,500,000), comprising EUR 5,213,000 in the Port Solutions segment (2011/2012: EUR3,500,000inthePortSolutionssegment).Therewerenoretentionsatthebalancesheetdate.

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21. Othernonfinancialassets
inEURthousand Othertax receivables Advance payments Deferredcharges Other Gross Impairments Net Current 7,287 2,622 2,967 3,485 16,361 209 16,152 31December2012 Noncurrent 8 8 8 Total 7,287 2,622 2,967 3,493 16,369 209 16,160 30September2012 Current Noncurrent 7,339 3,334 4,111 3,587 18,372 209 18,163 1,073 1,073 1,073 0 Total 7,339 3,334 4,111 4,660 19,445 1,282 18,163

Thecarryingamountsofothernonfinancialassetslargelymatchtheirfairvalues. Impairmentlossesonothernonfinancialassetshavechangedasfollows:
ShortFY2012 Of which individual impairments inEURthousand Balanceat1October Additions Reversals Exchange differences Balanceat31December/30September Total 1,282 1,073 209 1,282 1,073 209 Total 1,092 193 3 1 1,282 2011/2012 Of which individual impairments 1,092 193 3 1 1,282

22. Inventories
inEURthousand Materialsandsupplies Workinprogress Finishedgoodsandproductsheldforresale Total 31December 2012 41,596 141,892 4,511 187,999 30September 2012 42,443 141,365 4,219 188,027

AtotalofEUR107,103,000(2011/2012:EUR549,218,000)ininventorieswererecognisedasexpense (material expenses) in the reporting period. This is net of EUR 841,000 in income from reversal of writedowns (2011/2012: EUR 2,161,000 income from reversal of writedowns). The gross value of writtendowninventoriesisEUR50,450,000(30September2012:EUR47,842,000).

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23. Cashandcashequivalents
Cashandcashequivalentsasat31December2012weremadeupasfollows:
inEURthousand Cashonhand Currentaccounts(bank) Fixedtermdeposits Other Total 31December 2012 77 35,914 18,074 57 54,122 30September 2012 57 31,870 23,878 141 55,947

The cashandcashequivalentsitemsin thestatementoffinancial positionand thestatementofcash flow are identical. EUR 1,041,000 (30 September 2012: EUR 1,082,000) are pledged as security for liabilities. Changes in cash and cash equivalents in the reporting period are shown in the statement of cash flow.

24. Noncurrentassetsheldforsaleandassociatedliabilities
Noncurrent assets held for sale and liabilities associated with noncurrent assets held for sale in the prioryearrelatetothefollowingcompanies: DemagCranes&ComponentsS.p.A.,ItalyaswellasitssubsidiaryDonatiSollevamentiS.r.l., ItalyDemagCranes&ComponentsS.A.U.,Spain DCCFranceHoldcoS.A.,FranceanditssubsidiaryDemagCranes&ComponentsS.A.S., France DemagCranes&ComponentsS.A.U.,Spain DemagCranes&ComponentsPty.Ltd.,Australia The companies were sold to the corresponding incountry Terex entities on 14December 2012 and deconsolidated. PleaseseeNote6fortheeffectsofthedeconsolidationonfinancialstatementitems.

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25. Shareholdersequity Subscribedcapital


DemagCranesAGssubscribedcapitalamountstoEUR21,172,993andisdividedinto21,172,993no parvaluebearershares.

ManagementBoardauthorisations
By resolution of the Annual General Meeting of 2 March 2011, the Management Board is authorised subject to Supervisory Board approval to increase the Companys share capital by up to EUR 10,586,000byissuingnewnoparvaluebearershares,eachcomprisingoneeuroofsharecapital,for cash or noncash consideration on one or more occasions by or before 1 March 2016 (authorised capital).Incircumstanceslistedintheauthorisingresolution,theManagementBoardisauthorisedto excludeexistingshareholdersstatutoryrightofpreemption. ByresolutionoftheCompanysAnnualGeneralMeetingof2March2010,theManagementBoardof Demag Cranes AG is further authorised, subject to Supervisory Board approval, to issue convertible and/or warrantlinked bearer bonds (collectively bonds) with limited or unlimited maturities up to an aggregate face value of EUR 210,000,000 on one or more occasions by or before 1 March 2015 andtogivethebondholdersconversionrightsand/oroptions(includingwithanattachedconversion obligation) to noparvalue bearer shares in the Company making up a maximum EUR 4,200,000 portion of the share capital in accordance with the detailed terms and conditions of the convertible or warrantlinked bond issue (conditional capital). The bonds are required to be issued solely for cash. No convertible bonds or warrantlinked bonds had been issued as at the 31 December 2012 balance sheetdate.

Additionalpaidincapital
Thechangeinadditionalpaidincapitalduringtheshortfinancialyear2011/2012relatestotheshare optionscheme(MatchingStockProgram).

Retainedearnings
Retained earnings consist of net income for the short financial year, accumulated profits carried forward less dividends, together with differences between the expected and actual defined benefit obligationandtheactualandexpectedreturnonplanassets.

Othercomprehensiveincome
Other comprehensive income comprises three items: availableforsale financial assets, and differencesarisingfromcurrencytranslation. The availableforsale financial assets item contains the accumulated net gain or loss recognised in equityonavailableforsalefinancialassets.

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Exchange rate effects from translating the financial statements of foreign entities whose functional currencyisnotthesameasDemagCranesAGsreportingcurrencyarereportedindifferencesarising fromcurrencytranslation. Exchange rate effects to the amount of EUR2,550,000 due to the deconsolidation of Demag Cranes &ComponentsPty.Ltd.,Australiaweredeductedinshortfinancialyear2012. The components of accumulated other comprehensive income presented in the statement of changesinequityarestatedafterincometax.Inthestatementofcomprehensiveincome,changesin the short financial year are presented before tax along with the tax effect relating to net income recogniseddirectlyinequity.Thetablebelowreconcilesthebeforetaxtotheaftertaxamounts.
inEURthousand Changesinthefairvalueofavailableforsalefinancialinstruments Changesaffectingprofitorloss Changesnotaffectingprofitorloss Deferredtax Actuarialgains/losses Changesnotaffectingprofitorloss Deferredtax Differencesarisingfromcurrencytranslation Changesaffectingprofitorloss Changesnotaffectingprofitorloss Of whichfrominvestmentsaccountedforusingthe equitymethod Netincomerecogniseddirectlyinequity at31December/30September 19 4 1 62,845 9,909 6 6,387 4,750 284 56,477 16 29 7 52,929 42,488 2,502 11,137 7,345 1,853 41,809 ShortFY2012 2011/2012

The above presentation also includes the portion of net income recognised directly in equity that is attributabletononcontrollinginterests.

Paidandproposeddividends
Under the domination and profit and loss transfer agreement entered into on 30 January 2012 between Terex Germany GmbH & Co. KG, Dsseldorf and Demag Cranes AG, Dsseldorf, the net income of EUR 60,175,000 for the short financial year 2012 (2011/2012: EUR 18,198,000) is to be transferredtoTerexGermanyGmbH&CoKG. The agreement further provides for an annual guaranteed dividend payment by Terex Germany GmbH&Co.KGtoalloutsideshareholdersofDemagCranesAGinthegrossamountofEUR3.33per nopar value share (EUR 3.04 net per nopar value share). The payment for the short financial year 2012isEUR0.83pershare(EUR0.76netpershare).

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26. Provisionsforpensionsandsimilarobligations
Theprovisionsforpensionsandsimilarobligationsaremadeupasfollows:
31December 2012 184,211 9,417 7,002 200,630 30September 2012 174,551 9,137 3 183,691

inEURthousand Definedbenefitobligation Deferredcompensation Similarobligations Total

Definedbenefitobligation
In Germany, Demag Cranes pays postemployment benefits to almost all retired employees. Outside Germany, postemployment benefits have been granted to employees in Switzerland. The level of postemployment benefit depends on salarybased entitlement and/or position in the Company and lengthofservice. Thedefinedbenefitobligationchangedasfollowsintheshortfinancialyear:
inEURthousand Definedbenefitobligation asat1October Currentservice cost Interestcost Exchange differences Contributionsbyplan participants Actuarial gains/losses Benefitspaid Otherdefined benefitobligations asat1October/30September Ofwhich funded unfunded 171,805 552 1,366 9,389 1,940 41 23,241 133 123 42 103 564 286 452 195,046 685 1,490 42 103 9,953 2,225 493 131,326 1,467 6,268 41,435 7,727 964 21,776 153,102 514 1,981 499 6,767 192 192 426 305 139 426 41,129 7,587 964 Germany ShortFY2012 Othercountries Total Germany 2011/2012 Othercountries Total

181,132 181,132

23,469 20,390 3,078

204,601 20,390 184,211

171,805 171,805

23,241 20,496 2,745

195,046 20,496 174,551

The actuarial gains and losses result from differences between the actual and expected benefit obligation. The change in accumulated actuarial gains and losses mainly relates to a change in the discountratefrom3.15%to2.8%. The table below reconciles the present value of the defined benefit obligation to the amount of the obligationstatedinthestatementoffinancialposition:

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30September inEURthousand Definedbenefitobligation Fairvalue ofplanassets Amountnotrecognisedasasset Advance payments Provisionfordefinedbenefitobligation 31December 2012 204,601 20,390 184,211 2012 195,046 20,496 174,551 2011 153,102 18,467 134,634 2010 167,175 19,209 147,966 2009 140,242 16,600 123,642

Thefairvalueofplanassetschangedasfollows:
inEURthousand Fairvalueofplanassetsat1October Expectedreturnonplanassets Contributionsbythe employer Contributionsbyplanparticipants Pensionbenefits Actuarial gains(+)/losses( ) Exchange difference Reversals Fairvalueofplanassetsat31December/30September Fairvalue ofplanassets ShortFY2012 20,496 190 104 103 286 254 37 20,390 64 2011/2012 18,467 764 470 426 139 64 164 20,496 828

OnlyplansoutsideGermanyarefunded. Planassetsaremadeupasfollows:
in% Equityinstruments Debtinstruments Property Othershortterminvestments Total 31December 2012 24 43 19 14 100 30September 2012 28 50 14 9 100

The investment objectives of Demag Cranes are to maximise returns while limiting risk. Investments in debt and equity instruments, cash and cash equivalents and property are made in observance of theGroupsriskmanagementpolicies.Thediversifiedsecuritiesportfolioincludesbothdomesticand foreignsecurities.Thesecuritiesportfolioisadministeredbythetrustees. The expected return on plan assets is based on average market expectations for the period over whichtheobligationissettled.

