LGP Telecom Holding AB Interim Report March 2001

LGP Telecom Holding AB Interim Report March 2001 · Net sales increased by 32 percent to MSEK 376.0 (284.7) · Operating profit increased by 7 percent to MSEK 42.1 (39.2) · Earnings per share SEK 0.96 (0.91) · Frame order for 3G TMA's, 200 MSEK REVENUES AND RESULT Q1 2001 The LGP Group continues to show good growth despite the overall slowdown in the telecom sector. The Group's net sales amounted to MSEK 376.0, which represents an increase of MSEK 91.3, equivalent to 32.1 percent. Operating profit for the period amounted to MSEK 42.1 (39.2), including amortization of goodwill, an increase of 7.4 percent. The operating margin was 11.2 (13.8) percent. Amortization of goodwill was charged to the result in an amount of MSEK 5.0 (5.0). The decrease in margin due to lower growth than expected has lead to an overall review of costs. In production, all temporary personnel have been suspended and for employees on trial employment, assignments have been terminated early. In addition, notice has been given to some 40 employees. These actions are expected to generate full effect beginning in the second quarter. Earnings per share were SEK 0.96 (0.91). The telecom sector accounts for the increase in growth. Telecom accounts for 80 percent of total revenues. Compared to the year before, sales of telecom-related products increased by 44 percent. The market for telecom products remains strong. The market is distinguished by increased caution, both on the part of systems suppliers and operators. North America, South America and Asia continued to be strong markets for LGP. China and Brazil in particular were characterized by strong demand. LGP has a positive view of the development in the North American market as several mobile telephone operators have announced so-called "GSM layover" with the intention of using the WCDMA standard in their transition to 3G. LGP's position in GSM systems is strong. This transition towards GSM is therefore favorable to LGP. In March, LGP received its first frame order from a leading European systems supplier; the total order value is equivalent to MSEK 200. The order is for TMA's for the next generation of mobile infrastructure. It goes without saying the LGP has reacted to the change in market conditions and the greater measure of caution that distinguishes the current market. Action has been taken to adopt the organization and adjust costs to the current situation. This is being done without jeopardizing necessary initiatives in research and development required for future technologies. Capital expenditures The Group's net capital expenditures for the period January - March 2001 were MSEK 58.8 (-) in buildings and MSEK 23.1 (7.5) in machinery and equipment. The investment in buildings refers primarily to the construction in progress for a new production unit for assembly and final adjustment in Tullinge. The building will be fully operational in May. The investment in machinery and equipment relates to the new production unit and to machinery to increase processing capacity. Personnel The number of employees as of March 31, 2001 was 927 (633), which represents an increase since year-end 2000 of 109 employees. Financing The equity ratio as of March 31, 2001 stood at 60.8 percent. The figure was 62.8 percent as of December 31, 2000. The Group's liquid funds amounted to MSEK 48.5 and unutilized committed credit facilities amounted to MSEK 183.3. Cash flow for the period was MSEK -6.3 (7.2). Liquid funds as of December 31, 2000 stood at MSEK 54.8 and unutilized committed credit facilities were MSEK 34.7. Shareholders' equity per share was SEK 34.5 (30.6). Misscellaneous The same accounting principles as in the most recent annual report have been applied in preparing this interim report. Forecast 2001 LGP's sales are expected to exceed MSEK 1,850 with maintained profitability. However, this assumes that LGP's 3G deliveries begin as expected. Stockholm, April 24, 2001 Board of Directors LGP Telecom Holding AB Kolonnvägen 22 P.O. Box 1178 171 23 SOLNA SWEDEN Phone: +46 (0)8 50 74 80 00 Fax: +46 (0)8 50 74 81 49 www.lgp.com E-mail: mailbox@lgp.se ------------------------------------------------------------ This information was brought to you by BIT http://www.bit.se The following files are available for download: http://www.bit.se/bitonline/2001/04/24/20010424BIT01300/bit0001.doc The full report http://www.bit.se/bitonline/2001/04/24/20010424BIT01300/bit0001.pdf The full report

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