Observer AB (publ) Interim report January-June 2005

Gradual improvement in sales in Europe generated two percent growth in second quarter

• The Group’s operating revenue rose to SEK 856.0 million (811.4). Exchange rate effects from the translation to Swedish kronor affected revenue negatively by SEK 12 million compared with the corresponding period of the previous year. Organic growth in local currency was 1 percent (-1). In the second quarter, organic growth reached 2 percent. • Operating profit, EBIT, amounted to SEK 86.2 million (99.5). Exchange rate effects impacted profit negatively by SEK 3.4 million compared with the year-on-year period. The operating margin was 10.1 percent (12.3). • Earnings per share amounted to SEK 0.70 (0.84). Profit after financial items amounted to SEK 59.3 million (77.0) and net profit was SEK 49.1 million (58.7). • Operating cash flow amounted to SEK 76.4 million (115.5). Comment by Observer CEO Robert Lundberg: “We are achieving greater success with our integrated services, and the positive growth in the second quarter is gratifying. We are not pleased with the profit trend, of course, and will maintain cost controls. In order to attain significant margin improvements, however, we have to benefit from our intensive service development and thereby increase revenues. The UK and Germany returned to positive growth in the second quarter. In the Nordic region we are close to reaching positive growth. US operations continue to show a positive development and we are reaching our financial objectives in spite of temporarily higher costs in the second quarter. In the Nordic region the margin is hampered by weak top-line development, coupled with tough competition and a high development rate.” Financial report schedule: November 1, 2005 Interim report January-September 2005 For further information, please contact: Jan-Erik Jansson, Acting Chief Financial Officer, telephone: +46 70 511 91 53, +46 8 507 410 14, e- mail: Per Blixt, Senior VP Corporate Communications, telephone: +46 70 549 28 08, +46 8 507 410 12, e- mail: Robert Lundberg, President and CEO, telephone: +46 8 507 410 10, e-mail: Further comments on the report will be provided at a telephone conference with Observer AB’s management at 15 pm (CEsT) on August 5. To participate, please dial one of the following numbers: UK dial in number: +44 (0)207 162 0179 US dial in number: +1 334 323 6203 Swedish dial in number: +46 8 505 201 14 (Please note that even when calling from Stockholm you have to dial the area code “08”) State password: “Observer” Observer AB SE-114 88 Stockholm Corp. Identity No: SE556027951401 Telephone: +46 8 507 410 00

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