Frost & Sullivan Recognizes EXFO for Visionary Growth Strategy

    Business Editors/Technology Editors

    PALO ALTO, Calif.--(BUSINESS WIRE)--March 8, 2005--Frost & Sullivan announced today that EXFO Electro-Optical Engineering Inc., a recognized test and measurement expert in the global telecommunications industry for the past 20 years, has been named recipient of the 2005 Growth Strategy Leadership Award.
    The Award is presented annually to the company whose visionary growth strategy generates the largest market-share gains in the global fiber optic test equipment (FOTE) market during the last year.
    Based on a soon-to-be released study entitled, World Fiber Optic Test Equipment Markets, EXFO increased its market share in 2004 by 22.6% compared to 2003. And dating back to the severe downturn in the global telecommunications industry, which caused FOTE revenues to decline 43.8% between 2001 and 2004, EXFO grew its market share by 60.9% during that same period.
    This marks the second consecutive year that EXFO has earned this prestigious industry Award.
    "EXFO has grown market share by maintaining investments in its strong R&D program, increasing its sales and marketing intensity, and expanding its global presence while preserving close relationships with its existing customer base," said Sujan Sami, Frost & Sullivan research analyst for the communication test sector.
    EXFO's market-share gains were largely captured in the fiber optic installation and maintenance (I&M) market, where the company has a leadership position. Among the impressive gains realized in 2004, EXFO grew its already significant sales level by more than 50% compared to 2003 in two key market segments: optical time domain reflectometry (OTDR) and optical loss test sets (OLTS).
    Not content to rest on its laurels, EXFO renewed its I&M product portfolio during the last 12 to 18 months with the release of several advanced and feature-rich solutions, including more than a half-dozen dedicated to the rapidly growing FTTx (fiber-to the-premises, fiber-to-the-curb, fiber-to-the-node) market.
    "EXFO not only registered significant market-share growth in multiple market segments of the optical test equipment industry in 2004, but it has consistently done so for the past several years," Sami added.
    As a result of those consistent strategies, EXFO moved from a 6.4% market share of the worldwide FOTE equipment market in 2001 to a 10.3% share in 2004. This represents the single largest increase among its peer group.
    Frost & Sullivan estimated the global FOTE equipment market to be at $614.4 million in 2004, including approximately $307.8 million for the I&M market.

    About EXFO

    EXFO (NASDAQ:EXFO) (TSX:EXF.SV) is a recognized test and measurement expert in the global telecommunications industry through the design and manufacture of advanced and innovative solutions as well as best-in-class customer support. The Telecom Division, which represents the company's main business activity, offers fully integrated and complete test solutions to network service providers, system vendors and component manufacturers in approximately 70 countries. One of EXFO's strongest competitive advantages is its PC/Windows-based modular platforms that host a wide range of tests across optical, physical, data and network layers, while maximizing technology reuse across several market segments. The Photonics and Life Sciences Division mainly leverages core telecom technologies to offer value-added solutions in the life sciences and high-precision assembly sectors. For more information about EXFO, visit www.exfo.com.

    About Frost & Sullivan

    Founded in 1961, Frost & Sullivan is recognized as a global leader in growth consulting. Frost & Sullivan Awards are presented to companies that demonstrate excellence in the industry through diligence, commitment, and innovative business strategies required to advance in the global marketplace. Frost & Sullivan rigorously analyzes specific criteria to determine Award recipients in a vast variety of market industries and landscapes. For further information, visit www.frost.com.

--30--BD/sa*

CONTACT: Frost & Sullivan, San Antonio Stacie Jones, 210-247-2450 sjones@frost.com www.frost.com

KEYWORD: CALIFORNIA TEXAS INDUSTRY KEYWORD: HARDWARE SOFTWARE TELECOMMUNICATIONS INTERNET E-COMMERCE PRODUCT SOURCE: Frost & Sullivan

Copyright Business Wire 2005