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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
 
FORM 6-K
 
Report of Foreign Private Issuer
Pursuant to Rule 13a–16 or 15d–16 of
the Securities Exchange Act of 1934
Commission file number 001-14264
 
For the month of June 2006
 
PFEIFFER VACUUM TECHNOLOGY AG
(Translation of registrant’s name into English)
 
Berliner Strasse 43
D
35614 Asslar
Federal Republic of Germany

(Address of principal executive offices)
 
Indicate by check mark whether the registrant files or will file annual reports under cover of form 20-F or Form 40-F.
Form 20-F þ          Form 40-F o
 
Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S–T Rule 101(b) (1):
Yes o          No þ
Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S–T Rule 101(b) (7):
Yes o          No þ
Indicate by check mark whether by furnishing the information contained in this Form, the registrant is also thereby furnishing the information to the Commission pursuant to Rule 12g3–2(b) under the Securities Exchange Act of 1934.
Yes o          No þ
 
If “Yes” is marked, indicate below the file number assigned to the registrant in connection with Rule 12g3–2(b): 82–                    
 
 

 


 

Interim Report Second Quarter 2006
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Pfeiffer Vacuum Overview
                                                         
                                    Q1-Q2     Q1-Q2        
            Q2 2006     Q2 2005     Change     2006     2005     Change  
 
Results
                                                       
Total sales
    K       42,027       39,931       5.2 %     85,689       77,519       10.5 %
Germany
    K       9,870       10,944       (9.8 )%     21,697       20,479       5.9 %
Other countries
    K       32,157       28,987       10.9 %     63,992       57,040       12.2 %
Operating profit
    K       10,170       8,829       15.2 %     20,710       16,981       22.0 %
Net income
    K       6,277       5,370       16.9 %     12,684       10,298       23.2 %
Return on sales
    %       14. 9       13.4               14.8       13.3          
Operating cash flow
    K       6,134       6,275       (2.2 )%     11,381       9,477       20.1 %
Capital expenditures
    K       2,999       1,074       179.2 %     3,486       1,686       106.8 %
Earnings per share
          0.72       0.62       16.1 %     1.46       1.18       23.7 %
 
                                                       
Workforce
                                                       
Workforce (average )
            684       691       (1.0 )%     686       691       (0.7 )%
Germany
            504       508       (0.8 )%     506       508       (0.4 )%
Other countries
            180       183       (1.6 )%     180       183       (1.6 )%
Sales per employee
    K       61       58       5.2 %     125       112       11.6 %
                                 
            June 30, 2006     December 31, 2005     Change  
 
Balance sheet
                               
Total assets
    K       140,924       138,824       1.5 %
Cash and cash equivalents
    K       57,346       61,651       (7.0 )%
Number of shares issued
            8,837,650       8,790,600       0.5 %
Shareholders’ equity
    K       113,937       112,631       1.2 %
Equity ratio
    %       80.8       81.1        
Throughout this interim report, all percentages are calculated based on amounts in thousands .

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Pfeiffer Vacuum Share Performance
The shares of Pfeiffer Vacuum Technology AG have been traded in New York since July 16, 1996, and in Frankfurt since April 15, 1998.
             
 
    Deutsche Börse, Prime Standard, Frankfurt   Trading Symbol: PFV
 
           
 
    International Securities Identification Number:   ISIN DE0006916604
 
           
 
    Reuters Symbol:   PV.DE
 
           
 
    New York Stock Exchange (NYSE), New York   Trading Symbol: PV
 
           
 
    International Securities Identification Number:   ISIN US7170671025
 
           
 
    Number of shares issued    
 
      (including 122,076 treasury stock):   8,837,650 
 
           
 
    Free-float as of June 30, 2006:   100% 
 
           
 
    Market capitalization as of June 30, 2006:   437.2 million
On the stock exchange in Frankfurt, Pfeiffer Vacuum share performance virtually kept pace with the TecDAX development during the first six months of 2006. While the TecDAX advanced by 8.5% from 601 to 652 points, Pfeiffer Vacuum share prices increased by 5.8%. On January 2, 2006, the shares opened at 46.76 and closed at 49.47 on June 30, 2006. They reached their low for the period of 44.45 on January 17, 2006. The high for the period of 58.00 on May 12, 2006 was also the highest stock price ever recorded for Pfeiffer Vacuum shares.
The prices of Pfeiffer Vacuum ADRs on the NYSE, which are traded in U.S. dollars, reflect changes in the share price and changes in the exchange rate parity between the euro and the U.S. dollar over the course of the year 2006. The ADRs opened on January 3, 2006, at a price of US$54.82 and closed on June 30, 2006, at US$63.50. The highest price in the first six months was US$73.95 on May 10, 2006. The ADRs’ low for the period was US$53.81 on January 17, 2006.
As one of the highest dividend issuers in the TecDAX, Pfeiffer Vacuum distributed a dividend to its shareholders for the eighth year in a row in 2006 ( 1.35 per share for fiscal year 2005). Following a proposal of Management Board and Supervisory Board the Shareholders’ Meeting agreed to a total dividend of 11.7 million on May 31, 2006, up 50% from total prior year dividend of 7.8 million.

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The Pfeiffer Vacuum Group’s Business and Position
In the first six months of 2006, Pfeiffer Vacuum again increased its sales by 10.5% and its operating profit by 22.0% compared to the first half-year of 2005. Year on year, in fact, the second quarter of 2006 saw a sales rise by 2.1 million or 5.2%.
Overall Economic Environment and Industry Situation
Overall, the growth rate of world economy in 2006 is expected to be flat compared to the year 2005, but resulting from a very heterogeneous development in the continents. The growth rate in the Asian region (without Japan) will slightly decrease but still remain on a high level. The development in Europe is expected to be significantly higher than in the year before, especially caused by satisfactory growth rates in Italy, France and Germany. The growth rate in the United States is estimated to be down from the year 2005 but still exceed the development in Europe. Political situations in the near and middle east and potential impacts from rising world energy prices complicate the forecast for the 2006 development.
The competitive situation in the vacuum industry, coupled with heightened competitive pressure in the vacuum market remained on the level of 2005. Due to permanent enhancements and new developments of our products we were able to hold our technological leading, resulting in an increase of our business in 2006.
Business
Our business operations include the development, manufacture, sale and service of vacuum pumps, vacuum measurement, components and analysis equipment and instruments, as well as vacuum systems.
Sales
Presented below are net sales by segment, by region and by product for the periods ended June 30, 2006 and 2005. It should be noted with respect to net sales by segment that the sales shown in this presentation were allocated on the basis of the location that invoiced the sales. The segment-based presentation thus shows net sales by subsidiaries. Net sales by region, on the other hand, include all sales in a given region, regardless of which subsidiary within the Pfeiffer Vacuum Group actually invoiced the sales. Net sales by segment and by region can thus differ from one another to a greater or lesser extent. Net sales in the Asian segment, for example, differ from those shown for the Asian region, as the Asian segment includes only the sales of our two Asian subsidiaries in India and Korea. The presentation for the Asian region, on the other hand, additionally includes sales generated directly with Asian customers by the German company.

