VISCOSE FIBERS BUSINESS TURNED PROFITABLE IN MAY

NEO INDUSTRIAL PLC       STOCK EXCHANGE RELEASE    13 June, 2011 at 12.10 pm

VISCOSE FIBERS BUSINESS TURNED PROFITABLE IN MAY

Neo Industrial’s Viscose Fibers business, namely Avilon Ltd, has turned profitable in May. In its interim report for the first quarter of 2011 on 5 May, 2011, Neo Industrial said it expected the Viscose Fibers business’ operating profit to be positive on the second half of the year.

Avilon’s operations, started in January 2011, turned profitable as the company introduced its in-house developed technology for converting paper grade pulp into a suitable material for viscose production. Having previously suffered from availability problems and high price of dissolving pulp, Avilon has in this way significantly lowered its production costs.

- I am sure that the business continues challenging due to the turbulent textile market and the slow fire retardant fiber market in the United States. However, Avilon’s raw material management and delivery accuracy are now in place, and the business has all the prerequisites for profitability, comments Neo Industrial’s Managing Director Markku E. Rentto.

Neo Industrial announces its second quarter earnings on 4 August, 2011.

Neo Industrial Plc

Markku E. Rentto
Managing Director

FURTHER INFORMATION:
Markku E. Rentto, Managing Director, Neo Industrial Plc,
tel. +358 020 7209 190

www.neoindustrial.fi

Neo Industrial Plc's strategy is to invest mainly in industrial companies with similar synergic benefits. The aim of investments is with active ownership to develop the purchased companies and establish additional value. Returns are sought through both dividend flow and an increase in value. Neo Industrial's B shares are listed on the NASDAQ OMX Helsinki Stock Exchange.

Neo Industrial’s business segments are Cable (Reka Cables, Expokabel, Nestor Cables), Viscose Fibers (Avilon) and Single Family Housing (Finndomo).