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Results Ahead of Expectations at all Levels; Market Leading Positions Maintained; Strengthened Financial Position; Positive Outlook

Filtronic plc (“Filtronic”), a world leader in the design and manufacture of customised microwave electronic products for the wireless telecommunications and defence industries, announces its Interim Results for the six months ended 30 November 2003. Sites are in the UK (North of England, Yorkshire, Midlands, Scotland), the US, Finland, China and Australia.

Financial Highlights

• Group sales of £121.5m (2002: £123.9m).
• Operating Profit of £4.7m (2002: £1.4m).
• Pre-tax profits of £2.2m (2002: £0.0m).
• Earnings per share of 0.97p (2002: 1.99p loss).
• Interim dividend maintained at 0.90p (2002: 0.90p), payable 1 April 2004.
• Successful debt refinancing - estimated annual saving of £1.5m.
• Net gearing down to 51% (2002: 73%).

Operational Highlights

• Wireless Infrastructure
  - Sales similar to those of second half of previous year.
  - Maintained leading market position.
• Handset Products
  - Mobile handsets demand increased substantially.
  - Increased sales of antennas – up 37%.
  - Increased market share, strong margins.
• Integrated Products
  - Defence sales better, expected to increase second half.

Trading Outlook

• Wireless Infrastructure
  - Forecast demand recently increased for base station products.
  - Manufacturing capacity to be increased in China.
  - Additional OEMs being aggressively pursued to strengthen market position.
  - Initial quantities of power amplifiers delivered to new OEM customer.
  - Other power amplifier products being developed for this customer and 3 other OEMs.
• Handset Products
  - Expects to maintain market leading position
  - Record number of antennas under development for mobile phone programmes.
• Integrated Products
  - Selected by new customer as preferred supplier for RF switch products.
  - Volumes to exceed one million units per month.

In his summary to shareholders, Professor J. David Rhodes said: “Filtronic is a world leader in the design and manufacture of customised microwave electronic products. We have maintained our market leading position in our two main businesses. The facility at Newton Aycliffe provides the company with the compound semiconductor technology necessary in future microwave electronic products. The company’s financial position has been strengthened with the return to profitability and the refinancing of our borrowings.”

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