----

|  ̈ | REGISTRATION STATEMENT PURSUANT TO SECTION 12(b) OR (g) OF THE SECURITIES |   |
|--------|--------------------------------------------------------------------------------|--------|
|   | EXCHANGE ACT OF 1934                                                           |   |
|   | or                                                                             |   |
| x      | ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE  |   |
|   | ACT OF 1934 FOR THE FISCAL YEAR ENDED DECEMBER 31, 2010              |   |
|   | or                                                                             |   |
|  ̈ | TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES       |   |
|   | EXCHANGE ACT OF 1934                                                           |   |
|   | or                                                                             |   |
|  ̈ | SHELL COMPANY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES    |   |
|   | EXCHANGE ACT OF 1934                                                           |   |

| American Depositary Shares, each representingone-fourth of one ordinary share | New York Stock Exchange |
|-------------------------------------------------------------------------------|-------------------------|
| Ordinary Shares                                                               | New York Stock Exchange |

| Ordinary SharesAmerican Depositary Shares | 28,220,041112,880,164 |
|-------------------------------------------|-----------------------|

| Large accelerated filer  ̈ | Accelerated filer  ̈   | Non-accelerated filer x |
|--------------------------------|--------------------------------------|-------------------------|

| U.S. GAAP x | International Financial Reporting Standards  ̈        | Other  ̈ |
|------------------|-----------------------------------------------------------|--------------|
|             | as issued by the International Accounting Standards Board |

----

| References                                                               | 1   |
|--------------------------------------------------------------------------|-----|
| Special Note Regarding Forward-Looking Statements                        | 2   |
| Presentation of Financial and Other Information                          | 4   |
| PART I                                                                   | 5   |
| Item 1. Identity of Directors, Senior Management and Advisers            | 5   |
| Item 2. Offer Statistics and Expected Timetable                          | 5   |
| Item 3. Key Information                                                  | 5   |
| Selected Financial Data                                                  | 5   |
| Exchange Rates                                                           | 9   |
| Risk Factors                                                             | 10  |
| Item 4. Information on the Company                                       | 46  |
| Overview                                                                 | 46  |
| History of the Elster Group                                              | 46  |
| Our Corporate Structure                                                  | 47  |
| Transactions Relating to Our Share Capital                               | 48  |
| Business overview                                                        | 51  |
| Our Strengths                                                            | 52  |
| Our Strategy                                                             | 54  |
| The Meter as the Gateway to the Smart Grid                               | 55  |
| The Smart Grid as Enabled by Elster EnergyAxis                           | 58  |
| Our Gas Products and Solutions                                           | 61  |
| Our Electricity Products and Solutions                                   | 63  |
| Our Water Products and Solutions                                         | 64  |
| Marketing, Sales and Distribution and Project Management                 | 65  |
| Procurement and Scalable Manufacturing Footprint                         | 67  |
| Intellectual Property, Patents and Licenses                              | 70  |
| IT Infrastructure                                                        | 71  |
| Insurance                                                                | 71  |
| Sales in Sanctioned Countries                                            | 71  |
| Real Property                                                            | 73  |
| Significant Subsidiaries                                                 | 74  |
| Regulation and Supervision                                               | 74  |
| Item 4 A. Unresolved staff comments                                      | 80  |
| Item 5. Operating and Financial Review and Prospects                     | 80  |
| Executive Summary                                                        | 81  |
| Key Factors Affecting Our Revenues and Expenses                          | 83  |
| Results of Operations                                                    | 85  |
| Historical Factors Affecting Our Recent Results                          | 104 |
| Special Note Regarding Non-GAAP Financial Measures                       | 110 |
| Liquidity and Capital Resources                                          | 115 |
| Contractual Obligations                                                  | 118 |
| Off-Balance Sheet Transactions                                           | 118 |
| Senior Facilities Agreement                                              | 118 |
|        Research and Development  | 124 |
| Projects and Backlog                                                     | 124 |
| Critical Accounting Policies                                             | 125 |
| Item 6. Directors, Senior Management and Employees                       | 131 |
| Overview of Our Corporate Governance Structure                           | 131 |
| German Corporate Governance Code                                         | 133 |
| Employee Involvement                                                     | 133 |
| General Meeting of Shareholders                                          | 134 |
| Administrative Board                                                     | 134 |
| Committees of the Administrative Board                                   | 138 |
| Managing Directors                                                       | 140 |
| Compensation and Share Ownership                                         | 143 |
| Employees and Labor Relations                                            | 148 |
| Employee Incentive Plans                                                 | 148 |

----

| Item 7. Major Shareholders and Related Party Transactions                             | 149 |
|---------------------------------------------------------------------------------------|-----|
| Item 8. Financial Information                                                         | 156 |
| Item 9. The Offer and Listing                                                         | 157 |
| Item 10. Additional Information                                                       | 158 |
| Item 11. Quantitative and Qualitative Disclosures About Market Risk                   | 170 |
| Item 12. Description of Securities Other than Equity Securities                       | 173 |
| PART II                                                                               | 176 |
| Item 13. Defaults, Dividend Arrearages and Delinquencies                              | 176 |
| Item 14. Material Modifications to the Rights of Security Holders and Use of Proceeds | 176 |
| Item 15. Controls and Procedures                                                      | 177 |
| Item 16A. Audit committee financial expert                                            | 178 |
| Item 16B. Code of Ethics                                                              | 178 |
| Item 16C. Principal Accountant Fees and Services.                                     | 178 |
| Item 16D. Exemptions from the Listing Standards for Audit Committees                  | 179 |
| Item 16E. Purchases of Equity Securities by the Issuer and Affiliated Purchasers      | 179 |
| Item 16F. Change in Registrant’s Certifying Accountant                          | 180 |
| Item 16G. Corporate Governance                                                        | 180 |
| PART III                                                                              | 182 |
| Item 17. Financial Statements                                                         | 182 |
| Item 18. Financial Statements                                                         | 182 |
| Item 19. Exhibits                                                                     | 182 |
| Signatures                                                                            | 184 |
| Index to Financial Statements                                                         | F-1 |

----

|   | · | "we," "us," "our company," "our group" and "Elster" refer to Elster Group SE (formerly known as Elster Group S.A.) and, unless the context otherwise requires, to our subsidiaries; |
|--------|--------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | "Rembrandt" refers to Rembrandt Holdings S.A., a Luxembourg stock corporation; and |
|--------|--------|-----------------------------------------------------------------------------------------|

|   | · | "Management KG" refers to Nachtwache Metering Management Vermögensverwaltungs GmbH & Co. KG, a limited partnership organized under German law. |
|--------|--------|--------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

|   | · | the market for products and services and by region; |
|--------|--------|-----------------------------------------------------|

|   | · | the expected penetration rates of Smart Grid technologies in existing and new markets; |
|--------|--------|----------------------------------------------------------------------------------------|

|   | · | plans, objectives and expectations relating to future operations and related revenue generation and expenditures; |
|--------|--------|-------------------------------------------------------------------------------------------------------------------|

|   | · | the impact of our cost-saving measures and exchange rate fluctuations; and |
|--------|--------|---------------------------------------------------------------------------------|

|   | · | impacts of existing and potential legislative and regulatory initiatives. |
|--------|--------|---------------------------------------------------------------------------|

|   | · | negative worldwide economic conditions and ongoing instability and volatility in the worldwide financial markets, including our ability to raise capital to refinance our indebtedness; |
|--------|--------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | the extent of the revenues we derive from sales to the utility industry; |
|--------|--------|--------------------------------------------------------------------------|

|   | · | possible changes in current and proposed legislation, regulations and governmental policies, including with respect to radio frequency licensing and certification requirements; |
|--------|--------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | the timing and availability to our customers of government stimulus funding; |
|--------|--------|------------------------------------------------------------------------------|

|   | · | volatility in the prices for, and availability of, components, raw materials and energy used in our business; |
|--------|--------|---------------------------------------------------------------------------------------------------------------|

|   | · | our ability to manage our outsourcing arrangements; |
|--------|--------|-----------------------------------------------------|

|   | · | the economic, political and other risks and uncertainties associated with our global activities, and the business our subsidiaries have undertaken, and may continue to undertake, in countries subject to EU or U.S. sanctions and embargoes; |
|--------|--------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | the dependency of our business on our ability to develop new products and technologies and the possible failure or delay in successful new product development; |
|--------|--------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

|   | · | the possibility that our products would fail to achieve or lose market acceptance or fail to perform to specification, the increasing competition we face, particularly from competitors that are well positioned in our areas of strategic focus, and our ability to win regional, national and international contracts from existing or new customers; |
|--------|--------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | our ability to attract and retain employees with skills in our areas of focus, including in particular our skilled personnel who are critical to the success of our business; |
|--------|--------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | fluctuations of our operating results due to the effect of exchange rates or other factors; |
|--------|--------|---------------------------------------------------------------------------------------------|

|   | · | risks relating to our shareholder structure, including the concentration of share ownership in the hands of existing shareholders, who will continue to be able to exercise controlling influence on us and whose interests may not be aligned with those of other shareholders; and |
|--------|--------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | the other factors listed under "Risk Factors" and elsewhere in this annual report. |
|--------|--------|------------------------------------------------------------------------------------|

----

----

----

|                                                                     |   | As of and for the Year Ended December 31,                |       |
|--------------------------------------------------------------------------|--------|--------------------------------------------------------------------------------------------------|------------|
|                                                                     |   | 2010                                                                                             |       |   | 2009 |   |   | 2008 |   |   | 2007 |   |
|                                                                     |   | (in $ millions except for per share and share data) |       |
| Summary Consolidated Statement of Operations Data:                       |   |                                                                                             |       |   |   |   |   |   |   |   |   |   |
| Revenues                                                                 |   |                                                                                             | 1,759.3    |   |   |   | 1,695.1 |   |   |   | 1,904.5 |   |   |   | 1,735.6 |   |
| Cost of revenues                                                         |   |                                                                                             | 1,208.6    |   |   |   | 1,191.3 |   |   |   | 1,306.3 |   |   |   | 1,207.6 |   |
| Gross profit                                                             |   |                                                                                             | 550.8      |   |   |   | 503.8 |   |   |   | 598.2 |   |   |   | 528.0 |   |
| Selling expenses                                                         |   |                                                                                             | 165.5      |   |   |   | 159.4 |   |   |   | 183.4 |   |   |   | 166.5 |   |
| General and administrative expenses                                      |   |                                                                                             | 123.8      |   |   |   | 137.0 |   |   |   | 246.5 |   |   |   | 183.9 |   |
| Research and development expenses                                        |   |                                                                                             | 87.5       |   |   |   | 78.4 |   |   |   | 70.7 |   |   |   | 60.3 |   |
| Other operating income (expense), net                                    |   |                                                                                             | 2.1        |   |   |   | 14.8 |   |   |   | -39.5 |   |   |   | -2.9 |   |
| Operating income                                                         |   |                                                                                             | 176.0      |   |   |   | 143.8 |   |   |   | 58.2 |   |   |   | 114.4 |   |
| Interest expense, net                                                    |   |                                                                                             | 60.1       |   |   |   | 55.4 |   |   |   | 117.3 |   |   |   | 126.9 |   |
| Other income, net                                                        |   |                                                                                             | 3.0        |   |   |   | 3.3 |   |   |   | 2.9 |   |   |   | 2.9 |   |
| Total non-operating expenses                                             |   |                                                                                             | 57.1       |   |   |   | 52.1 |   |   |   | 114.4 |   |   |   | 124.0 |   |
| Income (loss) from continuing operations before income tax               |   |                                                                                             | 118.9      |   |   |   | 91.7 |   |   |   | -56.2 |   |   |   | -9.6 |   |
| Income tax expense                                                       |   |                                                                                             | 29.4       |   |   |   | 39.3 |   |   |   | 30.9 |   |   |   | 28.0 |   |
| Net income (loss) from continuing operations                             |   |                                                                                             | 89.5       |   |   |   | 52.3 |   |   |   | -87.1 |   |   |   | -37.6 |   |
| Net income from discontinued operations (1)                         |   |                                                                                             | 2.6        |   |   |   | 0.0 |   |   |   | 0.0 |   |   |   | 114.5 |   |
| Net income (loss)                                                        |   |                                                                                             | 92.0       |   |   |   | 52.3 |   |   |   | -87.1 |   |   |   | 76.9 |   |
| Net income (loss) attributable to Elster Group SE                        |   |                                                                                             | 87.3       |   |   |   | 48.9 |   |   |   | -91.7 |   |   |   | 72.3 |   |
|                                                                     |   |                                                                                             |       |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Weighted average number of ADS outstanding (2)                           |   |                                                                                             |       |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Basic                                                                    |   |                                                                                             | 77,182,292 |   |   |   | 65,283,000 |   |   |   | 65,283,000 |   |   |   | 65,283,000 |   |
| Diluted                                                                  |   |                                                                                             | 77,199,108 |   |   |   | 65,283,000 |   |   |   | 65,283,000 |   |   |   | 65,283,000 |   |
|                                                                     |   |                                                                                             |       |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Weighted average number of shares outstanding (3)                        |   |                                                                                             |       |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Basic                                                                    |   |                                                                                             | 19,295,573 |   |   |   | 16,320,750 |   |   |   | 16,320,750 |   |   |   | 16,320,750 |   |
| Diluted                                                                  |   |                                                                                             | 19,299,777 |   |   |   | 16,320,750 |   |   |   | 16,320,750 |   |   |   | 16,320,750 |   |
|                                                                     |   |                                                                                             |       |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Basic income (loss) per ADS (2)                                          |   |                                                                                             |       |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Income (loss) from continuing operations attributable to Elster Group SE |   |                                                                                             | 0.85       |   |   |   | 0.36 |   |   |   | -1.42 |   |   |   | -0.65 |   |
| Income from discontinued operations attributable to Elster Group SE      |   |                                                                                             | 0.03       |   |   |   | 0.00 |   |   |   | 0.00 |   |   |   | 1.76 |   |
| Net income (loss) per ADS attributable to Elster Group SE shareholders   |   |                                                                                             | 0.88       |   |   |   | 0.36 |   |   |   | -1.42 |   |   |   | 1.11 |   |
|                                                                     |   |                                                                                             |       |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Diluted income (loss) per ADS (2)                                        |   |                                                                                             |       |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Income (loss) from continuing operations attributable to Elster Group SE |   |                                                                                             | 0.85       |   |   |   | 0.36 |   |   |   | -1.42 |   |   |   | -0.65 |   |
| Income from discontinued operations attributable to Elster Group SE      |   |                                                                                             | 0.03       |   |   |   | 0.00 |   |   |   | 0.00 |   |   |   | 1.76 |   |
| Net income (loss) per ADS attributable to Elster Group SE shareholders   |   |                                                                                             | 0.88       |   |   |   | 0.36 |   |   |   | -1.42 |   |   |   | 1.11 |   |
|                                                                     |   |                                                                                             |       |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Basic income (loss) per share (4)                                        |   |                                                                                             |       |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Income (loss) from continuing operations attributable to Elster Group SE |   |                                                                                             | 3.39       |   |   |   | 1.42 |   |   |   | -5.68 |   |   |   | -2.58 |   |
| Income from discontinued operations attributable to Elster Group SE      |   |                                                                                             | 0.13       |   |   |   | 0.00 |   |   |   | 0.00 |   |   |   | 7.02 |   |
| Net income (loss) per share attributable to Elster Group SE shareholders |   |                                                                                             | 3.53       |   |   |   | 1.42 |   |   |   | -5.68 |   |   |   | 4.44 |   |
|                                                                     |   |                                                                                             |       |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Diluted income (loss) per share (4)                                      |   |                                                                                             |       |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Income (loss) from continuing operations attributable to Elster Group SE |   |                                                                                             | 3.39       |   |   |   | 1.42 |   |   |   | -5.68 |   |   |   | -2.58 |   |
| Income from discontinued operations attributable to Elster Group SE      |   |                                                                                             | 0.13       |   |   |   | 0.00 |   |   |   | 0.00 |   |   |   | 7.02 |   |
| Net income (loss) per share attributable to Elster Group SE shareholders |   |                                                                                             | 3.53       |   |   |   | 1.42 |   |   |   | -5.68 |   |   |   | 4.44 |   |

----

|                                                                  |   | As of and for the Year Ended December 31,                |    |
|-----------------------------------------------------------------------|--------|--------------------------------------------------------------------------------------------------|---------|
|                                                                  |   | 2010                                                                                             |    |   | 2009 |   |   | 2008 |   |   | 2007 |   |
|                                                                  |   | (in $ millions except for per share and share data) |    |
| Selected Cash Flow Data:                                              |   |                                                                                             |    |   |   |   |   |   |   |   |   |   |
| Cash flows from operating activities                                  |   |                                                                                             | 141.3   |   |   |   | 119.6 |   |   |   | 114.1 |   |   |   | 110.9 |   |
| Net cash flow from (used in) investing activities                     |   |                                                                                             | -28.0   |   |   |   | -43.0 |   |   |   | -79.0 |   |   |   | 46.0 |   |
| Net cash flow from (used in) financing activities                     |   |                                                                                             | 25.4    |   |   |   | -77.4 |   |   |   | -8.7 |   |   |   | -274.7 |   |
|                                                                  |   |                                                                                             |    |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Selected Consolidated Balance Sheet Data:                             |   |                                                                                             |    |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Cash and cash equivalents                                             |   |                                                                                             | 216.3   |   |   |   | 75.4 |   |   |   | 74.3 |   |   |   | 53.0 |   |
| Total assets                                                          |   |                                                                                             | 2,164.3 |   |   |   | 2,141.4 |   |   |   | 2,181.5 |   |   |   | 2,223.3 |   |
| Short-term debt and current portion of long-term debt                 |   |                                                                                             | 18.0    |   |   |   | 39.0 |   |   |   | 27.1 |   |   |   | 68.9 |   |
| Long-term debt, less current portion                                  |   |                                                                                             | 822.4   |   |   |   | 971.4 |   |   |   | 1,024.1 |   |   |   | 1,053.6 |   |
| Total debt                                                            |   |                                                                                             | 840.4   |   |   |   | 1,010.4 |   |   |   | 1,051.2 |   |   |   | 1,122.5 |   |
| Shareholder loan                                                      |   |                                                                                             | 0.0     |   |   |   | 6.8 |   |   |   | 6.2 |   |   |   | 408.3 | (5) |
| Total equity attributable to Elster Group SE                          |   |                                                                                             | 640.7   |   |   |   | 416.6 |   |   |   | 412.9 |   |   |   | -36.1 |   |
| Total equity                                                          |   |                                                                                             | 656.2   |   |   |   | 422.7 |   |   |   | 418.8 |   |   |   | -29.1 |   |
|                                                                  |   |                                                                                             |    |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Selected Operating and Other Data:                                    |   |                                                                                             |    |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Backlog (6)                                                      |   |                                                                                             | 454.2   |   |   |   | 445.3 |   |   |   | 542.1 |   |   |   | 383.5 |   |
| Capital expenditures                                                  |   |                                                                                             | 42.4    |   |   |   | 30.5 |   |   |   | 81.8 |   |   |   | 53.5 | (7) |
|                                                                  |   |                                                                                             |    |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Reconciliation of Net Income Before Amortization of PPA to Net Income |   |                                                                                             |    |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Net income (loss)                                                     |   |                                                                                             | 92.0    |   |   |   | 52.3 |   |   |   | -87.1 |   |   |   | 76.9 |   |
| Amortization of intangible assets on PPA, net of tax effect           |   |                                                                                             | 22.4    |   |   |   | 22.7 |   |   |   | 23.6 |   |   |   | 23.8 |   |
| Net income (loss) before amortization of PPA (8)                      |   |                                                                                             | 114.4   |   |   |   | 75.0 |   |   |   | -63.5 |   |   |   | 100.7 |   |

----

|                                                                      |   | As of and for the Year Ended December 31,                |   |
|---------------------------------------------------------------------------|--------|--------------------------------------------------------------------------------------------------|--------|
|                                                                      |   | 2010                                                                                             |   |   | 2009 |   |   | 2008 |   |   | 2007 |   |
|                                                                      |   | (in $ millions except for per share and share data) |   |
| Reconciliation of Adjusted EBITDA to Net Income:                          |   |                                                                                             |   |   |   |   |   |   |   |   |   |   |
| Net income (loss)                                                         |   |                                                                                             | 92.0   |   |   |   | 52.3 |   |   |   | -87.1 |   |   |   | 76.9 |   |
| Net income from discontinued operations                                   |   |                                                                                             | 2.6    |   |   |   | 0.0 |   |   |   | 0.0 |   |   |   | 114.5 |   |
| Net income (loss) from continuing operations                              |   |                                                                                             | 89.5   |   |   |   | 52.3 |   |   |   | -87.1 |   |   |   | -37.6 |   |
| Income tax expense                                                        |   |                                                                                             | 29.4   |   |   |   | 39.3 |   |   |   | 30.9 |   |   |   | 28.0 |   |
| Interest expense, net                                                     |   |                                                                                             | 60.1   |   |   |   | 55.4 |   |   |   | 117.3 |   |   |   | 126.9 |   |
| Depreciation and amortization                                             |   |                                                                                             | 85.5   |   |   |   | 85.4 |   |   |   | 85.3 |   |   |   | 85.8 |   |
| Foreign currency exchange effects                                         |   |                                                                                             | -2.9   |   |   |   | -14.4 |   |   |   | 45.2 |   |   |   | 5.7 |   |
| Management equity program                                                 |   |                                                                                             | -13.6  |   |   |   | -33.3 |   |   |   | 90.7 |   |   |   | 31.1 |   |
| Expenses for preparation to become a public company                       |   |                                                                                             | 12.7   |   |   |   | 23.0 |   |   |   | 7.0 |   |   |   | 0.0 |   |
| Strategy development costs                                                |   |                                                                                             | 0.3    |   |   |   | 3.6 |   |   |   | 7.8 |   |   |   | 4.6 |   |
| Employee termination and exit costs                                       |   |                                                                                             | 6.2    |   |   |   | 25.4 |   |   |   | 10.5 |   |   |   | 15.2 |   |
| Business process reengineering and reorganization costs                   |   |                                                                                             | 5.9    |   |   |   | 16.8 |   |   |   | 3.2 |   |   |   | 13.3 |   |
| IT project costs                                                          |   |                                                                                             | 1.9    |   |   |   | 8.6 |   |   |   | 3.6 |   |   |   | 4.2 |   |
| Gain (loss) from sales of real estate                                     |   |                                                                                             | 0.0    |   |   |   | -2.5 |   |   |   | -0.8 |   |   |   | -3.4 |   |
| Effects of termination of a distributor                                   |   |                                                                                             | 9.8    |   |   |   | 0.0 |   |   |   | 0.0 |   |   |   | 0.0 |   |
| Pension curtailments                                                      |   |                                                                                             | 0.0    |   |   |   | 0.0 |   |   |   | 0.0 |   |   |   | -3.6 |   |
| Insurance recovery                                                        |   |                                                                                             | 0.0    |   |   |   | 0.0 |   |   |   | 0.0 |   |   |   | -2.6 |   |
| Business combination costs                                                |   |                                                                                             | 0.0    |   |   |   | 1.7 |   |   |   | 0.0 |   |   |   | 0.0 |   |
| Impairment of intangible assets                                           |   |                                                                                             | 0.0    |   |   |   | 2.3 |   |   |   | 1.3 |   |   |   | 0.0 |   |
| Other                                                                     |   |                                                                                             | 0.3    |   |   |   | 0.3 |   |   |   | -0.2 |   |   |   | 0.2 |   |
| Adjusted EBITDA (9)                                                  |   |                                                                                             | 285.0  |   |   |   | 264.1 |   |   |   | 314.6 |   |   |   | 267.7 |   |
|                                                                      |   |                                                                                             |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Reconciliation of Free Cash Flow to Cash Flows From Operating Activities: |   |                                                                                             |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Cash flows from operating activities                                      |   |                                                                                             | 141.3  |   |   |   | 119.6 |   |   |   | 114.1 |   |   |   | 110.9 |   |
| Purchases of property, plant and equipment and intangible assets          |   |                                                                                             | 42.4   |   |   |   | 30.5 |   |   |   | 81.8 |   |   |   | 53.5 |   |
| Free cash flow (10)                                                  |   |                                                                                             | 98.9   |   |   |   | 89.1 |   |   |   | 32.3 |   |   |   | 57.4 |   |

| (1) | We disposed of the Ipsen Group, a manufacturer of industrial furnaces, as well as NGT Neue Gebäudetechnik GmbH, or NGT, in 2007 as part of our plan to focus on our core competencies. We included these businesses in discontinued operations. In 2010, we recorded a gain from the release of a provision in connection with a disposal as described in Note 3 to the consolidated financial statements contained elsewhere in this annual report. |
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| (2) | Each ADS represents one-fourth of an ordinary share. |
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| (3) | For the financial years 2007-2009 the weighted average number of shares outstanding was equal to the number of ordinary shares outstanding immediately prior to our initial public offering, or IPO. See "Item 4. Information on the Company—Transactions Relating to Our Share Capital—Our Pre-IPO Capital Structure." |
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| (4) | For more information on the calculation of our earnings (loss) per share, see Note 8 to the consolidated financial statements contained elsewhere in this annual report. |
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| (5) | In 2007, our shareholder loan reflects the value before our preferred equity certificates were contributed into our equity. See "Item 4. Information on the Company—Transactions Relating to Our Share Capital.” |
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| (6) | We define backlog as our total open purchase orders. |
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| (7) | Our capital expenditures for 2007 include $5.5 million that were attributable to discontinued operations. |
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| (8) | We define net income before amortization of PPA as net income (loss) excluding the expenses associated with the amortization of that portion of our intangible assets that comprises the allocation of the purchase price we paid in our business acquisitions in excess of the previous carrying amount of the intangible assets before the acquisition occurred. We refer to the adjusted expense as amortization before PPA. We also present this amortization measure net of the income tax effects. We believe that this non-GAAP financial measure is useful to management, investors and financial analysts in assessing our company's operating performance because it excludes the effect of the non-cash expenses that are related solely to the allocation of purchase prices paid in business acquisitions to those intangible assets acquired in connection with these business acquisitions. Fair values for these balancesheet items are determined as of the time of an acquisition and then amortized over their respective useful lives, which generally cannot be changed or influenced by management after the acquisition. By excluding these amortization expenses and the related income tax effects, we believe that it is easier for our management, investors and financial analysts to compare our financial results over multiple periods and analyze trends in our operations. For example, expenses related to amortization of intangible assets are now decreasing, but the positive effect of this decrease on our net income is not necessarily reflective of the operations of our businesses. |
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| (9) | Adjusted earnings before interest, tax expense, depreciation and amortization, or Adjusted EBITDA, reflects adjustments for certain gains and charges for which we believe adjustment is permitted under our Senior Facilities Agreement as described in "Item 5. Operating and Financial Review and Prospects—Special Note Regarding Non-GAAP Financial Measures." |
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| (10)  | We define free cash flow as cash flows from operating activities less purchases of property, plant and equipment and intangible assets. Free cash flow is not defined under U.S. GAAP and may not be comparable with measures of the same or similar title that are reported by other companies. Under SEC rules, "free cash flow" is considered a non-GAAP financial measure. It should not be considered as a substitute for, or confused with, any U.S. GAAP financial measure. There are important limitations related to the use of free cash flow instead of cash flows from operating activities calculated in accordance with U.S. GAAP. We believe the most comparable U.S. GAAP measure to free cash flow is cash flows from operating activities. We reportfree cash flow to provide investors with a measure that can be used to evaluate changes in liquidity after taking capital expenditures into account. It is not intended to represent residual cash flow available for discretionary expenditures, since debt service requirements or other non-discretionary expenditures are not deducted. We urge you not to rely on any single financial measure to evaluate our business but instead to form your view on our business with reference to our annual consolidated financial statements included elsewhere in this annual report and the other information we present in this annual report. In 2007, free cash flow includes our discontinued operations. We describe free cash flow below under "Item 5. Operating and Financial Review and Prospects —Liquidity and Capital Resources." |
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| Year Ended December 31, |   | Average |   |
|----------------------------------------|--------|---------|--------|
| 2006                                   |   |    | 1.2661 |   |
| 2007                                   |   |    | 1.3797 |   |
| 2008                                   |   |    | 1.4705 |   |
| 2009                                   |   |    | 1.3956 |   |
| 2010                                   |   |    | 1.3220 |   |

| Month of 2010 |   | High   |   |   | Low    |   |
|-------------------------|--------|--------|--------|--------|--------|--------|
| August                  |   |   | 1.3282 |   |   |   | 1.2652 |   |
| September               |   |   | 1.3634 |   |   |   | 1.2679 |   |
| October                 |   |   | 1.4084 |   |   |   | 1.3685 |   |
| November                |   |   | 1.4207 |   |   |   | 1.2983 |   |
| December                |   |   | 1.3414 |   |   |   | 1.3100 |   |
|                    |   |   |   |   |   |   |   |   |
| Month of 2011           |   |   |   |   |   |   |   |   |
| January                 |   |   | 1.3688 |   |   |   | 1.2944 |   |
| February                |   |   | 1.3794 |   |   |   | 1.3474 |   |
| March (through March 4) |   |   | 1.3983 |   |   |   | 1.3813 |   |

