OKMETIC INTERIM REPORT 1.1. - 31.3.2008

Okmetic is a technology company that supplies customised silicon wafers for the sensor and semiconductor industries and sells its technological expertise. During the period under review, the company's net sales amounted to 17.0 million euro (17.3 million euro). Profit for the period was 1.6 million euro (2.4 million euro).   REVIEW IN BRIEF   - Net sales amounted to 17.0 million euro (17.3 million euro). - Profit for the period amounted to 1.6 million euro (2.4 million euro). - The equity ratio strengthened, amounting to 57.4 percent (51.2%). - US dollar exchange rate developments and the cost of the main raw   material influenced the result and financial estimates. - Periodic revenue from technology sales caused significant variations   in the interim results. - Net sales for the first half of the year 2008 are expected to amount   to around 34 million euro and operating profit is expected to account   for around 12 percent of net sales.   KEY FIGURES   1,000 euro 1.1.- 1.1.- 1.1.- 1.1.- 1.1.- 31.3.08 31.3.07 31.12.07 31.12.06 31.12.05             Net sales 17,034 17,322 64,652 63,694 49,822 Operating profit           2,542 2,677 7,121 9,877 580    % of net               sales 14.9 15.5 11.0 15.5 1.2 Earnings per share, euro           0.10 0.14 0.31 0.41 -0.10 Net cash from operating           activities           2,281 1,628 8,305 17,945 3,125 Return on equity, %           14.2 23.5 12.4 18.6 -5.1 Net gearing ratio, %           15.2 30.5 19.6 31.3 99.5 Equity ratio, %           57.4 51.2 55.3 51.1 41.1 Average number of           personnel during the           period           355 360 362 360 359     PROJECTIONS FOR THE NEAR FUTURE   Okmetic supplies sensor wafers for a variety of applications. Demand for sensors is expected to grow by 12-16 percent this year (Yole, IC Insights). In addition to the traditional sensor segments, new micro-electromechanical sensor products are being introduced onto the market, the demand for which is anticipated to exceed the standard growth level of the industry.   Market growth within the semiconductor industry is expected to remain below ten percent this year (SIA, WSTS, Gartner, IC Insights).   According to the prevailing industry forecasts, the total volume of silicon wafer supplies is expected to grow by nearly ten percent in 2008. The growth will be most prominent in wafers with a 300 mm diameter. Market growth in relation to smaller wafer sizes is expected to be low and to be realised only in the latter part of the year. Demand for sensor wafers is expected to increase (IC Insights).   Net sales for the first half of 2008 are expected to amount to around 34 million euro and operating profit is expected to account for around 12 percent of net sales.   MARKETS   Growth within the sensor industry remained steady in the early part of the year. Demand for micro-mechanical sensors increased reasonably well. Semiconductor sales were comparable to the corresponding period in the previous year (SIA, WSTS).   The growth in the demand for silicon wafers has mostly affected large, 300 mm wafer sizes. Demand for smaller, 100-200 mm semiconductor wafers, which are important for Okmetic, fell slightly below the levels of the corresponding period in the previous year, according to the prevailing market forecasts.    SALES   The group's net sales amounted to 17.0 million euro (17.3 million euro).   Net sales per customer segment       2008 (2007) from beginning of year (on average) Sensors 34% (34%) Semiconductors 43% (56%) Technology    23% (10%)   Technology sales, in addition to our own expert manufacturing services, also include crystal sales. The fact that revenues from manufacturing expertise sales are recorded in periodic instalments, and also the fluctuations with respect to the volume of crystal sales, cause clear variations in the percentage of net sales per customer group and market area during each quarter.   Sales by Okmetic to the sensor market increased and developed on target. Sensor wafers are used in the automotive, aviation and medical industries, for example, as well as in consumer applications. As a sensor wafer supplier, Okmetic is the global market leader.   Sales of semiconductor wafers decreased slightly. Typically, semiconductor wafers are used in consumer electronics, telecommunications and automotive applications. Demand for semiconductor wafers experienced a decline in the early part of the year. The position is expected to improve in the latter half of the year.   Net sales per market area     2008 (2007) from beginning of year (on average) North America 40% (48 %) Europe 42% (32 %) Asia 18% (20 %)   Fluctuations in the principal invoice currency of each operating area had a significant effect on the various market area segments.   PROFIT   Okmetic group's profit for the period was 1.6 million euro (2.4 million euro). Earnings per share amounted to 0.10 euro (0.14 euro).   The fact that revenues from technology sales are recorded in periodic instalments caused significant variations in the interim results.   FINANCE AND INVESTMENT   The group's financial situation is good. Its net cash flow from operating activities amounted to 2.3 million euro (1.6 million euro). The value added tax liabilities and receivables resulting from an internal business acquisition that was concluded in Finland at the turn of the year have been paid.   The group's investment costs amounted to 0.3 million euro.   At the end of the financial period, cash and cash equivalents amounted to 15.1 million euro (13.8 million euro). Return on equity amounted to 14.2 percent (23.5%). The group's equity ratio strengthened, amounting to 57.4 percent (51.2%). Shareholders' equity per share amounted to 2.76 euro (2.49 euro).   