Nobel Biocare: Interim Report 2, January - June 2002

Gothenburg, SWEDEN


GOTHENBURG, Sweden, Aug. 14, 2002 (PRIMEZONE) -- Nobel Biocare Holding AG Group:


- Total sales increased by 11% (11% currency adjusted) to SEK 1 457.8 
  million. In Q2 2002, sales increased by 7% (11% currency adjusted)
  to SEK 728.9 million. Sales performance in Q2 was not impacted by any 
  price changes.

- Japan continued to experience positive sales trends. Notable 
  improvements were recorded in the second quarter in Germany,
  Belgium and the Netherlands.

- Operating income before non-recurring items increased by 39% to SEK 
  293.1 million, and Operating income by 13% to SEK 239.7 million. In
  Q2 2002, Operating income before non-recurring items increased by
  31% to SEK 149.5 million.

- The profitability improvement program increased the EBITA margin for 
  Dental Implants from 25.5% in the first quarter to 27.3% in the
  second quarter bringing the margin for the first half of 2002 to
  26.4%. The EBIT margin before non-recurring items for the Group 
  increased to 20.1%.

- Cash flow from current operations increased by 67% to SEK 348.6
  million reducing the net debt to SEK 13.1 million per 30 June 2002.

- Earnings per share increased by 17% to SEK 5.71, equivalent to
  CHF 0.92.

- A new Swiss holding structure was established following the
  successful share exchange offer. The shares of the new Swiss parent 
  company Nobel Biocare Holding AG were listed on the SWX Swiss
  Exchange and the Stockholm Stock Exchange on 24 June 2002.
  Nobel Biocare AB's shares were delisted from the Stockholm Stock 
  Exchange on July 18, 2002, when approximately 99% of the shares had
  been exchanged.


SEK M                                     Jan-June    Jan-June  Change  
                                               2002        2001
Net sales                                  1 457.8     1 309.2  +11.4%  
 of which Dental Implants                  1 272.9     1 146.8  +11.0%  
 of which Procera(R)                         184.9       162.4  +13.9%  
Operating income before non-recurring        293.1       211.4  +38.6%  
items
Operating income (EBIT)                      239.7       211.4  +13.3%  
Net income                                   143.5       123.5  +16.2%  
Cash flow from current operations            348.6       208.8  +67.0%  
Earnings per share, SEK                      5.71*      4.87**  +17.2%  
Earnings per share, CHF                      0.92*                      
Number of shares                            25 133      25 341          
                                               290*       224**
Number of shares after full dilution        26 357  26 617 318          
                                               605
 Market value 30 June                       14 643       9 300   

(*) Average number of Nobel Biocare Holding AG/Nobel Biocare AB shares.
(**) Average number of Nobel Biocare AB shares.

The Nobel Biocare Holding AG Group

Sales

Group

Total sales increased by 11.4% to SEK 1 457.8 million (11.1% currency adjusted). In the second quarter sales increased by 7.4% to SEK 728.9 million (10.5% currency adjusted). Sales performance in the second quarter was not impacted by any price changes.

Dental Implants

Sales increased by 11.0 % to SEK 1 272.9 million, (10.7% currency adjusted). In the second quarter 2002, sales increased by 6.9% to SEK 635.2 million (10.1% currency adjusted).

Dental Implants Regional Sales, January-June


SEK M                           2002           2001        Growth in SEK
                                                     (in local currency)
Europe                         558.0          495.9      12.5% / (11.1%)
North America                  476.8          426.4      11.8% / (10.3%)
Asia                           139.2          116.0      20.0% / (21.5%)
Rest of the World/Gore          98.9          108.5      -8.8% / (-0,8%)
Total                        1 272.9        1 146.8      11.0% / (10.7%)


Dental Implant Regional Sales, April-June    

SEK M                           2002           2001        Growth in SEK
                                                     (in local currency)
Europe                         280.0          246.7      13.5% / (13.0%)
North America                  237.2          222.0       6.8% / (11.0%)
Asia                            69.0           65.0        6.2% / (9.7%)
Rest of the                     49.0           60.4     -18.9% / (-8.9%)
World/Gore
Total                          635.2          594.1       6.9% / (10.1%)

Currency adjusted sales growth on the main markets, Europe and North America, increased in the second quarter compared to the first quarter of 2002.

The new sales strategy to target new customers with Replace Select resulted in significant growth for the brand and more than 1 000 new customers were recruited in the second quarter 2002. The Replace Select system is growing faster than the market due to its user-friendly and versatile approach, which attracts the growing General Practitioner segment of the market.

