paragon Starts Fiscal 2008 with New Strength

paragon AG / Final 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. ---------------------------------------------------------------------- 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 Internet: www.paragon-online.de Email: info@paragon-online.de Director, Corporate Communications Matthias Hack Phone: +49 (0) 52 50 - 97 62-141 Fax: +49 (0) 52 50 - 97 62-60 Email: matthias.hack@paragon-online.de Investor Relations Haubrok Investor Relations GmbH Thomas Vormann Phone: +49 (0) 52 50 - 97 62-140 Email: t.vormann@haubrok.de 31.03.2008 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 ---------------------------------------------------------------------------