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|   | · | local or regional economic downturns, some of which can be severe; |
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|   | · | withholding taxes imposed on dividends and other payments by subsidiaries; |
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|   | · | difficulties in enforcing contracts and collecting accounts receivable, and longer payment cycles, especially in emerging markets; |
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|   | · | restrictions on our ability to own or operate subsidiaries, make investments or acquire new businesses in various jurisdictions; |
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|   | · | inability to develop successful relationships with local distributors; |
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|   | · | difficulty in staffing and managing our local operations around the world; |
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|   | · | changes in law, regulations or governmental policies in the individual jurisdictions in which we operate, including potentially negative consequences from changes in tax laws; |
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|   | · | the expense of complying with a wide variety of national and local laws, regulations, trade standards, treaties and technical standards and changes in them, and the risk of liability or the risk of being prohibited from doing business in a jurisdiction arising from any failures to comply with them; |
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|   | · | challenges to our internal policies, oversight and compliance processes and information systems posed by our widely dispersed operations; |
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|   | · | different legal regimes controlling the protection of our intellectual property; |
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|   | · | exchange controls imposed by various countries and changed from time to time in ways that can be disadvantageous for us; |
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|   | · | nationalization of foreign assets; |
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|   | · | political instability, especially in some of the emerging markets in which we do business; |
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|   | · | local and regional conflicts and unrest; |
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|   | · | import and export duties, tariffs, quotas and other trade barriers, or other forms of government protectionism; and |
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|   | · | continued and/or repeated interruption of gas supply by one or more countries or companies producing natural gas. |
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|   | · | the size and timing of deployments may vary, as might the time at which we recognize the associated revenue, especially in the case of large and complex contracts for our Smart Offerings. Equally, deployments under major rollouts may be concentrated in particular quarters, leading to the possibility of large quarterly revenue swings; |
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|   | · | exchange rates that impact our operating results could change suddenly and significantly; |
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|   | · | our mix of products and services in any one quarter may change significantly, especially if individual contract sizes are larger, even if the mix is less volatile over time; |
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|   | · | expenses relating to our share-based compensation arrangements may be higher than expected in any given period; |
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|   | · | we may be subject to unexpected warranty liabilities that may, in turn, require us to accrue lump sum provisions; |
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|   | · | the timing and production levels of our new product developments may be delayed or overly optimistic; |
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|   | · | the timing and availability to our customers of government stimulus funding; |
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|   | · | components or raw materials that are material for us may quickly become less easily available in the quantities we need at attractive prices or may be subject to shortages. Moreover, prices for these components and raw materials can swing rapidly; |
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|   | · | we may experience other, potentially severe, interruptions in our supply chain; and |
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|   | · | general economic conditions affecting enterprise spending for the utility industry may change quickly and adversely. |
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|   | · | As part of our consolidation each period, we translate the balance sheet items in the financial statements of those entities in our group that have functional currencies other than the U.S. dollar into U.S. dollars at the period-end exchange rates. The translated values in respect of each entity fluctuate over time with the movement of the exchange rate for the entity's functional currency against the dollar. We refer to this as the currency translation effect. It is not practicable to hedge against this risk.  |
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|   | · | Most of our entities make their purchases and sales primarily in their respective functional currencies. However, sometimes entities within the group make purchases and sales denominated in currencies other than their functional currencies. To the extent that an entity makes purchases in a currency that appreciates against its functional currency, its cost basis expressed in its functional currency will increase, or decrease, if the other currency depreciates against its functional currency. Similarly, for sales in a currency other than the entity's functional currency, its revenues will increase to the extent that the other currency appreciates against the entity's functional currency and decrease to the extent that currency depreciates against the entity's functional currency. These movements can have a material effect on the gross margin of the entity concerned and on our consolidatedgross margin. We refer to this as the currency transaction effect. |
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|   | · | After a purchase or sale is completed, the currency transaction effect continues to affect foreign currency accounts payable and accounts receivable on the books of those entities that made purchases or sales in a foreign currency. These entities are required to remeasure these balances at market exchange rates at the end of a period. In 2008, we incurred a foreign currency loss of $7.4 million resulting from these remeasurements; in 2009, we recognized a gain of $2.9 million and in 2010, we incurred a gain of $2.3 million. We intend, through our group treasury function, to enter into foreign currency derivative financial products to mitigate exchange rate risks when the appropriate financial products are available on attractive terms. However, it is often economically disadvantageous to pay the costs associated with hedging against every possible currency movement, particularly betweencurrencies that have traditionally been rather stable, and we will continue to be subject to this risk.  |
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|   | · | a significant underperformance relative to historical or projected future operating results; |
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|   | · | significant changes in the nature of or use of the acquired assets or the strategy for our overall business; |
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|   | · | significant negative industry or general economic trends; |
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|   | · | changes in our organization or management reporting structure could result in additional reporting units, which may require alternative methods of estimating fair values or greater aggregation or disaggregation in our analysis by reporting unit;  |
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|   | · | a sustained decline in our market capitalization below net book value; and |
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|   | · | the harmonization of company trademarks throughout our group. |
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|   | · | the volatility of the prices for our products and therefore of our revenues; |
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|   | · | changes in demand for, and supply of, our products; |
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|   | · | changes in market valuations of companies in our industry in general, and metering companies in particular; |
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|   | · | variations in our operating results (actual or anticipated); |
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|   | · | technological changes that hurt our competitive position; |
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|   | · | manifestations of uninsured risks; |
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|   | · | unfavorable developments in litigation, governmental investigations or administrative proceedings in which we may be involved; |
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|   | · | developments in the regulatory landscape in countries in which we operate; |
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|   | · | strategic moves by us or our competitors including, for example, acquisitions, alliances or restructurings; |
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|   | · | failure or anticipated failure of our quarterly or annual operating results to meet market expectations; |
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|   | · | changes in expectations as to our future financial performance, including financial estimates by securities analysts; |
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|   | · | reviews of the long-term values of our assets, which could lead to impairment charges that negatively impact our earnings; |
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|   | · | release/expiration of the lock-up agreement or other restrictions on transfer of the ADSs; |
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|   | · | sales or anticipated sales of additional ADSs; and |
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|   | · | general market conditions. |
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|   | · | establish a nominating, compensation and audit committee composed entirely of independent directors; |
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|   | · | adopt and disclose a code of business conduct and ethics for directors, officers and employees; and |
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|   | · | promptly disclose any waivers of the code for directors or executive officers that should address certain specified items. |
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|   | · | an affirmative determination that all members of the Audit Committee are “independent,” using more stringent criteria than those applicable to us as a foreign private issuer; |
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|   | · | the adoption of a written charter specifying, among other things, the audit committee’s purpose and including an annual performance evaluation; and |
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|   | · | the review of an auditor’s report describing internal quality-control issues and procedures and all relationships between the auditor and us. |
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|   | · | 198,573,625 non-convertible preferred equity certificates "A," which we refer to as the A PECs, each with a nominal value of €1 and bearing an interest rate of 8% per annum, to Rembrandt; |
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|   | · | 125,686,400 non-convertible preferred equity certificates "B," which we refer to as the B PECs, each with a nominal value of €1 and bearing interest at a rate of 6.8% per annum, to Rembrandt; and |
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|   | · | 5,067,925 B PECs to the Management KG. |
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|   | · | Our 52,830 existing shares were reclassified as 52,830 Class B Shares, still with a nominal value of €25 each. |
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|   | · | Our share capital was increased by €25 to €1,320,775 through the issuance of one Class A Share with a nominal value of €25. |
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|   | · | Rembrandt subscribed for that single share through a contribution in kind in which Rembrandt contributed its 198,573,625 A PECs and its 37,325,085 B PECs to our equity. |
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|   | · | We allocated the value of this contribution in kind in excess of the nominal value of €25 of the share, which was €293,217,142 (including accrued interest), to a segregated premium account relating to the single Class A Share. The Class A Share carried the entitlement to a cumulative preferred dividend in the amount of 6.29% per annum (calculated on its nominal value plus the segregated premium). |
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|   | · | We reduced the nominal value of the Class A Share and the Class B Shares from €25 each to €1 each, which is the minimum amount required for an SE organized under the laws of Germany, so that the share capital consisted of 25 Class A Shares and 1,320,750 Class B Shares. |
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|   | · | We increased our share capital by an amount of €15 million through the issuance of 15 million new Class B Shares against conversion to share capital of other reserves in that amount. |
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|   | · | Rembrandt subscribed for 13,500,000 of the new Class B Shares and the Management KG subscribed for the other 1,500,000 new Class B Shares. |
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|   | · | We further increased our share capital by converting both the accrued but unpaid preferred dividends related to the Class A Share in an amount of €15,714,753 and the share premium in the amount of €293,217,142 into share capital. This created additional share capital of €308,931,895 through the issuance of 308,931,895 new Class A Shares, each with nominal value of €1, no segregated premium account. |
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|   | · | We reclassified all of the Class B Shares as ordinary shares. |
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|   | · | We converted the Class A shares into preferred shares with an entitlement to a cumulative preferred dividend in the amount of 5.96%. The holders of preferred shares were excluded from any dividend and distribution rights in any profits of our company to the extent that the amount thereof exceeds the aggregate preferred dividend accrued and unpaid. The holders were excluded from any participation in the distribution of liquidation proceeds in excess of the nominal value of the preferred shares plus the aggregate amount of any accrued but unpaid preferred dividend. |
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|   | · | The conversion of 8,533,906 preferred shares into 8,533,906 ordinary shares, which was the result obtained by dividing Rembrandt's aggregate interest in the preferred shares it held at the date of our IPO, €326,032,698 (the sum of the aggregate nominal value of these preferred shares (€308,931,920) plus the cumulative preferred dividend on these preferred shares accrued up to September 30, 2010, at a rate of 5.96% per annum (€17,100,778)), by the initial public offering price per ordinary shares in euro, or €38.20. |
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|   | · | Immediately before the conversion described above, the remaining 300,398,014 preferred shares held by Rembrandt that were not being converted into ordinary shares were redeemed, and the capital was decreased accordingly. Rembrandt waived its right to receive any of the proceeds of that capital reduction and redemption, and these preferred shares ceased to exist without any further value accruing to Rembrandt. |
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|   | · | the first electronic electricity meter in 1978; |
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|   | · | a commercial system using power line carrier communications, or PLC in 1981; |
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|   | · | an integrated remote connect or disconnect function deployed in commercial volumes in 2004; |
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|   | · | an AMI solution based on RF mesh network technology in 2003; and |
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|   | · | a Smart Grid solution system with over 1.5 million endpoints in 2008. |
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|   | · | We are a leading global provider of gas, electricity and water meters and metering solutions.    With almost 175 years of experience serving utility customers globally, we are one of the world’s largest providers of meters and metering solutions to utilities. We believe we have one of the most extensive installed meter bases in the world, with more than 200 million meters deployed over the course of the last ten years. We believe that this installed base provides us with a significant opportunity to benefit from regular meter replacement and upgrade cycles and a loyal customer base. |
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|   | · | We are a leading enabler of Smart Grid solutions, which are already proven at scale in complex environments and across diverse utility settings.    Our EnergyAxis systems extend across the Smart Grid value chain and include smart meters, two-way communication networks, information and meter data management software and advanced applications that help customers to cost-effectively generate, deliver, manage and conserve gas, electricity and water. As of December 31, 2010, we have delivered over twelve million of our two-way communication endpoints for metering applications, including over 7.8 million that are enabled for fixed networks. Of this total, our utility customers have deployed more than 5.1 million smart meters in more than 85 EnergyAxis systems worldwide. |
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|   | · | We maintain strong customer relationships worldwide that provide us with diverse opportunities for global growth and competitive advantage.    Our customers operate in more than 130 countries and include numerous large utilities. In our experience, length of service and reputation are highly valued by customers. We believe that we have provided the utility market with accurate and reliable metering and meter automation products and solutions for almost 175 years. While the adoption of Smart Grids has created opportunities for new entrants into our industry from outside the metering business, we believe that the continued importance of the meter, our industry experience and our ability to innovate, position us well to benefit from the ongoing introduction of Smart Grid solutions. We work closelywith our customers to help them determine technical specifications and design individualized solutions for their networks. We believe that this engagement allows us to gain important insights into our customers’ existing and emerging needs and offers us the opportunity to develop and deliver competitive and relevant solutions. |
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|   | · | We have a capable and experienced global management team.    Our managers have been instrumental in establishing our business strategy, driving our new product introductions and securing our leading positions in metering and Smart Grid solutions. We believe that our management’s in-depth understanding of our industry and our customers’ needs is the result of many years of combined industry experience across the metering, telecommunications, system automation, software and IT services markets and most of our management has a long history with our company. |
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|   | · | Continue to build upon our global leadership.    Through continued technological innovation and close cooperation with other key industry participants, we intend to contribute to the transformation of the gas, electricity and water utility markets and to take advantage of the significant business opportunities we expect will arise to provide Smart Grid solutions. We believe utilities will increasingly direct new business to those suppliers that enjoy a leadership position within each market, have an extensive understanding of their business models and needs, and are able to address these through a wide portfolio of high quality, competitive products and solutions. We believe that we are well positioned to capture a significant portion of the substantial organic growth that we believe will occurover the coming years and are prepared to meet the challenges we anticipate as we face competition from traditional metering companies and new entrants such as communications, network infrastructure and software firms, among others, seek to enter our industry. Where we perceive technological or geographic expansion as useful to our business model, we will make targeted acquisitions and enter into partnerships. |
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|   | · | Capitalize on the expected ongoing growth in metering and related infrastructure in gas, electricity and water.    We believe we are well positioned to take advantage of expected expansion of natural gas infrastructure and conversion to natural gas as a favored fuel source, as well as the increase in gas meter penetration worldwide. We also intend to take advantage of perceived opportunities in onshore gas development and related infrastructure investment, including in industrial gas flow equipment, over the next decade. We intend to take advantage of potential future opportunities for expansion in the many developed and developing regions where water meter penetration rates remain low, and of similar opportunities for growth in the electricity market given ongoing electrification initiatives andurbanization trends in developing countries. |
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|   | · | Build on our history of innovation and engineering expertise.    We intend to continue the focus of our research and development organization on providing our customers with best-in-class meters and metering and Smart Grid solutions across the gas, electricity and water segments. We believe that our ability to succeed in implementing this strategy will be supported by our large number of market innovations, both in the past and in the developing Smart Grid market. We are among the industry participants on various standard setting bodies including the American National Standards Institute, which establish product specifications and performance in the industry. |
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|   | · | Use our understanding of evolving customer business models and deploy our key account management teams to capture Smart Grid solutions opportunities.    We believe that our long history serving the utility industry has given us familiarity with the various business models, challenges and environments of our global customer base. As our customers adopt new metering and Smart Grid solutions, we have seen that their purchasing decisions have involved a broader variety of constituencies than has been the case with traditional metering investments. We intend to strengthen our account management teams further to even more effectively leverage and broaden our customer relationships to develop and deliver metering and Smart Grid solutions despite new entrants in the market. We are already engaging with newexecutive-level decision makers and other project sponsors (for example, IT groups for communication systems) as they become involved in Smart Grid investment decisions. We also focus on the necessity to offer regionally differing and tailored solutions to our utility customers based on their specific technological requirements. We believe that this strategy has helped us to increase the percentage of our revenues from Smart Offerings. |
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|   | · | Focus on operational efficiency to drive consistent competitive advantage.    We believe that our strong focus on operational efficiency has provided us a scalable business platform. We plan to further develop our mixed production model, which utilizes both contract manufacturers and in-house production, to efficiently manage the significant volatility in volumes and delivery requirements often associated with large Smart Grid installations. We base our belief on our ability to ensure on-time delivery, in-field product performance and aftermarket support of these complex networks on our demonstrated execution on large contracts, including our Ontario, Arizona Public Service Company and Salt River projects. In addition, we plan to continue to further optimize our global operations and manufacturingfootprint, particularly in areas including gas and water metering, where we believe unique local standards are best met via our regional production and engineering capabilities. |
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|   | · | Manual-read meters are devices that measure gas, electricity and water consumption data. They are based on mechanical technology, in which mechanical components measure the movement of gas or water, electromechanical technology, in which electricity is measured by the mechanical movement of a disk, or solid state technology, in which gas, electricity or water is measured by electronic devices. Manual-read meters do not have communications capabilities, requiring the manual on-site reading of the usage data recorded by each meter. In our experience, critical quality criteria for manual-read meters include measurement accuracy, reliability, durability and, especially in the case of gas meters and regulators, safety. Manual-read meters will continue to be an important and stablesource of revenues for our industry in the future, as the evolution towards the Smart Grid, the meters included in it and related infrastructure will occur at differing rates within the gas, electricity and water industries across different regions and end markets. |
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|   | · | Automated Meter Reading, or AMR, typically enables one-way communication of periodic consumption data from the meter to the utility, thereby eliminating the need to enter the consumer’s premises. AMR is usually accomplished either through the use of a wireless technology such as radio frequency, or RF (which includes cellular telephony), wired telephony, or power line communications technology, or PLC, using the utility’s existing power lines. Simpler AMR systems permit data to be collected through the use of “walk-by” or “drive-by” meter readings that can be made from a point close to the meter, while more advanced transmission technologies, such as cellular telephony, many power line systems and some radio frequency systems, permit meterreading to take place from more remote locations. We believe that our industry will continue to experience demand for AMR systems as utilities seek to reduce their operating costs without the requirement for two-way communication or other more advanced capabilities. |
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|   | · | Advanced Metering Infrastructure, or AMI, is a technology that allows two-way communication between the smart meter and the utility or other parties, such as the consumer. For electricity meters, RF mesh communications technology is used in North America, whereas PLC or General Packet Radio Service, or GPRS, technology is preferred by most utilities in Europe. RF mesh technology uses a radio frequency communications network in which nodes within the system can act as communications paths to other nodes within the system, allowing a path around communications blockages and improving the reliability and efficiency of communications systems. For gas and water meters, RF is preferred due to its low implementation cost. In addition to the remote, real-time collection of consumptiondata, AMI technology integrates interactive features, including the ability to disconnect or reconnect service, upgrade devices and deliver instructions to other devices. These smart metering systems can provide the basis for more advanced Smart Grid applications such as in-home displays and real-time pricing. AMI currently has relatively low penetration rates worldwide and is predominantly used in electricity metering applications. The continued adoption and global rollouts across gas, electricity and water will provide extensive opportunities for our industry in the coming years. |
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|   | · | encouraging conservation, reduce carbon dioxide and other emissions and promote more efficient use of energy and scarce natural resources; |
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|   | · | improving grid reliability; |
|--------|--------|-----------------------------|

|   | · | increasing metering and automation within the grid itself in support of deregulation to allow consumers to choose among multiple vendors of gas, electricity and water; |
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|   | · | enabling increased competition in the provision of gas, electricity and water; |
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|   | · | promoting consumer awareness and the ability to intelligently implement more complex billing systems; |
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|   | · | reducing operating costs for utilities and prices for consumers; |
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|   | · | enabling dynamic pricing models, including, in the case of electricity, critical peak pricing and demand response; |
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|   | · | permitting, in the case of water, the flexible and efficient management of and response to scarcity issues and drought conditions; |
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|   | · | reducing energy and water dependencies within and among countries; |
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|   | · | enabling, in the case of electricity, a shift to electric vehicles; and |
|--------|--------|-------------------------------------------------------------------------|

|   | · | facilitating, in the case of electricity, renewable (solar and wind) generation and distributed generation, including functionality that permits consumers to feed electricity into the grid. |
|--------|--------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

----

|   | · | Applications:    Our applications are designed to integrate Smart Grid solutions into a range of utility specified settings or legacy applications, using a number of open and standards-based interfaces. In addition, we provide or are working to develop a number of specialty applications including security management, communications scheduling, demand response and energy management, and we plan to continue to do so as the industry evolves. |
|--------|--------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | Meter Data Management, or MDM, refers to software that provides data validation, estimation, aggregation and storage services for utilities. MDM enables detailed management of energy requirements within the Smart Grid. MDM systems generally connect to utilities' internal systems and support detailed grid and energy management activities such as multi-tariff billing, meter reading validation and estimation, outage management, transmission planning, demand management and customer self-service, customer prepayment and remote disconnect/reconnect. Our EIServer is a flexible and scalable MDM system supporting our multi-utility AMI applications as well as those of third parties. It has been used in conjunction with some of our largest AMI deployments. |
|--------|--------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | Head-End software:    Head-end software is used to manage information flows across networks. Our head-end products provide distributed intelligence to reduce the complexity of the communication network, including its structure, protocols, security, monitoring and maintenance, and certain specialty applications, such as MDM. |
|--------|--------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | Wide Area Networks, or WANs, are communications networks that connect the utility to a variety of components, networks and systems and that commonly use public wireless technologies. We provide a variety of WAN communications technology options to communicate with endpoints, collection nodes, LAN Gateways and other assets in the system with internet protocol-, or IP-, based and other wired, wireless and fiber networks. These interfaces include wired and wireless (cellular) telephony, WiFi/WiMax RF, private RF, satellite communications and a broadband power line carrier. |
|--------|--------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | Collection includes the infrastructure and software that enables data from different meters and meter types to be collected for use by a meter data management system within the Smart Grid. It often consists of data collection devices, which may contain embedded software that enables certain Smart Grid functionality. Our collection products use decision-making software at various locations, or distributed intelligence, to manage and maintain a wired or wireless Local Area Network, or LAN, as well as gather, filter and/or prepare data from points on the LAN for transmittal to the head-end over a WAN. Our EA GateKeeper supports our RF mesh networks and our Evolution water networks. |
|--------|--------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

|   | · | Local Area Networks:    We provide a variety of LAN communications technology options to reliably and cost-effectively communicate with utility endpoints. These wired and wireless interfaces include our EnergyAxis 900 MHz RF mesh, our Evolution RF network based on our Wavenis technology and 900/868/435 MHz bandwidths and a variety of utility specified PLC, Ethernet and RS232/485 wired communication using IP-based and other standards, including those of the Institute of Electrical and Electronics Engineers, the American National Standards Institute and the International Electrotechnical Commission. |
|--------|--------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | Meters and Communication Devices:    We provide a broad range of meters for most applications across gas, electricity and water with and without communication devices, electronic correction or data storage functionality, service disconnect switches or valves. Communications technologies can either be an integral part of the meter itself, or be incorporated into the device as a module. In the Smart Grid value chain, the meter typically currently accounts for more than half of the total purchase value of a complete solution. |
|--------|--------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | Home Area Networks:    We provide a variety of HAN communications technology options to extend the communications layer and interactivity into the consumer's premises or other equipment. These interfaces include a variety of wired networks, including Ethernet, M-Bus and RS242/485 and wireless networks including our EnergyAxis RF mesh, our Wavenis RF, ZigBee and Blueline. We also provide some utility-related equipment that interfaces via the HAN, such as in-home displays and load control devices. |
|--------|--------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | Speed:    EnergyAxis supports what we believe to be one of the industry's fastest LAN and WAN networks when it is implemented using our 900 MHz RF mesh AMI network technology. |
|--------|--------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | Scalability:    EnergyAxis has been deployed and is operating in the field at a scale of over 1.5 million endpoints and has demonstrated scalability in one customer's certification process for up to 35 million endpoints. |
|--------|--------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | Security:    EnergyAxis can employ advanced encryption technology throughout the network, from the HAN device and meter to the WAN, to protect utility and customer data. |
|--------|--------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | Interoperability:    EnergyAxis uses open standards, such as IP, RF mesh, PLC, WiFi, cellular and satellite technologies, that ensure it can interface with a wide variety of communications technologies for use in a particular Smart Grid. |
|--------|--------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | Investment protection:    EnergyAxis uses open standards and interoperability to ensure that it can adapt to new applications and facilitate future upgrades. Most installed EnergyAxis components can receive firmware upgrades directly from the utility over the Smart Grid, which permits changes to pricing, time of use and other parameters without on-site upgrades or replacing meters. |
|--------|--------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | Distributed intelligence:    EnergyAxis "distributes" intelligence across the Smart Grid, extending our Smart Grid solution into a utility's network to incorporate intelligence into smart meters, grid sensors, distribution network components and other control elements. |
|--------|--------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

|   | · | Our residential meters consist mainly of diaphragm gas meters, which enclose and measure defined volumes of gas in low flow applications (standard AMR- or AMI-enabled); and |
|--------|--------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | Our C&I meters consist of industrial diaphragm gas meters, suitable for high volumes, rotary gas meters, which have components that rotate to enclose the gas being measured, turbine gas meters, which measure the flow of gas, and ultrasonic gas meters, which use ultrasound technology to measure gas flows. We also offer meters specific to transmission settings, such as ultrasonic and turbine gas meters. |
|--------|--------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

----

|   | · | Single-phase meters are mainly deployed in homes and by small businesses. Our primary brand, the REX product family, offers numerous and highly flexible capabilities. Our REX branded meters offered integrated communication modules within the meter and allowed remote connect or disconnect functionalities in 2004. |
|--------|--------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | Polyphase meters are generally used by industrial businesses or in large commercial applications on certain conditions. We offer these meters under the Alpha brand, which focuses on durability and performance. |
|--------|--------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | Transmission and distribution meters are high performance meters designed to measure the flow of electricity within a utility's grid and are sold under our Alpha brand. |
|--------|--------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | In-home displays enable meter reading throughout the house and allow customers easy access to consumption and price data. |
|--------|--------|---------------------------------------------------------------------------------------------------------------------------|

----

|   | · | Single- and multi-jet meters record the volume of water consumed by measuring the velocity of water flowing through a known area, and are generally used for residential and small commercial applications. |
|--------|--------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | Volumetric meters employ an oscillating piston to measure volume of water consumption, a technology that is suited to low-flow environments, and therefore used primarily in homes and small businesses. |
|--------|--------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | Our electronic residential meter offering includes hybrid (containing an electronic register and mechanical sensor) and solid state meters (containing a fully electronic sensor and register), utilizing fluid oscillation measuring sensors. |
|--------|--------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | Bulk flow meters monitor large flows of water for water system management and commercial billing purposes. |
|--------|--------|------------------------------------------------------------------------------------------------------------|

|   | · | Combination meters include a small residential meter and large bulk flow meter within a single meter design and are used where wide variations in flow can be expected, such as in hospitals, schools, offices and other applications where both low and high flows can occur. |
|--------|--------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | Irrigation meters are designed specifically for distribution and billing applications where the water quality is poor and has high suspended content such as boreholes and raw water. |
|--------|--------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | Water meters for "sub-metering" purposes, which is the separate metering of individual dwelling units in apartment buildings for water cost allocation, a system common in Germany, France and Eastern Europe. |
|--------|--------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

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----

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| Location                         |   | Approximate Size(Land/Building) m2 |   | Primary Uses                                                                       |   | Owned or Leased(Land/Building) |
|----------------------------------|--------|---------------------------------------------------|--------|-----------------------------------------------------------------------------------------|--------|------------------------------------------|
|                             |   |                                              |   |                                                                                    |   |                                     |
| Raleigh, North Carolina (1) |   | */17,280                                          |   | Research, Design & Development, Production, Administration                          |   | Leased                                   |
| Plattsmouth, Nebraska            |   | */1,750                                           |   | Parts Warehouse                                                                         |   | Leased                                   |
| Nebraska City, Nebraska (2) |   | 79,000/23,775                                     |   | Production, Meter Services, Research, Design & Development, Warehouse, Office Space |   | Owned and Leased                         |
| Geneva, Ohio                     |   | 24,000/9,600                                      |   | Production, Warehouse                                                                   |   | Owned                                    |
| Ocala, Florida                   |   | */8,425                                           |   | Production, Office Space                                                                |   | Leased                                   |
| Luton, United Kingdom (3)   |   | */5,853                                           |   | Research, Design & Development, Production, Administration                     |   | Leased                                   |
| Essen, Belgium                   |   | 31,000/9,500                                      |   | Production, Office Space                                                                |   | Owned                                    |
| Silvolde, Netherlands            |   | 22,700/7,000                                      |   | Production, Office Space                                                                |   | Owned                                    |
| Stara Tura, Slovakia             |   | 55,103/20,912                                     |   | Production, Storage, Office Space, Research, Design & Development                   |   | Owned                                    |
| Essen, Germany                   |   | */1,774                                           |   | Headquarters                                                                            |   | Leased                                   |
| Lotte-Büren, Germany        |   | 112,500/25,800                                    |   | Research, Design & Development, Production, Distribution, Administration            |   | Owned                                    |
| Mainz-Kastel, Germany            |   | 55,996/24,368                                     |   | Research, Design & Development, Production, Distribution, Administration            |   | Owned                                    |
| Lampertheim, Germany (3)    |   | */9,099                                           |   | Research, Design & Development, Production, Office Space                       |   | Leased                                   |

| * | Not applicable for leased properties |
|---|--------------------------------------|

| (1) | Includes three buildings, two of which are used for office space (6,596 m2) and one used for production (10,683 m2). |
|-----|---------------------------------------------------------------------------------------------------------------------------|

| (2) | Includes buildings used for warehouses, office space and industrial manufacturing (6,456 m2) and a building for meter services (3,084 m2). |
|-----|--------------------------------------------------------------------------------------------------------------------------------------------|

| (3) | Includes a water tower. |
|-----|-------------------------|

----

| Corporate Name                |   | Country of Residence |   | Field of Activity  |   | Proportion of OurOwnership |   |
|------------------------------------|--------|--------------------------------|--------|------------------------------|--------|--------------------------------------|--------|
|                               |   |                           |   |                         |   |                                 |   |
| Elster American Meter Company, LLC |   | United States                  |   | Gas metering                 |   |                                 | 100    | % |
| Elster GmbH                        |   | Germany                        |   | Gas and electricity metering |   |                                 | 100    | % |
| Elster Holdings GmbH               |   | Germany                        |   | Holding company              |   |                                 | 100    | % |
| Elster Holdings US, Inc.      |   | United States                  |   | Holding company              |   |                                 | 100    | % |
| Elster s.r.o.                      |   | Slovakia                       |   | Water and gas metering       |   |                                 | 100    | % |

----

----

----

|   | · | In the United States, we generally use the unlicensed 902-928 MHz Industrial, Scientific and Medical (ISM) band in applications such as our EnergyAxis Local Area Network. Our products use 25 channels in this band. |
|--------|--------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | Our Wavenis technology allows operation in the European 868 MHz unlicensed band, the North American unlicensed 902-928 MHz ISM band and the licensed 400 MHz band in Europe, Asia and Australia. |
|--------|--------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | Our TRACE mobile technology uses the 400 MHz band. |
|--------|--------|---------------------------------------------------------|

----

----

----

----

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|     |   | Year Ended December 31, |    |
|----------|--------|----------------------------------------|---------|
|     |   | 2010                                   |    |   | 2009 |   |
|     |   | (in $ millions)              |    |
|     |   |                                   |    |
| Revenues |   |                                   | 1,759.3 |   |   |   | 1,695.1 |   |

----

|                   |   | Year Ended December 31, |    |
|------------------------|--------|----------------------------------------|---------|
|                   |   | 2010                                   |    |   | 2009 |   |
|                   |   | (in $ millions)              |    |
| North America          |   |                                   |    |   |   |   |
| United States          |   |                                   | 467.1   |   |   |   | 448.0 |   |
| Other North America    |   |                                   | 102.8   |   |   |   | 111.2 |   |
| Total                  |   |                                   | 569.9   |   |   |   | 559.2 |   |
| International          |   |                                   |    |   |   |   |   |   |
| Germany                |   |                                   | 239.0   |   |   |   | 256.0 |   |
| Europe outside Germany |   |                                   | 550.4   |   |   |   | 510.5 |   |
| Other                  |   |                                   | 400.0   |   |   |   | 369.4 |   |
| Total                  |   |                                   | 1,189.4 |   |   |   | 1,135.9 |   |
| Total                  |   |                                   | 1,759.3 |   |   |   | 1,695.1 |   |

----

|   | · | direct and indirect costs of raw materials and components; |
|--------|--------|------------------------------------------------------------|

|   | · | salaries, wages and indirect costs of labor, including the employer portion of social security and other payroll taxes; |
|--------|--------|-------------------------------------------------------------------------------------------------------------------------|

|   | · | temporary employees; |
|--------|--------|----------------------|

|   | · | warranty expenses; |
|--------|--------|--------------------|

|   | · | other overhead and infrastructure expenses to the extent these relate to our manufacturing; |
|--------|--------|---------------------------------------------------------------------------------------------|

|   | · | related depreciation and amortization; and |
|--------|--------|--------------------------------------------|

|   | · | restructuring charges to the extent they relate to our manufacturing. |
|--------|--------|-----------------------------------------------------------------------|

|             |   | Year Ended December 31, |    |
|------------------|--------|----------------------------------------|---------|
|             |   | 2010                                   |    | 2009 |   |
|             |   | in $ millions                |    | % of revenues |   | in $ millions |   | % of revenues |   |
| Cost of revenues |   |                                   | 1,208.6 |   | 68.7 |   |   | 1,191.3 |   | 70.3 |   |
| Gross profit     |   |                                   | 550.8   |   | 31.3 |   |   | 503.8 |   | 29.7 |   |

|   | · | We benefited from a shift towards higher margin products in our gas segment, in particular for our gas metering and gas utilization products. Additionally, our water segment recorded higher revenues in product groups with higher margins, such as our volumetric residential and C&I related products, compared to 2009. |
|--------|--------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | Manufacturing costs represented a lower percentage of our revenues in 2010 than in 2009 mainly due to the increase in capacity usage at our manufacturing facilities. |
|--------|--------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | We were able to realize the benefits of our ongoing initiative to improve the efficiency of our supply chain, including the outsourcing of sub-assemblies, particularly in North America and Europe. Many of these measures occurred during 2009 and our gross profit began to reflect the impact of these measures in 2010. Due to the completion of certain initiatives in 2009, reorganization expenses such as severance payments, early retirement and other compensationexpense to former employees as well as costs for the use of external services decreased significantly in 2010. This had a considerable positive impact on our gross margin. |
|--------|--------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | These positive developments were partially offset by the write down of inventory in connection with our decision to terminate our relationship with one of our distributors in our electricity segment. The net impact on gross profit was $9.2 million in 2010. In the first quarter of 2010, we decided to cease doing business with the distributor when we became aware that the distributor may have engaged in conduct on behalf of other parties for which it acted that,if engaged in on our behalf, could have violated our compliance policies. |
|--------|--------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

|   | · | salaries for personnel engaged in sales and marketing activities and the employer portion of social security and other payroll taxes; |
|--------|--------|---------------------------------------------------------------------------------------------------------------------------------------|

|   | · | shipping and handling costs; |
|--------|--------|------------------------------|

|   | · | commissions; |
|--------|--------|--------------|

|   | · | marketing and advertising expenses; |
|--------|--------|-------------------------------------|

|   | · | external services; |
|--------|--------|--------------------|

|   | · | overhead and infrastructure expenses; and |
|--------|--------|------------------------------------------------|

|   | · | related depreciation and amortization. |
|--------|--------|----------------------------------------|

|             |   | Year Ended December 31, |   |
|------------------|--------|----------------------------------------|--------|
|             |   | 2010                                   |   |   | 2009 |   |
|             |   | in $ millions                |   |   | % of revenues |   |   | in $ millions |   |   | % of revenues |   |
| Selling expenses |   |                                   | 165.5  |   |   |   | 9.4 |   |   |   | 159.4 |   |   |   | 9.4 |   |

|   | · | salaries, including the employer portion of social security and other payroll taxes, not allocated to other functional costs; |
|--------|--------|-------------------------------------------------------------------------------------------------------------------------------|

|   | · | until the completion of our IPO, expenses for our Management Equity Program, or MEP, an incentive program sponsored by our principal shareholder for some of our key management personnel; |
|--------|--------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | expenses relating to our preparation to become a public company; |
|--------|--------|------------------------------------------------------------------|

|   | · | other overhead costs not allocated to manufacturing, R&D and selling; |
|--------|--------|---------------------------------------------------------------------------|

|   | · | IT costs not allocated to other functional costs; |
|--------|--------|---------------------------------------------------|

|   | · | external services, professional services and consultancy fees; |
|--------|--------|----------------------------------------------------------------|

|   | · | banking fees; and |
|--------|--------|------------------------|

|   | · | related depreciation and amortization. |
|--------|--------|----------------------------------------|

