2008-03-12 17:39:29 CET
2008-03-12 17:40:19 CET
REGULATED INFORMATION
Neomarkka - Financial Statement Release
NEOMARKKA´S FINANCIAL STATEMENTS 1.1 - 31.12.2007
Neomarkka Plc STOCK EXCHANGE RELEASE 12.3.2008 1(19) NEOMARKKA´S FINANCIAL STATEMENTS 1.1 - 31.12.2007 -------------------------------------------------------------------------------- | KEY FIGURES | 2007 | 2006 | -------------------------------------------------------------------------------- | Turnover, EUR million, of which | 62.4 | 8.0 | -------------------------------------------------------------------------------- | - gains and losses from trade of | 5.4 | 8.0 | | financial assets | | | -------------------------------------------------------------------------------- | - cable business turnover | 57.1 | | -------------------------------------------------------------------------------- | Operating profit, EUR million, of which | 4.2 | 6.6 | -------------------------------------------------------------------------------- | - trade of financial assets | 4.1 | 6.6 | -------------------------------------------------------------------------------- | - cable business | 0.1 | | -------------------------------------------------------------------------------- | Profit for the financial year EUR | 1.2 | 3.9 | | million | | | -------------------------------------------------------------------------------- | Earnings per share EUR | 0.19 | 0.64 | -------------------------------------------------------------------------------- REPORT BY THE BOARD OF DIRECTORS 2007 MAJOR EVENTS DURING THE FINANCIAL YEAR As a result of the strategy work started in 2006, Neomarkka renewed its strategy in the spring of 2007. According to the renewed strategy, Neomarkka is an investment company that targets long-term industrial investments. Target of the investments in industry is to raise the return on the invested capital by developing the companies involved. Returns are sought both through dividend flow and an increase in value. Assets that are waiting to be invested in line with the new strategy have been primarily invested in either fund-based securities or short-term money markets. With the renewed strategy Neomarkka now has two business areas: investment in securities and industrial private equity investments. Due to this change Neomarkka has adopted segment reporting. Industrial private equity investments; Cables The first step in the implementation of the new strategy was the acquisition from Reka Ltd of the entire share capital of Reka Cables Ltd at a price of EUR 25.8 million. The parties to the deal have also agreed on adjusting the price on the basis of the trend in Reka Cables' average operating margin in 2007 and 2008. The maximum price adjustment either upwards or downwards is EUR 3.5 million. In August, the Board of Directors made a decision to invest a further EUR 9.6 million in Reka Cables Ltd's medium and high voltage factory in Riihimäki. The factory construction and machine purchases processes were started immediately and production will begin in spring 2008. Production at Reka Cables in Russia began and the majority of its sales accumulated in the final months of the year. Investment in the start-up of operations (1.6.-31.12.2007) totalled EUR 5.6 million, of which EUR 3.7 million was in working capital and EUR 1.9 million in machinery. Investments in the cable industry were completed in October. Production at Nestor Cables Ltd will begin in spring 2008. In 2007 the turnover (IFRS) of the Reka Cable Group (Reka Cable Ltd and its subsidiaries) was EUR 97.4 million, with an operating profit (IFRS) of EUR 5.2 million. This would mean an operating profit of EUR 4.1 million in Neomarkka's cable business at the annual level, because of the higher depreciation base created by handling of the acquisition price on an IFRS basis. Neomarkka acquired Reka Cables Ltd on 1 June 2007, after which EUR 57.1 million of its turnover was included in the Neomarkka Group. The acquisition cost calculation for Reka Cables Ltd has been made in accordance with IFRS 3. The release of the inventory margin resulting from the purchase price allocation put a strain on the operating profit by EUR 1.7 million. The operating profit of cable business for the period in question (1.6.2007-31.12.2007) was EUR 0.1 million. Investments in securities Neomarkka sold its direct hedge fund investments and its equity and equity fund investments. Instead of direct hedge fund investments, Neomarkka owns bonds issued by Nordea Bank Plc, including a holding in the eQ Active Hedge Fund. These bonds are constructed so that their share of the eQ Active Hedge Fund was, on subscription in May 2007, double the value of the security, and the difference was financed with loan funding. Thus the return on bonds takes into account the return from the eQ Active Hedge Fund reduced by the costs arising from the loan. Bonds