NEWAYS ELECTRONICS : Neways relocates part of production ops

PRESS RELEASE

NEWAYS ELECTRONICS INTERNATIONAL N.V.

Number of pages: 2

Neways relocates part of production ops
Move will mean improved capacity utilisation, cost savings and reduced investment levels

SON, 31 JANUARY 2013 - NEWAYS ELECTRONICS INTERNATIONAL N.V. (Neways) (NYSE Euronext: NEWAY) intends to terminate the independent activities of its operating company Neways Electronics Echt (NEE). The decision was prompted by the continuing volatility in the Electronic Manufacturing Services (EMS) market and the ensuing persistent imbalance in the capacity utilisation within the Neways group. NEE specialises in the development, assembly and testing of high-grade industrial control electronics and books annual turnover of around EUR 15 million.  

All NEE activities, including the entire inventory of machines, will be moved and redistributed to the other Neways operating companies. This means that some of the planned investments in capacity expansion within the Neways group will no longer be necessary. 

The redistribution of NEE's activities will lead to reduced investment levels and structural cost savings of as much as several million euros annually from mid-2013 onwards. Neways will set aside a provision to cover the one-off costs of the move and charge this to the 2013 results. These costs are unlikely to exceed the annual cost savings. The redistribution of NEE's activities will make a considerable contribution to improved capacity utilisation across the Neways group.

Neways aims to provide as many of the 100 salaried NEE employees as possible with alternative positions at other Neways operating companies. In addition, Neways is in talks with the works council and unions on further flexibilisation of the employment terms of said employees to preserve as many jobs as possible. Greater flexibility in the wage cost structure is one of Neways' key strategic focal point in terms of improving the services to its clients in an increasingly dynamic EMS market. This inevitably means maintaining a greater proportion of flexible employees. 

Following the trading update published on 1 November, Neways was faced, in November and December of 2012, with continued postponements of investment plans, which led to further pressure on capacity utilisation and profitability. Neways expects to close 2012 with turnover well below 2011 levels and a positive operating result substantially below the level of the previous year.  

Neways will publish its 2012 full-year results before the opening of the stock exchange on 26 February 2013. 

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For further information please contact:

V.B.M. de Bok (CEO/CFO) Tel: [phone] Mob: [phone]	H.W.T. van der Vrande (CEO/COO) Tel.: [phone] Mob: [phone]
	Neways Electronics International N.V. Address head offices: P.O. Box 69, 5690 AB  SON Website: www.neways.nl

Neways Electronics International N.V. (Neways) is an international company active in the EMS (Electronic Manufacturing Services) market. Neways offers its clients custom-made solutions for the complete production lifecycle (from product development to after-sales service) of both electronic components and complete (box build) electronic control systems. Neways operates in a niche of the EMS market and focuses primarily on small to medium-sized specialist series, with quality, flexibility and time-to-market playing a crucial role. Sectors in which Neways´ products are used include the semi-conductor, medical, automotive, telecom and defence industries. Neways has operating companies in the Netherlands, Germany, Slovakia and China, with a total workforce of around 2,200 employees in 2011. In 2011, Neways booked net turnover of EUR 283.9 million. Neways is listed on Euronext Amsterdam (symbol: NEWAY).