----

|                                      |   | Year Ended December 31, |   |
|-------------------------------------------|--------|----------------------------------------|--------|
|                                      |   | 2010                                   |   | 2009 |   |
|                                      |   | in $ millions                |   | % of revenues |   | in $ millions |   | % of revenues |   |
| Management Equity Program                 |   |                                   | -13.6  |   | -0.8 |   |   | -33.3 |   | -2.0 |   |
| Other general and administrative expenses |   |                                   | 137.4  |   | 7.8 |   |   | 170.3 |   | 10.1 |   |
| Total general and administrative expenses |   |                                   | 123.8  |   | 7.0 |   |   | 137.0 |   | 8.1 |   |

|   | · | salaries for R&D personnel, including the employer portion of social security and other payroll taxes; |
|--------|--------|------------------------------------------------------------------------------------------------------------|

|   | · | external services; |
|--------|--------|--------------------|

|   | · | consulting expenses associated with R&D activities; |
|--------|--------|---------------------------------------------------------|

|   | · | depreciation and amortization of our R&D assets; and |
|--------|--------|---------------------------------------------------------------|

|   | · | other overhead and infrastructure cost associated with our R&D activities. |
|--------|--------|--------------------------------------------------------------------------------|

|                              |   | Year Ended December 31, |   |
|-----------------------------------|--------|----------------------------------------|--------|
|                              |   | 2010                                   |   | 2009 |   |
|                              |   | in $ millions                |   | % of revenues |   | in $ millions |   | % of revenues |   |
| Research and development expenses |   |                                   | 87.5   |   | 5.0 |   |   | 78.4 |   | 4.6 |   |

----

|                                  |   | Year Ended December 31, |   |
|---------------------------------------|--------|----------------------------------------|--------|
|                                  |   | 2010                                   |   | 2009 |   |
|                                  |   | in $ millions                |   | % of revenues |   | in $ millions |   | % of revenues |   |
| Other operating income (expense), net |   |                                   | 2.1    |   | 0.1 |   |   | 14.8 |   | 0.9 |   |

|                  |   | Year Ended December 31, |   |
|-----------------------|--------|----------------------------------------|--------|
|                  |   | 2010                                   |   | 2009 |   |
|                  |   | in $ millions                |   | % of revenues |   | in $ millions |   | % of revenues |   |
| Interest expense, net |   |                                   | 60.1   |   | 3.4 |   |   | 55.4 |   | 3.3 |   |

|              |   | Year Ended December 31, |   |
|-------------------|--------|----------------------------------------|--------|
|              |   | 2010                                   |   | 2009 |   |
|              |   | in $ millions                |   | % of revenues |   | in $ millions |   | % of revenues |   |
| Other income, net |   |                                   | 3.0    |   | 0.2 |   |   | 3.3 |   | 0.2 |   |

|               |   | Year Ended December 31, |   |
|--------------------|--------|----------------------------------------|--------|
|               |   | 2010                                   |   | 2009 |   |
|               |   | in $ millions                |   | % of revenues |   | in $ millions |   | % of revenues |   |
| Income tax expense |   |                                   | 29.4   |   | 1.7 |   |   | 39.3 |   | 2.3 |   |

----

|               |   | Year ended December 31, |   |
|--------------------|--------|----------------------------------------|--------|
|               |   | 2010                                   |   |   | 2009 |   |
|               |   | %                                      |   |   | % |   |
| Effective Tax Rate |   |                                   | 24.7   |   |   |   | 42.9 |   |

|                                    |   | Year Ended December 31, |   |
|-----------------------------------------|--------|----------------------------------------|--------|
|                                    |   | 2010                                   |   | 2009 |   |
|                                    |   | in $ millions                |   | % of revenues |   | in $ millions |   | % of revenues |   |
| Net income from discontinued operations |   |                                   | 2.6    |   | 0.1 |   |   | 0.0 |   | 0.0 |   |

|              |   | Year Ended December 31, |   |
|-------------------|--------|----------------------------------------|--------|
|              |   | 2010                                   |   | 2009 |   |
|              |   | in $ millions                |   | % of revenues |   | in $ millions |   | % of revenues |   |
| Net income (loss) |   |                                   | 92.0   |   | 5.2 |   |   | 52.3 |   | 3.1 |   |

|            |   | Year Ended December 31, |   |
|-----------------|--------|----------------------------------------|--------|
|            |   | 2010                                   |   | 2009 |   |
|            |   | in $ millions                |   | % of revenues |   | in $ millions |   | % of revenues |   |
| Adjusted EBITDA |   |                                   | 285.0  |   | 16.2 |   |   | 264.1 |   | 15.6 |   |

----

|                          |   | Gas                                    |   |   | Electricity |   |   | Water  |   |
|-------------------------------|--------|----------------------------------------|--------|--------|-------------|--------|--------|--------|--------|
|                          |   | Year Ended December 31, |   |
|                          |   | 2010                                   |   |   | 2009        |   |   | 2010   |   |   | 2009 |   |   | 2010 |   |   | 2009 |   |
|                          |   | (in $ millions)                        |   |
| Total revenues                |   |                                   | 943.8  |   |        |   | 899.8  |   |   |   | 451.5 |   |   |   | 453.1 |   |   |   | 383.9 |   |   |   | 355.9 |   |
| thereof to external customers |   |                                   | 941.4  |   |        |   | 898.1  |   |   |   | 437.7 |   |   |   | 445.1 |   |   |   | 380.2 |   |   |   | 352.0 |   |
| thereof to other segments     |   |                                   | 2.3    |   |        |   | 1.7    |   |   |   | 13.8 |   |   |   | 8.0 |   |   |   | 3.7 |   |   |   | 3.9 |   |
| Segment profit                |   |                                   | 230.2  |   |        |   | 204.0  |   |   |   | 55.9 |   |   |   | 60.4 |   |   |   | 35.4 |   |   |   | 30.4 |   |

----

----

----

|     |   | Year Ended December 31, |    |
|----------|--------|----------------------------------------|---------|
|     |   | 2009                                   |    |   | 2008 |   |
|     |   | (in $ millions)              |    |
|     |   |                                   |    |
| Revenues |   |                                   | 1,695.1 |   |   |   | 1,904.5 |   |

----

|                   |   | Year Ended December 31, |    |
|------------------------|--------|----------------------------------------|---------|
|                   |   | 2009                                   |    |   | 2008 |   |
|                   |   | (in $ millions)              |    |
| North America          |   |                                   |    |   |   |   |
| United States          |   |                                   | 448.0   |   |   |   | 440.9 |   |
| Other North America    |   |                                   | 111.2   |   |   |   | 92.0 |   |
| Total                  |   |                                   | 559.2   |   |   |   | 532.9 |   |
| International          |   |                                   |    |   |   |   |   |   |
| Germany                |   |                                   | 256.0   |   |   |   | 309.0 |   |
| Europe outside Germany |   |                                   | 510.5   |   |   |   | 641.3 |   |
| Other                  |   |                                   | 369.4   |   |   |   | 421.3 |   |
| Total                  |   |                                   | 1,135.9 |   |   |   | 1,371.6 |   |
| Total                  |   |                                   | 1,695.1 |   |   |   | 1,904.5 |   |

|             |   | Year Ended December 31, |    |
|------------------|--------|----------------------------------------|---------|
|             |   | 2009                                   |    | 2008 |   |
|             |   | in $ millions                |    | % of revenues |   | in $ millions |   | % of revenues |   |
| Cost of revenues |   |                                   | 1,191.3 |   | 70.3 |   |   | 1,306.3 |   | 68.6 |   |
| Gross profit     |   |                                   | 503.8   |   | 29.7 |   |   | 598.2 |   | 31.4 |   |

----

|   | · | As a consequence of the Smart Offerings driven growth in our electricity segment, coupled with revenue declines in our gas segment due to macroeconomic conditions, we experienced a shift in our mix of products towards our electricity segment during 2009. Our electricity segment products, particularly during the design, development and expansion phases of new technologies, have been characterized by lower margins than those of our gas business. |
|--------|--------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | Volatile prices for raw materials also negatively affected our gross margin. The prices we paid for raw materials, including brass, steel and aluminum, fell significantly during the second half of 2008 as a result of the global economic downturn. In an effort to reduce our exposure to commodity price fluctuations, we entered into supply contracts with some of our suppliers at fixed prices, in some cases before the price for these materials declined. These contracts locked us into fixed prices in early 2009 as market prices decreased. We entered into replacements for most of these contracts during the course of 2009, fixing lower supply costs for many of these raw materials. We expect to benefit from these lower contract prices if raw material prices become volatile and increase in 2010. |
|--------|--------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | We incurred restructuring and employee termination expenses in 2009. As part of our initiative to improve the efficiency of our supply chain, including the outsourcing of sub-assemblies, we restructured some of our facilities, most of which were in Europe and North America. As these initiatives occurred during 2009, our gross profit does not reflect the full-year impact of the results of these restructuring activities. |
|--------|--------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | Manufacturing costs represented a higher percentage of revenues in 2009 than in 2008 as a result of the decline in capacity utilization in our manufacturing facilities. |
|--------|--------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | In 2008 we made significant investments in technical equipment and machinery at our sites in connection with our improvement initiatives. As a result, depreciation on manufacturing equipment increased in 2009 compared to 2008. |
|--------|--------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|             |   | Year Ended December 31, |   |
|------------------|--------|----------------------------------------|--------|
|             |   | 2009                                   |   |   | 2008 |   |
|             |   | in $ millions                |   |   | % of revenues |   |   | in $ millions |   |   | % of revenues |   |
| Selling expenses |   |                                   | 159.4  |   |   |   | 9.4 |   |   |   | 183.4 |   |   |   | 9.6 |   |

----

|                                      |   | Year Ended December 31, |   |
|-------------------------------------------|--------|----------------------------------------|--------|
|                                      |   | 2009                                   |   | 2008 |   |
|                                      |   | in $ millions                |   | % of revenues |   | in $ millions |   | % of revenues |   |
| Management Equity Program                 |   |                                   | -33.3  |   | -2.0 |   | 90.7 |   | 4.8 |   |
| Other general and administrative expenses |   |                                   | 170.3  |   | 10.1 |   | 155.8 |   | 8.1 |   |
| Total general and administrative expenses |   |                                   | 137.0  |   | 8.1 |   | 246.5 |   | 12.9 |   |

|                              |   | Year Ended December 31, |   |
|-----------------------------------|--------|----------------------------------------|--------|
|                              |   | 2009                                   |   |   | 2008 |   |
|                              |   | in $ millions                |   |   | % of revenues |   |   | in $ millions |   |   | % of revenues |   |
| Research and development expenses |   |                                   | 78.4   |   |   |   | 4.6 |   |   |   | 70.7 |   |   |   | 3.7 |   |

----

|                                  |   | Year Ended December 31, |   |
|---------------------------------------|--------|----------------------------------------|--------|
|                                  |   | 2009                                   |   |   | 2008 |   |
|                                  |   | in $ millions                |   |   | % of revenues |   |   | in $ millions |   |   | % of revenues |   |
| Other operating income (expense), net |   |                                   | 14.8   |   |   |   | 0.9 |   |   |   | -39.5 |   |   |   | -2.1 |   |

|                  |   | Year Ended December 31, |   |
|-----------------------|--------|----------------------------------------|--------|
|                  |   | 2009                                   |   |   | 2008 |   |
|                  |   | in $ millions                |   |   | % of revenues |   |   | in $ millions |   |   | % of revenues |   |
| Interest expense, net |   |                                   | 55.4   |   |   |   | 3.3 |   |   |   | 117.3 |   |   |   | 6.2 |   |

----

|              |   | Year Ended December 31, |   |
|-------------------|--------|----------------------------------------|--------|
|              |   | 2009                                   |   |   | 2008 |   |
|              |   | in $ millions                |   |   | % of revenues |   |   | in $ millions |   |   | % of revenues |   |
| Other income, net |   |                                   | 3.3    |   |   |   | 0.2 |   |   |   | 2.9 |   |   |   | 0.2 |   |

|               |   | Year Ended December 31, |   |
|--------------------|--------|----------------------------------------|--------|
|               |   | 2009                                   |   |   | 2008 |   |
|               |   | in $ millions                |   |   | % of revenues |   |   | in $ millions |   |   | % of revenues |   |
| Income tax expense |   |                                   | 39.3   |   |   |   | 2.3 |   |   |   | 30.9 |   |   |   | 1.6 |   |

|               |   | Year Ended December 31, |   |
|--------------------|--------|----------------------------------------|--------|
|               |   | 2009                                   |   |   | 2008 |   |
|               |   | %                                      |   |   | % |   |
| Effective Tax Rate |   |                                   | 42.9   |   |   |   | -55.0 | (1) |

| (1)  | The negative tax rate in 2008 refers to the fact that we recorded income taxes despite having incurred a loss from continuing operations before taxes. The $30.9 million in income taxes for 2008 was equal to -55.0% of our income from continuing operations before income taxes. For the calculation of our effective tax rates, see Note 7 to our consolidated financial statements included elsewhere in this annual report. |
|-----------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|              |   | Year Ended December 31, |   |
|-------------------|--------|----------------------------------------|--------|
|              |   | 2009                                   |   |   | 2008 |   |
|              |   | in $ millions                |   |   | % of revenues |   |   | in $ millions |   |   | % of revenues |   |
| Net income (loss) |   |                                   | 52.3   |   |   |   | 3.1 |   |   |   | -87.1 |   |   |   | -4.6 |   |

----

|            |   | Year Ended December 31, |   |
|-----------------|--------|----------------------------------------|--------|
|            |   | 2009                                   |   |   | 2008 |   |
|            |   | in $ millions                |   |   | % of revenues |   |   | in $ millions |   |   | % of revenues |   |
| Adjusted EBITDA |   |                                   | 264.1  |   |   |   | 15.6 |   |   |   | 314.6 |   |   |   | 16.5 |   |

|                          |   | Gas                                    |   |   | Electricity |   |    | Water  |   |
|-------------------------------|--------|----------------------------------------|--------|--------|-------------|--------|---------|--------|--------|
|                          |   | Year Ended December 31, |   |
|                          |   | 2009                                   |   |   | 2008        |   |    | 2009   |   |   | 2008 |   |   | 2009 |   |   | 2008 |   |
|                          |   | (in $ millions)                        |   |
| Total revenues                |   |                                   | 899.8  |   |        |   | 1,129.4 |   |   |   | 453.1 |   |   |   | 404.1 |   |   |   | 355.9 |   |   |   | 384.0 |   |
| thereof to external customers |   |                                   | 898.1  |   |        |   | 1,127.4 |   |   |   | 445.1 |   |   |   | 395.4 |   |   |   | 352.0 |   |   |   | 381.7 |   |
| thereof to other segments     |   |                                   | 1.7    |   |        |   | 2.0     |   |   |   | 8.0 |   |   |   | 8.7 |   |   |   | 3.9 |   |   |   | 2.3 |   |
| Segment profit                |   |                                   | 204.0  |   |        |   | 264.1   |   |   |   | 60.4 |   |   |   | 35.0 |   |   |   | 30.4 |   |   |   | 32.3 |   |

----

----

----

|   | · | foreign currency exchange effects; |
|--------|--------|------------------------------------|

|   | · | the management equity program, or MEP; |
|--------|--------|----------------------------------------|

|   | · | expenses for our preparation to become a public company; |
|--------|--------|----------------------------------------------------------|

|   | · | employee termination and exit costs; |
|--------|--------|--------------------------------------|

|   | · | business process reengineering and reorganization costs; |
|--------|--------|----------------------------------------------------------|

|   | · | IT project costs; |
|--------|--------|-------------------|

|   | · | gain from sales of real estate; |
|--------|--------|---------------------------------|

|   | · | strategy development costs; |
|--------|--------|-----------------------------|

|   | · | business combination costs; |
|--------|--------|-----------------------------|

|   | · | impairment of intangible assets; |
|--------|--------|----------------------------------|

|   | · | effects of termination of a distributor; and |
|--------|--------|---------------------------------------------------|

|   | · | other items. |
|--------|--------|--------------|

----

|   | · | As part of our consolidation each period, we translate the financial statements of those entities in our group that have functional currencies other than the dollar into dollars at the period-end exchange rates (in the case of balance sheet items) and the average exchange rates for the period (in the case of statement of operations items). The translated values in respect of each entity fluctuate over time with the movement of the exchange rate for the entity's functional currency against the dollar. We refer to this as the currency translation effect. It is not practicable to hedge against this risk. |
|--------|--------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | Most of our group companies make their purchases and sales primarily in their respective functional currencies. However, entities within the group make sometimes purchases and sales denominated in currencies other than their functional currencies. To the extent that an entity makes purchases in a currency that appreciates against its functional currency, its cost basis expressed in its functional currency will increase, or decrease, if the other currency depreciates against its functional currency. Similarly, for sales in a currency other than the entity's functional currency, its revenues will increase to the extent that the other currency appreciates against the entity's functional currency and decrease to the extent that currency depreciates against the entity's functional currency. These movements can have a material effect on the gross margin of the entity concerned and on ourconsolidated gross margin. |
|--------|--------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | After a purchase or sale is completed, the currency transaction effect continues to affect foreign currency accounts payable and accounts receivable on the books of those entities that made purchases or sales in a foreign currency. These entities are required to remeasure these balances at market exchange rates at the end of each period. In 2008, we incurred a foreign currency loss of $7.4 million resulting from these remeasurements; in 2009 we recognized a gain of $2.9 million and in 2010, we incurred a gain of $2.3 million. We intend, through our group treasury function, to enter into foreign currency derivative financial products to mitigate exchange rate losses when the appropriate financial products are available on attractive terms. However, it is often economically disadvantageous to pay the costs associated with hedging against every possible currency movement,particularly between currencies that have traditionally been rather stable, and we will continue to be subject to this risk. |
|--------|--------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

|                                                      |   | Year Ended December 31, |   |
|-----------------------------------------------------------|--------|----------------------------------------|--------|
|                                                      |   | 2010                                   |   |   | 2009 |   |   | 2008 |   |
|                                                      |   | (in $ millions)              |   |
| Gains (losses) related to financing                       |   |                                   | 0.6    |   |   |   | 11.5 |   |   |   | -37.8 |   |
| Gains (losses) related to accounts receivable and payable |   |                                   | 2.3    |   |   |   | 2.9 |   |   |   | -7.4 |   |
| Foreign currency exchange effects                         |   |                                   | 2.9    |   |   |   | 14.4 |   |   |   | -45.2 |   |

|                      |   | Year Ended December 31, |   |
|---------------------------|--------|----------------------------------------|--------|
|                      |   | 2010                                   |   |   | 2009 |   |   | 2008 |   |
|                      |   | (in $ millions)              |   |
| Management Equity Program |   |                                   | -13.6  |   |   |   | -33.3 |   |   |   | 90.7 |   |

----

|                                                |   | Year Ended December 31, |   |
|-----------------------------------------------------|--------|----------------------------------------|--------|
|                                                |   | 2010                                   |   |   | 2009 |   |   | 2008 |   |
|                                                |   | (in $ millions)              |   |
| Expenses for Preparation to Become a Public Company |   |                                   | 12.7   |   |   |   | 23.0 |   |   |   | 7.0 |   |

|                                |   | Year Ended December 31, |   |
|-------------------------------------|--------|----------------------------------------|--------|
|                                |   | 2010                                   |   |   | 2009 |   |   | 2008 |   |
|                                |   | (in $ millions)              |   |
| Employee termination and exit costs |   |                                   | 6.2    |   |   |   | 25.4 |   |   |   | 10.5 |   |

----

|                                                    |   | Year Ended December 31, |   |
|---------------------------------------------------------|--------|----------------------------------------|--------|
|                                                    |   | 2010                                   |   |   | 2009 |   |   | 2008 |   |
|                                                    |   | (in $ millions)              |   |
| Business process reengineering and reorganization costs |   |                                   | 5.9    |   |   |   | 16.8 |   |   |   | 3.2 |   |

----

|                                    |   | Year Ended December 31, |   |
|-----------------------------------------|--------|----------------------------------------|--------|
|                                    |   | 2010                                   |   |   | 2009 |   |   | 2008 |   |
|                                    |   | (in $ millions)              |   |
| Strategy development costs              |   |                                   | 0.3    |   |   |   | 3.6 |   |   |   | 7.8 |   |
| IT project costs                        |   |                                   | 1.9    |   |   |   | 8.6 |   |   |   | 3.6 |   |
| Gain (loss) from sale of real estate    |   |                                   | 0.0    |   |   |   | -2.5 |   |   |   | -0.8 |   |
| Business combination costs              |   |                                   | 0.0    |   |   |   | 1.8 |   |   |   | 0.0 |   |
| Impairment of intangible assets         |   |                                   | 0.0    |   |   |   | 2.3 |   |   |   | 1.3 |   |
| Effects of termination of a distributor |   |                                   | 9.8    |   |   |   | 0.0 |   |   |   | 0.0 |   |
| Other                                   |   |                                   | 0.3    |   |   |   | 0.3 |   |   |   | -0.2 |   |
| Total                                   |   |                                   | 12.3   |   |   |   | 14.1 |   |   |   | 11.7 |   |

----

|                                                    |   | Year Ended December 31, |   |
|---------------------------------------------------------|--------|----------------------------------------|--------|
|                                                    |   | 2010                                   |   |   | 2009 |   |   | 2008 |   |
|                                                    |   | (in $ millions)              |   |
| Net income (loss)                                       |   |                                   | 92.0   |   |   |   | 52.3 |   |   |   | -87.1 |   |
| Income tax expense                                      |   |                                   | 29.4   |   |   |   | 39.3 |   |   |   | 30.9 |   |
| Interest expenses, net                                  |   |                                   | 60.1   |   |   |   | 55.4 |   |   |   | 117.3 |   |
| Depreciation and amortization                           |   |                                   | 85.5   |   |   |   | 85.4 |   |   |   | 85.3 |   |
| Gain on disposal of discontinued operations             |   |                                   | -2.6   |   |   |   | 0.0 |   |   |   | 0.0 |   |
| Foreign currency exchange effects                       |   |                                   | -2.9   |   |   |   | -14.4 |   |   |   | 45.1 |   |
| Management equity program                               |   |                                   | -13.6  |   |   |   | -33.3 |   |   |   | 90.7 |   |
| Expenses for preparation to become a public company     |   |                                   | 12.7   |   |   |   | 23.0 |   |   |   | 7.0 |   |
| Strategy development costs                              |   |                                   | 0.3    |   |   |   | 3.6 |   |   |   | 7.8 |   |
| Employee termination and exit costs                     |   |                                   | 6.2    |   |   |   | 25.4 |   |   |   | 10.5 |   |
| Business process reengineering and reorganization costs |   |                                   | 5.9    |   |   |   | 16.8 |   |   |   | 3.2 |   |
| IT project cost                                         |   |                                   | 1.9    |   |   |   | 8.6 |   |   |   | 3.6 |   |
| Gain (loss) from sale of real estate                    |   |                                   | 0.0    |   |   |   | -2.5 |   |   |   | -0.8 |   |
| Effects of termination of a distributor                 |   |                                   | 9.8    |   |   |   | 0.0 |   |   |   | 0.0 |   |
| Business combination cost                               |   |                                   | 0.0    |   |   |   | 1.7 |   |   |   | 0.0 |   |
| Impairment of intangible assets                         |   |                                   | 0.0    |   |   |   | 2.3 |   |   |   | 1.3 |   |
| Other                                                   |   |                                   | 0.3    |   |   |   | 0.3 |   |   |   | -0.2 |   |
| Adjusted EBITDA                                         |   |                                   | 285.0  |   |   |   | 264.1 |   |   |   | 314.6 |   |

----

|                                                              |   | Year Ended December 31, |   |
|-------------------------------------------------------------------|--------|----------------------------------------|--------|
|                                                              |   | 2010                                   |   |   | 2009 |   |   | 2008 |   |
|                                                              |   | (in $ millions)              |   |
| Cash flows from operating activities                              |   |                                   | 141.3  |   |   |   | 119.6 |   |   |   | 114.1 |   |
| Income taxes paid                                                 |   |                                   | 28.7   |   |   |   | 42.7 |   |   |   | 50.6 |   |
| Interest paid                                                     |   |                                   | 50.1   |   |   |   | 45.4 |   |   |   | 74.1 |   |
| Dividends from equity method investees, net of equity in earnings |   |                                   | -2.3   |   |   |   | -2.2 |   |   |   | -1.7 |   |
| Expenses for preparation to become a public company               |   |                                   | 12.7   |   |   |   | 23.0 |   |   |   | 7.0 |   |
| Strategy development costs                                        |   |                                   | 0.3    |   |   |   | 3.6 |   |   |   | 7.8 |   |
| Employee termination and exit costs                               |   |                                   | 6.2    |   |   |   | 25.4 |   |   |   | 10.5 |   |
| Business process reengineering and reorganization costs           |   |                                   | 5.9    |   |   |   | 16.8 |   |   |   | 3.2 |   |
| IT projects costs                                                 |   |                                   | 1.9    |   |   |   | 8.6 |   |   |   | 3.6 |   |
| Other                                                             |   |                                   | 0.3    |   |   |   | 0.3 |   |   |   | -0.2 |   |
| Increase (decrease) in all other assets and liabilities, net      |   |                                   | 39.9   |   |   |   | -19.1 |   |   |   | 45.6 |   |
| Adjusted EBITDA                                                   |   |                                   | 285.0  |   |   |   | 264.1 |   |   |   | 314.6 |   |

|   | · | before taking into account any accrued interest, commission, fees, discounts and other finance payments incurred or payable by or owed to any member of the Elster Group in respect of financial indebtedness; |
|--------|--------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

|   | · | after deducting the amount of any profit of any member of the Elster Group that is attributable to minority interests or the interests of any shareholder of or, as the case may be, partner in such member of the Elster Group who is not a member of the Elster Group; |
|--------|--------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | after taking into account any exchange gains and losses on operational trading and hedges relating to these items, but not taking into account any other realized and unrealized exchange gains and losses (including those arising on translation of currency debt); |
|--------|--------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | before taking into account any gain or loss arising from an upward or downward revaluation of any asset or on the disposal of an asset; |
|--------|--------|-----------------------------------------------------------------------------------------------------------------------------------------|

|   | · | plus any loss on any one-off or non-recurring items; |
|--------|--------|------------------------------------------------------|

|   | · | minus any gain on any one-off or non-recurring items; |
|--------|--------|-------------------------------------------------------|

|   | · | before deducting reorganization and litigation costs that are incurred and included in the base case model and any additional permitted reorganization; |
|--------|--------|---------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | before deducting any fees, costs, expenses and taxes incurred in connection with the preparation of the finance documents, including the Senior Facilities Agreement, as well shareholders' agreements and other documents relating to the acquisition of Ruhrgas Industries GmbH; |
|--------|--------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | before deducting non-cash pension costs (including service costs and pension interest costs) but after deducting cash pension costs (we do not make this adjustment under U.S. GAAP); |
|--------|--------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | plus any fees, costs or charges of a non-recurring nature related to any equity offering, investments, acquisitions or financial indebtedness permitted under the finance documents (and whether or not successful); and |
|--------|--------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | plus any management fees paid to funds advised by CVC and holding company costs where permitted to be paid under the finance documents, |
|--------|--------|-----------------------------------------------------------------------------------------------------------------------------------------|

----

|   | · | the cash portion of our net interest expense, our income tax benefit or provision and our restructuring charges, as well as the charges related to our IPO, and the other items for which we make adjustments in calculating Adjusted EBITDA, generally represent charges or gains that may significantly affect funds available to use in our operating, investing and financing activities; |
|--------|--------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | foreign exchange gains (losses), although not immediately affecting cash when recorded, may affect the amount of funds we receive from our customers or the amount of funds we need to pay our suppliers or service our debt because we expect foreign currency effects to continue in the future; and |
|--------|--------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | depreciation, amortization, and impairment charges, though not directly affecting our current cash position, represent the wear and tear and/or reduction in value of the plant, equipment and intangible assets which permit us to manufacture and/or market our products. These non-cash items may nevertheless be indicative of future needs for capital expenditures, for development or acquisition of intangible assets or for an understanding of relevant trends causing asset value changes. |
|--------|--------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

----

|                                                            |   | Year Ended December 31, |   |
|-----------------------------------------------------------------|--------|----------------------------------------|--------|
|                                                            |   | 2010                                   |   |   | 2009 |   |   | 2008 |   |
|                                                            |   | (in $ millions)                        |   |
| Net income (loss)                                               |   |                                   | 92.0   |   |   |   | 52.3 |   |   |   | -87.1 |   |
| Amortization of purchase price allocation                       |   |                                   | 33.1   |   |   |   | 33.7 |   |   |   | 34.7 |   |
| Less: income taxes on amortization of purchase price allocation |   |                                   | -10.7  |   |   |   | -11.0 |   |   |   | -11.1 |   |
| Net income (loss) before amortization of PPA                    |   |                                   | 114.4  |   |   |   | 75.0 |   |   |   | -63.5 |   |

|                                               |   | Year Ended December 31, |   |
|----------------------------------------------------|--------|----------------------------------------|--------|
|                                               |   | 2010                                   |   |   | 2009 |   |   | 2008 |   |
|                                               |   | (in $ millions)              |   |
| Cash flows from operating activities               |   |                                   | 141.3  |   |   |   | 119.6 |   |   |   | 114.1 |   |
| Net cash flow from (used in) investing activitites |   |                                   | -28.0  |   |   |   | -43.0 |   |   |   | -79.0 |   |
| Net cash flow from (used in) financing activitites |   |                                   | 25.4   |   |   |   | -77.4 |   |   |   | -8.7 |   |
| Effect of exchange rate fluctuations on cash held  |   |                                   | 2.1    |   |   |   | 2.0 |   |   |   | -5.5 |   |
| Cash and cash equivalents at the end of the period |   |                                   | 216.3  |   |   |   | 75.4 |   |   |   | 74.3 |   |

