AS BALTIKA                       ANNOUNCEMENT                       07.09.2005



BALTIKA'S SALES IN AUGUST



The consolidated net sales of Baltika Group in August amounted to EEK 64.6

million, posting an increase of 18% compared with last year. Retail sales reached

EEK 43.8 million, growing 28% yoy. August posted very strong retail sales growth

due to the well timed launch and the successful start of the new season's

collections. In addition, overall monthly sales were supported by solid wholesale

sales that grew 16% yoy and reached EEK 19.9 million. Being traditionally a

strong wholesale month, wholesale sales represented almost one third of net sales

in August.



Due to the establishment of a joint venture on the basis of Baltika's production

unit Baltika Tailor OÜ in November 2004, the consolidated sales results do not

include subcontracting figures starting from December 2004. Thus, in comparable

terms, net sales of Baltika Group increased 24% yoy in August.



On the back of the strong sales results of this year Baltika raised the minimum

sales target for 2005 from EEK 620 million to EEK 640 million.



Sales figures in August



 EEK million        08/2005    08/2004    Change  

                                           

 Retail sales          43.8       34.2       28%     

 Wholesale             19.9       17.1       16%     

 Subcontracting           0        3.0     -100%   

 Other sales            1.0        0.2      405%    

 Total                 64.6       54.6       18%     





The sales of Baltika's fast fashion brand Monton accounted for 57% of the total

retail sales in August and amounted to EEK 25.1 million, up 34% on last year's

figure. The retail sales of CHR/Evermen grew 50% compared with the same period

last year, amounting to EEK 11.5 million and the sales of Baltman rose 8% yoy to

EEK 4.1 million.



While all the markets posted growth in sales, the best performing retail markets

in August were Latvia (+45% yoy), Estonia (+37%) and Ukraine (+30%).



In August, Baltika opened two new stores, both in Lithuania in Panevezys. Thus,

as of the end of the month, Baltika Group operates 78 shops with total sales area

of 11,577 m2. In September, we plan to open two new stores and relocate one

store. One opening takes place in Vilnius (Lithuania) and two in Tartu (Estonia)

in the new Tartu Kaubamaja shopping centre. All in all, Baltika is proceeding in

line with the earlier announced plans to open 10-12 new stores in the second half

of 2005.



Cumulative eight month sales of Baltika totalled EEK 428.8 million (+17% yoy),

including retail sales of EEK 336.3 million (+33%) and wholesale of EEK 83.2

million (-2%). Comparable net sales of the first eight months of this year

expanded 24% compared with previous year.



1 EUR = 15.6466 EEK





Triin Palge

Head of investor relations

+372 630 2886