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The Pfeiffer Vacuum Group’s Business and Position
In net sales by segment, the sales of the German company generated through direct shipments to agents and/or customers outside Germany are significantly higher than German sales by region. Net sales in the U.S. region and the U.S. segment, on the other hand, are nearly identical, because virtually all sales in this region are handled by our American subsidiary.
Sales by Segment (Companies)
Pfeiffer Vacuum’s subsidiaries in the individual countries are independent legal entities with their own management which distribute the products and provide services. Accordingly, we identify our operating segments geographically. Due to the similarity of their economic characteristics, including nature of products sold, type of customers, method of product distribution and economic environment, we aggregate our European subsidiaries outside Germany into one reportable segment, “Europe (excluding Germany).”
Sales by Segment
                                 
    Three Months Ended     Six Months Ended  
    June 30,     June 30,  
K   2006     2005     2006     2005  
 
Net sales
                               
Germany
    18,110       17,645       37,319       33,527  
Europe (excluding Germany)
    12,373       12,277       24,922       25,541  
United States
    10,475       9,130       21,344       16,845  
Asia
    1,069       879       2,104       1,606  
 
Total
    42,027       39,931       85,689       77,519  
 
Analysis of these numbers shows that we were essentially able to increase sales in all geographical segments. Only in the segment Europe (excluding Germany) our sales decreased slightly in the first quarter of 2006 compared to 2005, but in the second quarter we were able to reach a small increase. During the first six months of 2006, the strongest growth was recorded in the segment United States, where sales totaled 21.3 million, up 4.5 million, or 26.7%, from the comparable period the year before. This sales increase was enhanced by approximately 0.9 million foreign exchange gains due to the strengthened U.S. dollar against the Euro. Expressed in U.S. dollars, the sales of our U.S. subsidiary rose by 21.1% to US$26.2 million.
In Germany, sales advanced by 3.8 million, or 11.3%, to a total of 37.3 million in the first six months 2006 compared to 2005. Germany thus continued to be the segment that accounted for the highest share of total sales (43.5%). Rigorous efforts aimed at winning new customers and expanding business with existing customers and new products enabled Pfeiffer Vacuum to go against the general economic trend in growing sales.

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The Pfeiffer Vacuum Group’s Business and Position
Sales by Region
To provide additional information, we are also presenting sales by region in the following table. It includes all sales in a given region, regardless of which company in the Pfeiffer Vacuum Group actually generated these sales.
Sales by Region
                                 
    Three Months Ended     Six Months Ended  
    June 30,     June 30,  
K   2006     2005     2006     2005  
 
Net sales
                               
Germany
    9,870       10,944       21,697       20,479  
Europe (excluding Germany)
    12,580       12,263       25,315       26,144  
United States
    10,466       9,059       21,209       16,724  
Asia
    8,364       7,194       16,522       13,319  
Rest of world
    747       471       946       853  
 
Total
    42,027       39,931       85,689       77,519  
 
In the six month period ended June 30, 2006, our sales to the United States increased by 4.5 million or 26.8% to 21.2 million. Sales to the Asian region increased by 3.2 million or 24.0% to 16.5 million, primarily due to sales increases in Japan and India. Additionally, we gain ground in China on a small level. Accounting for 29.5% of total sales, Europe (excluding Germany) continues to be our largest market. While in Europe (excluding Germany) in the first half-year a decrease by 3.2% to 25.3 million was recorded, in Germany the sales increased by 5.9% to 21.7 million and offset this adverse effect.
Sales by Product
Sales by Product
                                 
    Three Months Ended     Six Months Ended  
    June 30,     June 30,  
K   2006     2005     2006     2005  
 
Net sales
                               
Turbopumps
    18,509       17,033       38,162       31,536  
Measurement/analysis equipment, components
    9,861       10,247       21,874       20,711  
Service
    6,006       5,961       11,861       11,428  
Backing pumps
    5,675       5,499       11,185       10,540  
Systems
    1,976       1,191       2,607       3,304  
 
Total
    42,027       39,931       85,689       77,519  
 
Turbopumps have an overriding importance to us. During the first six months of 2006, this product line generated total sales of 38.2 million,

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The Pfeiffer Vacuum Group’s Business and Position
representing an increase by 6.6 million, or 21.0%, over the prior year. Turbopumps generated 44.5% of our total sales (2005: 40.7%). Sales of measurement/analysis equipment, components also developed positively, rising by 1.2 million, or 5.6%, to 21.9 million as per end of June 2006. Backing pump sales and service sales recorded a moderate increase by 0.6 million and 0.4 million, respectively. On the other hand, there was a small decline by 0.7 million in system sales.
Order Intake and Order Backlog
Our order intake increased from 83.0 million in the first six months of 2005 by 3.8 million to 86.8 million in 2006. Generally, the first quarter of 2006 developed extremely positive compared to 2005, while the second quarter of 2006 was flat to the previous years period. In the six month period ended June 30, 2006, new orders in turbopumps increased by
1.3 million, in backing pumps by 1.3 million and in service by 0.2 million, offset by 0.8 million decrease in system orders. At June 30, 2006, the book-to- bill ratio, the quotient of new orders and sales amounted to 101.3%.
Our order backlog decreased by 0.8 million, from 31.4 million at June 30, 2005 to 30.6 million at June 30, 2006. One reason is decreased order intake in systems within the second quarter and on the other hand fulfilled orders in turbo pumps.
Contracts are only recorded as orders when they are based upon binding contracts. The value of orders on hand should not be used to predict future sales and order volumes.
Cost of Sales and Gross Profit
The cost of sales incurred in the six months ended June 30, 2006, totaled 43.1 million. This represents an increase of 1.6 million over the 41.5 million for the comparable period the year before. In the second quarter our cost of sales increased slightly from 21.4 million in 2005 to 21.5 million in 2006. The increase in both periods is predominantly attributable to our significantly raised sales. Our gross profit improved from 36.1 million to 42.6 million in the first six months of 2006 and from 18.6 million to 20.5 million in the second quarter of 2006 compared to the prior year, respectively. Our gross margin (gross profit as percentage of sales) increased from 46.5% in the first half-year 2005 to 49.7% in the current year’s period. In the second quarter of 2006 we recorded an increase to 48.8% from 46.5% in 2005.
A favorable product mix, the economies of scale and our permanent cost management in the production aligned with keeping our commodity prices for e.g. cast iron, stainless steel and aluminum at a virtually constant level, enables us to leverage our cost of sales.

