artnet AG Quarterly Interim Statement for the First Quarter of 2016 artnet AG Quarterly Interim Statement for the First Quarter of 2016

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1 Quarterly Interim Statement for the First Quarter of 2016

2 Quarterly Interim Statement for the First Quarter of 2016 for Table of Contents General Information and Business Activities Economic Development of the Group Development of Segments Financial Status Opportunities and Risks Outlook artnet Authorities, Addresses, Investor Relations, artnet Stock (+36%). Revenue from the Price Database remained stable, while revenue from the Gallery Network fell 3% and the number of gallery memberships decreased, as compared to the same period last year. Due to targeted sales efforts, the number of gallery memberships increased in the first quarter of 2016, as compared to December 31, Revenue for artnet Auctions increased by 6% as compared to the first quarter of Gross profit from sales increased thanks to higher revenue and constant cost of sales (-1%) by 11% to 3.23 million USD, as compared to the first quarter of Operating expenses also decreased, as compared to the same General Information and Business Activities is a publicly traded corporation headquartered in Berlin, Germany. was incorporated under the laws of Germany in The address of its registered office is Oranienstraße 164, Berlin, Germany. holds 100% of the shares in ( Artnet Corp. ), which is located in New York, NY, USA. Artnet Corp. holds 100% of the shares in artnet UK Ltd. and artnet France Sarl. The Group s goal is to provide art collectors, galleries, publishers, auction houses, and art enthusiasts with a comprehensive suite of products that allows users to buy, sell, and research art online. The Price Database contains over 10 million auction records, allowing for in-depth art market research. Users can find artworks that are currently available for sale in the Gallery Network, Auction House Partnerships, or on artnet Auctions, an online transaction platform. artnet News, the 24-hour newswire, informs users about the events, trends, and people shaping the global art market. Economic Development of the Group Compared to the same period last year, artnet increased its revenue in the first quarter of 2016 by 291k USD (+6%) to 4.85 million USD, largely due to higher advertising revenue quarter in the previous year, mainly due to lower expenses for selling and marketing, as well as lower costs for product development. Because of higher revenues and lower expenses, the consolidated earnings increased sharply in what is typically a weak quarter, from -206k USD in the first quarter of 2015 to 287k USD in the first quarter of Development of Segments Following the general development of the Group as described above, the Contribution Margin II increased for all segments, as compared to the first quarter of The Contribution Margin II for the Galleries and Price Database segments increased slightly by 6% and 5%, respectively. Due to the large growth in advertising revenue, the Contribution Margin II for the artnet News segment increased by 68%, but remained negative. Higher revenue and lower expenses for product development and marketing allowed the artnet Auctions segment to turn a profit for the first time. Financial Status The financial status of the Group has not changed since the publication of the 2015 Annual Report. While artnet continued to reduce its liabilities mainly the accounts payable and other liabilities even further, the Group s operating cash flow was positive. Due to the redemption of a loan, the reduction of leasing liabilities, and investments made, cash

3 and cash equivalents increased only slightly as compared to December 31, 2015, even though artnet generated a positive consolidated net income. Opportunities and Risks Since the 2015 Annual Report was published on April 8, 2016, no significant events occurred that may affect the evaluation of future risks and opportunities for the Group. As described in the 2015 Annual Report, the going concern assumption for the Group is endangered by liquidity risks. Damages of 0.8 million EUR could be required on short notice, for the alleged copyright infringement of a French photographer, as determined by the French Court of Appeal. In March 2016, the French Court of Cassation decided in a pre-trial ruling to dismiss artnet s appeal against the judgment of the Court of Appeal, in favor of the motion of the French photographer based on procedural aspects of the case. Aside from all legal remedies, artnet continues its efforts to achieve a settlement with the photographer. artnet does not believe a full payment of damages will be required in Outlook According to the outlook published in the 2015 Annual Report, artnet is poised to continue its leadership position in a competitive market. Management expects the momentum of rising revenues, coupled with a moderate increase in expenses, to continue, and therefore do not alter its prognoses for the development of the segments in 2016, as made in the annual report Berlin, April 19, 2016 Jacob Pabst CEO,

4 Supervisory Board John Hushon, Chairman Hans Neuendorf, Deputy Chairman Piroschka Dossi Management Board artnet France sarl artnet UK Ltd. Addresses Investor Relations You can find information for investors and the annual financial statements at artnet.com/investor-relations. If you have further queries, please send an to or send your inquiry by mail to one of our offices. German Securities Code Number The common stock of is traded on the Prime Standard of the Frankfurt Stock Exchange under the symbol ART. You can find notices of relevant company developments at artnet.com/investor-relations. Wertpapier-Kenn-Nummer Oranienstraße Berlin T: +49 (0) F: +49 (0) [WKN] ISIN A1K037 DE000A1K Broadway, 26th Floor New York, NY USA T: F: artnet UK Ltd. Morrell House 98 Curtain Road London EC2A 3AF United Kingdom T: +44 (0) F: +44 (0) Concept and Production 2016, Berlin

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