Chairman's forewordApril 2011

Dear Shareholder,

For Egide, 2010 has been the year of crisis recovery. This is evident in a return to profitability and by strong growth.

The positive net result settled at 0.7 m€, with 0.9 m€ profit linked to the sale and leaseback of our Bollene site. Our operating profits from the first half of the year, as we presented last October, would have been minus 0.5 m€ without this transfer. The second half of 2010 has however yielded a plus of 0.3m€. This imbalance between the first and the second half of the year can be explained by the step-by-step recovery from the crisis - at 11.6 m €, the turnover from the first half of the year was lower than our breakeven point, whereas 13.1 m€ in the second half, was greater than this point.

With regard to 2011, this pattern of step-by-step growth seems to have continued. In the first quarter we achieved a turnover of 7.0 m€, and we have shown that we foresee sequential progress of 5 % for the second quarter. We expect new progression in the 4th quarter; therefore growth of 15 % for the year is a reasonable objective, all the more since the profile provided by our clients with regard to their needs is good and our order book is healthy. Growth is currently driven by the considerable demand for telecoms and by the need for infrared products for defense and security. The expected level of activity in 2011 is therefore well above our breakeven point and operational margins such as Ebitda should be positive.

Today, Egide is clearly positioned in the “high-end” electronics sector. The diversification initiated since 2005 on lead markets, such Defense and Security, has enabled Egide to navigate two periods of serious turbulence, and to withstand the latest crisis. This diversification, combined with our constant efforts in R&D, should be extended to new markets. This “high-end” positioning will enable the Group to remain en route to lucrative growth and continue to satisfy its clients who have, for the most part, needs which are increasing markedly. Currently the telecoms sector is increasing its applications both in terms of performance and volume to satisfy the multiplication of communication objects and network saturation. The Defense and Security sectors are recording a new surge in demand for infrared packages, for which Egide is a global leader; while the industrial sector is showing positive signs of recovery, in aeronautics as well as in automobile and in medical.

Philippe Brégi
President – Chief Executive Officer