Kitron — Earnings Release 2015

Jul 16, 2015

Kitron: Q2 2015 - Profitability improvement continued

Kitron: Q2 2015 - Profitability improvement continued

(2015-07-16) Kitron ASA today reported the fifth consecutive quarter of improved

profits, due to a combination of growing revenue and better margins.

Kitron's revenue in the second quarter amounted to NOK 489 million, an increase

from 457 million in the second quarter last year.

Operating profit (EBIT) was NOK 22.1 million, compared to 6.9 million last year.

The improved results are a consequence of increased revenue and better margins,

helped by growing service sales.

Net profit amounted to NOK 13.3 million, an improvement from 3.9 million. This

corresponds to earnings per share of NOK 0.08, compared to NOK 0.02 last year.

Peter Nilsson, Kitron's CEO, comments:

"The second quarter confirms that Kitron is continually improving operations and

financial results. Important orders, particularly within the Defence and

Aerospace sector, give cause for optimism. Going forward, we will implement

plans to ensure that operational metrics and margins improve even further."

* Fifth consecutive quarter of improved profits

* Continued strong development in Defence

* Important new orders in Defence and Aerospace

* Cash flow significantly improved

Fifth consecutive quarter of improved profits

The improvements in Kitron's profitability continued in the second quarter.

Profitability expressed as EBIT as a percentage of revenue was 4.5 per cent for

the quarter, up from 1.5 per cent in the second quarter of 2014. The improved

results are a consequence of increased revenue and better margins, where there

has been strong contribution from the service sales, both from development and

engineering.

Continued strong development in Defence

Revenue in the market sector Defence/Aerospace increased by 56 per cent from the

second quarter last year. Energy/Telecom and Industry also grew, while Medical

equipment declined slightly. Offshore/Marine was down 45 per cent due to the

weak oil service market in Norway.

Important new orders in Defence and Aerospace

During the quarter Kitron has received several significant orders, particularly

within the Defence/Aerospace sector, for instance from Kongsberg Defence &

Aerospace and from Saab AB (Business Unit Avionics Systems).

Total order backlog was NOK 830 million, compared to NOK 859 million at the same

time last year. Growth in Data/Telecom and Medical sectors offset reductions in

the Offshore/Marine Sector.

Cash flow significantly improved

Operating cash flow was NOK 48.6 million, compared to 9.5 million in the second

quarter of 2014. This is primarily related to the improvement in profit and

development of working capital. Working capital reduction actions continue to be

in focus.

Outlook

For 2015, Kitron expects growth and a clear improvement in profitability. Growth

is driven by increased demand in the Defence sector for US and Norwegian

markets, as well as increases in Energy/Telecoms and Industry. Offshore/Marine

will have a reduction due to the oil service market in Norway.

Enclosed in PDF are the quarterly report and the presentation.

The interim report is presented today at 2:00 p.m. CEST at Kitron ASA's head

office, Olav Brunborgs vei 4, Billingstad.

The presentation will be given in English by CEO Peter Nilsson and CFO Cathrin

Nylander, and will be distributed through webcast at the same time at the

following link:

http://webtv.hegnar.no/presentation.php?webcastId=21823513

For further information, please contact:

Peter Nilsson, CEO, Tel: +47 948 40 850 or e-mail: peter.nilsson@kitron.com

Cathrin Nylander, CFO, Tel: +47 900 43 284 or e-mail:

cathrin.nylander@kitron.com

Kitron is one of Scandinavia's leading electronics manufacturing services

companies for the Defence/Aerospace, Energy/Telecoms, Industry, Medical

equipment and Offshore/Marine sectors. The company is located in Norway, Sweden,

Lithuania, Germany, China and the United States. Kitron had revenues of about

NOK 1.75 billion in 2014 and has about 1 200 employees. www.kitron.com

This information is subject of the disclosure requirements acc. to §5-12 vphl

(Norwegian Securities Trading Act).

[HUG#1937624]