----

----

|                                                            |   | Year Ended December 31, |   |
|-----------------------------------------------------------------|--------|----------------------------------------|--------|
|                                                            |   | 2010                                   |   |   | 2009 |   |   | 2008 |   |
|                                                            |   | (in $ millions)              |   |
| Cash flows from operating activities                            |   |                                   | 141.3  |   |   |   | 119.6 |   |   |   | 114.1 |   |
| Purchase of property, plant and equipment and intangible assets |   |                                   | 42.4   |   |   |   | 30.5 |   |   |   | 81.8 |   |
| Free cash flow                                                  |   |                                   | 98.9   |   |   |   | 89.1 |   |   |   | 32.3 |   |

|   | · | finance our operations; |
|--------|--------|-------------------------|

|   | · | make scheduled interest and principal payments on our debt; |
|--------|--------|-------------------------------------------------------------|

|   | · | make planned capital expenditures; and |
|--------|--------|---------------------------------------------|

|   | · | settle contingencies, if and when they occur. |
|--------|--------|-----------------------------------------------|

|   | · | cash flow generated from operations; |
|--------|--------|--------------------------------------|

|   | · | cash and cash equivalents on hand; |
|--------|--------|------------------------------------|

|   | · | available undrawn credit facilities; and |
|--------|--------|-----------------------------------------------|

|   | · | capital market and other financing transactions in which we may engage in the future. |
|--------|--------|---------------------------------------------------------------------------------------|

----

|                        |   | As of December 31, 2010 |   |
|-----------------------------|--------|---------------------------------------------|--------|
|                        |   | Total                                       |   |   | Less than 1Year |   |   | 1 to LessThan 3Years |   |   | 3-5Years |   |   | More than 5Years |   |
|                        |   | (in $ millions)                   |   |
| Long-term debt obligations  |   |                                        | 840.0  |   |   |   | 17.7 |   |   |   | 447.5 |   |   |   | 374.8 |   |   |   | 0.0 |   |
| Capital lease obligations   |   |                                        | 0.4    |   |   |   | 0.3 |   |   |   | 0.1 |   |   |   | 0.0 |   |   |   | 0.0 |   |
| Operating lease obligations |   |                                        | 20.9   |   |   |   | 5.6 |   |   |   | 8.5 |   |   |   | 3.3 |   |   |   | 3.5 |   |
| Purchase obligations        |   |                                        | 0.1    |   |   |   | 0.1 |   |   |   | 0.0 |   |   |   | 0.0 |   |   |   | 0.0 |   |
| Income tax payables         |   |                                        | 35.2   |   |   |   | 17.9 |   |   |   | 7.7 |   |   |   | 6.1 |   |   |   | 3.5 |   |
| Total                       |   |                                        | 896.6  |   |   |   | 41.6 |   |   |   | 463.8 |   |   |   | 384.2 |   |   |   | 7.0 |   |

|   | · | a senior tranche A term loan facility, in a maximum aggregate amount of €220 million which we repaid in full following our IPO and the last scheduled repayment of £1.5m ($2.3m) on December 31, 2010; |
|--------|--------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

|   | · | a senior tranche B term loan facility, in a maximum aggregate amount of €222.5 million and which had an outstanding aggregate principal amount of €95.2 million and $115.0 million ($242.2 million total) as of December 31, 2010; |
|--------|--------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | a senior tranche B-1 term loan facility, in a maximum aggregate amount of €202.5 million and which had an outstanding aggregate principal amount of €99.2 million ($132.6 million total) as of December 31, 2010; |
|--------|--------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | a senior tranche C term loan facility, in a maximum aggregate amount of €222.5 million and which had an outstanding aggregate principal amount of €95.2 million and $115.0 million ($242.2 million total) as of December 31, 2010; |
|--------|--------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | a senior tranche C-1 term loan facility, in a maximum aggregate amount of €202.5 million and which had an outstanding aggregate principal amount of €99.2 million ($132.6 million total) as of December 31, 2010; |
|--------|--------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | a bonding facility available in various currencies up to a maximum aggregate principal amount of €140 million of which €79.5 million ($106.2 million) was outstanding as of December 31, 2010; and |
|--------|--------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | a revolving facility available in various currencies up to a maximum aggregate principal amount of €150 million of which £41.9 million and €5.6 million ($72.6 million) was outstanding as of December 31, 2010.  |
|--------|--------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

| Total leverage ratio                       |   | Revolving Facilityand Bonding Facility |   |
|------------------------------------------------------|--------|--------------------------------------------------|--------|
|                                                 |   | in %                                             |   |
| Greater than 4.50:1                                  |   |                                             | 2.25   |   |
| Equal to or less than 4.50:1 but greater than 4.00:1 |   |                                             | 1.75   |   |
| Equal to or less than 4.00:1 but greater than 3.50:1 |   |                                             | 1.75   |   |
| Equal to or less than 3.50:1 but greater than 3.00:1 |   |                                             | 1.50   |   |
| Equal to or less than 3.00:1                         |   |                                             | 1.25   |   |

|                                                 |   | Tranche B andTranche B-1 TermLoan facilities |   |
|------------------------------------------------------|--------|-----------------------------------------------------------------------|--------|
|                                                 |   | in %                                                                  |   |
| Greater than 4.50:1                                  |   |                                                                  | 2.50   |   |
| Equal to or less than 4.50:1 but greater than 4.00:1 |   |                                                                  | 2.25   |   |
| Equal to or less than 4.00:1                         |   |                                                                  | 2.00   |   |

| Total leverage ratio                       |   | Additional MarginAdjustment forEach Facility |   |
|------------------------------------------------------|--------|-------------------------------------------------------------|--------|
|                                                 |   | in %                                                        |   |
| Greater than 2.50:1                                  |   |                                                        | 0.75   |   |
| Equal to or less than 2.50:1 but greater than 2.25:1 |   |                                                        | 0.50   |   |
| Equal to or less than 2.25:1 but greater than 2.00:1 |   |                                                        | 0.25   |   |
| Equal to or less than 2.00:1                         |   | No change                                                   |   |

----

|                                           |   | Effective interest rate as of December 31, |   |
|------------------------------------------------|--------|--------------------------------------------------------------------------|--------|
|                                           |   | 2010                                                                     |   |   | 2009 |   |   | 2008 |   |
|                                           |   | in %                                                                     |   |   | in % |   |   | in % |   |
| Facility                                       |   |                                                                     |   |   |   |   |   |   |   |
|                                           |   |                                                                     |   |   |   |   |   |   |   |
| Tranche A Term Loan Facility                   |   |                                                                     |   |   |   |   |   |   |   |
| - EUR denominated                              |   |                                                                     | (1     | ) |   |   | 2.30 |   |   |   | 4.14 |   |
| - GBP denominated                              |   |                                                                     |   |   |   |   | 2.20 |   |   |   | 3.67 |   |
| Tranche B and Tranche B-1 Term Loan Facilities |   |                                                                     |   |   |   |   |   |   |   |   |   |   |
| - EUR denominated                              |   |                                                                     | 3.03   |   |   |   | 2.80 |   |   |   | 4.87 |   |
| - USD denominated                              |   |                                                                     | 2.30   |   |   |   | 2.29 |   |   |   | 2.58 |   |
| Tranche C and Tranche C-1 Term Loan Facilities |   |                                                                     |   |   |   |   |   |   |   |   |   |   |
| - EUR denominated                              |   |                                                                     | 3.53   |   |   |   | 3.30 |   |   |   | 5.37 |   |
| - USD denominated                              |   |                                                                     | 2.80   |   |   |   | 2.79 |   |   |   | 3.08 |   |

| (1) | There were no amounts outstanding under Tranche A Term Loan Facility as of December 31, 2010.  |
|-----|---------------------------------------------------------------------------------------------------------------|

----

|   | · | engage in mergers or consolidations; |
|--------|--------|--------------------------------------|

|   | · | change the nature of our business; |
|--------|--------|------------------------------------|

|   | · | sell, transfer, lease or otherwise dispose of assets, including receivables; |
|--------|--------|------------------------------------------------------------------------------|

|   | · | enter into certain non arm’s length transactions; |
|--------|--------|---------------------------------------------------------|

|   | · | grant liens or other security interests on our assets; |
|--------|--------|--------------------------------------------------------|

|   | · | grant guarantees; |
|--------|--------|-------------------|

|   | · | make investments, loans or grant credit; |
|--------|--------|------------------------------------------|

|   | · | enter into certain finance leases, hire purchase, conditional sale agreement or other agreements for the acquisition of assets upon deferred payment terms; |
|--------|--------|-------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | enter into certain hedging transactions; |
|--------|--------|------------------------------------------|

|   | · | enter into certain joint ventures; |
|--------|--------|------------------------------------|

|   | · | make certain acquisitions; |
|--------|--------|----------------------------|

|   | · | move our center of main interest; |
|--------|--------|-----------------------------------|

|   | · | issue shares or other securities; |
|--------|--------|-----------------------------------|

|   | · | enter into certain restrictive agreements; |
|--------|--------|--------------------------------------------|

|   | · | pay dividends and distributions or repurchase our shares; and |
|--------|--------|---------------------------------------------------------------|

|   | · | redeem, purchase or otherwise withdraw any capital contributions made to our capital reserves. |
|--------|--------|------------------------------------------------------------------------------------------------|

----

|   | · | nonpayment of principal or interest; |
|--------|--------|--------------------------------------|

|   | · | violation of covenants or undertakings; |
|--------|--------|-----------------------------------------|

|   | · | representations, warranties or written statements being untrue; |
|--------|--------|-----------------------------------------------------------------|

|   | · | cross default and cross acceleration; |
|--------|--------|---------------------------------------|

|   | · | certain liquidation, insolvency, winding-up, attachment and bankruptcy events; |
|--------|--------|--------------------------------------------------------------------------------|

|   | · | certain litigation, arbitration, administrative or environmental claims having a material adverse effect on the Elster Group or any of its subsidiaries; |
|--------|--------|----------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | qualification by the auditors of the consolidated financial statements of the Elster Group which is materially adverse to the interests of the lenders; |
|--------|--------|---------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | certain change of control events; |
|--------|--------|-----------------------------------|

|   | · | material non-monetary judgments or judgments which are not being contested in excess of €5 million in the aggregate being made against an obligor or any material subsidiary of the Elster Group; |
|--------|--------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | material adverse change; and |
|--------|--------|------------------------------|

----

|   | · | certain ERISA matters. |
|--------|--------|------------------------|

----

|   | · | revenue recognition; |
|--------|--------|----------------------|

|   | · | calculation of warranty provisions; |
|--------|--------|-------------------------------------|

|   | · | valuation of inventories; |
|--------|--------|---------------------------|

|   | · | goodwill and intangible assets; and |
|--------|--------|-------------------------------------|

|   | · | uncertain tax provisions. |
|--------|--------|---------------------------|

----

----

----

----

----

----

----

----

----

|   | · | appoint and dismiss our Managing Directors and represent our company in its transactions with the Managing Directors; |
|--------|--------|-----------------------------------------------------------------------------------------------------------------------|

|   | · | approve matters where approval is reserved to it by mandatorily applicable law or our Articles of Association; |
|--------|--------|----------------------------------------------------------------------------------------------------------------|

|   | · | establish committees of the Administrative Board and appoint their members; |
|--------|--------|-----------------------------------------------------------------------------|

|   | · | review and approve our annual accounts, our annual report and our Managing Directors' recommendation to the shareholders' meeting regarding how our profits (if any) should be allocated; and |
|--------|--------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | ensure that adequate monitoring systems exist to detect at an early stage risks threatening the existence of our company. |
|--------|--------|---------------------------------------------------------------------------------------------------------------------------|

----

----

| Name                  |   | Age    |   | Function                |   | Term Expires |   | Principal Occupation                 |
|-----------------------|--------|--------|--------|-------------------------|--------|-------------------|--------|-------------------------------------------|
|                  |   |   |   |                    |   |              |   |                                      |
| Simon Beresford-Wylie |   | 52     |   | Chief Executive Officer |   | 2013              |   | CEO of Elster Group SE                    |
|                  |   |   |   |                    |   |              |   |                                      |
| Michael Cannon        |   | 58     |   | Non-Managing Member     |   | 2014              |   | Board Member                              |
|                  |   |   |   |                    |   |              |   |                                      |
| John Delucca          |   | 67     |   | Non-Managing Member     |   | 2014              |   | Board Member                              |
|                  |   |   |   |                    |   |              |   |                                      |
| Howard Dyer           |   | 61     |   | Chairman                |   | 2013              |   | Chairman of Elster Group SE               |
|                  |   |   |   |                    |   |              |   |                                      |
| Gregor Hilverkus      |   | 39     |   | Non-Managing Member     |   | 2013              |   | Managing Director of CVC Capital Partners |
|                  |   |   |   |                    |   |              |   |                                      |
| Steven Koltes         |   | 55     |   | Non-Managing Member     |   | 2013              |   | Managing Partner of CVC Capital Partners  |
|                  |   |   |   |                    |   |              |   |                                      |
| Marc Strobel          |   | 44     |   | Deputy Chairman         |   | 2013              |   | Partner of CVC Capital Partners           |

----

----

|   | · | preparing the decisions of the Administrative Board concerning approval of our company's annual financial statements, including review of the financial statements, our annual reports, our Managing Directors' proposal for the recommendation of the Administrative Board to the shareholders' meeting regarding how our profits (if any) should be allocated and the reports of our independent auditors; |
|--------|--------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | reviewing the interim financial statements of our company that are made public or filed with any securities regulatory authority; |
|--------|--------|-----------------------------------------------------------------------------------------------------------------------------------|

|   | · | handling auditor independence issues, preparing the resolution of our shareholders' meeting to mandate our auditor and approving any services by the auditor; |
|--------|--------|---------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | handling risk management issues and supervising the risk management system; |
|--------|--------|-----------------------------------------------------------------------------|

|   | · | establishing and maintaining procedures pursuant to which our employees can report to the Audit Committee, on an anonymous and confidential basis, complaints regarding our accounting and auditing practices, and enacting rules pursuant to which complaints we receive from third parties will be reported to the Audit Committee; |
|--------|--------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | approving related party transactions, as described in "Item 7. Major Shareholders and Related Party Transactions;" |
|--------|--------|--------------------------------------------------------------------------------------------------------------------|

----

|   | · | discussing any flaws relating to our internal control systems, as reported by the Administrative Board to the Audit Committee; and |
|--------|--------|-----------------------------------------------------------------------------------------------------------------------------------------|

|   | · | monitoring our bookkeeping and recording procedures. |
|--------|--------|------------------------------------------------------|

|   | · | no member of the Audit Committee may, directly or indirectly, accept any consulting, advisory or other compensatory fees from our company or its subsidiaries other than in such member's capacity as a member of the Administrative Board or any of its committees; and |
|--------|--------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | no member of the Audit Committee may be an "affiliated person" of our company or any of its subsidiaries except for such member's capacity as a member of the Administrative Board or any Board committee, for this purpose, the term "affiliated person" means a person that directly or indirectly controls or is controlled by, or possesses (directly or indirectly) the power to direct or cause the direction of the management (whether through the ownership of voting securities, by contract or otherwise). |
|--------|--------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | develop general compensation principles for the Administrative Board and compensation arrangements for the Managing Directors and the non-managing members of the Administrative Board; classify in detail the various components of compensation (fixed, variable and stock-based) and all other ancillary benefits, including retirement and severance benefits, and analyze associated performance targets; |
|--------|--------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | prepare the resolutions concerning the compensation and benefits, including stock-based benefits, of the Managing Directors and the non-managing members of the Administrative Board, to the extent permitted by law; and |
|--------|--------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

|   | · | regularly review the adequacy of compensation in light of legal requirements under German law, best practices among similarly-situated companies in the same and comparable industries and more generally, and among other companies whose shares are listed on the same securities exchange on which our company maintains its primary listing. |
|--------|--------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | identify, pre-screen, interview and recommend to the Administrative Board individuals qualified to become Administrative Board members and Managing Directors, consistent with criteria approved by the Administrative Board; |
|--------|--------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | monitor best practices and trends in corporate governance among similarly-situated companies in the same and comparable industries and more generally, and among other companies whose shares are listed on the same securities exchange on which our company maintains its primary listing; and |
|--------|--------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | develop and recommend to the Administrative Board a set of corporate governance principles applicable to the company.  |
|--------|--------|-----------------------------------------------------------------------------------------------------------------------------|

----

|   | · | the preparation of our annual financial statements; |
|--------|--------|-----------------------------------------------------|

|   | · | the making of a proposal for the Administrative Board's recommendation to our shareholders' meeting on how our profits (if any) should be allocated; and |
|--------|--------|---------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | regular reporting to the Administrative Board on our current operating and financial performance, our budgeting and planning processes and our performance under them and on future business planning (including strategic, financial, investment and personnel planning).  |
|--------|--------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | our Chief Executive Officer is responsible for, among other things, strategy and business development, operations and technology; |
|--------|--------|-----------------------------------------------------------------------------------------------------------------------------------|

|   | · | our Chief Financial Officer is responsible for, among other things, finance and treasury, accounting, financial reporting, controlling and taxes; and |
|--------|--------|------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | our Chief Legal Officer is responsible for, among other things, legal affairs, compliance oversight, relationships with regulators and disclosure controls and procedures. |
|--------|--------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | the acceptance of our overall business plan and annual budget; |
|--------|--------|----------------------------------------------------------------|

|   | · | the incurrence of indebtedness in excess of €20 million or granting of any security interest in that amount in any individual transaction or series of related transactions by our company or any of its subsidiaries, other than pursuant to the Senior Facilities Agreement; |
|--------|--------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | the entry into, termination of, amendment of or waiver under any contract (including employment contracts) or other arrangement between (a) our company or any subsidiary and (b) any member of the Administrative Board or any person or legal entity that is affiliated with or otherwise closely connected to a member of the Administrative Board; |
|--------|--------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

|   | · | the acquisition or disposal of a company, a business, assets or real estate with a value in excess of €20 million in any individual transaction or series of related transactions by our company or any subsidiary, unless contained in an annual approved budget; and |
|--------|--------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | the entering into capital expenditure commitments in excess of amounts contained in an approved annual budget, if that commitment exceeds €5 million in any individual case or exceeds €10 million in total. |
|--------|--------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| Name                   |   | Age    |   | 1st appointment |   | Function                |
|------------------------|--------|--------|--------|----------------------|--------|-------------------------|
|                   |   |   |   |                 |   |                    |
| Simon Beresford-Wylie  |   | 52     |   | 2010                 |   | Chief Executive Officer |
|                   |   |   |   |                 |   |                    |
| Christoph Schmidt-Wolf |   | 55     |   | 2010                 |   | Chief Financial Officer |
|                   |   |   |   |                 |   |                    |
| Thomas Preute          |   | 43     |   | 2010                 |   | Chief Legal Officer     |

----

----

| Name                  |   | Base salary |       |   | Bonus  |   |       | Chairman andcommittee fee |   |   | Deferredcompensation(1) |   |   | Totalcompensation |      |   |
|-----------------------|--------|-------------|------------|--------|--------|--------|------------|---------------------------|--------|--------|-------------------------|--------|--------|-------------------|-----------|--------|
|                  |   | in €  |       |   |
| Simon Beresford-Wylie |   |        | 0.00       |   |   |   | 0.00       |                      |   |   | 0.00                    |   |   |              | 0.00      |   |   |   | 0.00 | (2 | ) |
| Michael Cannon        |   |        | 23,631.56  |   |   |   | 0.00       |                      |   |   | 2,835.79                |   |   |              | 14,178.94 |   |   |   | 40,646.29 | (3 | ) |
| John Delucca          |   |        | 23,631.56  |   |   |   | 0.00       |                      |   |   | 2,835.79                |   |   |              | 14,178.94 |   |   |   | 40,646.29 | (3 | ) |
| Howard Dyer           |   |        | 473,631.56 |   |   |   | 503,109.72 |                      |   |   | 17,014.73               |   |   |              | 14,178.94 |   |   |   | 1,007,934.95 | (4 | ) |
| Gregor Hilverkus      |   |        | 23,631.56  |   |   |   | 0.00       |                      |   |   | 0.00                    |   |   |              | 14,178.94 |   |   |   | 37,810.50 | (5 | ) |
| Steven Koltes         |   |        | 38,631.56  |   |   |   | 0.00       |                      |   |   | 0.00                    |   |   |              | 14,178.94 |   |   |   | 52,810.50 | (5 | ) |
| Marc Strobel          |   |        | 23,631.56  |   |   |   | 0.00       |                      |   |   | 0.00                    |   |   |              | 14,178.94 |   |   |   | 37,810.50 | (5 | ) |
| Total                 |   |        | 606,789.36 |   |   |   | 503,109.72 |                      |   |   | 22,686.31               |   |   |              | 85,073.64 |   |   |   | 1,217,659.03 |   |   |

| (1) | These amounts will be used to purchase ADSs in 2011 for members of the Administrative Board. In accordance with our Articles of Association, the members of our Administrative Board will receive these ADSs after a period of four years. |
|-----|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (2) | Mr. Beresford-Wylie did not earn any compensation in connection with his role as member of our Administrative Board.  He earned his compensation as a Managing Director.  Please see “—Compensation of the Managing Directors” for more information. |
|-----|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (3) | Mr. Cannon and Mr. Delucca have only earned amounts in connection with their service on our Administrative Board since our IPO in October 2010.  This compensation will be paid out in 2011. |
|-----|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (4) | Of this total, €450,000 was for services as a member of our Administrative Board from January 2010 until the completion of our IPO and was paid in 2010. The bonus relates to service from January 2010 until the completion of our IPO and will be paid out in 2011. Other compensation was earned in connection with services as a member of our Administrative Board since our IPO and will be paid out in 2011. |
|-----|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (5) | We expect to pay the compensation earned by Messrs. Hilverkus, Koltes and Strobel for their services on our Administrative Board since our IPO to CVC Capital Partners. In addition, the deferred compensation earned by Messrs. Hilverkus, Koltes and Strobel will be used to purchase ADSs, which we expect will be transferred to funds advised by CVC Capital Partners following the four-year vesting period. For Mr. Koltes, €15,000 of his total was for services on our Administrative Board from January 2010 until the completion of our IPO and was paid in 2010 to CVC Capital Partners in accordance with our Articles of Association in effect prior to our IPO. The remaining €37,810.50 was earned in connection with services as a member of our Administrative Board since our IPO. |
|-----|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

|   | · | the duties of the individual Managing Director; |
|--------|--------|-------------------------------------------------|

|   | · | the Managing Director’s personal performance; |
|--------|--------|-----------------------------------------------------|

|   | · | our business situation; |
|--------|--------|-------------------------|

|   | · | our success and prospects; |
|--------|--------|----------------------------|

|   | · | prevailing compensation levels at peer companies; and |
|--------|--------|-------------------------------------------------------|

|   | · | our overall compensation structure for all employees. |
|--------|--------|-------------------------------------------------------|

----

----

| Name                   |   | Base salary |         |   | Bonus  |   |         | Othercompensation |   |   | ADS awards |   |   | Totalcompensation |         |
|------------------------|--------|------------------|--------------|--------|--------|--------|--------------|-------------------|--------|--------|-----------------|--------|--------|-------------------|--------------|
|                   |   | in €       |         |
| Simon Beresford-Wylie  |   |             | 850,000.00   |   |   |   | 952,929.12   | (1)               |   |   | 19,058.40       | (2)    |   |              | 914,477.70   | (5) |   |   | 2,736,465.22 |   |
| Christoph Schmidt-Wolf |   |             | 368,750.00   |   |   |   | 476,464.56   | (1)               |   |   | 49,424.80       | (3)    |   |              | 0.00         |   |   |   | 894,639.36 |   |
| Thomas Preute          |   |             | 170,504.00   |   |   |   | 134,531.17   | (1)               |   |   | 25,299.16       | (4)    |   |              | 215,166.40   | (5) |   |   | 545,500.73 |   |
| Total                  |   |             | 1,389,254.00 |   |   |   | 1,563,924.85 |              |   |   | 93,782.36       |   |   |              | 1,129,644.10 |   |   |   | 4,176,605.31 |   |

| (1) | This amount represents the bonus for 2010 to be paid in 2011. |
|-----|---------------------------------------------------------------|

| (2) | This amount represents €18,000.00 automobile allowance and €1,058.40 premium for accident insurance taken out by us for Mr. Beresford-Wylie. |
|-----|----------------------------------------------------------------------------------------------------------------------------------------------------------|

| (3) | This amount represents €18,000.00 automobile allowance, €18,000.00 housing allowance, €13,090.00 service fees for the Supervisory Board of Elster GmbH and €334.80 premium for accident insurance taken out by us for Mr. Schmidt-Wolf. |
|-----|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (4) | This amount represents €18,002.88 for a company car, €7,140.00 service fees for the Supervisory Board of Elster GmbH and €156.28 premium for accident insurance taken out by us for Mr. Preute. |
|-----|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (5) | Amounts shown in this column represent the grant date fair value of the non-vested ADSs granted at September 30, 2010 under the company’s Long Term Incentive Plan.  Compensation expense recognized in 2010 for these ADS awards in accordance with accounting standards amounts to €57,154.90 for Mr. Beresford-Wylie and €13,447.90 for Mr. Preute.  |
|-----|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

|                                        |   | As of December 31, |   |
|---------------------------------------------|--------|-----------------------------------|--------|
|                                        |   | 2010                              |   |   | % |   |   | 2009 |   |   | % |   |   | 2008 |   |   | % |   |
| Function                                    |   |                              |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Manufacturing, assembly and operation       |   |                              | 4,387  |   |   |   | 63.0 |   |   |   | 4,369 |   |   |   | 63.7 |   |   |   | 5,054 |   |   |   | 66.3 |   |
| Sales and Marketing                         |   |                              | 863    |   |   |   | 12.4 |   |   |   | 834 |   |   |   | 12.2 |   |   |   | 861 |   |   |   | 11.3 |   |
| Research & Development                  |   |                              | 632    |   |   |   | 9.1 |   |   |   | 561 |   |   |   | 8.2 |   |   |   | 551 |   |   |   | 7.2 |   |
| Packaging warehousing and supply management |   |                              | 419    |   |   |   | 6.0 |   |   |   | 436 |   |   |   | 6.4 |   |   |   | 460 |   |   |   | 6.0 |   |
| Finance, controlling, accounting            |   |                              | 289    |   |   |   | 4.2 |   |   |   | 284 |   |   |   | 4.1 |   |   |   | 289 |   |   |   | 3.8 |   |
| Management                                  |   |                              | 85     |   |   |   | 1.2 |   |   |   | 98 |   |   |   | 1.4 |   |   |   | 111 |   |   |   | 1.5 |   |
| Other (IT, HR, etc.)                        |   |                              | 284    |   |   |   | 4.1 |   |   |   | 271 |   |   |   | 4.0 |   |   |   | 298 |   |   |   | 3.9 |   |
| Total                                       |   |                              | 6,959  |   |   |   | 100.0 |   |   |   | 6,853 |   |   |   | 100.0 |   |   |   | 7,624 |   |   |   | 100.0 |   |
|                                        |   |                              |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Location                                    |   |                              |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Europe                                      |   |                              | 3,710  |   |   |   | 53.3 |   |   |   | 3,686 |   |   |   | 53.8 |   |   |   | 4,128 |   |   |   | 54.1 |   |
| North America                               |   |                              | 2,082  |   |   |   | 29.9 |   |   |   | 1,853 |   |   |   | 27.0 |   |   |   | 2,101 |   |   |   | 27.6 |   |
| Rest of World                               |   |                              | 1,167  |   |   |   | 16.8 |   |   |   | 1,314 |   |   |   | 19.2 |   |   |   | 1,395 |   |   |   | 18.3 |   |
| Total                                       |   |                              | 6,959  |   |   |   | 100.0 |   |   |   | 6,853 |   |   |   | 100.0 |   |   |   | 7,624 |   |   |   | 100.0 |   |

----

| Name                   |   | Number ofADSs grantedunder LTIP |    |   | ADS awardsunder LTIP |   |
|------------------------|--------|-------------------------------------------|---------|--------|--------------------------------|--------|
|                   |   |                                      |    |   | in €                     |   |
|                   |   |                                      |    |   |                           |   |
| Simon Beresford-Wylie  |   |                                      | 112,466 |   |                           |   | 914,477.70 |   |
| Christoph Schmidt-Wolf |   |                                      | 0       |   |                           |   | 0.00 |   |
| Thomas Preute          |   |                                      | 26,462  |   |                           |   | 215,166.40 |   |
| Total                  |   |                                      | 138,928 |   |                           |   | 1,129,644.10 |   |

----

|                                                                                            |   | ADSs Owned |        |
|-------------------------------------------------------------------------------------------------|--------|-----------------|-------------|
| Name                                                                                            |   | Number          |        |   | Percent |   |
| Rembrandt Holdings S.A. (1)                                                                     |   |            | 88,048,276  |   |   |   | 78.00 |   |
| Nachtwache Metering Management Vermögensverwaltungs GmbH & Co. KG (the Management KG): |   |            |        |   |   |   |   |   |
| Howard Dyer (2)                                                                                 |   |            | 1,627,996   |   |   |   | 1.44 |   |
| Christoph Schmidt-Wolf (2)                                                                      |   |            | 930,283     | (5) |   |   | 0.82 |   |
| Simon Beresford-Wylie (2)                                                                       |   |            | 620,189     |   |   |   | 0.55 |   |
| Thomas Preute (2)                                                                               |   |            | 93,028      | (6) |   |   | 0.08 |   |
| Nachtwache Reserve GmbH (2)(3)                                                                  |   |            | 535,509     |   |   |   | 0.47 |   |
| Other MEP participants as a group (2)(4)                                                        |   |            | 2,394,883   |   |   |   | 2.12 |   |
| Total Management KG                                                                             |   |            | 6,201,888   |   |   |   | 5.49 |   |
| Public Shareholders                                                                             |   |            | 18,630,000  |   |   |   | 16.50 |   |
| Total                                                                                           |   |            | 112,880,164 |   |   |   | 100.00 |   |

| (1) | Rembrandt Holdings S.A. is 100% collectively owned by CVC European Equity Partners IV (A) L.P., CVC European Equity Partners IV (B) L.P., CVC European Equity Partners IV (C) L.P., CVC European Equity Partners IV (D) L.P. and CVC European Equity Partners IV (E) L.P. CVC European Equity Partners IV (A) L.P. and CVC European Equity Partners IV (B) L.P. are managed by their general partner, CVC European Equity Partners IV (AB) Limited. CVC European Equity Partners (C) L.P., CVC European Equity Partners IV (D) L.P., CVC European Equity Partners IV (E) L.P. are managed by their general partner, CVC European Equity Partners IV (CDE) Limited. We refer to CVC European Equity Partners IV (AB) Limited and CVC European Equity Partners IV (CDE) Limited as the General Partners. Each of theGeneral Partners acts as sole investment manager to the funds it manages and accordingly exercises voting and dispositive control over the shares held by those funds, including the shares of Rembrandt. As of December 31, 2010, the board of directors of each of the General Partners consists of the following individuals: Mark Grizzelle, Steven Koltes, Michael Smith, Brian Scholfield and Carl Hansen. These individuals are the natural persons who, in each case acting together in their capacities as members of the respective board of directors, possess voting and dispositive control over the shares held by the General Partners and the shares held by Rembrandt Holdings, S.A. The General Partners and directors disclaim beneficial ownership in the shares of our company. |
|-----|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (2) | Holds no ADSs or ordinary shares in our company, but does hold limited partnership interest in the Management KG. While none of the shares in our company that the Management KG holds may be attributed to any individual participant, the participants do have the right to receive their pro rata portion of the proceeds of any sale of our shares by the Management KG and to vote on any resolutions of the Management KG, in each case based on their respective interests in the Management KG. We therefore have included in the table the number of ADSs that arithmetically corresponds to the named individuals' proportionate interests in the Management KG. These individuals disclaim beneficial ownership of the shares underlying these ADSs. |
|-----|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (3) | Nachtwache Reserve GmbH is controlled by Rembrandt. It does not have individual dispositive control over the shares in our company that may be attributed to it through its ownership of limited partnership interests in the Management KG. |
|-----|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (4) | Other than the four individuals named above, no participant in the MEP holds limited partnership interests in the Management KG to which 0.5% or more of our ordinary shares may be attributed. For further information regarding the MEP, the Management KG and its holding of our shares, see "—Related Party Transactions—The Management KG and Our Management Equity Program." |
|-----|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (5) | Approximately 33% of the limited partnership interests attributed to Mr. Schmidt-Wolf are held by him on behalf of his spouse, Mrs. Martina Schmidt-Wolf. |
|-----|---------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (6) | Approximately 50% of the limited partnership interests attributed to Mr. Preute are held by him on behalf of his spouse, Mrs. Christiane Preute. |
|-----|------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

|   | · | a resolution not to give effect to existing shareholders' preemptive rights in a capital increase; |
|--------|--------|----------------------------------------------------------------------------------------------------|

