Cardo AB: Interim Report, January - March 2000.

    Business Editors/High-Tech Writers

      STOCKHOLM--(BUSINESS WIRE)--May 16, 2000--

    -   Invoiced sales totaled SEK 2,214 million (2,117), a rise of 5
        percent after adjustment for the effects of exchange rate
        movements and company acquisitions/disposals.

    -   Operating earnings rose by 35 percent to SEK 107 million (79).

    -   Earnings after financial items and minority share rose from
        SEK 52 million to SEK 81 million.

    -   Earnings per share after full tax rose to SEK 1.96 (1.27).

    -   Cash flow from operations after tax rose to SEK 7.60 (1.13)
        per share.

      The Group's inflow of orders amounted to SEK 2,357 million (2,272)
during the period, which is a rise of 5 percent for the current
structure of the Group after adjustment for the effects of exchange
rate movements.
      Invoiced sales rose to SEK 2,214 million (2,117). Adjusted for the
effects of exchange rate movements, this is a rise of 7 percent.
Company acquisitions/disposals account for 2 percentage points of this
figure.
      Operating earnings rose by 35 percent to SEK 107 million (79),
providing an operating margin of 4.8 percent (3.7). Cardo Door and
Cardo Rail improved their operating earnings, and Cardo Pump's were on
a par with last year. Earnings after financial items rose to SEK 83
million (54), providing a profit margin of 3.8 percent (2.5).
      Earnings after financial items and minority share rose to SEK 81
million (52). Earnings per share after full tax were SEK 1.96 (1.27).
      Exchange rate movements are estimated to have had only a marginal
impact on Group earnings.
      Return on capital employed was 19.3 percent (18.9) for the
twelve-month period ended March 31. Return on equity during the same
period amounted to 22.0 percent (19.9).
      Cash flow from operations after tax improved to SEK 7.60 (1.13)
per share.

Invoiced sales and earnings by business area

                     Invoiced sales                  Earnings
               January-March  Whole year    January-March   Whole year
MSEK            2000    1999    1999         2000   1999      1999
---------------------------------------------------------------------
Cardo Door     1,021     916   4,227           47     35       430
Cardo Pump       571     538   2,465           37     37       247
Cardo Rail       622     636   2,675           43     18       170
Other items(1)     -      27     122          -20    -11       -64
---------------------------------------------------------------------
               2,214   2,117   9,489          107     79       783
Financial items                               -24    -25       -88
---------------------------------------------------------------------
Earnings after financial items                 83     54       695
Minority share in earnings after
 financial items to be deducted                -2     -2       -21
---------------------------------------------------------------------
Earnings after financial items and
 minority share                                81     52       674
---------------------------------------------------------------------
(1) Made up of the parent company, other central units and Group
    adjustments.
    Invoiced sales during 1999 relate to Tebel and Group adjustments.
*T

      Cardo Door

      Cardo Door is one of the world's largest manufacturers of
industrial doors and Europe's leading supplier of dock loading
equipment. Cardo Door is also the market leader in the service of
these products and one of Europe's largest manufacturers of
residential garage doors. Its biggest brand names for industrial doors
and dock loading systems are Crawford, Clever and Hafa, and for
industrial doors alone Faltec, Alsta and Allhabo. Residential garage
doors are marketed under the brand names Normstahl, Crawford, Car-In
and Henderson.
      February saw the acquisition of the UK's leading manufacturer of
residential garage doors, P C Henderson. Henderson is included in
Cardo Door's invoicing and earnings as of the time of acquisition.
Henderson, which has a turnover of approximately SEK 325 million and
employs about 325 people, enjoys good profitability. In 1999,
Henderson's earnings after financial items amounted to SEK 32 million.
The purchase price of the shares was SEK 136 million, and goodwill as
a result of the transaction is preliminarily estimated at slightly
more than SEK 83 million. This acquisition, which is part of Cardo
Door's strategy for continued growth in the residential garage door
segment, further strengthens Cardo Door's position as the third
largest supplier of residential garage doors in the European market.
Following the acquisition, Cardo Door's previous garage door
operations in the UK have been transferred to Henderson.
      The focus on dock loading systems, residential garage doors and
service in recent years has meant that the proportion of Cardo Door's
invoicing represented by industrial doors has gradually decreased and
with it the business area's dependence on industrial new construction.
Of Cardo Door's turnover, industrial doors today account for slightly
less than 40 percent, dock loading systems for just under 15 percent
and residential garage doors and service for roughly a quarter each.
      Cardo Door's invoiced sales rose during the period to SEK 1,021
million (916). Adjusted for the effects of exchange rate movements and
company acquisitions, this represents a rise of 9 percent. Operating
earnings rose to SEK 47 million (35).
      For industrial doors, demand rose in a number of European markets.
After a previous declining trend in Germany, demand has stabilized
since the end of 1999. Demand for dock loading equipment was on a par
with last year, while demand rose for residential garage doors and
service.
      A number of major orders were received during the period. In
Italy, 212 industrial doors and 88 dock levelers were sold for
installation in a logistics center as well as 27 dock loading systems
for a freight terminal. A big service contract was also received in
Italy relating to the transport company ATAC Roma's maintenance
workshop in Rome. In Turkey, 6 big Megadoor doors were ordered for a
steel works, 45 industrial doors for Ford's plant in Golcuk and 80
industrial doors for installation at an airport in Kurtkoy. There was
a sale of 192 complete dock loading systems for a distribution center
in the UK, and in Spain an order was received for 56 dock loading
units and 59 industrial doors for a distribution center in the Basque
Provinces. The service company Itevelesa ordered 150 industrial doors
for installation in 27 repair plants in central and northern Spain.