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Basedonactuarialcalculations,thecompositionofthepensionexpenseisasfollows:
inEURthousand Currentservice cost Interestcost Expectedreturn onplanassets Other Net Includedin Costofsales Selling,general and administrative expenses researchanddevelopment expenses interestand similarincome interest andsimilarexpenses 1Octoberto31December2012 Germany Othercountries 552 1,366 1,918 320 232 0 1,366 133 123 190 452 386 218 101 190 123 Total 685 1,490 190 452 1,533 102 131 0 190 1,490 1Octoberto30September2011/2012 Germany Othercountries 1,467 6,268 7,736 842 625 0 6,268 514 499 764 249 345 169 764 499 Total 1,981 6,767 764 0 7,985 1,187 794 0 764 6,767

The assumed discount rates and rates of increase for wages, salaries and benefits used to compute the defined benefit obligation, including the longterm return on plan assets, vary with economic conditionsinthecountrieswherethepensionplansareineffect. Theactuarialassumptionsareasfollows:
ShortFY2012 in% Discountrate Expectedsalaryincrease Expectedincreasesinpensions Expectedreturnonplanassets Germany 2.8 2.5 2.0 Other countries 1.8 1.0 3.5 2011/2012 Germany 3.15 2.5 2.0 Other countries 2.00 1.25 3.75

Experienceadjustmentsareasfollows:
30September in% Definedbenefitobligation Planassets 31December 2012 0.9 1.2 2012 0.1 0.3 2011 0.8 2.6 2010 0.7 1.7 2009 0.2 7.9

Experience adjustments are the ratio of the portion of actuarial gains and losses comprising differences between previous computation assumptions and what has actually occurred to the amountofthedefined benefitobligationandplanassetsatthebalancesheet date.Thefiguresstate the amount by which it was necessary to increase (+) or decrease () the estimated figures for the definedbenefitobligation/planassets.

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Deferredcompensation
Under agreements between Group companies and employees, a portion of employees earnings is withheld and paid out at a later date. The employee benefit entitlements resulting from deferred compensation are computed using actuarial methods. EUR9,417,000 in deferred compensation was recognisedasliabilitiesintheshortfinancialyear2012(2011/2012:EUR9,137,000).

Similarobligations
Due to the clarification of a statutory regulation in Brazil, an obligation to the amount of EUR6,999,000 was recognised for the first time as a provision for benefits following the termination ofrespectiveemploymentcontracts.

Definedcontributionplans
In addition to the defined benefit plans, payments are made notably in Germany, Brazil, Denmark, the USA and the UK into defined contribution plans. Under defined contribution arrangements, Demag Cranes pays contributions by law, by contractual agreement or voluntarily into state or private pension funds. Contributions are recognised as an expense in the year they are paid. EUR4,775,000 was recognised as an expense in the short financial year 2012 (2011/2012: EUR 16,120,000). This included EUR3,859,000 (2011/2012: EUR 14,758,000) in contributions to the state pensionschemeinGermany.

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27. Otherprovisions
inEURthousand Restructuring Warrantiesand customer complaints Legal and litigation Other Total 31December2012 Current Noncurrent 5,637 Total 5,637 30September2012 Current Noncurrent 4,235 Total 4,235

14,764 2,016 1,221 23,639

2,600 2,600

17,365 2,016 1,221 26,239

15,544 2,203 915 22,897

2,681 2,681

18,225 2,203 915 25,578

Warrantiesand customer complaints inEURthousand Balance at1October2011 Change inthe scope ofthe ConsolidatedFinancial Statements Additional provisionsmade Amountsused Unusedamountsreversed Reclassificationasliabilitiesin connectionwithassetsheldfor sale Exchange difference Otherchanges Balance at30September2012 Balance at1October2012 Additional provisionsmade Amountsused Unusedamountsreversed Exchange difference Otherchanges Balance at31December2012 Restructuring 2,478 22,548

Legal and litigation 4,297

Other 1,304

Total 30,628

9 4,227 1,829 494

578 8,708 2,158 9,451

339 286 1,405 129

46 512 836 60

972 13,734 6,228 10,135

139 1 4,235 4,235 1,509 107 5,637

1,042 198 18,225 18,225 503 319 972 72 17,365

432 76 2,203 2,203 3 118 71 2,017

21 62 915 915 516 191 19 1,221

1,634 185 0 25,578 25,578 2,531 735 972 143 19 26,239

The restructuring provision is based on managements best estimate of the present value of expendituredirectlyassociatedwiththerestructuringandnotattributabletooperatingactivities. Group companies give various product warranties under which they provide a warranty with a specific warranty period for supplied products and rendered services. Provisions for expected costs under product warranties are recognised when products are sold. The warranty provisions include individual provisions and provisions recognised on a collective basis. The material warranty claims willbesettledinthenexttwoyears. The provisions for customer complaints relate to known individual risks in connection with notified defects. Provisions for risks of threatened and pending litigation against Demag Cranes Group companies are recognised if it is more likely than not that a liability will result. Estimates of this probability

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incorporate judgements of lawyers and appraisers representing the Company. The amount recognisedasaliabilityistheprobable amountofanycompensationclaimsandtheprobablecostof any sanctions. Demag Cranes estimates that the litigation to which the provisions relate will not result in costs significantly in excess of the provisions recognised as at 31 December 2012. Uncertain obligations are presented separately from any reimbursement claims. Demag Cranes recognises claimsagainstthirdpartieswherethecriteriaforrecognitionofanassetaresatisfied.

28. Loansandborrowings
Loansandborrowingsaremadeupasfollows:
inEURthousand Finance lease liabilities Loansandborrowingsfrom relatedparties Othercurrentliabilities Other loansandborrowings Total Current 31December2012 Noncurrent Total 30September2012 Current Non current Total

87 87

105 105

33 33 42 42 86,755 86,755 8,780 8,780 579 579 648 648 86,755 699 87,454 8,780 794 9,574

Thecarryingamountsofloansandborrowingsapproximatetotheirfairvalues. Other current liabilities mainly consists of shortterm liabilities from the cash pooling arrangement with Terex Corporation to the amount of EUR 78,275,000 and from intragroup transfers to Terex to theamountofEUR4,116,000. Information on the Groups interest and exchange rate risks is provided in Note 34 (Additional disclosuresonfinancialinstruments).

FinancingoftheDemagCranesGroup
The domination and profit and loss transfer agreement between Demag Cranes AG and Terex Germany GmbH&Co.KG, anindirectwhollyowned subsidiaryofTerexCorporation,Westport,USA, cameintoeffecton18April2012. Since 16 May 2012, Demag Cranes has come under Terex Corporations cash pooling arrangements. Underthecashpoolingarrangements,DemagCranesisableborrowuptoEUR150.0milliononshort noticeatanytime.TherefinancinginterestratewithTerexisLIBORplusanarmslengthmargin. EUR78,257,000 was borrowed under the cash pooling arrangements as at 31December 2012. This mainly relates to Demag Cranes AG in the amount of EUR74,668,000. At the same time, there were receivables to the amount of EUR168,376,000 under the cash pooling arrangements as at 31December 2012. This mainly relates to DCCGmbH in the amount of EUR145,177,000 and GottwaldPortTechnologyGmbHintheamountofEUR17,478,000. Demag Cranes additionally has guarantee facilities with various banks and two insurers (EUR97,599,000 maximum) and via ancillary facilities with Terex Germany GmbH & Co. KG (EUR33,100,000 maximum). As at 31 December 2012, drawings on the guarantee facilities with

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banks total EUR81,047,000 (30 September 2012: EUR84,096,000) and drawings on the ancillary facilities with Terex Germany GmbH & Co. KG total EUR19,166,000 (30 September 2012: EUR18,563,000).