----

|   | · | any capital decrease, merger, consolidation, spin-off, sale or other transfer of all or substantially all of our assets; |
|--------|--------|--------------------------------------------------------------------------------------------------------------------------|

|   | · | a change in the corporate form or business purpose of the company; or |
|--------|--------|----------------------------------------------------------------------------|

|   | · | the dissolution of our company. |
|--------|--------|---------------------------------|

----

----

----

| Name                                 |   | PercentageHolding ofLimitedPartnershipInterests |   |   | Percentage of our SharesCorresponding to Holding of Limited Partnerhip Interests |   |
|--------------------------------------|--------|------------------------------------------------------|--------|--------|---------------------------------------------------------------------------------------------------------------------|--------|
|                                 |   |                                                 |   |   |                                                                                                                |   |
| Howard Dyer                          |   |                                                 | 26.25  | %      |                                                                                                                |   | 1.44 | % |
| Christoph Schmidt-Wolf               |   |                                                 | 15.00  | %(2)   |                                                                                                                |   | 0.82 | % |
| Simon Beresford-Wylie                |   |                                                 | 10.00  | %      |                                                                                                                |   | 0.55 | % |
| Thomas Preute                        |   |                                                 | 1.50   | %(3)   |                                                                                                                |   | 0.08 | % |
| Others, as a group (1)               |   |                                                 | 38.62  | %      |                                                                                                                |   | 2.12 | % |
| Subtotal individual MEP participants |   |                                                 | 91.37  | %      |                                                                                                                |   | 5.02 | % |
| Nachtwache Reserve GmbH              |   |                                                 | 8.63   | %      |                                                                                                                |   | 0.47 | % |
| Total                                |   |                                                 | 100.00 | %      |                                                                                                                |   | 5.49 | % |

| (1) | None of these individuals own limited partnership interests in the Management KG that arithmetically correspond to a proportion of the shares or ADSs in our company equal to 0.5% or more of our outstanding ordinary shares. |
|-----|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (2) | Approximately 33% of the limited partnership interest attributed to Mr. Schmidt-Wolf are held by him on behalf of his spouse, Mrs. Martina Schmidt-Wolf. |
|-----|--------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (3) | Approximately 50% of the limited partnership interest attributed to Mr. Preute are held by him on behalf of his spouse, Mrs. Christiane Preute. |
|-----|-----------------------------------------------------------------------------------------------------------------------------------------------------------|

----

----

----

|                     |   | Price per Elster ADS share |   |
|--------------------------|--------|------------------------------------------------|--------|
|                     |   | High                                           |   |   | Low |   |
|                     |   | USD                                            |   |   | USD |   |
| Quarterly highs and lows |   |                                           |   |   |   |   |
|                     |   |                                           |   |   |   |   |
| 2010                     |   |                                           |   |   |   |   |
| Fourth quarter           |   |                                           | 17.10  |   |   |   | 13.50 |   |
|                     |   |                                           |   |   |   |   |   |   |
| Monthly highs and lows   |   |                                           |   |   |   |   |   |   |
|                     |   |                                           |   |   |   |   |   |   |
| 2010                     |   |                                           |   |   |   |   |   |   |
| September 30, 2010       |   |                                           | 14.40  |   |   |   | 13.70 |   |
| October                  |   |                                           | 15.05  |   |   |   | 13.50 |   |
| November                 |   |                                           | 16.30  |   |   |   | 14.75 |   |
| December                 |   |                                           | 17.10  |   |   |   | 15.49 |   |
|                     |   |                                           |   |   |   |   |   |   |
| 2011                     |   |                                           |   |   |   |   |   |   |
| January                  |   |                                           | 17.06  |   |   |   | 15.04 |   |
| February                 |   |                                           | 16.90  |   |   |   | 14.98 |   |

----

|   | · | to the extent that new shares must be granted to holders of subscription warrants or convertible bonds that we or any Company in which we have a direct or indirect majority holding have issued, in accordance with the terms of issuance of such warrants or convertible bonds; |
|--------|--------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | if (i) the new shares represent 10% or less of the existing share capital when the authorized capital or issuance or the new shares is registered in the commercial register and (ii) the issue price of the new shares is not considerably lower than the stock exchange price at that time of the shares in our company (based, we expect, on the price of our ADSs on the NYSE and on an exchange rate to be set in the Administrative Board's resolution approving the share issuance); or |
|--------|--------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | to the extent necessary to avoid balancing out fractional amounts. |
|--------|--------|--------------------------------------------------------------------|

----

----

|   | · | the exclusion of preemptive rights in a capital increase; |
|--------|--------|-----------------------------------------------------------|

|   | · | capital decreases; |
|--------|--------|--------------------|

|   | · | the creation of authorized capital or conditional capital; |
|--------|--------|------------------------------------------------------------|

|   | · | dissolution of the company; |
|--------|--------|-----------------------------|

|   | · | a merger (Verschmelzung) with another company or another corporate transformation; |
|--------|--------|------------------------------------------------------------------------------------|

|   | · | a transfer of all or virtually all of the assets of our company; and |
|--------|--------|---------------------------------------------------------------------------|

|   | · | the conclusion of any domination (Beherrschungsvertrag), profit and loss transfer (Ergebnisabführungsvertrag) or similar inter-company agreements. |
|--------|--------|---------------------------------------------------------------------------------------------------------------------------------------------------------|

----

----

|   | · | the beneficial owner of the ADSs (and the dividends paid with respect thereto); |
|--------|--------|---------------------------------------------------------------------------------|

|   | · | a citizen or an individual resident of the United States, a corporation or other entity treated as a corporation for U.S. federal income tax purposes created or organized under the laws of the United States or any state thereof, an estate the income of which is subject to U.S. federal income tax without regard to its source, or a trust if a court within the United States is able to exercise primary supervision over the administration of the trust and one or more U.S. persons have the authority to control all substantial decisions of the trust, or the trust has elected to be treated as a domestic trust for U.S. federal income tax purposes; |
|--------|--------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | not also a resident of Germany for German tax purposes; and |
|--------|--------|------------------------------------------------------------------|

|   | · | not subject to a limitation on benefits (i.e., anti-treaty shopping) article that applies in limited circumstances. |
|--------|--------|---------------------------------------------------------------------------------------------------------------------|

----

----

----

----

----

----

----

----

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|                                |   | Expected Maturity Date              |   |
|-------------------------------------|--------|-----------------------------------------------|--------|
|                                |   |                                          |   |   |   |   |   |   |   |   |   |   |   |   | Beyond |   |   |   |
|                                |   | 2011                                          |   |   | 2012 |   |   | 2013 |   |   | 2014 |   | 2015 |   | 2015 |   | Total |   |
|                                |   | (in $ millions equivalent except percentages) |   |   |   |
|                                |   |                                          |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Floating Rate Debt                  |   |                                          |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Principal: USD                      |   |                                          |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Outstanding debt                    |   | –                                       |   |   | – |   |   |   | 115.0 |   |   |   | 115.0 |   | – |   | – |   |   | 230.0 |   |
| Average interest rate               |   |                                          | 4.62   | % |   |   | 6.22 | % |   |   | 7.13 | % |   |   | 7.70 | % |   |   |   |   |   |   |   |
| Principal: EUR                      |   |                                          |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Outstanding debt                    |   | –                                       |   |   |   | 7.5 |   |   |   | 259.9 |   |   |   | 259.9 |   | – |   | – |   |   | 527.2 |   |
| Average interest rate               |   |                                          | 5.72   | % |   |   | 6.40 | % |   |   | 6.80 | % |   |   | 7.18 | % |   |   |   |   |   |   |   |
| Principal: GBP                      |   |                                          |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Outstanding debt                    |   | –                                       |   |   |   | 65.1 |   |   | – |   |   | – |   | – |   | – |   |   | 65.1 |   |
| Average interest rate               |   |                                          | 4.68   | % |   |   | 6.18 | % |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Interest Rate Swaps (1)(2)          |   |                                          |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| USD denominated (3)                 |   | –                                       |   |   |   | 230.0 |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Average interest rate (pay)         |   |                                          | 2.24   | % |   |   | 2.24 | % |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Average interest rate (receive) (4) |   |                                          | 1.65   | % |   |   | 3.26 | % |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Net/Spread                          |   |                                          | -0.59  | % |   |   | 1.02 | % |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| EUR denominated (5)                 |   | –                                       |   |   |   | 442.8 |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Average interest rates              |   |                                          | 2.43   | % |   |   | 2.43 | % |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Average interest rate (receive) (6) |   |                                          | 2.79   | % |   |   | 3.47 | % |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Net/Spread                          |   |                                          | 0.36   | % |   |   | 1.04 | % |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |

| (1) | In the calculation of our average interest rates for our Senior Facilities Agreement as well as the receiving leg of our interest rate swaps, we used implied forwards for the respective money market rate. Additionally, for the debt under our Senior Facilities Agreement, we applied the relevant margin adjustment applicable to each tranche as of December 31, 2010. See "Item 5. Operating and Financial Review and Prospects—Senior Facilities Agreement." |
|-----|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (2) | All of our swaps mature on June 30, 2012. |
|-----|-------------------------------------------|

| (3) | All of our U.S. dollar denominated debt is covered by one interest rate swap agreement. |
|-----|-----------------------------------------------------------------------------------------|

| (4) | Under this swap agreement, we receive a floating rate based on U.S. dollar 6-month LIBOR as set by the British Banker's Association. |
|-----|--------------------------------------------------------------------------------------------------------------------------------------|

| (5) | Most of our euro denominated debt is covered under our interest rate swap agreements. |
|-----|---------------------------------------------------------------------------------------|

| (6) | Under these swap agreements, we receive a floating rate based on 6-month EURIBOR as reported by Reuters. |
|-----|----------------------------------------------------------------------------------------------------------|

----

----

| Fees and Expenses                                                                                                                                                                                                                                                                                                 |   |                                                                                                                                                               |
|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|                                                                                                                                                                                                                                                                                                              |   |                                                                                                                                                               |
| Persons Depositing or Withdrawing Shares Must Pay:                                                                                                                                                                                                                                                                |   | For:                                                                                                                                                               |
|                                                                                                                                                                                                                                                                                                              |   |                                                                                                                                                               |
| Registration or transfer fees                                                                                                                                                                                                                                                                                     |   | Transfer and registration of ordinary shares on our share register to or from the name of the depositary or its agent when you deposit or withdraw ordinary shares |
|                                                                                                                                                                                                                                                                                                              |   |                                                                                                                                                               |
| Expenses of the depositary                                                                                                                                                                                                                                                                                        |   | Cable, telex, facsimile and electronic transmissions and deliveries (as expressly provided in the deposit agreement)                                               |
|                                                                                                                                                                                                                                                                                                              |   |                                                                                                                                                               |
|                                                                                                                                                                                                                                                                                                              |   | Converting foreign currency to U.S. dollars                                                                                                                        |
|                                                                                                                                                                                                                                                                                                              |   |                                                                                                                                                               |
| Taxes and other governmental charges the depositary or the custodian have to pay on any ADS or share underlying an ADS, including any applicable interest and penalties thereon and any share transfer or other taxes or governmental charges, for example, stock transfer taxes, stamp duty or withholding taxes |   | As necessary                                                                                                                                                       |
|                                                                                                                                                                                                                                                                                                              |   |                                                                                                                                                               |
| Fees incurred by the depositary in connection with compliance with exchange control regulations and other regulatory requirements applicable to the ordinary shares, ADSs, ADRs and other deposited securities                                                                                                    |   | As necessary                                                                                                                                                       |
|                                                                                                                                                                                                                                                                                                              |   |                                                                                                                                                               |
| Fees incurred by the depositary in connection with the delivery of the deposited securities                                                                                                                                                                                                                       |   | As necessary                                                                                                                                                       |
|                                                                                                                                                                                                                                                                                                              |   |                                                                                                                                                               |
| Any charges incurred by the depositary or its agents for servicing the deposited securities                                                                                                                                                                                                                       |   | As necessary                                                                                                                                                       |

----

----

|   | · | We registered $175,000,032 of our ordinary shares. We sold a total of 13,461,540 ADSs representing 3,365,385 of our ordinary shares for an aggregate total amount of $175,000,020. We paid $7,875,001 in total underwriting discounts and commissions to the underwriters. |
|--------|--------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | Rembrandt registered $154,464,480 of our ordinary shares. A total of 4,842,048 of our ADSs (including the over-allotment option of 2,430,000 ADSs) representing 1,210,512 of our ordinary shares were sold by Rembrandt for an aggregate total amount of $62,946,624. Rembrandt paid $2,832,598 in total underwriting commissions and discounts to the underwriters. |
|--------|--------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | The Management KG registered $5,875,488 of our ordinary shares. A total of 326,412 of our ADSs representing 81,603 of our ordinary shares were sold by the Management KG for an aggregate total amount of $4,243,356. The Management KG paid $190,951 in total underwriting commissions and discounts to the underwriters. |
|--------|--------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | $143.9 million were used to pay outstanding debt under our Senior Facilities Agreement. We repaid this amount on October 12, 2010. |
|--------|--------|-----------------------------------------------------------------------------------------------------------------------------------------|

|   | · | $6.8 million were used to repay a loan made to us by the Management KG of €3.9 million ($5.4 million) in principal amount plus accrued interest of €1.0 million ($1.4 million). |
|--------|--------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

|   | · | $2.7 million of the net proceeds were retained to support our cash position. |
|--------|--------|-----------------------------------------------------------------------------------|

| Tranche        |   | Amount inContractCurrency |   |   | Amount in Euro |    |   | Amount inDollars (1) |   | Original MaturityDate |   | Interest Ratebeforerepayment (2) |           |
|----------------|--------|--------------------------------|--------|--------|--------------------------|---------|--------|--------------------------------|--------|----------------------------|--------|--------------------------------------------|----------------|
|           |   | (in millions)             |   |   | (in millions)       |    |   | (in millions)             |   |                       |   |                                       |           |
| Tranche A GBP  |   | £                         | 6.0    |   |                     | € | 7.0    | (3)                            |   | $                          | 9.6    |                                       | Sept. 30, 2012 |   |   | 2.07 | % |
| Tranche B EUR  |   | €                        | 16.0   |   |                     | € | 16.0   |                           |   | $                          | 22.1   |                                       | Sept. 30, 2013 |   |   | 2.46 | % |
| Tranche B USD  |   | $                              | 22.1   |   |                     | € | 16.0   | (1)                            |   | $                          | 22.1   |                                       | Sept. 30, 2013 |   |   | 2.35 | % |
| Tranche B1 EUR |   | €                        | 16.7   |   |                     | € | 16.7   |                           |   | $                          | 23.0   |                                       | Sept. 30, 2013 |   |   | 2.46 | % |
| Tranche C EUR  |   | €                        | 16.0   |   |                     | € | 16.0   |                           |   | $                          | 22.1   |                                       | Sept. 30, 2014 |   |   | 2.96 | % |
| Tranche C USD  |   | $                              | 22.1   |   |                     | € | 16.0   | (1)                            |   | $                          | 22.1   |                                       | Sept. 30, 2014 |   |   | 2.85 | % |
| Tranche C1 EUR |   | €                        | 16.7   |   |                     | € | 16.7   |                           |   | $                          | 23.0   |                                       | Sept. 30, 2014 |   |   | 2.96 | % |
| Total          |   |                           |   |   |                     | € | 104.4  |                           |   | $                          | 143.9  |                                       |           |   |   |   |   |

| (1) | Translated between euro to dollars at a rate of €1.00 = $1.3727, the European Central Bank foreign exchange reference rate of euros for dollars on October 12, 2010. |
|-----|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (2) | As of October 12, 2010. |
|-----|-------------------------|

| (3) | Translated from pounds sterling to euro at a rate of €1.00 = £0.8676, the European Central Bank foreign exchange reference rate of euros for pound sterling on October 12, 2010.  |
|-----|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

----

|               |   | Year Ended December 31, |      |
|--------------------|--------|----------------------------------------|-----------|
|               |   | 2010                                   |      |   | 2009 |   |
|               |   | (USD)                                  |      |
| Audit Fees         |   |                                   | 5,685,000 |   |   |   | 7,213,000 |   |
| Audit-Related Fees |   |                                   | 27,000    |   |   |   | 16,000 |   |
| Tax Fees           |   |                                   | 39,000    |   |   |   | 33,000 |   |
| All Other Fees     |   |                                   | 0         |   |   |   | 234,000 |   |
| Total              |   |                                   | 5,751,000 |   |   |   | 7,496,000 |   |

----

----

|   | · | regularly schedule non-management director sessions; and |
|--------|--------|----------------------------------------------------------|

|   | · | adopt and disclose corporate governance guidelines that address certain specified items. |
|--------|--------|------------------------------------------------------------------------------------------|

----

| ExhibitNo. |   | Description                                                                                                                                                                                                                                                                                                                                                                                                                                                       |
|------------|--------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|       |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                              |
| 1.1        |   | Articles of Association of Elster Group SE, as amended (English translation).                                                                                                                                                                                                                                                                                                                                                                                     |
|       |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                              |
| 2.1        |   | The total amount of long-term debt securities of Elster Group SE authorized under any instrument does not exceed 10% of the total assets of the group on a consolidated basis. Elster Group SE hereby agrees to furnish to the SEC, upon its request, a copy of any instrument defining the rights of holders of long-term debt of Elster Group SE or of its subsidiaries for which consolidated or unconsolidated financial statements are required to be filed. |
|       |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                              |
| 4.1        |   | Senior Facilities Agreement as most recently amended on October 13, 2010, and Amendment to Senior Facilities Agreement dated March 7, 2011.                                                                                                                                                                                                                                                                                                                       |
|       |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                              |
| 4.2        |   | Terms and Conditions of Non-Convertible “B” Preferred Equity Certificates dated 9 September 2005 (incorporated by reference to Exhibit 10.3 of Elster Group SE’s Registration Statement F-1, as amended, filed with the SEC on September 13, 2010).                                                                                                                                                                                             |
|       |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                              |
| 4.3        |   | Amendment Agreement dated 30 November 2009 Regarding the Non-Convertible Preferred Equity Certificates “B” dated 9 September 2005 (incorporated by reference to Exhibit 10.4 of Elster Group SE’s Registration Statement F-1, as amended, filed with the SEC on September 13, 2010).                                                                                                                                                            |
|       |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                              |
| 4.4        |   | Shareholder Loan Agreement dated 30 November 2009 (incorporated by reference to Exhibit 10.5 of Elster Group SE’s Registration Statement F-1, as amended, filed with the SEC on September 13, 2010).                                                                                                                                                                                                                                                        |

----

| ExhibitNo. |   | Description                                                                                                                                                                                                                                                                                                                                                                                                  |
|------------|--------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|       |   |                                                                                                                                                                                                                                                                                                                                                                                                         |
| 4.5        |   | Amendment and Restatement Agreement in Respect of an Investment and Shareholders Agreement Regarding Investments in Elster Group S.à.r.l. (formerly Gold Silver S.à.r.l) dated 8 September 2005 as amended and restated from time to time (incorporated by reference to Exhibit 10.6 of Elster Group SE’s Registration Statement F-1, as amended, filed with the SEC on September 13, 2010). |
|       |   |                                                                                                                                                                                                                                                                                                                                                                                                         |
| 4.6        |   | Form of Partnership Agreement Regarding Nachtwache Metering Management Vermögensverwaltungs GmbH & Co. KG dated 8 September 2005 (as last amended by resolution by way of circular procedure on 22 November 2007) (incorporated by reference to Exhibit 10.7 of Elster Group SE’s Registration Statement F-1, as amended, filed with the SEC on September 13, 2010).                          |
|       |   |                                                                                                                                                                                                                                                                                                                                                                                                         |
| 4.7        |   | Form of Agreement on the Sale and Assignment of a Limited Partnership Interest (incorporated by reference to Exhibit 10.8 of Elster Group SE’s Registration Statement F-1, as amended, filed with the SEC on September 13, 2010).                                                                                                                                                                      |
|       |   |                                                                                                                                                                                                                                                                                                                                                                                                         |
| 8.1        |   | List of subsidiaries as of December 31, 2010.                                                                                                                                                                                                                                                                                                                                                                |
|       |   |                                                                                                                                                                                                                                                                                                                                                                                                         |
| 12.1       |   | Certification pursuant to Section 302 of the Sarbanes-Oxley Act.                                                                                                                                                                                                                                                                                                                                             |
|       |   |                                                                                                                                                                                                                                                                                                                                                                                                         |
| 12.2       |   | Certification pursuant to Section 302 of the Sarbanes-Oxley Act.                                                                                                                                                                                                                                                                                                                                             |
|       |   |                                                                                                                                                                                                                                                                                                                                                                                                         |
| 13.1       |   | Certification pursuant to Section 906 of the Sarbanes-Oxley Act.                                                                                                                                                                                                                                                                                                                                             |

----

| ELSTER GROUP SE                                                     |   |
|---------------------------------------------------------------------|--------|
|                                                                |   |
| /s/       Simon Beresford-Wylie       |   |
| Simon Beresford-Wylie                                               |   |
| Chief Executive Officer                                             |   |
|                                                                |   |
| /s/       Christoph Schmidt-Wolf |   |
| Christoph Schmidt-Wolf                                              |   |
| Chief Financial Officer                                             |   |

----

|                                                                                                                              | Page  |
|-----------------------------------------------------------------------------------------------------------------------------------|------------|
| Report of Independent Registered Public Accounting Firm                                                                           | F-2        |
| Consolidated Statements of Operations for the years ended December 31, 2010, 2009 and 2008                                        | F-3        |
| Consolidated Balance Sheets as of December 31, 2010 and 2009                                                                      | F-4        |
| Consolidated Statements of Changes in Equity and Comprehensive Income (Loss) for the years ended December 31, 2010, 2009 and 2008 | F-6        |
| Consolidated Statements of Cash Flows for the years ended December 31, 2010, 2009 and 2008                                        | F-8        |
| Notes to the Consolidated Financial Statements                                                                                    | F-9        |

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| KPMG AG                              |
|--------------------------------------|
| Wirtschaftsprüfungsgesellschaft |
|                                 |
| Frankfurt am Main, Germany           |
| March 10, 2011                       |

----

|                                                                     |   | 2010   |       |   | 2009   |   |       | 2008   |   |
|--------------------------------------------------------------------------|--------|--------|------------|--------|--------|--------|------------|--------|--------|
| Revenues                                                                 |   | $      | 1,759,339  |   |   | $      | 1,695,122  |   |   | $ | 1,904,501 |   |
| Cost of revenues                                                         |   |   | -1,208,555 |   |   |   | -1,191,297 |   |   |   | -1,306,257 |   |
| Gross profit                                                             |   | $      | 550,784    |   |   | $      | 503,825    |   |   | $ | 598,244 |   |
|                                                                     |   |   |       |   |   |   |       |   |   |   |   |   |
| Operating expenses                                                       |   |   |       |   |   |   |       |   |   |   |   |   |
| Selling expenses                                                         |   |   | -165,544   |   |   |   | -159,419   |   |   |   | -183,419 |   |
| General and administrative expenses                                      |   |   | -123,819   |   |   |   | -136,997   |   |   |   | -246,454 |   |
| Research and development expenses                                        |   |   | -87,489    |   |   |   | -78,403    |   |   |   | -70,707 |   |
| Other operating income (expense), net                                    |   |   | 2,059      |   |   |   | 14,833     |   |   |   | -39,505 |   |
| Operating income                                                         |   | $      | 175,991    |   |   | $      | 143,839    |   |   | $ | 58,159 |   |
| Non-operating expense                                                    |   |   |       |   |   |   |       |   |   |   |   |   |
| Interest expense, net                                                    |   |   | -60,083    |   |   |   | -55,424    |   |   |   | -117,263 |   |
| Other income, net                                                        |   |   | 2,962      |   |   |   | 3,278      |   |   |   | 2,910 |   |
| Total non-operating expenses                                             |   | $      | -57,121    |   |   | $      | -52,146    |   |   | $ | -114,353 |   |
| Income (loss) from continuing operations before income tax               |   | $      | 118,870    |   |   | $      | 91,693     |   |   | $ | -56,194 |   |
| Income tax expense                                                       |   |   | -29,402    |   |   |   | -39,349    |   |   |   | -30,898 |   |
| Net income (loss) from continuing operations                             |   | $      | 89,468     |   |   | $      | 52,344     |   |   | $ | -87,092 |   |
|                                                                     |   |   |       |   |   |   |       |   |   |   |   |   |
| Net income from discontinued operations                                  |   | $      | 2,570      |   |   | $      | -          |   |   | $ | - |   |
|                                                                     |   |   |       |   |   |   |       |   |   |   |   |   |
| Net income (loss)                                                        |   | $      | 92,038     |   |   | $      | 52,344     |   |   | $ | -87,092 |   |
| Net income attributable to noncontrolling interests                      |   | $      | 4,779      |   |   | $      | 3,456      |   |   | $ | 4,646 |   |
| Net income (loss) attributable to Elster Group SE                        |   | $      | 87,259     |   |   | $      | 48,888     |   |   | $ | -91,738 |   |
|                                                                     |   |   |       |   |   |   |       |   |   |   |   |   |
| Basic income (loss) per share                                            |   |   |       |   |   |   |       |   |   |   |   |   |
| Income (loss) from continuing operations attributable to Elster Group SE |   | $      | 3.39       |   |   | $      | 1.42       |   |   | $ | -5.68 |   |
| Income from discontinued operations attributable to Elster Group SE      |   |   | 0.13       |   |   |   | 0.00       |   |   |   | 0.00 |   |
| Net income (loss) per share attributable to Elster Group SE shareholders |   | $      | 3.53       |   |   | $      | 1.42       |   |   | $ | -5.68 |   |
|                                                                     |   |   |       |   |   |   |       |   |   |   |   |   |
| Diluted income (loss) per share                                          |   |   |       |   |   |   |       |   |   |   |   |   |
| Income (loss) from continuing operations attributable to Elster Group SE |   | $      | 3.39       |   |   | $      | 1.42       |   |   | $ | -5.68 |   |
| Income from discontinued operations attributable to Elster Group SE      |   |   | 0.13       |   |   |   | 0.00       |   |   |   | 0.00 |   |
| Net income (loss) per share attributable to Elster Group SE shareholders |   | $      | 3.53       |   |   | $      | 1.42       |   |   | $ | -5.68 |   |
|                                                                     |   |   |       |   |   |   |       |   |   |   |   |   |
| Weighted average shares outstanding                                      |   |   |       |   |   |   |       |   |   |   |   |   |
| Basic                                                                    |   |   | 19,295,573 |   |   |   | 16,320,750 |   |   |   | 16,320,750 |   |
| Diluted                                                                  |   |   | 19,299,777 |   |   |   | 16,320,750 |   |   |   | 16,320,750 |   |

----

|                                                                                            |   | 2010   |      |   | 2009   |   |
|-------------------------------------------------------------------------------------------------|--------|--------|-----------|--------|--------|--------|
| Assets                                                                                          |   |   |      |   |   |   |
| Current assets                                                                                  |   |   |      |   |   |   |
| Cash and cash equivalents                                                                       |   | $      | 216,294   |   |   | $      | 75,392 |   |
|                                                                                            |   |   |      |   |   |   |   |   |
| Accounts receivable (net of allowance for doubtful accounts of $9,732 and $7,337, respectively) |   |   | 278,217   |   |   |   | 265,652 |   |
| Receivables from related parties                                                                |   |   | 14,197    |   |   |   | 8,615 |   |
| Inventories                                                                                     |   |   | 154,549   |   |   |   | 147,791 |   |
| Prepaid expenses                                                                                |   |   | 21,122    |   |   |   | 24,656 |   |
| Other current assets                                                                            |   |   | 52,863    |   |   |   | 40,252 |   |
| Income tax refunds                                                                              |   |   | 14,501    |   |   |   | 35,518 |   |
| Deferred tax assets                                                                             |   |   | 16,022    |   |   |   | 18,531 |   |
| Total current assets                                                                            |   | $      | 767,765   |   |   | $      | 616,407 |   |
|                                                                                            |   |   |      |   |   |   |   |   |
| Noncurrent assets                                                                               |   |   |      |   |   |   |   |   |
| Property, plant and equipment, net                                                              |   |   | 202,899   |   |   |   | 234,243 |   |
| Other intangible assets, net                                                                    |   |   | 216,406   |   |   |   | 263,844 |   |
| Goodwill                                                                                        |   |   | 936,950   |   |   |   | 981,571 |   |
| Other assets                                                                                    |   |   | 31,496    |   |   |   | 32,605 |   |
| Deferred tax assets                                                                             |   |   | 8,741     |   |   |   | 12,772 |   |
| Total noncurrent assets                                                                         |   | $      | 1,396,492 |   |   | $      | 1,525,035 |   |
|                                                                                            |   |   |      |   |   |   |   |   |
| Total assets                                                                                    |   | $      | 2,164,257 |   |   | $      | 2,141,442 |   |

