Precious Woods Holding Ltd.

euro adhoc: Precious Woods Holding AG, Zug
Annual Reports
Precious Woods continues to be successful in 2002 (E)

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Sales of timber products increased from 9,21 in 2001 to 9,76 million USD (+6%) in 2002. Net gain from the change in fair value of the plantations in Costa Rica increased from 2,12 million to 2,51 million USD in the same period. The operating profit of the group increased from 1,06 million USD to 2,47 million USD (+134%) and net profit increased from 1,45 to 2,16 million USD (+49%). Shareholders’ equity amounted to 84% of total capital in 2001 versus 88% in the prior year. Precious Woods created more than 300 new jobs in areas suffering from high unemployment. All details are discussed in the annual report which has been sent to shareholders and has been published in the internet at www.preciouswoods.com.

The impressive improvement of the operating results is primarily due to the higher gross margin, which increased from 1,11 to 2,51 million USD (+141%). This is a result of the ongoing initiatives to increase yield and productivity at all levels of the manufacturing processes. The devaluation of the Brazilian currency also contributed to lower manufacturing costs during the second half of the reporting period. The comparatively modest sales growth must be seen in the context of the prior year during which the gross sales volume grew by more than 80%. Operating cash flow decreased from +218 thousand USD to -897 thousand USD due to one-off increases in current assets such as inventories resulting from the expansion of manufacturing, a more complex supply chain and the acquisition of a veneer factory (formerly Carolina Industriá Ltda.).

The year 2003 has started off well. At Precious Woods Brazil, first quarter production, sales and cash flow are significantly higher than 2002 and within budgets for the long-term expansion of the group’s activities. In Costa Rica, teak plantations which had achieved only slower growth in the years 2000 and 2001, are now clearly recovering. Precious Woods Amazon took advantage of two excellent opportunities to significantly  expand the forest area. Overall, Precious Woods expects sales and profits to again increase in 2003.

Precious Woods was founded in 1990 in Costa Rica where more than 20 valuable species of trees, primarily teak, are planted to reforest abandoned pasture land. Since 1996 Precious Woods Amazon has pioneered the sustainable management of existing forests in Brazil. Sustainable management means that no more wood is harvested than naturally grows back in the harvest period. The forests are protected from clear cutting and slash and burn clearing. The local labour force is provided with permanent jobs. All Precious Woods business units are certified according to the standards of FSC (Forest Stewardship Council). The timber is processed in two saw mills and processing plants and marketed world wide.

end of announcement            euro adhoc 28.04.2003
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Further inquiry note: Kontakt: Precious Woods Holding AG, Zug Dr. Andres Gut, CEO Tel. 41 1 245 80 10 mailto: office@preciouswoods.ch

Branche: Forestry & Timber
ISIN:      CH0013283368
WKN:        982280
Index:    SPI
Börsen:  SWX Swiss Exchange / official dealing



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