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The Pfeiffer Vacuum Group’s Business and Position
Selling and Marketing Expenses
Selling and marketing expenses totaled 11.5 million as of June 30, 2006 as opposed to 9.6 million for the corresponding period in the year before. Selling and marketing expenses increased by 1.9 million primarily as a result of various marketing measures, e. g. corporate image campaign, trade fair participations, advertisements and print of new brochures. Our goal is still to expand our market share and to withdraw the competitive price pressure. Relative to sales, the ratio increased from 12.4% in the first six months of 2005 to 13.4% in 2006.
General and Administrative Expenses
In the six month period ended June 30, 2006, general and administrative expenses totaled 6.9 million, up 0.8 million from the comparable prior year’s period ( 6.1 million). In the second quarter 2006 the general and administrative expenses turned back to normal level ( 3.1 million), while the first quarter of 2006 was burdened with expenses related to the adoption of SOA 404 at end of fiscal year 2006 and additional personnel cost. Relative to sales, the ratio for the first six months 2006 increased from 7.8% in 2005 to 8.1%.
Research and Development Expenses
Research and development expenses amounted to 3.4 million in both, the first half-year of 2006 and the first half-year of 2005. As a result of higher sales, however, the expense ratio declined in the same periods from 4.4% (2005) to 4.0% (2006). The research and development expenses increased in the second quarter of 2006 by 0.1 million compared to the same period in 2005. The ratio was 4.1% in both quarters.
We will maintain the percentage of expenses allocated for research and development at a high level. We are dependent upon maintaining our technological edge in designing and manufacturing vacuum pumps, and invest in order to be able to continue to sustain our position on the world market, to expand our market shares and to open up new markets. All expenditures for research and development are expensed as they are incurred.
Operating Profit
During the first six months of 2006, operating profit rose sharply from 17.0 million to 20.7 million, representing growth of 3.7 million or 22.0%. At 10.2 million, the Company’s operating profit in the second quarter of 2006 was also up sharply from 2005 ( 8.8 million).

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The Pfeiffer Vacuum Group’s Business and Position
The ratio between operating profit and sales totaled 24.2% for the first six months of the year 2006, up 2.3 percentage points year on year.
Financial Income
Financial income comprises interest expense, interest income and exchange rate gains or losses. As of June 30, 2006, financial income totaled 0.3 million, as opposed to 1.5 million for the comparable period in 2005. This decrease is primarily due to foreign exchange rate changes; in 2006 we recorded a loss of 0.4 million compared to a gain in 2005 of 1.0 million.
Income Taxes
The Company’s effective tax rate of its continuing operations was 39.0% for the first six months of 2006 and 39.8% for the first six months of 2005. The effective tax rate for the second quarter 2006 was 39.0% (2005: 39.8%).
The tax rate used for calculation of the income tax benefit from discontinued operations in 2005 was 37.9%.
Income from Continuing and Discontinued Operations and Net Income
Income from continuing operations totaled 12.7 million for the six month period ended June 30, 2006 compared to
11.1 million at June 30, 2005, representing an improvement of 1.6 million, or 14.1%. In the second quarter of 2006 income from continuing operations amounted to 6.3 million and increased by 0.5 million or 7.4% from the previous year’s amount ( 5.8 million).
In fiscal year 2005 we recorded losses from discontinued operations (see Note 9 “Discontinued operations” to the Interim Financial Statements). These discontinued operations resulted in the first six months of 2005 in a loss of 0.8 million (second quarter 2005: 0.5 million). The net income of 2006 was not burdened with any expenses due to these discontinued operations. Additionally, we do not expect any charges in future periods.
Net income in the six months ended June 30, 2006 was 12.7 million (2005: 10.3 million) and in the three month period ended June 30, 2006 6.3 million (2005: 5.4 million).

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The Pfeiffer Vacuum Group’s Business and Position
Financial Position
The financial position of the Pfeiffer Vacuum Group continues to be characterized by cash and cash equivalents on the assets side of the balance sheet and by shareholders’ equity on the opposite side. The balance sheet total on June 30, 2006, increased by 1.5%, or 2.1 million, compared to December 31, 2005. On the asset side, the increase in the balance sheet total was predominantly attributable to the 2.6 million increase in inventories to 16.4 million, as well as the 1.8 million increase in fixed assets. The cash flow statement shows the development of liquid assets.
Total shareholders’ equity increased by 1.3 million. One important reason is an increase in additional paid-in capital by 2.1 million primarily due to the conversion of convertible bonds and the recording of the conversion price ( 1.9 million), offset by share buy-back amounting to 1.0 million. The equity ratio decreased slightly from a high level of 81.1% in 2005 to 80.8% in 2006. The development of shareholders’ equity already includes the dividend payment totaling 11.7 million (2005: 7.8 million). Our higher-than-average shareholders’ equity continues to enable us to finance our investments and operations without having to resort to bank debt.
Cash Flow
Further on, we are able to generate required cash from operating activities to fund our day-to-day business and investment projects.
Cash flow from operating activities totaled 11.4 million for the first six months of 2006 and represents an increase of 1.9 million from the 9.5 million total for the comparable period in 2005. Compared to the first half-year 2005, our higher inventories led to an increased cash usage of approximately 2.0 million, offset by an increase in trade payables of approximately 0.7 million (cash provided). Additionally, the increase in net income had a positive effect of approximately 2.4 million on the cash flow provided by operating activities.
Net cash used in investing activities totaled 3.4 million for the period ended June 30, 2006 compared to 4.5 million cash provided by investing activities for the prior year’s period. In 2005 we purchased investment securities amounting to 3.0 million and received 9.0 million repayment of investment securities. Capital expenditures totaled 3.5 million in 2006, and included the purchase of factory halls built on our ground amounting to 1.9 million.

