GROWTH AND PROFIT IMPROVEMENT IN 1ST HALF YEAR 2005

Kongsberg Automotive continued the positive development also into the second quarter of 2005. The operating revenues in second quarter increased by NOK 124 mill (24%) compared to last year. Year to date the increase is NOK 244 mill (24%). A bit more than 80 % of the growth is due to the acquisition of Raufoss United AS, which was done in June 2004, and the acquisition of Milan Seat System early June 2005. But also the other operations within Kongsberg Automotive have had growth (4 %) in the period. This has been recorded against a weak market for passenger cars, both in Europe and in USA. The commercial vehicle market has shown a positive development so far this year. An additional effect is that reduced prices give lower sales on constant volumes. The Company has converted to the international accounting principles IFRS. As a consequence the operating result for second quarter 2004 has been improved by NOK 14,2 mill due to changes in pension schemes. In addition the depreciations for 2nd quarter 2004 have been reduced by NOK 69,7 mill as a function of the acquisition of Raufoss United. After adjusting for these one-off effects, the operating profit for 1st half year 2005 is NOK 156,6 mill - an increase of 29 %. Net Profit for 1st half 2005 is NOK 85,9 mill, an improvement of 33 % compared to the same period last year excluding the one-off effects. For more details we refer to the attached figures that are an integrated part of this release. Despite that the last acquisitions have been financed by debt only net interest cost is at the same level as previous year. This is due to significant payments of dept the last 12 months. Net interest bearing dept for the company (including dept served in former holding companies) has been reduced by NOK 54 mill after the debt financing of the Milan acquisition of 161 mill. The acquisition of Milan opens for growth and profit improvements Milan Seat System (now a part of Kongsberg Automotive Inc) produces head- and armrests for seats for the North American automotive industry. This product portfolio strengthens Kongsberg`s position as the leading supplier of seat comfort systems. The North American market for head restraints that offer a safety function will increase significantly in the years to come partly due to legislations that have passed. Milan shows a strong increase in profit compared to last year`s figures. (These figures represented the reference for setting the purchase price for Milan). In June Milan recorded an operating profit of NOK 4,5 mill compared to NOK 24 for the whole year 2004. The integration of Milan into the Kongsberg organization has been conducted effectively and synergies have been identified. These will be realized in the time to come. For further information, please contact: CEO: Olav Volldal, tlf +47 982 14 014 CFO: Erik Magelssen, tlf +47 928 88 728. Appendix: Income statement and balance sheet The Interim Report 2nd quarter 2005