Sales and earnings overshadowed by depressed markets (0510)

Key data for first quarter of 2005

As expected, the 2005 business year got off to a difficult start for the Micronas Group. In keeping with the general market situation, consolidated net sales for the first three months of the current year amounted to CHF 193.1 million, 13.8 percent lower than in the previous quarter. The gross margin was around 32 percent; profit for the reporting period amounted to CHF 7.8 million.

New orders for the first quarter of 2005 presented a rosier picture. Order intake amounted to CHF 175.5 million, 16.1 percent higher than in the previous quarter. This resulted in a book-to-bill ratio of 0.91.

Operating profit before depreciation and amortization of goodwill (EBITDA) totaled CHF 36.4 million in the reporting period. This represents a fall of 37.1 percent compared with the fourth quarter of 2004. Operating profit (EBIT) was CHF 8.8 million, 63.9 percent lower than in the previous quarter. Earnings per share for the reporting period amounted to CHF 0.24.

The Micronas Group's manufacturing capacity was fully utilized in the first three months of 2005. At CHF 33 million, investment in research and development was maintained at a high level.

To further increase our closeness to customers in one of the most attractive growth markets, Micronas opened a development center in Shanghai in the reporting period. The center, which employs 20 highly qualified engineers, will focus on the development of integrated circuits and systems for the TV market in China.

In the present market environment, it is impossible to make reliable predictions about the further development of our business. We expect demand to remain restrained for the rest of the 2005 business year. In view of the current market situation, we expect sales and earnings for the second quarter of 2005 to be on a par with the first quarter. On the basis of the indicators known to us today, we are confident that the second half of 2005 will bring growth compared with the first half. From the present viewpoint and given the poor first-half performance, we do not rule out the possibility that the 2005 business year as a whole will see a fall in sales compared with the record year of 2004.

The Micronas Group is a leading independent supplier of innovative application-specific semiconductor solutions for consumer and automotive electronics. Its shares are listed on the SWX Swiss Exchange and on the Prime Standard segment (TecDAX) in Frankfurt.