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Electronics Production | September 10, 2007

Efore results down

Net sales for November - July totalled EUR 56.0 million (EUR 71.6 million). The fall compared with the corresponding period in the previous fiscal year was 21.8 %. Sales by customer group were as follows: telecommunications 64.2 % (72.0 %), industrial electronics 27.9 % (23.2 %) and health-care electronics 7.9 % (4.8%).
Geographically sales were as follows: EMEA EUR 39.0 million (EUR 44.0 million), the Americas EUR 4.7 million (EUR 18.6 million) and APAC EUR 12.3 million (EUR 9.0 million). The operating profit for November - July was EUR -4.5 million (EUR -3.0 million).

The profit for November to July was affected by sales being lower in the first two quarters as expected and by the restructuring implemented in Finland and in the USA as planned. The USA operations have been further revised and began showing a profit in the third quarter. As a result of the restructuring, the company's cost structure has been improved.

The profit before taxes for November - July was EUR -4.7 million (EUR -3.1 million) and the net profit was EUR -5.1 million (EUR -5.8 million).

Net sales for the third quarter totalled EUR 21.6 million (EUR 22.5 million). The fall compared with the corresponding period in the previous fiscal year was 4.1 %. Sales by customer group were as follows: telecommunications 67.5 % (74.5 %), industrial electronics 26.9 % (20.3 %) and health-care electronics 5.6 % (5.2%).

Geographically sales were as follows: EMEA EUR 14.0 million (EUR 14.2 million), the Americas EUR 1.8 million (EUR 4.6 million) and APAC EUR 5.8 million (EUR 3.7 million). The operating profit for the third quarter was EUR 1.1 million (EUR -3.4 million).

The profit before taxes for the third quarter was EUR 0.9 million (EUR -4.0 million) and the net profit was EUR 0.8 million (EUR -4.3 million).

Product development activity was focused mainly on new base station families that will be used in the future and other equipment for telecommunications networks. Attempts have been and will be made to strengthen the number of product development and technical support resources further in both Europe and Asia.

Efore's new plant in China was inaugurated on May 8, 2007 and at the same time production at Efore's old premises was discontinued. The plant is 10,600 m2 in area, 7,560 m2 of which are production premises. With the expansion of production in China, the proportion of Efore's production undertaken in countries with lower costs had already risen to 91.0 % (77.1 %) by the end of the review period.

The exceptional uncertainty prevalent in the telecommunications sector is calming down, which makes it easier to predict general demand. Nevertheless, the outlook is weak, and the market is characterized by rapid changes. Operational flexibility, rapid responses and cost control will continue to be important factors for the company's economic success in future operations. Group investment in fixed assets amounted to EUR 3.2 million (EUR 4.0 million), of which investment in machinery and equipment accounted for EUR 2.5 million and product development costs EUR 0.7 million.

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