paragon AG / Quarter Results

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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

Head of 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) 2 11 - 3 01 26-0
Fax: +49 (0) 2 11 - 3 01 26-172

06.05.2008  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