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Weak start - strong finish

Kongsberg Gruppen (KONGSBERG) reports an EBITA of MNOK 383 (MNOK 485) for 2003. Operating revenues totalled MNOK 6 651, compared with MNOK 6 980 in 2002. "The year started out weak, but new orders and results picked up considerably towards year end. The operating profit prior to depreciation for goodwill was MNOK 151 (MNOK 142) in Q4, making it one of our best quarters ever", states Chief Executive Officer Jan Erik Korssjøen.

The EBT (earnings before tax) for 2003 came to MNOK 190 (MNOK 291), while the profit per share was NOK 4.23 (NOK 7.21). Equity capital added up to NOK 1.8 billion, resulting in an equity ratio of 30.5 per cent (31.1%).

"KONGSBERG has earned somewhat lower operating revenues and profits than in 2002. The reduction in operating revenues in 2003 is ascribable to a dip in new orders in late 2002. The result also reflects the MNOK 50 arbitration case we lost in Q1", continues Korssjøen. The CEO was, however, satisfied with results and new orders alike in the latter half of 2003. The backlog of orders at year end aggregated NOK 5.91 billion, up MNOK 770 from year-end 2002. Defence and Maritime both contributed to the increase.

The results were weaker in 2003 than in 2002 primarily as a result of various defence-related issues. The most important factor is that a certain amount of volume moved from the product areas, where the margins are high, to areas where the margins are somewhat lower. "To increase our profitability, we are in the process of downsizing by 70 man-years of labour in the missile area and 50 man-years in the military communications area", explains the CEO.

"KONGSBERG has improved its strategic market position through acquisitions and the establishment of new businesses. We have strengthened our international presence and moved resources and a number of employees closer to customers, not least by setting up new offices and companies in Europe, Africa, North and South America, and the Far East. Having spent roughly MNOK 700 on R&D in 2003, KONGSBERG also maintains a high level of research and development.

"On the whole, we expect another good year in 2004", concludes Chief Executive Officer Jan Erik Korssjøen.

For further information, please contact: Chief Executive Officer Jan Erik Korssjøen Telephone: ( 47) 322-89510 - ( 47) 920-60000 Chief Financial Officer Arne Solberg Telephone: ( 47) 322-89575 - ( 47) 920-60011

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