SAKU ÕLLETEHASE AS       FINANCIAL RESULTS          28.02.2005



Commentary for financial results of IV quarter, 2004

                                                              

BALANCE SHEET                                                 

(In thousands)                      EEK               €

                               31.12.   31.12.  31.12.   31.12.

                                2004     2003    2004     2003

                                                           

ASSETS                                                        

 Cash and bank balances       36,461   22,023   2,330    1,408

 Trade receivables (Note 2)   43,319   35,308   2,768    2,256

 Other receivables and         6,766    5,282     432      337

prepayments (Note 3)

 Inventories (Note 4)        109,674  113,652   7,009    7,264

TOTAL CURRENT ASSETS         196,220  176,265  12,539   11,265

                                                              

Non-current assets                                            

 Long-term financial          11,029   12,705     707      813

investments (Note 5)

 Property, plant and         239,295  245,843  15,293   15,712

equipment (Note 6)

 Intangible assets (Note 7)      596      719      38       46

TOTAL NON-CURRENT ASSETS     250,920  259,267  16,038   16,571

                                                              

TOTAL ASSETS                 447,140  435,532  28,577   27,836

                                                              

LIABILITIES AND EQUITY                                        

Current liabilities                                           

 Debt obligations (Note 8)       140      907       9       58

 Trade payables               16,266   12,226   1,039      782

 Other payables (Note 13)        471    4,600      30      294

 Tax liabilities (Note 9)     23,314   15,809   1,490    1,010

 Payables to employees         3,095    4,288     198      274

 Other accrued expenses        3,078    1,599     196      102

 Provisions (Note 10)         24,636   29,582   1,575    1,891

TOTAL CURRENT LIABILITIES     71,000   69,011   4,537    4,411

                                                              

Non-current liabilities                                       

 Finance lease liabilities                419               27

(Note 8)

TOTAL NON-CURRENT                         419               27

LIABILITIES

                                                              

Equity (Note 11)                                              

 Share capital                80,000   80,000   5,113    5,113

 Compulsory capital reserve    8,000    8,000     511      511

 Other reserves               44,070   44,070   2,817    2,817

 Retained earnings           194,032  179,262  12,401   11,457

 Profit for the period        50,038   54,770   3,198    3,500

TOTAL EQUITY                 376,140  366,102  24,040   23,398

                                                              

TOTAL LIABILITIES AND EQUITY 447,140  435,532  28,577   27,836

  

  



Q4 INCOME STATEMENT                                         

(In thousands)                       EEK                €

                                 Q4       Q4       Q4      Q4

                                2004     2003     2004    2003

                                                                

Revenue                                                         

 Sales revenue                 114,838   93,339   7,339    5,966

 Other revenue                     151      340      11       22

Total revenue                  114,989   93,679   7,350    5,988

                                                                

Expenses                                                        

 Change in work in progress      1,476    7,201      94      461

and finished goods

inventories

 Materials, consumables and     52,343   37,495   3,345    2,396

services

 Other operating expenses       28,696   20,890   1,835    1,335

 Personnel expenses             13,844   13,986     885      894

 Depreciation and               12,276   11,886     785      760

amortisation charges

 Other expenses                    962      831      61       54

Total expenses                 109,597   92,289   7,005    5,900

                                                                

OPERATING PROFIT                 5,392    1,390     345       88

                                                                

 Financial income and              168      121      10        8

expenses

                                                                

Q4 NET PROFIT                    5,560    1,511     355       96

                                                                

Basic earnings per share          0.70     0.19    0.04     0.01

Diluted earnings per share        0.70     0.19    0.04     0.01



Review of operations and performance



In Q4 2004 beverage sales by Saku Õlletehase AS totalled

15.5 litres, 3.3m litres or 27% up on the same period in

2003. Revenues amounted to EEK 115.0m (€7.4m), an EEK

21.3m (€1.4m) or 22.7% increase on a year ago. The growth

in sales resulted largely from enhanced sales of beer and

other alcoholic beverages.



According to Estonian Breweries Association, at the end of

Q4 the accumulated market share of Saku Õlletehase AS was

41.6%. The Estonian beer market grew 16% compared to the

same period in 2003. The main growth driver was beer in

PET whose market share increased significantly. Growth was

also facilitated by an increase in purchases by Finnish

tourists after Estonia’s accession to the EU.

Saku Õlletehase AS’ Q4 market share was 42.2% against

41.4% in 2003. Market share improved primarily on account

of shrinkage in the share of imports (2004: 4.3%; 2003:

7.5%), and expansion in the premium segment prompted by

successful sales of beer brands Carlsberg and Saku Valge.



Expenses totalled EEK 109.6m (€7.0m), EEK 17.3m (€1.1m) or

18.8% up on Q4 2003. The largest growth occurred in the

cost of materials, consumables and supplies, mostly due to

an increase in sales of products in one-way packaging. In

addition, the growth in operating volumes triggered an

increase in transport expenses.



Saku Õlletehase AS ended Q4 with operating profit of EEK

5.4m (€0.3m), an EEK 4.0m (€257,000) improvement on a year

ago. Net profit for the period amounted to EEK 5.6m

(€0.4m) against the EEK 1.5m (€0.1m) earned in Q4 2003.







FINANCIAL RATIOS                      January - January -

                                      December  December

                                        2004      2003

                                                

Operating margin (operating profit  /     12.1%     13.7%

total revenue)

Net   margin  (net  profit  /   total      9.4%     11.8%

revenue)

Return   on  assets  (net  profit   /     11.3%     12.6%

average total assets)

Return   on  equity  (net  profit   /     13.5%     15.3%

average equity)

Fixed  asset  turnover  ratio  (total       2.1       1.7

revenue / average fixed assets)

Total  assets  turnover ratio  (total       1.2       1.1

revenue / average total assets)



Kristina Seimann

Communication Manager

+372 6508 303

 Manager

+372 6508 303