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The Pfeiffer Vacuum Group’s Business and Position
The cash used in financing activities was predominantly impacted by the dividend payment to our shareholders amounting to 11.7 million in 2006 compared to 7.8 million in 2005. A dividend of 1.35 per share for the year 2005 was approved at the Annual Shareholders’ Meeting in May 2006.
We distributed a total amount of 11,732,207.40 to our shareholders. Additionally, the purchase of treasury stock led to a cash usage amounting to 1.0 million. The cash received in connection with the conversion of convertible bonds totaled only 1.0 million because a part of the conversion price was granted as employee loans and was recorded as non-cash transaction (please refer to Note 4 “Stock-based Compensation — Adoption of FAS 123R” to Interim Financial Statements).
Workforce
As of June 30, 2006, the Company employed a workforce of 684 people, 504 of them in Germany and 180 in other countries.
Workforce
                                 
    Germany     Other Countries  
    June 30,  
    2006     2005     2006     2005  
 
Manufacturing and Service
    272       276       55       56  
Research and Development
    74       79              
Sales and Marketing
    100       99       96       96  
Administration
    58       54       29       31  
 
Total
    504       508       180       183  
 
After three employees as of June 30, 2005 no employees were engaged in discontinued operations on June 30, 2006.
Risk Report
During the first six months of the 2006 fiscal year, there were no changes in the risks as described in our Annual Report (Geschäftsbericht) and our Annual Report on Form 20-F for the year ended December 31, 2005. Both reports are available on our homepage at www.pfeiffer-vacuum.net.

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The Pfeiffer Vacuum Group’s Business and Position
Major Events in Fiscal 2006
Since the beginning of the 2006 fiscal year, there have not been any significant changes in the Company’s position or the industry environment.
Outlook
The forecast for the world economic growth in 2006 is still very low. We estimate that sales growth in the vacuum industry in 2006 will be the same as in the past fiscal year. Given our orders on hand and rising customer demand, we anticipate that our sales will grow faster than the market in 2006.
Nevertheless, we cannot exclude negative impacts — due to the US dollar exchange rate or significant increases in commodity prices — in the next few months.
Overall, we assume that along with constantly growing sales our profitability will remain in line with the last year or slightly improve.

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Interim Financial Statements
Consolidated Statements of Income (unaudited)
                                 
    Three months ended     Six months ended  
    June 30,     June 30,  
K   2006     2005     2006     2005  
 
Net sales
    42,027       39,931       85,689       77,519  
Cost of sales
    (21,522 )     (21,371 )     (43,121 )     (41,462 )
 
Gross profit
    20,505       18,560       42,568       36,057  
 
 
                               
Selling and marketing expenses
    (5,516 )     (5,065 )     (11,510 )     (9,619 )
General and administrative expenses
    (3,064 )     (3,042 )     (6,932 )     (6,057 )
Research and development expenses
    (1,755 )     (1,624 )     (3,416 )     (3,400 )
 
Operating profit
    10,170       8,829       20,710       16,981  
 
 
                               
Interest expense
    (2 )     (95 )     (74 )     (103 )
Interest income
    371       431       752       607  
Foreign exchange gain (loss)
    (126 )     552       (399 )     997  
 
Income from continuing operations before income taxes and minority interests
    10,413       9,717       20,989       18,482  
 
 
                               
Income taxes
    (4,062 )     (3,871 )     (8,186 )     (7,365 )
Minority interests
    (74 )           (119 )      
 
                               
 
Income from continuing operations, net of tax
    6,277       5,846       12,684       11,117  
 
 
                               
Loss from discontinued operations, net of tax
          (338 )           (681 )
Loss on disposals from discontinued operations, net of tax
          (138 )           (138 )
 
                               
 
Net income
    6,277       5,370       12,684       10,298  
 
 
                               
Earnings per ordinary share and ADR (in ):
                               
From continuing operations, basic
    0.72       0.67       1.46       1.28  
From discontinued operations, basic
          (0.05 )           (0.10 )
 
Total, basic
    0.72       0.62       1.46       1.18  
 
 
                               
From continuing operations, diluted
    0.72       0.67       1.45       1.28  
From discontinued operations, diluted
          (0.05 )           (0.10 )
 
Total, diluted
    0.72       0.62       1.45       1.18  
 
See accompanying notes to the interim financial statements.

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Interim Financial Statements
Consolidated Balance Sheets (unaudited)
                 
    June 30,     December 31,  
K   2006     2005  
 
Assets
               
Cash and cash equivalents
    57,346       61,651  
Trade accounts receivable
    22,242       22,481  
Other accounts receivable
    3,004       1,259  
Inventories
    16,353       13,747  
Investment securities
    3,000       3,000  
Prepaid expenses
    689       872  
Deferred tax assets
    972       1,124  
Other current assets
    239       334  
 
Total current assets
    103,845       104,468  
 
 
               
Intangible assets
    550       487  
Property, plant and equipment
    24,192       22,394  
Investment Securities
    6,000       6,000  
Deferred tax assets
    4,519       4,563  
Other assets
    1,818       912  
 
Total non-current assets
    37,079       34,356  
 
 
               
 
Total assets
    140,924       138,824  
 
 
               
Liabilities and shareholders’ equity
               
Trade accounts payable
    4,490       3,184  
Other payables
    3,603       2,659  
Accrued liabilities
    7,812       9,640  
Income tax liabilities
    3,969       3,938  
Customer deposits
    968       1,375  
 
Total current liabilities
    20,842       20,796  
 
 
               
Convertible bonds
    340       461  
Accrued pension
    5,151       4,382  
Minority interests
    654       554  
 
Total non-current liabilities
    6,145       5,397  
 
 
               
Shareholders’ equity
               
Share capital (13,459,350 no par value ordinary shares authorized, 8,837,650 issued and 8,715,574 outstanding at June 30, 2006 and 13,459,350 no par value ordinary shares authorized, 8,790,600 issued and 8,690,524 outstanding at December 31, 2005)
    22,624       22,504  
Additional paid-in capital
    4,949       2,821  
Retained earnings
    95,135       94,183  
Accumulated other comprehensive loss
    (5,298 )     (4,439 )
Treasury stock, at cost (122,076 ordinary shares at June 30, 2006 and 100,076 at December 31, 2005)
    (3,473 )     (2,438 )
 
Total shareholders’ equity
    113,937       112,631  
 
               
 
Total liabilities and shareholders’ equity
    140,924       138,824  
 
See accompanying notes to the interim financial statements.

