Leoni largely normalised production in North Africa

Despite the difficult political situation in Egypt, which paralysed a large portion of the economy in the country, Leoni has succeeded in continuing and in the meantime largely normalising production in Cairo after it came to initial strong adversely affected production flows. Central measures taken in the context of crisis management are the flexible adjustment of the shift system to the curfew as well as the reliable operation of a self organized bus fleet which brings employees to the plant and back to their homes. Since Wednesday, 2 February 2011, staff attendance has increased to 80 _ 90%. Most of the employees have been working longer than usual and thereby have been able to minimize or catch up arrears in production. The plant itself has been safe up to now. As further political developments are difficult to estimate, Leoni continues to be on maximum alert. When the situation in Egypt was still calm, the company took preemptive measures by increasing production in Egypt, by producing in excess of demand and by exporting finished products. Thus, at present enough material of most of the products is being shipped to the customers, so that their supply chain is maintained for the next two to three weeks. As long as activities at the freight port are stopped or restricted, Leoni will make use of air freight for urgent products in accordance with the customers. The situation in the four Tunisian facilities has been largely stabilised already for more than one week. Occasionally there are delays in transport and in the ferry services. Up to date there are no back orders. In Egypt there are about 4'000 employees and in Tunisia about 12'000. At all the facilities wiring harnesses and wiring systems are manufactured for European automotive customers or international suppliers. Leoni expects no significant financial burden due to the problems in North Africa.