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Test & Measurement | September 07, 2007

Rood starts test activities in<br>Dresden and grows by 24%

In the first half of 2007, Rood Technology's sales (€ 4.790 million) rose by 24% compared to the first half of 2006 (€ 3.865 million).
The operational result for the first half of 2007 was € 201,000 positive, compared to € 108,000 negative in the first half of 2006. Rood Testhouse International N.V. (Rood Technology) in the first half of 2007 realized a net profit before tax of € 10,000 compared to a net loss before tax of € 198,000 in the first half of 2006.

'Rood has completed a good half year, in which we realized a sales growth of no less than 24%, at 8% higher personnel costs,' said Philip Nijenhuis, CEO of Rood Technology.

The business units Qualification and Failure & Technology Analysis realized significant growth, at 159% and 93% respectively, compared to the first half of 2006. Both business units contributed to the operating result in the first half. This trend is expected to continue in the coming period.
The business unit Test Engineering, whose growth lagged behind (-11%), did not contribute to the operating result. The order book in this sector has increased strongly in the past period, so that the forecast for the full year is positive, both in terms of sales and of the operating result.
The business unit Test & Related Services showed a limited (+6%) positive operating result, due to limited growth. Reorganizations among its major customers played a part in this. Partly as a result of this development, the business unit will show limited growth, as disclosed before.

The test activities in Dresden were started in June. The opening celebration for this branch took place on September 4. The operating costs during the first half put pressure on Rood Technology's total result. A lower than anticipated rise in demand for products to be tested seriously delayed the start-up. In spite of this, Rood anticipates that Dresden will contribute positively to the operating result at the end of the year.

The activities in relation to the supply chain China-Europe are progressing steadily. Rood is working towards strategic partnerships with other parties, and expects to realize concrete results in the next half year. The potential in this sector is very high, and will gain in importance.

Rood will continue to strengthen its position in Fabless Design houses, and is working towards expanding partnership agreements.

Personnel costs rose 8% compared to the first half of 2006, partly due to a structural salary increase arising from central arrangements. In the context of the strategic arrangements with Philip Nijenhuis, CEO of Rood Technology, he has waived the options granted to him for the first half of 2007.

Due to the sizeable investment program in 2006, depreciations have risen by 44%. Virtually all investments were made in the growth sectors, and form the basis for future growth. Approximately 80% of the investments are aimed at growth.

In its annual report, Rood Technology pronounced a forecast of a sales growth of between 10% and 20% compared to 2006. Rood maintains this forecast, which is well above the typical growth rate in this market segment. Additionally, Rood anticipates, in line with its disclosures, to be able to improve its operating result once again in 2007.

Rood maintains its long-term strategy, which includes the objective of doubling its core activities within 5 years. In this context, Rood is conducting active talks with market parties to achieve collaboration and integration in order to strengthen the company's position and improve its result.

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