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Interim Financial Statements
Consolidated Statements of Shareholders’ Equity (unaudited)
                                                                 
                              Accumulated Other              
                              Comprehensive Income/Loss            
                                      Cumula-     Unrea-            
                                      tive     lized            
              Addi-    
Re-
            trans-     gain/            
Total
              tional    
tained
    Minimum     lation     (loss)    
Trea-
   
share-
     
Share
    paid-in    
ear-
    pension     adjust-     on    
sury
   
holders’
K    
capital
    capital    
nings
    liability     ment     hedges    
stock
   
equity
 
Balance at
January 1, 2004
    22,504       2,821       73,713       (64 )     (2,049 )     550       (2,438 )     95,037  
Dividends paid
                (6,083 )                             (6,083 )
Net income
                11,626                               11,626  
Components of other comprehensive income — net of tax of 294 —
                      (100 )     (765 )     (360 )           (1,225 )
Total comprehensive income
                                              10,401  
Balance at December 31, 2004
    22,504       2,821       79,256       (164 )     (2,814 )     190       (2,438 )     99,355  
Dividends paid
                (7,821 )                             (7,821 )
Net income
                22,748                               22,748  
Components of other comprehensive income — net of tax of 2,429 —
                      (3,592 )     2,327       (386 )           (1,651 )
Total comprehensive income
                                              21,097  
Balance at December 31, 2005
    22,504       2,821       94,183       (3,756 )     (487 )     (196 )     (2,438 )     112,631  
Dividends paid
                (11,732 )                             (11,732 )
Compensation expenses convertible bonds
          232                                     232  
Bonds converted
    120       1,896                                     2,016  
Share buy back
                                        (1,035 )     (1,035 )
Net income
                12,684                               12,684  
Components of other comprehensive income — net of tax of (142) —
                            (1,092 )     233             (859 )
Total comprehensive income
                                              11,825  
Balance at
June 30, 2006
    22,624       4,949       95,135       (3,756 )     (1,579 )     37       (3,473 )     113,937  
See accompanying notes to the interim financial statements.

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Interim Financial Statements
Consolidated Statements of Cash Flows (unaudited)
                 
    Six months ended June 30,  
K   2006     2005  
 
Cash flow from operating activities:
               
Net income from continuing operations
    12,684       11,117  
Adjustments to reconcile net income to net cash provided by operating activities:
               
Depreciation and amortization
    1,552       1,644  
Gain on disposal of fixed assets
    (6 )     (11 )
Non-cash compensation expense (convertible bonds)
    232        
Other non-cash income and expenses
    272       170  
Changes in net cash from discontinued operations
          (614 )
Effects of changes in operating assets and liabilities:
               
Inventories
    (2,861 )     (814 )
Receivables and other assets
    (1,716 )     (1,554 )
Accrued pension liabilities
    815       506  
Accounts payable trade
    1,305       630  
Accrued and other liabilities, including income tax liabilities
    (896 )     (1,597 )
Net cash provided by operating activities
    11,381       9,477  
 
               
Cash flow from investing activities:
               
Proceeds from disposals of fixed assets
    55       37  
Proceeds from disposals of discontinued operations
          171  
Capital expenditures
    (3,486 )     (1,686 )
Purchase of investment securities
          (3,000 )
Repayment of investment securities
          9,000  
Net cash provided by (used in) investing activities
    (3,431 )     4,522  
 
               
Cash flow from financing activities:
               
Dividend payment
    (11,732 )     (7,821 )
Bonds converted
    1,037        
Purchase of treasury stock
    (1,035 )      
Net cash used in financing activities
    (11,730 )     (7,821 )
 
               
Effects of foreign exchange rate changes on cash and cash equivalents
    (525 )     1,007  
 
               
Net increase (decrease) in cash and cash equivalents
    (4,305 )     7,185  
 
               
Cash and cash equivalents at beginning of period
    61,651       44,986  
 
               
Cash and cash equivalents at end of period
    57,346       52,171  
 
               
Non-cash transactions:
               
Repayments of convertible bonds and employee loans and newly granted employee loans
    (859 )     (26 )
See accompanying notes to the interim financial statements.

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Notes to the Interim Financial Statements (unaudited)
1. The Company and Basis of Presentation
Pfeiffer Vacuum is a full-line manufacturer in the vacuum technology business offering solutions for a variety of customer applications relating to the generation, control and measurement of vacuum. The products developed and manufactured at the production facility in Asslar, Germany, include turbomolecular pumps, a range of backing pumps, such as rotary vane, Roots and dry pumps, complete pumping stations as well as customized vacuum systems, vacuum components and instruments.
Pfeiffer Vacuum distributes its products through a network of its own sales offices and subsidiaries as well as independent marketing agents. Moreover, there are service support centers in most major industrial locations throughout the world. The Company’s primary markets are located in Europe, the United States and Asia.
The Consolidated Financial Statements of Pfeiffer Vacuum Technology AG and its subsidiaries (“the Company” or “Pfeiffer Vacuum”) have been prepared in accordance with United States Generally Accepted Accounting Principles (U.S. GAAP). The interim financial statements reflect all adjustments (consisting only of normal recurring adjustments) which are necessary for a fair presentation of the financial position, results of operations and cash flows of the Company. For further information, please refer to the consolidated financial statements and footnotes thereto included in the Pfeiffer Vacuum Technology AG Annual Report (Geschäftsbericht) and the Annual Report on Form 20-F for the year ended December 31, 2005, both available at the Company’s homepage (www.pfeiffer-vacuum.net).
Pfeiffer Vacuum presents its Consolidated Financial Statements in euros ().
2. Summary of Significant Accounting Policies
Consolidation Principles
All companies which Pfeiffer Vacuum Technology AG directly or indirectly controls are consolidated. The Company is considered to control an entity if it either directly or indirectly holds a majority of the voting rights and can therefore exercise a controlling influence.
All material intercompany gains and losses, receivables, liabilities, revenues and expenses are eliminated as part of the consolidation process.

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Notes to the Interim Financial Statements (unaudited)
Use of Estimates
The preparation of the Consolidated Financial Statements requires management to make estimates and assumptions that affect the amounts of assets and liabilities on the date of the financial statements and the reported amounts of revenues and expenses during the reporting period that are reported in the financial statements and accompanying notes. These estimates and assumptions could differ from the actual results.
Components of Operating Expenses
Cost of sales include all expenses that are related to the sold product or service in a direct or indirect manner, for example, material consumption (including inbound freight charges), production related wages and salaries, purchasing and receiving costs, inspection costs, warehousing costs and certain service costs. Inventory excess and obsolescence charges are also recorded in cost of sales as well as warranty related expenses. Selling and marketing expenses mainly include wages and salaries, costs for marketing and advertising and costs related to trade fairs and conventions as well as other merchandising costs (including catalogs, brochures, etc.). General and administrative expenses predominantly include wages and salaries, allowance for doubtful accounts, audit and other general consulting fees and other costs that relate to the company as a whole.
Reclassifications
Certain prior-year amounts have been reclassified to provide comparability with the presentation of the current year financial statements.
Foreign Currency Translation
The financial statements of the Company’s foreign subsidiaries have been translated into euros () in accordance with Statement of Financial Accounting Standards (“SFAS”) No. 52, “Foreign Currency Translation”. The functional currency of all of the Company’s foreign subsidiaries is the applicable local currency in which that entity conducts its business. When translating foreign functional currency financial statements, year-end exchange rates are applied to the assets and liabilities, while average annual exchange rates are applied to income statement accounts. The resulting translation adjustments are recorded as accumulated other comprehensive income (loss).