are treated as investments in the balance sheet. In addition to the Nordea Bank Plc issued bonds, investment and fund securities at the balance sheet date comprise investments in money market funds and fixed-period deposits. Regarding private equity, Neomarkka sold its shares in Kymen Puhelin Oy in early 2007. As a result of the strategy change, Neomarkka's portfolio management for hedge fund investments ended. At the same time, the advisory services to the eQ Bank in relation to the portfolio management of the eQ Active Hedge Fund and related provisions ended on 1 June 2007. The former Managing Director of Neomarkka, Samuel von Martens, transferred to the company that acts as advisor to the eQ Bank in relation to the portfolio management of the eQ Active Hedge Fund. In the first half of the year, the value of Neomarkka's investments in securities developed favourably. During the third quarter of the year, stock markets and the value of securities investments fell and the return was unprofitable. In the last quarter of the year, the value of the company's securities investments rose once again, but after expenses, the operating profit remained at same level as at the end of September. The total profits and losses on securities investments in 2007 were EUR 5.4 million and the operating profit EUR 4.1 million. FINANCIAL STATEMENT The financial statements of the Neomarkka Group have been drawn up in accordance with the International Financial Reporting Standard (IFRS). At the end of the financial year, the consolidated turnover (IFRS) totalled EUR 62.4 million (EUR 8.0 million in 2006 and EUR 6.7 million in 2005). The consolidated result (IFRS) shows a profit of EUR 1.2 million (EUR 3.9 million in 2006 and EUR 3.6 million in 2005). Had Reka Cables Ltd been acquired right at the beginning of the financial year, the consolidated turnover (IFRS) would have been EUR 102.8 million for the year, with a consolidated result (IFRS) of EUR 2.4 million. FINANCIAL POSITION OF THE GROUP AND KEY FIGURES (IFRS) -------------------------------------------------------------------------------- | | 2007 | 2006 | 2005 | -------------------------------------------------------------------------------- | Turnover, million euros | 62.4 | 8.0 | 6.7 | -------------------------------------------------------------------------------- | Operating profit % of turnover | 6.7 | 82.5 | 83.7 | -------------------------------------------------------------------------------- | Return on equity % | 1.9 | 6.5 | 6.3 | -------------------------------------------------------------------------------- | Return on investment % | 4.4 | 6.6 | 6.0 | -------------------------------------------------------------------------------- | Equity ratio % | 56.1 | 59.7 | 58.6 | -------------------------------------------------------------------------------- | Earnings per share, EUR | 0.19 | 0.64 | 0.60 | -------------------------------------------------------------------------------- An assessment of the figures must take into account that the turnover from previous years comprised gains and losses on securities investments. NEOMARKKA SHARES: PRICES AND VOLUMES TRADED Neomarkka Plc's B shares are listed on the OMX Nordic Exchange Helsinki. The closing price on the last business day of the year was EUR 9.79 (EUR 7.76) per share. In 2007 the share turnover of Neomarkka B shares on the OMX Nordic Exchange Helsinki was 2,548,864 (1,545,060), comprising 42.3 % (26.3%) of all B shares and accounting for a total of EUR 23.7 (13.3) million. The lowest B share quotation in 2007 was EUR 7.78 (EUR 7.31) and the highest quotation in 2007 was EUR 10.10 (EUR 9.20). On the last business day of 2007, the total share value for Neomarkka B shares was EUR 58.9 (46.7) million. GROUP STRUCTURE AND SHAREHOLDERS Neomarkka Plc is the parent company in a Group that includes the fully owned subsidiaries Novalis Plc and Alnus Ltd with their subsidiaries. The domicile of the parent company is Hyvinkää. At the end of 2007 Neomarkka Ltd had 12,919 (13,888) shareholders. The biggest shareholder Reka Ltd, had a 50.76% (32.49%) interest at the end of the year, with 65.77% (53.09%) of all votes. Neomarkka Plc is thus part of the Reka Group. Reka Ltd's domicile is Hyvinkää. At the end of 2007, the aggregate ownership of the ten largest shareholders was 59.82% (58.37%) of all shares and 72.06% (71.05%) of all votes. ASSESSMENT OF UNCERTAINTY FACTORS AND BUSINESS RISKS The main financial risks of Neomarkka are currency, interest rate, commodity, liquidity, credit and investment market-risks. These financial risks and their hedging measures are explained further in the notes. In accordance with the updated strategy of 2007, future risk factors are more closely tied to trends in the business operations of a small number of portfolio companies and to normal business risks. The previous strategy based