Adjustment of old Cell Network's interim report for three months ended March 31, 2000

Adjustment of old Cell Network's interim report for three months ended March 31, 2000 The merger of Cell Network AB and Mandator AB that was approved at Special General Meetings of the two companies on May 30, 2000 has occasioned a new review of the accounts for the first quarter of 2000. The review was undertaken to ensure that the accounts of the new group harmonize with respect to the application of accounting principles. In the case of Cell Network, the review has meant that the accrual of revenue for three projects has been adjusted in such a away that accounting for revenue has been deferred. The adjustment involves the following changes in old Cell Network's interim report for the three months ended March 31, 2000: Sales are reduced by SEK 12.5 M, to SEK 106.2 M. Operating income before amortization of goodwill is reduced by SEK 12.5 M, resulting in a loss of SEK 4.2 M. Of the adjustments of sales and income, SEK 10 M and SEK 8.7 M, respectively, are attributable to Cell Network International. The effects on the old Cell Network income statement and on key data per share are shown in the following table. Income statement FirstCorrec Adjusted quarter tion 2000 first quarter 2000 SEK M Net sales 118.7 -12.5 106.2 Cost of operations -110.4 - -110.4 Income/loss before amortization of 8.3 -12.5 -4.2 goodwill Amortization of goodwill -9.3 - -9.3 Operating income -1.0 -12.5 -13.5 Net financial items 4.0 - 4.0 Income/loss after financial items 3.0 -12.5 -9.5 Taxes - - - Net income/loss 3.0 -12.5 -9.5 Key data per share Shareholders' equity per share, SEK 52.01 -0.55 51.45 Shareholders' equity per share after allotment to sellers of IDM and WEB, SEK 51.60 0.55 51.05 Shareholders' equity per share after allotment to sellers of IDM and WEB, and assuming full conversion, SEK 46.89 -0.50 46.39 Net income/loss per share, SEK 0.15 -0.62 -0.47 Net income/loss per share after allotment to sellers of IDM and WEB, SEK 0.15 -0.61 -0.46 Net income/loss per share after allotment to sellers of IDM and WEB, and assuming full conversion, SEK 0.13 -0.56 -0.42 The following table shows the effects on the pro forma accounting for the new group. Pro forma financial statements for Cell Network/Mandator, three months ended March 31, 2000 Condensed income statements Mand Cell Intra-Group Adjust- Total Correction, Adjusted ator Netw sales ments1 Cell pro ork SEK M forma Net sales 269. 118. -8.3 - 380.1 -12.5 367.6 7 7 Gross 35.2 8.3 - -1.4 42.1 -12.5 29.6 results (EBITA)2,3 Income/loss 24.9 3.0 - -6.8 21.1 -12.5 8.6 after financial items3 1)After adaptation to Mandator's accounting principles. 2) EBITA = Earnings before interest, taxes and amortization. 3)Reversal of SPP pension funds is included in EBITA in the amount of SEK 32,2 M, and in income/loss after financial items in the amount of SEK 30.6 M. Merger in accordance with the pooling method The merger will be reported in accordance with the pooling method. When applying this method, assets and liabilities are stated in the amounts shown in each company's balance sheets, without adjustment other than that pertaining to coordination of the accounting principles that are being applied. Thus, no goodwill arises and earnings of the new group will not be charged with amortization attributable to the merger. Costs of the merger are reported in the period in which they are incurred. Smaller transaction costs Following the formal merger of Cell Network and Mandator, a new cost estimate for the merger has been made. The transaction costs arising in connection with the merger of Cell Network and Mandator are estimated to amount to approximately SEK 105 M. This compares with the estimate of approximately SEK 150 M that was made when the prospectus was prepared. These costs will be charged against income in the second quarter of 2000. Costs of integration Integration costs amounting to between SEK 35 M and SEK 45 M are estimated to arise in connection with the merger program. Integration costs consist mainly of investments in common support systems, in structural capital, in common worksites and in employee-development activities. These costs will be expensed as incurred during the year. For additional information: Arvid Liepe, Investor Relations, Cell Network AB (publ) / +46 8 522 041 85 / +46 70 956 51 85 Ellinor Bollman, Corporate Communications, Cell Network (publ) / +46 8 522 041 14 / +46 70 347 37 14 Niklas Flyborg, President and CEO, Cell Network AB (publ) / +46 8 402 31 09 Cell Network AB is, after merging with Mandator, one of the world's leading consulting companies focused on the Internet and interactive media. The company delivers business-critical solutions taking full responsibility for strategy, technology, design and content. Clients include Ericsson, Volvo, General Electrics, Telia, Astra Zeneca, Telenor, and Statoil. Cell Network is listed on the Stockholm stock exchange's O-list and has about 1800 employees in 13 countries. Read more about Cell Network AB at www.cellnetwork.com ------------------------------------------------------------ Please visit http://www.bit.se for further information The following files are available for download: http://www.bit.se/bitonline/2000/06/13/20000613BIT00050/bit0001.doc http://www.bit.se/bitonline/2000/06/13/20000613BIT00050/bit0002.pdf