PSI Strengthens Program for Structural Improvement - Group sales reach 57.2 million euros (2003: 65.8 million euros) - EBIT at –8.6 million euros (2003: –1.3 million euros) after special burdens - Program for the improvement of sales and cost structu

Berlin, 3 August 2004 – The PSI Group had sales of 57.2 million euros (2003: 65.8 million euros) in the first half of 2004. The EBIT was –8.6 million euros (2003: –1.3 million euros) in the first six months. The consolidated result for 30 June 2004 was –8.9 million euros (2003: –1.1 million euros). These include a one-off burden of 4.2 million euros from a lawsuit from 2000 and the loss of expected licensing income of 1.2 million euros in the telecommunications business. The number of employees decreased to 1,144 (30 June 2003: 1, 242) as of 30 June.


The segment Network Management (energy, telecommunication, traffic) suffered once again under the delayed investments in the expansion of the UMTS infrastructure and continuing uncertainties about the regulation of the gas market. The Electrical Energy business again developed very positively. The sales in Network Management decreased in the first six months by 13.6% to 30.4 million euros (2003: 35.2 million euros) and the EBIT decreased to –1.9 million euros (2003: 1.6 million euros). In the Production Management segment (industry, logistics) sales decreased by 10.7% to 19.9 million euros (2003: 22.3 million euros). The EBIT decreased by 0.4 million euros to –2.8 million euros (2003: –2.4 million euros). In Information Management (authorities, service providers) sales decreased by 17.2% to 6.9 million euros (2003: 8.4 million euros), while the EBIT decreased by 3.3 million euros to –3.8 million euros (2003: –0.5 million euros). Without the effect from the lawsuit this corresponds to an improvement on –0.3 million euros.


New orders increased significantly in June again following slow months in April and May and reached 61 million euros in the first six months. The positive trend of the previous month stabilized itself in the beginning of the third quarter. In July, normally a slow month, new orders totaled 9 million euros, about 20 % above the same period for 2003. With 68 million euros, the order books on 30 June were about one million above the same day last year.

The Group equity capitalization on 30 June 2004 was 36%. The liquidity of 11.6 million euros on 30 June 2004 (2003: 20.4 million euros) will increase in the course of the second half of the year.


To utilize synergy effects in Information Management, all the activities of the segment have been merged into one business unit. In the second quarter as well PSI continued to expand the control systems business in Information Management and continued to demonstrate progress. In the 3rd quarter, the new PSIpenta version 7 will be launched. With the successful conclusion of the first projects on the basis of the new network management products for the mobile communications and gas markets at the end of the second quarter, the prerequisites for an improved business in the fields of telecommunication and gas have been established.


PSI will increase the efforts toward the improvement of the sales and cost structure in the course of the structural improvement program. The aim of this program is to increase the maintenance percentage of sales to 20 % and the increase of export sales. For the entire year the Management Board therefore expects sales of 120 million euros and a positive result in the fourth quarter at the latest.


PSI AG develops and integrates individual solutions, on the basis of its own software, for the management of large networks (electricity, gas, oil, telecommunications, transport), cross-company production management (steel, chemicals, machinery, automotive, logistics) and information management for government and service providers. PSI was founded in 1969 and currently employs 1,150 persons in the group.