Tallinna Kaubamaja            FINANCIAL RESULTS                 08/14/2003



FINANCIAL RESULTS FOR 6 MONTHS 2003



The consolidated unaudited net sales of Tallinna Kaubamaja Group for the 6

months of 2003 were 791.2 million kroons (50.6 million euros). The net sales

of the comparable period of last year were 712 million kroons (45.5 million

euros). The net sales increased by 11 per cent.



The consolidated unaudited net sales of the Group for Quarter 2 were 426.5

million kroons (27.3 million euros) that is 14 per cent higher than the net

sales of the same period last year when the net sales were 373.9 million

kroons (23.9 million euros).



The average sales area in the 6 months of 2003 was 31 858 sq m and within

the same period last year 26 123 sq m, constituting an increase of 22 per

cent.



The consolidated net profit of the Group for the 6 months of 2003 was 13.1

million kroons (0.8 million euros). The net profit was a decrease of 10.2

million kroons (0.7 million euros) over the comparable period last year when

the profit of the Group was 23.3 million kroons (1.5 million euros).



The consolidated net profit of the Group for Quarter 2 of 2003 was 14.2

million kroons (0.9 million euros) that is practically identical to the net

profit of the same period last year when the profit was 14.4 million kroons

(0.9 million euros).



Of various types of costs the highest increase was seen in advertising and

marketing costs: an increase of 1.6 times in the Group including a 2.2 times

increase in Selver chain. Intensive communication of the repositioning has

led to a considerable change in the price level perception of the chain that

is showing good results: the net sales of Selver increased by 19 per cent in

Quarter 1, 26 per cent in Quarter 2 and 46 per cent in July. The number of

purchases increased by 1,6 times. The widened assortment of the Selver

Couisine and orientation towards selling local goods has also had a positive

effect on the increase of the net sales.



Tallinna Kaubamaja is making preparations for opening a renewed department

store in 2004, expanding to the Viru Shopping Centre. The location and

assortment of departments has been finalized, the interior design project is

under way and in autumn preparations will be made for recruitment and

training of new staff. 120 new jobs will be created.



On August 27 Tallinna Kaubamaja will open a fashion store for every member

of the family in Rocca al Mare Shopping Centre. The expected number of

entrants is 250 000 people annually.



Tartu Kaubamaja continues to work on its expansion project whereby the

present sales area will be increased three-fold. By order of Tallinna

Kaubamaja Kinnisvara (Tallinna Kaubamaja Real Estate) architectural design

of the new shopping centre in so-called Hansa Quarter is being worked out.

Tartu Kaubamaja will be the anchor tenant of the centre.



Kaubamaja is transforming: several expansion projects are under way, brand

portfolio will be considerably wider - an example of new brands being Mexx,

B-Young, PTA and Soya; visual merchandising and sales conception are being

redesigned. It became indispensable to change the visual identity and logo

of Kaubamaja. The new logo is more inspiring than the previous one and

creates emotions. One of the main colours is orange that creates a friendly

and pleasant atmosphere, contributing to the target of Kaubamaja to

transform shopping into entertainment and pleasant experience.





TALLINNA KAUBAMAJA AS

Consolidated unaudited balance sheet

                    in thousands of EEK/EUR

                    6 m. 2003         6 m. 2002         31.12.2002

                    The Group         The Group         The Group

 ASSETS                EEK      EUR      EEK      EUR      EEK       EUR

Current assets

Cash and bank          32 083    2 050   27 832    1 779    34 258    2 189

Trade receivables       4 626      296    2 793      179    10 250      655

Other receivables       3 399      217    3 295      211     3 454      221

Accrued income             94        6       85        5        98        6

Prepaid expenses        1 437       92    5 537      354     7 611      486

Inventories           161 864   10 345  170 364   10 888   163 442   10 446

Total current assets  203 503   13 006  209 906   13 415   219 112   14 004

Non-current assets

L-T financial assets

Shares of assoc. co.    4 555      291    3 317      212     3 943      252

Long-t receivables f   12 028      769   12 028      769    12 028      769

Total L-T fin. ass.    16 583    1 060   15 345      981    15 971    1 021

Tangible fixed ass.   530 687   33 917  502 446   32 112   542 744   34 688

Intangible assets      -1 173      -75   -1 549      -99    -1 549      -99

Total L-T assets      546 097   34 902  516 243   32 994   557 331   35 620

TOTAL ASSETS          749 600   47 908  726 149   46 409   776 443   49 624



LIABILITIES AND

OWNERS’ EQUITY

Debt liabilities       59 070    3 775  142 076    9 080    76 192    4 870

Customer prepaym.       1 426       91      717       46     3 648      233

Supplier payables     110 271    7 048   80 672    5 156   148 158    9 469

Other payables         26 673    1 705   20 436    1 306    28 739    1 837

Total current liab.   197 440   12 619  243 900   15 588   256 737   16 408

L-T debt liabilities  169 833   10 854  127 936    8 177   143 663    9 182

Total non-curr liab   169 833   10 854  127 936    8 177   143 663    9 182

Kokku kohustused      367 273   23 473  371 836   23 765   400 400   25 590

Total liabilities

Owners’ equity         67 882    4 338   67 882    4 338    67 882    4 338

Share capital           7 269      465    7 269      465     7 269      465

Statutory reserve     154 447    9 871  158 727   10 145   156 490   10 002

Retained earnings     139 658    8 926   97 153    6 209    99 390    6 352

Profit for the per.    13 072      835   23 282    1 488    45 012    2 877

Total equity          382 327   24 435  354 313   22 645   376 044   24 034

TOTAL LIAB. AND

OWNERS’ EQUITY        749 600   47 908  726 149   46 409   776 443   49 624



TALLINNA KAUBAMAJA AS

Consolidated unaudited profit and loss statement

                    in thousands of EEK/EUR

                      2003              2002               2002

                    6 months          6 months          12 months

                    The Group         The Group         The Group

                       EEK      EUR      EEK      EUR      EEK       EUR

Operating income

Net sales             791 199   50 567  712 044   45 508 1 532 325   97 933

Other op. income       22 780    1 456   17 967    1 148    41 689    2 664

Total op. income      813 980   52 023  730 011   46 656 1 574 014  100 598

Operating expenses

Cost of goods sold   -599 388  -38 308 -530 710  -33 919-1 147 961  -73 368

Other op. expenses    -93 266   -5 961  -78 663   -5 027  -177 111  -11 319

Personnel expenses    -68 114   -4 353  -64 256   -4 107  -130 413   -8 335

Depreciation          -29 073   -1 858  -26 186   -1 674   -54 989   -3 514

Depreciation of FA    -29 284   -1 872  -26 351   -1 684   -55 319   -3 536

Depr. of  goodwill        211       14      165       11       329       21

Other expenses         -6 112     -391   -2 903     -186    -8 168     -522

Total op. expenses   -795 953  -50 871 -702 718  -44 912-1 518 643  -97 059

Operating profit       18 027    1 152   27 292    1 744    55 371    3 539

Financial income        1 166       75    1 570      100     3 208      205

Fin. inc. on shares

in subsidiaries           612       39      473       30     1 099       70

Interest income           555       35    1 097       70     2 109      135

Financial expenses     -6 121     -391   -5 581     -357   -13 566     -867

Interest expenses      -6 109     -390   -5 512     -352   -13 397     -856

Other fin. expenses       -12       -1      -69       -4      -169      -11

Net profit             13 072      835   23 282    1 488    45 012    2 877





Katrin Mühls

CFO

6 673 200