YEAR-END RELEASE, 2010

YEAR-END RELEASE, 2010

INTERIM REPORT OCTOBER-DECEMBER, 2010

Improved cash flow despite continued weak growth in Central Europe

Fourth quarter

  · Net turnover declined by 12% in relation to the same period and
amounted to SKr 270.3 million (306.4), SKr 23 million of which was
attributable to currency effects. The remainder of the decrease is
attributable to contracting activities, which saw a decline in volumes
in relation to 2009 as a result of the early winter in Europe.

  · The operating result was a loss of SKr 51.9 million (loss 55.2).

  · The operating cash flow, i.e. the cash flow before financing
activities, amounted to SKr 137.9 million (119.5).

  · The result after tax was a loss of SKr 85.0 million (loss 55.1).

  · The loss per share was SKr 5.04 (loss 5.14).

January-December

  · Net turnover decreased by 10% in relation to the previous year and
amounted to SKr 1,293.9 million (1,435.0). As a result of the stronger
Swedish krona turnover declined by SKr 100 million upon the translation
of sales in foreign currencies into Swedish kronor. The remainder of the
decrease is mainly due to weak contracting markets in Central Europe.

  · The operating result was a loss of SKr 60.7 million (loss 40.0). The
decrease is attributable to higher raw material prices and lower volumes
in Central Europe.

  · The operating cash flow amounted to SKr 40.6 million (57.8).

  · The consolidated result after tax amounted to a loss of SKr 101.3
million (loss 57.0).

  · The loss per share for 2010 was SKr 7.08 (loss 5.55).

Dividend

  · The Board proposes to the AGM that no dividend be paid for the 2010
financial year.

Comments by Stefan Tilk, CEO and Managing Director
After I took over as CEO in September Geveko estimated that the
operating result would be about the same as in 2009, or lower. The
operating result reported for 2010 was a loss of SKr 60.7 million (loss
40.0), which is clearly unsatisfactory. Several factors had an effect on
our ability to improve profitability. The unsettled financial conditions
involving public finance problems in countries in Central Europe which
was accompanied by cuts in spending on road infrastructure, an uncertain
situation on commodities markets with significant shortages that
resulted in price increases, the early winter in the Nordic region, and
severe flooding in Europe were all factors behind the loss incurred. The
markets in Central Europe were characterised by a steep decline in both
volume and result. The businesses in Poland, Slovakia, the Czech
Republic and Romania were also affected in 2010 by the huge budget
deficits in these countries and the accompanying cutbacks in the road
industry. The British government was also forced to decide on an
austerity programme, which further increased the pressure on a British
market that was already exposed to intense competition. On the other
hand, developments on the contracting market in the Nordic region were
satisfactory. Sweden, Norway, Denmark and Finland all decided to
increase their budgets for road maintenance, which stimulated the demand
for Geveko's products. The Material Sales business area noted robust
volume growth in the Nordic region and Western Europe and reported
modest growth for its Premark® product area.

In 2010 efforts focused on co-ordinating the Group's contracting units
in order to take advantage of operational synergies. Geveko has also
lowered its cost base in preparation for the continued unstable market
conditions, but the effects on the result of the action plan implemented
in 2010 were, unfortunately, curtailed by the sharp increases in the
prices of raw materials with limited scope to pass these on to
customers. 2011 will be a year of many challenges. The conditions for a
recovery on the contracting markets in Central Europe are dependent on
the state of these countries' finances and what opportunity they have in
2011 to resume spending on the road infrastructure. There is a pressing
need for infrastructural improvements in these countries and the hope is
that it will be possible to implement some of them in 2011. However the
likelihood of the market situation in Central Europe improving during
the year is considered to be slight.

With its business- and market-orientated organisational structure, and
as one of the few players active at all points along the value chain,
the company will continue to focus on marketing activities and product
development. In the Material Sales business area we have a
well-established sales organisation that also serves as a distribution
channel on new markets and creates openings for organic growth. When it
comes to the Contracting business, I can foresee a more favourable year
ahead in the Nordic region thanks to the highly integrated organisation.
We shall continue our efforts to strengthen the co-ordination between
the contracting units in Central Europe.

The contracting markets that are expected to show a stable pattern in
2011 are the Nordic region and Hungary. In the Material Sales business
area there are good prospects for healthy growth in the Premark® and
2-component material product areas. Sharp increases in raw material
prices may, however, reduce the demand for thermoplastic products. In
Intelligent Road Markings, our new business area, we see opportunities
for higher sales and we can also note that demand is increasing for the
traffic engineering products being developed and marketed by the
Hungarian business.

Geveko is well placed to build on its experience in road markings and to
be an active partner in road safety activities in Europe. Despite
negative profitability and market conditions that will probably persist
in 2011, as the newly appointed CEO I have a positive view regarding our
future prospects.

Contact information:
Stefan Tilk, CEO and Managing Director
Tel: +46 (0) 31 172945, +46 (0) 702 499419
Stefan.tilk@geveko.se (Stefan.tilk@geveko.se)
Göran Eklund, CFO
Tel: +46 (0) 31 172945, +46 (0) 727 325054
Goran.eklund@geveko.se (Goran.eklund@geveko.se)

Address:
AB Geveko (publ)
Company registration number: 556024-6844
P.O. Box 2137
403 13 Göteborg, Sweden
Tel: +46 (0) 31 172945
Fax: +46 (0) 31 7118866
info@geveko.se (info@geveko.se)

The information AB Geveko releases in this interim report is such that
shall be published in accordance with the Act concerning the Securities
Market and/or the Act concerning Trading in Financial Instruments. This
information was released for publication on 23 February 2011 at 12.30
p.m.