29. Tradepayablesandotherfinancialliabilities
inEURthousand Trade payables Accruedliabilities Derivative financial instruments Severance benefits Othersellingrelatedliabilities Other Total Current 31December2012 Noncurrent Total 44,643 24,116 36 2,377 5,934 12,638 89,743 30September2012 Current Noncurrent 48,857 25,938 176 2,262 128 5,683 16,120 91,218 7,945 Total 48,857 25,938 176 2,262 5,810 16,120 99,163 44,643 24,116 36 2,377 120 5,814 12,638 81,552 8,191

30. Othernonfinancialliabilities
inEURthousand Longyearservice Partial retirement Otherpersonnel liabilities Value addedtax Social security,payroll tax andchurchtax Other Total Current 25,153 4,181 6,879 2,698 38,912 31December2012 Noncurrent 1,353 7,453 6 8,812 Total 1,353 7,453 25,153 4,181 6,879 2,704 47,723 30September2012 Current Noncurrent 37,237 4,842 4,180 3,791 50,050 1,709 8,364 11 10,084 Total 1,709 8,364 37,237 4,842 4,180 3,802 60,134

Demag Cranes recognises primarily in Germany liabilities for amounts payable and topup amounts under existing partial retirement plans and for expected topup amounts under partial retirement plans whose signing is probable as of the balance sheet date. The amount of the obligation under partial retirement plans is measured in accordance with actuarial principles. The obligationincorporatesthefullamountofincreasesundersignedpartialretirementplans.Aprorata amount is recognised for wages and salaries that continue to be payable during the nonworking phase of partial retirement corresponding to service rendered during the working phase. Topup amounts for impending additional plans are included in the liability in the expected amount of entitlements to pay increases. Factors taken into account in measurement of the obligation include the end of legislative provision for partial retirement plans and the maximum levels of benefit payabletoemployeesinpartialretirementunderthelawandcollectiveagreements.

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31. Deferredtax
Deferredtaxassetsandliabilitiesrelatetothefollowingitems:
inEURthousand Intangible assets Property,plantandequipment Inventories Otherassets Tax losscarryforwards Provisionsandliabilities Other Othertaxbeforeimpairmentandnetting Impairments Netting Total 31December2012 Assets Liabilities 13 569 2,949 556 5,982 4,018 187 14,275 1,468 12,807 218 904 30 256 560 201 2,169 2,169 30September2012 Assets Liabilities 16 651 3,525 883 4,492 1,731 902 12,199 1,239 10,960 21 830 154 418 530 161 2,114 2,114

Deferredtaxrecogniseddirectlyinequity:
inEURthousand Actuarial gains/losses Otherequityitems Total 31December 2012 878 4 882 30September 2012 886 3 889

Changes in deferred taxes are normally recognised in profit or loss. As an exception from this rule, deferredtaxesarerecogniseddirectlyinequitywhentheyrelatetotransactionsoreventsthataffect net income recognised directly in equity or another equity item. Further information is provided in Note25(Shareholdersequity). Deferred tax assets are only recognised to the extent that it is probable that there will be sufficient taxable profits against which to utilise the benefits. Demag Cranes considers it probable that the recogniseddeferredtaxassetswillbeutilised. No deferred tax liabilities have been recognised for EUR 4,753,000 (2011/2012: EUR 7,752,000) in temporary differences in connection with investments in subsidiaries and joint ventures where it is notprobablethatthetemporarydifferenceswillreverseintheforeseeablefuture. Consolidatedentitieshavetaxlosscarryforwardsasfollows:
inEURthousand Germany Corporationtax Trade tax Othercountries 31December2012 6 6 21,502 30September 2012 2 2 16,451

Tax losses can be carried forward indefinitely in Germany. Of the foreign loss carryforwards, EUR 11,779,000 (2011/2012: EUR 9,632,000) expire in the next five years and EUR 9,723,000 (2011/2012:

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EUR 6,819,000) in more than five years. In certain jurisdictions, the utilisation of tax loss carryforwards is limited by minimum taxation rules. Writedowns were recognised on corporate tax losscarryforwardsofEUR18,846,000(2011/2012:EUR15,693,000).WritedownsofEUR1,000were recognisedontradetaxlosscarryforwards(2011/2012:EUR0,000). Deferred tax assets recognised by Demag Cranes for tax loss carryforwards decrease in future periodsasfollowsunlesspreviouslychargeableagainstcurrentincome:
inEURthousand Upto1year 1to2years 2to3years 3to4years 4to5years More than5years Total 31December 2012 2,606 192 144 60 2,980 5,982 30September 2012 2,277 131 2,084 4,492

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Otherdisclosures
32. Statementofcashflow
The statement of cash flow shows changes in cash and cash equivalents due to inflows and outflows during the short financial year. The statement shows cash flow from operating, investing and financing activities and the resulting changes in cash and cash equivalents. Due to currency translation effects, changes presented in it relating to items in the statement of financial position cannotbeinferreddirectlyfromthestatementoffinancialposition.Thestartingpointforcomputing cash flow from operating activities is net income after tax. Under the indirect method of reporting cash flow from operating activities, noncash income items are eliminated and cash operating transactions that do not affect profit or lossare added in. Cash flow from investing activities consists of payments for investments and receipts from divestments. Cash flow from financing activities shows cash changes in equity and debt capital from borrowing. Cash and cash equivalents include cashonhandandinbankswitharesidualmaturityofuptothreemonths. Cash flow from investing activities includes the EUR 77,247,000 proceeds on the sale of six subsidiaries with effect from 14December 2012. The selling price of the companies was EUR83,748,000.ThisisafterdeductionofEUR6,501,000incashandcashequivalents. Cashflowfrominvestingactivitiesinfinancialyear2011/2012includesEUR96.501,000fromthesale of the US companies. The selling price for the two companies was EUR 102,433,000. This is after deductionofEUR5,932,000incashandcashequivalents. As at 31 December 2012, EUR78,257,000 was borrowed under the cash pooling arrangements with Terex begun in May 2012. The balance of loans, borrowings and financial receivables decreased by EUR 74,015,000 (2011/2012: decrease of EUR162,213,000). These figures are reported in cash flow from financing activities under payments/proceeds from loans and borrowings. Further information onfinancingisprovidedinNote28. Nodividends werepaidoutto theshareholdersofDemagCranes AGintheshortfinancialyear2012 (2011/2012:dividendsofEUR847,000).

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33. Segmentreporting
SegmentreportingatDemagCranesreflectsinternalreporting.ForinternalcontrolofDemagCranes, the Management Board uses operating earnings before interest and tax (EBIT) adjusted to eliminate the effects of acquisitions, restructuring and severance payments. Segment earnings and the managementadjustmentsarenotdefinedinIFRS.Theymaydifferfromthedefinitionsusedbyother companies;thislimitstheusefulnessofintercompanycomparisons. The Demag Cranes Group consists of two reportable segments based on type of product and service (30 September 2012: three reportable segments): Material Handling and Port Solutions. The Demag Cranes Group has had a new management structure since 1 October 2012. The former Industrial CranesandServicessegmentswereamalgamatedintotheMaterialHandlingsegment. TheMaterialHandlingsegmentintegratesthedevelopment,production,sale,assemblyanddelivery of Industrial Cranes, including components and material handling solutions, the inspection, maintenance, repair and refurbishment of used cranes, and the sale of spare parts. Activities of the Port Solutions segment (formerly the Port Technology segment) consist of developing, manufacturing, selling, assembling, delivering and maintaining Mobile Harbour Cranes and automated container handling systems, including the provision of storage and integrated software solutions.TheUnallocateditemrelatestoholdingcompanycosts. The figures for the previous year were correspondingly adapted to the two new Material Handling andPortSolutionssegments. The segment information provides in summary form the disclosures without management adjustments for each segment (revenue, earnings before interest and tax (EBIT), segment assets, segmentliabilitiesandsegment capital expenditure).Thereportedamountsrepresenttheportionof IFRSbasisGroupfiguresthatcanbedirectlyattributedtosegmentsorcanbeallocatedtothemona reasonable basis. Disclosures on segments with management adjustments are prefixed operating (operating depreciation, amortisation and impairments; operating earnings before interest and tax (EBIT)).

