Strong first quarter for paragon AG

paragon AG / Quarter Results Release of an Ad hoc announcement according to § 15 WpHG, transmitted by DGAP - a company of EquityStory AG. The issuer is solely responsible for the content of this announcement. ---------------------------------------------------------------------- Strong first quarter for paragon AG · Sales revenue from Automotive business up 20.6 percent · Car Media Systems driving sales growth with 40.4 percent increase · Strong growth in operating cash flow to €2.4 million · Orders on hand up 55 percent year on year Delbrück, May 6, 2008 - In the first three months of the year, paragon's total sales were up by around 15 percent to €29.4 million, while orders on hand reached a record level. In the dominant Automotive segment, which accounts for 83 percent of sales, the Car Media Systems business unit performed particularly well, raising sales by 40.4 percent. The core Automotive business performed particularly well with EBIT up 11.6 percent to €2.1 million and sales up 20.6 percent to €24.3 million. In the Electronic Solutions segment, sales fell slightly from €5.4 million to €5.1 million, in particular as a result of shifts in exchange rates. As a result of the earnings growth of paragon firstronic in Germany, EBIT remained virtually unchanged at €222 thousand (Q1 2007: €268 thousand). Overall, paragon was able to significantly improve its profit from operations. While earnings before interest, tax, depreciation and amortisation (EBITDA) increased by 13.7 percent from €4.9 million to €5.6 million, EBIT rose by 8.0 percent to €2.3 million. At 8.0 percent of sales, the EBIT margin is higher than the 6.2 percent margin achieved for 2007 as a whole. The extraordinary charges resulting from the exchange of profit-sharing rights resulted in a drop in profit for the first quarter of 2008 to €241 thousand (Q1 2007: €565 thousand), as had been anticipated. However, this also means that the company will benefit from significantly lower interest payments in future. Earnings per share amounted to €0.06 (Q1 2007: €0.14). The level of operating cash flow is evidence of the company's earnings power; during the period under review, paragon reported a significantly higher net cash inflow of €2.4 million. paragon is preparing for the next surge in growth with its recent introduction of a key-account structure and the merger of three business units in the Automotive segment into the Cockpit Systems and Sensory Systems/Actuating Systems divisions.. Orders on hand saw a 55 percent year-on-year increase in the first quarter, and during the current financial year, the Managing Board anticipates further sales growth of between 5 and 10 percent and even higher earnings growth. About paragon paragon AG is a direct supplier to the automotive industry and is listed on the Deutsche Börse Prime Standard index in Frankfurt/Main, Germany. The Company develops, manufactures, and markets innovative solutions in its Automotive (Car Media Systems/Climate Systems/Instrumentation and Control Systems), Electronic Solutions, and Building Technology divisions. Its product portfolio includes the world’s leading AQS air quality sensor by far as well as hands-free speaking equipment and instrumentation systems. In addition to its headquarters in Delbrück, North Rhine-Westphalia, paragon also operates locations in Suhl, Thuringia (production), Cadolzburg, Bavaria (car media systems), St. Georgen, Baden-Württemberg (instrumentation systems) and Heidenheim, Baden-Württemberg (Electronic Solutions sales). In the international arena, the paragon Group is represented by wholly-owned subsidiaries in Grand Rapids, Michigan, USA (development, production, and sales) and Osaka, Japan (applications and sales) as well as sales offices in Paris, France and Turin, Italy. In fiscal 2007, the paragon Group generated sales totaling €108.9 million with a workforce of 594 employees. paragon AG Schwalbenweg 29 33129 Delbrück Phone: +49 (0) 52 50 - 97 62-0 Fax: +49 (0) 52 50 - 97 62-60 Internet: www.paragon-online.de E-mail: info@paragon-online.de Head of Corporate Communications Matthias Hack Phone: +49 (0) 52 50 - 97 62-141 Fax: +49 (0) 52 50 - 97 62-60 E-mail: matthias.hack@paragon-online.de Investor Relations Haubrok Investor Relations GmbH Thomas Vormann Phone: +49 (0) 2 11 - 3 01 26-0 Fax: +49 (0) 2 11 - 3 01 26-172 E-Mail: t.vormann@haubrok.de 06.05.2008 Financial News transmitted by DGAP ---------------------------------------------------------------------- Language: English Issuer: paragon AG Schwalbenweg 29 33129 Delbrück Deutschland Phone: +49 (0)5250 97 62 - 0 Fax: +49 (0)5250 97 62 - 60 E-mail: investor@paragon-online.de Internet: www.paragon-online.de ISIN: DE0005558696 WKN: 555869 Listed: Regulierter Markt in Frankfurt (Prime Standard); Freiverkehr in Berlin, München, Hamburg, Düsseldorf, Stuttgart End of News DGAP News-Service ---------------------------------------------------------------------------