03.11.2004, Tallinna Farmaatsiatehas, TLN

Tallinna Farmaatsiatehas        FINANCIAL RESULTS                       03.11.2004



FINANCIAL RESULTS 9M 2004



COMMENTS TO INCOME STATEMENT, 9M/2004



The 9 months 2004 net sales of Tallinna Farmaatsiatehas  amounted  to  49,548  th.

EEK (3,166 th. EUR). Compared to the same period of previous year the  sales  were

decreased by 3,353 th EEK (214 th. EUR) i.e. 6.3% (net turnover in 9  months  2003

52,901 th. EEK or 3,381 th.EUR).The operating income total decreased by 7,527  th.

EEK or 483 th EUR (14.1%).



Compared to the same period of previous year the total  operating  cost  decreased

by 8,373 th. EEK (535 th EUR) i.e. 16,6% (total operating  costs  in  2003  50,464

th. EEK (3,225 th.EUR) and in 2004 42,091 th. EEK (2,690 th.EUR)), from which  the

decrease of expenses for materials (expenses for materials in 2003 27,057 th.  EEK

(1,729 th. EUR) and in 2004 22,272 th. EEK (1,423 th.EUR))  4,784  th.EEK  or  306

th.EUR. Others operating expenses decreased by 1,957 th. EEK (125 th.EUR).



Operating profit increased in 9 months of 2004 compared (operating profit in  2003

2,880 th. EEK (184 th.EUR) and operating  profit  in  2004   3,725  th.  EEK  (238

th.EUR)) to the same period of 2003 by 845 th. EEK (54 th.EUR) (29.4 %).





COMMENTS TO BALANCE SHEET



As of September 30 2004 the Balance capacity was 62,028 th. EEK (3,964  th.  EUR).

Compared to the net balance, the biggest increase was in assets -receivables  from

parent company 15,078 th. EEK (963 th. EUR) (148.0%) and in finished  goods  stock

decreased with the sum 5,939  th.  EEK  (379  th.  EUR)  (74.7%).  Trading  assets

increased totally by 6,794 th. EEK (434 th.EUR) (27.4%).



In the liabilities the short-term liabilities increased 1,403 th. EEK (89  th.EUR)

(18.6%). Compared to the net balance, the biggest increase was  in  liabilities  -

accounts for payable 2,301 th. EEK  (147  th.EUR).  The  owners  equity  increased

3,652 th. EEK (233 th.EUR)) (7.6%) in the account of 9 months 2004 net profit.







BALANCE SHEET AS OF 30.09.2004    unaudited



in thousand EEK/EUR                       EEK                     EUR



                   30.09.2004 31.12.2003  30.09.2004 31.12.2003



A S S E T S



CURRENT ASSETS

Cash and bank accounts                 592    1,268         38       81

Customer receivables

    ACCOUNTS RECEIVABLE                 42    2,250          3      144

Other receivables

    RECEIVABLES FROM PARENT COMPANY 25,266   10,188      1,615      651

    OTHER SHORT-TERM RECEIVABLES       599      567         38       36

Total                               26,501   14,273      1,694      912



Inventories

    RAW MATERIAL                     2,735    2,428        174      155

    WORK-IN-PROGRESS                   320        0         20        0

    FINISHED GOODS                   2 007    7,947        128      508

    PREPAYMENTS TO SUPPLIERS             0      121          0        8

Total                                5,062   10,496        323      671



TOTAL CURRENT ASSETS                31,563   24,769      2,017    1,583



NON-CURRENT ASSETS



Long-term investments                  115      344          8       22



Fixed assets

FIXED ASSETS IN NET BOOK VALUE      29,967   31,172      1,915    1,992

Total                               29,967   31,172      1,915    1,992



Intangible assets                      382      555         23       35



TOTAL NON-CURRENT ASSETS            30,464   32,071      1,947    2,049



TOTAL ASSETS                        62,027   56,840      3,964    3,633





LIABILITIES AND SHAREHOLDERS' EQUITY



LIABILITIES

CURRENT LIABILITIES

    CURRENT PORTION OF

    LONG-TERM DEBT                       0        0          0        0

    SHORT-TERM BANK LOANS              180      741         11       47

    CUSTOMER PREPAYMENTS                 0        0          0        0

Total                                  180      741         11       47



Accounts payable                     7,140    4,839        456      309

Taxes payable                          226        0         14        0

Accrued expenses                     1,407    1,972         90      126



TOTAL CURRENT LIABILITIES            8,954    7,552        573      483



NON-CURRENT LIABILITIES

Long-term debt obligations

    BANK LOANS                       1,304    1,171        83        75

    PAYABLES TO PARENT COMPANY           0        0         0         0



TOTAL NON-CURRENT LIABILITIES        1,304    1,171        83        75



TOTAL LIABILITIES                   10,258    8,723       655       558



SHAREHOLDERS' EQUITY



SHARE CAPITAL                       12,500   12,500       799       799

RESERVES                             2,316    2,316       148       148

RETAINED EARNINGS

(ACCUMULATED DEFICIT)               33,301   23,073     2,128     1,475

PROFIT (LOSS) FOR FINANCIAL YEAR     3,652   10,228       233       654

SHAREHOLDERS' EQUITY TOTAL          51,769   48,117     3,309     3,075



LIABILITIES AND SHAREHOLDERS'

EQUITY                             62,028   56,840      3,964     3,633







INCOME STATEMENT, 9 M/2004   unaudited



in thousand EEK/EUR                             EEK              EUR

                                          2004     2003     2004    2003

REVENUE



NET SALES                                 49,548   52,901    3,167    3,381

CHANGE IN WORK-IN-PROGRESS AND

FINISHED GOODS INVENTORIES                -5,619   -2,945     -359     -188

OTHER OPERATING INCOME                     1,887    3,388      121      216

TOTAL REVENUE                             45,816   53,344    2,928    3,409



EXPENSES



MATERIALS, CONSUMABLES AND SUPPLIES      -22,272  -27,057   -1,423   -1,729

OTHER OPERATING EXPENSES                  -7,657   -5,913     -489     -377

PERSONNEL EXPENSES                        -8,562  -11,353     -547     -725



DEPRECIATION                              -2,773   -3,358     -177     -214

OTHER EXPENSES                              -825   -2,782      -52     -177



TOTAL EXPENSES                           -42,091  -50,464   -2,690   -3,225



OPERATING PROFIT (-LOSS)                   3,725    2,880      238      184



FINANCIAL INCOME/EXPENSES                    -73   25,786       -4    1,648



NET PROFIT (LOSS)                          3,652   28,666      233    1,832

EARNINGS (LOSS) PER SHARE                   2.92    22.93     0.18     1.46





Raivo Unt

financial director

6120201