      Cardo Pump

      Cardo Pump is one of Europe's largest manufacturers of centrifugal
pumps, mixers and aerators for use in water and wastewater treatment
plants, process industries and the construction sector. Cardo Pump is
also a global leader in the production of sophisticated measuring
instruments for the pulp and paper industry. Its products are marketed
under the brand names ABS, Pumpex and Lorentzen & Wettre.
      The beginning of the year saw the acquisition of the operations of
the American company CH&E, which has a turnover of approximately SEK
60 million and employs about 40 people. CH&E makes diesel-driven
dewatering pumps that complement Cardo Pump's electrically driven
pumps. Diesel- driven pumps are often used in the USA, since
construction sites there do not always enjoy access to electricity in
the initial phase. CH&E has been integrated with Cardo Pump's
operations in the USA.
      Invoiced sales amounted to SEK 571 million (538), which is a rise
of 3 percent after adjustment for the effects of exchange rate
movements and company acquisitions. Operating earnings amounted to SEK
37 million (37).
      Deliveries to Cardo Pump's biggest segment, water supply and
wastewater, rose while deliveries to the pulp and paper industry and
to the heating, ventilation and sanitation field decreased somewhat
compared to the corresponding period last year.
      A number of significant orders were received during the period,
including one for 32 units of a newly developed flow booster for
installation in Moscow. The flow booster is used to transport large
volumes of water in tanks in connection with the treatment of
wastewater. Gothenburg's water supply and wastewater works continued
to modernize its pump stations and ordered a number of big submersible
pumps. In partnership with Kvaerner Pumps, an order was received from
the Gruvon paper mill in Sweden for process and vacuum pumps.
      The expansion of the treatment plant in Tallinn has continued with
Cardo Pump as the main supplier of pumps and mixers. During the first
quarter, the biggest submersible pumps ever built for pumping polluted
water were delivered to Tallinn. These are equipped with 710 kW motors
and weigh 10 tonnes each.

      Cardo Rail

      Cardo Rail, which markets its products mainly under the SAB WABCO
trademark, is one of the world's largest manufacturers of brake
systems and brake components for rail vehicles. Cardo Rail is a wholly
owned business area in Cardo as of the turn of the year 1999/2000.
      The inflow of orders during the period amounted to SEK 613
million, which is on a par with last year for a comparable structure
and adjusted for the effects of exchange rate movements. Orders
received during the period included two important ones from
Siemens/Krauss Maffei in Germany relating to bogie-brake equipment and
complete brake systems for locomotives for OBB, the Austrian state
railway company. These orders, with a total value of SEK 100 million,
are of great significance to Cardo Rail's task of strengthening its
position as a complete supplier of brake systems in the big and
important German market.
      Cardo Rail's invoiced sales amounted to SEK 622 million (636),
which adjusted for the effects of exchange rate movements is on a par
with last year. Operating earnings rose to SEK 43 million (18). The
improvement is mainly a result of reduced costs as a consequence of
the restructuring process, which is gradually achieving full effect.

