SOURCE: EUROTECH S.p.A

August 10, 2007 06:14 ET

EUROTECH S.p.A : FIRST HALF YEAR 2007 REVENUES SURGE 50% OVER 2006 TO EUR 35.45 MILLION

AMARO, ITALY--(Marketwire - August 10, 2007) - PRESS RELEASE

EUROTECH: FIRST HALF YEAR 2007 REVENUES SURGE 50% OVER 2006 TO EUR 35.45 MILLION

Total consolidated revenues up 50% from EUR 23.65 million to EUR 35.45 million

Consolidated EBITDA up from EUR 1.676 million to EUR 882 thousand

Consolidated EBIT down from EUR 1.087 million to EUR -186 thousand

Consolidated result before income taxes down from EUR 699 million to EUR 573 thousand

Consolidated net financial position: positive at EUR 59.83 million

Amaro (UD), 10 August 2007.

Today the Board of Directors of Eurotech S.p.A. approved the results for the second quarter of 2007 and examined the figures for the first six months of the year.

Increased turnover for the Eurotech Group, a company active in the research, development, production and marketing of miniaturised computers (NanoPCs) and of computers featuring high-performance computing capability (HPCs).

+---------------------+-----------+--------------------+-----------------+
|Consolidated         |30/06/2006 |30/06/2006 NET OF   |30/06/2007 NET OF|
|Highlights           |           |PRICE ALLOCATION    |PRICE ALLOCATION |
+---------------------+-----------+--------------------+-----------------+
|(EUR '000)           |           |                    |                 |
+---------------------+-----------+--------------------+-----------------+
|SALES                |    23,650 |23,650              |35,454           |
+---------------------+-----------+--------------------+-----------------+
|EBITDA               |     1,194 |1,676               |882              |
+---------------------+-----------+--------------------+-----------------+
|EBIT                 |       230 |1,087               |(186)            |
+---------------------+-----------+--------------------+-----------------+
|FINANCIAL MANAGEMENT |     (388) |(388)               |759              |
+---------------------+-----------+--------------------+-----------------+
|RESULT BEFORE INCOME |     (158) |699                 |573              |
|TAXES                |           |                    |                 |
+---------------------+-----------+--------------------+-----------------+

+-------------------------+---------+--------------------+-----------+
|Consolidated Highlights  |         |Acquisition purchase|30/06/2007 |
|                         |         |price allocation (*)|           |
+-------------------------+---------+--------------------+-----------+
|(EUR '000)               |Change % |                    |           |
+-------------------------+---------+--------------------+-----------+
|SALES                    |   49.9% |-                   |    35,454 |
+-------------------------+---------+--------------------+-----------+
|EBITDA                   |  -47.4% |(200)               |       682 |
+-------------------------+---------+--------------------+-----------+
|EBIT                     | -117.1% |(1,270)             |   (1,456) |
+-------------------------+---------+--------------------+-----------+
|FINANCIAL MANAGEMENT     |  295.6% |-                   |       759 |
+-------------------------+---------+--------------------+-----------+
|RESULT BEFORE INCOME     |  -18.0% |(1,270)             |     (697) |
|TAXES                    |         |                    |           |
+-------------------------+---------+--------------------+-----------+
(*) Accounting effects of the Price Allocation relating to acquisitions made since April 2006 with reference to the Arcom Group and Applied Data Systems Inc.

GROUP RESULTS

Revenues increased from EUR 23.65 million in the first half of 2006 to EUR 35.45 million in the first half of 2007, posting growth of 50.0%, i.e. EUR 12.2 million. In the second quarter, revenue came to EUR 20.30 million, up by 21.3% with respect to the same period a year earlier.

During the half year in question, management pursued the plan for growth in size and internationalisation through the acquisition of Applied Data System Inc. which was executed on 8 January 2007.

Half-year figures show gross profit in absolute terms increasing by EUR 6.13 million, rising from EUR 11.84 million in the first half of 2006 to EUR 17.97 million in the first half of 2007. This meant that profit accounted for 50.1% of revenues in the first half of 2006 and 50.7% in the first half of 2007. This percentage is slightly higher than the expectations of management for 2007, showing the absence of any particular retail price pressure. In the second quarter, gross profit net of price allocation came to EUR 9.77 million (+19.1% year on year), with a 48.1% incidence on sales.

EBITDA amounted to EUR 882 million, net of EUR 200 thousand due to price allocation for the business combination - recognised in the accounts using the method laid down by IFRS 3 - involving purchase of the Arcom Group and Applied Data Systems Inc.. Fixed operating costs, due to the seasonality of the business, were a significant portion of revenue, since this tends to be lower in the first half of the year with respect to the second half of the year. The increase in sales expected in the coming quarters will make it possible to better absorb these fixed costs. In the second quarter, EBITDA net of the effects of price allocation amounted to EUR 1.44 million, accounting for 7.1% of sales.

EBIT, net of purchase price allocation, featured a decrease between the first half of 2006 and the first half of 2007, falling from EUR 1.087 million in 2006 to EUR -186 thousand in 2007. This trend was strictly related to the trend in EBITDA and to higher depreciation & amortisation posted in 2007. Net of purchase price allocation, second quarter 2007 EBIT amounted to EUR 732 thousand with a 3.6% incidence on sales, against EUR 1.233 million in second quarter 2006, also net of price allocation.

Financial management posted a positive change in absolute values of EUR 1.147 million between the first half of 2006 and the first half of 2007, due largely to the proceeds from the cash availabilities pursuant to the increase in capital at July 2006 and the positive effect of exchange rate differences.

Profit before tax fell from EUR 699 thousand in first half 2006 to EUR 573 thousand in first half 2007, net of price allocation. Net of purchase price allocation, second quarter 2007 pre-tax profit amounted to EUR 1.042 million with a 5.1% incidence on sales, against EUR 1.184 million in second quarter 2006, also net of price allocation.

Group net income improved from EUR -77 thousand in the first half of 2006 to EUR -44 thousand in the first half of 2007, net of price allocation. In addition to reflecting the trend in pre-tax performance, this result was mainly due to the tax burden of the Group's various companies and, to a lesser extent, minority interest. In the second quarter, Group net income came to EUR 460 million, up by 28.8% with respect to the same period a year earlier (net of price allocation)

After the acquisition in early 2007, the Group still showed a positive financial position of approximately EUR 60 million to use mainly toward external growth.

THE EUROTECH GROUP

Eurotech (ETH.MI) is a company active in the research, development, production and marketing of miniaturised computers (NanoPCs) and of computers featuring high-performance computing capability (HPCs).

EUROTECH SpA www.eurotech.com

Contacts:

Investor relations

Massimo Mauri

Tel. 0433-485435

E-mail: m.mauri@eurotech.com

Communication Department

Cristiana Della Zonca

Tel. 0433-485435

E-mail: c.dellazonca@eurotech.com

Press Office:

Community

Communication consulting

Marco Rubino

Tel. 02-89404231

E-mail: marco.rubino@communitygroup.it

ATTACHMENTS - FINANCIAL STATEMENTS

CONSOLIDATED INCOME STATEMENT

CONSOLIDATED INCOME STATEMENT - RECONCILIATION OF OPERATING AND REPORTED DATA

CONSOLIDATED BALANCE SHEET

NET FINANCIAL POSITION

NET WORKING CAPITAL

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