Growth strategy on track – Lively textile business – Integration of Graziano and Fairfield at an advanced stage.

Dear Shareholders
The first half of 2006 was marked by increasingly lively demand in the textile market. In addition to the already established increase in demand for cot-ton processing machines, demand for filament spinning and texturing was stronger than expected. The Asian markets of India, China and Pakistan, in particular, demonstrate strong demand for investment in new and replace-ment machinery. Because of the low order book at the beginning of the year, sales in the first half were below the previous year, excluding acquisitions. Transmission Systems developed in line with expectations communicated at the beginning of the year. The integration of Fairfield is well advanced. The first phase of the expansion of capacity for transmission components using the infrastructures of the textile division in the Czech Republic and China will be completed by the end of the year and the enlarged plant in India will start production in August, as scheduled. Overall, Saurer is on track with the implementation of its growth strategy.

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contact:

Simone Lalive d´Epinay
Corporate Communciations and Investor Relations

Saurer Management AG
Bahnhofplatz 12
8401 Winterthur
Tel: +41-52 264 09 14
Fax: +41-52 264 09 10
Mob: +41-79 337 89 13
www.saurer.com