Tilgin Interim report 1 January - 31 March 2008

Tilgin Interim report 1 January - 31 March 2008

First quarter 2008
•	Net sales SEK 31.3 million (128.6)
•	Net result SEK -31.4 million (1.1), of which write-downs on inventory
negatively affected the result by SEK -1.2 million (-1.6)
•	Result per share SEK -1.41 (0.05) before dilution
•	Order intake SEK 66.6 million (77.3) and order backlog as of 31 March 2008 SEK
66.4 million (43.4)
•	Gross margin 37 % (26 %)
•	Operating result SEK -31.5 million (2.1)
•	Cash flow from operating activities SEK 1.2 million (25.6)
•	Cash and bank SEK 13.7 million (67.8) as of 31 March 2008


”As expected the company had a rough start in 2008 with significantly lower
sales. However, improved order intake and stronger gross margins create
conditions for a stronger long-term development.”


Net sales went down in the first quarter compared with the fourth quarter 2007
and also compared with the corre¬sponding period last year. This was an expected
development that was announced in the 2007 year-end report. Order intake and
order backlog increased compared with the previous quarter, in particular in the
IP residential gateway segment. 

The decrease in net sales is in large part explained by the company's loss of
its largest customer in the IPTV segment (Belgacom) during the fourth quarter
2007. In 2007, this customer contributed with more than half of the company's
net sales and with almost 90 per cent of the IPTV segment net sales.

IP residential gateway, Tilgin's other business segment, showed net sales of SEK
25.5 million, which is a decrease of 18 per cent since the fourth quarter 2007.
The decrease is mainly due to longer lead times for sourcing a certain component
from one of our subcontractors. This has brought delays to deliveries as well as
to invoicing. 

To ensure future growth and profitability the company has taken a series of
cost-saving financial and operating measures. The planned cost savings are
progressing according to plan and are expected to reach full effect during the
second half of 2008 with savings of at least SEK 7 million per quarter. The
pending fully guaranteed share issue will provide the company with SEK 72
million before issue and guarantee expenses. The company has also taken a number
of steps to broaden its customer base and to increase profitability in its
current projects.

The efforts in sales resulted in the gross margin reaching a new all-time high,
as well as an increase in order intake and order backlog during the first
quarter. Order intake in IP residential gateway in particular was very
satisfactory with increasing volumes from several customers. The company has
also taken measures to ensure deliveries of critical components. In order to
broaden the customer base and increasing sales in IPTV, the company is
cooperating with Ericsson and Nokia Siemens Networks. We are expecting this to
generate new business already during the second quarter. Furthermore, since
March 2008 the company is working together with a major Nordic operator with a
pilot installation of the new IPTV product platform supporting HDTV and PVR.

There are favourable conditions for the company to once more create growth and
profitability. In light of the company's efforts and the improved order intake
and gross margin, net sales is expected to recover during the second half of
2008, and the operating result for the year as a whole is expected to improve
compared with 2007.

Ola Berglund, CEO

― End ―

This press release has been reported to the Swedish Financial Supervisory
Authority subject to FFFS 2007:11. In its capacity as issuer, Tilgin AB is
releasing the information in this press release in accordance with the Swedish
Securities Exchange Act. The information was distributed to the media for
publication at 7 a.m on April 18th 2008.


Phone conference:
In view of the interim report, the capital market is invited to a conference
call on Friday 18 April. The conference will start at 09:00 CET. Participants
may follow the conference via Internet, website www.tilgin.com/q108, or access
it by dialing +46 (0)8 5052 0110. A presentation is held available at the
company's web site (www.tilgin.com) when the phone conference starts.

For further information, please contact:
•	Ola Berglund, CEO Tilgin AB (publ), Phone: +46 739 61 86 03, E-mail: 
ola.berglund@tilgin.com 
•	Mikael Sköld, CFO Tilgin AB (publ), Phone: +46 708 48 30 11, E-mail: 
mikael.skold@tilgin.com


About Tilgin 
Tilgin designs and delivers operator managed intelligent service node products
and solutions that service-connect the broadband home. Supporting the full
convergence of voice, video and data, Tilgin takes a network systems approach to
customer premises equipment (CPE) that enables providers to offer a broad
portfolio of personalized and differentiated next-generation broadband services.
Tilgin's comprehensive product portfolio of Telco Home Gateways, Advanced IP
Media Terminals and Service Node Management solutions, offer service providers
unprecedented return on investment - delivering new service revenues with
substantial cost savings over the lifetime of the product. Tilgin was founded in
1997 under the name i3 micro technology and is listed on the Stockholm Stock
Exchange, Nordic List. It is headquartered in Kista, Sweden, with sales offices
in France and Germany. www.tilgin.com