Merko Ehitus                  FINANCIAL RESULTS                 08/05/2002



GROUP FINANCIAL RESULTS, 6M 2002



Merko Ehitus group 6M 2002 consolidated and unaudited net sales 

amounted to 668,6 million EEK (42,7 million EUR), and net profit was 

42,7 million EEK (2,7 million EUR).  

The respective figures year ago were net sales of 561,8 million EEK (35,9

million EUR) and net profit of 33,1 million EEK (2,1 million EUR).



Merko Ehitus group deals in the field of construction and with activities 

concerned to that, in Estonia, Latvia and Lithuania. Companies of the group

6M 2002 net sales and consolidated net sales (sales outside the group)

were (in thousand EEK):



								

                                                Net Sales       including

                                                             consolidated

                                                                net sales

Estonian companies			

	Construction	

	AS Merko Ehitus                         414 520         411 211

	AS Gustaf (100% partnership)             55 982          54 372

	AS Merko Tartu (66% partnership)         33 882          32 909

	Production of structures for small houses		

	OÜ Matek (71,6% partnership)             13 409          13 182

	Road construction

	Tallinna Teede AS (100% partnership)     48 993          47 210

	Construction

	AS Normanni Linnagrupp (50% partnership)    968               -

	AS Insenervõrgud (50% partnership)            -               -

	Production of concrete		

	AS Tartu Maja Betoontooted 

	(25% partnership)                        53 012               -

Latvian companies			

	Construction		

	SIA Merks (100% partnership)             51 552          51 552

Lithuanian companies			

	Construction		

	UAB Merko Statyba (100% partnership)     58 132          58 132



Companies of the group 6M 2002 net sales and consolidated net sales 

(sales outside the group) were (in thousand EUR):



                                             Net Sales       Including

                                                             consolidated

                                                             net sales

Estonian companies			

	Construction		

	AS Merko Ehitus                          26 493          26 281

	AS Gustaf (100% partnership)              3 578           3 475

	AS Merko Tartu (66% partnership)          2 166           2 103

	Production of structures for small houses		

	OÜ Matek (71,6% partnership)                857             843

	Road construction

	Tallinna Teede AS (100% partnership)      3 131           3 017

	Construction		

	AS Normanni Linnagrupp (50% partnership)     62               -

	AS Insenervõrgud (50% partnership)            -               -

	Production of concrete		

	AS Tartu Maja Betoontooted 

	(25% partnership)                         3 388               -

Latvian companies			

	Construction		

	SIA Merks (100% partnership)              3 295           3 295

Lithuanian companies			

	Construction		

	UAB Merko Statyba (100% partnership)      3 715           3 715



Merko Ehitus group 6M 2002 consolidated data illustrating financial ratios 

were:



                                              6M 2002             6M 2001 

Net profit margin                               6,4 %               5,9 %

Operating profit margin                         6,4 %               5,2 %

Return on equity (per year)                    35,5 %              38,1 %

Return on assets (per year)                    15,9 %              14,9 %

Current ratio                                   1,5                 1,6

Invoice turnover (per year)                     5,8                 9,8

Equity-to-assets ratio                         43,0 %              44,6 % 



Year 6M 2002 consolidated and unaudited income statement and balance sheet

are compiled in accordance with the principles of the International 

Accounting Standards (IAS), and correspond with the Estonian legal acts 

regulating the accounting principles used.





INCOME STATEMENT 6M 2002				

consolidated, unaudited in thousand EEK and EUR				

				

                                           EEK                   EUR	

                                   2002.a.     2001.a.    2002.a.    2001.a.

                                   6 months    6 months   6 months   6 months



Sales                              668 568     561 768     42 729     35 903

Cost of sales                      597 084     512 715     38 161     32 768



GROSS PROFIT                        71 484      49 053      4 569      3 135



Marketing expenses                   6 124       5 020        391        321

Administrative expenses             22 611      18 624      1 445      1 190

Other operating income               8 200       4 678        524        299

Other operating expenses             8 357       1 015        534         65



OPERATING PROFIT                    42 592      29 072      2 722      1 858



Financial income from stocks of 

associated companies                 1 125         656         72         42

incl. Equity method gains            1 125         656         72         42

Foreign exchange gain                1 191       4 285         76        274

Other interest and similar income    1 715       3 054        110        195



TOTAL FINANCIAL INCOME               4 031       7 995        258        511



Financial expenses related to 

associated companies                   352         929         22         59

incl. Equity method gains              352         929         22         59

Interest expense                       230          22         15          1

Foreign exchange loss                3 114       2 516        199        161

Other financial expenses                77          49          5          3



TOTAL FINANCIAL EXPENSES             3 773       3 516        241        225



PROFIT(-LOSS) FROM NORMAL OPERATIONS42 850      33 551      2 739      2 144

				

NET PROFIT (LOSS) FOR THE FIN. YEAR 42 850      33 551      2 739      2 144



Minority interest                      121         462          8         30



Net profit (- loss) for the group   42 729      33 089      2 731      2 115

				

