Interim report for Sectra AB (publ) for the six months ended October 31, 2005: Increased sales and continued strong order bookings

Sectra reports strong sales and order bookings for the second quarter. Net sales rose 21.3% to SEK 144.7 million (119.3). Profit after net financial items of SEK 13.4 million (29.6) corresponded to a profit margin of 9.3% (24.8). Order bookings for the quarter totaled SEK 139.8 million (145.8).

Sectra’s net sales for the first six months increased 23.6% to SEK 245.5 million (198.6). Profit after net financial items of SEK 18.3 million (32.6) corresponded to a profit margin of 7.5% (16.4). Order bookings for the six-month period totaled SEK 255.3 million (205.3), up 24.4% compared with the year-earlier period. “In our two largest markets, the US and Scandinavia, our order bookings remain strong,” says Jan-Olof Brüer, CEO and President of Sectra AB. “The increase in revenue is attributable to a rise in direct sales in the US and project deliveries in Sweden,” he adds. “Our efforts to secure a strong position in long-term key markets have affected earnings. As reported earlier, Sectra will invest heavily in new marketing, sales and support channels in the next 12 to 24 months,” says Jan-Olof Brüer. Sectra has initiated a drive aimed at expanding the distribution network for medical systems. The objective is to take full advantage of the company’s new potential, which is a result of changes in its cooperation with Philips Medical Systems. New cooperation agreements have been established with companies in the US, France, the Netherlands, Finland and Turkey. Sectra has also opened direct-sales offices in Spain and Portugal. The undertaking involves a considerable strengthening of the service organization for medical systems and Sectra has launched an international service offering for all users of Sectra’s PACS products. “The launch of our new cost-effective service and support for users of Sectra’s PACS products was well received. We have already signed a number of strategically important service contracts with US customers,” says Jan-Olof Brüer. In the second quarter, Sectra’s secure communications business area received an order from the Austrian authorities. Ahead of the country’s EU Presidency, Austria has chosen to protect voice and data communication against eavesdropping using Sectra’s Tiger XS product. “The Austrian order is a breakthrough for our latest generation of Tiger products. We have made substantial investments in the development and marketing of these products and we can now reap the benefits of our efforts,” says Jan-Olof Brüer.