Observer AB Preliminary Year-end report 2002

Observer AB (publ) Preliminary Year-end report for 2002 Improved operating margin and continued strong cash flow. Investments in new technology and savings will ensure good profits in a continued slow economy. · The group's operating revenue amounted to SEK 1,699.0 million (1,358.7), an increase of 25 percent. Exchange rate effects have adversely affected the revenue by SEK 36.3 million. Organic growth in local currency was -3 percent. · Operating profit before goodwill amortization and items affecting comparability amounted to SEK 310.6 million (231.2), with exchange rates adversely affecting profit by SEK 8.4 million. The operating margin for the full year rose to 18.3 percent (17.0). Fourth- quarter operating profit amounted to SEK 76.3 million, with exchange rates adversely affecting profit by SEK 4.6 million. The operating margin amounted to 17.9 percent (17.5). · Profit per share after dilution, excluding goodwill amortization and items affecting comparability, amounted to SEK 2.89 (2.47). · Cash flow remains strong. Operating cash flow is the strongest ever, amounting to SEK 324.5 million (130.6) for the full year and SEK 89.6 million (42.4) for the fourth quarter. · A new investment in a system to digitalize print media through scanning has begun. Digitalization will improve processing efficiency and provide the opportunity to develop a number of new services at low cost. The nonrecurring cost of the conversion is estimated at SEK 10 million, which will be charged against profit in the first quarter of 2003. · As a result of continued economic weakness, actions are being taken that will reduce costs by SEK 45 million. The one-time cost for the action program is estimated at SEK 17 million and will be charged against profit in the first quarter of 2003. For further information, please contact: Anders Lundmark, Chief Financial Officer, telephone: +46 70 333 29 77, e- mail: anders.lundmark@observergroup.com Per Blixt, Senior VP Corporate Communications/Investor Relations, telephone: +46 70 549 28 08, e- mail: per.blixt@observergroup.com Robert Lundberg, President and CEO, telephone: +46 8 507 410 10, e-mail: robert.lundberg@observergroup.com ------------------------------------------------------------ This information was brought to you by Waymaker http://www.waymaker.net The following files are available for download: http://www.waymaker.net/bitonline/2003/01/31/20030131BIT00120/wkr0001.doc The full report http://www.waymaker.net/bitonline/2003/01/31/20030131BIT00120/wkr0002.pdf The full report