German website, Spiegel Online, has reported that Leica is in financial
crisis after many banks cut its credit lines following an announcement
last week, which said it stood to lose half its operating capital. The
company, which introduced the first 35mm still camera in 1924, is also
expected to close the financial year with an operating loss of €10
million (approx $13 million). Last year it reported a loss of €1.6
million (approx $2.1 million). Shareholders will hold a meeting on May
31 to discuss the future of the company. Spiegel Online says that Leica
has missed the boat where digital photography is concerned and it is
also suffering due to the low rate of the US dollar versus the Euro.

Press Release:

Following the ad hoc announcement of Leica Camera AG, Solms, of
February 17, 2005, stating that the Company expects a loss of half of
its registered share capital in March 2005, the banks have partially
terminated their credit lines. The remaining lines still cover the
current liquidity requirements. The Company's Board of Management has
entered into negotiations with the banks on a solution that will carry
the Company until the time of its Extraordinary General Meeting on May
31, 2005, at which capital measures are to be proposed to the
shareholders.

Press Release:

Leica Camera AG, Solms, expects the existence of a loss in the amount
of half of its registered share capital in March 2005. The Company's
Board of Management will make a corresponding announcement according to
section 92 (1) of the German Stock Corporation Law (AktG) at a General
Meeting to be held on May 31, 2005.

Concurrently, the Board of Management prepares a turnaround strategy.
It will propose at the General Meeting on May 31, 2005 that capital
measures be taken. In connection with such measures audits are
conducted at present. The measures proposed will be announced and
published in the designated journals at the time of the convening of
the General Meeting and the announcement of its agenda.

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