DGAP-News: paragon AG / Key word(s): Half Year Results

20.08.2014 / 10:02


paragon's revenue and profit remain on course

  - Consolidated revenue up by 5.9 percent in the first half of 2014

  - Earnings figures ahead of budget

  - Strong demand in current business

  - Managing Board confirms forecast for 2014

Delbrück, August 20, 2014 - As a result of sustained high demand in its
current business, paragon AG has reported revenue and earnings for the
first half of 2014 that remain above its own expectations. Consolidated
revenue grew by 5.9 percent to EUR37.8 million in the first six months (H1
2013: EUR35.7 million). Although earnings before interest and tax (EBIT)
declined from EUR2.9 million to EUR1.5 million due to substantial capital
investment in new business segments, they were still ahead of budget. The
Managing Board expects this positive course of business to continue in the
second half of the year and for the Company's financial performance to
improve considerably. By June 30, 2014, customers had already placed
call-off orders covering more than 97.2 percent of the total revenue
anticipated for the current year. That is why the Managing Board of paragon
AG has reiterated its forecast for the year, with revenue growth of around
8 percent and an EBIT margin of approximately 10 percent.

"We are currently seeing an encouraging trend in the business segments and
therefore remain optimistic for the second half of the year," said Klaus
Dieter Frers, Chairman of the Managing Board. "We are continuing to
experience extremely strong demand, particularly in Electromobility,
although it is still difficult to predict accurately whether current orders
will be shipped and the associated revenue recognized in 2014 or 2015.
What's more, we are doing better than expected in most of our other
business segments."

Significant investment for the future
Operating business in the first half of 2014 was dominated by a good level
of existing business involving products for premium manufacturers. The
fledgling Body Works Kinematics and Electromobility business segments saw
continued success, notching up a number of new orders. paragon invested a
further EUR1.4 million in the establishment and expansion of its new
business segments as part of its growth strategy for the future. As
expected, the cost of materials and personnel expenses both increased,
largely due to the hiring of new staff and to one-off third-party services
for development and production in the Acoustics, Body Works Kinematics, and
Electromobility business segments. Due to these upfront investments EBIT
decreased to EUR1.5 million year on year (H1 2013: EUR2.9 million).
Consequently, the EBIT margin declined from 8.3 percent to 4.0 percent.

The Managing Board anticipates that the ratios for cost of materials and
personnel expenses will return to normal during the remaining months of the
year, having been exceptionally high in the first six months of 2014.
Adjusted for the significant level of investment for the future, EBIT would
have been at the same level as in the first half of 2013 with an EBIT
margin of 7.7 percent. Overall, paragon AG's net profit for the first half
of 2014 amounted to EUR0.4 million calculated in accordance with IFRS (H1
2013: EUR1.8 million). Earnings per share came to EUR0.09 (H1 2013:

Forging ahead with internationalization
paragon founded Voltabox of Texas, Inc. as part of its internationalization
strategy and has now begun to set up the plant and hire new employees.
Production is still scheduled to commence in late autumn 2014. The spin-off
of the Electromobility business segment under the new Voltabox brand, which
was approved by the Annual General Meeting, means Electromobility can be
positioned independently in the market. It is now represented by the wholly
owned subsidiaries Voltabox Deutschland GmbH and Voltabox of Texas, Inc. In
May 2014, Voltabox of Texas, Inc. has received a major order for battery
packs in the double-digit millions of dollars.

paragon also continued to push ahead with expansion in the Chinese market,
especially in the second quarter. To this end, it has signed a letter of
intent with a leading supplier to the automotive industry regarding the
establishment of a joint venture. paragon is aiming for a controlling
interest of 65 percent, with production in China starting in 2015.

Overall, the Managing Board believes the market offers considerable
opportunities for 2014 and, above all, for 2015 and 2016 - accompanied by a
substantial rise in revenue. For 2014, the Managing Board has reiterated
its forecast for revenue growth of around 8 percent and an EBIT margin of
approximately 10 percent.

At 2 p.m. on September 1, 2014, paragon will again be showcasing itself to
a large audience at the twelfth SCC Small Cap Conference in Frankfurt,
where it will be speaking to analysts and investors and answering their

Company profile
Listed in the regulated market (Prime Standard) of Deutsche Börse AG in
Frankfurt am Main, paragon AG develops, produces, and sells advanced
automotive electronics solutions. The portfolio of this direct supplier to
the automotive industry includes products in the following business
segments: Sensors, Acoustics, Cockpit, Electromobility, and Body Works
Kinematics. Headquartered in Delbrück (North Rhine-Westphalia), paragon AG
has branches in Suhl (Thuringia), Nuremberg (Bavaria), and St. Georgen
(Baden-Württemberg) as well as a sales office in Shanghai (China) and a
subsidiary in Austin (Texas, United States).


paragon AG
Schwalbenweg 29
33129 Delbrück
Tel.: +49 (0)5250 97620
Fax: +49 (0)5250 976 260
Website: www.paragon.ag
Email: info@paragon.ag

Financial press & investor relations contact
Instinctif Deutschland GmbH
Michael Müller
Tel.:  +49 (0)221 420 750
Email: michael.mueller@instinctif.com


20.08.2014 Dissemination of a Corporate News, transmitted by DGAP - a
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Language:    English                                               
Company:     paragon AG                                            
             Schwalbenweg 29                                       
             33129 Delbrück                                        
Phone:       +49 (0)5250 97 62 - 0                                 
Fax:         +49 (0)5250 97 62 - 60                                
E-mail:      investor@paragon.ag                                   
Internet:    www.paragon.ag                                        
ISIN:        DE0005558696, DE000A1TND93                            
WKN:         555869, A1TND9                                        
Listed:      Regulierter Markt in Frankfurt (Prime Standard);      
             Freiverkehr in Berlin, Düsseldorf, Hamburg, München,  
End of News    DGAP News-Service  
282985 20.08.2014