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Thetablebelowpresentsthecontrolparametersusedtomeasuresegmentperformance.
Operatingdepreciation,amortisation andimpairments ShortFY2012 2011/2012 3,318 1,108 4,425 682 5,107 13,511 4,514 18,025 2,686 20,711

inEURthousand Material Handling PortSolutions Reportable segments Unallocated DemagCranesGroup

Revenue ShortFY2012 167,339 59,801 227,140 227,140

2011/2012 858,463 264,804 1,123,267 1,123,267

Grossprofit ShortFY2012 37,102 14,904 52,006 52,006

2011/2012 262,897 54,010 316,906 316,906

There was no material intersegment revenue in the short financial year 2012 or in financial year 2011/2012. Operating adjustments in the short financial year 2012 relate to the EUR 62,357,000 gain on the sale of the six countryspecific subsidiaries. Operating adjustments in financial year 2011/2012 mainly relate to the EUR 57,205,000 proceeds on the sale of the US companies. This was countered by EUR 3,439,000 (financial year 2011/2012: EUR 3,761,000) in restructuring costs and the EUR 4,197,000 (financialyear2011/2012:EUR5,654,000)intragrouptransfertoTerex. Material noncash expenses other than depreciation, amortisation and impairments in the financial year amounted to EUR 0,000 (2011/2012: EUR 0,000). Restructuring costs in the short financial year cametoEUR6,000(2011/2012:EUR488,000). ReconciliationtoIFRSbasedGroupEBIT: The table below reconciles segment EBIT as represented by operating earnings before interest and taxtoDemagCranesGroupearningsbeforeinterestandtax(EBIT).
Operatingearnings before interest tax inEURthousand Material Handling PortSolutions Reportablesegments Unallocated DemagCranesGroup ShortFY2012 831 2,588 3,419 703 4,123 2011/2012 81,268 13,369 94,637 5,425 89,212

Reconciliation ShortFY2012 56,670 496 56,174 428 55,747 2011/2012 47,138 1,215 45,924 4,880 41,044

Earningsbeforeinterestandtax(EBIT) ShortFY2012 57,501 2,093 59,594 276 59,869 2011/2012 128,406 12,155 140,561 10,305 130,256

The table below reconciles earnings before interest and tax (EBIT) to Demag Cranes Group earnings beforetax(EBT).
inEURthousand Earningsbefore interestandtax (EBIT) Interestandsimilarincome Interestandsimilarexpenses Earningsbefore tax ShortFY2012 59,869 782 2,949 57,703 2011/2012 130,256 3,158 16,449 116,966

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Thetablebelowshowssegmentassets,segmentliabilitiesandsegment capitalexpendituretogether withtheirreconciliationtotheGroupfigures.


Segmentassets inEURthousand Material Handling PortSolutions Reportable segments Unallocated DemagCranesGroup Segmentliabilities Segmentcapitalexpenditure ShortFY2012 6,772 1,090 7,862 229 8,091 2011/2012 14,752 4,283 19,035 3,236 22,272

31December2012 30September2012 31December2012 30September2012 447,141 168,279 615,420 268,825 884,245 498,212 174,094 672,306 130,193 802,499 301,956 159,589 461,545 163,865 625,411 326,937 102,652 429,590 96,784 526,373

The segment assets and segment liabilities do not include any effects relating to financing or to current or deferred tax. The effects of pensions are only included to the extent they are directly attributabletosegments.

Geographicalreporting
The table below provides supplementary information on the geographical distribution of the Demag CranesGroupsrevenueandnoncurrentassets.
Revenue inEURthousand Germany RestofEurope NorthandSouthAmerica Otherregions Total ShortFY2012 50,690 81,300 26,838 68,312 227,140 2011/2012 226,748 328,457 237,140 330,922 1,123,267 Noncurrentassets 31December 30September 2012 2012 206,372 36,779 25,646 15,564 284,361 203,947 36,320 25,283 16,714 282,263

Revenueisallocatedbyregionbasedonthedestinationcountryofgoodssold.

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34. Additionaldisclosuresonfinancialinstruments
ThetablesthatfollowshowthecarryingamountsoffinancialinstrumentsineachcategorydefinedinIAS39andstatetheirfairvaluestogetherwiththesource ofthevaluationusedforeachclassoffinancialinstruments.
31December2012 Of whichwithinthe measurementin scope of IFRS7 accordance withIAS Carryingamount 39 54,122 54,122 LaR 149,278 149,278 LaR 174,604 174,604 767 173,837 730 10 720 378,733 87,454 33 87 87,334 44,643 45,101 36 45,065 177,197 767 173,837 730 10 720 378,733 87,454 33 87 87,334 44,643 45,101 36 45,065 177,197 HfT LaR AfS AfS Fairvaluebasedon: (Continued) Cost 54,122 149,278 173,837 173,837 10 10 377,247 87,454 33 87 87,334 44,643 45,065 45,065 177,161 Nonobservable Quotedmarketvalue Othermarketprices marketprices(level (level 1) (level 2) 3) 720 767 720 720 720 767 767 36 36 36

inEURthousand Cashandcashequivalents Trade receivables Otherfinancialassets Derivativesnotindesignatedhedgingrelationships Derivativesindesignatedhedgingrelationships Otherfinancial assets Otherinvestments Investmentinassociates Noncurrentassets Otherfinancialassets Loansandborrowings Loansandborrowingsfromrelatedparties Finance leases Otherfinancial liabilities Trade payables Otherfinancialliabilities Derivativesnotindesignatedhedgingrelationships Otherfinancial liabilities Totalfinancialliabilities

Fairvalue 54,122 149,278 174,604 767 173,837 720 720 378,723 87,454 33 87 87,334 44,643 45,101 36 45,065 177,161

AmC AmC AmC AmC HfT AmC

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31December2012 Ofwhichwithinthe Categoriesof scope ofIFRS7 measurementin accordance withIAS AfS 730 377,237 LaR 730 177,160 HfT AmC Fairvalue basedon: (Continued) Cost 10 377,237 177,160 Quotedmarket value (level 1) 720 Othermarket prices(level 2) 730 Nonobservable marketprices (level 3)

inEURthousand Available forsale financial assets Loansandreceivables Heldfortradingatfairvalue throughprofitorloss Financial liabilitiesmeasuredatamortisedcost Notapplicable

Carryingamount 730 377,237 730 177,160

Fairvalue 720 377,237 730

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30September2012 Ofwhichwithin Categoriesof the scope ofIFRS measurementin Carryingamount accordance withIAS 55,947 Tradereceivables Otherfinancialassets Derivativesnotindesignatedhedging relationships Derivativesindesignatedhedging relationships Otherfinancial assets Otherinvestments Investmentinassociates Noncurrentassets Otherfinancialassets Loansandborrowings Revolvingcreditfacility,net Loansandborrowingsfrom relatedparties Finance leases Otherfinancial liabilities Tradepayables Otherfinancialliabilities Derivativesnotindesignatedhedging relationships Derivativesindesignatedhedging relationships Otherfinancial liabilities Totalfinancialliabilities 147,861 147,861 6,234 6,234 484 484 5,750 5,750 733 733 10 723 210,775 16,056 10 723 210,775 16,056 LaR 147,861 147,861 5,750 6,234 HfT n/a LaR AfS AfS 484 723 723 723 484 484 484 176 176 176 55,947 Fairvaluebasedon: (Continued) Cost Quotedmarket value (level 1) Othermarket prices(level 2) Nonobservable marketprices (level 3)

inEURthousand Cashandcashequivalents

Fairvalue 55,947

LaR 55,947

5,750 5,750 10 723 10 723 209,568 210,765 16,056 16,056

n/a

42 42 105 105 15,910 15,910 48,857 48,857 50,307 50,307 176 176 50,130 50,130 115,219 115,219

AmC 42 42 AmC 105 105 AmC 15,910 15,910 AmC 48,857 48,857 50,130 50,307 HfT 176

n/a AmC 50,130 50,130 115,043 115,219

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30September2012 Fairvaluebasedon: Ofwhichwithin Categoriesof Nonobservable the scope ofIFRS measurementin (Continued) marketprices Quotedmarket Othermarket Cost accordance with Fairvalue (level 3) Carryingamount value (level 1) prices(level 2) 733 733 AfS 10 723 723 209,558 209,558 LaR 209,558 209,558 308 115,043 308 115,043 HfT AmC 115,043 308 115,043 308

inEURthousand Available forsale financial assets Loansandreceivables Heldfortradingatfairvalue throughprofitorloss Financial liabilitiesmeasuredatamortisedcost Notapplicable

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Cash and cash equivalents, trade receivables and other financial assets mostly have short residual maturities.Theircarryingamountatthebalancesheetdatethereforeapproximatestofairvalue.The sameappliestotradepayablesandotherfinancialliabilities.Whereotherinvestmentsaretradedon an active market, their fair value is the quoted market price. The fair value of longterm debt not traded on an active market and of interestbearing loans and borrowings is measured by discounting the respective expected future cash flows. The discount rate used is the prevailing market rate of interest for the applicable term to maturity. Individual features of financial instruments are taken into account by applying market credit and liquidity spreads when measuring fair value. It is not possible for investments in associates to be carried at fair value because their future cash flows cannot be reliably determined and no information is available on recent transactions for similar investments. The fair value of derivatives is based in the case of foreign exchange contracts on the EuropeanCentralBankreferenceratesadjustedfortheapplicableinterestratedifferential(premium or discount). The fair value of interest rate derivatives is measured using generally accepted interest rateyieldcurves. Noreclassificationsbetweenfairvaluehierarchylevelswererequiredinthepastshortfinancialyear.

