CARDO AB Interim report, January - September 2003

10/29/2003 4:33 AM EST

CARDO AB
Interim report, January - September 2003

· Invoiced sales: SEK 5,528 million (7,957*)
· Net earnings: SEK 173 million (526*)
· Earnings per share: SEK 5.78 (17.54*)
· Earnings after financial items in the current operations:
SEK 248 million (233)
· Earnings per share in the current operations: SEK 5.78 (5.42)

* The Rail business area was disposed of on September 25 2002 and is
included in the consolidated financial statements for the previous year
until the time of disposal. The previous year's earnings also include
the capital gain of SEK 323 million on the disposal. The income
statement and cash flow broken down by current operations and the
operation disposed of are shown in enclosure 4.

The Group's inflow of orders during the period amounted to SEK 5,761
million (8,447). Adjusted for the effects of exchange rate movements and
the disposal of Rail, this is a decrease of 4 percent, which is entirely
attributable to Cardo Door. Company acquisitions made a positive
contribution of 1 percentage point.

Invoiced sales amounted to SEK 5,528 million (7,957). Adjusted for the
effects of exchange rate movements and the disposal of Rail, this is a
decrease of 4 percent. Company acquisitions made a positive contribution
of 1 percentage point.

Net earnings amounted to SEK 173 million (526), which is equivalent to
SEK 5.78 (17.54) per share. The figures for the previous year include
Rail's earnings until the time of disposal and the capital gain on the
disposal, in all SEK 363 million.

Current operations
The Group's current operations consist of the Cardo Door and Cardo Pump
business areas.

Operating earnings in the current operations amounted to SEK 262 million
(259) during the period. Compared with the previous year, Pump's
earnings rose during the third quarter, while Door's were lower in
consequence of the construction market in Europe remaining weak.

Earnings after financial items amounted to SEK 248 million (233). The
impact of exchange rate movements on earnings was only marginal.

Net earnings amounted to SEK 173 million (163), which is equivalent to
SEK 5.78 (5.42) per share.

Cash flow from operations was SEK 461 million (460) after tax, which is
equivalent to SEK 15.37 (15.33) per share. Adjusted for the effects of
exchange rate movements on the change in working capital, cash flow
after tax was SEK 13.03 (13.20) per share.

Cardo Door
Cardo Door's inflow of orders was, after adjustment for the effects of
exchange rate movements, 8 percent lower than the previous year. Company
acquisitions made a positive contribution of 1 percentage point.

Demand for industrial doors and dock loading systems was considerably
weaker than during the corresponding period 2002. The trend for service,
which accounts for approximately a quarter of Cardo Door's turnover,
remained good. For residential garage doors, demand was lower than the
previous year.

Invoiced sales amounted to SEK 3,435 million (3,791), which adjusted for
the effects of exchange rate movements is a decrease of 7 percent.
Company acquisitions made a positive contribution of 1 percentage point.
Operating earnings amounted to SEK 146 million (177).

Cardo Pump
The inflow of orders rose by 1 percent after adjustment for the effects
of exchange rate movements.

In water and wastewater and in building services, demand was somewhat
lower than the previous year, while it increased from the process
industry.

Invoiced sales amounted to SEK 2,093 million (2,191), which adjusted for
the effects of exchange rate movements is on a par with the previous
year. Operating earnings amounted to SEK 161 million (126).

Liquidity and financing
At September 30, the Group's liquid funds stood at SEK 170 million
(1,186) compared with SEK 922 million at the beginning of the year. In
addition, there are unutilized credit facilities of approximately SEK
1.9 billion (3.4).

The Group's gross investments, excluding company acquisitions, stood at
SEK 205 million (227).

Net interest bearing debt at September 30 amounted to SEK 410 million
compared with net liquid funds of SEK 456 million the previous year and
SEK 593 million at the beginning of the year.

Equity amounted to SEK 2,726 million (3,743), which is equivalent to SEK
90.86 (124.78) per share.

The Group's equity ratio at September 30 was 53.7 percent (58.0).

Personnel
The number of employees in the Group at September 30 was 5,941 (6,306).

Company acquisitions
As of January 2003, Cardo Door includes the acquired company SEA B2L
with an annual turnover of approximately SEK 70 million.

Accounting principles
The report has been drawn up in accordance with recommendation RR 20 of
the Swedish Financial Accounting Standards Council concerning interim
reports. The accounting principles used are the same as in the annual
report for 2002 except for the new recommendations of the Swedish
Financial Accounting Standards Council effective as of January 1 2003.
The application of the new recommendations has not given rise to any
adjustment of previously reported periods.

The parent company
The parent company's earnings after financial items amounted to SEK -12
million (584), its gross investments to SEK 0 million (0) and its liquid
funds to SEK 0 million (0) as against SEK 176 million at the beginning
of the year.


Nominations committee
The Annual General Meeting has resolved to appoint a nominations
committee consisting of the Chairman of the Board, who is to be the
convener, and one representative of each of the Company's three largest
shareholders at September 30 each year. The duties of the nominations
committee are to submit proposals to the Annual General Meeting in
respect of the election of the Board of Directors, auditors whenever
applicable and fees. The nominations committee that has been appointed
ahead of the 2004 Annual General Meeting consists of:

Fredrik Lundberg (Chairman of Cardo), L E Lundbergföretagen AB,
Stockholm
Mats Andersson, National Swedish Pension Fund, 3rd Fund Board, Stockholm
Ramsay Brufer, Alecta, Stockholm

Market prospects
The assessment that there is still uncertainty about the market trend
continues to apply. There are signals of a certain degree of
stabilization of the general market situation, but few signs indicating
imminent improvement. For Cardo's part, this means continued focus on
cost adjustment and improvements in efficiency.

Malmö, Sweden, October 29 2003

Cardo AB (publ)

Kjell Svensson
President and CEO

This report has not been subjected to special examination by the
Company's auditors.

Cardo's report on operations for the whole of 2003 will be published on
February 10 2004.

Enclosures: 1. Invoiced sales, earnings and operating margin by business area
2. Consolidated income statement and balance sheet in brief
3. Consolidated cash flow statement in brief
4. Income statement and cash flow broken down by current
operations and operation disposed of
5. Group financial summary

For further information, please contact:
Kjell Svensson, President and CEO, phone +46 40 35 04 53, +46 40 35 04 00
Göran Axeheim, Executive Vice President and CFO, phone +46 40 35 04 42,
+46 40 35 04 00
Christer Roskvist, Head of Public Relations, phone +46 40 35 04 25,
+46 40 35 04 00

Cardo is an international engineering group and a leading supplier of
high-quality products and systems with a good aftermarket. Cardo holds
strong positions in the markets for doors and pumps. Cardo has
subsidiaries in about 30 countries with the focal point resting in
western Europe.