The board of directors at Italian manufacturer of leather-upholstered furniture Natuzzi S.p.A has agreed to a change in the unaudited consolidated financial statements approved by the board on March 29 reducing the company’s net loss. The change to the results lowers Natuzzi's net loss for the full year 2005 and fourth quarter 2005 to €14.6 million and €0.7 million respectively, from €16.7 million and €2.8 million as previously announced.

This reduction reflects the write-off of a €2.1 million prudential provision that was included in the group's unaudited financial statements in connection with the results of Italsofa Bahia, its Brazilian subsidiary. Following  the board meeting of March 29, the subsidiary received a communication from local authorities fully recognising its right to benefit from a corporate tax reduction.

In compliance with Italian accounting principles and Italian legislation, the board decided to write-off the  provision prior to the shareholders' meeting at the end of April, at which the 2005 financial results will be presented for approval.