Interim report January - June 2000

January - June 2000 Negotiations with an international battery company as future partner have entered final phase. Net sales increased by 9 percent to MSEK 166 (152). Operating profit increased to MSEK 8.3 (7.2). Profit after financial items and tax MSEK 3.5 (3.4). Sales in Europe have been negatively affected by the continued strong US $. Sales for the first half-year increased by 16 percent in North America compared with same period last year. GYLLING OPTIMA BATTERIES AB ( publ ) REPORT JANUARY-JUNE 2000 Market and Sales Sales during the second quarter have increased by 10 percent in comparison with last year, which after a weak first quarter show a total increase of 4 percent for the half-year. In spite of a continued weak sales period for the battery industry in the USA during the second quarter, Optima has nevertheless succeeded in increasing its volume with 24 percent compared to the same period last year. The increase has been within all of Optima's main market segments. The distribution and development agreement with GNB, that came into effect during the first quarter in order to generate substantial volume growth, has been negatively affected by GNB being acquired earlier this year by Exide, one of the world's largest battery manufacturers. Sales in Europe, which continue to be squeezed by the strong dollar, have been able to recover during the latter part of the period. Volume is however still 22 percent below the same period last year. Development within the region is uneven, but where France for example has shown good volume growth. The reorganization of the European distributors continues in order to create more effective distribution channels. Asia has also shown a positive trend and has increased its sales volume by 13 percent during the period. During the first half of 2000, a total of 258,000 batteries were sold, compared with 248,000 during the same period in 1999. Production Rationalization and continued capacity expansion, as well as the launching of new battery models have affected the profit with substantial non-recurring costs. Research and Development The development of Optima's 36 volt batteries continues as planned. Prototypes have been delivered for testing on a larger scale to European car manufacturers. Optima's new Spiralpack for industrial trucks has now obtained its second large order. Earnings The Optima Group's profit after financial items and tax amounted to MSEK 3.5 (3.4). Financial Position Cash in the group amounted to MSEK 2.6 (3.4) as at June 30. Unused bank overdraft facility amounted to MSEK 17.3 (17.2). The group's investments during the period amounted to MSEK 14.5 (6.2). The equity ratio was 32.6 (32.1) percent, while the debt ratio was 1.61 (1.65) multiple. Net Sales Net sales increased by 9 percent to MSEK 166 (152). Assessment of the Future In spite of troublesome surrounding factors, Optima has been able to maintain its profit level and expand its market share in North America and Asia. Optima's Spiral Cell technology is now established as high-performance technology for lead/acid batteries within the existing battery segment and the future 36 volt segment. The battery industry has now entered a restructuring phase and new collaboration agreements and alliances are being discussed with the battery market's actors all over the world. An international battery company has shown considerable interest in acquiring a minority shareholding of Gylling Optima Batteries AB. Final negotiations are in progress, which is why trading in the stock has been suspended. The Board holds a positive view regarding the potential of the deal. Further information will be made available on Tuesday, August 29. Scheduled Reports Interim report Jan-Sept, November 22, 2000 Earnings report 2000, February 22, 2001 Danderyd, August 24, 2000 Bengt Hagander Chief Executive Officer and Group President For more information concerning this report, please refer to CEO Bengt Hagander, Vice President Pär M. Ericson or corporate counsel Lars Burström. This interim report has not been reviewed by the company's auditors. [REMOVED GRAPHICS] CONSOLIDATED INCOME STATEMENT 1-1-2000 1-1-1999 1-1-1999 SEK thousands 6-30-2000 6-30-1999 12-31-1999 Net sales 166 025 151 991 324 462 Cost of goods sold - 115 160 - 101 119 -226 678 Gross profit 50 865 50 872 97 784 Selling and marketing expenses - 17 880 - 22 810 -41 946 Administrative expenses - 19 542 - 18 296 -33 663 Research and development expenses - 5 125 - 2 598 -5 484 Operating profit/loss 8 318 7 168 16 691 Net financial items - 4 539 - 3 770 -9 648 Profit after financial net 3 779 3 398 7 043 Tax - 276 - 710 Profit/loss for the period 3 503 3 398 7 753 CONSOLIDATED BALANCE SHEET SEK thousands 6-30-2000 6-30-1999 12-31-1999 Fixed assets 162 252 147 630 151 604 Other current assets 45 789 32 221 35 680 Inventories 46 002 59 495 43 950 Accounts receivable 60 168 48 081 60 454 Cash and cash equivalents 2 596 3 370 6 114 Total assets 316 807 290 797 297 802 Equity 103 259 93 451 98 170 Interest-bearing liabilities 166 560 154 350 151 574 Accounts payable 25 071 21 898 28 094 Other non interest-bearing liabilities 21 917 21 098 19 964 Total equity and liabilities 316 807 290 797 297 802 BUSINESS RATIOS 6-30-2000 6-30-1999 12-31-1999 Gross profit margin (%) 30,64% 33,47% 30,14% Operating margin (%) 5,01% 4,72% 5,14% Profit margin (%) 2,28% 2,24% 2,17% Return on equity (%) 3,48% 3,74% 8,31% Return on capital employed (%) 4,83% 5,51% 10,70% Equity ratio (%) 32,59% 32,14% 32,96% Debt ratio (multiple) 1,61 1,65 1,54 Percentage shareholders' funds (%) 32,59% 32,14% 32,96% Interest coverage ratio (multiple) 1,43 1,37 1,41 Number of batteries sold 258 000 248 000 508 000 PER SHARE DATA 6-30-2000 6-30-1999 12-31-1999 Number of shares 29 915 400 29 915 400 29 915 400 Earnings per share after tax 0,12 0,11 0,26 P/E ratio (multiple) 80 79 52 Equity SEK 3,45 3,12 3,28 CONSOLIDATED CASH FLOW STATEMENT SEK thousands 6-30-2000 6-30-1999 12-31-1999 Cash flow from operating activities before changes in working capital 8 819 7 117 11 325 Changes in working capital - 19 196 - 37 372 - 33 856 Cash flow from operating activities - 10 377 - 30 255 - 22 531 Investment activities - 14 543 - 6 247 - 18 967 Financing activities 21 402 27 070 34 810 Cash flow for the period - 3 518 - 9 432 - 6 688 Cash at beginning of year 6 114 12 802 12 802 Cash at end of period 2 596 3 370 6 114 ------------------------------------------------------------ This information was brought to you by BIT http://www.bit.se The following files are available for download: http://www.bit.se/bitonline/2000/07/01/20000831BIT01080/bit0001.doc http://www.bit.se/bitonline/2000/07/01/20000831BIT01080/bit0002.pdf