Tallinna Sadam                FINANCIAL RESULTS                 08/22/2003



INTERMEDIARY RESULTS, 6 MONTHS 2003



Performance results



In the first half-year of 2003, 19.05 m tonnes of cargo passed through the 

harbours of the Port of Tallinn, which compared to the same period last year 

is by 0.1% more. Compared to the change in cargo volume of the other Baltic 

Sea east coast ports the Port of Tallinn surpassed other ports with a larger 

cargo volume: St. Petersburg    -4.3% (a total of 17.9 m tonnes) and 

Ventspils -9.9% (a total of 15.5 m tonnes), but lagged behind the cargo 

volume growth of smaller ports: Riga +18.3% (a total of 10.5 m tonnes), 

Klaipeda +9.3% (a total of 10.7 m tonnes) and Primorsk +6.5% (a total of 

0.5 m tonnes).

The financial results of the first half-year in 2003 were negatively 

influenced by the most difficult ice conditions of the past ten years, 

which accompanied by a lasting cold substantially hindered the reception of 

vessels in the ports by the Gulf of Finland. In addition to this, loading of 

liquid cargo was also complicated due to cold weather, which impaired the 

throughput capacity of the loading pipelines and shortened the possible 

carriage laytime due to the danger of oil products freezing. Despite 

difficult winter navigation conditions all main cargo groups passing through 

the Port of Tallinn, except for liquid cargo, increased (general cargo by 

16.1%, bulk cargo by 13,3% and containers by 12.8%).



The 2003 first half-year net turnover was EEK 498.5 m (EUR 31.9 m), 

remaining on almost the same level compared to the same period last year, 

an increase of 0.3%. By revenue type, revenue from port dues has remained 

on the level of the last year, amounting to EEK 268.6 m (EUR 17.2 m) and 

54% of net turnover. Rental income increased by 19% and the sale of services 

by 2.8%, which both comprised 9% of net turnover. The increase in rental 

income is related to the realization of new projects in the harbours 

(mainly rental income from buildings and facilities and payment for a right 

of superficies). Increase in the sale of services was largely influenced by 

increased electricity consumption due to cold winter. Cargo charge and 

passenger fee decreased, by -4.3% and -5.8% respectively. The decrease in 

cargo charge was mainly caused by the harmonisation of cargo charge tariffs 

established for private operators in the end of 2002. Passenger fee decreased

 due to the decrease in the number of passengers (mainly due to the delay of 

the fast boat season on Tallinn-Helsinki line caused by difficult ice 

conditions) as well as due to changes in the passenger fee tariffs.



Despite the small increase in revenues, operating profit decreased by 55% 

from last year's level to EEK 122 m (EUR 7.8 m) - mainly due to an 

exceptionally large ice breaking cost.

Cold winter and difficult ice conditions increased the expenses of the 

Port of Tallinn by the cost of ice breaking work for the ensuring of access 

to the harbours by a total of EEK 127.3 m (EUR 8.1 m), from which the port 

financed ice breaking work in cooperation with cargo operators in the amount 

of EEK 8 m (shown as an expense for services purchased). EEK 88.3 m (in 

addition to this income tax expense in the amount of EEK 31 m or a total of 

EEK 119 m is shown as other expenses) was allocated to Estonian Maritime 

Administration for the organization of ice breaking work. Dividends paid to 

the owner by the Port of Tallinn from the profit of the 2002 financial year 

were decreased by the amount spent on the financing of state ice breaking, a 

total of EEK 119 m.



Expenses for materials, consumables and supplies increased by EEK 17 m (an 

increase of 42.5%). Here growth was mainly caused by the aforementioned ice 

breaking expense in the amount of EEK 8 m and increased electricity 

consumption in the harbours by EEK 5.5 m.



Miscellaneous operating expenses increased by EEK 20.4 m (an increase of 47%)

Larger changes were related to an increase in the repair expense of tangible 

fixed assets by EEK 7.7 m, income from the collecting of the doubtful 

receivable shown last year in the amount of EEK 6.9 m and an increase of land

tax in Muuga Harbour by EEK 3.4 m.



Compared to the same period last year, personnel expenses together with taxes

decreased by EEK 3.2 m or 4.9% mainly due to the decrease in the number of 

employees.

The first half-year expenses also include an income tax expense in the amount

of EEK 46.98 m, which was incurred in relation to the declaring of dividend 

payment from last years' profit in the amount of EEK 133.7 m (EUR 8.5 m).



The 2003 first half-year net profit was EEK 73.4 m (EUR 4.7 m), which 

compared to the last year is by EEK 200 m less. Here the one-time or 

extraordinary nature of the expenses decreasing the revenues in the first 

half-year and the levying of income tax on dividends due to the changes in 

the legal environment should be considered.



