Recovery in sales, profit and orders in second quarter (PR0516)

Business development in the first half of 2005

In the second quarter of 2005, the Micronas Group generated consolidated net sales of CHF 196.0 million, slightly above the previous quarter. The order intake rose by 35.8 percent to CHF 238.4 million. The book-to-bill ratio was 1.22. The operating profit (EBIT) for the second quarter of 2005 reached CHF 14.6 million, a 65.9 percent improvement over the previous quarter; as a percentage of net sales the figure was 7.4 percent. Profit for the reporting period increased by 55.1 percent to CHF 12.1 million, or 6.2 percent of net sales. Earnings per share for the second quarter amounted to CHF 0.37, which represented an increase of 54.2 percent compared with the previous quarter.

The adverse market situation affected the Micronas Group's performance in the first half of 2005. Micronas succeeded in maintaining its strong market position. Consolidated net sales in the first half of 2005 amounted to CHF 389.1 million, 20.2 percent lower than in the same period a year ago. Profit for the period amounted to CHF 19.9 million, 72.4 percent lower than in the first six months of 2004.

The operating profit before depreciation and amortization of goodwill (EBITDA) reached CHF 78.1 million in the first half of 2005, a decrease of 53.8 percent in a half-year comparison. The operating profit (EBIT) for the semester also fell, reaching CHF 23.3 million or 78.1 percent down on the comparable figure in 2004.

The profit for the period amounted to CHF 19.9 million, 72.4 percent lower than in the first six months of 2004. Profit for the period in percent of net sales was 5.1 percent. Earnings per share for the first half of 2005 amounted to CHF 0.60.

In the Consumer division, demand for our products remained subdued during the reporting period, though there were signs of a recovery towards the end of the second quarter. We expect fresh impetus for a market upturn from the international consumer electronics show IFA Berlin.

In the area of digital HDTV - a technological core competence of Micronas - China will play an increasingly important role in the coming years. As a result, Micronas has established a new R&D center in Shanghai which was officially inaugurated in June.

The Automotive division developed well in the first half of 2005. This was apparent in the Controllers segment, where sales exceeded expectations and there was buoyant demand for high-end products. Demand for Hall sensors remained at a high level.

For the second half of fiscal 2005 we expect sales to grow slightly above 20 percent compared with the first half and net profit in percent of net sales to reach 8 percent.

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.