WMH Group Improved performance in the second half-year closed the sales gap relative to last year from 8.0% in the first half-year to 2.5% at year-end. Group sales finally closed at CHF 690.0 million (CHF 707.9 million). Net of exchange and consolidation effects, this represents a decline in sales of 2.3%. The decline was caused by the WMH Tools and WMH Air Conditioning business segments. Lower turnover in the retail business of WMH Tool Group which resulted from deliberately pursuing better margins could only partly be compensated by higher sales in the North American industrial business. WMH Air Conditioning fell short of the previous year's sales level for unit air conditioners and air conditioning systems mainly because of low temperatures during the summer months. However, more intensive activity in humidification and dehumidification as well as with air-inlet cooling systems for gas turbines succeeded in partly eliminating this shortfall. Thanks to good market conditions and increases in internal efficiency, WMH Heating shone with a 6.3% increase in sales net of consolidation effects.

With operating income of CHF 33.6 million (CHF 26.8 million), WMH again increased EBITA sharply relative to the previous year. Process optimization and the measures to improve margins in the retail business of WMH Tool Group showed first positive results.

The difficult market environment caused an impairment at Axair Climate: the full value of the goodwill was amortized. Goodwill amortization of CHF 1.3 million was charged to the income statement of WMH. The remaining goodwill of CHF 33.6 million relates mainly to business units in WMH Tools and WMH Air Conditioning where income is strong.

After deduction of financing and tax expenses of CHF 10.7 million (CHF 9.8 million) the resulting net income was CHF 21.3 million (CHF -9.1 million) which corresponds to earnings per -A- registered share of CHF 9.94.

The balance sheet contains a high level of liquidity of CHF 31.3 million. Receivables rose by CHF 10.8 million as a consequence of increasing business activity in the second half-year. Bank loans were reduced by CHF 8.3 million despite expenditure of USD 20 million for acquisition of minority interests in WMH Tool Group. Bank loans were reclassified from short-term to long-term liabilities to take account of the expiration in July 2006 of the syndicated credit of CHF 134.8 million. First indications are that the credit can be renewed on similar terms. The equity ratio - excluding minorities - rose from 28.9% to 39.2%. An increase of CHF 8.0 million in non-cash net current assets and CHF 8.9 million in net investments resulted in a free cash flow of CHF 18.6 million.

WMH Tools WMH Tools encompasses activities in the fields of tools and machines for woodworking and metalworking as well as material handling and workholding products. Within the segment, WMH Tool Group is aligned to the North American and European markets, while the Walter Meier Group is focused mainly on Switzerland but newly also on neighboring regions of Austria and Germany.

Although sales fell by CHF 20.5 million to CHF 290.0 million, EBITA of WMH Tools rose to CHF 6.5 million (CHF 2.2 million). In a weak market environment, the North American industrial business of WMH Tool Group experienced falling sales of woodworking machines while sales of metalworking machines as well as material handling and workholding products increased. Although the retail business also suffered falling sales, the loss was reduced by avoiding low-margin sales to home centers in the USA. The clear alignment of the organization and processes to the respective customer requirements of the Industrial and Retail divisions should bring a further increase in income in the current year. In Europe, there was a further substantial increase in sales. During the reporting year, numerous product innovations were introduced to the market where they were well received by customers.

In the stagnating Swiss market, Walter Meier Group improved both sales and EBITA relative to the previous year. New, exclusive representation in Austria of the manufacturers Quaser (Taiwan) and Doosan (Korea) will enable geographical expansion of the market in the future.

WMH Air Conditioning The companies that are combined together into the Axair Group distribute components for air conditioning systems as well as units and systems for air humidification and adiabatic cooling. The products for air humidification are manufactured at three locations in Switzerland, Canada, and China and distributed worldwide. Charles Hasler distributes components for air conditioning and refrigeration systems in Switzerland.

At CHF 231.9 million, sales of WMH Air Conditioning fell just short of last year's amount by 1.1%, or 1.5% net of exchange effects. Thanks to a general upturn in business in the second half-year, the shortfall on sales was largely eliminated by the end of the year. EBITA fell to CHF 15.9 million (CHF 18.5 million), mainly because of lower air conditioning sales in the UK and Switzerland.

