TOMRA´s RETURN 02/2008:Amund Skarholt, President & CEO editorial

Our Materials Handling operations in the US have had a challenging year, first with high fuel prices and more recently with decreasing commodity prices. Despite these challenges, we have managed to expand our collection centers in California and increase our market share of the collected volumes in this market by about 10% during the year.

All of the companies within the Industrial Processing Technology segment have shown strong revenue growth, clearly demonstrating that the solutions they provide are in high demand from both new and existing customers. In this segment we also concluded the acquisition of UltraSort, a company whose technology and operations will complement very well our existing material sorting activities within the mining sector. The benefits our sorting technology can provide to this industry are significant, both financially and environmentally.

In the Collection Technology Non-Deposit segment we have expanded installations into new markets and Tesco is continuing the roll-out of our Automated Recycling Center (ARC). As we now feel that the technology developed for the ARC is at a satisfactory level, the product can be transitioned from a heavy R&D focus to an engineering phase. Consequently we restructured our R&D activities in Asker in the third quarter, and together with other adjustments we expect this to yield a cost reduction effect of 60 million Norwegian kroner in 2009.

Looking at our operations from an environmental perspective, our solutions around the world are collecting 30 billion beverage containers, processing 300,000 tons of containers, sorting eight million tons of valuable commodities and compacting about 30 million tons of waste – all of which is recycled. In this regard, we estimate that our solutions are helping to save about 10 million metric tons of CO2 each year – an amount equivalent to about 20% of the total CO2  emissions produced by Norway.

Over the last couple of months the financial and business environment and framework has changed dramatically. Some businesses and industries have come to a standstill and the financial system is not working properly. This will of course also impact our company, but very differently from business area to business area and stronger in some markets than in others. As a company, TOMRA is very well positioned to handle the upcoming challenges. Both from a financial point of view and from an industry segment and market position point of view. For all of us the main priority is to stay focused on the opportunities and daily challenges.

The environment has moved prominently forward on the agenda around the world. So far it looks like the green movement is not being sacrificed due to the current financial challenges. In fact, all indications suggest there will be an increased investment on green initiatives and technologies in an effort to re-tool the economy for future growth and fight global warming at the same time.

By focusing on our company values – thinking innovatively, acting responsibly and showing passion for our work - I am sure that our company will be able to look back a year from now satisfied that we have delivered great value to our customers and the environment. Best wishes to all for a Merry Christmas and a Happy New Year.