----

|                                                                                                                                           |   | 2010   |      |   | 2009   |   |
|------------------------------------------------------------------------------------------------------------------------------------------------|--------|--------|-----------|--------|--------|--------|
| Liabilities and Equity                                                                                                                         |   |   |      |   |   |   |
| Current liabilities                                                                                                                            |   |   |      |   |   |   |
| Pension and other long-term employee benefits, current portion                                                                                 |   | $      | 13,486    |   |   | $      | 11,306 |   |
| Payroll, bonuses and related accruals                                                                                                          |   |   | 57,808    |   |   |   | 57,211 |   |
| Short-term debt and current portion of long-term debt                                                                                          |   |   | 18,010    |   |   |   | 38,969 |   |
| Accounts payable                                                                                                                               |   |   | 204,343   |   |   |   | 195,635 |   |
| Warranties                                                                                                                                     |   |   | 31,564    |   |   |   | 34,762 |   |
| Other current liabilities                                                                                                                      |   |   | 74,514    |   |   |   | 77,236 |   |
| Deferred revenue                                                                                                                               |   |   | 4,039     |   |   |   | 5,823 |   |
| Income tax payable                                                                                                                             |   |   | 17,863    |   |   |   | 6,429 |   |
| Deferred tax liabilities                                                                                                                       |   |   | 6,694     |   |   |   | 4,581 |   |
| Total current liabilities                                                                                                                      |   | $      | 428,321   |   |   | $      | 431,952 |   |
|                                                                                                                                           |   |   |      |   |   |   |   |   |
| Noncurrent liabilities                                                                                                                         |   |   |      |   |   |   |   |   |
| Pension and other long-term employee benefits, less current portion                                                                            |   |   | 137,490   |   |   |   | 152,390 |   |
| Payroll, bonuses and related accruals                                                                                                          |   |   | 1,326     |   |   |   | 1,318 |   |
| Long-term debt, less current portion                                                                                                           |   |   | 822,447   |   |   |   | 971,400 |   |
| Shareholder loan                                                                                                                               |   |   | 0         |   |   |   | 6,818 |   |
| Other non-current liabilities                                                                                                                  |   |   | 40,505    |   |   |   | 43,355 |   |
| Income taxes payable                                                                                                                           |   |   | 17,271    |   |   |   | 16,885 |   |
| Deferred tax liabilities                                                                                                                       |   |   | 60,668    |   |   |   | 94,620 |   |
| Total noncurrent liabilities                                                                                                                   |   | $      | 1,079,707 |   |   | $      | 1,286,786 |   |
|                                                                                                                                           |   |   |      |   |   |   |   |   |
| Total liabilities                                                                                                                              |   | $      | 1,508,028 |   |   | $      | 1,718,738 |   |
|                                                                                                                                           |   |   |      |   |   |   |   |   |
| Equity                                                                                                                                         |   |   |      |   |   |   |   |   |
| Preferred shares, €1 nominal value  (none and 308,931,920 shares issued and outstanding as of December 31, 2010 and 2009)      |   |   | 0         |   |   |   | 436,465 |   |
| Ordinary shares, €1 nominal value (28,220,041 and 16,320,750 shares authorized, issued and outstanding as of December 31, 2010 and 2009) |   |   | 36,528    |   |   |   | 20,040 |   |
| Additional paid-in capital                                                                                                                     |   |   | 651,038   |   |   |   | 70,132 |   |
| Accumulated deficit                                                                                                                            |   |   | -68,858   |   |   |   | -138,393 |   |
| Accumulated other comprehensive income                                                                                                         |   |   | 22,006    |   |   |   | 28,307 |   |
| Total equity attributable to Elster Group SE                                                                                                   |   | $      | 640,714   |   |   | $      | 416,551 |   |
| Noncontrolling interests                                                                                                                       |   | $      | 15,515    |   |   | $      | 6,153 |   |
| Total equity                                                                                                                                   |   | $      | 656,229   |   |   | $      | 422,704 |   |
|                                                                                                                                           |   |   |      |   |   |   |   |   |
| Total liabilities and equity                                                                                                              |   | $      | 2,164,257 |   |   | $      | 2,141,442 |   |

----

|                                                                      |   | Preferred shares |        | Ordinary shares |   |                 |   |   |       | Accumulated other comprehensiveincome (loss) |   |               |   |                                  |    |                |   |
|--------------------------------------------------------------------------------|--------|-----------------------|-------------|----------------------|--------|----------------------|--------|--------|------------|-------------------------------------------------------------|--------|--------------------|--------|---------------------------------------|---------|---------------------|--------|
|                                                                           |   | Number ofShares  |        | Amount               |   | Number ofShares |   | Amount |       | AdditionalPaid-inCapital                                    |   | AccumulatedDeficit |   | Pensions andOtherPost-Retirement |    | CurrencyTranslation |   | Derivatives |   | Total EquityAttributable toElster GroupSE |   | NoncontrollingInterests |   | TotalEquity |   |
| January 1, 2008                                                                |   |                  | 0           |                 | $      | -                    |   |   | 16,320,750 |                                                        | $      | 20,040             |   |                                  | 12,682  |                |   | -68,942 |   |   | 32,060 |   |   | -31,925 |   |   | 0 |   |   | -36,085 |   |   | 6,993 |   | $ | -29,092 |   |
| Exchange of mandatorily-redeemable PECs for Class A shares (Note 15 and 16)    |   |                  | 293,217,167 |                 |   | 409,864              |   |   | 0          |                                                        |   | 0                  |   |                                  | 0       |                |   | 0 |   |   | 0 |   |   | 0 |   |   | 0 |   |   | 409,864 |   |   | 0 |   |   | 409,864 |   |
| Share-based compensation arrangement                                           |   |                  | 0           |                 |   | 0                    |   |   | 0          |                                                        |   | 0                  |   |                                  | 90,700  |                |   | 0 |   |   | 0 |   |   | 0 |   |   | 0 |   |   | 90,700 |   |   | 0 |   |   | 90,700 |   |
| Accretion of preferred dividends                                               |   |                  | 0           |                 |   | 961                  |   |   | 0          |                                                        |   | 0                  |   |                                  | 0       |                |   | -961 |   |   | 0 |   |   | 0 |   |   | 0 |   |   | 0 |   |   | 0 |   |   | 0 |   |
| Dividends paid                                                                 |   |                  | 0           |                 |   | 0                    |   |   | 0          |                                                        |   | 0                  |   |                                  | 0       |                |   | 0 |   |   | 0 |   |   | 0 |   |   | 0 |   |   | 0 |   |   | -5,359 |   |   | -5,359 |   |
| Change of noncontrolling interests                                             |   |                  | 0           |                 |   | 0                    |   |   | 0          |                                                        |   | 0                  |   |                                  | 0       |                |   | 0 |   |   | 0 |   |   | 0 |   |   | 0 |   |   | 0 |   |   | -1,743 |   |   | -1,743 |   |
| Comprehensive loss                                                             |   |                  |        |                 |   |                 |   |   |       |                                                        |   |               |   |                                  |    |                |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Changes in actuarial gains and past service costs, net of tax effect of $8,594 |   |                  | 0           |                 |   | 0                    |   |   | 0          |                                                        |   | 0                  |   |                                  | 0       |                |   | 0 |   |   | -14,612 |   |   | 0 |   |   | 0 |   |   | -14,612 |   |   | 0 |   |   | -14,612 |   |
| Foreign currency translation adjustment, net of tax effect of $1,003           |   |                  | 0           |                 |   | 0                    |   |   | 0          |                                                        |   | 0                  |   |                                  | 0       |                |   | 0 |   |   | 0 |   |   | 54,045 |   |   | 0 |   |   | 54,045 |   |   | 1,396 |   |   | 55,441 |   |
| Change in fair value of cash flow hedges, net of tax effect of $-269           |   |                  | 0           |                 |   | 0                    |   |   | 0          |                                                        |   | 0                  |   |                                  | 0       |                |   | 0 |   |   | 0 |   |   | 0 |   |   | 710 |   |   | 710 |   |   | 0 |   |   | 710 |   |
| Net loss                                                                       |   |                  | 0           |                 |   | 0                    |   |   | 0          |                                                        |   | 0                  |   |                                  | 0       |                |   | -91,738 |   |   | 0 |   |   | 0 |   |   | 0 |   |   | -91,738 |   |   | 4,646 |   |   | -87,092 |   |
| Total comprehensive loss                                                       |   |                  | 0           |                 |   | 0                    |   |   | 0          |                                                        |   | 0                  |   |                                  | 0       |                |   | -91,738 |   |   | -14,612 |   |   | 54,045 |   |   | 710 |   |   | -51,595 |   |   | 6,042 |   |   | -45,553 |   |
| December 31, 2008                                                              |   |                  | 293,217,167 |                 |   | 410,825              |   |   | 16,320,750 |                                                        |   | 20,040             |   |                                  | 103,382 |                |   | -161,641 |   |   | 17,448 |   |   | 22,120 |   |   | 710 |   | $ | 412,884 |   |   | 5,933 |   | $ | 418,817 |   |

----

|                                                                               |   | Preferred shares                                                            |   | Ordinary shares      |   |                 |       |   |   | Accumulated other comprehensiveincome (loss) |   |                                       |    |                                       |   |                |   |
|-----------------------------------------------------------------------------------------|--------|----------------------------------------------------------------------------------|--------|---------------------------|--------|----------------------|------------|--------|--------|-------------------------------------------------------------|--------|--------------------------------------------|---------|--------------------------------------------|--------|---------------------|--------|
|                                                                                    |   | Number of     Shares      |   | Amount                    |   | Number ofShares |       | Amount |   |   Additional  Paid-inCapital            |   |   Accumulated  Deficit |    | Pensions andOtherPost-RetirementPlans |   | CurrencyTranslation |   | Derivatives |   | Total EquityAttributabletoElster GroupSE |   | Noncontrol-ling Interests |   | Total Equity |   |
| December 31, 2008                                                                       |   | 293,217,167                                                                      |   |    410,825 |   |                 | 16,320,750 |   |   | 20,040                                                      |   |                                       | 103,382 |                                       |   | -161,641            |   |   | 17,448 |   |   | 22,120 |   |   | 710 |   | $ | 412,884 |   |   | 5,933 |   | $ | 418,817 |   |
| Share-based compensation arrangement                                                    |   | 0                                                                                |   | 0                         |   |                 | 0          |   |   | 0                                                           |   |                                       | -33,250 |                                       |   | 0                   |   |   | 0 |   |   | 0 |   |   | 0 |   |   | -33,250 |   |   | 0 |   |   | -33,250 |   |
| Accretion of preferred dividends                                                        |   | 15,714,753                                                                       |   | 25,640                    |   |                 | 0          |   |   | 0                                                           |   |                                       | 0       |                                       |   | -25,640             |   |   | 0 |   |   | 0 |   |   | 0 |   |   | 0 |   |   |   |   |   | 0 |   |
| Dividends paid                                                                          |   | 0                                                                                |   | 0                         |   |                 | 0          |   |   | 0                                                           |   |                                       | 0       |                                       |   | 0                   |   |   | 0 |   |   | 0 |   |   | 0 |   |   | 0 |   |   | -3,048 |   |   | -3,048 |   |
| Comprehensive income                                                                    |   |                                                                             |   |                      |   |                 |       |   |   |                                                        |   |                                       |    |                                       |   |                |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Changes in actuarial gains (losses) and past service costs, net of tax effect of $2,394 |   | 0                                                                                |   | 0                         |   |                 | 0          |   |   | 0                                                           |   |                                       | 0       |                                       |   | 0                   |   |   | -5,215 |   |   | 0 |   |   | 0 |   |   | -5,215 |   |   | 0 |   |   | -5,215 |   |
| Foreign currency translation adjustment, net of tax effect of $-6                       |   | 0                                                                                |   | 0                         |   |                 | 0          |   |   | 0                                                           |   |                                       | 0       |                                       |   | 0                   |   |   | 0 |   |   | -6,046 |   |   | 0 |   |   | -6,046 |   |   | -188 |   |   | -6,234 |   |
| Change in fair value of cash flow hedges, net of tax effect of $269                     |   | 0                                                                                |   | 0                         |   |                 | 0          |   |   | 0                                                           |   |                                       | 0       |                                       |   | 0                   |   |   | 0 |   |   | 0 |   |   | -710 |   |   | -710 |   |   | 0 |   |   | -710 |   |
| Net income                                                                              |   | 0                                                                                |   | 0                         |   |                 | 0          |   |   | 0                                                           |   |                                       | 0       |                                       |   | 48,888              |   |   | 0 |   |   | 0 |   |   | 0 |   |   | 48,888 |   |   | 3,456 |   |   | 52,344 |   |
| Total comprehensive income                                                              |   | 0                                                                                |   | 0                         |   |                 | 0          |   |   | 0                                                           |   |                                       | 0       |                                       |   | 48,888              |   |   | -5,215 |   |   | -6,046 |   |   | -710 |   |   | 36,917 |   |   | 3,268 |   |   | 40,185 |   |
| December 31, 2009                                                                       |   | 308,931,920                                                                      |   | 436,465                   |   |                 | 16,320,750 |   |   | 20,040                                                      |   |                                       | 70,132  |                                       |   | -138,393            |   |   | 12,233 |   |   | 16,074 |   |   | 0 |   | $ | 416,551 |   |   | 6,153 |   | $ | 422,704 |   |
| Share-based compensation arrangements                                                   |   | 0                                                                                |   | 0                         |   |                 | 0          |   |   | 0                                                           |   |                                       | -13,214 |                                       |   | 0                   |   |   | 0 |   |   | 0 |   |   | 0 |   |   | -13,214 |   |   | 0 |   |   | -13,214 |   |
| Accretion of preferred dividends                                                        |   | 0                                                                                |   | 19,210                    |   |                 | 0          |   |   | 0                                                           |   |                                       | 0       |                                       |   | -19,210             |   |   | 0 |   |   | 0 |   |   | 0 |   |   | 0 |   |   |   |   |   | 0 |   |
| Dividends paid                                                                          |   | 0                                                                                |   | 0                         |   |                 | 0          |   |   | 0                                                           |   |                                       | 0       |                                       |   | 0                   |   |   | 0 |   |   | 0 |   |   | 0 |   |   | 0 |   |   | -831 |   |   | -831 |   |
| Change of noncontrolling interests                                                      |   | 0                                                                                |   | 0                         |   |                 | 0          |   |   | 0                                                           |   |                                       | -4,759  |                                       |   | 0                   |   |   | 0 |   |   | 1,631 |   |   | 0 |   |   | -3,128 |   |   | 5,162 |   |   | 2,034 |   |
| Change in scope of consolidated companies                                               |   |                                                                             |   |                      |   |                 |       |   |   |                                                        |   |                                       |    |                                       |   | 1,486               |   |   |   |   |   |   |   |   |   |   |   | 1,486 |   |   |   |   |   | 1,486 |   |
| Replacement of preferred shares                                                         |   | -308,931,920                                                                     |   | -455,675                  |   |                 | 8,533,906  |   |   | 11,903                                                      |   |                                       | 443,772 |                                       |   |                |   |   |   |   |   | 0 |   |   |   |   |   | 0 |   |   |   |   |   | 0 |   |
| Capital increase, net of related costs                                                  |   |                                                                             |   |                      |   |                 | 3,365,385  |   |   | 4,585                                                       |   |                                       | 155,107 |                                       |   | 0                   |   |   |   |   |   |   |   |   |   |   |   | 159,692 |   |   |   |   |   | 159,692 |   |
| Comprehensive income                                                                    |   |                                                                             |   |                      |   |                 |       |   |   |                                                        |   |                                       |    |                                       |   | 0                   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Changes in actuarial gains (losses) and past service costs, net of tax effect of $-246  |   | 0                                                                                |   | 0                         |   |                 | 0          |   |   | 0                                                           |   |                                       | 0       |                                       |   | 0                   |   |   | -283 |   |   | 0 |   |   | 0 |   |   | -283 |   |   | 0 |   |   | -283 |   |
| Foreign currency translation adjustment, net of tax effect of $0                        |   | 0                                                                                |   | 0                         |   |                 | 0          |   |   | 0                                                           |   |                                       | 0       |                                       |   | 0                   |   |   | 0 |   |   | -7,064 |   |   | 0 |   |   | -7,064 |   |   | 252 |   |   | -6,812 |   |
| Change in fair value of cash flow hedges, net of tax effect of $257                     |   | 0                                                                                |   | 0                         |   |                 | 0          |   |   | 0                                                           |   |                                       | 0       |                                       |   | 0                   |   |   | 0 |   |   | 0 |   |   | -585 |   |   | -585 |   |   | 0 |   |   | -585 |   |
| Net income                                                                              |   | 0                                                                                |   | 0                         |   |                 | 0          |   |   | 0                                                           |   |                                       | 0       |                                       |   | 87,259              |   |   | 0 |   |   | 0 |   |   | 0 |   |   | 87,259 |   |   | 4,779 |   |   | 92,038 |   |
| Total comprehensive income                                                              |   | 0                                                                                |   | 0                         |   |                 | 0          |   |   | 0                                                           |   |                                       | 0       |                                       |   | 87,259              |   |   | -283 |   |   | -7,064 |   |   | -585 |   |   | 79,327 |   |   | 5,031 |   |   | 84,358 |   |
| December 31, 2010                                                                       |   | 0                                                                                |   | 0                         |   |                 | 28,220,041 |   |   | 36,528                                                      |   |                                       | 651,038 |                                       |   | -68,858             |   |   | 11,950 |   |   | 10,641 |   |   | -585 |   | $ | 640,714 |   |   | 15,515 |   | $ | 656,229 |   |

----

|                                                                           |   | 2010   |     |   | 2009   |   |     | 2008   |   |
|--------------------------------------------------------------------------------|--------|--------|----------|--------|--------|--------|----------|--------|--------|
| Cash flows from operating activities                                           |   |   |     |   |   |   |     |   |   |
| Net income (loss)                                                              |   | $      | 92,038   |   |   | $      | 52,344   |   |   | $ | -87,092 |   |
| Adjustments to reconcile net income (loss) to cash from operating activities   |   |   |     |   |   |   |     |   |   |   |   |   |
| Depreciation, amortization and impairment losses                               |   |   | 87,861   |   |   |   | 88,618   |   |   |   | 87,380 |   |
| Share-based compensation expense (credit)                                      |   |   | -13,214  |   |   |   | -33,250  |   |   |   | 90,700 |   |
| Gain on sale of other long-lived assets, net                                   |   |   | 1,050    |   |   |   | -2,506   |   |   |   | -1,807 |   |
| Accrued interest                                                               |   |   | 1,191    |   |   |   | 2,631    |   |   |   | 26,386 |   |
| Dividends from equity accounted investees, net of income in earnings           |   |   | 2,329    |   |   |   | 2,176    |   |   |   | 1,724 |   |
| Changes in operating assets and liabilities                                    |   |   |     |   |   |   |     |   |   |   |   |   |
| Change in accounts receivable                                                  |   |   | -19,595  |   |   |   | 32,419   |   |   |   | -29,937 |   |
| Change in accounts payable                                                     |   |   | 12,216   |   |   |   | -14,161  |   |   |   | 35,435 |   |
| Change in inventories                                                          |   |   | -10,361  |   |   |   | 53,180   |   |   |   | -19,822 |   |
| Change in other assets and liabilities                                         |   |   | -12,192  |   |   |   | -61,830  |   |   |   | 11,178 |   |
| Cash flows from operating activities                                           |   | $      | 141,323  |   |   | $      | 119,621  |   |   | $ | 114,145 |   |
|                                                                           |   |   |     |   |   |   |     |   |   |   |   |   |
| Purchases of property, plant and equipment and intangible assets               |   |   | -42,391  |   |   |   | -30,492  |   |   |   | -81,812 |   |
| Proceeds from disposals of property, plant and equipment and intangible assets |   |   | 11,938   |   |   |   | 14,838   |   |   |   | 3,746 |   |
| Proceeds from shareholder loan payments                                        |   |   | 2,485    |   |   |   | 0        |   |   |   | 0 |   |
| Business combinations, net of cash acquired                                    |   |   | 0        |   |   |   | -27,389  |   |   |   | -2,700 |   |
| Proceeds from disposition of equity accounted investees                        |   |   | 0        |   |   |   | 0        |   |   |   | 1,772 |   |
| Net cash flow from (used in) investing activities                              |   | $      | -27,968  |   |   | $      | -43,043  |   |   | $ | -78,994 |   |
|                                                                           |   |   |     |   |   |   |     |   |   |   |   |   |
| Cash flows from financing activities                                           |   |   |     |   |   |   |     |   |   |   |   |   |
| Proceeds from bank borrowings                                                  |   |   | 63,560   |   |   |   | 84,555   |   |   |   | 130,664 |   |
| Repayment of bank borrowings                                                   |   |   | -184,771 |   |   |   | -157,835 |   |   |   | -122,717 |   |
| Capital increase, net of IPO costs                                             |   |   | 153,254  |   |   |   | 0        |   |   |   | 0 |   |
| Repayment of capital lease obligations                                         |   |   | -1,084   |   |   |   | -1,103   |   |   |   | -940 |   |
| Repayment of shareholder loan                                                  |   |   | -6,752   |   |   |   | 0        |   |   |   | 0 |   |
| Purchase of noncontrolling interests                                           |   |   | 0        |   |   |   | 0        |   |   |   | -10,337 |   |
| Dividends to noncontrolling interests                                          |   |   | -831     |   |   |   | -3,048   |   |   |   | -5,359 |   |
| Sale of noncontrolling interest in subsidiary                                  |   |   | 2,034    |   |   |   | 0        |   |   |   | 0 |   |
| Net cash flow from (used in) financing activities                              |   | $      | 25,410   |   |   | $      | -77,431  |   |   | $ | -8,689 |   |
|                                                                           |   |   |     |   |   |   |     |   |   |   |   |   |
| Net increase (decrease) in cash and cash equivalents                           |   |   | 138,765  |   |   |   | (853     | )      |   |   | 26,462 |   |
| Effect of exchange rate fluctuations on cash held                              |   |   | 2,137    |   |   |   | 1,972    |   |   |   | -5,526 |   |
| Increase of cash through change in scope of consolidation                      |   |   | 0        |   |   |   | 0        |   |   |   | 363 |   |
|                                                                           |   |   |     |   |   |   |     |   |   |   |   |   |
| Cash and cash equivalents at January 1                                         |   | $      | 75,392   |   |   | $      | 74,273   |   |   | $ | 52,974 |   |
| Cash and cash equivalents at December 31                                       |   | $      | 216,294  |   |   | $      | 75,392   |   |   | $ | 74,273 |   |
|                                                                           |   |   |     |   |   |   |     |   |   |   |   |   |
| Income taxes paid                                                              |   |   | 28,667   |   |   |   | 42,657   |   |   |   | 50,577 |   |
| Interest paid                                                                  |   |   | 50,052   |   |   |   | 45,372   |   |   |   | 74,116 |   |

----

| 1. | Corporate information |
|----|-----------------------|

| 2. | Significant accounting policies |
|----|---------------------------------|

----

|   | · | persuasive evidence of an arrangement exists; |
|--------|--------|-----------------------------------------------|

|   | · | delivery has occurred; |
|--------|--------|------------------------|

|   | · | the sales price is fixed or determinable; and |
|--------|--------|-----------------------------------------------|

|   | · | collectability is reasonably assured. |
|--------|--------|---------------------------------------|

----

----

----

| Buildings           | 10 to 50 years |
|---------------------|----------------|
| Plant and machinery | 5 to 15 years  |
| Other equipment     | 3 to 12 years  |

----

----

| Customer-related intangible assets            |                 6 to 18 years |
|-----------------------------------------------|---------------------------------------------------------------------------------------------------------------|
| Contract-based intangible assets and software |                 3 to 5 years  |
| Technology-related intangible assets          |                 8 to 15 years |

----

----

|                                 |   | 2010   |    |   | 2009   |   |
|--------------------------------------|--------|--------|---------|--------|--------|--------|
| January 1                            |   | $      | 34,762  |   |   | $      | 32,458 |   |
| Change through business combinations |   |   | 0       |   |   |   | 111 |   |
| Warranty issued                      |   |   | 13,837  |   |   |   | 13,687 |   |
| Utilizations                         |   |   | -13,978 |   |   |   | -10,587 |   |
| Change in estimates and transfers    |   |   | -1,826  |   |   |   | -1,896 |   |
| Foreign exchange fluctuation         |   |   | -1,231  |   |   |   | 989 |   |
| December 31                          |   | $      | 31,564  |   |   | $      | 34,762 |   |
|                                 |   |   |    |   |   |   |   |   |
| Thereof:                             |   |   |    |   |   |   |   |   |
| Current                              |   |   | 31,564  |   |   |   | 34,762 |   |
| Noncurrent                           |   |   | 0       |   |   |   | 0 |   |

----

| 3. | Discontinued operations |
|----|-------------------------|

| 4. | Business combinations |
|----|-----------------------|

----

|                                                          |   | FairValues |   |   | Useful Life (Years) |       |
|---------------------------------------------------------------|--------|------------|--------|--------|-------------------------------|------------|
| Current assets, including cash and cash equivalents of $2,633 |   | $          | 8,569  |   |                          |       |   |
| Property, plant and equipment                                 |   |       | 486    |   |                          | various    |   |
| Other intangible assets                                       |   |       | 0      |   |                          |       |   |
| Tradenames                                                    |   |       | 2,482  |   |                          | indefinite |   |
| Customer relationship                                         |   |       | 8,468  |   |                          |       | 6 |   |
| Technology-based intangible assets                            |   |       | 5,195  |   |                          |       | 6 |   |
| Other noncurrent assets                                       |   |       | 145    |   |                          |       |   |   |
| Deferred tax assets                                           |   |       | 1,104  |   |                          |       |   |   |
| Trade payables                                                |   |       | -937   |   |                          |       |   |   |
| Other current liabilities                                     |   |       | -4,684 |   |                          |       |   |   |
| Deferred tax liabilities                                      |   |       | -5,556 |   |                          |       |   |   |
| Total fair value of net assets acquired                       |   |       | 15,272 |   |                          |       |   |   |
| Total purchase price                                          |   | $          | 63,603 |   |                          |       |   |   |
| Goodwill                                                      |   | $          | 48,331 |   |                          |       |   |   |

| 5. | Employee termination and exit costs |
|----|-------------------------------------|

----

|                           |   | Gas            |   |   | Electricity |   |   | Water  |   |
|-------------------------------------|--------|----------------|--------|--------|-------------|--------|--------|--------|--------|
|                                |   | 2010           |   |   | 2009        |   |   | 2008   |   |   | 2010 |   |   | 2009 |   |   | 2008 |   |   | 2010 |   |   | 2009 |   |   | 2008 |   |
|                                |   |           |   |   |        |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Employee termination and exit costs |   | $              | 332    |   |        | $      | 16,880 |   |   | $ | 5,803 |   |   | $ | 2,170 |   |   | $ | 842 |   |   | $ | 229 |   |   | $ | 3,715 |   |   | $ | 7,310 |   |   | $ | 4,425 |   |
|                                |   |           |   |   |        |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|                                |   | Total segments |   |   | Corporate   |   |   | Total  |   |
|                                |   | 2010           |   |   | 2009        |   |   | 2008   |   |   | 2010 |   |   | 2009 |   |   | 2008 |   |   | 2010 |   |   | 2009 |   |   | 2008 |   |
|                                |   |           |   |   |        |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Employee termination and exit costs |   | $              | 6,217  |   |        | $      | 25,032 |   |   | $ | 10,457 |   |   | $ | - |   |   | $ | 331 |   |   | $ | - |   |   | $ | 6,217 |   |   | $ | 25,363 |   |   | $ | 10,457 |   |

----

|                                |   | 2010   |   |   | 2009   |   |   | 2008   |   |
|-------------------------------------|--------|--------|--------|--------|--------|--------|--------|--------|--------|
| Cost of revenues                    |   | $      | 3,492  |   |   | $      | 18,847 |   |   | $ | 4,800 |   |
| Selling expenses                    |   |   | 861    |   |   |   | 2,912  |   |   |   | 1,589 |   |
| General and administrative expenses |   |   | 1,864  |   |   |   | 2,440  |   |   |   | 3,106 |   |
| Research and development expenses   |   |   | 0      |   |   |   | 1,164  |   |   |   | 962 |   |
|                                |   | $      | 6,217  |   |   | $      | 25,363 |   |   | $ | 10,457 |   |

|              |   | Liability atJanuary 1,2010 |   |   | Accrued |   |   | PaymentsMade |   |   | Releases |   |   | ForeignExchangeRateChange |   |   | Liability atDecember31, 2010 |   |
|-------------------|--------|--------------------------------------|--------|--------|---------|--------|--------|--------------|--------|--------|----------|--------|--------|---------------------------|--------|--------|----------------------------------------|--------|
| Accrued liability |   | $                                    | 10,768 |   |    | $      | 2,131  |         |   | $      | -8,905   |   |   | $                         | -1,161 |   |                                   | $      | -610 |   |   | $ | 2,223 |   |
| Thereof:          |   |                                 |   |   |    |   |   |         |   |   |     |   |   |                      |   |   |                                   |   |   |   |   |   |   |   |
| Current           |   |                                 | 9,884  |   |    |   |   |         |   |   |     |   |   |                      |   |   |                                   |   |   |   |   |   | 2,223 |   |
| Noncurrent        |   |                                 | 884    |   |    |   |   |         |   |   |     |   |   |                      |   |   |                                   |   |   |   |   |   | 0 |   |

|              |   | Liability atJanuary 1,2009 |   |   | Accrued |   |   | PaymentsMade |   |   | Releases |   |   | ForeignExchangeRateChange |   |   | Liability atDecember31, 2009 |   |
|-------------------|--------|--------------------------------------|--------|--------|---------|--------|--------|--------------|--------|--------|----------|--------|--------|---------------------------|--------|--------|----------------------------------------|--------|
| Accrued liability |   | $                                    | 2,219  |   |    | $      | 10,104 |         |   | $      | -1,879   |   |   | $                         | -217   |   |                                   | $      | 541 |   |   | $ | 10,768 |   |
| Thereof:          |   |                                 |   |   |    |   |   |         |   |   |     |   |   |                      |   |   |                                   |   |   |   |   |   |   |   |
| Current           |   |                                 | 2,096  |   |    |   |   |         |   |   |     |   |   |                      |   |   |                                   |   |   |   |   |   | 9,884 |   |
| Noncurrent        |   |                                 | 123    |   |    |   |   |         |   |   |     |   |   |                      |   |   |                                   |   |   |   |   |   | 884 |   |

| 6. | Interest expense, net |
|----|-----------------------|

|                                                                                  |   | 2010   |   |   | 2009   |   |   | 2008   |   |
|---------------------------------------------------------------------------------------|--------|--------|--------|--------|--------|--------|--------|--------|--------|
| Interest income                                                                       |   |   |   |   |   |   |   |   |   |
| Interest income on bank deposits                                                      |   | $      | 1,741  |   |   | $      | 2,467  |   |   | $ | 2,574 |   |
| Other                                                                                 |   |   | 165    |   |   |   | 102    |   |   |   | 210 |   |
|                                                                                  |   |   | 1,906  |   |   |   | 2,569  |   |   |   | 2,784 |   |
|                                                                                  |   |   |   |   |   |   |   |   |   |   |   |   |
| Interest expense                                                                      |   |   |   |   |   |   |   |   |   |   |   |   |
| Interest on debt                                                                      |   |   | 35,290 |   |   |   | 38,158 |   |   |   | 77,604 |   |
| Payments (receipts) from interest rate swaps                                          |   |   | 13,189 |   |   |   | 8,713  |   |   |   | -5,839 |   |
| Interest on mandatorily redeemable preferred equity certificates and shareholder loan |   |   | 280    |   |   |   | 369    |   |   |   | 26,353 |   |
| Change in fair value of interest rate swaps                                           |   |   | 5,016  |   |   |   | 3,824  |   |   |   | 16,770 |   |
| Other                                                                                 |   |   | 8,214  |   |   |   | 6,929  |   |   |   | 5,159 |   |
|                                                                                  |   |   | 61,989 |   |   |   | 57,993 |   |   |   | 120,047 |   |
|                                                                                  |   |   |   |   |   |   |   |   |   |   |   |   |
| Interest expense, net                                                                 |   | $      | 60,083 |   |   | $      | 55,424 |   |   | $ | 117,263 |   |