Performance of the distribution companies in the Axair Group was varied. Low temperatures in the summer months temporarily weakened the unit air conditioners business. In the UK, increasingly predatory competition as well as prices of the main supplier being out of line with the market caused a sharp drop in sales. The supplier was therefore changed at the start of 2006. Sales in France increased. In Germany and Switzerland, the sales of the previous year were almost equaled thanks to a good second half-year.

Humidification and dehumidification activities were intensified in 2005 and the performance figures successfully improved relative to the previous year. Various large orders for air-inlet cooling systems for gas turbines helped to compensate for start-up costs in the end-customer business in the North American printing industry.

WMH Heating WMH Heating holds leading positions in the Swiss heating market with Vescal and Oertli Service. Vescal distributes products for heat generation and heat distribution, as well as heating components. Oertli Service maintains heating systems.

Sales of WMH Heating increased by 3.2% to CHF 168.1 million; after elimination of the effects of the sale of Oertli Induflame at the end of June 2005, the increase in sales was 6.3%. This improved performance in addition to internal increases in efficiency resulted in EBITA of CHF 17.3 million (CHF 13.5 million).

The good state of the construction industry affected the activities of WMH Heating positively. Expansion of the Vescal product portfolio with wood-piece and pellet boilers as well as new gas-fired heating boilers from Remeha/De Dietrich stimulated sales. Sales of heat pumps also increased sharply.

Outlook for 2006 In fiscal 2006, the WMH Tools and WMH Air Conditioning business segments will strive to increase sales and income. The organizational improvements at WMH Tool Group in the USA and Axair Climate in the UK should have a positive effect on the profitability of these companies. WMH Heating will be strongly challenged to match its good results of 2005. Given similar economic conditions, the increasing dynamism of WMH opens the prospect of further pleasing improvements in performance in 2006.

WMH Walter Meier Holding AG For 2005, WMH Walter Meier Holding AG reports income of CHF 35.8 million and expenses of CHF 24.1 million resulting in net profit of CHF 11.7 million.

Appropriation of earnings In the future, WMH shareholders will receive a greater share of earnings in the form of dividends. The payout ratio range has been increased. The Annual Shareholders' Meeting will be requested to approve payment of the following dividends:

CHF 5.00 gross per -A- registered share of nominal value CHF 25.00, CHF 1.00 gross per -B- registered share of nominal value CHF 5.00.

The resulting total dividend payment will be CHF 11.2 million. The remaining retained earnings of CHF 11.7 million will be carried forward to the new fiscal year.

Reduction of capital At the Annual Shareholders' Meeting on May 2, 2005, the share capital was reduced by CHF 5.0 million to CHF 55.8 million by elimination of 200 000 reserve -A- registered shares with a nominal value of CHF 25.00 each.

Board of Directors Gottlieb Knoch, who was elected to the Board of Directors in 2001, has announced that he will relinquish his membership of the Board of Directors as of the date of the Annual Shareholders' Meeting on April 25, 2006. Werner Kummer, who was elected to the Board of Directors in 2003 and whose three-year term expires this year, will stand for reelection.

WMH is a globally active group of distribution and industrial companies with three business segments: WMH Tools, WMH Air Conditioning, and WMH Heating. The main focus is on manufacturing and distributing leading-edge tools, machine tools, and systems for woodworking and metalworking, air conditioning, and heating. In all fields of activity the company holds, or strives for, positions of international market leadership (for heating systems, in Switzerland only). The companies of the WMH Group have a total workforce of around 1 800 employees. The shares of WMH are listed on the SWX Swiss Exchange (security number 1594024).

Dates: April 25, 2006 Annual Shareholders' Meeting August 10, 2006 First-half results 2006

Further information: * Dr. Reto E. Meier, Chairman of the Board of Directors * Hans-Peter Diener, CEO * Daniel Maissen, CFO

Stäfa, March 28, 2006

You will find this media release along with further information at www.wmh.ch.

The media release including tables can be downloaded in PDF format from the following link: