CTS revenue increase 8% Year-over-Year

First quarter 2007 revenue increased 8% over the first quarter of 2006 driven by the EMS segment where sales climbed 13%. Components and Sensors segment sales increased 3%, primarily from strong automotive new product demand, offset by weakness in electronic component demand. First quarter 2007 earnings of $4.0 million were less than net earnings of $5.0 million, in the first quarter of 2006. First quarter 2007 net earnings were adversely impacted by $0.8 million, of costs associated with the internal investigation and account reconciliations at CTS' California EMS locations. Components and sensors sales increased $1.9 million, or 3%, over the first quarter of 2006 primarily on higher automotive component demand, partially offset by declines in electronic component sales. Despite the favorable impact of higher sales, segment operating earnings decreased $5.6 million from first quarter 2006 earnings. Approximately $2.7 million of the earnings decrease resulted from several unusual items which occurred in the first quarter of 2006, including higher than normal royalty payments, a gain on sale of assets and a favorable settlement of an insurance claim. The remaining unfavorable year-over-year change resulted from less favorable product mix and higher operating expenses, including incremental legal and accounting fees. Components and sensors sales increased $3.8 million, or 6%, from the fourth quarter of 2006 reflecting strong automotive product demand. Despite the favorable impact of higher sales, segment operating earnings decreased $1.4 million from the fourth quarter primarily from lower royalty income and increased operating expenses including incremental legal and accounting fees. EMS sales increased $10.9 million, or 13%, from the first quarter of 2006 driven primarily by higher sales into the defense and aerospace, industrial and communications markets, partially offset by lower demand in the computer market. The segment operating earnings, which were at breakeven, improved $0.8 million from first quarter 2006 operating loss of $0.8 million primarily due to higher volumes and more favorable product mix, partially offset by incremental legal and accounting fees. Compared to the fourth quarter of 2006, EMS segment sales decreased $14.1 million, or 13%. Total segment operating earnings decreased $2.8 million primarily from lower volumes and incremental legal and accounting fees.