In  1997,  compared  to  1996,  a/s  "Kaija"  turnover has increased by

approximately

28%,  and  amounts to LVL 14.6 million. The company experts believe the

1998 turnover to reach about 16.5

million LVL. A more efficient utilisation of production capacities;

reorganisation   company   business;  a  change  in  the  client  base;

investment  in technologies; and improvements in management system have

played  an  essential  role in the increase of turnover in the previous

year.

According  to  a/s  "Kaija" non-audited financial statements, the gross

profit for

1997 was LVL 2.6

million  (LVL 2.1 milllion in 1996); gross margin was 17,8%. Net profit

after   extraordinary  items  and  tax  will  be  announced  after  the

completion of the company audit by "Coopers & Lybrand".

In  1997 a/s "Kaija" has paid LVL 1.3 million in current taxes, and has

also  paid  off  146  thousand  LVL  of the tax arrears incurred by the

former state company prior to privatisation.

1997  has  been  a  year  of  successful  cooperation with customers in

Russia:  an  agreement  has  been reached on long-term cooperation with

regard to sales volumes and prices. Other export markets are developing

as  well - sales to Canada have started; contracts have been signed and

work  is  in progress with the aim to substantially increase exports to

the  Ukraine.  Last  year  72.31%  of  a/s "Kaija" sales went to export

markets, and 27.4% of produce was sold in domestic market. An agreement

has been reached with a/s "Salacgrīva 95" on doing the sales jointly.