The success of Nobel Biocare's innovative new TiUnite implant surface continued. TiUnite represents 65% and 51% of Branemark System and Replace implant sales, respectively.

The clinical performance of the TiUnite surface has been shown to produce significant improvements in both implant survival and immediate function. Clinical studies of TiUnite performance for immediate function will be published in September 2002. In June, Nobel Biocare was the first company to receive a general FDA approval for immediate loading with the Replace HA coated implants.

Sales of Gore membranes are included in the Dental Implant business. The contribution from Gore membrane sales has been soft in the first half of 2002. The new bio-resorbable Gore membrane Resolut Adapt, which was launched in Q2 2002, was well received by the market and is expected to drive growth of this business.

Procera

Sales increased by 13.9 % to SEK 184.9 million, (12.7% currency adjusted). In the second quarter 2002, sales increased by 10.8% to SEK 93.7 million (13.2% currency adjusted).

Sales of Procera AllCeram and Procera Scanner showed steady growth trends. Scanner sales improved in the second quarter compared with the first quarter of 2002. Sales of personalized prosthetics for dental implants are growing as the Procera Abutment made of ceramic is gradually being launched. In the second quarter, the new 3D CAD design program was implemented world wide.

Operating results

Group

Operating income before goodwill amortization (EBITA) and non-recurring items increased by 41.4% to SEK 343.1 million (242.6).

Operating income before non-recurring items increased by 38.6% to SEK 293.1 million (211.4). Operating income (EBIT) increased by 13.4% to SEK 239.7 million (211.4). The operating margin (EBIT) increased to 16.4% (16.1%) and 20.1% (16.1%) before non-recurring items.

Operating expenses amounted to 49.6% (50.5%) of sales in the first half of 2002.

Goodwill amortization increased to SEK 50.1 million (31.2) mainly as a result of the Procera Sandvik AB acquisition in December 2001. Depreciation amounted to SEK 48.8 million (40.0).

The profitability improvement program, which was announced in October 2001 with the aim of improving the earnings level is developing above plan resulting in an EBITA margin for Dental Implants of 26.4% and an EBIT-margin before non-recurring items for the Group of 20.1%.


Operating Results, January-June
                                      2002       % of     2001      % of
SEK M                                           sales              sales
Operating income before goodwill                                        
amortization (EBITA) and non-
recurring items
Dental Implants                      336.4       26.4    239.2      20.9
Procera                                6.7        3.6      3.4       2.1
Total                                343.1       23.5    242.6      18.5

Operating income (EBIT) before non-                                     
recurring items
Dental Implants                      300.0       23.6    208.0      18.1
Procera                               -6.9       -3.7      3.4       2.1
Total                                293.1       20.1    211.4      16.1


Operating Results, April-June
                                      2002       % of     2001      % of
SEK M                                           sales              sales
Operating income before goodwill                                        
amortization (EBITA) and non-
recurring items
Dental Implants                      173.6       27.3    129.7      21.9
Procera                                0.4        0.4      0.4       0.4
Total                                174.0       23.9    130.1      19.2

Operating income (EBIT) before non-                                     
recurring items
Dental Implants                      156.0       24.6    114.0      19.2
Procera                               -6.5       -6.9      0.4       0.4
Total                                149.5       20.5    114.4      16.9

Non-recurring items of SEK -53.4 million, representing the majority of the consulting costs in relation to the establishment of the new Swiss holding structure, were recorded in the second quarter of 2002.

Dental Implants Operating income before goodwill amortization (EBITA) and non-recurring items increased by 40.6% to SEK 336.4 million (239.2). Operating income (EBIT) before non-recurring items increased by 44.2% to SEK 300.0 million (208.0).

The EBITA margin before non-recurring items improved to 26.4% (20.9%) as a result of the ongoing profitability improvement program with approximately 1.5% being allocated to purchasing and production efficiencies, 1% to sales efficiencies, and 2.5% to lower operating expenses.

Procera Operating income before goodwill amortization (EBITA) amounted to SEK 6.7 million (3.4). After goodwill amortization, operating income (EBIT) amounted to SEK -6.9 million (3.4).

The EBITA margin increased to 3.6% (2.1%).

The integration of Procera in the Nobel Biocare organization was successfully completed in the first half of 2002. A common market and sales organization for Dental Implants and Procera has been established on all markets as well as at Nobel Biocare headquarters.