      Liquidity and financing

      At March 31, the Group's liquid assets stood at SEK 237 million
(368) compared with SEK 325 million at the beginning of the year. In
addition, there are unutilized credit facilities of approximately SEK
2.3 billion (2.9).
      Cash flow from operations was SEK 228 million (34) after tax,
which is equivalent to SEK 7.60 (1.13) per share. Adjusted for the
effects of exchange rate movements on the change in working capital,
cash flow was SEK 6.68 (-0.80) per share. The Group's gross
investments, excluding company acquisitions, stood at SEK 77 million
(42).
      Net interest bearing debt at March 31 amounted to SEK 1,463
million (1,538) compared with SEK 1,332 million at the beginning of
the year. The increase is a consequence of company acquisitions.
      Equity amounted to SEK 2,617 million (2,364), which is equivalent
to SEK 87.24 (78.82) per share.
      The Group's equity ratio at March 31 was 38.9 percent (36.5).

      Cardo's share of SPP's surplus funds

      In 1999, the life and pension insurance group SPP announced that
it had allocated SEK 73.6 million of its surplus funds to the Group,
of which SEK 5.6 million is for the parent company. Detailed
information on the body of regulations concerning the utilization of
these surplus funds will be received in mid-June. Since the Group
discharged its PRI (Pension Registration Institute) liabilities in
cash in 1999 in the sum of approximately SEK 200 million, it is
expected that all the surplus funds can be received in cash this year.
The surplus funds were not reported as assets in the balance sheet at
March 31 2000.

      Personnel

      The number of employees in the Group at March 31 was 7,628
(7,364).

      The parent company

      The parent company's earnings after financial items amounted to
SEK -17 million (166), its gross investments to SEK 0 million (0) and
its liquid assets to SEK 3 million (6) as against SEK 3 million at the
beginning of the year.

      C15 growth program

      With a view to generating greater growth for the Group in the
future, an extensive program was started at the end of 1999 under the
designation C15. C15, which stands for the Groupwide target "15
percent annual profitable growth in sales", involves a sharper focus
on organic growth. This sharper focus on organic growth implies no
change in the Group's acquisition strategy. Company acquisitions will
continue to account for a significant part of growth. The measures and
investments to increase organic growth primarily consist of increased
marketing activities and a considerable expansion in service and the
aftermarket. The effect of the measures and investments on earnings is
expected to be limited during the course of this year and gradually
increase as of 2001.

      Market prospects

      The business cycle for industrial construction in Europe shows
signs of an upturn. An improved market situation and a rise in sales
volume are therefore expected for Cardo Door during the year. For
Cardo Pump's biggest segment, water supply and wastewater, a positive
trend is expected in the long term. The improved economic climate for
the pulp and paper industry has yet to lead to increased demand for
pump equipment. Even if the rail market is growing in the long term,
sales volume is foreseen as declining to some extent during the year.
The restructuring measures carried through will lead to further
improvement in earnings and an improved operating margin for Cardo
Rail.

Malmo, Sweden, May 16 2000

Cardo AB (publ)

Kjell Svensson
President and CEO

      This report has not been subjected to special examination by the
Company's auditors.

      Cardo's interim report for January-June will be published on
August 16 2000.
*T
Enclosed: 1. Consolidated income statement and balance sheet in brief
          2. Consolidated cash flow statement in brief
          3. Invoiced sales and earnings by business area
          4. Group financial summary
          5. Consolidated income statement and balance sheet in brief
             translated into euros
*T
      For further information, please contact:

Kjell Svensson, President and CEO,
phone [phone]

Sven-Erik Persson, Executive Vice President,
phone [phone]

Christer Roskvist, Head of Public Relations,
phone [phone]

      Cardo is an international engineering group with a turnover of SEK
9.5 billion in 1999. Cardo holds a strong position in the markets for
doors, pumps and rail-vehicle brake systems. Cardo has subsidiaries in
about 30 countries with the focal point resting in western Europe, and
roughly 7,700 employees.

-0-

      Please visit http://www.bit.se for further information The
following files are available for download:

http://www.bit.se/bitonline/2000/05/16/20000516BIT00610/bit0001.doc
The full report
http://www.bit.se/bitonline/2000/05/16/20000516BIT00610/bit0002.pdf
The full report
http://www.bit.se/bitonline/2000/05/16/20000516BIT00610/bit0003.xls
Tables

    --30--rr/cgo*

    CONTACT: Cardo AB
             Kjell Svensson, [phone], [phone]
              or
             Sven-Erik Persson, [phone], [phone]
              or
             Christer Roskvist,  [phone], [phone]

    KEYWORD: INTERNATIONAL EUROPE
    INDUSTRY KEYWORD: MANUFACTURING BUILDING/CONSTRUCTION EARNINGS