Observer AB (publ) Year-end report January-December 2005

Transition process in the Nordic region to be intensified. Growing demand for analyzed and integrated information in all markets

• The Group’s operating revenue rose by 10 percent to SEK 1,776.3 million (1,613.6). Exchange rate effects from the translation to Swedish kronor affected revenue by SEK 34 million compared with the previous year. Organic growth in local currency was 2 percent (0). In the fourth quarter organic growth reached 2 percent. • Operating profit, EBIT, amounted to SEK 175.1 million (193.9). Exchange rate effects impacted profit by SEK 5 million year-to-year. One-time costs totaled approximately SEK 15 million in the fourth quarter. The operating margin was 9.9 percent (12.0). In the last quarter the margin was 9.0 percent (10.6). Adjusted for one-time costs in the fourth quarter, the operating margin amounted to 10.7 percent for the full-year 2005 and 12 percent for the quarter. • Earnings per share amounted to SEK 1.12 (1.64). Profit after financial items amounted to SEK 117.2 million (148.8) and net profit was SEK 79.5 million (115.1). • Operating cash flow improved during the fourth quarter to SEK 73.2 million (44.1). For the full-year 2005 cash flow amounted to SEK 162.5 million (209.8). • In November Observer acquired the US broadcast monitoring company Multivision. The acquisition is expected to lead to a significant profit improvement and higher operating margin in the Group’s US subsidiary. The purchase price was paid in cash. In order to remain financially prepared for further expansion, a new issue of four million shares was floated. • Against the background of intensified restructuring work in the Nordic countries and to remain prepared for growth opportunities, the Board of Directors proposes that no dividend be paid for 2005. • Niklas Flyborg is taking over as the new President and CEO of Observer on Friday, February 10, 2006.