----

| 7. | Income taxes |
|----|--------------|

|                                          |   | 2010   |    |   | 2009   |   |   | 2008   |   |
|-----------------------------------------------|--------|--------|---------|--------|--------|--------|--------|--------|--------|
| Current income tax                            |   |   |    |   |   |   |   |   |   |
| Germany                                       |   | $      | 12,543  |   |   | $      | 10,339 |   |   | $ | 9,779 |   |
| Foreign                                       |   |   | 38,136  |   |   |   | 31,543 |   |   |   | 29,293 |   |
|                                          |   | $      | 50,679  |   |   | $      | 41,882 |   |   | $ | 39,072 |   |
|                                          |   |   |    |   |   |   |   |   |   |   |   |   |
| Deferred income tax                           |   |   |    |   |   |   |   |   |   |   |   |   |
| Germany                                       |   | $      | -9,963  |   |   | $      | -158   |   |   | $ | -4,609 |   |
| Foreign                                       |   |   | -11,314 |   |   |   | -2,375 |   |   |   | -3,565 |   |
|                                          |   | $      | -21,277 |   |   | $      | -2,533 |   |   | $ | -8,174 |   |
|                                          |   |   |    |   |   |   |   |   |   |   |   |   |
| Income tax expense from continuing operations |   | $      | 29,402  |   |   | $      | 39,349 |   |   | $ | 30,898 |   |

|    |   | 2010   |    |   | 2009   |   |    | 2008   |   |
|---------|--------|--------|---------|--------|--------|--------|---------|--------|--------|
| Germany |   |   | -6,666  |   |   |   | -28,809 |   |   |   | -82,436 |   |
| Foreign |   |   | 125,536 |   |   |   | 120,502 |   |   |   | 26,242 |   |
|    |   | $      | 118,870 |   |   | $      | 91,693  |   |   | $ | -56,194 |   |

|                                                       |   | 2010   |   |   | 2009   |   |   | 2008   |   |
|------------------------------------------------------------|--------|--------|--------|--------|--------|--------|--------|--------|--------|
| Income tax from continuing operations                      |   | $      | 29,402 |   |   | $      | 39,349 |   |   | $ | 30,898 |   |
| Income tax recognized in other comprehensive income (loss) |   |   | -11    |   |   |   | -2,657 |   |   |   | -9,328 |   |
| Income tax recognized in additional paid-in capital        |   |   | -6,438 |   |   |   | 0      |   |   |   | 0 |   |
|                                                       |   | $      | 22,953 |   |   | $      | 36,692 |   |   | $ | 21,570 |   |

----

|                                                              |   | 2010   |    |   | 2009   |   |   | 2008   |   |
|-------------------------------------------------------------------|--------|--------|---------|--------|--------|--------|--------|--------|--------|
| Income (loss) from continuing operations before taxes             |   | $      | 118,870 |   |   | $      | 91,693 |   |   | $ | -56,194 |   |
|                                                              |   |   |    |   |   |   |   |   |   |   |   |   |
| "Expected" income tax expense (benefit)                           |   |   | 18,817  |   |   |   | 14,515 |   |   |   | -8,896 |   |
|                                                              |   |   |    |   |   |   |   |   |   |   |   |   |
| Foreign tax rate differentials                                    |   |   | 5,614   |   |   |   | 2,995  |   |   |   | 2,531 |   |
| German municipal trade tax                                        |   |   | 7,327   |   |   |   | 6,431  |   |   |   | 5,065 |   |
| Tax exempt income                                                 |   |   | -1,011  |   |   |   | -2,636 |   |   |   | -1,040 |   |
| Non deductible expenses                                           |   |   | 3,355   |   |   |   | 4,354  |   |   |   | 6,484 |   |
| Tax effects arising from management equity program                |   |   | -2,155  |   |   |   | -5,263 |   |   |   | 14,358 |   |
| Uncertain tax positions                                           |   |   | 1,101   |   |   |   | 8,175  |   |   |   | 2,870 |   |
| Prior year tax adjustments                                        |   |   | -2,735  |   |   |   | -71    |   |   |   | -3,204 |   |
| Changes in tax rate and tax law                                   |   |   | -1,104  |   |   |   | 308    |   |   |   | 560 |   |
| Changes in valuation allowances                                   |   |   | 2,674   |   |   |   | 12,560 |   |   |   | 11,380 |   |
| Tax effects from basis differences in investments in subsidiaries |   |   | -668    |   |   |   | 366    |   |   |   | 1,361 |   |
| Tax credits                                                       |   |   | -1,670  |   |   |   | -3,224 |   |   |   | -1,370 |   |
| Withholding tax effects                                           |   |   | 930     |   |   |   | 1,576  |   |   |   | 980 |   |
| Others                                                            |   |   | -1,073  |   |   |   | -737   |   |   |   | -181 |   |
| Actual income tax expense                                         |   | $      | 29,402  |   |   | $      | 39,349 |   |   | $ | 30,898 |   |
|                                                              |   |   |    |   |   |   |   |   |   |   |   |   |
| Effective income tax rate                                         |   |   | 24.7    | %      |   |   | 42.9   | %      |   |   | -55.0 | % |

|                                       |   | 2010                   |    |   | 2009                       |   |
|--------------------------------------------|--------|------------------------|---------|--------|----------------------------|--------|
|                                       |   | Deferred TaxAsset |    |   | Deferred TaxLiability |   |   | Deferred TaxAsset |   |   | Deferred TaxLiability |   |
| Inventories                                |   |                   | 5,772   |   |                       |   | 145 |   |   |   | 6,078 |   |   |   | 371 |   |
| Receivables and other assets               |   |                   | 5,501   |   |                       |   | 7,901 |   |   |   | 6,935 |   |   |   | 19,411 |   |
| Prepaid expenses                           |   |                   | 66      |   |                       |   | 2,916 |   |   |   | 53 |   |   |   | 1,670 |   |
| Tangible fixed assets                      |   |                   | 2,122   |   |                       |   | 26,043 |   |   |   | 3,555 |   |   |   | 32,433 |   |
| Other intangible assets                    |   |                   | 9,746   |   |                       |   | 68,379 |   |   |   | 8,778 |   |   |   | 84,690 |   |
| Goodwill                                   |   |                   | 0       |   |                       |   | 4,477 |   |   |   | 0 |   |   |   | 4,681 |   |
| Shares in related companies                |   |                   | 0       |   |                       |   | 2,668 |   |   |   | 0 |   |   |   | 3,174 |   |
| Provisions for pensions                    |   |                   | 22,097  |   |                       |   | 0 |   |   |   | 26,765 |   |   |   | 0 |   |
| Other liabilities                          |   |                   | 20,120  |   |                       |   | 6,655 |   |   |   | 35,821 |   |   |   | 16,881 |   |
| Tax loss and tax credit carryforwards      |   |                   | 41,917  |   |                       |   |   |   |   |   | 38,405 |   |   |   |   |   |
| Valuation allowance on deferred tax assets |   |                   | -30,756 |   |                       |   | 0 |   |   |   | -30,977 |   |   |   | 0 |   |
|                                       |   | $                      | 76,585  |   |                       | $      | 119,184 |   |   | $ | 95,413 |   |   | $ | 163,311 |   |
| Net deferred tax liabilities               |   |                   |    |   |                       | $      | -42,599 |   |   |   |   |   |   | $ | -67,898 |   |

----

| Expiration of tax loss carryforwards |   |   |   |
|--------------------------------------|--------|--------|--------|
| Within one year                      |   | $      | 3,799  |   |
| Within two years                     |   |   | 3,716  |   |
| Within three years                   |   |   | 0      |   |
| Within four years                    |   |   | 0      |   |
| Within five years and later          |   |   | 19,011 |   |
| Indefinite                           |   |   | 71,557 |   |
| Total tax loss carryforwards         |   | $      | 98,083 |   |

| Valuation Allowances arising from            |   | TemporaryDifferences |   |   | TaxLossesCarry-forward |   |    | Total  |   |
|-------------------------------------------------------------|--------|----------------------|--------|--------|------------------------|--------|---------|--------|--------|
| As of December 31, 2007                                     |   | $                    | 1,751  |   |                   | $      | 40,611  |   |   | $ | 42,362 |   |
| Charged (credited) to income tax provision (benefit)        |   |                 | 657    |   |                   |   | 14,785  |   |   |   | 15,442 |   |
| Reversals                                                   |   |                 | -350   |   |                   |   | 0       |   |   |   | -350 |   |
| Utilization / Expiration of tax losses                      |   |                 | 0      |   |                   |   | -3,299  |   |   |   | -3,299 |   |
| Effect of foreign exchange fluctuation and tax rate changes |   |                 | 47     |   |                   |   | -10,466 |   |   |   | -10,419 |   |
| As of December 31, 2008                                     |   | $                    | 2,105  |   |                   | $      | 41,631  |   |   | $ | 43,736 |   |
| Charged (credited) to income tax provision (benefit)        |   |                 | 15     |   |                   |   | 18,346  |   |   |   | 18,361 |   |
| Reversals                                                   |   |                 | -2,096 |   |                   |   | 0       |   |   |   | -2,096 |   |
| Utilization / Expiration of tax losses                      |   |                 | 0      |   |                   |   | -29,059 |   |   |   | -29,059 |   |
| Effect of foreign exchange fluctuation and tax rate changes |   |                 | 422    |   |                   |   | -387    |   |   |   | 35 |   |
| As of December 31, 2009                                     |   | $                    | 446    |   |                   | $      | 30,531  |   |   | $ | 30,977 |   |
| Charged (credited) to income tax provision (benefit)        |   |                 | 828    |   |                   |   | 3,307   |   |   |   | 4,135 |   |
| Reversals                                                   |   |                 | -701   |   |                   |   | 0       |   |   |   | -701 |   |
| Utilization / Expiration of tax losses                      |   |                 | 0      |   |                   |   | -1,736  |   |   |   | -1,736 |   |
| Effect of foreign exchange fluctuation and tax rate changes |   |                 | 9      |   |                   |   | -1,928  |   |   |   | -1,919 |   |
| As of December 31, 2010                                     |   | $                    | 582    |   |                   | $      | 30,174  |   |   | $ | 30,756 |   |

----

|                                                  |   | 2010   |   |   | 2009   |   |   | 2008   |   |
|-------------------------------------------------------|--------|--------|--------|--------|--------|--------|--------|--------|--------|
| Balance at the beginning of the year                  |   | $      | 41,786 |   |   | $      | 23,184 |   |   | $ | 15,502 |   |
| Additions for tax positions taken in the current year |   |   | 11,506 |   |   |   | 18,271 |   |   |   | 8,114 |   |
| Reductions for tax positions taken in prior years     |   |   |   |   |   |   |   |   |   |   |   |   |
| Settlement                                            |   |   | -1,325 |   |   |   | -130   |   |   |   | -31 |   |
| Lapse of statute of limitation                        |   |   | -3,036 |   |   |   | 0      |   |   |   | 0 |   |
| Payments made                                         |   |   | -570   |   |   |   | 0      |   |   |   | 0 |   |
| Effects of exchange rate changes                      |   |   | -698   |   |   |   | 461    |   |   |   | -401 |   |
| Balance at the end of the year                        |   | $      | 47,663 |   |   | $      | 41,786 |   |   | $ | 23,184 |   |

| Major tax jurisdictions |   | Years Subject to Examination |
|-------------------------|--------|------------------------------|
| Germany                 |   | Subsequent to 2004           |
| U.S. Federal            |   | Subsequent to 2005           |

----

| 8. | Earnings (loss) per share |
|----|---------------------------|

|                                                                                                   |   | 2010   |       |   | 2009   |   |       | 2008   |   |
|--------------------------------------------------------------------------------------------------------|--------|--------|------------|--------|--------|--------|------------|--------|--------|
| Numerator - Basic and Dilutive                                                                         |   |   |       |   |   |   |       |   |   |
| Income (loss) from continuing operations attributable to Elster Group SE                               |   | $      | 84,689     |   |   | $      | 48,888     |   |   | $ | -91,738 |   |
| Accretion of dividends on preferred shares                                                             |   |   | -19,210    |   |   |   | -25,640    |   |   |   | -961 |   |
| Income (loss) from continuing operations attributable to Elster Group SE - basic and dilutive          |   | $      | 65,479     |   |   | $      | 23,248     |   |   | $ | -92,699 |   |
| Income (loss) from discontinued operations                                                             |   |   | 2,570      |   |   |   | -          |   |   |   | - |   |
| Net income (loss) attributable to ordinary shareholders - basic and diluted                            |   | $      | 68,049     |   |   | $      | 23,248     |   |   | $ | -92,699 |   |
|                                                                                                   |   |   |       |   |   |   |       |   |   |   |   |   |
| Denominator - Basic and Dilutive                                                                       |   |   |       |   |   |   |       |   |   |   |   |   |
| Basic weighted average number of ordinary shares outstanding, adjusted for stock split (see note 15)   |   |   | 19,295,573 |   |   |   | 16,320,750 |   |   |   | 16,320,750 |   |
|                                                                                                   |   |   |       |   |   |   |       |   |   |   |   |   |
| Effect of dilutive securities - unvested shares                                                        |   |   | 4,204      |   |   |   | -          |   |   |   | - |   |
| Diluted weighted average number of ordinary shares outstanding, adjusted for stock split (see note 15) |   |   | 19,299,777 |   |   |   | 16,320,750 |   |   |   | 16,320,750 |   |

| 9. | Accounts receivable |
|----|---------------------|

|                                           |   | 2010   |    |   | 2009   |   |
|------------------------------------------------|--------|--------|---------|--------|--------|--------|
| Customer contracts                             |   | $      | 21,453  |   |   | $      | 12,791 |   |
| Trade accounts receivables                     |   |   | 266,496 |   |   |   | 260,198 |   |
| Accounts receivable before valuation allowance |   | $      | 287,949 |   |   | $      | 272,989 |   |
| Less valuation allowance                       |   |   | -9,732  |   |   |   | -7,337 |   |
| Accounts receivable                            |   | $      | 278,217 |   |   | $      | 265,652 |   |

|                     |   | 2010   |     |   | 2009   |   |
|--------------------------|--------|--------|----------|--------|--------|--------|
| Aggregate costs incurred |   | $      | 163,493  |   |   | $      | 95,373 |   |
| Recognized profits       |   |   | 25,842   |   |   |   | 16,956 |   |
| Recognized losses        |   |   | -424     |   |   |   | -273 |   |
| Progress billings        |   |   | -167,458 |   |   |   | -99,265 |   |
| Customer contracts       |   | $      | 21,453   |   |   | $      | 12,791 |   |

|                                 |   | 2010   |   |   | 2009   |   |   | 2008   |   |
|--------------------------------------|--------|--------|--------|--------|--------|--------|--------|--------|--------|
| Balance at the beginning of the year |   | $      | 7,337  |   |   | $      | 9,031  |   |   | $ | 7,912 |   |
| Additions                            |   | $      | 4,506  |   |   | $      | 3,707  |   |   | $ | 3,633 |   |
| Write offs                           |   |   | -2,232 |   |   |   | -5,732 |   |   |   | -1,786 |   |
| Effects of exchange rate changes     |   |   | 121    |   |   |   | 331    |   |   |   | -728 |   |
| Balance at the end of the year       |   | $      | 9,732  |   |   | $      | 7,337  |   |   | $ | 9,031 |   |

----

| 10. | Inventories |
|-----|-------------|

|             |   | 2010   |    |   | 2009   |   |
|------------------|--------|--------|---------|--------|--------|--------|
| Raw materials    |   | $      | 130,456 |   |   | $      | 116,293 |   |
| Work in progress |   |   | 17,509  |   |   |   | 16,457 |   |
| Finished goods   |   |   | 37,307  |   |   |   | 35,258 |   |
|             |   | $      | 185,272 |   |   | $      | 168,008 |   |
| Reserves         |   |   | -30,723 |   |   |   | -20,217 |   |
| Inventories      |   | $      | 154,549 |   |   | $      | 147,791 |   |

| 11. | Property, plant and equipment |
|-----|-------------------------------|

| 2010                          |   | Cost   |    |   | AccumulatedDeprecation |   |    | Net    |   |
|-------------------------------|--------|--------|---------|--------|------------------------|--------|---------|--------|--------|
| Land                          |   | $      | 31,584  |   |                   | $      | 328     |   |   | $ | 31,256 |   |
| Buildings                     |   |   | 59,139  |   |                   |   | 18,183  |   |   |   | 40,956 |   |
| Plant and machinery           |   |   | 186,301 |   |                   |   | 87,282  |   |   |   | 99,019 |   |
| Other equipment               |   |   | 32,464  |   |                   |   | 10,758  |   |   |   | 21,706 |   |
| Construction in process       |   |   | 10,621  |   |                   |   | 659     |   |   |   | 9,962 |   |
| Property, plant and equipment |   | $      | 320,109 |   |                   | $      | 117,210 |   |   | $ | 202,899 |   |
|                          |   |   |    |   |                   |   |    |   |   |   |   |   |
| 2009                          |   | Cost   |    |   | AccumulatedDeprecation |   |    | Net    |   |
| Land                          |   | $      | 35,678  |   |                   | $      | 427     |   |   | $ | 35,251 |   |
| Buildings                     |   |   | 63,930  |   |                   |   | 10,915  |   |   |   | 53,015 |   |
| Plant and machinery           |   |   | 161,264 |   |                   |   | 46,081  |   |   |   | 115,183 |   |
| Other equipment               |   |   | 25,942  |   |                   |   | 2,299   |   |   |   | 23,643 |   |
| Construction in process       |   |   | 7,671   |   |                   |   | 520     |   |   |   | 7,151 |   |
| Property, plant and equipment |   | $      | 294,485 |   |                   | $      | 60,242  |   |   | $ | 234,243 |   |

----

| 12. | Goodwill and other intangible assets |
|-----|--------------------------------------|

| 2010                                 |   | Cost   |    |   | AccumulatedAmortization |   |    | Net    |   |
|--------------------------------------|--------|--------|---------|--------|-------------------------|--------|---------|--------|--------|
| Trade names and brands               |   | $      | 27,493  |   |                    | $      | 8,817   |   |   | $ | 18,676 |   |
| Customer related assets              |   |   | 217,608 |   |                    |   | 99,356  |   |   |   | 118,252 |   |
| Contract-based intangible assets     |   |   | 56,913  |   |                    |   | 43,968  |   |   |   | 12,945 |   |
| Technology-related intangible assets |   |   | 146,973 |   |                    |   | 80,440  |   |   |   | 66,533 |   |
| Other intangible assets              |   | $      | 448,987 |   |                    | $      | 232,581 |   |   | $ | 216,406 |   |
| Goodwill                             |   | $      | 936,950 |   |                    | $      | -       |   |   | $ | 936,950 |   |
|                                 |   |   |    |   |                    |   |    |   |   |   |   |   |
| 2009                                 |   | Cost   |    |   | AccumulatedAmortization |   |    | Net    |   |
| Trade names and brands               |   | $      | 28,584  |   |                    | $      | 7,982   |   |   | $ | 20,602 |   |
| Customer related assets              |   |   | 223,071 |   |                    |   | 78,667  |   |   |   | 144,404 |   |
| Contract-based intangible assets     |   |   | 47,795  |   |                    |   | 36,460  |   |   |   | 11,335 |   |
| Technology-related intangible assets |   |   | 161,954 |   |                    |   | 74,451  |   |   |   | 87,503 |   |
| Other intangible assets              |   | $      | 461,404 |   |                    | $      | 197,560 |   |   | $ | 263,844 |   |
| Goodwill                             |   | $      | 981,571 |   |                    | $      | -       |   |   | $ | 981,571 |   |

| 2011 |   | $      | 40,474 |   |
|------|--------|--------|--------|--------|
| 2012 |   |   | 35,685 |   |
| 2013 |   |   | 28,111 |   |
| 2014 |   |   | 23,815 |   |
| 2015 |   |   | 18,640 |   |

----

|                         |   | Gas    |    |   | Electricity |   |    | Water  |   |   | Consolidated |   |
|------------------------------|--------|--------|---------|--------|-------------|--------|---------|--------|--------|--------|--------------|--------|
| December 31, 2008            |   | $      | 582,541 |   |        | $      | 179,636 |   |   | $      | 151,482      |   |   | $ | 913,659 |   |
| Additions                    |   |   | 0       |   |        |   | 48,331  |   |   |   | 3,822        |   |   |   | 52,153 |   |
| Foreign currency translation |   |   | 12,825  |   |        |   | 2,934   |   |   |   | 0            |   |   |   | 15,759 |   |
| December 31, 2009            |   | $      | 595,366 |   |        | $      | 230,901 |   |   | $      | 155,304      |   |   | $ | 981,571 |   |
| Disposal of business         |   |   | 0       |   |        |   | -695    |   |   |   | 0            |   |   |   | -695 |   |
| Foreign currency translation |   |   | -31,602 |   |        |   | -12,324 |   |   |   | 0            |   |   |   | -43,926 |   |
| December 31, 2010            |   | $      | 563,764 |   |        | $      | 217,882 |   |   | $      | 155,304      |   |   | $ | 936,950 |   |

| 13. | Pension and other long-term employee benefits |
|-----|-----------------------------------------------|

----

| Net periodic benefit cost |   | Pension Benefits |   |   | Other Benefits |   |
|---------------------------|--------|------------------|--------|--------|----------------|--------|
|                      |   | 2010             |   |   | 2009           |   |   | 2008 |   |   | 2010 |   |   | 2009 |   |   | 2008 |   |
| Service cost              |   | $                | 1,170  |   |           | $      | 1,106 |   |   | $ | 1,292 |   |   | $ | 1,366 |   |   | $ | 3,068 |   |   | $ | 2,134 |   |
| Interest cost             |   |             | 4,800  |   |           |   | 5,115 |   |   |   | 4,630 |   |   |   | 378 |   |   |   | 463 |   |   |   | 494 |   |
| Gain on curtailments      |   |             | 0      |   |           |   | -74 |   |   |   | 0 |   |   |   | 0 |   |   |   | 0 |   |   |   | 0 |   |
| Amortization of net gain  |   |             | -122   |   |           |   | -507 |   |   |   | -653 |   |   |   | 0 |   |   |   | 0 |   |   |   | 0 |   |
| Net periodic benefit cost |   | $                | 5,848  |   |           | $      | 5,640 |   |   | $ | 5,269 |   |   | $ | 1,744 |   |   | $ | 3,531 |   |   | $ | 2,628 |   |

| Change in Benefit Obligation            |   | Pension Benefits |    |   | Other Benefits |   |
|-----------------------------------------|--------|------------------|---------|--------|----------------|--------|
|                                    |   | 2010             |    |   | 2009           |   |   | 2010 |   |   | 2009 |   |
| Benefit obligation at beginning of year |   | $                | 102,111 |   |           | $      | 91,799 |   |   | $ | 9,151 |   |   | $ | 9,166 |   |
| Service cost                            |   |             | 1,170   |   |           |   | 1,106 |   |   |   | 1,366 |   |   |   | 3,068 |   |
| Interest cost                           |   |             | 4,800   |   |           |   | 5,115 |   |   |   | 378 |   |   |   | 463 |   |
| Actuarial loss                          |   |             | 522     |   |           |   | 5,879 |   |   |   | 0 |   |   |   | 0 |   |
| Curtailments/Settlements                |   |             | 0       |   |           |   | -67 |   |   |   | 0 |   |   |   | 0 |   |
| Benefits paid                           |   |             | -4,621  |   |           |   | -4,747 |   |   |   | -2,488 |   |   |   | -3,812 |   |
| Exchange rate changes                   |   |             | -7,334  |   |           |   | 3,026 |   |   |   | -667 |   |   |   | 266 |   |
| Benefit obligation at end of year       |   | $                | 96,648  |   |           | $      | 102,111 |   |   | $ | 7,740 |   |   | $ | 9,151 |   |
| Unfunded status at end of year          |   | $                | 96,648  |   |           | $      | 102,111 |   |   | $ | 7,740 |   |   | $ | 9,151 |   |
|                                    |   |             |    |   |           |   |   |   |   |   |   |   |   |   |   |   |
| Liability consists of:                  |   |             |    |   |           |   |   |   |   |   |   |   |   |   |   |   |
|                                    |   |             |    |   |           |   |   |   |   |   |   |   |   |   |   |   |
|                                    |   | 2010             |    |   | 2009           |   |   | 2010 |   |   | 2009 |   |
|                                    |   |             |    |   |           |   |   |   |   |   |   |   |   |   |   |   |
| Current liabilities                     |   | $                | 4,913   |   |           | $      | 5,186 |   |   | $ | 2,455 |   |   | $ | 2,533 |   |
| Noncurrent liabilities                  |   | $                | 91,735  |   |           | $      | 96,925 |   |   | $ | 5,285 |   |   | $ | 6,618 |   |

|                                                                                        |   | 2010   |   |   | 2009   |   |   | 2008   |   |
|---------------------------------------------------------------------------------------------|--------|--------|--------|--------|--------|--------|--------|--------|--------|
| Actuarial gains, net in the accumulated other comprehensive income at the beginning of year |   | $      | 11,047 |   |   | $      | 17,667 |   |   | $ | 19,540 |   |
| Net actuarial gain (loss) reported in the period                                            |   |   | -482   |   |   |   | -6,106 |   |   |   | -1,220 |   |
| Amortization of actuarial gain, net                                                         |   |   | -122   |   |   |   | -507   |   |   |   | -653 |   |
| Curtailment/Settlement                                                                      |   |   | 0      |   |   |   | -7     |   |   |   | 0 |   |
| Actuarial gains, net in the accumulated other comprehensive income at the end of year       |   | $      | 10,443 |   |   | $      | 11,047 |   |   | $ | 17,667 |   |

----

|                          |   | Pension benefits |   |   | Other benefits |   |
|-------------------------------|--------|-----------------------|--------|--------|---------------------|--------|
|                          |   | 2010                  |   |   | 2009                |   |   | 2010 |   |   | 2009 |   |
| Discount rate                 |   |                  | 5.1    | %      |                |   | 5.3 | % |   |   | 4.8 | % |   |   | 5.1 | % |
| Rate of compensation increase |   |                  | 2.8    | %      |                |   | 2.8 | % |   |   | - |   |   |   | - |   |

|                     |   | Pension Benefits |   |   | Other Benefits |   |
|-------------------------------|--------|-----------------------|--------|--------|---------------------|--------|
|                          |   | 2010                  |   |   | 2009                |   |   | 2008 |   |   | 2010 |   |   | 2009 |   |   | 2008 |   |
| Discount rate                 |   |                  | 5.3    | %      |                |   | 5.7 | % |   |   | 5.5 | % |   |   | 5.1 | % |   |   | 4.9 | % |   |   | 4.3 | % |
| Rate of compensation increase |   |                  | 2.8    | %      |                |   | 2.8 | % |   |   | 2.8 | % |   |   | - |   |   |   | - |   |   |   | - |   |

|              |   | Pension Benefits |   |   | Other Benefits |   |
|-------------------|--------|-----------------------|--------|--------|---------------------|--------|
| 2011              |   | $                     | 4,913  |   |                | $      | 2,454 |   |
| 2012              |   |                  | 5,036  |   |                |   | 1,845 |   |
| 2013              |   |                  | 5,144  |   |                |   | 1,524 |   |
| 2014              |   |                  | 5,468  |   |                |   | 1,328 |   |
| 2015              |   |                  | 5,641  |   |                |   | 1,224 |   |
| Years 2016 - 2020 |   | $                     | 30,743 |   |                | $      | 4,110 |   |

----

| Net periodic benefit cost |   | Pension Benefits |   |   | Other Benefits |   |
|------------------------------------------|--------|-----------------------|--------|--------|---------------------|--------|
|                                     |   | 2010                  |   |   | 2009                |   |   | 2008 |   |   | 2010 |   |   | 2009 |   |   | 2008 |   |
| Service cost                             |   | $                     | 407    |   |                | $      | 411 |   |   | $ | 365 |   |   | $ | 527 |   |   | $ | 418 |   |   | $ | 555 |   |
| Interest cost                            |   |                  | 3,852  |   |                |   | 4,091 |   |   |   | 4,262 |   |   |   | 1,460 |   |   |   | 1,642 |   |   |   | 1,751 |   |
| Expected return on plan assets           |   |                  | -3,412 |   |                |   | -2,967 |   |   |   | -4,225 |   |   |   | 0 |   |   |   | 0 |   |   |   | 0 |   |
| Amortization of prior service cost       |   |                  | 0      |   |                |   | 0 |   |   |   | -78 |   |   |   | -1,174 |   |   |   | -1,260 |   |   |   | -1,176 |   |
| Gain/loss on settlements or curtailments |   |                  | 0      |   |                |   | 106 |   |   |   | 0 |   |   |   | -249 |   |   |   | 0 |   |   |   | 0 |   |
| Amortization of net (gain) loss          |   |                  | 67     |   |                |   | 105 |   |   |   | -557 |   |   |   | -557 |   |   |   | -629 |   |   |   | -739 |   |
| Net periodic benefit cost                |   | $                     | 914    |   |                | $      | 1,746 |   |   | $ | -233 |   |   | $ | 7 |   |   | $ | 171 |   |   | $ | 391 |   |

| Change in benefit obligation                   |   | Pension Benefits |   |   | Other Benefits |   |
|------------------------------------------------|--------|------------------|--------|--------|----------------|--------|
|                                           |   | 2010             |   |   | 2009           |   |   | 2010 |   |   | 2009 |   |
| Benefit obligation at beginning of year        |   | $                | 72,267 |   |           | $      | 66,913 |   |   | $ | 28,377 |   |   | $ | 29,124 |   |
| Service cost                                   |   |             | 407    |   |           |   | 411 |   |   |   | 527 |   |   |   | 418 |   |
| Interest cost                                  |   |             | 3,852  |   |           |   | 4,091 |   |   |   | 1,460 |   |   |   | 1,642 |   |
| Plan participants ́ contributions          |   |             | 94     |   |           |   | 0 |   |   |   | 0 |   |   |   | 0 |   |
| Actuarial loss (gain)                          |   |             | 3,041  |   |           |   | 4,230 |   |   |   | -4,262 |   |   |   | -208 |   |
| Curtailments/Settlements                       |   |             | 0      |   |           |   | -1,043 |   |   |   | -73 |   |   |   | 0 |   |
| Benefits paid                                  |   |             | -3,688 |   |           |   | -5,104 |   |   |   | -2,076 |   |   |   | -2,707 |   |
| Transfers                                      |   |             | -147   |   |           |   | 499 |   |   |   | 0 |   |   |   | 0 |   |
| Exchange rate changes                          |   |             | -706   |   |           |   | 2,270 |   |   |   | 17 |   |   |   | 108 |   |
| Benefit obligation at end of year              |   | $                | 75,120 |   |           | $      | 72,267 |   |   | $ | 23,970 |   |   | $ | 28,377 |   |
|                                           |   |             |   |   |           |   |   |   |   |   |   |   |   |   |   |   |
| Change in plan assets                          |   |             |   |   |           |   |   |   |   |   |   |   |   |   |   |   |
|                                           |   |             |   |   |           |   |   |   |   |   |   |   |   |   |   |   |
|                                           |   | 2010             |   |   | 2009           |   |   | 2010 |   |   | 2009 |   |
| Fair value of plan assets at beginning of year |   | $                | 48,210 |   |           | $      | 39,021 |   |   | $ | - |   |   | $ | - |   |
| Actual return on plan assets                   |   |             | 4,653  |   |           |   | 7,635 |   |   |   | - |   |   |   | - |   |
| Transfers                                      |   |             | -110   |   |           |   | 487 |   |   |   | - |   |   |   | - |   |
| Employer contributions                         |   |             | 3,376  |   |           |   | 5,097 |   |   |   | - |   |   |   | - |   |
| Plan participants ́ contributions          |   |             | 94     |   |           |   | 101 |   |   |   | - |   |   |   | - |   |
| Curtailments/Settlements                       |   |             | 0      |   |           |   | -1,022 |   |   |   | - |   |   |   | - |   |
| Benefits paid                                  |   |             | -3,355 |   |           |   | -4,756 |   |   |   | - |   |   |   | - |   |
| Exchange rate changes                          |   |             | -366   |   |           |   | 1,647 |   |   |   | - |   |   |   | - |   |
| Fair value of plan assets at end of year       |   | $                | 52,502 |   |           | $      | 48,210 |   |   | $ | - |   |   | $ | - |   |
| Unfunded status at end of year                 |   | $                | 22,618 |   |           | $      | 24,057 |   |   | $ | 23,970 |   |   | $ | 28,377 |   |
|                                           |   |             |   |   |           |   |   |   |   |   |   |   |   |   |   |   |
| Liability consists of:                         |   |             |   |   |           |   |   |   |   |   |   |   |   |   |   |   |
|                                           |   |             |   |   |           |   |   |   |   |   |   |   |   |   |   |   |
|                                           |   | 2010             |   |   | 2009           |   |   | 2010 |   |   | 2009 |   |
| Current liabilities                            |   | $                | 4,169  |   |           | $      | 244 |   |   | $ | 1,949 |   |   | $ | 3,343 |   |
| Noncurrent liabilities                         |   | $                | 18,449 |   |           | $      | 23,813 |   |   | $ | 22,021 |   |   | $ | 25,034 |   |

