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EXEL OYJ?S INTERIM REPORT, JANUARY 1 - S

4.11.2003 11:00 EET
EXEL OYJ STOCK EXCHANGE RELEASE 4.11.2003 at 11.00 a.m. 1(6)

EXEL OYJ’S INTERIM REPORT, JANUARY 1 - SEPTEMBER 30, 2003

Summary:

- Strong growth continued in the third quarter; net sales totaled EUR
14.8 million (12.8), up by 15%, and operating profit totaled EUR 1.9
million (1.3), up by 41% on the corresponding period of 2002.
- During the period January-September 2003 net sales up by 7% and
operating profit by 34%.
- Operating profit improved due to the improved market situation, cost
savings and the increased popularity of Nordic Walking in Central
Europe.

Operating environment

The early signs of market recovery, which began early this summer,
have continued in the autumn in the Industry division. Despite weak
economic growth in our main markets in Central Europe, the demand for
specialty products, especially carbon fiber profiles and products
related to Exel’s Nordic Fitness SportsTM (NFS) concept has been very
good. We expect the trend to continue.

The raw material markets have been stable despite the occasional price
hikes affecting the oil price. In 2004, there will be pressure to
raise raw material prices, especially in carbon fiber, as aircraft
industry requirements are on the increase, causing growth in demand
for some carbon fiber types.

Industry division

The net sales of the Industry division for the period January-
September 2003 increased by 8.8% and totaled EUR 20.2 million (18.6).
The division’s profitability also remained good, and the operating
profit increased to EUR 2.2 million (1.9). The Industry division’s
product sales continued to increase, despite the fact that its
customers’ manufacturing activities in basic products remained
cautious. The price competition on the market is tight, which creates
cost pressures.

Despite the caution in the market, the demand for specialty profiles
is high. The profiles product group is carrying out several big R&D
projects mainly focused on the automotive industry, infrastructure
construction and wind energy.

The antenna profiles market took off in the summer, and demand has
continued to increase in the autumn. Demand is expected to remain
strong until next spring. The strong demand anticipates investments in
3G networks.

In the paper industry, machine capacity utilization rates remained
low, which was reflected in the sales volumes of doctor blades. In the
autumn Exel and Metso Corporation have agreed on renewal of their co-
operation and product development agreement.
                                                               2 (6)

The lattice mast market picked up significantly in the beginning of
the summer. Demand is expected to increase further as airports prepare
to meet the new regulations set by the International Civil Aviation
Organization (ICAO). The regulations, which come into effect in 2005,
stipulate that the lattice masts used as support structures for
airport lighting systems must break in the case of collision.

Sport division

The net sales of the Sport division during the period totaled EUR 20.5
million (19.4), up by 5.7% on the previous year. Profitability
improved significantly, with the operating profit totaling EUR 1.7
million (0.9). The NFSTM concept is gradually conquering markets and
arousing great interest in the otherwise slow-growing sports goods
market.

The NFSTM and Nordic Walking markets in particular are still growing
strongly in the German speaking countries of Central Europe. Exel’s
share of the market has remained extremely strong. At the moment,
Nordic Walking is being introduced to new countries such as Australia,
Canada, Japan and Estonia. Exel opened its first Nordic Fitness
SportsTM Park in Saariselkä, Lapland this summer in co-operation with
the International Nordic Walking Association. The park is equipped
with signposts and the walking routes are clearly marked for the
benefit of users. Similar parks have also been opened in Germany and
Austria.

Laminate sales have not reached the set targets as customer production
volumes have been lower than expected. The low product volumes of skis
and snowboards and of specialty products have had the biggest effect.
Exel has reorganized the operations of Exel GmbH Plastics by moving
the printing of snowboard bases to subcontracting during the summer.
In water sports, the demand for windsurfing masts has remained stable.
Customer deliveries for the new collection began in September.

In the main floorball market areas, i.e. Finland, Sweden and
Switzerland, market shares have remained virtually the same. The
International Floorball Federation and companies operating in the
field are working hard to introduce floorball to new countries, e.g.
Germany, Canada and Russia, all prominent ice-hockey countries.

Sales and profits

The Group’s net sales grew by 7.2% compared with the previous year.
The distribution of net sales by division was as follows:

Net sales
(EUR million)     1-9/2003          1-9/2002          Change
Industry          20.2              18.6              8.8%
Sport             20.5              19.4              5.7%
                                                               3(6)

Total             40.8              38.0              7.2%

Growth in the Sport division was mainly concentrated on Nordic Walking
pole sales in Central Europe, which compensated for the low laminate
sales. In the Industry division, the strongest growth was experienced
in antenna profiles sales and in new carbon fiber applications.

The Group’s operating profit was EUR 3.9 million (2.9). The
distribution of operating profit by division and the change compared
with the previous year were as follows:

Operating profit
(EUR million)     1-9/2003          1-9/2002          Change
Industry          2.2               1.9               12.0%
Sport             1.7               0.9               78.3%
Total             3.9               2.9               33.7%

Profitability continued to improve, due to increased sales, the
improved productivity of the Sport division’s production, and the cost
savings conducted mainly in the Group’s Finnish units.

Net financial expenses

Net financial expenses totaled EUR 339,000 (474,000). The decrease in
financial expenses was the result of rearrangements made in short-term
loans, and repayment of long-term loans.

