AS KALEV            STOCK EXCHANGE RELEASE       26.09/3.10.2005



Publishing of additional information



A request was submitted by the Tallinn Stock Exchange in its

letter dated 22 September 2005 to publish, as a stock

exchange release, the following information on the 12-month

interim report of AS Kalev for the financial year 2004/2005,

as well as a comment on the “Kalev is kept alive by real

estate” article in the Äripäev of 9 September 2005.



1.



The description of the factors contributing to the unaudited

and consolidated net loss of the company for the 12 months

of the financial year 2004/2005 was published by AS Kalev in

its stock exchange release on 31 August 2005. A detailed

description of these factors has is provided below.



1. Significant increase in raw material prices. The price

   of sugar increased by 2.7 times in the given period,

   while that of nuts and almonds grew by 32.3%.



2. Drop in the price of dairy products on the EU market.

   Compared to the first half-year 2004, the price of milk

   powder dropped by 3% and that of butter by 6% in the

   first six months of 2005. The drop in the above prices

   resulted in nearly a 10-million-kroon revenue decrease

   in the first half-year 2005.



3. Increase in the price of crude milk in Estonia, which

   incurred nearly 4.7 million kroons (i.e. a monthly 780

   thousand kroons) of additional expenses on the company

   in the first half-year 2005.



4. Extraordinary expenses related to the integration of a

   new subsidiary as well as continuation of the

   integration of a previously acquired subsidiary under

   the AS Kalev Group.



5. Extraordinary expenses in the amount of 7.8 million

   kroons (i.e. 0.5 million euros) related to the

   relocation and launch of the caramel factory in the new

   plant complex.



6. A 48% increase in energy, water, and sewerage expenses.



7. A 65.3% increase in product development expenses.



8. A 36% decrease in confectionery product export revenues.





2.



The report states that the company has developed and is

currently pursuing strategic directions and objectives for

overcoming the recession. An overview of the directions and

activities described in the interim report has been provided

below. Publishing a more detailed plan for pursuing the

strategic goals and achieving the objectives would damage

the business interests of the issuer.



To bring the company out of the red, AS Kalev will actively

pursue product development (expansion of the product

portfolio, better positioning of products, entry into new

segments, et al). In connection with the increase in raw

material prices, the company has reviewed its confectionery

product recipes, and brought the product portfolio

profitability into line with the prices. The company has

also developed and launched new chocolate and sugar

confectionery products in order to increase its competitive

ability. These activities will be continued in the future.

The company will also continue focusing on product export,

and has taken the first concrete steps for aggressive

development in the area.



As regards dairy products, the company is expecting fair

crude milk prices to form for future periods. Future

activities in the sector continue to be pursued with the aim

of developing co-operation with customers, enhancing

efficiency and establishing long-term partnerships with milk

producers.





3.



A commentary on AS Kalev Chairman Oliver Kruuda’s statement

in the “Kalev is kept alive by real estate” article in the

Äripäev of 9 September 2005 (“I have no idea what we will do

in three years’ time; we have made no particular plans, we

are just doing our daily work”): This sentence was a

rhetorical element of a longer interview, and has been

misinterpreted out of context. Oliver Kruuda did not suggest

that AS Kalev has made no plans for the future. Rather, he

meant that the company is pursuing the above plans on a

daily basis, with the aim of earning profit.





Ruth Roht

PR manager

+372 6 077 858