Elcoteq's Q2 Result Will be Weaker Than Forecast.

Business Editors

HELSINKI, Finland--(BUSINESS WIRE)--June 18, 2001

Electronic manufacturing services company Elcoteq Network Corporation's result for April-June will be weaker than first quarter result and therefore a clear loss.

Second-quarter net sales will be lower than net sales in the first quarter, which totaled 481 MEUR ($414,189,100). The deterioration in profitability between April and June is the result of weaker than expected demand, the costs arising from unused capacity and write-offs of non-current inventory.

The electronics sector expects growth toward the end of the year but EMS companies are currently experiencing shorter than normal forecasts and visibility of orders. Due to this low visibility, Elcoteq will review its forecast for the remainder of the year on August 3, when the company publishes its second-quarter interim report.

Elcoteq Network Corporation is the largest European electronics manufacturing services company and one of the global leaders in its field. Elcoteq provides engineering and manufacturing services, supply chain management and after-sales services to international high-tech companies. The company has three business areas, which are terminal products, communications network equipment and industrial electronics. Elcoteq has manufacturing services plants in Finland, Estonia, Russia, Hungary, Poland, Germany, Switzerland, Mexico and China, as well as customer service centers in Denmark, Switzerland, the USA, Japan and Hong Kong. Elcoteq's consolidated net sales in 2000 totaled over 2,200 MEUR and the company has 10,500 employees. Elcoteq Network Corporation was listed on the Helsinki Exchanges (ELQAV) in 1997. For more information on the company at www.elcoteq.com.