Market announcement

Title

Comments on the article published in Äripäev's online edition on 2 October 2008

Message

Äripäev drew attention to a technical conflict between the fourth-quarter
income statement and the 12-month income statement. A calculation error was
introduced in a part of the figures in AS Kalev's fourth-quarter income
statement. As this is a 12-month report, the numbers for the fourth quarter do
not have determining importance and do not change the basic content of the
report, which has been discussed with auditors. The interests of investors have
not been harmed. The adjusted report is available on the Tallinn Stock Exchange
website: 
http://www.baltic.omxnordicexchange.com/market/?pg=details&instrument=EE31000024
60&list=2&tab=news&news_id=227229 
As a comment to the coverage of the topic in the Äripäev article, the
55-million-kroon calculation discrepancy derives from the aforementioned
calculation error. The report includes explanations for the drop in sales in
the dairy and flour confectionery sector. The volume of flour confectionery
products dropped 23% in terms of quantity (page 10 of the 12-month interim
report) and the dairy figures are not comparable at all with previous periods,
as the activity was reorganised to provision of services in the previous
quarter in connection with the drop in prices on the world market for
commodity-type dairy products and the production process was even suspended
temporarily (page 11 of the 12-month interim report). Based on page 17 of the
accounting service guidelines, investments made into renovation of schools were
recognized on accrual basis as a construction service and as a result, the
turnover was recognized in the real estate sector. 

Allan Viirma
Head of Legal Service
tel 6886616