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Electronics Production | June 16, 2005

Perlos weaker than anticipated

In the second quarter, the production of mechanical modules for mobile phones at Finnish-based EMS-Provider Perlos' plants has been more unevenly distributed than planned. Production volumes at Finnish plants have fallen considerably short of the plan.
At the same time, Perlos has made significant outlays on the ramp-up of new products by increasing its resources and capacity.

The uneven capacity utilisation ratio and greater cost foundation caused by the increased resources have burdened profitability, and the second-quarter operating result excluding non-recurring items is expected to be slightly in the red.
The outlook for net sales in the April-June period remains unchanged. The second-quarter net sales of the Telecommunications and Electronics business sector are anticipated to be at the same level as in the corresponding period of 2004 or slightly higher. In the second quarter, the net sales of the Healthcare business sector are forecast to grow substantially compared to the second quarter of the previous year.

The net sales of the Telecommunications and Electronics business sector are expected to grow in the July-December period compared to the corresponding period of the previous year. Full-year net sales are anticipated to increase in line with the unit growth of the mobile phone market.

The net sales of the Healthcare business sector are expected to continue growing at a significantly faster rate than the healthcare market.

In the second half of the year, the capacity utilisation ratio is anticipated to be substantially higher than in the first half. It is expected that profitability will improve significantly compared to the first six-month period. However, the result for the July-December period is anticipated to be weaker than in the same period in 2004.

During the second year-half, Perlos will begin the production of numerous new products, and the profitability for the period depends on the company's success in ramping up the production.

Perlos will publish its Interim Report for the second quarter on July 27, 2005.

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