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Eltek ASA - Report third quarter and first nine months 2011


October 27, 2011 - London

Eltek reported continued revenue growth, improved gross margin and significantly higher operating profit (EBIT) also in the third quarter 2011. Revenue amounted to NOK 1,023 million, up four percent from the third quarter 2010, whereas EBIT increased by 48 percent to NOK 59 million. Profit before tax was NOK 40 million and net profit NOK 28 million.

The growth was primarily driven by continued solid performance in the telecom business. Eltek Valere reported revenue of NOK 843 million in the third quarter, an increase of six percent from the third quarter 2010 and up 13 percent on a currency adjusted basis. Gross margin was 27.8 percent, contributing to a 17 percent increase in EBIT to NOK 63 million. Order entry was NOK 914 million, a decline of eight percent from the third quarter 2010 but an increase of eight percent from the previous quarter. The order book increased 10 percent during the quarter, to NOK 836 million.

The development in order entry and backlog indicates that the current economic turmoil so far has had limited effect on the demand for the company's products and services. However, it should be noted that demand visibility remains limited due to the persistent uncertainty with regards to economic growth and capital spending going forward.

Eltek Valere reported strong revenue figures in the second half 2010, and the company still believes it will be challenging to match this in the second half 2011. However, the recent order entry and current order backlog give rise to cautious optimism.

Nera Telecommunications reported revenue of NOK 180 million in the third quarter, a decline of six percent from the same quarter last year but a flat development on a currency adjusted basis. Gross margin was high at 29.1 percent, generating more than a doubling in EBIT to NOK 15 million in the third quarter.

For the first nine months 2011, total revenue in Eltek increased by nine percent to 3,034 million, whereas EBIT increased by 85 percent to NOK 186 million. Profit before tax was NOK 121 million and net profit from continuing operations NOK 81 million for the first nine months, whereas net profit including discontinued operations was NOK 52 million.

Please find enclosed the interim report for the third quarter and first nine months 2011 on http://www.newsweb.no.

This information is subject of the disclosure requirements acc. to §5-12 vphl (Norwegian Securities Trading Act).

3Q 2011 Key Figures Eltek
3Q 2011 Report Eltek



This announcement is distributed by Thomson Reuters on behalf of Thomson Reuters clients.

The owner of this announcement warrants that:
(i) the releases contained herein are protected by copyright and other applicable laws; and
(ii) they are solely responsible for the content, accuracy and originality of the
information contained therein.

Source: Eltek ASA via Thomson Reuters ONE

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