Strategic Investments A/S
Interim report for the period 1 July – 30 September 2012

Danionics A/S 

30.11.2012 18:15
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Copenhagen, 30 November 2012, 2012-11-30 18:15 CET (GLOBE NEWSWIRE) -- Summary

  -- As expected, Danionics reported a loss of DKK 0.7 million for the third
     quarter of the year.
  -- The company reiterates its full-year forecast of a loss of DKK 3 million
     before recognition of the share of the profit/loss or value adjustments in
     Danionics Asia.
  -- Danionics incurred costs of DKK 0.1 million on behalf of Danionics Asia
     during third quarter of the year.



Management's report

Third quarter 2012 financial performance

As expected, Danionics reported a loss for the third quarter of DKK 0.6 million
before recognition of a DKK 0.1 million writedown of the loan capital to
Danionics Asia. The writedown equals the sales and marketing costs Danionics
incurred on behalf of Danionics Asia in the third quarter. The third quarter
financial performance was approximately DKK 0.3 million worse than the results
achieved in the same period of last year. The difference is due to higher
administrative expenses this year and the fact that there was no writedown of
the loan capital to Danionics Asia last year because there no costs were
incurred on behalf of Danionics Asia in the third quarter 2011. 

The loan capital to Danionics Asia is recognised in the amount of DKK 0 at 30
September 2012, which is unchanged from 30 September 2011. 

Cash amounted to DKK 1.4 million. Equity amounted to DKK 0.8 million at 30
September 2012, down from DKK 3.1 million at 31 December 2011. The change in
equity corresponds to the net loss for the period. 



The joint venture

Danionics' joint venture is in a critical situation.

Danionics Asia prepared to begin selling large batteries for tablets in the
latter part of 2001, but sales failed to materialise. Apple and Samsung are the
dominant players in this market, and the customers Danionics Asia received an
interest from, who were mainly from Taiwan, did not succeed with their
products. 

In order to ensure the survival of the joint venture, Danionics concluded an
agreement with its joint venture partner in Hong Kong, Gold Peak Batteries, to
let the company's factory in Shenzhen, China, take over the entire production
of electrodes for the Gold Peak Group. Gold Peak Batteries took over the
battery sales and tried to build a market with particular emphasis on the
portable rechargeable battery market. 

The production of electrodes has been severely affected by the economic crisis,
and demand has been 25% lower than the output level. Demand for portable
rechargeable power banks is down 30%. 

Even the market for batteries for electric bicycles, which was also seen as a
potential opportunity, has suffered from falling demand, which was particularly
felt in the dominant Dutch market during the very wet summer. 

Accordingly, the company continues to be loss-making, and the fact that Chinese
wages for skilled labour in the production of electrodes have risen by 20% has
made the situation worse. 



Outlook for 2012

Danionics maintains the forecast for 2012 presented in the annual report for
2011 released on 27 February 2012. The financial performance for 2012 will be
affected by sales and marketing costs in the joint venture as well as
administrative expenses of around DKK 3 million. Overall, Danionics expects a
loss in the range of DKK 2.5 - 3 million after interest income but before
recognition of any share of the profit/loss for the year or value adjustments
in Danionics Asia Ltd. 

The company's equity amounted to DKK 3.1 million at 31 December 2011. Based on
the expectations of a loss of approximately DKK 3 million in 2012, equity is
expected to be close to 0 at the end of 2012. 

Since the company's last announcement to Nasdaq OMX Copenhagen, management has
been focused on identifying parties who might be interested in taking part in a
share issue or in acquiring the company's stock exchange shell. 

The negative performance of the joint venture has in reality eliminated the
possibility of making a share issue and management therefore continues the work
to identify a buyer for the company's stock exchange shell. 

It remains uncertain whether these efforts will be successful. If they are not,
management intends to wind-up the company. 



For additional information, please contact:

Henning O. Jensen, Chief Executive Officer, tel. +45 70 23 81 30
News Source: NASDAQ OMX



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Language:     English
Company:      Danionics A/S
              
               
              Denmark
Phone:        
Fax:          
E-mail:       
Internet:     
ISIN:         DK0010271238
WKN:          
 
End of Announcement                             DGAP News-Service
 
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