Group Management Report

The economic indicators for 2007 point to a lasting positive development in the global economy. While a slight decrease is expected in the previously strong growth rates in the United States, economies in Australia and numerous countries in the Middle East and Asia will continue to grow dynamically. The economic situation in Europe will presumably develop in a satisfactory manner, whereas the new member states of the European Union will achieve above-average growth rates.

In those markets that are relevant for Bilfinger Berger we expect generally good economic conditions. Revenues in the main construction sector in Germany will rise in the current year. A continuing robust construction industry can also be assumed in most neighboring European countries. Australia is showing persistently strong demand for civil engineering work, while falling growth rates are anticipated in commercial construction. In North America, continued high levels of investment in infrastructure are expected. Petroleum exporting countries will continue to expend significant sums on improving transport infrastructure and amenity networks.

Demand for industrial services in Germany and Europe outside Germany will be driven by increasing investments in the process industry. Investments in new plant construction and rehabilitation in power plant services are strong growth drivers. In facility management, the volume of services outsourced in Germany will continue to grow.

As a Multi Service Group, we profit from these developments and intend to further strengthen our strategic advantages, primarily by expanding our services business. We intend to achieve further organic growth, but are also targeting additional acquisitions. We have the advantage of substantial financial resources at our disposal. Potential candidates for acquisition must fulfill our strict selection criteria.We also intend to continue investing in high-yield concession projects. We aim to achieve a sustained improvement in profitability in the construction business.

Under the economic conditions outlined here, we anticipate a successful development in the Bilfinger Berger Group in the next two years. This is based on the assumption that the situation in areas with political tension does not intensify, that the financial markets remain free of heavy turbulence and that, overall, no critical weakening of the world economy occurs. The outlook for business developments in our segments is described in detail in the respective chapters.