HL Display Interim report January - September 2008

* Sales during the third quarter of 2008 amounted to MSEK 367
    (378), operating profit amounted to MSEK 36 (35) and profit
    before tax to MSEK 38 (33). Net profit was reported as MSEK 26
    (23) and profit per share after dilution was SEK 0.84 (0.73) for
    the same period.
  * Net sales for the period amounted to MSEK 1 154 (1 158).
    Operating profit was MSEK 110 (112) and profit before tax was
    MSEK 110 (107). Net profit amounted to MSEK 78 (74).
  * EBITA-margin for the third quarter was 10.3% and for the period
    9.6%.
  * Profit per share after dilution amounted to SEK 2.51 (2.38) for
    the first nine months of the year.
  * For the full year a slight decrease in net sales and EBITA are
    expected.


Statement by the Managing Director

It seems obvious that the global business climate the next year or
years will be tough. The last year's efforts to make the group more
cost effective in combination with a healthy financial position make
us however believe that HL Display can benefit from the situation on
the market from a competitive point of view. The aim is to come out
of the recession as an even stronger company with a stronger market
position.

In the 6 months report we informed that sales 2008 should be below
our target 5-10 percent. More precise we expected the sales to be
slightly above 2007.Since then the uncertainties in the market have
increased and this has had a negative effect on us. We now expect a
slight decrease for the full year 2008. However it should also be
noticed that 4th quarter 2007 was very good while the sales the 4th
quarter this year is expected to be more in line with the average
sale this year.

Several actions taken the last years have given us an improved gross
profit. However as we had planned for a sales increase of 5-10
percent our operating expenses was also increased accordingly. As a
result the EBITA is rather stable.


Gérard Dubuy


Interim report

Net sales and result for the third quarter of 2008
Net sales for the Group amounted to MSEK 367 (378) for the third
quarter, a decrease of 3 percent compared to the same
quarter 2007. Operating profit for the same period was MSEK 36 (35)
and profit before tax amounted to MSEK 38 (33). The financial net for
the third quarter amounted to MSEK 2 (-2) whereof net interest 0
(-2), and exchange rate effects MSEK 2 (0).

Net sales and result for the first nine months of 2008
The Group's net sales amounted to MSEK 1 154 (1 158) for the first
nine months, unchanged compared to the same period in 2007. The
change in the value of the krona vis-a-vis the export currencies has
in total not affected net sales in comparison with last year.

Operating profit for the first nine months was MSEK 110 (112) and
profit before tax amounted to MSEK 110 (107). The change in value of
the krona compared to last year has had a positive effect amounting
to MSEK 3 on operating profit. Financial net for the period amounted
to MSEK -1 (-5) whereof interest net MSEK -2 (-6) and exchange rate
effects MSEK 1 (1). HL Display's most important export currencies are
Euro, British pounds and Russian roubles.

Gross margin has improved, thanks to a favourable product mix and
price increases introduced as from the year end. Raw material prices
have remained high during the nine month period. However, the
efficiency improvements carried out at the factories have well
counteracted any negative effects on the result. Operating expenses
have increased with MSEK 29 or 8% in comparison with last year.
Around MSEK 17 related to newly acquired subsidiaries and the
building up of sales companies on growth markets. Around MSEK 4 are
costs related to the retailing trade fair EuroShop, which is held
every third year.

Sales growth by market
During 2008 the sales on the markets in which HL Display operates has
in total been weaker than initially expected.
The exception has been the Nordic countries, which developed better
than expected and showed a growth in sales of 12 percent. Sales in
Western Europe decreased by 6 percent, mainly explained by
disturbances in connection with organizational changes. Sales in
Eastern Europe increased by 4 percent. Sales in Asia increased by 21
percent during the first nine months of 2008.

Seasonal effects
HL Display is normally affected negatively by seasonal variations
during December and January. The reason is that customers, who
consist mainly of retailing companies, do not plan any changes during
the Christmas shopping period.

Investments
During the first nine months, net investments in non-current assets
amounted to MSEK 27 (61). Net investments for 2007 included the
acquisition of Display Team. Depreciation according to plan amounted
to MSEK 27 (30).

Cash flow and financial position
As at 30 September 2008, liquidity amounted to MSEK 177 (147), at the
start of the year to MSEK 177. Interest-bearing net receivables,
which at the beginning of the year amounted to MSEK 49, amounted to
MSEK 36 (21) on the balance sheet date. Dividend decided upon
amounting to MSEK 43 (27) has been paid.
Cash flow from operating activities fell to MSEK 56 (92), primarily
as a result of a negative change in working capital. Cash flow from
operating activities for the third quarter amounted to MSEK 16 (16).
Operational cash flow amounted to MSEK 65 (95), per share SEK 2.09
(3.07), during the third quarter to SEK 0.59 (0.98) per share.

The equity ratio on the balance sheet date amounted to 54 (51)
percent; at the beginning of the year to 53 percent.

Employees
The average number of employees during the period was 987 (964). The
number of employees on the balance sheet date was 989 (966) and at
the beginning of the year 972.
The increase in employees is concentrated to the factory in Suzhou in
China.

Information about risks and uncertainty factors
Variations in raw material prices and exchange rate differences
constitute uncertainty factors, but not significant risks. For a
closer description of the risks and uncertainty factors facing HL
Display, please see the risk and sensitivity analysis on page 32 of
the annual report for 2007.

Parent company
The parent company's result after financial items for the first nine
months of 2008 amounted to MSEK -64 (-44). No significant changes
have been noted in the income statement or balance sheet.

Annual general meeting
Annual general meeting 2009 will be held at Factory, Nacka Strand
April 2, 2009.

The Nomination Committee consists of the following: Anders Remius,
Chairman of HL Display AB, Johan Lannebo, Fund Manager at Lannebo
fonder and Hasse Bjurevad, former bank director, Nordea. The
Nomination Committee can be contacted on the following address:
HL Display AB, Box 1118, 131 26 Nacka Strand, Sweden or via e-mail
at: info@hl-display.com.

Prospects for the remainder of 2008
In the previous quarterly report, sales for 2008 were expected to be
in line with 2007 or slightly above. The turbulence on the financial
markets the last months has started to have some negative impact on
sales. We believe that the fourth quarter can be in line with the
result of quarter three, but lower than last years fourth quarter,
which was extremely strong.

The forecast is now that net sales and EBITA are expected to fall
slightly as compared to 2007.


The full report incl. tables can be downloaded from the enclosed
link.