MERKO EHITUS

COMMENTARY TO FINANCIAL RESULTS



COMMENTARY TO CONSOLIDATED FINANCIAL RESULTS OF Q1 2000



The 3-months 2000 unaudited and consolidated net sales of Merko Ehitus 

group amounted to 210.3 million EEK, and net profit was 9.0 million EEK.  

The respective figures year ago were net sales of 155.9 million EEK and net 

profit of 6,2 million EEK.



The consolidated financial results of Merko Ehitus group include the results 

of parent company AS Merko Ehitus, and its 100% subsidiaries AS Gustaf 

(construction), SIA Merks (construction)in Latvia, UAB Merko Statyba 

(construction) in Lithuania, and 66% holding in subsidiary AS Merko Tartu 

(construction), and 65% holding in subsidiary OÜ Matek (production of small 

houses and timber construction). 



In addition to the subsidiaries, the profit figure of Merko Ehitus group also 

includes the results of the affiliated enterprises Normanni Linnagrupi AS 

(project management, 50% holding) and Vesimer Investeeringute AS 

(investments, project management and real estate development, 50% holding), 

AS Insenervõrgud (civil engineering, 50% holding) and AS Tartu Maja 

Betoontooted (production of concrete, 25% holding).



Financial ratios illustrating the activities of Merko Ehitus group in 

Q1 2000 were:

			      Q1 2000         Q1 1999 

Net profit margin		 4,3%		 4,0%

Operating profit margin		 4,4%		 5,7%

Return on equity (per year)	32,6%		15,8%

Return on assets (per year)	12,2%		 6,7%

Current ratio			 1,3		 1,4

Invoice turnover (per year)	 7,0		 7,4

Equity-to-assets ratio		36%		45%





The 3-months 2000 consolidated and unaudited income statement and balance 

sheet are compiled in accordance with the principles of the International 

Accounting Standards (IAS), and correspond with the Estonian legal acts 

regulating the accounting principles used.





Ülo Metsaots

Financial Director

+372 6 105 110