Balance sheet, financing and liabilities

The balance sheet totaled EUR 34.4 million (36.0). Interest-bearing
net liabilities decreased by 44.6%, totaling EUR 7.8 million (14.1).
Liabilities remained practically the same.

Capital expenditure

Group capital expenditure totaled EUR 1.4 million (1.5). Investments
have been kept on a low level. New investments were mainly
concentrated on moulds and tools related to product development.

Personnel

On September 30, 2003, Group personnel totaled 342 employees (357).
The decrease was due to the downsizing activities conducted in the
Sport division.

Shares and ownership

Exel Oyj’s share capital is EUR 1,854,755 divided into 5,299,300
shares each with a nominal value of EUR 0.35. The members of the Board
of Directors and the President hold 98,100 shares, i.e. 1.9%.

The number of shares traded on the Helsinki Exchanges during the
period under review amounted to 16.6 % of all shares. During the
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period the highest share price quoted was EUR 9.00, and the lowest EUR
5.50. The closing price for the review period was EUR 8.55. Market
capitalization was EUR 45.3 million on September 30, 2003.

Prospects for the rest of 2003

The market outlook for the end of 2003 is positive. The popularity of
Nordic Walking in Central Europe is increasing. The demand for antenna
profiles remains good. Significant expenses are booked on new product
developments. Cost pressures are growing due to increasing demand for
certain raw materials. Based on these factors, the company estimates
that its net sales for 2003 will increase and its operating profit
will improve significantly from the previous year.

Mäntyharju, November 4, 2003


Exel Oyj                   Ari Jokelainen
Board of Directors         President & CEO


EXEL GROUP

CONSOLIDATED INCOME STATEMENT

EUR 1,000                  1-9/03   1-9/02   change % 1-12/02

NET SALES                  40,760   38,016   7        51,203
Increase(+) or decrease (-)
of finished goods and
work in progress           619      716      -14      422
Production for own use     202      174      16       251
Other operating income     323      440      -27      770

Materials and services     -15,159  -15,165  0        -20,175
Personnel expenses         -10,435  -9,837   6        -13,198
Depreciation               -2,421   -2,355   3        -3,318
Other operating expenses   -10,039  -9,110   10       -12,153

OPERATING PROFIT           3,850    2,879    34       3,802
Financial income and
expenses (net)             -339     -474     -28      -655


PROFIT BEFORE EXTRAORDINARY
ITEMS                      3,511    2,405    46       3,147
Extraordinary items


PROFIT BEFORE INCOME
TAXES                      3,511    2,405    46       3,147
Income taxes               -1,074   -715     50       -921

                                                               5 (6)
PROFIT FOR THE PERIOD      2,437    1,690    44       2,225

The taxes taken into account are based on the profit for the period.


CONSOLIDATED BALANCE SHEET

EUR 1,000                  30.9.03  30.9.02  change % 31.12.2002

ASSETS
Non-current assets
  Intangible assets        3,013    3,537    -15      3,521
  Consolidation goodwill   348      419      -17      402
  Tangible assets          10,205   11,096   -8       10,636
  Investment               95       127      -25      127
Current assets
  Inventories              8,697    8,883    -2       7,962
  Receivables              9,754    11,119   -12      6,635
  Marketable securities    344      0
  Cash in hand and at bank 1,938    851      128      2,525
Total                      34,393   36,032   -5       31,807


LIABILITIES AND SHAREHOLDERS’ EQUITY
Equity
  Share capital            1,855    1,840    1        1,853
  Other equity             14,465   12,462   16       13,086
Liabilities
  Deferred tax liability   109      171      -36      106
  Non-current              4,453    6,600    -33      6,223
  Current                  13,512   14,959   -10      10,538
Total                      34,393   36,032   -5       31,807



FUNDS STATEMENT

EUR 1,000                  1-9/03   1-9/02   change % 1-12/02

Cash flow from business
Operations                 2,884    -175     1,748    5,348
Invest in tangible and
intangible assets          -1,495   -1,593   -6       -1,682
Income from surrender of
tangible and intangible
assets                     102      42       143      57
Rights issue               6        43       -86      147
Withdrawal of non-current
loans                      54       50       8        71
Repayments of non-current
loans                      -1 810   -1 808   0        -2 205
Withdrawals of/repayments
                                                               6 (6)

of current loans           1,060    4,228    -75      679
Dividend paid              -1,060   -1,840   -42      -1,840
Other                      16       -30      153
Change in liquid funds     -243     -1,083   78       575


                           30.9.03  30.9.02  change % 31.12.2002

Indicators (EUR 1,000)
Gross investment           1,393    1,545    -10      2,014
% of net sales             3%       4%                4%
R&D expenses               1,248    823      52       1,113
% of net sales             3%       2%                2%
Average personnel          355      378      -6       374
Personnel at end of period 342      357      -4       359
Order book                 8,870    8,723    2        7,564
Solvency ratio, %          48%      40%               47%
Return on investment, %    20%      14%               14%
Net gearing, %             48%      99%               55%
Earnings per share, EUR    0.46     0.32     44       0.42
Equity per share, EUR      3.08     2.70     14       2.82


Consolidated contingent liabilities on September 30, 2003
Corporate mortgages        12,500   12,500            12,500
Mortgages on land and
Buildings                  2,954    2,954             2,954
Other contingent
liabilities                2,477    3,312             2,694

Columns 1-9/03 and 1-9/02 are unaudited.



Exel Composites Oyj, Vantaa head office, Mäkituvantie 5, FI-01510 Vantaa, Finland