Excellent start to new fiscal year 2005/06

Further expansion of market share and sharp rise in profitability

The Phonak Group has made an excellent start to the new fiscal year 2005/06. For the first half of 2005/06 (ending September 30, 2005) management expects sales growth of 19-21% in local currency and an EBITA margin of 22-24%. Phonak has continued to gain significant market share. The management expects to outperform market growth over the full year, and is increasing its guidance for sales and profit in the fiscal year 2005/06 anticipating sales growth of 13-15% in local currency and an EBITA margin of 22-24%. This new outlook is a further improvement on the target figures published in June 2005, which estimated sales growth of over 10% and an EBITA margin of around 20%.