Tallinna Sadam                FINANCIAL RESULTS                 08/16/2004



INTERIM REPORT, 6 MONTHS 2004



SUMMARY OF PERFORMANCE RESULTS



During the first half of 2004 19.36 m tons of cargo passed through the 

harbours of the Port of Tallinn, 1.6 m tons or 9.1% more than the same 

period last year.

The total cargo volume of the largest Baltic Sea east coast ports was 150 m

tons, a growth of 16.5%. Thus, the growth of cargo volume passing through 

the Port of Tallinn fell below the overall market growth in the region. In 

2004, as a result of new Russian port projects put into operation, a 

significant change in market shares took place. The market share of Russian 

ports increased to 43% (compared to 32% in 2003) whereas the market share of

Baltic State’s ports decreased. The change was mostly caused by redirection 

of crude oil and oil product flows into Russian ports. In terms of cargo 

volume growth the leading ports were Primorsk (up 13.5 m tons or 206%) and 

St.Peterburg (up 4.3 m tons 

or 24%). The cargo volume decreased in the ports of Butinge (1.2 m tons or 

21%), Ventspils (0.5 m tons or 4%) and Klaipeda (0.2 m tons or 2%).



The consolidated sales revenue of the Port of Tallinn for the first half of 

2004 was EEK 551 m (EUR 35.2 m), which is EEK 53 m (EUR 3.4 m) or 11% more 

than the sales revenue for the same period last year. Favourable ice 

conditions, the early start of fast boat season and record high prices of 

crude oil and oil products increased the number of ship arrivals by 30%. Due 

to the increased number of ship arrivals port dues increased by EEK 33 m 

(EUR 2.1 m) or 12%, cargo dues by EEK 11 m (EUR 0,7 m) or 12% and passenger 

dues by EEK 7 m (EUR 0.5 m) or 15%.



The consolidated operating expenses (excl. other expenses) comprised a total 

of EEK 237 m (EUR 15.2 m), a decrease of EEK 24 m (EUR 1.5 m) mainly related

to higher ice-breaking costs and one-time expenses arising from the increase

of minimum acquisition cost limit for fixed asset in 2003, a decrease in 

marketing and personnel expenses and decreased depreciation. As a result of 

increased sales revenue and decreased operating expenses the consolidated

operating profit (excl. other income/expenses) of the Port of Tallinn 

increased by EEK 76 m (EUR 4.9 m) up to EEK 313 m (EUR 20.0 m).



The consolidated net profit for the first half of 2004 was EEK 299 m (EUR 

19.1 m), which is EEK 226 m (EUR 14.4 m) or 307% more than for the same 

period last year. The increase in net profit is mainly the result of non-

refundable financing of ice-breaking works in 2003 in the amount of 

EEK 119 m (EUR 7.6 m), income tax on dividends declared in the amount of EEK 

47 m (EUR 3 m, because the

dividends payable from the 2003 net profit have not yet been declared, the

income tax expense for 2004 has not occurred) and increased operating 

profit. A

the mean time the total debt balance of the company has grown significantly 

and interest expenses increased, totalling EEK 14.1 m (EUR 0.9 m) during the 

first half of 2004.



During the first half of 2004 a total investments into fixed assets in the

amount of EEK 725 m (EUR 46.3) were made. Majority of the investments were

related to construction of new quays with supplementary infrastructure in 

Muuga harbour and Paldiski South harbour. In Muuga harbour the biggest 

projects were the construction of a coal terminal, a quay for container 

ships, railways and viaducts. In Paldiski South harbour new land area for 

port expansion was purchased, reconstruction of quay no.6 and dredging of 

port aquatory was performed.





INTERIM FINANCIAL STATEMENTS, in thousands, unaudited



BALANCE SHEET

                           30.06.2004 31.12.2003 30.06.2004 31.12.2003

in thousands                      EEK        EEK        EUR        EUR

ASSETS                                                                

CURRENT ASSETS                                                 

Cash and bank                 161 382    155 516     10 314      9 939

Shares and other               35 170     10 041      2 248        642

securities

Customer receivables           93 803     83 719      5 995      5 351

Other receivables and          41 121     73 934      2 628      4 725

prepayments

Inventories                     2 715      2 354        174        150

Total current assets          334 191    325 564     21 359     20 807

                                                               

NON-CURRENT ASSETS                                             

Other shares and                4 655      4 655        298        298

securities

Other long-term                14 763     14 762        944        943

receivables

Tangible fixed assets       5 160 658  4 563 763    329 826    291 678

Total non-current assets    5 180 076  4 583 180    331 067    292 919

                                                               

TOTAL ASSETS                5 514 267  4 908 744    352 426    313 726

                                                               

LIABILITIES AND OWNER’S                                               

EQUITY

LIABILITIES                                                    

Current liabilities                                            

Short-term part of long        69 540          0      4 444          0

term borrowings

Supplier payables             138 318    207 861      8 840     13 285

Taxes payable                  12 528     21 041        801      1 345

Payable to shareholders             0    100 000          0      6 391

Short-term provisions             283      1 222         18         78

Other payables                 35 163     39 268      2 247      2 510

Total current liabilities     255 832    369 392     16 351     23 608

                                                               

Non-current liabilities                                        

Long-term borrowings        1 047 489    725 866     66 947     46 391

Long-term provisions            3 426      3 426        219        219

Other long-term                17 995     17 997      1 150      1 150

liabilities

Total non-current           1 068 910    747 289     68 316     47 760

liabilities

                                                               

Total liabilities           1 324 742  1 116 681     84 666     71 369

                                                               

Minority interest               1 670      1 960        107        125

                                                               

OWNER’S EQUITY                                                 

Share capital at nominal    2 750 000  2 650 000    175 757    169 366

value

Statutory reserve             262 111    262 111     16 752     16 752

Hedge reserve                  -1 177          0        -75          0

Retained earnings             877 992    647 205     56 114     41 364

Profit for the year           298 929    230 787     19 105     14 750

Total owner’s equity        4 187 855  3 790 103    267 653    242 232

                                                               

TOTAL LIABILITIES AND       5 514 267  4 908 744    352 426    313 726

OWNER’S EQUITY







INCOME STATEMENT



                             6 months    6 months   6 months   6 months

                                 2004        2003       2004       2003

in thousands                      EEK         EEK        EUR        EUR

                                                                

Sales revenue                 551 091     498 521     35 221     31 861

Other income                    2 031      13 811        130        883

Operating expenses            105 938     120 606      6 771      7 708

Personnel expenses             57 319      62 303      3 663      3 982

Depreciation and               74 155      77 959      4 739      4 982

impairment

Other expenses                  2 254     129 486        144      8 276

OPERATING PROFIT              313 456     121 978     20 033      7 796

                                                                

Financial income and                                            

expenses

Interest expense              -14 126      -1 722       -903       -110

Foreign exchange gain             -51         -50         -3         -3

(loss)

Other financial income and       -640         133        -41          9

expense

Total financial income and    -14 817      -1 639       -947       -105

expenses

                                                                

Profit from ordinary          298 639     120 339     19 087      7 691

activities

Income tax                          0     -46 976          0     -3 002

Minority share                    290           0         19          0

NET PROFIT FOR THE PERIOD     298 929      73 363     19 105      4 689



Earnings per share              1,114       0,275      0,071      0,018





Erik Sakkov

Marketing Director

+372 631 8067