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Electronics Production | April 27, 2006

Elcoteq sales rose 21%

Finland based EMS giant Elcoteq SE's net sales between January and March rose 21% compared to the same period last year and totaled 981.1 million euros (810.3 in January-March 2005).
Operating income was slightly below last year's first-quarter figure and amounted to 8.3 million euros (9.5). Cash flow after investing activities was clearly positive.

This interim report has been prepared using IFRS recognition and measurement principles, which the company has applied since the beginning of 2004.

Elcoteq's net sales between January and March grew 21% on last year's first quarter and amounted to 981.1 million euros (810.3). Most of this growth took place in the Terminal Products business area. Geographically, growth was strongest in Asia-Pacific, where net sales rose 43% on the previous year.

The decline in profitability was mainly attributable to the weak margin for terminal products, especially in the home communications segment. The result was also burdened by the still low manufacturing load at the new plants. The Group's net financial expenses were 5.1 million euros (2.8). The main reason behind the increase in financial expenses was the strengthening of the financial structure during 2005 by the issuance of subordinated notes. Income before taxes was 2.9 million euros (6.5) and net income for the period totaled 2.1 million euros (4.4). Earnings per share (EPS) were 0.07 euros (0.14).

The Group's gross capital expenditures on fixed assets in the first quarter amounted to 16.0 million euros (21.6), or 1.6 % of net sales. Investments were allocated evenly throughout the geographical areas. Depreciation was 18.9 million euros (17.0). Elcoteq has also increased its manufacturing capacity by approximately 1.9 million euros through operating leases for production equipment.

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