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Mid-Year Report - June 2006

Division : Corporate

Metalor closed the first half of 2006 with another good result. Revenues amounted to CHF 145.3 Mio. or 18% higher than the previous year. All divisions were profitable. The Operating Profit (EBIT) was CHF 21.4 Mio. or nearly three times as high as in the first half of 2005. The high precious metals prices influenced sales and profitability positively but also created substantially higher financing demands. The equity ratio of the company is 65%. Some owned stock of precious metals were sold and realized a profit of CHF 7.1 Mio. The company achieved a total net profit of CHF 25.5 Mio. for the half year.

  • The Refining Division performed well in Switzerland. Our US operation has finalized its restructuring and is again profitable. The profitability exceeded the planned level for the first six months of 2006. We expect a slowdown for the second half of the year.
  • The Advanced Coatings Division realized 12% higher sales than in the previous year mainly due to the higher precious metals prices and the favorable market conditions in the electronics sector in Asia. The restructuring of the French operation in 2005 had a positive impact on the profitability of this year. The EBIT margin reached 19%.
  • The Watch & Jewelry Division increased its sales by 12% as a result of the ongoing strong sales in the luxury watch industry. The EBIT margin improved substantially. Market share gains and market improvements in Europe contributed to the positive results.
  • The Electrotechnics Division showed a continuous growth in sales and profitability. The increase in sales was 19% compared to the first six months of the last year. The set-up of a production facility in China is in progress. We expect it to be operational by the end of this year.

The precious metals prices showed a very high volatility in the first half of 2006 and we believe this will continue for the rest of the year. For the next six months we expect a lower result as was realized in the first part of the year.

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