During the first half-year a total of EEK 187.5 m (EUR 12 m) was invested 

into tangible fixed assets. Mostly the investments were directed for the 

construction of new quays and acquisition of land in Paldiski South Harbour 

and Muuga Harbour with the goal of increasing the volume of different cargo 

types and ensuring the competitiveness of  the Port of Tallinn.



On 29 January 2003, the decreasing of the share capital of the Port of 

Tallinn by 10 000 000 shares (in the total nominal value of EEK 100 m), 

in accordance with the extraordinary general meeting of the shareholders held

on 19 August 2002, was registered on the B-part of the register card of the 

Commercial Register in the register department of Tallinn City Court. 

The goal of decreasing of the share capital was the performing of a 

non-monetary disbursement in the total value (EEK 100 m) to the Republic of 

Estonia by the transfer of the assets of Paljassaare Harbour. 

As of the preparing of the report the transfer of assets has not been 

performed. During the first half-year the turnover of Paljassaare Harbour 

constituted 7% of the total company turnover, hence the decrease in revenues 

due to the transfer of aforementioned assets does not have a significant 

impact on future company turnover.



BALANCE SHEET, UNAUDITED, IN THOUSANDS



ASSETS                                       EEK                  EUR

                                       30.06.03  31.12.02  30.06.03  31.12.02

CURRENT ASSETS

Cash and bank                            49 752    42 533     3 180     2 718

Shares and other securities              31 618    17 894     2 021     1 144

Customer receivables                    105 135    87 414     6 719     5 587

Other short term receivables              2 655       612       170        39

Prepaid and refundable taxes              8 760    10 432       560       667

Future expenses                          12 741     9 141       814       584

Inventories                               2 324     2 328       149       149

Total current assets                    212 984   170 354    13 612    10 888



NON-CURRENT ASSETS

Other shares and securities               4 655     4 655       297       297

Other long term receivables              19 776    16 746     1 264     1 070

Tangible fixed assets                 3 901 210 3 797 584   249 332   242 709

Total non-current assets              3 925 641 3 818 984   250 894   244 077

TOTAL ASSETS                          4 138 625 3 989 339   264 506   254 965



LIABILITIES AND OWNER’S EQUITY



LIABILITIES

Current liabilities

Customer prepayments                      6 583    13 904       421       889

Supplier payables                        61 701    47 807     3 943     3 055

Taxes payable                             8 625     8 524       551       545

Other short term payables               300 420    26 908    19 200     1 720

Short term provisions                         0     1 316         0        84

Other unearned income                     1 211     1 864        77       119

Total current liabilities               378 541   100 322    24 193     6 412



Non-current liabilities

Long term loan liabilities              100 000    70 000     6 391     4 474

Other long term loans                    27 404    26 000     1 751     1 662

Total non-current liabilities           127 404    96 000     8 143     6 136



Total liabilities                       505 945   196 322    32 336    12 547



OWNER’S EQUITY

Share capital in nominal value        2 650 000 2 750 000   169 365   175 757

Reserves                                262 112   240 433    16 752    15 366

Retained earnings                       647 205   369 013    41 364    23 584

Profit for the year                      73 363   433 571     4 689    27 710

Total owner’s equity                  3 632 680 3 793 017   232 170   242 417

TOTAL LIABILITIES AND OWNER'S EQUITY  4 138 625 3 989 339   264 506   254 965





INCOME STATEMENT, UNAUDITED, IN THOUSANDS

                                              EEK                  EUR

                                       6 months  6 months  6 months   6 months

                                           2003      2002      2003      2002



Revenues                                498 521   497 059    31 861    31 768

Other income                             13 811     3 752       883       240

Materials, consumables and supplies      57 102    40 111     3 649     2 564

Other operating expenses                 63 827    43 382     4 079     2 773

Personnel expenses

     a) salaries                         46 460    48 793     2 969     3 118

     b) social taxes                     15 519    16 357       992     1 045

Depreciation and value-adjustments       77 959    78 139     4 982     4 994

Other expenses                          129 486     2 113     8 276       135



OPERATING PROFIT                        121 978   271 917     7 796    17 379



Financial income and expenses

Financial income and expenses from other

long term financial investments              72         1         5         0

Interest expense                         -1 722    -2 172      -110      -139

Foreign exchange gain (loss)                -51       -30        -3        -2

Other financial income and expenses          62     3 968         4       254

Total financial income and expenses      -1 640     1 766      -105       113



Profit from normal operations           120 339   273 683     7 691    17 491



Income tax                              -46 976         0    -3 002         0



NET PROFIT FOR THE PERIOD                73 363   273 683     4 689    17 491



Net profit per share                      0.275     0.995     0.018     0.064





Aare Tammemäe

Financial Director

6318008