Investments Capital expenditures on fixed assets totaled SEK 48.3 million (55.8), whereof SEK 30.9 million relates to investments in the production facilities.

Liquidity and financial position Mainly as a result of decreased working capital, cash flow from current operations increased by 67% to SEK 348.6 million reducing the net debt from SEK 272.0 million to SEK 13.1 million in the first half of 2002.

Liquid assets totaled SEK 271.4 million (31/12/2001: SEK 233.8 million).

Shareholders' equity per average share decreased to SEK 68.00* (31/12/2001: SEK 76.33**), due to paid dividend and negative translation adjustments mainly as a consequence of the weakened USD.

Parent company Since 21 June 2002, Nobel Biocare Holding AG, has been the parent company of the Nobel Biocare Group. The parent company income statement includes consulting costs in relation to the establishment of the new Swiss holding structure. The balance sheet includes the participation in Nobel Biocare AB as the main asset and the corresponding equity.

After the successful share exchange offer, the number of shares in Nobel Biocare Holding AG on 30/6/2002 totaled 24,005,242 (31/12/2001 for Nobel Biocare AB: 25,354,900).

Following the redemption of all the outstanding warrants and options, the total number of shares will be 26 357 605.

A new Swiss holding structure The initiative by the Nobel Biocare AB's Board of Directors to establish a new Swiss holding structure was made in order to support the company's continued efforts to increase profitability, sustain long-term market leadership and create value for the shareholders.

The establishment of the new Swiss holding structure was executed through a public share exchange offer to all the shareholders of Nobel Biocare AB involving a 1:1 exchange of shares in Nobel Biocare AB for shares in the new Swiss parent company, Nobel Biocare Holding AG. Following the successful completion of the exchange offer, with approximately 99% acceptance on 9 July 2002, Nobel Biocare AB is now a subsidiary of Nobel Biocare Holding AG.

The shares of the new Swiss parent company were listed at the SWX Swiss Exchange in Zurich and at Stockholmsborsen (the Stockholm Stock Exchange) on 24 June 2002.

The change in the legal structure does not change the operations of Nobel Biocare. All current operational headquarter functions, including the research department, will remain in Gothenburg, Sweden. The production centers in Sweden and the United States will not be affected by the new holding structure.

As a consequence of the new Swiss holding structure, Nobel Biocare reports its financial statements with footnote reconciliation between Swedish GAAP and IAS from Q2 2002. For the full year 2002, the financial statements for the Nobel Biocare Holding AG Group will be reported under IAS.

Status report on disputes As there are no material developments in the disputes earlier reported, nor any new disputes, Nobel Biocare has not changed its assessment of the potential outcome of the ongoing disputes.

Outlook for current year The outlook for the rest of 2002 should be viewed in relation to the company strategy established in October 2001. The priorities and objectives for 2002 can be summarized as follows:

Increasing the EBITA margin for Dental Implants from 21% (2001) to (greater than) 24% by the end of 2002 and the EBIT margin for the Group from 16% (2001) to (greater than) 20% in 2002.

Implementation of a new sales strategy targeting a new market segment, i.e. General Practitioners.

Preparation and launch of a new, integrated global market concept named Crown & Bridge & Implant, to drive long-term sales growth, which will be launched in Q4 2002 with the aim of transforming Nobel Biocare into a world leading company for Innovative Esthetic Dental Solutions.

The full impact of the strategic repositioning and integration of Procera within the Nobel Biocare organization.

14 August, 2002

NOBEL BIOCARE HOLDING AG

Heliane Canepa President & CEO


Futher information is available from:
Harrieth Sundaeus, Chief Financial Officer, tel. +46 31 81 88 48
Gunilla Ekholtz, Investor Relations Officer, tel. +46 31 81 88 36

The Interim Report 3 will be published 23 October 2002.

Nobel Biocare is an innovative, medical devices company, whose core business comprises dental implants and dental prosthetics. The company is the world leader in dental implants with its product systems Branemark System(R) and Replace(TM).

The company's other product line, Procera(R), is a unique, IT-based process for the industrial production of dental prosthetics. The system has been launched in more than 35 countries.

Nobel Biocare has around 1 300 employees and in 2001 sales totaled SEK 2 663 million. The company's headquarters are located in Gothenburg, Sweden, while production takes place in Sweden and the U.S.

Nobel Biocare has its own sales organizations in 27 countries. www.nobelbiocare.com

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