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					Telenor Top Management Conference

       Fornebu, 3 September 2003
”Building an international company
          out of Norway”
TOMRA – an international market leader
 World leading supplier of integrated recycling systems and
  technology
 Worldwide machine installations: ~49,000
   – Norway ~ 3,500
   – Europe ~ 32,500
   – North America ~ 13,000

 97% of revenues generated outside of Norway
 Over 2,000 employees with approximately 1,750 outside
  Norway
 Over the past several years between 50 and 75% of shares
  owned by foreigners
 Total market share >90% throughout 46 markets
 Market expansion



1970s
1970s



1980s
1980s


1990s
1990s


2000s
2000s


  subsidiary



 distributor
 Tremendous historic sales growth
 fueled by international markets
3000
                                                                                        25922667
2500                                                                                2325
2000                                                                            1951

1500
                                                                             1263
1000                                                                   996
                                                                 700
500
            53 75 126 7797 133 157 205 234 262     302 386 501
         35
  0
       1982   1984   1986    1988   1990    1992     1994    1996        1998       2000   2002
       Note: Sales figures in million NOK
Vision
TOMRA in the recycling loop
TOMRA success factors
                              Uniquely positioned to
                                 capitalize on global
    Strong org. passion,           recycling trend        Strong position in
     commitment and                                     technology niche with
   ability to develop and                               high growth potential
       deliver on new
       opportunities
                            Innovation
                            Leadership                        High margin,
                                                            hardware business
Recycling value chain                                          with unique
      competence                                               technology

                            Main base in countries
                               that lead recycling
                                  development
Technological innovation


  TOMRA’s position as the market leader is
  due in large part to its unique application
  of cutting-edge technology

       First self-programmable
        machine




                  TOMRA SP (1978)
Technological innovation




    First fully automated crate
     recognition system




               TOMRA CRA (1981)
Technological innovation




    First machine to handle both
     glass and plastic bottles as
     well as crates




              TOMRA 300 (1986)
Technological innovation




    First to handle all types of
     non-refillable containers in
     one machine




               TOMRA 62 (1994)
Technological innovation




    First all container machine,
     with unique video imaging
     recognition for shape




               TOMRA 600 (1997)
Technological innovation




    High capacity collection of non-
     refillables, with single chamber
     recognition of shape and
     barcode



             TOMRA 83 HCp (2001)
The integrated RVM solution
                              Man Machine
                              Interface &
                              Automation
 Recognition
   system




                          Data Administration
  Processing & In-
                           & Online Services
   store Logistics
Key conditions for TOMRA as a
Norwegian-based, international
competency company
 Demographics



                         …Norway in the real
                         perspective

                                    Norway

The world according to
Norwegians…
Important economic conditions for TOMRA


  Currency exchange
   – Stronger NOK caused by higher interest rates & labor cost
     growth relative to trading partners
     Strong NOK has had major impact on TOMRA’s
     financial performance
   NOK vs. EUR & USD1)                                 ~(270) MNOK currency
   Weekly figures. 12. jan.02 - 19. juni 03             exchange impact on
 6                                     6
                                                        revenue in 2002, equal to
                                                        10% of prior year revenue!
 7                                              7
     NOK/EUR
                                                       ~(90) MNOK currency
 8                                              8       impact on operating profit in
                                                        2002
              NOK/USD
 9                                              9
                                                       Based on TOMRA’s high P/E
                                                        valuation, it can be
10                                               10
                                                        estimated that currency
 jan.02 apr.02 jul.02 okt.02 jan.03 apr.03 jul.03
1) Rising
                                                        impact may have reduced
            curve means strengthening NOK
Source: Norges Bank                                     share valuation by over 1.8
                                                        billion NOK
Important economic conditions for TOMRA

  Currency exchange
   – Stronger NOK caused by higher interest rates & labor cost
     growth relative to trading partners

  Labor costs in Norway
   – Higher than trading partners and gap continuing to widen
Labor costs in Norway are 35% higher
vs. trade partners

                                  Wage level for industry workers in
                                         Norway vs. abroad               TOMRA outsources a great
                                                                          deal of its production needs
                                  140

                                                                         Up to 90% of the cost of a
 Index (Trading partners = 100)




                                  135

                                  130
                                                                          machine stems from
                                  125

                                  120
                                                                          TOMRA’s supplier network

                                                                         TOMRA and its supplier
                                  115

                                  110

                                  105
                                                                          network have increased
                                  100                                     share of outsourcing abroad
                                                                          dramatically over the last
                                          2000      2001         2002


                                    All              Nordic countries     two years
                                    Euro-area        Non-Euro area

 Source: Finansdepartementet
35% of the input costs into the T-83
stem from Norway vs. 58% in 2002
        Production input costs for T-83
          in NOK vs. other currencies

100 %




                                   NOK: 35 %
80 %

          NOK: 58 %

60 %




40 %
                                     Other
                                   currencies:
            Other                     65 %
20 %      currencies:
             42 %


 0%
                                                 TOMRA’s new flagship machine:
         Beg. 2002                   Today
                                                     the TOMRA HCp 83
What does Norway have going for it?

 Demographics?
   – Norway is located at the edge of the world

 Economics?
   – High labor costs
   – Strong currency
   – Stringent tax regime for individuals

 Innovative capacity?
   – Majority of engineers focus on already established industries
     such as fishery, oil, metalurgy & bio-tech
   – Lack of broadness in engineering education and lack of focus on
     advanced technologies, within mechanics and electronics
  Is Norway focusing its R&D resources correctly to
  create breakthrough innovation?
                     Total researchers per thousand total
                                 employment

20
15
                                                                                                                             Norway has a relatively high
10
 5                                                                                                                            number of researchers
 0
               FIN                 JAP                 SWE                USA            NORWAY                   …


                     Civil budget R&D as a percentage of GDP

1,0 %                                                                                                                        …and spends a relatively
0,5 %                                                                                                                         high amount of money on
0,0 %
               ICE          FIN      HOL          GER         FRA         SWE           JAP     PORT         NOR        …
                                                                                                                              research
               Number of patents families per thousand capita
                                population

 0,100


 0,050
                                                                                                                             …but generates a relatively
 0,000
         SW
           I
               SW
                 E    JAP    FIN   GER   US
                                            A
                                                HO
                                                   L
                                                        LUX   DK    ICE   OE
                                                                            CD   F RA    EU       G
                                                                                              BE L USTR
                                                                                                        IA   UK
                                                                                                                 RW
                                                                                                                   AY   …
                                                                                                                              low number of patents
                                                                                                   A           NO




     Source: OECD (2000)

				
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