PRO KAPITAL

COMMENTARY TO FINANCIAL RESULTS



COMMENTARY TO GROUP FINANCIAL RESULTS, Q1 2000



The Q1 2000 consolidated and unaudited balance sheet, income 

statement and commentary to the financial results of AS Pro Kapital, 

published via the information system of the Tallinn Stock Exchange on 

15.05.2000, include the unaudited results of the group's parent 

company and subsidiaries.



The group consolidated financial reports are compiled in line with 

principles of International Accounting Standards (IAS).  

Consolidated financial reports include the results of companies, 

where AS Pro Kapital holds at least 20% of shares or votes 

represented with shares.



Consolidated financial reports include the results of subsidiaries OÜ 

Nurmelin, OÜ Ilmarise Kvartal, OÜ Ermekta, AS Tondi Kvartal, AS Pro 

Haldus, AS Vinkrist and Latvian and Lithuanian subsidiaries.



In Q1 2000 AS Pro Kapital consolidated net sales totaled EEK 51 

million, incl. parent company's turnover EEK 3 million, OÜ Ilmarise 

Kvartal turnover EEK 24 million, OÜ Nurmelin turnover EEK 12 million, 

Pro Kapital Latvia consolidated turnover EEK 9 million and turnover 

from other subsidiaries EEK 3 million.



The group's consolidated net sales figure reflect the sales prices of 

real estate objects for which notarial sales agreements have been 

made, real estate rental services, real estate related consultations 

and management and administration services. The turnover figure also 

reflects the sales prices of real estate objects sold under finance 

lease agreements.  



The Q1 net sales figure does not include the preliminary real estate 

sales agreements under EEK 20 million, as stipulated in the company's 

accounting principles.



In Q1 2000 AS Pro Kapital Grupp consolidated loss amounted to EEK 0.8 

million. The result of the group's parent company and Estonian 

subsidiaries is lower by amortization of goodwill in the amount of 

EEK 2.5 million, shown on the income statement account of general 

administrative expenses under principles of IAS.

Compared with Q1 1999 the group's financial expenses are up by EEK 

5.2 million, mainly due to interest calculated on bonds issued by the 

parent company and interest paid on loans taken by Latvian 

subsidiary. Among the Estonian subsidiaries, OÜ Nurmelin earned 

profit in the amount EEK 3.3 million. The Latvian group ended Q1 2000 

at EEK 0.8 million profit and Lithuanian group at EEK 0.1 million profit. 

Subsidiaries that own real estate objects in developmental stage and 

thus does not have income from sales to cover operating expenses also 

had a negative effect on the consolidated result. 



At 31.3.2000 AS Pro Kapital consolidated balance sheet volume 

amounted to EEK 1.064 billion. No substantial changes have taken 

place since 31.12.1999.





Ilona Saari

CFO, Pro Kapital

+372 6144920