Electric Fuel’s Second Quarter Losses Cut

Electric Fuel Corporation, the world’s leading zinc-air fuel cell company, has reported results for the second quarter and for the six months ended June 30, 2002.

New York, New York – July 31, 2002 [SolarAccess.com] Results for the quarter do not reflect the results of MDT Protective Services, Ltd., since this acquisition, which the company announced on July 23, 2002, will start to be included in the company’s results from July 1, 2002. This acquisition is expected to impact results starting in the third quarter of 2002 and second half 2002 revenues. The combination of this acquisition, battery sales and the Company’s corporate strategy to accelerate growth in its defense and security business, are anticipated to substantially increase second half 2002 revenues to more than US$5 million. Net loss for the quarter ended June 30, 2002 decreased by 20 percent to US$2.7 million, as compared with US$3.3 million during the previous quarter and decreased by 42 percent as compared with US$4.6 million for the corresponding quarter in 2001. Loss per share for the quarter ended June 30, 2002 narrowed by 18 percent to US$0.09, as compared with US$0.11 during the previous quarter and by 53%, as compared with $0.19 for the corresponding quarter in 2001. Revenues for the quarter ended June 30, 2002 increased by 12 percent to US$824,000 as compared with US$727,000 during the previous quarter and decreased by 20 percent as compared with US$1.0 million for the corresponding quarter in 2001. Cash-on-hand and cash equivalents totaled approximately US$10.5 million as of June 30, 2002. “We are very satisfied to see tangible results from our cost-cutting efforts over the course of the past year. The next step is to increase our revenues and attain profitability. With our new corporate growth strategy, we anticipate the company’s second half revenues to more than double to over US$5 million, as compared with the US$2.25 million we posted in the second half of 2001,” said Electric Fuel’s president and chief executive officer Yehuda Harats. “This increase is expected to come largely from the increase in sales of battery products to the military and homeland security markets and from the revenue contribution from MDT’s van and car armoring business.” (Nasdaq: EFCX)

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