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The tables that follow show the undiscounted contractual interest payments and payments on principalforfinancialliabilitieswithinthescopeofIFRS7:
31December2012 Outflowof Outflowof resourcesintothe resourcesinto nextreporting the nextbutone 8 68 86,900 86,976 44,643 36 36,047 89,743 176,719 8 20 230 258 171 171 429 Outflowof resourcesata later date 16 204 220 6,609 6,609 13,217

inEURthousand Loansandborrowingsfromrelatedparties Finance leaseliabilities Otherfinancial liabilities Outflowofresourcesfromloansandborrowings Trade payables Derivativesnotindesignatedhedgingrelationships Otherfinancial liabilities Trade payablesand otherfinancialliabilities Outflowofresourcesfromloansandborrowings withinthe scope ofIFRS7

Carryingamount 33 87 87,334 87,454 44,643 36 45,065 89,743 177,197

30September2012 Outflowof Outflowof resourcesintothe resourcesinto nextreporting the nextbutone period reportingperiod inEURthousand Loansandborrowingsfromrelatedparties Finance leaseliabilities Otherfinancial liabilities Outflowofresourcesfromloansandborrowings Trade payables Derivativesnotindesignatedhedgingrelationships Otherfinancial liabilities Trade payablesand otherfinancialliabilities Outflowofresourcesfromloansandborrowings withinthe scope ofIFRS7 Carryingamount 42 105 15,910 16,056 48,857 176 50,130 99,163 115,219 8 80 15,407 15,496 48,857 176 38,476 99,163 114,659 8 33 235 277 178 178 455

Outflowof resourcesata laterdate

25 267 292 7,260 7,260 14,519

Forinterestbearingloansandborrowingswithvariableratesofinterest,interestpaymentsinfuture reporting periods are based on the interest rates prevailing at the balance sheet date. Financial liabilitiesthatcanberepaidatanytimeareassignedtotheearliesttimeband.

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ThenetgainsorlossesoneachIAS39categoryareasfollows:
Loansandreceivables inEURthousand Interestincome Interestcost Dividends Income arisingfromcurrency translation Expensesarisingfrom currencytranslation Impairments Unusedamountsreversed Impairments Fairvalue gainsandlosses Disposal gainsandlosses Netgainsorlosses ShortFY2012 366 1,105 650 575 1,396 2011/2012 1,838 6,493 4,885 2,227 5,672 Available forsale financial assets ShortFY2012 23 2011/2012 58 58 Heldfortradingatfairvalue throughprofitorloss ShortFY2012 2011/2012 Financial liabilitiesmeasuredat amortisedcost ShortFY2012 331 196 2,029 2,165 2011/2012 6,550 2,713 4,282 8,120

23

Interest income on impaired financial assets came to EUR 0,000 in the short financial year (2011/2012:EUR0,000). Interest on financial instruments and currency translation gains and losses on interestbearing payables and receivables are contained in interest and similar income and interest and similar expenses. Currency translation gains and losses on trade payables and receivables and other financial assets and liabilities are contained in other operating income and other operating expenses. Interest and similar income and interest and similar expenses also contain gains and losses on the at fair value through profit or loss category, which comprises both interest and currency translation gains and losses. Impairments on trade receivables in the loans and receivables categoryareincludedintheselling,generalandadministrativeexpensesitem.

Derivativefinancialinstruments
Demag Cranes uses derivative financial instruments in the management of financial risk to hedge its risk exposure on assets and liabilities, contractual claims and obligations, and planned transactions. The risk of adverse exchange rate changes is hedged with foreign exchange contracts that even out thecashflowsonforeigncurrencyordersnotyetsettledoraccepted. The table below shows the notional amounts and fair values of derivative financial instruments held atthebalancesheetdate.
31December2012 30September2012 Notionalamount Fairvalue Notionalamount Fairvalue 18,300 767 18,460 484

inEURthousand Assets: Currencycontracts Interestrate contracts Shareholdersequityand liabilities: Currencycontracts Interestrate contracts Total

820 19,121

36 731

12,661 31,121

176 308

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Positive fair values of derivative financial instruments are included in the statement of financial positioninotherfinancialassets,andnegativefairvaluesinotherfinancialliabilities.

Financialriskmanagement
Demag Cranes is exposed by its global business operations to various types of risk. These include currency risk, credit risk and interest rate risk. Targeted financial risk management is used to minimise any adverse impact of this risk on the Demag Cranes financial position, financial performance and cash flows. Among other things, this involves the use of derivative financial instruments.TheriskmanagementsystemisdescribedintheManagementReport. Currencyrisk Demag Cranes maintains global business relationships and does business in many different currencies.Theriskofadverseexchangeratechangesishedgedwithforeignexchangecontractsthat even out the cash flows on foreign currency orders not yet settled or accepted. The accounting treatment of hedges and the impact of valuation of derivative financial instruments are described in Note4. Creditrisk DemagCranesisexposedtocreditriskequaltothecarryingamountofderivativeandnonderivative financialassetsplusfinancialguaranteesgivenintheamountofEUR0,000(2011/2012:EUR0,000). Demag Cranes gives supplier credit in the normal course of business. The Company therefore assesses debtors on an ongoing basis with regard to specific customer financial conditions but does notgenerallyrequirespecificsecurityforreceivables.Doubtfuldebtsareaccountedforina doubtful debts allowance, taking into account credit risk based on collection experience and other information.DemagCranescountersspecificcreditriskbyonlydoingbusinesswithpartieswithgood credit standing, primarily based on the ratings of national and international trade credit rating agencies, and by rigorously observing the risk limit laid down by the trade credit insurer. An amount of EUR 21,477,000 was held in security at 31 December 2012 (30 September 2012: EUR 19,189,000). Thismostlyconsistedofretentionsoftitle. Interestraterisk Since May 2012, Demag Cranes has come under Terex Corporations cash pooling arrangements. Funds are both borrowed and invested through the cash pooling arrangements. Shortterm variable interest rates are applied in each instance on the basis of LIBOR plus an arms length margin. Demag Cranes is exposed to interest rate risk in the amount of drawings under the cash pooling arrangements. Sensitivityanalysis The types of market risk to which Demag Cranes is exposed are currency risk and interest rate risk. The Company has prepared a sensitivity analysis for each of these two types of risk showing how profit or loss for the short financial year and equity at the balance sheet date would have been

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affected by changes in the relevant risk variable. The Company assumes for these purposes that the risk situation at the respective balance sheet date is representative of risk exposure during the reportingperiodandthecomparativeperiod. The countries and currencies in relation to which Demag Cranes AG has significant exchange rate exposure are the USA (USD), the UK (GBP), South Africa (ZAR), the Czech Republic (CZK) and China (CNY). A 10% (30 September 2012: 10%) appreciation or depreciation of the euro relative to these foreign currencies at the balance sheet date would have resulted in a EUR 12,000 decrease (2011/2012: EUR 595,000 decrease) or a EUR 35,000 decrease (2011/2012: EUR 368,000 increase) in netincomeaftertax.
31December2012 30September2012 10% 10% 10% 10% appreciationof depreciationof appreciationof depreciationof EURrelativeto EURrelativeto EURrelative to EURrelative to source currency source currency source currency source currency 176 418 165 694 275 12 098 388 165 694 275 35 409 170 102 609 668 595 665 142 102 609 668 368

inEURthousand EUR:USD EUR:GBP EUR:ZAR EUR:CZK EUR:CNY Total

A100basispointincreaseordecreaseinmarketinterestratesatthebalancesheet datewouldhave decreased net income after tax by EUR 5,000 (2011/2012: EUR 5,000) or increased it by EUR 5,000 (2011/2012:EUR5,000).

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35. Capitalmanagement
Capitalmanagementfocusesontheactivemanagementofnetworkingcapitalandliquidity. Net working capital is composed of inventories, trade payables and receivables, and advance payments made and received, and is used by Demag Cranes AG as a management parameter for capitalemployed:
inEURthousand Inventories Advance paymentsmade Trade receivables Trade payables Advance paymentsreceived Networkingcapital 31December 2012 187,999 6,060 149,278 44,643 150,881 147,814 30September 2012 188,027 4,072 147,861 48,857 86,945 204,159

Other indicators and control parameters for active management of the Groups cash resources comprise free cash flow before financing and net debt. These are also the basis for evaluation and targetedcontroloffinancingstructureandreturnoncapitalemployed:
inEURthousand Noncurrentloansandborrowings Revolvingcreditfacility,gross Othernoncurrentloansandborrowings Otherfinancialliabilities Derivative financial instruments Currentloansandborrowings Revolvingcreditfacility,gross Othercurrentfinancial assets Availableforsaleliabilities Cashandcashequivalents Othercurrentfinancialassets Derivative financial instruments Other Receivablesfromaffiliatedcompaniesandotherequityinvestments Loans Netdebt 31December 2012 699 699 86,755 86,755 54,122 171,590 171,590 168,376 3,214 138,257 30September 2012 794 794 8,780 8,780 35,333 55,947 15,734 15,734 12,445 3,289 26,773

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36. Contractualcommitments
Contractualcommitmentsat31December2012:
inEURthousand Operatingleasecommitments Of which lessthan1year 1yearto5years more than5years Purchasecommitments Intangible assets Of which lessthan1year 1yearto5years more than5years Property,plantandequipment Of which lessthan1year 1yearto5years more than5years Inventories Of which lessthan1year 1yearto5years more than5years Otherassets Of which lessthan1year 1yearto5years more than5years Total 31December 2012 33,237 9,699 21,537 2,001 81,060 235 235 3,309 3,277 32 71,189 64,485 6,704 6,327 5,981 346 114,296 30September 2012 42,172 14,161 24,716 3,295 80,525 396 396 4,090 4,057 33 69,940 68,162 1779 6,099 5,765 334 122,698

Lease payments under operating leases are recognised as expense on a straightline basis over the lease term. Expenses under operating leases amounted to EUR 5,381,000 in the short financial year 2012(2011/2012:EUR22,050,000).

