euro adhoc: KTM Power Sports AG / Financial Figures/Balance Sheet / US market and economic crisis depress results

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annual report

13.11.2008

Fiscal 2007-08
>> Sales: EUR 605.7 million (+7.0% from previous year)
>> EBIT: EUR 20.1 million (-49.4% from previous year)
>> Equity ratio: 35.2%
>> Vehicle sales: 92,385
>> X-Bow start of production, product expansion

Mattighofen, Nov. 13, 2008 - KTM Power Sports AG, Stallhofnerstrasse
3, 5230 Mattighofen, Austria (ISIN 0000645403), one of the world's
leading manufacturers of off-road and street motorcycles, ATVs and
the X-Bow premium sports car, succeeded in defying the difficult
economic situation to increase sales by 7.0% over the previous year
to EUR 605.7 million (exchange rate adjusted +10.4%). EBIT was
however down 49.4% from the previous year to EUR 20.1 million due the
drop in the US dollar exchange rate to 1.60 against the euro.

Growth drivers The higher figures are primarily due to the change in
model mix with the focus on the higher selling models in the LC4 and
LC8 series, increased turnover in ATVs (+404.4% from the previous
year) and improved sales in Related Products.

X-Bow rolls off the assembly line Following the decision to
manufacture the premium sports car, the X-Bow, at a separate facility
in Graz, production started towards the end of the business year.

Joint project with Bajaj running to schedule Cooperation with Bajaj
Auto Ltd. in developing engine and vehicle platforms for new 125 cc
and 250 cc street motorcycles is going very well. The first models
will be produced at Bajaj in India in 2010 and initially sold through
the KTM sales network in Europe and the Bajaj sales network in India.
One advantage of the joint project is that the complete vehicles can
be purchased in US dollars in India, which will therefore provide a
potential natural hedge.

Other events Rajiv Bajaj, managing director of Bajaj Auto Ltd., was
elected to the Supervisory Board at the annual general meeting in
December 2007. In addition, since signing the cooperation agreement,
Bajaj Auto Ltd. has successively acquired shares in KTM Power Sports
AG, currently holding 25.86%, and has expressed an interest in
increasing to up to 30%.

Outlook As the risk of a recession has become greater, we have to
assume that the relevant sales markets for KTM will become smaller.
We therefore plan to reduce volume by around 10% for the 2008-09
business year. Given the premium strategy and action taken to
optimize capacity utilization, KTM is prepared to cope with sustained
difficult market conditions. The successful start of X-Bow production
and the anticipated sales revenue from the Sportcar Division will
partially compensate for the drop in sales in the Sportmotorcycle
Division. Further, the measures we started implementing last year to
optimize capacity utilization and increase efficiency will begin to
bear fruit in business year 2008-09. We have also hedged the foreign
currency exposure to a great extent for the current fiscal year.
Above all, the US dollar exposure is secured at worst at an average
exchange rate against the euro of 1.42. In view of the action we have
taken to optimize operations and the stronger USD/EUR exchange rate
compared with the previous business year, we can assume that if the
recession is slight, we will be able to marginally increase the
operating result despite the planned reduction in volume and achieve
break-even free cash flow.

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The 2007-08 annual report and annual financial report are available
for downloading on our website at www.ktm.com under Investor
Relations > Investor Relations > Reports.

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EUR million (IFRS) 2007/08 2006/07 Change
Sales 605.7 566.1 7.0%
EBIT 20.1 39.8 -49.4%
Equity ratio 35.2% 40.5% -
Earnings per share 0.88 3.57 -75.4%
EBIT margin 3.3% 7.0%
Employees (average) 1,964 1,778 +186

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end of announcement euro adhoc
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ots Originaltext: Cross Holding AG
Im Internet recherchierbar: http://www.presseportal.de

Further inquiry note:

KTM Power Sports AG

Mag. Wilfried Stock

Tel.: +43(0)7742/6000-216

mailto:wilfried.stock@ktm.com

Branche: Technology
ISIN: AT0000645403
WKN:
Börsen: Wiener Börse AG / official dealing