INTERIM REPORT JANUARY-SEPTEMBER 2007

STRONG INFLOW OF ORDERS IN THE THIRD QUARTER

• Inflow of orders: SEK 7,172 million (6,535)
• Net sales: SEK 6,576 million (6,004)
• Operating earnings excluding restructuring costs: SEK 424 million (328)
• Restructuring costs relate to closure of a production unit and amount to SEK 92 million, whereof SEK 9 million relates to the third quarter.
• Net earnings including restructuring costs: SEK 208 million (215)
• Earnings per share including restructuring costs: 6:92 SEK (7:15)

The first nine months of the year saw a continued good trend. Inflow of orders and net sales are continuing to rise for the tenth and ninth quarter in succession respectively.
The inflow of orders during the third quarter was strong with a particularly good trend in eastern Europe and Asia. The increase for the quarter was 11% adjusted for the effects of exchange rate movements. Organic growth for the first nine months of the year was 10%, and the backlog of orders has increased by 33% since the turn of the year.
Earnings within Door & Logistics Solutions were adversely affected by costs due to delivery disturbances and non-recurring costs in connection with the restructuring of the production structure. Increased costs in connection with the implementation of a new groupwide IT structure as well as the weak US dollar also had an adverse effect on earnings.
All divisions are showing improvements in earnings for the first nine months compared with the corresponding period the previous year.

RESULTS - COMPLETE REPORT
Please see the enclosed pdf document for the complete report where all tables and summaries can be found. The report is also available at www.cardo.com

INFLOW OF ORDERS, NET SALES AND EARNINGS
Third quarter 2007
During the third quarter, the inflow of orders amounted to SEK 2,337 million (2,109), up 11% after adjustment for the effects of exchange rate movements. The quarter shows good growth in Asia and Europe, where the trend in eastern Europe was particularly strong. The inflow of orders rose in all divisions except Residential Garage Doors, where the trend in Germany continued to be weak.
Net sales amounted to SEK 2,186 million (2,056), up 7% after adjustment for the effects of exchange rate movements. Operating earnings excluding restructuring costs improved to SEK 150 million (140). Earnings within Door & Logistics Solutions were adversely affected by costs due to delivery disturbances and non-recurring costs equivalent to SEK 9 million in connection with restructuring of the production structure. Increased costs of approximately SEK 10 million relating to improving the efficiency of the Group’s IT structure and involving global infrastructure and a new common network provider were charged to earnings. The weak US dollar had an impact, and the effect of exchange rate movements amounts to approximately SEK -8 million for the quarter.

Period January – September 2007
During the first nine months of the year, the inflow of orders amounted to SEK 7,172 million (6,535), up 11% after adjustment for the effects of exchange rate movements. Organic growth was 10%. The first nine months of the year saw positive growth in Europe with a particularly strong trend in eastern Europe. Other strong regions during the period were Latin America, the Middle East and Asia. The trend in the North American market was somewhat weaker.
Net sales amounted to SEK 6,576 million (6,004), up 11% after adjustment for the effects of exchange rate movements. Organic growth was 10%.
Operating earnings excluding restructuring costs improved to SEK 424 million (328). The accumulated effect of exchange rate movements, primarily as a consequence of the weak US dollar, for the first nine months of the year amounts to SEK -12 million.
Net earnings, including restructuring costs, amounted to SEK 208 million (215), which is equivalent to SEK 6.92 (7.15) per share.
Cash flow from operating activities was SEK 180 million (96) after tax, which is equivalent to SEK 6.00 (3.20) per share.

RESTRUCTURING PROGRAM
The restructuring program aimed at rationalizing the operation and for which SEK 201 million was charged to the fourth quarter 2005 is going according to plan. The expected effects in terms of lower costs are estimated at SEK 55 million for the full year 2007.
With the aim of further strengthening the competitiveness of the Door & Logistics Solutions division and as part of an optimization of production structure, a decision was taken in the first quarter to close the unit for docking production in Wennigsen, Germany. During the year, a new production unit has been established in Romania. This was inaugurated according to plan during the third quarter. The costs of the closure in Germany have been charged to the first quarter 2007 in the sum of SEK 83 million whereof approximately SEK 55 million relates to write-downs of fixed assets. During the third quarter, further costs of SEK 9 million have been incurred for the changeover and the cost of restructuring up to and including the third quarter amounts to SEK 92 million.
The closedown in Germany in combination with the investment in Romania is expected to give a positive annual effect of approximately SEK 45 million on the earnings of Door & Logistics Solutions as of 2008. The effect on earnings for 2007, excluding the restructuring costs of SEK 92 million, is expected to be marginal.

OUTLOOK
The outlook from the interim report for January-June 2007 still applies:
We assess that the market trend for Cardo’s products and services will be generally relatively favorable during 2007 thereby providing conditions for continued organic growth for the Group as a whole. We expect the prices of raw materials to remain high and that there will be continuing difficulties in passing on price rises to the customers for the Door & Logistics Solutions and Residential Garage Doors divisions.



INVITATION TO CONFERENCE CALL ON FRIDAY, NOVEMBER 9, AT 10.00 A.M.
Cardo’s President and CEO Peter Aru will comment on the interim report at a conference call on Friday, November 9 at 10.00 a.m. It will be possible to take part and ask questions via the telephone number +46 (0)8 5352 6458. Please note that the area code must always be included. The conference may also be followed via a webcast through a link on Cardo’s website at www.cardo.com or via www.financialhearings.com. Here you will also be able to listen and see the presentation slides afterwards. The conference call will be held in Swedish.


Calendar 2008
Report on Operation 2007 February 6
Annual General Meeting April 7 in Malmö, Sweden