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37. Contingentliabilitiesandotherobligations
Demag Cranes has contingent liabilities as follows asa result of giving guarantees (excluding product warranties):
31December 2012 Maximum potential future obligation 3,000 43,206 190 46,396 30September 2012 Maximum potential future obligation 117 42,688 42,805

inEURthousand Creditguarantees Notes Guaranteesconsistingof contingentliabilitiesrelatingtobuybackarrangements Other Total

Credit guarantees are guarantees given by Demag Cranes in favour of third parties creditors (guaranteestobanks). Contingent liabilities relating to notes represent the face value of notes issued that were not due or had not yet been honoured by the balance sheet date and which one or more Group companies are liabletohonourasendorsers. The guarantees consist of contingent liabilities relating to buyback arrangements entered into by Gottwald Port Technology GmbH in connection with sales of certain of its plant and machinery products.Thesearrangementsgenerallyhaveatermofonetosevenyears.Buybackobligationsand similar guarantees can result from the sale of products to customers or leasing companies. Under some of these contracts, Gottwald Port Technology GmbH must buy back machines from a leasing company if a lessee defaults on lease payments, does not exercise a purchase option or does not extend the lease at the end of the initial lease term. Under others, Gottwald Port Technology GmbH must compensate leasing companies for financial losses suffered through customers defaulting on payment. In certain instances where customers acquire products directly from Gottwald Port TechnologyGmbH,theexerciseofabuybackoptionbythecustomerissubjecttocertainconditions. Based on past experience and the regional distribution of installed cranes, the Management Board considers it a remote possibility that buyback options be exercised to a substantial extent at the same time. The maximum potential liability from buyback arrangements amounted to EUR 43,206,000at31December2012(30September2012:EUR42,688,000).

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38. Relatedparties Transactionswithrelatedparties


Demag Cranes AG and the subsidiaries included in the Consolidated Financial Statements transact business with numerous other companies, including in some cases with related parties. Related parties notably include the entities contained in the list of subsidiaries, joint ventures and investments, their subsidiaries, nonconsolidated subsidiaries of Demag Cranes AG, Terex Corporation,Westport,USAandallTerexaffiliates,plusemployeesinkeypositionswithintheGroup together with their families, and employees in key positions within Terex Corporation together with theirfamilies. The Groups main transactions with related parties arise in the course of normal business dealings. All such transactions are effected on an arms length basis. The table below provides information on transactionswithrelatedpartiesasat31December2012.
MHEDemag(S) Pte.Ltd.,Singapore andsubsidiaries TBAInternational HoldingB.V.,Delft,Netherlands Terex Corporation,Westport,Connecticut,USAandsubsidiaries jointventure SubsidiaryTBAB.V., Delft Interestandcontrol Supplierrelationships Loans Financial receivables Supplierrelationships Managementcharges Loans

The table below shows balances at the balance sheet date on transactions with the related parties mentionedandtheexpensesandrevenueincurredinthereportingperiod.
inEURthousand Receivables Trade receivablesfromTerex groupcompanies Trade receivables fromMHE Demag(S) Pte.Ltd. Receivablesfromloansgranted toTerex groupcompanies Advance paymentsmade toTerex groupcompanies Advance paymentsmade toMHEDemag(S) Pte.Ltd. Otherfinancial assets receivedfromTerex groupcompanies Otherfinancial assets receivedfromDonati Ltd. Liabilities Financial liabilitiespayable toTerex groupcompanies Trade payablestoTerex groupcompanies Trade payablestoMHEDemag(S) Pte.Ltd. Trade payablestoAQZ Trade payablestoGottwaldTBARomania Currentliabilitiespayable toTerex groupcompanies Liabilitiesfromadvance paymentsreceivedpayable toTerex groupcompanies Liabilitiesfromadvance paymentsreceivedpayable toMHEDemag(S) Pte.Ltd. 31December 2012 202,230 21,228 7,769 3,129 1,728 168,131 245 84,531 78,257 636 55 12 5,473 97 Ofwhich 30September interest 2012 78 17,835 75 3 782 782 6,239 7,441 3,192 716 247 5,573 297 69 12 31 5,163 1 Ofwhich interest 80 71 9 976 976

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inEURthousand Revenue DemagCranes&ComponentsCorp.,Cleveland(asat30June 2012) CranesAmericaServices,Corp.,Dayton(asat30June 2012) Otherentitiesofthe Terex group MHEDemag(S)Pte.Ltd. Donati Ltd. ShortFY2012 14,551 6,199 44 129 7,763 416 2011/2012 36,979 6,521 1,382 698 26,500 1,879

The sale of Demag Cranes & Components S.A.S, Chlons en Champagne; DCC France HoldCo SA, ChlonsenChampagne;DemagCranes&ComponentsS.A.U.,Madrid;DemagCranes&Components S.p.A.,AgrateBrianza;DonatiSollevamentiS.r.l.,Varese;andDemagCranes&ComponentsPty.Ltd., Smithfield on 14 December 2012 to the corresponding incountry Terex entities generated proceeds ofEUR83,748,000,whichresultedinaprofitofEUR62,357,000. Through the sale of the US entities to Terex USA, LLC, a Delaware limited liability company, on 29 June 2012, Demag Cranes generated revenue in financial year 2011/2012 totalling EUR 102,433,000, which resulted in a profit of EUR 57,205,000. Expenses of EUR 3,439,000 were recognised in the shortfinancialyear2012(financialyear2011/2012:EUR5,654,000)forintragrouptransferstoTerex Corporation,Westport,USA.

CompensationoftheManagementBoardandmembersoftheSupervisoryBoard
Information on the compensation system and compensation paid to individual members of the Management Board and Supervisory Board is provided in the Remuneration Report (in the Corporate governance section). The Remuneration Report forms an integral part of the combined ManagementReport. ManagementBoard MembersoftheManagementBoardwerepaidfixedandvariablecompensationintheshortfinancial year 2012. The variable compensation depends on the attainment of targets for operating EBIT and operating net income after tax. Noncash compensation is also provided in the amounts required to be recognised under tax regulations for the use of company cars. As in the previous year, the CompanyhasnotgrantedanyadvancesorcreditstomembersoftheManagementBoard. Totalcompensation ThetablebelowshowsthecompensationforactivemembersoftheManagementBoard.
inEURthousand Fixedcompensation Variable compensation Other Total ShortFY2012 275 233 148 656 2011/2012 1,399 616 415 2,430

The total compensation paid to active members of the Management Board was EUR 656,000 (2011/2012: EUR 2,430,000). This consisted of EUR 275,000 (2011/2012: EUR 1,399,000) in fixed

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compensation, EUR 233,000 (2011/2012: EUR 616,000) in variable compensation and EUR 148,000 (2011/2012:EUR415,000)inothercompensation. Oldageandsurvivingdependantspensions A pension expense of EUR 46,000 was recognised for Mr. Aloysius Rauen in the short financial year 2012 (2011/2012: EUR 138,000). The provision amounted to EUR 705,000 at 31 December 2012 (30 September2012:EUR622,000). Pension provisions for former members of the Management Board amounted to EUR 662,000 as at 31December2012(30September2012:EUR588,000). SupervisoryBoard In accordance with the Articles of Association, members of the Supervisory Board received fixed compensation totalling EUR 88,000 for the short financial year 2012 (2011/2012: EUR 348,000) for theiractivitiesontheSupervisoryBoardofDemagCranesAGandonthesupervisoryboardsofother Group companies. A further EUR 24,000 (2011/2012: EUR 181,000) was paid in attendance fees. There is no variable compensation for members of the Supervisory Board. As in the previous year, theCompanyhasnotgrantedanyadvancesorcreditstomembersoftheSupervisoryBoard. In addition, the employee representatives on the Supervisory Board who are employees of the Demag Cranes Group received salaries under their employment contracts. The amounts of these salaries represented appropriate compensation for the employees functions and tasks within the Group.

39. Personnelexpensesandnumberofemployees
The Group had an average of 5,410 employees in the short financial year 2012 (2011/2012: 5,995), comprising 2,541 bluecollar and 2,869 whitecollar employees (2011/2012: 2,891 and 3,104, respectively). The number of employees at 31 December 2012 was 5,108 (30 September 2012: 5,712). Personnel expenses amounted to EUR 89,848,000 in the short financial year 2012 (2011/2012:EUR380,177,000).

40. Corporategovernancecode
Since8March2013DemagCranesAGislistedintheEntryStandard(RegulatedUnofficialMarketon Frankfurter Wertpapierbrse) and therefore no longer listed according to Section 3 of the Stock Corporations Act (AktG). For this reason Demag Cranes AG is no longer obliged to publish a compliancestatementinaccordancewithSection161oftheGermanStockCorporationsAct.