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Notes to the Interim Financial Statements (unaudited)
3. New U.S. Legislation and Accounting Rules
As a result of the Company’s listing at New York Stock Exchange, it is subject not only to the provisions of German law (corporation, codetermination and capital market legislation) and of its own Articles of Association but also to the licensing requirements of the New York Stock Exchange. American capital market legislation — specifically the Sarbanes-Oxley Act and the rules and regulations of the Securities and Exchange Commission (“SEC”) — also apply to Pfeiffer Vacuum.
4. Stock-based Compensation — Adoption of SFAS 123R
The Company established a convertible bond arrangement also known as the employee participation program implemented on July 7, 2002 and running through 2007. The purpose of this employee participation program is to provide compensation and motivate the management and some key employees by providing them with an opportunity to share in the Company’s stock price development and to participate in the future growth of Pfeiffer Vacuum Technology AG and its subsidiaries.
In prior years, when stock option plans were not allowed under German law, the use of convertible bonds was common practice among German public companies. Pfeiffer Vacuum’s employee participation program utilizes convertible bonds in lieu of stock options. Under this program, the Company provides an employee a loan to purchase a Company-issued convertible bond. The loan and the nominal value of the convertible bond are equal to each other (and to what would be the exercise price in the case of a stock option), and the interest rate on the loan is equal to the interest rate on the convertible bond. Accordingly, there is no out-of-pocket cost to the Company or to the employee for either the loan or the convertible bond (as in the case of a stock option). The employee may then exercise her/his right to convert the bond to Company stock (equivalent to the exercise of a stock option) by repaying the loan to the Company for the nominal value of the convertible bond (which is equal to what would be the exercise price in the case of a stock option).
Within the scope of this employee participation program, on July 7, 2002, the Company issued 4,600 convertible bonds having an aggregate principal amount of 0.6 million to members of management and certain salaried employees of the Company in Germany and other countries.
The conversion feature entitles the bearer to convert each bond into 50 no-par ordinary shares of Pfeiffer Vacuum. The conversion price is based upon 110% of the average closing price on the Frankfurt Stock Exchange for the last ten trading days prior to issuance and was set at 42.86 per share and includes a nominal amount of 2.56 and an additional payment of 40.30.

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Notes to the Interim Financial Statements (unaudited)
There were 132,950 option shares, relating to the convertible bonds for the 2002 issue outstanding at June 30, 2006. Fair value at the date of grant was 10.35 per ordinary share option. Each holder of convertible bonds could convert up to 30% of such bonds to ordinary shares subsequent to the Annual Shareholders’ Meeting in 2004, up to 60% following the Annual Shareholders’ Meeting in 2005 and up to 100% following the Annual Shareholders’ Meeting in 2006. The final conversion date is December 9, 2007. Conversion is only possible during specific periods of time.
The convertible bonds bear interest at 6% p.a. and are redeemable at their principal amount on December 10, 2007, unless previously converted or called. The bonds may be called by the Company at their principal amount upon termination of employment. Employees were given the opportunity of financing the purchase of the convertible bonds through interest-bearing employee loans. These loans bear interest at the same fixed rate as the bonds, have identical terms, are classified as other non-current assets in the balance sheet and are repayable upon conversion of the bonds or if the bonds are called by the Company upon termination of employment.
There is a right of setoff for both, principal and interest between the loan and the bond. Employee loans granted under this program amounted to K 301 as of June 30, 2006.
Should the conversion right be exercised, interest on the converted convertible bonds shall cease to accrue at the day on which said conversion right was exercised. The shares of stock stemming from exercise of conversion rights shall participate in earnings from the beginning of the fiscal year in which said shares of stock were created through exercise of the conversion rights.
As of June 30, 2006, employees had forfeited 1,000 of these convertible bonds having an aggregate principal value of 128,000 and repaid the corresponding employee loans. The Company did not recognize any compensation expense for the stock-based compensation awards in the years 2005, 2004 and 2003.
The fair value of each option grant was estimated on the date of grant using the Black-Scholes option pricing model, with the following assumptions being used for grants issued in 2002. The risk-free interest rate was 4.5%; expected term 4 years; expected dividend yield of 1%; and expected volatility 30%. Expected volatility was based on historical volatility. The risk-free rate is based on the average interest rate of German government bonds. Expected term represents the period of time that options are expected to be outstanding.

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Notes to the Interim Financial Statements (unaudited)
A summary of option shares related to the convertible bonds of the 2002 issue is as follows:
Shares Related to the Convertible Bonds
                 
            Weighted Average  
    Number of     Exercise Price  
    Shares Outstanding     per Share  
 
Convertible shares outstanding January 1, 2005
    190,000       42.86  
Granted
           
Exercised
           
Forfeited
    (10,000 )     42.86  
Convertible shares outstanding December 31, 2005
    180,000       42.86  
Granted
           
Exercised
    (47,050 )     42.86  
Forfeited
           
Convertible shares outstanding June 30, 2006
    132,950       42.86  
132,950 option shares of this program were exercisable at June 30, 2006 and are non-vested. In December 2004 the Financial Accounting Standards Board (“FASB”) issued SFAS 123 (revised 2004), “Share-Based Payments” (“SFAS 123R”). At January 1, 2006, the Company adopted SFAS 123R, using the modified-prospective transition method. Pfeiffer Vacuum has a fixed plan (under the convertible debt arrangement) with the number of shares fixed at 230,000 and the exercise price fixed at 42.86. The exercise price was greater than the quoted market price of the stock as it was based on 110% of the ten day average traded stock prior to the grant date plus 2.56 ( 128 face value of each bond divided by 50 shares).
All participants were employees within the consolidated Pfeiffer Vacuum Group as defined under common law. There have been no program modifications to date.
In the first six months of the fiscal year 2006, the Company recognized K 232 of total compensation costs, as the four year vesting period ends in June 2006. In the cash flow statement these expenses are disclosed in a separate line.
Under German tax law, expense related to share-based payment arrangements or specifically expense related to the intrinsic value of an instrument on a specified date is not tax deductible. Consequently, there were no deferred taxes recorded as part of SFAS 123R adoption.
In the conversion period in June 2006, the bearers of the bonds converted 941 bonds into 47,050 new no-par value ordinary shares of the Company. As a result of the conversion the share capital increased by 120,448 and the additional paid-in capital increased by 1,896,115.

