SOLNA, Sweden, Oct. 17, 2003 (PRIMEZONE) -- LGP Telecom Holding AB(Other OTC:LGPHF) (Stockholm:LGP):
SUMMARY JULY-SEPTEMBER
-- Net sales amounted to MSEK 596.3 (382.0). This represents an increase
of 17.5 percent compared to the second quarter of 2003.
-- The operating result before items affecting comparability amounted to
MSEK 20.6 (41.5).
-- The operating result amounted to MSEK 0.9 (41.5). This represents an
improvement of MSEK 78.9 compared to the second quarter 2003.
-- Net profit/loss amounted to MSEK -13.4 (26.0).
-- Cash flow after capital expenditures was positive for the seventh
consecutive quarter: MSEK 12.6 (30.6).
-- Earnings per share amounted to SEK -0.27 (0.86).
SUMMARY JANUARY-SEPTEMBER
-- Net sales amounted to MSEK 1 421.2 (965.9). -- The operating result was MSEK -152.3 (-1.3). -- Net profit/loss was MSEK -151.9 (-15.8). -- Cash flow after capital expenditures was positive: MSEK 105.4 (68.6). -- Earnings per share amounted to SEK -3.43 (-0.52).
MARKET
Telecom
The level of activity in the market for products in infrastructure for wireless telecom increased during the quarter from a low level. The market was very weak during the first six months of the year, but towards the end of the second quarter a certain recovery was noted. This recovery continued during the third quarter and demand for the Company's products increased.
The market is driven primarily by growth markets, such as India and Russia.
Some increase in activity in the 3G market in Europe was perceived during the quarter, but the attitude remains cautious on the part of operators. Availability of 3G handsets and more advanced mobile services is limited. 3G handsets are not expected to become a volume product until 2004. A possible positive growth factor is the pricing offers for voice traffic launched by a number of major operators. The broad market remains in a wait-and-see mode despite increased activities from certain customers.
Sales to 3G networks accounted for about 17 percent of total sales during the quarter. 3G sales accounted for 19 percent of total sales during the first three quarters of the year.
The market is distinguished by short lead times and continued pricing pressures.
The Company's earnings are affected with some delay by foreign exchange fluctuations with a weaker dollar and a stronger Swedish krona experienced during the quarter. Over a longer term the development of exchange rates and their effect on sales is difficult to predict, however. In a bid to reduce the exposure to exchange rate fluctuations, at the same time lowering manufacturing costs, the Company is gradually increasing production at its plant in China.
Europe
Expansion of the 3G network continues, as does expansion of GSM networks in Eastern Europe, especially Russia. The Company has noted increased levels of activity in 3G in countries such as Italy, Germany and the United Kingdom.
North and South America
The market in North America continued to be stable during the quarter. The market in the United States is driven primarily by applications for 2.5G GSM and 3G CDMA. The level of activity In South America has increased, which has resulted in orders in Brazil.
Asia
Market demand in Asia increased during the period, but from a very low level. In China investments in GSM have resumed, while operators wait for word of decisions regarding 3G licenses.
ANALYST AND PRESS MEETING
At 9:00 a.m. CET, Friday, October 17 at Operaterassen, Stockholm.
SCHEDULE OF FUTURE REPORTING Year-end report 2003 January 29, 2004 Annual Report 2003 March 2004 Annual General Meeting 2004 March 18, 2004 Quarterly report January-March April 28, 2004 Quarterly report April-June July 15, 2004 Quarterly report July-September October 15, 2004
Stockholm, October 17, 2003 LGP Telecom Holding AB
Board of Directors
This interim report has not been examined by LGP's auditors.
The LGP Group consists of two business areas: Telecom and Contract manufacturing. Business area Telecom, which consists of LGP's telecom operations and Allgon, develops, manufactures and markets telecom products that improve radio coverage, capacity and data transmission speed in mobile communications networks all over the world. The product line includes antenna systems, coverage solutions, base stations systems and radio link systems. In business area Contract manufacturing, the LGP Group is, in its niche, a leading contract manufacturer of advanced industrial components. The Group has about 1,400 employees in 13 countries and annual sales of about 2.5 billion kronor. LGP is listed on the Attract40 list of the Stockholm Stock Exchange.
LGP Telecom Holding AB Organization number: 556346-2620 SE-187 70 Taby, Sweden Telephone: +46 8 540 822 00, fax +46 8 540 824 91 E-mail: info@lgpallgon.com Internet: www.lgpallgon.com
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