EVOX RIFA GROUP OYJ STOCK EXCHANGE RELEASE
on February 14, 2002 at 13:00 p.m.

EVOX RIFA GROUP FINANCIAL PERFORMANCE 1.1. — 31.12.2001

• Net sales decreased almost by 18 % to EUR 69.0 million (EUR 84.2 million in 2000)

• Operating loss was EUR 4.8 million (operating profit EUR 4.1 million)

• Loss before extraordinary items was EUR 6.4 million (profit EUR 2.5 million)

• Earnings per share was EUR -0.059 (EUR 0.014)

• The Board of Directors proposes that no dividend be distributed from the fiscal period

STRUCTURAL REORGANISATION OF THE GROUP

During 2001 Evox Rifa acquired the whole share capital of the Swedish company, Dectron AB, and concluded an agreement to start a joint venture with a Chinese company called Nantong Jianghai Capacitor Factory. The name of the joint venture is Nantong Evox Rifa Electrolytics Co., Ltd. and Evox Rifa’s ownership is 80%.

The mother company of the group is Evox Rifa Group Oyj, Finland; the other group companies (in addition to the above mentioned) are Evox Rifa Oy, Finland, Evox Rifa AB, Sweden; Evox Rifa Pte. Ltd, Singapore; Seoryong Singapore Pte. Ltd, Singapore; P.T. Evox S.R., Indonesia; Evox Rifa Sdn.Bhd., Malesia; Evox Rifa GmbH, Germany; Evox Rifa (U.K.) Ltd, United Kingdom; and Evox Rifa Inc, the United States.

Evox Rifa’s 30 percent ownership in Schaffner EMC Pte. Ltd., Singapore, was sold to the main owner.

FINANCIAL DEVELOPMENT

The financial information presented in this stock exchange release are given as pro forma figures for the periods of comparison from the previous year. Evox Rifa Group Oyj was established on October 30, 2000 as a result of Finvest Oyj’s demerger, and therefore, actual figures for comparison do not exist.

Net sales

The net sales of the group were EUR 69,0 million at the end of the fiscal year 2001 which is about 18 % less than in the previous year (EUR 84.2 million in 2000) following a strong downward trend in world economics which started already at the beginning of 2001.

The net sales decreased most in North American markets, by 26%. Telecommunications customer sector suffered most from the effects of the global recession. For comparison, the global semiconductor business in total decreased by 31,9% in 2001.

Out of the product groups of Evox Rifa, the sales of aluminium electrolytic capacitors increased slightly compared to the previous year, due to the fact that their customer segments, industrial electronics and automotive industry, were not that strongly affected by the economic downturn.

During 2001 Evox Rifa managed to get its products into a growing number of new applications in automotive industry, and got notable new customers in industrial electronics. Industrial electronics sector strongly increased their relative share of Evox Rifa’s revenues, to 24 per cent, being the largest of the company’s customer segments.

Aluminium electrolytic capacitors increased their relative share of Evox Rifa’s product groups comprising nearly 30% of the total revenues. However, film capacitors still formed the largest single product group covering one third of the company’s net sales.

In 2001 the share of customised product variants and special products of the net sales increased significantly. This development is in line with Evox Rifa’s strategy according to which the company invests in solving technical problems of demanding customers.

Profit

The group’s profitability considerably weakened compared to the previous year due to low sales volume. Operating loss was EUR 4.8 million (operating profit EUR 4.1 million in 2000). Loss before extraordinary items was EUR 6.4 million (profit EUR 2.5 million in 2000).

Earnings per share was EUR -0.059 (EUR 0.014) and shareholders’ equity per share EUR 0.296 (EUR 0.356).

Order backlog

The order backlog of Evox Rifa Group quickly decreased due to unfavourable market situation being EUR 10.5 million at the end of the year 2001 (EUR 35.6 million at the end of 2000). Ordering and delivery times shortened towards the end of the year.

FINANCIAL STATUS AND CAPITAL EXPENDITURE

The financial status of Evox Rifa Group weakened during 2001. However, the cash flow was positive after changes in the working capital due to savings programs and other actions which were carried out to improve the cash flow.

The important strategic investments were successfully carried out in spite of the weak financial situation, i.e. investments into improving the efficiency of production, acquisition of Dectron AB and starting of the Chinese joint venture (Nantong Evox Rifa Electrolytics Co., Ltd.). Gross capital expenditure into fixed assets amounted to EUR 5.9 million.

