Elektrobit warns due to costs, Terrestar case still uncertain

Elektrobit Corporation (OMXH: EBC1V) lowers its H1 operating result guidance due to lower than planned profit within both Automotive and Wireless Business segments as costs have been higher than anticipated. First half net sales are expected to grow clearly from last year while operating result will be close to zero. Elektrobit still expects net sales and operating result to grow clearly from last year (162.2 million and -4.4 million Euros).

Additionally Elektrobit will book 0.8 million Euro provision related to Terrestar Companies receivables in Q2 accounts as the restructuring process is continuing longer than expected. Second quarter operating result is now expected to be below Q1. Elektrobit’s well known receivables and other claims toward TerreStar Networks Inc. and TerreStar Corporation that are in Chapter 11 process total 27.9 million USD. Elektrobit made it clear that there is considerable uncertainty regarding the outcome and credit risk may still grow in 2012.