The Norman Group had net revenues of NOK 34.9 million in the 3^rd quarter 1998 and NOK 110.8 million for the year to date, increases of 34% and 44% on the equivalent periods in 1997. The increase for this quarter was lower than expected, and combined with marginally increased operating costs, resulted in an operating loss of NOK 9.8 million for the 3^rd quarter 1998 and NOK 17.9 million for the year to date. This is nevertheless a notable improvement on the operating loss of NOK 45.4 million for the equivalent year to date period in 1997. Although the Board is disappointed with this quarter’s result, it emphasises the annual increase in net revenues of 44% which is in line with market growth, as well as the increasing share of export and access control sales. This is evidence that Norman is succeeding in its strategy of diversification away from Norwegian based sales.

Analysing the 3^rd quarter 1998 revenue figures in more detail, Managing Director Gunnel B. Wullstein, explains that Norman’s focus on larger projects continues to give a high degree of revenue volatility. This, combined with a slower start-up than anticipated in Sweden and the UK as well as lower than expected data recovery sales, are the main reasons for the revenue shortfall. However, Norman’s strong cash position ensures that action will continue to be taken to sustain high revenue growth over the long term.

Norman maintains its forecast of an operating profit in the 4^th quarter 1998 but foresees an operating loss for the year as a whole.

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Enclosed is a summary of the unaudited financial statements for the 3^rd quarter 1998.