PRODUCT DEVELOPMENT   Product development accounted for 3.0 percent (2.7%) of the net sales of Okmetic.   PERSONNEL   The number of employees at Okmetic averaged 355 (360) of whom, at the end of the financial period, 310 were located in Finland, 46 in the USA and three in Japan. OPERATIONAL RISKS   The majority of Okmetic's sales are concluded in US dollars, and a relatively small proportion in Japanese yen. The US dollar has fallen significantly since the start of the year. Despite hedging, the company remains vulnerable to exchange rate fluctuations.   The demand for polycrystalline silicon, the principal raw material of silicon wafers, has exceeded supply since 2006, thereby reducing its availability and increasing the cost. The company anticipates that, throughout 2008, this availability will continue at a low level, and the price will remain high. The company has secured access to the raw material through long-term purchase agreements.   The semiconductor market operates in cycles. This cyclical effect is currently at a low, and the demand for semiconductors is reduced. Demand is anticipated to increase towards the end of the year.  Technology sales, due to the sales structure, vary significantly during different periods. SHARE PRICE DEVELOPMENT AND TRADING   A total of 2.2 million shares (3.2 million shares) were traded in the period 1.1. - 31.3.2008, representing 12.8 percent (18.9%) of the total shares of 16.9 million. The lowest quotation of the period was 2.20 euro (3.34 euro) and the highest was 3.14 euro per share (4.38 euro), with an average of 2.63 euro (3.88 euro). The closing quotation for the period was 2.48 euro (3.85 euro). The total market value of the share capital amounted to 41.9 million euro (65.0 million euro) at the end of the financial period.     OWN SHARES   The company has not redeemed its own shares and the board of directors has not been authorised to redeem or surrender the company's own shares.   OPTIONS   The company has not issued any option rights.   AUTHORITY OF THE BOARD OF DIRECTORS TO INCREASE SHARE CAPITAL   The annual general meeting held on 3.4.2008 authorised the board of directors to decide on share issue, share option rights or any other share entitlement pursuant to paragraph 1(10) of the Finnish Companies Act. The aggregate number of shares issued on the basis of the authorisation may not exceed 3,377,500 shares, which represents approximately 20 percent of the total number of shares of the company. The board of directors is authorised to decide upon any terms and conditions concerning the issue of shares or share options or any other share entitlement. The issue of shares or option rights or any other share entitlement may be effected as a directed issue. The authorisation will be effective until the following annual general meeting of shareholders.   RESOLUTIONS OF THE ANNUAL GENERAL MEETING OF OKMETIC OYJ AND ORGANISATION OF THE BOARD OF DIRECTORS   The annual general meeting of Okmetic Oyj, held on 3.4.2008, ratified the corporate accounts for 2007, and indemnified the board of directors and the managing director of the company in that respect. It was decided to distribute a dividend of 0.10 euro per share for the year 2007. The dividend was paid on Thursday, 17.4.2008. Further, the annual general meeting carried the proposal by the board of directors for the share issue authority to be granted to the board of directors.   The board of directors will consist of five members. The following were re-elected as board members until the end of the next annual general meeting: Mikko J. Aro, Karri Kaitue and Pekka Salmi. The managing director of Outotec Oyj, Tapani Järvinen, and the managing director of Tecnomen Oyj, Jarmo Niemi, were appointed as new members. At the organisational meeting held immediately following the annual general meeting, the board of directors appointed Mikko J. Aro as chairman, and Karri Kaitue as deputy chairman. At the annual general meeting, the current annual fees payable to the board members for their appointment period were confirmed as follows: chairman 34,800 euro, deputy chairman 26,100 euro and other members 17,400 euro.   Authorised Public Accountants PricewaterhouseCoopers Oy were appointed as auditors, with the principal auditor being Markku Marjomaa, Authorised Public Accountant. Payment to auditors will be effected in accordance with their invoice.   The proposal by the board of directors to authorise the board of directors to increase share capital as set out above was ratified at the annual general meeting.   Vantaa, 29.4.2008   Board of directors   For further information, please contact:   President Antti Rasilo, Okmetic Oyj, tel. +358 40 746 1351, email: antti.rasilo@okmetic.com   Senior Vice President Esko Sipilä, Okmetic Oyj, tel. +358 9 5028 0286, email: esko.sipila@okmetic.com   Distribution:   OMX Nordic Exchange Principal media www.okmetic.com     OKMETIC IN BRIEF   Take it higher   Okmetic is a technology company which supplies tailor-made silicon wafers for sensor and semiconductor industries and sells its technological expertise. Okmetic provides its customers with solutions that boost their competitiveness and profitability.   Okmetic's silicon wafers are part of a further processing chain that produces end products that improve human interaction and quality of life. Okmetic's products are based on high-tech expertise that generates added value for customers, innovative product development and an extremely efficient production process.    Okmetic has a global customer base and sales network, production plants in Finland and the US and contract manufacturers in Japan and China.   Okmetic's shares are listed on OMX's Nordic Stock Exchange under the code OKM1V. For more information on the company, please visit our website at www.okmetic.com.