PRO KAPITAL

ANNOUNCEMENT



PROFIT WARNING



According to preliminary, unaudited data, Pro Kapital Group earned 

EEK 73.9 Mio net profit in year 2000 on a consolidated basis. The 

profit forecast published by the company for year 2000 was 

EEK 120 million.



The actual result was lower than forecasted due to the following:



1) the sales of AS Pro Kapital Eesti and Ilmarise Kvartal OÜ were 

lower than forecasted, due to which the company earned EEK 11 

million less profit.



2) additional financial expenses of Kristiine Kaubanduskeskus in the 

amount of EEK 2 million due to bank fees from refinancing of loans.



3) additional loss of EEK 2 million from Rottermanni Kvartal due to 

revaluation of EVP (privatization voucher) denominated liabilities.



4) the result of Pro Kapital Latvia Group was EEK 9 million lower 

than forecasted, since the preliminary agreements based sales 

transactions were not treated as sales in accounting due to 

insufficient prepayment (at least 80% of sales price).



5) EEK 3 million loss posted by Pro Kapital Vilnius Group (forecasted 

zero-profit), due to late completion of Didzioi project and overly 

optimistic preliminary sales forecasts.



6) EEK 4 million profit from Domina Vacanze subsidiary concern 

instead of EEK 24 million as forecasted, due to replacement of the 

concern’s accounting principles from Italian GAAP to International 

Accounting Standards.



Pro Kapital Group will publish its financial results for 

year 2000 and comments to the results by 20.03.2001.





Ilona Saari

Board member, PK Group

+372 614 4924