15th Dec 2008 07:00
December 15, 2008
Telit Communications Plc
"Telit" or "the Company"
Trading Update and Capital Increase
The Company announces that revenues for the first eleven months of 2008 are trending downwards and are currently standing at 22.8% above 2007 figures, compared to being 32% higher at the half year point. The downwards trend is due mainly to customers responding to the global economic slowdown by decreasing expenditure. As a result the Board believes that the Company's results for the year ending 31 December 2008 will be below market expectations for the financial year.
The Company is pleased to announce that the board of directors has approved the conversion of the €7 million credit line made available to Telit by the BAMES group into equity of Telit Wireless Solutions Srl. ("TWS"), as a result of Telit exceeding the minimum purchase commitment upon which the investment was conditioned. Following this investment BAMES will hold 10% of TWS' outstanding share capital. This completes the second and final instalment of the €16 million investment in the capital of TWS, previously announced on 14 March 2007, with updates provided in the Company's 2007 Interim Report, 2007 Annual Report and 2008 Interim Results and their accompanying announcements.
In response to the downturn in the economy Telit is adapting itself by rationalizing expenses and cutting costs while maintaining its main competences and infrastructure. As part of this cost saving plan, which is expected to generate a significant reduction in operating expenses, the Company's top executives and members of the board - in various countries including Italy, Germany, Israel, France, the U.S., Brazil and Korea - have agreed to a 10% decrease in their compensation during 2009. The Company remains committed to creating returns to shareholders and is confident in the long term viability of its business model.
Enquiries:
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Telit Communications Plc
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Tel 00 972 3 791 40 40
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Michael Galai, Finance director
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Maya Lustig, VP, Investor Relations
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Seymour Pierce Ltd
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Tel: 00 44 207 107 8000
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Stuart Lane/Christopher Wren
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www.seymourpierce.com
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