Interim report for the period 1 January - 31 March 2008

Summary
•	As expected, Danionics reported a loss for the first quarter of DKK 0.5
million before recognition of a DKK 2.5 million value adjustment in Danionics
Asia. 
•	The company reiterates its full-year forecast of a loss of DKK 2-3 million
before recognition of the share of the profit or loss or value adjustment in
Danionics Asia. 
•	As planned, Danionics contributed DKK 2.5 million to Danionics Asia in the
first quarter. For the full-year 2008, the capital contribution to Danionics
Asia is expected to amount to DKK 5-10 million. 

Q1 financial performance
As expected, Danionics reported a loss for the first quarter of DKK 0.5 million
before recognition of a DKK 2.5 million writedown of the loan capital to
Danionics Asia. The writedown equals the amount which Danionics contributed as
loan capital to Danionics Asia in the first quarter. Apart from the writedown,
the first-quarter financial performance was on a level with the results
achieved in Q1 2007, when Danionics reported a loss of DKK 0.4 million. 

The loan capital to Danionics Asia is recognised in the amount of DKK 0, as
against DKK 29.3 million at 31 March 2007. In connection with the presentation
of the annual report for 2007, the loan capital was written down to DKK 0. This
valuation was retained in Q1 2008, and the capital contribution during this
period has therefore been written down over the income statement. 

Equity amounted to DKK 20.5 million at the end of the quarter, down from DKK
23.5 million at 31 December 2007. The reduction in equity corresponds to the
net loss for the period. 

The joint venture  
The joint venture focused its efforts on developing customer relations with a
limited group of large customers. 

It is the intention that orders from two or three of these customers are to
form the foundation for commencing large-scale production during 2008. Over the
past few months, three of the customers have conducted audits of Danionics'
factory in Shenzhen. 

Often performed by third-party specialists, these audits are very demanding,
and the first two have been successfully completed. The third also showed that
the customer intends to continue its collaboration with Danionics, although the
final report will not be available until in a few weeks. 

Accordingly, the factory in Shenzhen has now reached a stage where customers
are prepared to commence business relations. The next step is to deliver trial
batteries to the customers. Danionics has incurred certain technical problems
with one of its trial batteries, and in the months ahead focus will be on
ensuring that the trial batteries are perfect before they are shipped to the
customers. Subsequently, they will undergo demanding test programmes by the
customers and, if they are approved, the customers will place orders with
Danionics. Realistically, large-scale production will not commence until in Q3
and Q4 of 2008. 

There is growing demand for lithium polymer batteries but also an
ever-increasing number of competitors offering this type of batteries. 

Most of the competition do not meet the same standards that Danionics aims for
and will most likely not be able to compete in terms of quality and working
conditions, but the presence of the competition is nevertheless an
inconvenience. 

Danionics Asia maintains the high standards confirmed by the approved audits
and hopes that this will help attract major customers for collaboration with
the company. 

Outlook for 2008
Danionics retains the forecast for 2008 presented in the annual report for 2007
released on 10 March 2008. The results for 2008 will be impacted by marketing
and sales costs concerning Danionics Asia and administrative expenses of
approximately DKK 2.5 million. As a result, the company expects an overall loss
in the region of DKK 2-3 million after interest income but before recognition
of the share of the profit, loss or value adjustment in Danionics Asia. 

Moreover, the company may generate commission income, should the sales efforts
undertaken by Danionics A/S result in the addition of new orders. 

The company expects to contribute additional operating capital to Danionics
Asia of approximately DKK 5-10 million in 2008. To date, the capital
contribution has run to DKK 2.5 million in 2008. 


For additional information, please contact:
Henning O. Jensen, Chief Executive Officer, tel. +45 70 23 81 30