Net profit (- loss) per share 

(basic and diluted, in EEK and EUR)   4,83        3,74       0,31       0,24





BALANCE SHEET AS OF 31.06.2002				

consolidated, unaudited in thousand EEK and EUR				



                                        EEK                      EUR	

                              30.06.2002   31.12.2001  30.06.2002  31.12.2001



ASSETS



Cash and cash equivalents         49 051       60 814       3 135       3 887



Marketable securities             16 681       18 516       1 066       1 183



Accounts receivable              231 917      186 861      14 822      11 943

Allowance for doubtful receivables   -38          -53          -2          -3

Total accounts receivable        231 879      186 808      14 820      11 939



Receivables from subsidiary and 

parent companies                       0        1 735           0         111

Receivables from associated comp.  7 375        6 941         471         444

Other short-term receivables      31 054       43 112       1 985       2 755

Total other receivables           38 429       51 788       2 456       3 310



Interest receivable                  598          739          38          47

Other accrued income                 261          254          17          16

Total accrued income                 859          993          55          63



Prepaid taxes                      4 732        6 850         302         438

Other prepaid expenses             3 451        1 534         221          98

Total prepaid expenses             8 183        8 384         523         536



Raw materials                      2 633        4 041         168         258

Work-in-progress                   2 755        9 092         176         581

Finished goods                     1 400          855          89          55

Merchandise purchased for resale  63 820       32 667       4 079       2 088

Prepayments to suppliers          16 079          567       1 028          36

Construction-in-progress           3 884        5 821         248         372

Due from customers                27 151       35 281       1 735       2 255

Total inventories                117 722       88 324       7 524       5 645



TOTAL CURRENT ASSETS             462 804      415 627      29 578      26 563



Shares in associated companies    11 514       12 489         736         798

Long-term receivables from 

associated companies                 529          100          34           6

Other shares, holdings and debt 

securities                         3 947        1 800         252         115

Miscellaneous longterm receivables10 039        7 588         642         485

Long-term accounts receivable         59            0           4           0

Total long-term financial assets  26 088       21 977       1 667       1 405



Land                                 696          797          44          51

Buildings                         23 390       26 934       1 495       1 721

Accumulated real-estate 

investments depreciation          -7 100       -6 755        -454        -432

Prepayments for real-estate 

investments                       14 261       10 655         911         681

Total real-estate investments     31 247       31 631       1 997       2 022



Land and buildings                 8 305       15 289         531         977

Ground lease                       6 718          458         429          29

Plant and equipment               65 527       64 064       4 188       4 094

Other equipment and fixtures      17 139       16 105       1 095       1 029

Accumulated depreciation         -47 198      -46 914      -3 016      -2 998

Self-constructed physical assets 

under construction                   162          173          10          11

Prepayments for noncurrent 

physical assets                       50            0           3           0

Total noncurrent physical assets  50 703       49 175       3 241       3 143

				

Purchased concessions, patents, 

licenses, etc.                        97           97           6           6

Goodwill                          -6 095       -6 773        -390        -433

Total intangible assets           -5 998       -6 676        -383        -427

				

TOTAL NON-CURRENT ASSETS         102 040       96 107       6 522       6 142

				

TOTAL ASSETS                     564 844      511 734      36 100      32 706

				



Debentures (except bank loans)    16 831        4 533       1 076         290

Short-term loans from financial 

institutions                           9            8           1           1

Total debt obligations            16 840        4 541       1 076         290



Customer prepayments              13 692        9 865         875         630

				

Accounts payable to suppliers    127 521      122 504       8 150       7 829

				

Payables to associated companies   2 245        1 493         143          95

				

Tax liabilities                   10 237       11 842         654         757



Payables to employees             12 151       10 165         777         650

Dividends payable                    795            0          51           0

Interest payable                      19           10           1           1

Other accrued expenses               695          941          44          60

Total accrued expenses            13 660       11 116         873         710

				

Provisions for construction 

warranty liability                 3 793        3 737         242         239

Due to customers                 113 327       94 572       7 243       6 044

Other current provisions             159          155          10          10

Total current provisions         117 279       98 464       7 495       6 293



TOTAL CURRENT LIABILITIES        301 474      259 825      19 268      16 606

				

Non-convertible debt               7 321          204         468          13

Accounts payable to suppliers      8 851        7 478         566         478



TOTAL NON-CURRENT LIABILITIES     16 172        7 682       1 034         491

				

TOTAL LIABILITIES                317 646      267 507      20 301      17 097



OWNERS' EQUITY				

Share capital                     88 500       88 500       5 656       5 656

Share premium                      2 950        2 950         189         189

Mandatory legal reserve            8 850        8 205         566         524

Retained earnings                 99 540       49 213       6 362       3 145

Net profit (- loss) for the 

financial year                    42 729       88 312       2 731       5 644

Exchange rate differences            452        1 218          29          78



TOTAL OWNERS' EQUITY             243 021      238 398      15 532      15 236

				

Minority interest                  4 177        5 829         267         373

				

TOTAL LIABILITIES AND OWNERS' 

EQUITY                           564 844      511 734      36 100      32 706





Ülo Metsaots

Management Board member

+372 6 105 110