Regardless of the strong decrease in revenues in 2001, the R & D input was maintained nearly at the same level as in the previous year. The R & D investment target — 8 % of the revenues in 2005 - has not been changed. The biggest investments in 2001 were made into the development of aluminium electrolytic capacitors.

At the end of the year, the group’s liquid assets were EUR 6.4 million and the company’s net debt was approximately EUR 10,5 million. The group’s equity ratio was 47.5 % (48.7% in 2000).

SHARES AND SHARE CAPITAL

The nominal value of the shares of Evox Rifa Group Oyj is EUR 0.05. On December 31, 2001 the number of shares was 86 685 509 and the share capital was EUR 4 334 275.45.

On April 11, 2001, the Shareholders’ Meeting of Evox Rifa Group Oyj resolved to authorise the Board of Directors to decide to increase the share capital by one or several new issues and/or to take one or several convertible loans, so that in a new issue of shares and/or in convertible loans the share capital may be increased by an aggregate maximum amount of EUR 866,855.

The above mentioned Shareholders’ Meeting also resolved to cancel the authorisation given by the Shareholders’ Meeting on 14 November, 2001. The Board of Directors did not use this authorisation. (All the proposals by the Board of Directors were listed in the invitation to Shareholders’ Meeting published on March 20, 2001 as a Stock Exchange Bulletin).

PERSONNEL

The number of personnel of Evox Rifa Group at the end of the fiscal year was 1186 (1504 in 2000), of which 941 (1256) were workers and 245 (248) office staff. There were an average of 1336 (1406) employees during the fiscal year, of which 1095 (1164) were workers and 241 (242) office staff.

Average personnel distribution during 2001:

Asia: 460 (604 in 2000)

Europe: 704 (872)

USA: 22 (28)

Due to weak market situation Evox Rifa carried out strong saving programs regarding personnel. Temporary lay-offs concerning all personnel groups continue at Suomussalmi factory and personnel negotiations are going on concerning permanent lay-offs of about 40 people. A decision has been reached about permanent lay-offs of nearly 150 people at Evox Rifa’s Swedish factories. These personnel reductions will mainly take effect during the spring of 2002.

THE BOARD’S PROPOSAL FOR DIVIDEND DISTRIBUTION

The Board of Directors propose to the Annual Shareholders’ Meeting to be held on 27 March 2002, that no dividend be distributed from the fiscal period.

OUTLOOK FOR THE YEAR 2002

Economic uncertainty will continue during 2002 in most of the customer sectors of Evox Rifa. Therefore, estimating market development is difficult. However, some customer sectors do expect slight turn to better beginning in the second quarter.

Evox Rifa’s result of the first quarter of 2002 will remain negative due to the cost effects of the personnel reductions. The savings resulting from the lay-offs will take effect during the second quarter only.

Improving profitability and cash flow are the primary goals for 2002. We will also develop our ability to more flexibly adjust into quickly changing new market situations and to the resulting new economic environment.

The new Chinese factory for producing electrolytic capacitors will start up during the second quarter of 2002. This factory will bring about a considerable addition to our product range and improvement to our competitiveness globally.

INCOME STATEMENT OF THE GROUP (1000 EUR)

Unaudited

 

BALANCE SHEET OF THE GROUP (1000 EUR)

Unaudited

KEY FIGURES OF THE GROUP

Unaudited

DERIVATIVE CONTRACTS

The company uses forward contracts and currency options to hedge foreign currency denominated balance sheet items against exchange rate fluctuations. The maturity of forward contracts and currency options vary from 1 to 3 months.

The market values of derivative contracts made to hedge the exchange rates fluctuations (1000 EUR):

Currency options

ANNUAL SHAREHOLDERS’ MEETING

The Annual Shareholders’ Meeting of Evox Rifa Group Oyj will be held on Wednesday 27 March, 2002 at 11:00 a.m., at the Auditorio Corona, Lars Sonckin kaari 16, 02600 Espoo. The balancing date of the meeting is 15 March, 2002.

ANNUAL REPORT 2001

Evox Rifa Group Oyj’s annual report will be published during week 12, 2002.

In Helsinki, February 14, 2002

Evox Rifa Group Oyj’s Board of Directors

Evox Rifa Group Oyj
Harri Launonen
President

Further information:

Evox Rifa Group Oyj,
Harri Launonen, President,
tel.: +358 9 5406 5001
harri.launonen@evoxrifa.com

Pekka Lopperi
CFO
tel: +358 9 5406 5003
pekka.lopperi@evoxrifa.com

DISTRIBUTION:

Helsinki Exchanges
Key media