Decision on action program at Cardo Pump

The action program that was announced previously for the Cardo Pump business area has now been decided. The cost of the measures, which is expected to amount to approximately SEK 45 million, will be charged to earnings for the third quarter of this year. The measures are expected to improve earnings by approximately SEK 30 million and to take full effect as of 2003.

In connection with the Cardo group half-yearly report, cost-saving measures were announced for Cardo Pump, especially as regards operations in markets with falling demand.

"Pump has shown a declining operating margin for a period of time. By means of measures such as those we are now adopting, we will reverse this trend; and our aim is to achieve an operating margin of 10-11 percent for the business area within a two-year period," says Cardo's president and CEO Kjell Svensson.

The action program, which has now been decided, mainly comprises staff reductions and the closure of some regional offices. The cost of the measures is expected to amount to approximately SEK 45 million and will be charged to earnings for the third quarter of 2001. The measures are expected to improve earnings by approximately SEK 30 million and to take full effect as of 2003.

Cardo Pump, which has a turnover of approximately SEK 2.5 billion, is a business area in the Cardo group and one of Europe's leading manufacturers of pumps, mixers and aerators for water and wastewater applications, industry, and the building services sector. Cardo Pump is also a global leader in the production of sophisticated measurement instruments for the pulp and paper industry.

Malmö, Sweden, October 5 2001

Cardo AB (publ)