41. ExemptionunderSection264(3)oftheGermanCommercialCode
The following subsidiaries made use of the exemption from disclosure and preparation of a management report under Section 264 (3) of the German Commercial Code (HGB) in the year under review:

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DemagCranes&ComponentsGmbH,Wetter,Germany DCCHoldCo4(vier)GmbH,Wetter,Germany DCCHoldCo5(fnf)GmbH,Wetter,Germany GottwaldPortTechnologyGmbH,Dsseldorf,Germany GottwaldHoldCo3(drei)GmbH,Dsseldorf,Germany KranserviceRheinbergGmbH,Rheinberg,Germany

42. Auditorsfees
Fees for services rendered by the auditors of the Consolidated Financial Statements, PricewaterhouseCoopers Aktiengesellschaft Wirtschaftsprfungsgesellschaft, Dsseldorf were recognised as expenses in the short financial year 2012 as follows: EUR 444,000 for the audit (2011/2012: EUR 612,000), of which EUR68,000 for the audit of the previous years financial statement, EUR 81,000 for auditrelated services (2011/2012: EUR 0,000) and EUR 0,000 for other services(2011/2012:EUR0,000).

43. Eventsafterthebalancesheetdate
On 14 January 2013, the Supervisory Board ofDemag Cranes AG nominated Stoyan (Steve) Filipov to the Management Board, in the position of Chief Operating Officer (COO). At the same time, he became President of the Terex Material Handling & Port Solutions business segment of Terex Corporation. Aloysius Rauen will resign as Chief Executive Officer of Demag Cranes AG in the course of this year when the integration of Demag Cranes into Terex Corporation has progressed further. Stoyan Filipov will then assume the title of CEO, Demag Cranes AG. Beginning with 14 January 2012, theheadsoftheMaterialHandlingandTerexPortSolutionssegmentswillreporttoStoyanFilipov.

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44. Subsidiaries,jointventuresandinvestmentsasat31December2012

Subsidiaries Companyandlocation orregisteredoffice DCC001 Kranservice RheinbergGmbH, Rheinberg DemagCranes&Components GmbH,Wetter(referredtoin the followingas"DCCGmbH") DemagCranes&Components A/S,Copenhagen DemagCranes&Components spol.s.r.o.,Slany DemagCranes&Components AG,Dietlikon DemagCranes&Components (Pty.) Ltd.,Johannesburg DemagCranes&Components Ltda.,Cotia DemagCranes&Components (India) Private Ltd.,Pune Verwaltungs2(zwei) GmbH, Wetter Interestandcontrol heldby Shareholding(%) DCCGmbH,Wetter DCCHoldCo5(fnf) GmbH,Wetter DCCGmbH,Wetter DCCGmbH,Wetter DCCGmbH,Wetter DCCGmbH,Wetter DCCGmbH,Wetter DCCGmbH,Wetter DCCGmbH,Wetter 100.0 Netincome Equity %ofcontrol inEURthousand inEURthousand 100.0

Countrycode DE

Remarks

7,900 Afterprofittransfer

DCC003 DCC004 DCC005 DCC006 DCC007 DCC008 DCC009 DCC011

DE DK CZ CH ZA BR IN DE

100.0 100.0 100.0 100.0 100.0 99.9999 100.0 100.0

100.0 100.0 100.0 100.0 100.0 99.9999 100.0 100.0

235 168 74 719 334 4,633 6

308,700 Afterprofittransfer 2,466 6,359 4,411 10,551 18,831 6,093 701

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Companyandlocation orregisteredoffice OOODemagCranes& ComponentsRussland, Moscow Donati (Shanghai) TradingCo. Ltd.,Shanghai DemagCranes&Components Unipessoal Lda.,Lisbon DemagCranes&Components Trading(Shanghai) Co.Ltd. DemagCranes&Components Trading(Shanghai) Co.Ltd., Pudong DemagCranes&Components (Middle East) FZE,Dubai DemagCranes&Components GmbH,Salzburg Interestandcontrol heldby Shareholding(%) 99.0 1.0 100.0 100.0 100.0 100.0 100.0 100.0 4 95 71 461 675 6,596 Netincome Equity in EUR thousand in EUR thousand %ofcontrol 100.0 105 686

Countrycode

Remarks

DCC013 DCC014 DCC015 DCC017

DCCGmbH,Wetter DCCVerwaltungs RUS GmbH,Wetter DemagCranes& CN ComponentsTrading PT CN DCCGmbH,Wetter DCCGmbH,Wetter

DCC018

CN

DCC022 DCC031

UAE AT

DCCGmbH,Wetter DemagCranes& Components HoldingsLtd.,Dubai DCCGmbH,Wetter

100.0

100.0

95

4,625

100.0 100.0

100.0 100.0

183 57

8,574 7,204

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Companyandlocation orregisteredoffice DCC032 DemagCranes&Components Guarantee Ltd.,Banbury Countrycode GB Interestandcontrol heldby Shareholding(%) DCCGmbH,Wetter DemagCranes& Components HoldingsLtd., Banbury DCCGmbH,Wetter DCCGmbH,Wetter 100.0 Netincome Equity %ofcontrol inEURthousand inEURthousand 100.0 95 Remarks

DCC033 DCC035 DCC036

DCC039

DCH002 DCH003 DCH005

DemagCranes&Components Ltd.,Banbury Sp.zo.o.,Warsaw DemagCranes&Components HoldingsLtd.,Dubai DemagWeihua(Liaoning), Material HandlingMachinery Co.Ltd.,Kaiyuan ArabianCranesandServices QatarLLC,Katar DCCHoldCo4(vier) GmbH, Wetter DCCHoldCo5(fnf) GmbH, Wetter DemagCranes&Components VerwaltungsGmbH,Wetter

GB PL UAE

100.0 100.0 100.0

100.0 100.0 100.0

239 70 4

12,640 3,791 2,959

CN Q DE DE DE

DCCGmbH,Wetter DCCGmbH,Wetter DemagCranesAG, Dsseldorf DCCHoldCo4(vier) GmbH,Wetter DCCGmbH,Wetter

51.0 49.0 100.0 100.0 100.0

51.0 49.0 100.0 100.0 100.0

78 0

6,232 35 108,039 203,247 22 Afterprofittransfer Afterprofittransfer

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Companyandlocation orregisteredoffice Countrycode Interestandcontrol heldby Shareholding(%) DCCGmbH,Wetter 74.0 DemagCranes& Components Guarantee Ltd., Banbury 26.0 GottwaldHoldCo3 (drei) GmbH, Dsseldorf 100.0 GottwaldPort TechnologyGmbH, Dsseldorf 100.0 TechnologyGmbH, 69.8 TechnologyGmbH, 100.0 TBAB.V.,Delft DemagCranesAG, Dsseldorf 76.0 100.0 Netincome Equity %ofcontrol inEURthousand inEURthousand 100.0 4,314 Remarks

DCH009

DemagCranes&Components HoldingsLtd.,Banbury GottwaldPortTechnology GmbH,Dsseldorf GottwaldPortTechnology VerwaltungsGmbH, Dsseldorf TBAB.V.,Delft NetherlandsB.V.,Spijkenisse DBIS(Software and Automation)Ltd.,Doncaster GottwaldHoldCo3(drei) GmbH,Dsseldorf

GB

GOC001

DE

100.0

55,448

Afterprofittransfer

GOC003 GOC005 GOC007 GOC009 GOH001

DE NL NL GB DE

100.0 69.8 100.0 76.0 100.0

0 479 10 306

25 4,951 640 1,008 14,401 Afterprofittransfer

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Jointventures Companyandlocation orregisteredoffice MHEDemag(S) Pte.Ltd., Singapore

Countrycode

Interestandcontrol heldby Shareholding(%)

Netincome Equity %ofcontrol inEURthousand inEURthousand

DCC010

SG

DCCGmbH,Wetter

50.0

50.0

1,030

Remarks Accountedforusingthe equitymethod:figures 24,247 asat30.November2012

Subsidiaries,jointventuresandinvestments Companyand locationorregisteredoffice AQZAusbildungsund Qualifizierungszentrum GmbH,Dsseldorf TBARomaniaS.r.l.,SatuMare

Countrycode

Interestandcontrol heldby Shareholding(%) GottwaldPort TechnologyGmbH, Dsseldorf TBAB.V.,Delft

Netincome Equity in EUR thousand in EUR thousand %ofcontrol

Remarks The company,having filedforbankruptcy,is

GOC004 GOC006

DE RO

30.0 100.0

30.0 100.0

n/a 3

n/a inliquidation 105

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45. Mandates SupervisoryBoard Dr.MichaelW.Ernestus,NewYork,NewYork,USA ChairmanoftheSupervisoryBoard G.C.AndersenPartner,LLC,NewYork,NewYork,USA(Partner) JosefBerger*,Dsseldorf,Germany DeputyChairmanoftheSupervisoryBoard(until29November2012) DemagCranes&ComponentsGmbH,Wetter(ChairmanoftheWorksCouncil) Membershipofothersupervisoryboards: DemagCranes&ComponentsGmbH,Wetter,Germany ReinhardMller*,Uslar,Germany DeputyChairmanoftheSupervisoryBoard(from30November2012) DemagCranes&ComponentsGmbH,Uslarplant,Germany(ChairmanoftheWorksCouncil) Membershipofothersupervisoryboards: DemagCranes&ComponentsGmbH,Wetter,Germany AxelJ.Arendt,Grnwald,Germany AxelArendtManagementConsultingGbR,Grnwald,Germany(ManagingDirector, executiveconsultant) Membershipofothersupervisoryboards: TognumAG,Friedrichshafen,Germany

