Observer AB (publ) Interim Report January - June 2006

Strong growth in services with value-added, international information. Restructuring proceeds according to plan.

Operating profit amounted to SEK -373 million (86) and profit before tax was SEK -406 million (59). Profit after tax amounted to SEK -436 million (37) while earnings per share amounted to SEK -5.87 (0.53). Exclusive of goodwill write-downs and restructuring expenses, operating profit rose by 33 percent to SEK 115 million (86). Operating margin, exclusive of goodwill write-downs and restructuring expenses, amounted to 12 percent (10). The Group’s operating revenue rose by 14 percent to SEK 974 million (856). Organic growth in local currency amounted to 4 percent (1). Cash flow from operating activities amounted to SEK 95 million (49). Cash flow after investments amounted to SEK 51 million (5). The restructuring program in the Nordic & Baltic region and the UK as well as the Group Head Office proceeds according to plan. Expenses for these activities amounted to SEK 18 million during the second quarter.