----

|                           |   | 2010 |   |   | 2009   |   |
|--------------------------------|--------|------|--------|--------|--------|--------|
| Projected benefit obligation   |   | $    | 68,122 |   |   | $      | 68,182 |   |
| Accumulated benefit obligation |   | $    | 67,887 |   |   | $      | 67,901 |   |
| Fair value of plan assets      |   | $    | 46,099 |   |   | $      | 44,795 |   |

|                                                                                               |   | 2010   |   |   | 2009   |   |   | 2008   |   |
|----------------------------------------------------------------------------------------------------|--------|--------|--------|--------|--------|--------|--------|--------|--------|
| Actual gains, net accumulated in the other comprehensive income (loss) at the beginning of year    |   | $      | 4,780  |   |   | $      | 4,509  |   |   | $ | 24,588 |   |
| Net actuarial gain (loss) reported in the period                                                   |   |   | 2,399  |   |   |   | 668    |   |   |   | -18,783 |   |
| Amortization of actuarial gain, net                                                                |   |   | -490   |   |   |   | -524   |   |   |   | -1,296 |   |
| Curtailment/Settlement                                                                             |   |   | 0      |   |   |   | 127    |   |   |   | 0 |   |
| Actuarial gains, net accumulated in the other comprehensive income (loss) at the end of year       |   | $      | 6,689  |   |   | $      | 4,780  |   |   | $ | 4,509 |   |
|                                                                                               |   |   |   |   |   |   |   |   |   |   |   |   |
| Past service credits accumulated in the other comprehensive income (loss) at the beginning of year |   | $      | 4,940  |   |   | $      | 6,200  |   |   | $ | 7,454 |   |
| Amortization of past service credits                                                               |   |   | -1,166 |   |   |   | -1,260 |   |   |   | -1,254 |   |
| Curtailment/Settlement                                                                             |   |   | -176   |   |   |   | 0      |   |   |   | 0 |   |
| Past service credits accumulated in the other comprehensive income (loss) at the end of year       |   | $      | 3,598  |   |   | $      | 4,940  |   |   | $ | 6,200 |   |
|                                                                                               |   |   |   |   |   |   |   |   |   |   |   |   |
| Net amount recognized in accumulated other comprehensive income (loss) at the end of year          |   | $      | 10,287 |   |   | $      | 9,720  |   |   | $ | 10,709 |   |

|                          |   | Pension Benefits |   |   | Other Benefits |   |
|-------------------------------|--------|-----------------------|--------|--------|---------------------|--------|
|                          |   | 2010                  |   |   | 2009                |   |   | 2010 |   |   | 2009 |   |
| Discount rate                 |   |                  | 5.2    | %      |                |   | 5.6 | % |   |   | 5.2 | % |   |   | 5.5 | % |
| Rate of compensation increase |   |                  | 3.4    | %      |                |   | 3.3 | % |   |   | - |   |   |   | - |   |

----

|                      |   | Pension Benefits |   |   | Other Benefits |   |
|--------------------------------|--------|-----------------------|--------|--------|---------------------|--------|
|                           |   | 2010                  |   |   | 2009                |   |   | 2008 |   |   | 2010 |   |   | 2009 |   |   | 2008 |   |
| Discount rate                  |   |                  | 5.6    | %      |                |   | 6.4 | % |   |   | 6.2 | % |   |   | 5.3 | % |   |   | 6.5 | % |   |   | 6.3 | % |
| Expected return on plan assets |   |                  | 7.1    | %      |                |   | 7.6 | % |   |   | 7.3 | % |   |   | - |   |   |   | - |   |   |   | - |   |
| Rate of compensation increase  |   |                  | 3.3    | %      |                |   | 3.4 | % |   |   | 3.4 | % |   |   | - |   |   |   | - |   |   |   | - |   |

|                                                                              |   | Other Benefits |   |
|-----------------------------------------------------------------------------------|--------|---------------------|--------|
|                                                                              |   | 2010                |   |   | 2009 |   |   | 2008 |   |
| Health care cost trend rate assumed for next year                                 |   |                | 9.0    | % |   |   | 6.9 | % |   |   | 8.0 | % |
| Rate to which the cost trend rate is assumed to decline (the ultimate trend rate) |   |                | 5.0    | % |   |   | 5.0 | % |   |   | 5.0 | % |
| Year that the rate reaches the ultimate trend rate                                |   |                | 2014   |   |   |   | 2012 |   |   |   | 2012 |   |

|                                         |   | 1-% increase |   |   | 1-% decrease |   |
|----------------------------------------------|--------|-------------------|--------|--------|-------------------|--------|
| Effect on total of service and interest cost |   | $                 | 354    |   |              | $      | -116 |   |
| Effect on postretirement benefit obligation  |   | $                 | -1,675 |   |              | $      | 1,557 |   |

|                |   |   |   |   | QuotedPrices inActive |   |   | SignificantOtherObservable |   |   | SignificantUnobservableInputs |   |
|---------------------|--------|--------|--------|--------|----------------------------|--------|--------|----------------------------|--------|--------|-------------------------------|--------|
|                |   | Total  |   |   | (Level 1)                  |   |   | (Level 2)                  |   |   | (Level 3)                     |   |
| Investment funds    |   | $      | 50,112 |   |                       | $      | 17,950 |                       |   | $      | 32,031                        |   |   | $ | 131 |   |
| Insurance contracts |   |   | 2,390  |   |                       |   | -      |                       |   |   | 2,390                         |   |   |   | - |   |
| Total assets        |   | $      | 52,502 |   |                       | $      | 17,950 |                       |   | $      | 34,421                        |   |   | $ | 131 |   |

----

|            |   | Pension Benefits |   |   | Other Benefits |   |
|-----------------|--------|------------------|--------|--------|----------------|--------|
| 2011            |   | $                | 4,168  |   |           | $      | 1,950 |   |
| 2012            |   |             | 4,361  |   |           |   | 1,912 |   |
| 2013            |   |             | 4,508  |   |           |   | 1,851 |   |
| 2014            |   |             | 4,351  |   |           |   | 1,806 |   |
| 2015            |   |             | 4,286  |   |           |   | 1,771 |   |
| Years 2016-2020 |   | $                | 24,014 |   |           | $      | 8,411 |   |

| 14. | Debt |
|-----|------|

|                                |   | Effective Interest Rate% |   |   | Principal inCurrency ofDebt |   | Maturity |    | Carrying Amount |   |
|------------------------------------------|--------|------------------------------------|--------|--------|---------------------------------------|--------|----------|---------|----------------------|--------|
|                                     |   | 2010                               |   |   | 2009                                  |   |     | 2008    |                 |   |   |   |   |   | 2010 |   |   | 2009 |   |
| Senior facility agreement, comprised of: |   |                               |   |   |                                  |   |     |    |                 |   |   |   |   |   | $ | 750,888 |   |   | $ | 959,216 |   |
| Tranche A                                |   |                               |   |   |                                  |   |     |    |                 |   |   |   |   |   |   |   |   |   |   |   |   |
| Euro-denominated                         |   |                               |   |   |                                  | 2.30   |     |    |                 | 4.14   |   |   |   | 40,000 |   | Sept. 30, 2012 |   |   | 0 |   |   |   | 4,937 |   |
| GBP-denominated                          |   |                               |   |   |                                  | 2.20   |     |    |                 | 3.67   |   |   |   | 83,502 |   | Sept. 30, 2012 |   |   | 0 |   |   |   | 25,718 |   |
| Tranche B                                |   |                               |   |   |                                  |   |     |    |                 |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Euro-denominated                         |   |                               | 3.03   |   |                                  |   | 2.80     |    |                 |   | 4.87 |   |   |   | 227,190 |   | Sept. 30, 2013 |   |   | 260,254 |   |   |   | 327,182 |   |
| USD-denominated                          |   |                               | 2.30   |   |                                  |   | 2.29     |    |                 |   | 2.58 |   |   |   | 137,076 |   | Sept. 30, 2013 |   |   | 115,137 |   |   |   | 137,093 |   |
| Tranche C                                |   |                               |   |   |                                  |   |     |    |                 |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Euro-denominated                         |   |                               | 3.53   |   |                                  |   | 3.30     |    |                 |   | 5.37 |   |   |   | 227,190 |   | Sept. 30, 2014 |   |   | 260,330 |   |   |   | 327,189 |   |
| USD-denominated                          |   |                               | 2.80   |   |                                  |   | 2.79     |    |                 |   | 3.08 |   |   |   | 137,076 |   | Sept. 30, 2014 |   |   | 115,167 |   |   |   | 137,097 |   |
|                                     |   |                               |   |   |                                  |   |     |    |                 |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Other bank loans                         |   | various                            |   |   | various                               |   |     | various |                 |   |   |   |   |   |   |   | 89,181 |   |   |   | 44,630 |   |
|                                     |   |                               |   |   |                                  |   |     |    |                 |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Capital leases                           |   |                               |   |   |                                  |   |     |    |                 |   |   |   |   |   |   |   |   |   |   | 388 |   |   |   | 6,523 |   |
|                                     |   |                               |   |   |                                  |   |     |    |                 |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Total debt                               |   |                               |   |   |                                  |   |     |    |                 |   |   |   |   |   |   |   |   |   | $ | 840,457 |   |   | $ | 1,010,369 |   |
|                                     |   |                               |   |   |                                  |   |     |    |                 |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Thereof:                                 |   |                               |   |   |                                  |   |     |    |                 |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Noncurrent debt                          |   |                               |   |   |                                  |   |     |    |                 |   |   |   |   |   |   |   |   |   | $ | 822,447 |   |   | $ | 971,400 |   |
| Current debt                             |   |                               |   |   |                                  |   |     |    |                 |   |   |   |   |   |   |   |   |   | $ | 18,010 |   |   | $ | 38,969 |   |

| Debt Principal Payments |   |   |    |
|-------------------------|--------|--------|---------|
| 2011                    |   | $      | 17,739  |   |
| 2012                    |   |   | 72,633  |   |
| 2013                    |   |   | 374,848 |   |
| 2014                    |   |   | 374,848 |   |
| 2015                    |   |   | 0       |   |
|                    |   | $      | 840,068 |   |

----

| 15. | Equity and shareholder loans |
|-----|------------------------------|

----

----

| 16. | Share-based compensation |
|-----|--------------------------|

|                                     |   | 2010   |   |
|------------------------------------------|--------|--------|--------|
| Grant date fair value of unvested ADS    |   | $      | 8.77   |   |
| Assumptions used to determine fair value |   |   |   |   |
| Dividend yield                           |   |   | 0      | % |
| Risk-free rate of return                 |   |   | 0.94   | % |
| Expected life of awards (years)          |   |   | 4      |   |
| Expected volatility                      |   |   | 40     | % |

----

|                                                                                                  |   |               |   |   | Grant Date Fair Value |   |
|-------------------------------------------------------------------------------------------------------|--------|--------------------|--------|--------|--------------------------------------|--------|
| ADSs in thousands (represent one-fourth of an ordinary share) |   | Number ofADSs |   |   | WeightedAverage                      |   |   | Range of prices |   |
| Non-vested ADSs at December 31,2009                                                                   |   |               | 0      |   |                                 |   |   |   |   |   |
| ADSs granted in 2010                                                                                  |   |               | 674    |   |                                 | $      | 12 |   |   | $ | 9-14 |   |
| ADSs vested in 2010                                                                                   |   |               | 0      |   |                                 |   |   |   |   |   |   |   |
| ADSs forfeited in 2010                                                                                |   |               | -46    |   |                                 |   | 12 |   |   |   | 9-14 |   |
| Non-vested ADSs at December 31,2010                                                                   |   |               | 628    |   |                                 | $      | 12 |   |   | $ | 9-14 |   |

----

|                             |   | 2010   |    |   | 2009   |   |    | 2008   |   |
|----------------------------------|--------|--------|---------|--------|--------|--------|---------|--------|--------|
| LTIP compensation cost           |   | $      | 399     |   |   | $      | -       |   |   | $ | - |   |
| MEP compensation cost (credit)   |   |   | -13,613 |   |   |   | -33,250 |   |   |   | 90,700 |   |
| Total compensation cost (credit) |   | $      | -13,214 |   |   | $      | -33,250 |   |   | $ | 90,700 |   |

| 17. | Derivative financial instruments |
|-----|----------------------------------|

----

| 18. | Fair value measurements |
|-----|-------------------------|

|                                                                               |   | Fair Value asof December |   | Fair Value Measurements Using Fair ValueHierarchy |
|------------------------------------------------------------------------------------|--------|-----------------------------------------|--------|----------------------------------------------------------------------------|
|                                                                               |   | 31, 2010                           |   | Level 1                                                                    |   | Level 2 |   | Level 3 |
| Assets                                                                             |   |                                    |   |                                                                       |   |   |   |   |   |
| Foreign exchange currency forward contracts                                        |   | $                                       | 247    |                                                                       |   |   | $ | 247 |   |   |
| Embedded derivatives                                                               |   | $                                       | 334    |                                                                       |   |   | $ | 334 |   |   |
|                                                                               |   |                                    |   |                                                                       |   |   |   |   |   |   |
| Liabilities                                                                        |   |                                    |   |                                                                       |   |   |   |   |   |   |
| Foreign exchange currency forward contracts                                        |   | $                                       | 124    |                                                                       |   |   | $ | 124 |   |   |
| Foreign exchange currency forward contracts used in a cash flow hedge relationship |   | $                                       | 608    |                                                                       |   |   | $ | 608 |   |   |
| Interest rate swaps                                                                |   | $                                       | 12,466 |                                                                       |   |   | $ | 12,466 |   |   |
| Embedded derivatives                                                               |   | $                                       | 533    |                                                                       |   |   | $ | 533 |   |   |
|                                                                               |   |                                    |   |                                                                       |   |   |   |   |   |   |
|                                                                               |   | Fair Value asof December |   | Fair Value Measurements Using Fair ValueHierarchy |
|                                                                               |   | 31, 2009                           |   | Level 1                                                               |   | Level 2 |   | Level 3 |
| Assets                                                                             |   |                                    |   |                                                                       |   |   |   |   |   |   |
| Foreign exchange currency forward contracts                                        |   | $                                       | 196    |                                                                       |   |   | $ | 196 |   |   |
| Embedded derivatives                                                               |   | $                                       | 85     |                                                                       |   |   | $ | 85 |   |   |
| Liabilities                                                                        |   |                                    |   |                                                                       |   |   |   |   |   |   |
| Interest rate swaps                                                                |   | $                                       | 7,972  |                                                                       |   |   | $ | 7,972 |   |   |
| Embedded derivatives                                                               |   | $                                       | 635    |                                                                       |   |   | $ | 635 |   |   |

----

|                                                    |   | 2010           |    |   | 2009            |   |
|---------------------------------------------------------|--------|----------------|---------|--------|-----------------|--------|
|                                                    |   | CarryingAmount |    |   | Fair Value |   |   | CarryingAmount |   |   | Fair Value |   |
| Cash and cash equivalents                               |   | $              | 216,294 |   |            | $      | 216,294 |   |   | $ | 75,392 |   |   | $ | 75,392 |   |
| Financial assets recognized at cost                     |   |           |    |   |            |   |   |   |   |   |   |   |   |   |   |   |
| Accounts receivable (without customer contracts)        |   |           | 256,764 |   |            |   | 256,764 |   |   |   | 252,861 |   |   |   | 252,861 |   |
| Other assets                                            |   |           | 18,382  |   |            |   | 18,382 |   |   |   | 3,500 |   |   |   | 3,500 |   |
| Financial assets at fair value                          |   |           |    |   |            |   |   |   |   |   |   |   |   |   |   |   |
| Derivatives recognized at fair value through income     |   |           | 581     |   |            |   | 581 |   |   |   | 281 |   |   |   | 281 |   |
| Financial liabilities recognized at amortized cost |   |           |    |   |            |   |   |   |   |   |   |   |   |   |   |   |
| Accounts payable                                        |   |           | 204,343 |   |            |   | 204,343 |   |   |   | 195,635 |   |   |   | 195,635 |   |
| Debt                                                    |   |           | 840,068 |   |            |   | 840,068 |   |   |   | 1,003,846 |   |   |   | 1,003,846 |   |
| Other current and non current liabilities               |   |           | 40,066  |   |            |   | 40,066 |   |   |   | 49,245 |   |   |   | 49,245 |   |
| Financial liabilities at fair value                     |   |           |    |   |            |   |   |   |   |   |   |   |   |   |   |   |
| Derivatives recognized at fair value through income     |   |           | 13,123  |   |            |   | 13,123 |   |   |   | 8,607 |   |   |   | 8,607 |   |
| Derivatives designated as hedging instrument            |   |           | 608     |   |            |   | 608 |   |   |   | 0 |   |   |   | 0 |   |

| 19. | Commitments and contingencies |
|-----|-------------------------------|

|                                            |   | 2010   |   |   | 2009   |   |
|-------------------------------------------------|--------|--------|--------|--------|--------|--------|
| Buildings and leasehold                         |   |   | 79     |   |   |   | 11 |   |
| Other equipment, fixtures, furniture and office |   |   | 47     |   |   |   | 923 |   |
| Total capital commitments                       |   | $      | 126    |   |   | $      | 934 |   |

----

| 2011                 |   | $      | 5,600 |   |
|----------------------|--------|--------|-------|--------|
| 2012                 |   |   | 4,788 |   |
| 2013                 |   |   | 3,676 |   |
| 2014                 |   |   | 2,405 |   |
| 2015                 |   |   | 874   |   |
| More than five years |   | $      | 3,541 |   |

| 20. | Related party disclosures |
|-----|---------------------------|

----

| 21. | Segment reporting |
|-----|-------------------|

|   | · | Gas |
|--------|--------|-----|

|   | · | Electricity |
|--------|--------|-------------|

|   | · | Water |
|--------|--------|-------|

----

|                          |   | Gas    |      |   | Electricity |   |      | Water  |   |
|-------------------------------|--------|--------|-----------|--------|-------------|--------|-----------|--------|--------|
|                          |   |   |      |   |        |   |      |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|                          |   | 2010   |      |   | 2009        |   |      | 2008   |   |   | 2010 |   |   | 2009 |   |   | 2008 |   |   | 2010 |   |   | 2009 |   |   | 2008 |   |
| Total revenues                |   | $      | 943,752   |   |        | $      | 899,792   |   |   | $ | 1,129,383 |   |   | $ | 451,499 |   |   | $ | 453,089 |   |   | $ | 404,129 |   |   | $ | 383,928 |   |   | $ | 355,870 |   |   | $ | 384,032 |   |
| thereof to external customers |   |   | 941,426   |   |        |   | 898,071   |   |   |   | 1,127,359 |   |   |   | 437,713 |   |   |   | 445,050 |   |   |   | 395,419 |   |   |   | 380,200 |   |   |   | 352,001 |   |   |   | 381,723 |   |
| thereof to other segments     |   |   | 2,326     |   |        |   | 1,721     |   |   |   | 2,024 |   |   |   | 13,786 |   |   |   | 8,039 |   |   |   | 8,710 |   |   |   | 3,728 |   |   |   | 3,869 |   |   |   | 2,309 |   |
|                          |   |   |      |   |        |   |      |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Segment profit                |   | $      | 230,228   |   |        | $      | 203,958   |   |   | $ | 264,111 |   |   | $ | 55,935 |   |   | $ | 60,424 |   |   | $ | 34,952 |   |   | $ | 35,439 |   |   | $ | 30,418 |   |   | $ | 32,276 |   |
|                          |   |   |      |   |        |   |      |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Depreciation and amortization |   |   | -45,638   |   |        |   | -48,908   |   |   |   | -50,837 |   |   |   | -25,141 |   |   |   | -23,286 |   |   |   | -19,817 |   |   |   | -11,803 |   |   |   | -11,673 |   |   |   | -13,004 |   |
|                          |   |   |      |   |        |   |      |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Segment working capital       |   | $      | 121,384   |   |        | $      | 110,928   |   |   | $ | 135,926 |   |   | $ | 49,170 |   |   | $ | 76,415 |   |   | $ | 61,150 |   |   | $ | 61,397 |   |   | $ | 48,016 |   |   | $ | 65,808 |   |
|                          |   |   |      |   |        |   |      |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Capital expenditure           |   | $      | 17,959    |   |        | $      | 14,991    |   |   | $ | 31,686 |   |   | $ | 10,211 |   |   | $ | 9,125 |   |   | $ | 35,845 |   |   | $ | 8,927 |   |   | $ | 7,523 |   |   | $ | 13,853 |   |
|                          |   |   |      |   |        |   |      |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Total assets                  |   | $      | 2,365,594 |   |        | $      | 2,320,246 |   |   | $ | 2,221,747 |   |   | $ | 502,092 |   |   | $ | 542,980 |   |   | $ | 464,440 |   |   | $ | 453,235 |   |   | $ | 408,978 |   |   | $ | 412,121 |   |

|                                                       |   | Total Segments |      |   | Corporate and Elimination |   |      | Consolidated Totals |   |
|-----------------------------------------------------------------|--------|----------------|-----------|--------|---------------------------|--------|-----------|---------------------|--------|
|                                                            |   | 2010           |      |   | 2009                      |   |      | 2008                |   |   | 2010 |   |   | 2009 |   |   | 2008 |   |   | 2010 |   |   | 2009 |   |   | 2008 |   |
| Total revenues                                                  |   | $              | 1,779,179 |   |                      | $      | 1,708,751 |                |   | $ | 1,917,544 |   |   | $ | -19,840 |   |   | $ | -13,629 |   |   | $ | -13,043 |   |   | $ | 1,759,339 |   |   | $ | 1,695,122 |   |   | $ | 1,904,501 |   |
| thereof to external customers                                   |   |           | 1,759,339 |   |                      |   | 1,695,122 |                |   |   | 1,904,501 |   |   |   | 0 |   |   |   | 0 |   |   |   | 0 |   |   |   | 1,759,339 |   |   |   | 1,695,122 |   |   |   | 1,904,501 |   |
| thereof to other segments                                       |   |           | 19,840    |   |                      |   | 13,629    |                |   |   | 13,043 |   |   |   | -19,840 |   |   |   | -13,629 |   |   |   | -13,043 |   |   |   | 0 |   |   |   | 0 |   |   |   | 0 |   |
|                                                            |   |           |      |   |                      |   |      |                |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Segment profit                                                  |   | $              | 321,602   |   |                      | $      | 294,800   |                |   | $ | 331,339 |   |   | $ | -36,594 |   |   | $ | -30,750 |   |   | $ | -16,709 |   |   | $ | 285,008 |   |   | $ | 264,050 |   |   | $ | 314,630 |   |
|                                                            |   |           |      |   |                      |   |      |                |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Foreign currency exchange effects                               |   |           |      |   |                      |   |      |                |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   | 2,933 |   |   |   | 14,412 |   |   |   | -45,153 |   |
| Management equity program                                       |   |           |      |   |                      |   |      |                |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   | 13,613 |   |   |   | 33,250 |   |   |   | -90,700 |   |
| Expenses for preparation to become a public company             |   |           |      |   |                      |   |      |                |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   | -12,663 |   |   |   | -22,949 |   |   |   | -6,969 |   |
| Strategy development costs                                      |   |           |      |   |                      |   |      |                |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   | -326 |   |   |   | -3,644 |   |   |   | -7,835 |   |
| Employee termination and exit costs                             |   |           |      |   |                      |   |      |                |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   | -6,217 |   |   |   | -25,363 |   |   |   | -10,457 |   |
| Business process reengineering and reorganisation costs         |   |           |      |   |                      |   |      |                |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   | -5,937 |   |   |   | -16,818 |   |   |   | -3,169 |   |
| IT project costs                                                |   |           |      |   |                      |   |      |                |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   | -1,884 |   |   |   | -8,602 |   |   |   | -3,652 |   |
| Gain (loss) from sale of real estate                            |   |           |      |   |                      |   |      |                |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   | 0 |   |   |   | 2,506 |   |   |   | 829 |   |
| Business combination cost                                       |   |           |      |   |                      |   |      |                |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   | 0 |   |   |   | -1,733 |   |   |   | 0 |   |
| Impairment of intangible assets                                 |   |           |      |   |                      |   |      |                |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   | 0 |   |   |   | -2,241 |   |   |   | -1,317 |   |
| Effects of termination of distributor                           |   |           |      |   |                      |   |      |                |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   | -9,773 |   |   |   | 0 |   |   |   | 0 |   |
| Other                                                           |   |           |      |   |                      |   |      |                |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   | -270 |   |   |   | -316 |   |   |   | 204 |   |
| Depreciation and amortization                                   |   |           | -82,582   |   |                      |   | -83,867   |                |   |   | -83,658 |   |   |   | -2,949 |   |   |   | -1,568 |   |   |   | -1,684 |   |   |   | -85,531 |   |   |   | -85,435 |   |   |   | -85,342 |   |
| Interest income                                                 |   |           |      |   |                      |   |      |                |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   | 1,906 |   |   |   | 2,569 |   |   |   | 2,784 |   |
| Interest expense                                                |   |           |      |   |                      |   |      |                |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   | -61,989 |   |   |   | -57,993 |   |   |   | -120,047 |   |
| Income tax expense                                              |   |           |      |   |                      |   |      |                |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   | -29,402 |   |   |   | -39,349 |   |   |   | -30,898 |   |
| Income (loss) from continuing operations                        |   |           |      |   |                      |   |      |                |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   | $ | 89,468 |   |   | $ | 52,344 |   |   | $ | -87,092 |   |
|                                                            |   |           |      |   |                      |   |      |                |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Segment working capital                                         |   | $              | 231,951   |   |                      | $      | 235,359   |                |   | $ | 262,884 |   |   | $ | -12,149 |   |   | $ | -5,967 |   |   | $ | -3,942 |   |   | $ | 219,802 |   |   | $ | 229,392 |   |   | $ | 258,942 |   |
|                                                            |   |           |      |   |                      |   |      |                |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Accounts receivable/payable with associates                     |   |           |      |   |                      |   |      |                |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   | -3,925 |   |   |   | -42,949 |   |   |   | -4,792 |   |
| Inventory held related to deferred revenue                      |   |           |      |   |                      |   |      |                |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   | 0 |   |   |   | 0 |   |   |   | 3,389 |   |
| Advanced payments received less paid                            |   |           |      |   |                      |   |      |                |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   | 12,546 |   |   |   | 31,365 |   |   |   | 17,461 |   |
| Current assets (other than accounts receivable and inventories) |   |           |      |   |                      |   |      |                |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   | 334,999 |   |   |   | 202,964 |   |   |   | 192,150 |   |
| Accounts payable                                                |   |           |      |   |                      |   |      |                |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   | 204,343 |   |   |   | 195,635 |   |   |   | 199,307 |   |
| Noncurrent assets                                               |   |           |      |   |                      |   |      |                |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   | 1,396,492 |   |   |   | 1,525,035 |   |   |   | 1,515,024 |   |
| Total assets                                                    |   | $              | 3,320,921 |   |                      | $      | 3,272,204 |                |   | $ | 3,098,308 |   |   | $ | -1,156,664 |   |   | $ | -1,130,762 |   |   | $ | -916,827 |   |   | $ | 2,164,257 |   |   | $ | 2,141,442 |   |   | $ | 2,181,481 |   |
|                                                            |   |           |      |   |                      |   |      |                |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Capital expenditure                                             |   | $              | 37,097    |   |                      | $      | 31,639    |                |   | $ | 81,384 |   |   | $ | 5,294 |   |   | $ | -1,147 |   |   | $ | 428 |   |   | $ | 42,391 |   |   | $ | 30,492 |   |   | $ | 81,812 |   |

----

|             |   | North America incl. Mexico |    |   | Europe |   |    | All Other Countries |   |   | Consolidated Totals |   |
|-----------------------|--------|----------------------------|---------|--------|--------|--------|---------|---------------------|--------|--------|---------------------|--------|
|                  |   | 2010                       |    |   | 2009   |   |    | 2008                |   |   | 2010                |   |   | 2009 |   |   | 2008 |   |   | 2010 |   |   | 2009 |   |   | 2008 |   |   | 2010 |   |   | 2009 |   |   | 2008 |   |
|                  |   |                       |    |   |   |   |    |                |   |   |                |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Total revenues        |   | $                          | 569,911 |   |   | $      | 559,218 |                |   | $      | 532,903             |   |   | $ | 789,445 |   |   | $ | 766,540 |   |   | $ | 950,257 |   |   | $ | 399,983 |   |   | $ | 369,364 |   |   | $ | 421,341 |   |   | $ | 1,759,339 |   |   | $ | 1,695,122 |   |   | $ | 1,904,501 |   |
| thereof United States |   |                       | 467,121 |   |   |   | 448,043 |                |   |   | 440,851             |   |   |   | 0 |   |   |   | 0 |   |   |   | 0 |   |   |   | 0 |   |   |   | 0 |   |   |   | 0 |   |   |   | 467,121 |   |   |   | 448,043 |   |   |   | 440,851 |   |
| thereof Germany       |   |                       | 0       |   |   |   | 0       |                |   |   | 0                   |   |   |   | 238,998 |   |   |   | 256,038 |   |   |   | 308,990 |   |   |   | 0 |   |   |   | 0 |   |   |   | 0 |   |   |   | 238,998 |   |   |   | 256,038 |   |   |   | 308,990 |   |
|                  |   |                       |    |   |   |   |    |                |   |   |                |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Long-lived assets     |   | $                          | 58,432  |   |   | $      | 63,562  |                |   | $      | 75,639              |   |   | $ | 128,005 |   |   | $ | 154,320 |   |   | $ | 164,997 |   |   | $ | 16,462 |   |   | $ | 16,361 |   |   | $ | 14,791 |   |   | $ | 202,899 |   |   | $ | 234,243 |   |   | $ | 255,427 |   |
| thereof United States |   |                       | 58,284  |   |   |   | 63,363  |                |   |   | 75,414              |   |   |   | 0 |   |   |   | 0 |   |   |   | 0 |   |   |   | 0 |   |   |   | 0 |   |   |   | 0 |   |   |   | 58,284 |   |   |   | 63,363 |   |   |   | 75,414 |   |
| thereof Germany       |   |                       | 0       |   |   |   | 0       |                |   |   | 0                   |   |   |   | 64,952 |   |   |   | 81,519 |   |   |   | 81,075 |   |   |   | 0 |   |   |   | 0 |   |   |   | 0 |   |   |   | 64,952 |   |   |   | 81,519 |   |   |   | 81,075 |   |

----