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Membershipofothersupervisorybodies: BilfingerBergerIndustrialServicesGmbH,Munich,Germany(MemberoftheAdvisory Board) TitalGmbH,Bestwig,Germany(MemberoftheAdvisoryBoard) AerotechPeissenbergGmbH,Peissenberg(Germany)(MemberoftheAdvisoryBoard) KevinA.Barr,Wilton,Connecticut,USA TerexCorporation,Westport,Connecticut,USA(SeniorVicePresidentHumanResources) GerdUweBoguslawski*,Northeim,Germany FormerfirstauthorizedrepresentativeoftheGermanMetalworkersUnion(IGMetall)in southernLowerSaxony/Harz,Northeim,Germany Membershipofothersupervisoryboards: DemagCranes&ComponentsGmbH,Wetter,Germany SartoriusAG,Gttingen,Germany GiuseppeDiLisa*,Duisburg,Germany DemagCranesAG,Dsseldorf,Germany(SeniorVicePresidentGottwaldPortTechnology GmbH) HarryHansen*,MonheimamRhein,Germany GottwaldPortTechnologyGmbH,Dsseldorf(ChairmanoftheWorksCouncil) Membershipofothersupervisoryboards:

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GottwaldPortTechnologyGmbH,Dsseldorf,Germany BrianJ.Henry,Fairfield,Connecticut,USA TerexCorporation,Westport,Connecticut,USA(SeniorVicePresidentFinance&Business Development) Dr.MichaelLeue,Hamburg,Germany BryanCaveLLP,Hamburg,Germany(Partner) Membershipofothersupervisorybodies: initionsinnovativeITsolutionsAG,Hamburg,Germany(ChairmanoftheSupervisoryBoard) w2haAG,Hamburg,Germany(CharimanoftheSupervisoryBoard) trautmann,heumann,jochumundkemperag(ChairmanoftheSupervisoryBoard) HubertRosenthal*,Herdecke,Germany GermanMetalworkersUnion(IGMetall),Hagenadministrationoffice,Hagen,Germany(First authorizedrepresentative) Membershipofothersupervisoryboards: DemagCranes&ComponentsGmbH,Wetter,Germany GuHoldingGmbH,Osnabrck,Germany HoeschHohenlimburgGmbH,HagenHohenlimburg,Germany HoeschSchwerterProfileGmbH,Schwerte,Germany ThyssenKruppFedernundStabilisatorenGmbH,HagenHohenlimburg,Germany OrenG.Shaffer,Naples,Florida,USA ShafferandAssociates,Denver,Colorado,USA,

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(IndependentmanagementconsultantandPartner) Membershipofothersupervisorybodies: Intermec,Inc.,Everett,Washington,USA(MemberoftheBoardofDirectors) TerexCorporation,Westport,Connecticut,USA(MemberoftheBoardofDirectors) XPOLogistics,Inc.,Buchanan,Michigan,USA(MemberoftheBoardofDirectors) BelgacomSA,Brussels,Belgium(MemberoftheConseildadministration) *Employeerepresentative

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ManagementBoard AloysiusRauen,Munich,Germany MemberoftheManagementBoardandCEO Membershipofothersupervisoryboards: DemagCranes&ComponentsGmbH,Wetter,Germany(ChairmanoftheSupervisoryBoard) GottwaldPortTechnologyGmbH,Dsseldorf,Germany(ChairmanoftheSupervisoryBoard) Membershipofothersupervisorybodies: MHEDemag(S)Pte.Ltd.,Singapore,Singapore DemagWeihua(Liaoning)MaterialHandlingMachineryCo.,Ltd.,Kaiyuan,China(Chairman) CotesaGmbH,Mittweida,Germany(MemberoftheAdvisoryBoard) Stoyan(Steve)Filipov,Mamaroneck,NewYork,USA(since14January2013) MemberoftheManagementBoardandCOOofDemagCranesAG,Dsseldorf,Germany, andPresidentMaterialHandlingandPortSolutions,TerexCorporation,Westport,USA LawrenceJ.Lockwood,PeachtreeCorners,Georgia,USA MemberoftheManagementBoardandCFO

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Dsseldorf,25March2013

AloysiusRauen

StoyanFilipov

LawrenceLockwood

Responsibilitystatement
To the best of our knowledge, and in accordance with the applicable reporting principles, the Consolidated Financial Statements give a true and fair view of the assets, liabilities, financial position and profit or loss of the Group, and the Combined Management Report includes a fair review of the development and performance of the business and the position of the Group, together with a description of the material opportunities and risks associated with the expected development of the Group. Dsseldorf,25March2013

AloysiusRauen

StoyanFilipov

LawrenceLockwood

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Auditorsreport
We have audited the consolidated financial statements prepared by Demag Cranes AG, Dsseldorf, comprising the statement of comprehensive income, the statement of financial position, statement of changes in equity, cash flow statement and the notes to the consolidated financial statements, together with the group management report, which is combined with the management report of Demag Cranes AG, Dsseldorf, for the short financial year from 1October 2012 to 31December 2012. The preparation of the consolidated financial statements and the combined management report in accordance with the IFRSs, as adopted by the EU, and the additional requirements of German commercial law pursuant to (Article) 315a Abs. (paragraph) 1 HGB ("Handelsgesetzbuch": German Commercial Code) are the responsibility of the parent Company's Board of Managing Directors. Our responsibility is to express an opinion on the consolidated financial statements and thecombinedmanagementreportbasedonouraudit. We conducted our audit of the consolidated financial statements in accordance with 317 HGB and German generally accepted standards for the audit of financial statements promulgated by the Institut der Wirtschaftsprfer (Institute of Public Auditors in Germany) (IDW). Those standards require that we plan and perform the audit such that misstatements materially affecting the presentation of the net assets, financial position and results of operations in the consolidated financial statements in accordance with the applicable financial reporting framework and in the combined management report are detected with reasonable assurance. Knowledge of the business activities and the economic and legal environment of the Group and expectations as to possible misstatements are taken into account in the determination of audit procedures. The effectiveness of the accountingrelated internal control system and the evidence supporting the disclosures in the consolidated financial statements and the combined management report are examined primarily on a test basis within the framework of the audit. The audit includes assessing the annual financial statements of those entities included in consolidation, the determination of the entities to be included in consolidation, the accounting and consolidation principles used and significant estimates made by the Companys Board of Managing Directors, as well as evaluating the overall presentation oftheconsolidatedfinancialstatementsandthecombinedmanagementreport.Webelievethatour auditprovidesareasonablebasisforouropinion. Ouraudithasnotledtoanyreservations. In our opinion based on the findings of our audit the consolidated financial statements comply with theIFRSsasadoptedbytheEUandtheadditionalrequirementsofGermancommerciallawpursuant to 315a Abs. 1 HGB and give a true and fair view of the net assets, financial position and results of operations of the Group in accordance with these provisions. The combined management report is consistent with the consolidated financial statements and as a whole provides a suitable view of the Group'spositionandsuitablypresentstheopportunitiesandrisksoffuturedevelopment.

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Dsseldorf,25March2013 PricewaterhouseCoopers Aktiengesellschaft Wirtschaftsprfungsgesellschaft

BerndBoritzki Wirtschaftsprfer (GermanPublicAuditor)

ppa.RichardHindmarsh Wirtschaftsprfer (GermanPublicAuditor)

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FinancialCalendar2013
YouwillfindtheFinancialCalendarfor2013onourwebsiteatwww.demagcranesag.com SectionInvestorRelations

Publishersnote
Publisher: DemagCranesAG Forststrasse16 40597Dsseldorf Germany Postfach180343 40570Dsseldorf Phone+49(0)21171021202 Fax+49(0)211710251202 www.demagcranesag.com DesignandRealisation: DemagCranesAG PhotoCredits: DemagCranesAG

Print: Multiprintere.K.,NiehlerStrae89,50733Kln,Germany
ThisAnnualReportcontainsforwardlookingstatementsrelatingtothebusiness,financialperformanceandearningsofDemagCranesAGanditssubsidiariesandassociates. Forwardlooking statements are not historical facts and are indicated by words and phrases such as 'believe', 'expect', forecast', 'intend', 'project', 'plan', 'estimate', 'aim', 'anticipate', 'assume', 'target' and similar. Forwardlooking statements are based on current plans, estimates, projections and expectations and are thereforesubject to risks and uncertainties, most of which are difficult to estimate and which in general are beyond the control of Demag Cranes AG. Consequently, actual developments as well as actualearningsandperformancemaydiffermateriallyfromthatwhichisexplicitlyorimplicitlyassumedintheforwardlookingstatements. Demag Cranes AG gives no guarantee that expectations and targets explicitly or implicitly assumed in forwardlooking statements will be attained. Demag Cranes AG does not intend or accept any obligation to publish updates of these forwardlooking statements incorporating events or circumstances subsequent to publication of this Annual Report. All figures are rounded to the nearest thousand euros unless otherwise stated. The amount shown for each individual item and total is the figure with the smallest rounding difference.Reportedtotalsmaythereforedifferslightlyfromthesumoftheindividualreportedamounts. Pleasenotethat,inthecaseofalegaldispute,onlytheofficialGermanversionislegallybinding.TheEnglishversionisprovidedforinformationpurposesonly.

DemagCranesAG Forststrasse16 40597Dsseldorf Germany Phone+49(0)21171021202 Fax+49(0)211710251202 www.demagcranesag.com