paragon AG / Final Results

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paragon Starts Fiscal 2008 with New Strength
· Automotive products post 6.7% growth in sales in 2007
· Net income up 11.7% in 2007
· Cash flow from operating activities increases 47.2%
· Positive start to fiscal year 2008

Delbrück, March 31, 2008 – In the year recently ended, the Automotive
business segment was once again the growth driver in the paragon Group.
Among other performance indicators, the direct supplier to the automotive
industry increased its sales of own products by 6.7% to €88.5 million.

Due to robust growth in the Automotive business segment (80% share of
sales), the company was nearly able to compensate for the fact that it
refrained from merchandise sales. Total sales in 2007 remained at the level
of the prior year at €108.9 million. Currency-adjusted gross Group sales
amounted to €110.4 million and met the Managing Board’s expectations for
2007. paragon took advantage of fiscal 2007 to invest in the future. R&D
expenditures were roughly as high as in the prior year, and the additional
expense associated with the replacement of high-interest profit-sharing
rights with profit-sharing rights with a lower interest rate will lead to
significantly lower interest payments in the future.

Due to the fact that other operating expenditures were 12.5% higher on the
whole, earnings before interest and taxes (EBIT) dropped from €8.4 million
to €6.8 million. Net income, on the other hand, grew significantly. As a
result of tax effects, it rose 11.7% to €2.5 million (2006: €2.2 million).
Earnings per share are now €0.60, up from €0.54 in the previous year.
paragon’s financial power remains strong. Cash flow from operating
activities increased 47.2% to €6.2 million (2006: €4.2 million) and
substantially improved the company’s internal financing strength. The
Supervisory Board and Managing Board intend to propose a dividend of €0.10
per share for fiscal 2007 at the Annual General Meeting (2006: €0.30).
The Electronic Solutions business segment recorded an 8.8% rise in sales in
Europe and generated a total of €20.4 million in sales worldwide (2006:
€23.1 million). In the USA the consolidation of the business segment was
successfully continued. The negative contribution to earnings of the U.S.
subsidiary was greatly minimized. paragon expects to reach a break-even
point in this market in 2008.

In the past fiscal year, paragon made important advances in moving up the
supply chain and positioning itself as a system supplier by initiating the
Artega project. The company will resolutely continue to pursue this trend
in 2008 by increasing its focus on the growing cockpit systems market to
take advantage of additional sales and margin potential. The first
successes in using Artega interior components in mass production are
already apparent. The Artega project was also instrumental in increasing
paragon’s order level to €314.9 million by as early as mid-March 2008. Of
this total, some €104 million relate to orders placed for 2008; this means
nearly the entire projected sales of the current year have already been
covered.  In the current fiscal year, the Managing Board anticipates a 5.0
to 10.0% rise in sales along with disproportionately high growth in the
operating result. The good start in 2008 confirms this projection.

paragon AG
Schwalbenweg 29
33129 Delbrück
Phone: +49 (0) 52 50 - 97 62-0
Fax: +49 (0) 52 50 - 97 62-60

Director, Corporate Communications
Matthias Hack
Phone: +49 (0) 52 50 - 97 62-141
Fax: +49 (0) 52 50 - 97 62-60

Investor Relations
Haubrok Investor Relations GmbH
Thomas Vormann
Phone: +49 (0) 52 50 - 97 62-140

31.03.2008  Financial News transmitted by DGAP
Language:     English
Issuer:       paragon AG
              Schwalbenweg 29
              33129 Delbrück
Phone:        +49 (0)5250 97 62 - 0
Fax:          +49 (0)5250 97 62 - 60
ISIN:         DE0005558696
WKN:          555869
Listed:       Regulierter Markt in Frankfurt (Prime Standard); Freiverkehr
              in Berlin, München, Hamburg, Düsseldorf, Stuttgart
End of News                                     DGAP News-Service