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Notes to the Interim Financial Statements (unaudited)
The employees were given the opportunity to finance the conversion of the bonds through interest bearing loans. These loans bear interest of 6% per annum and can be redeemed by the employee at any time and mature on September 30, 2006. As of June 30, 2006 these loans amounted to K 859; as of July 27, 2006 they were reduced to K 11.
Wihtin the scope of this conversion, Manfred Bender, Chief Financial Officer of Pfeiffer Vacuum, converted 100 convertible bonds into 5,000 no-par value shares of the Company and sold these shares in June 2006. He did not access any loan from the Company. The announcement required by § 15a Wertpapierhandels-gesetz (German Securities Trade Act) was duly published.
5. Supervisory Board
The term of office of all members of the Supervisory Board ended upon the adjournment of the Annual Shareholders’ Meeting on May 31, 2006. Pursuant to §§ 96, Sub-para. 1, § 101, Sub-para. 1, German Stock Corporation Act, § 4, German One-Third Participation Act (“DrittelbG”) of 2004 and § 9, Sub-para. 1, Articles of Association and Bylaws, the Supervisory Board shall comprise four members elected by the Annual Shareholders’ Meeting and two members elected by the Company’s employees.
The following individuals were elected to the Supervisory Board as shareholder-elected members of the Supervisory Board:
Dr. Michael Oltmanns, Chairman of the Supervisory Board, Weinstadt-Schnaidt, Germany, Attorney at law and tax advisor, Menold Bezler Law Offices, Stuttgart,
Götz Timmerbeil, Vice Chairman of the Supervisory Board and Chairman of the Audit Committee and Financial Expert, Gummersbach, Germany, Managing shareholder of Timmerbeil GmbH Wirtschaftsprüfungsgesellschaft, Gummersbach,
Michael J. Anderson, New York, NY, U.S.A., Investment banker, Banc of America Securities, New York,
Wilfried Glaum, Hüttenberg, Germany, Business administrator and retired (2003) Chief Financial Officer of Pfeiffer Vacuum Technology AG.
The following individuals were elected to the Supervisory Board as employee-elected members of the Supervisory Board on May, 10, 2006 in accordance with German One-Third Participation Act (“DrittelbG”):
Helmut Bernhardt, Wetzlar, Germany, Employee representative,
Manfred Gath, Solms, Germany, Employee representative.

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Notes to the Interim Financial Statements (unaudited)
6. Senior Officer (Prokuristin)
Nathalie Benedikt (age 30), who graduated with a degree in business economics (Dipl.-Betriebswirtin) from Berufsakademie Mannheim, joined the Company in 2000. She is responsible for the Finance and Controlling Department. In July 2006 the Management Board granted Mrs. Benedikt a special power of attorney (Prokura), which grants her the authority to bind the Company with any member of the Management Board. Prior to 2000, she served as accountant for Zürich Versicherungs-AG, Direktion für Deutschland, a multinational insurance group.
7. Independent Auditor
At the Annual General Meeting of the Shareholders on May 31, 2006, the Supervisory Board proposed and the Shareholders elected Ernst & Young AG, Wirtschaftsprüfungsgesellschaft/Steuerberatungsgesellschaft, Eschborn, Germany, as the independent auditor of both the accounts of the Company and the consolidated accounts for the 2006 fiscal year.
8. Treasury Stock
At the Annual Shareholders’ Meeting on May 31, 2006, the Shareholders authorized Pfeiffer Vacuum to acquire treasury stock of the Company pursuant to § 71, Sub-para. 1, No. 8, German Stock Corporation Act. The Company is authorized to acquire treasury stock representing up to 2,250,393.60 of the capital stock (879,060 shares equal to 10% of capital stock at time of resolution) through November 31, 2007. At June 30, 2006, treasury stock totaling approximately 3.5 million was repurchased and consists of 122,076 ordinary shares valued at cost. Thereof 22,000 shares were repurchased within the scope of the new authorization and 100,076 shares in prior years.
9. Discontinued Operations
In spring 2005, the Management Board committed to a plan to dispose of the DVD business, having obtained Supervisory Board approval as required in order to terminate this sideline activity. Beginning in 2005, the DVD business as part of the segment Germany is reflected as a discontinued operation. All prior period statements have been restated accordingly.

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Notes to the Interim Financial Statements (unaudited)
Gains and losses of discontinued operations were as follows:
Gains and Losses
                                 
    Three months ended     Six months ended  
    June 30,     June 30,  
K   2006     2005     2006     2005  
 
Loss from operations of DVD business before income tax benefit
          (545 )           (1,097 )
Income tax benefit
          207             416  
Net loss from operations of DVD business
          (338 )           (681 )
 
                               
Loss on disposal before income tax benefit
          (222 )           (222 )
Income tax benefit
          84             84  
Net loss on disposal
          (138 )           (138 )
 
                               
Total loss from discontinued operations before income tax benefit
          (767 )           (1,319 )
Income tax benefit
          291             500  
Net total loss from discontinued operations
          (476 )           (819 )
The Company expects no future expenses due to these discontinued operations.
On June 30, 2006 and December 31, 2005 no assets or liabilities from discontinued operations were existent.
10. Inventories
Inventories consist of the following:
Inventories
                 
    June 30,     December 31,  
K   2006     2005  
 
Raw materials
    5,633       5,441  
Work-in-process
    5,631       3,989  
Finished products
    8,521       7,773  
Reserves
    (3,432 )     (3,456 )
Total inventories
    16,353       13,747  
Due to significant higher sales orders it was necessary to increase the inventories to hold the required delivery periods. Inventories are stated at the lower of cost or market.

