Distribution of company announcements to the professional platforms, finance portals and syndication of important corporate news to a wide variety of news aggregators and financial news systems.
Elektrobit Oyj (HEL:EBG1V) STOCK EXCHANGE RELEASE Available for publication on October 1st 2008 at 9.42 am. (CEST+1)
EB, ELEKTROBIT CORPORATION, LOWERS THE NET SALES AND OPERATING PROFIT GUIDANCE, CONTINUES TO IMPROVE PROFITABILITY AND TO ADJUST THE COST STRUCTURE
EB expects the net sales for the second half of 2008 to be lower than in the first half of 2008 (EUR 88.3 million) and the operating result from business operations for the second half of 2008 without the non-recurring items to be better than the operating loss without the non-recurring items from the first half of 2008 (EUR -15.1 million). Earlier, EB estimated the net sales of the second half to be roughly at the level of and the operating result from business operations to be significantly better compared to the first half of the 2008.
The net sales of the second half 2008 is anticipated to develop slower than expected earlier in Wireless Business Segment especially in USA. The net sales of the second half of Automotive Business Segment is growing but slower that earlier expected.
EB launches additional actions in order to improve its profitability and to adjust its cost structure. The target is to achieve annual cost savings totaling approximately EUR 30 million in comparison to the cost level of the first half of 2008.
In addition to the actions announced earlier, EB has disclosed on October 1st, 2008, in a separate stock exchange release that it will change its business model in the mobile WiMAX by shifting from investing upfront in the R&D of radio base station module products to the development of demanding, customer-financed WiMAX solutions. Furthermore, EB will continue to adjust its other R&D investments, streamline the support functions, further increase the resource utilization and reduce subcontracting.
Due to financial and production related reasons, EB will start personnel negotiations with personnel working in support functions with the goal of reducing approximately 40 people.
"The objective of these actions is to ensure profitability of EB. The change of the business model in the mobile WiMAX standard reduces EB's R&D investments significantly, yet maintaining the possibility to develop and deploy demanding mobile WiMAX solutions for customers. In the Wireless Business Segment, we will focus on combining customers', third parties' and EB's technology into integrated customer-financed solutions," says Pertti Korhonen, CEO of EB.
October, 1st, 2008 Elektrobit Corporation Board of Directors
DISTRIBUTION: OMX Nordic Exchange Helsinki Main media offices
EB, Elektrobit Corporation EB develops advanced technology and transforms it into enriching end user experiences. EB specializes in demanding embedded software and hardware solutions for the automotive industry and wireless technologies. The company's net sales for the year 2007 totaled EUR 144.3 million. Elektrobit Corporation is listed on the OMX Nordic Exchange Helsinki. www.elektrobit.com
