17.08.2005, Tallinna Farmaatsiatehas, TLN

Tallinna Farmaatsiatehase AS           FINANCIAL RESULTS                17.08.2005



RESULTS 6 MONTHS 2005



COMMENTS TO INCOME STATEMENT, 6M/2005.



The 06 months 2005 net sales of Tallinna Farmaatsiatehas amounted  to  27,005  th.

EEK (1,726 th. EUR). Compared to the same period of previous year the  sales  were

decreased by 13,1177 th EEK (842 th. EUR) i.e. 32.8% (net turnover  in  06  months

2004 40,122 th. EEK  or  2.564  th.EUR).  The  operating  income  total  decreased

(operating income in 2004  33.827 th. EEK (2.162 th.EUR) and in  2005  24,955  th.

EEK (1,595 th.EUR) by 8,872 th. EEK or 567 th EUR (26.2%).





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

by 4,034 th. EEK (257 th EUR) i.e. 13.8% (total operating  costs  in  2004  29,221

th. EEK (1.867 th.EUR) and in 2005 25.187 th. EEK (1.610 th.EUR)), from which  the

decrease of operating expenses (in 2004 4,842 th. EEK (309 th. EUR)  and  in  2005

2,117 th. EEK (135 th.EUR)) 2,725 th.EEK or 174 th EUR (56.2%).



Operating profit decreased in 06 months of  2005  compared  (operating  profit  in

2004 4,606 th. EEK (295 th.EUR) and operating  loss  in  2005   233  th.  EEK  (15

th.EUR)) to the same period of 2004 by 4,839  th.  EEK  (309  th.EUR)  ,  and  net

profit decreased (net profit in 2004 4,560 th. EEK (292 th.EUR) and  net  loss  in

2005 230 th. EEK (15 th.EUR)) by 4,790 th. EEK (307 th. EUR).





COMMENTS TO BALANCE SHEET



As of June 30. 2005 the Balance capacity  was  55,764  th.  EEK  (3,564  th  EUR).

Compared to the net balance, the biggest decrease was  in  inventories  3,064  th.

EEK (195 th. EUR) (65.8%) and receivables from parent company  decrease  with  the

sum 1,666 th. EEK (106 th.EUR) (6.3%). Trading assets decreased totally  by  1,859

th. EEK (119 th.EUR) (6.9%).

In the liabilities  the  short-term  liabilities  decreased  5,879  th.  EEK  (375

th.EUR) (58.1%). Compared  to  the  net  balance,  the  biggest  decrease  was  in

liabilities - accounts payable 5,318 th. EEK (340  th.EUR)  (72,7%).  The  owners'

equity decreased 230 th. EEK (15 th.EUR)) (0.4%) in the account of 06 months  2005

net loss.







BALANCE SHEET AS OF 30.06.2005    unaudited



in thousand EEK/EUR                       EEK                     EUR



                             31.12.2004 30.06.2005  31.12.2004 30.06.2005



A S S E T S



CURRENT ASSETS

Cash and bank accounts                 308      404         19       26

Customer receivables

    ACCOUNTS RECEIVABLE                 16       38          1        2

Other receivables

    RECEIVABLES FROM PARENT COMPANY 26,270   24,605      1,679    1,572

    OTHER SHORT-TERM RECEIVABLES       480      166         30       10

Total                               27,074   25,214      1,730    1,611



Inventories

    RAW MATERIAL                     2,321    1,419        148       90

    WORK-IN-PROGRESS                   108        0          7        0

    FINISHED GOODS                   2 224      170        142       10

    PREPAYMENTS TO SUPPLIERS             0        0          0        0

Total                                4,654    1,590        297      101



TOTAL CURRENT ASSETS                31,728   26,804      2,028    1,713



NON-CURRENT ASSETS



Long-term investments                  105        0          7        0



Fixed assets

FIXED ASSETS IN NET BOOK VALUE      29,648   28,660      1,894    1,831

Total                               29,648   28,660      1,894    1,831



Intangible assets                      392      299         25       19



TOTAL NON-CURRENT ASSETS            30,146   28,959      1,927    1,850



TOTAL ASSETS                        61,874   55,764      3,954    3,564





LIABILITIES AND SHAREHOLDERS' EQUITY



LIABILITIES

CURRENT LIABILITIES

    CURRENT PORTION OF

    LONG-TERM DEBT                       0        0          0        0

    SHORT-TERM BANK LOANS              767      393         49       25

    CUSTOMER PREPAYMENTS                 0        0          0        0

Total                                  767      393         49       25



Accounts payable                     7,317    1,999        467      128

Taxes payable and accrued expenses   2,028    1,841        129      117



TOTAL CURRENT LIABILITIES           10,114    4,233        646      270



NON-CURRENT LIABILITIES

Long-term debt obligations

    BANK LOANS                         536      536        34        34

    PAYABLES TO PARENT COMPANY           0        0         0         0



TOTAL NON-CURRENT LIABILITIES          536      536        34        34



TOTAL LIABILITIES                   10,650    4,769       680       304



SHAREHOLDERS' EQUITY



SHARE CAPITAL                       12,500   12,500       799       799

RESERVES                             2,316    2,316       148       148

RETAINED EARNINGS

(ACCUMULATED DEFICIT)               36,407   36,407     2,326     2,326

PROFIT (LOSS) FOR FINANCIAL YEAR         0     -230         0       -15

SHAREHOLDERS' EQUITY TOTAL          51,223   51,935     3,274     3,259



LIABILITIES AND SHAREHOLDERS'

EQUITY                             61,874   55,764      3,954     3,564







INCOME STATEMENT, 6 M/2005   unaudited



in thousand EEK/EUR                             EEK              EUR

                                          2004     2005     2004    2005

REVENUE



NET SALES                                 40,122   27,005    2,564    1,726

CHANGE IN WORK-IN-PROGRESS AND

FINISHED GOODS INVENTORIES                -7,947   -2,162     -508     -138

OTHER OPERATING INCOME                     1,652      111      106        7

TOTAL REVENUE                             33,827   24,955    2,162    1,595



EXPENSES



MATERIALS, CONSUMABLES AND SUPPLIES      -15,344  -15,020     -981     -960

OTHER OPERATING EXPENSES                  -4,842   -2,117     -309     -135

PERSONNEL EXPENSES                        -6,423   -6,364     -410     -407



DEPRECIATION                              -1,841   -1,539     -118      -98

OTHER EXPENSES                              -771     -147      -49      -10



TOTAL EXPENSES                           -29,221  -25,187   -1,867   -1,610



OPERATING PROFIT (-LOSS)                   4,606     -233      295      -15



FINANCIAL INCOME/EXPENSES                    -46        3       -3        0



NET PROFIT (LOSS)                          4,560     -230      292      -15

EARNINGS (LOSS) PER SHARE                   3.65    -0.18     0.23    -0.01





Raivo Unt

financial director

+372 6120 201