FLS Industries refutes press information about secret guarantees

Berlingske Tidendes Nyhedsmagasin, the Danish weekly, published an article on 24 February 2003 giving wrong information about secret guarantees provided by FLS Industries A/S. FLS Industries strongly rejects the allegations to this effect that were contained in the article.

In the 2001 Annual Report, Note 17 to the parent company accounts reads as follows concerning Contingent liabilities: "The company guarantees the supply and operating commitments of a few subsidiaries."

Accounting for order-related supply and operating commitments is described in Note 30 to the consolidated accounts, from which it appears that accounting provisions have been made for losses estimated to arise from the processing of orders.

The information given in the notes complies with the provisions of the Financial Statements Act in force at the time and the new 1 January 2002 Financial Statements Act as well as International Accounting Standards (IAS).

The auditors appointed by FLS Industries, KPMG C. Jespersen and Deloitte & Touche, agree with the above statement.

FLS Industries A/S
Jørgen Worning
Board Chairman

Poul Erik Tofte
Group CFO