TALLINNA KAUBAMAJA AS

ANNOUNCEMENT

12.02.99

 

 

PRELIMINARY FINANCIAL RESULTS 12/98

 

The 1998 gross profit of Tallinna Kaubamaja AS, consolidated row-

by-row, reached the level of 1 billion EEK. Compared with the 

respective figures of last year, gross profit increased by 13.3%; 

compared with the initial forecast, the actual turnover was 3% 

lower. 

 

According to unaudited data, the group’s gross profit amounted to 

8 million EEK, of which:

			

                           Forecast		Actual		

Retail sales in Estonia	   39.6			 29.9	

Retail sales in Finland	  -18.1			-15.8

Rävala Parking house	   -1.4			-1.5

Share option					-4.6

					

The unaudited gross profit turned out to be 7.5 million EEK less 

than forecasted.

 

Due to seasonal dependency of retail sales, the main emphasis on 

earning the profit was set on the IV quarter of the economic 

year. Since extensive renovation works took place in the main 

building of Kaubamaja from June to August, then the largest share 

of profit was planned to earn in the IV quarter. By that time, 

the economic growth in Estonia had decelerated, bringing along 

unavoidable processes, which also had a significant influence on 

customer behavior, replacing consumption with saving. According 

to the information from the Statistical Office, the total volume 

of IV quarter retail sales of the country was ca 10% less than 

during the respective period in 1997 (October 14%; November 11%; 

December 8%). Decreasing turnover had also a negative effect on 

profit. The other factor influencing the amount of profit earned 

was the decision to carry the formation and organization costs of 

Kadaka Selver (initially planned to capitalize) in the amount of 

3 million EEK to the account of operating expenses. This decision  

will also decrease the expenses of future periods of Kaubamaja. 

The profit forecast anticipated that by the end of 1998, Tallinna 

Kaubamaja AS has acquired lacking 26% of the Tartu Kaubamaja AS 

shares. Presently the negotiations with Tartu Tarbijate Ühistu to 

purchase the respective shares are in progress. 

 

 

Urmo Vallner

Member of the Management Board

+372 640 0200