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Notes to the Interim Financial Statements (unaudited)
11. Investment Securities
The Company holds investment securities amounting to 9.0 million, which will be held until final maturity and are consequently valued at carrying cost of acquisition. Compared to December 31, 2005, there were no changes in the first half-year of 2006.
12. Earnings per Ordinary and Diluted Share and ADR
The following table sets forth the computation of basic and diluted earnings per share and ADR:
Earnings per Ordinary and Diluted Share and ADR
                                 
    Three months ended     Six months ended  
    June 30,     June 30,  
    2006     2005     2006     2005  
Numerator:
                               
Income from continuing operations (in thousands )
    6,277       5,846       12,684       11,117  
 
                               
Denominator:
                               
Denominator for basic earnings per share — weighted-average shares
    8,698,203       8,690,524       8,694,363       8,690,524  
 
                               
Effect of dilutive securities:
                               
Convertible bonds
    30,052             26,706        
 
                               
Denominator for diluted earnings per share — adjusted weighted average shares and assumed conversions
    8,728,255       8,690,524       8,721,069       8,690,524  
 
                               
Earnings per share and ADR from continuing operations (in ):
                               
Basic
    0.72       0.67       1.46       1.28  
Diluted
    0.72       0.67       1.45       1.28  
13. Pension Benefits and Similar Obligations
Most employees of the Company are entitled to receive pension benefits from Pfeiffer Vacuum, which are covered by defined benefit plans. Plan assets for the German Pension Plans are held in the Pfeiffer Vacuum Trust e. V. (“the Trust”), a registered association. It is an independent, bankruptcy-protected, separate legal entity whose sole purpose is to act in a fiduciary capacity as trustee for the assets held. The trust has invested this cash in a mutual fund managed by an unrelated third party that pursues a target allocation of 30 % in equities and 70 % in fixed-income securities and cash.

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Notes to the Interim Financial Statements (unaudited)
Pension expense for all plans included the following components:
Pension Expense for All Plans
                                 
    Three months ended     Six months ended  
    June 30,     June 30,  
K   2006     2005     2006     2005  
 
Service cost
    294       252       589       502  
Interest cost
    555       551       1,112       1,101  
Expected return on assets
    (472 )     (545 )     (945 )     (1,089 )
Amortization of
                               
unrecognized net actuarial (gains) losses
    148       38       297       76  
unrecognized prior service cost
    17       18       34       37  
unrecognized net obligation
    6       6       12       12  
Net pension cost
    548       320       1,099       639  
The increase in pension expense is predominantly due to lower expected returns on assets and higher amortization for actuarial losses. Both factors are caused by the decreased interest rate level in fiscal 2005.
14. Warranty
Warranty accruals are established in the period the related revenue is recognized. The estimate is based on managements’ estimate and historical experience by specific product type.
Warranty provisions developed as follows:
Warranty Provisions
                 
    June 30,  
K   2006     2005  
 
Balance at beginning of period
    2,887       2,897  
Warranties issued during the period
    203       1,285  
Utilization of accruals
    (262 )     (167 )
Balance at end of period
    2,828       4,015  
15. Segment Information
The Company’s business activities include the development, manufacture, sale and service of vacuum pumps, vacuum components and instruments, as well as vacuum systems. The subsidiaries in the individual countries are independent legal entities with their own management which distribute the products and provide services. Accordingly, the Company identifies its operating segments geographically.

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Notes to the Interim Financial Statements (unaudited)
Due to the similarity of their economic characteristics, including nature of products sold, type of customers, method of product distribution and economic environment, the Company aggregates its European subsidiaries outside Germany into one reportable segment, “Europe (excluding Germany).” The Company evaluates the success and performance of its subsidiaries on the basis of their income before income tax.
Information concerning the Company’s continuing operations by geographic locations is summarized as follows:
Continuing Operations by Geographic Locations
                                 
    Three months ended     Six months ended  
    June 30,     June 30,  
K   2006     2005     2006     2005  
 
Net sales
                               
Germany
                               
Unaffiliated
    18,110       17,645       37,319       33,527  
Intercompany
    15,309       13,999       31,777       27,537  
 
    33,419       31,644       69,096       61,064  
Europe (excluding Germany)
    12,376       12,287       24,931       25,586  
United States
    10,514       9,132       21,337       16,850  
Asia
    1,310       1,303       2,593       2,189  
 
    57,619       54,366       117,957       105,689  
Intercompany eliminations
    (15,592 )     (14,435 )     (32,268 )     (28,170 )
 
                               
Total
    42,027       39,931       85,689       77,519  
 
                               
Net cost of sales
                               
Germany
    (18,286 )     (19,182 )     (37,685 )     (36,026 )
Europe (excluding Germany)
    (9,670 )     (9,361 )     (19,242 )     (20,002 )
United States
    (8,335 )     (6,679 )     (16,893 )     (12,621 )
Asia
    (737 )     (636 )     (1,491 )     (1,134 )
 
    (37,028 )     (35,858 )     (75,311 )     (69,783 )
Intercompany eliminations
    15,506       14,487       32,190       28,321  
 
                               
Total
    (21,522 )     (21,371 )     (43,121 )     (41,462 )
 
                               
Operating profit
                               
Germany
    8,716       6,633       17,338       13,318  
Europe (excluding Germany)
    613       914       1,709       1,818  
United States
    635       877       1,243       1,193  
Asia
    292       353       498       501  
 
    10,256       8,777       20,788       16,830  
Intercompany eliminations
    (86 )     52       (78 )     151  
 
                               
Total
    10,170       8,829       20,710       16,981  

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Notes to the Interim Financial Statements (unaudited)
16. Income Tax Expense
Under German corporate tax law, taxes on income are composed of corporate taxes, trade taxes and an additional surtax.
The Company’s effective tax rate of its continuing operations was 39.0% for the first six months of 2006 and 39.8% for the first six months of 2005.
The effective tax rate for the second quarter 2006 was 39.0% (2005: 39.8%).
The tax rate used for calculation of the income tax benefit from discontinued operations in 2005 was 37.9%.

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Signatures
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.
August 2, 2006
 
PFEIFFER VACUUM TECHNOLOGY AG
 
By: /s/ Wolfgang Dondorf
 
 
 Wolfgang Dondorf
Chief Executive Officer
 
 
By: /s/ Manfred Bender
 
 
 Manfred Bender
Chief Financial Officer

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Additional Information
Financial Calendar 2006
    3rd Quarter 2006 (9-Months) Results
Tuesday, November 7, 2006
Contacts
Investor Relations
Gudrun Geissler
Berliner Strasse 43
35614 Asslar
Germany
Phone: +49 (0) 6441 802-314
Fax: +49 (0) 6441 802-365
Gudrun.Geissler@pfeiffer-vacuum.de
www.pfeiffer-vacuum.net
Public Relations
Sabine Trylat
Berliner Strasse 43
35614 Asslar
Germany
Phone: +49 (0) 6441 802-169
Fax: +49 (0) 6441 802-883
Sabine.Trylat@pfeiffer-vacuum.de
www.pfeiffer-vacuum.net

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