Neomarkka's risk on a widely distributed market risk. The distributed market risk means that changes in the value of investment underlying the eQ active Hedge Fund will have a substantial impact on Neomarkka's financial result. The most significant risks at Reka Cable are the fluctuation in raw material costs and more rapid changes in the volume of orders than in the past. In order to be aware of the risks and prepare for them, Reka Cables Ltd has carried out an extensive risk-charting process. The company believes that the cable markets in Russia will grow and develop and has invested heavily in exploiting the business opportunities there. These investments include a risk that the growth in Russia will not take place according to expectations. Nestor Cables Ltd's business carries cable business risks and the risks involved in starting up a new company. Comments made in this report that do not refer to actual facts that have already taken place are future estimates. Such estimates include expectations concerning market trends, growth and profitability, and statements that include the terms ‘believe', ‘assume', ‘will be', or a similar expression. Since these estimates are based on current plans and estimates, they involve risks and uncertainty factors which may lead to results differing substantially from current statements. Such factors include 1) operating conditions, e.g. continued success in production and consequent efficiency benefits, availability and cost of production inputs, demand for new products, changing circumstances in respect of the acquisition of capital under acceptable conditions; 2) circumstances in the sector such as the intensity of demand for products, the competition, current and future market prices for the Group's products and related pricing pressures, the financial situation of the Group's customers and competitors, competitors' possible new competing products and 3) the general economic situation such as economic growth in the Group's main geographical market areas or changes in exchange rates and interest rates. RESEARCH AND DEVELOPMENT ACTIVITIES Group investment in R&D in 2007 amounted to EUR 0.2 million (EUR 0.0 million in 2006 and EUR 0.0 million in 2005). Investments are recorded in the books as operating expenses. R&D investments are targeted at the cable business, which has belonged to the Group since 1 June 2007. SHAREHOLDERS´ MEETING AND GOVERNANCE The Annual General Meeting was held on 22 March 2007. In the Annual General Meeting, the following persons were elected to the Board of Directors: Pekka Kainulainen, Chairman, Taisto Riski, Deputy Chairman and Hannu Anttila, Stig-Erik Bergström and Markku E. Rentto as members. An extraordinary shareholder's meeting was called on 1 June 2007 to decide on the Reka Cables Ltd deal, a new board of directors and changes in the Articles of Association. The extraordinary shareholder's meeting approved the agreement concerning the acquisition of the share capital of Reka Cables Ltd as signed on 10 May 2007 by Neomarkka Plc and the implementation of the deal. The extraordinary shareholder's meeting approved also proposed amendments to the Articles of Association. The amendments related to the reorientation of Neomarkka's business and to some rearrangements caused by the new Companies Act 624/2006 in Finland that took effect on 21 July. The extraordinary shareholder's meeting confirmed the number of the members of the Board of Directors as six, electing the following persons to the Neomarkka Plc Board of Directors as of 1 June 2007: Jorma Wiitakorpi, Chairman, Matti Lainema, Deputy Chairman and Hannu Anttila, Ilpo Helander, Taisto Riski and Pekka Soini as members. The Board of Directors elected its members Hannu Anttila and Taisto Riski as members of the Audit Committee. The Managing Director of Neomarkka as of 10 May 2007 has been Markku E. Rentto, who succeeded Samuel von Martens. At the Annual General Meeting, Deloitte & Touche, Authorized Public Accountants, were chosen as auditor, with Hannu Mattila Authorised Public Accountant appointed main auditor. AUDIT COMMITTEE The Board of Directors appoints an audit committee whose task is to monitor the company's financial situation, oversee the financial reports, assess the sufficiency and pertinence of the internal control and risk management, assess the compliance with legislation and regulations, and maintain communication with the auditors, and review of the auditor's reports. The audit committee reports to the Board of Directors. PERSONNEL During the 2007 financial year, there were an average of 172 people (5 in 2006 and 4 in 2005) employed by the Group. At the end of 2007, the Group had 280 employees, of whom 276 were in the cable business. The total sum of the Group's performance-based salaries and fees in 2007 was EUR 5.8 million (EUR 0.3 million in 2006 and EUR 0.3 million in 2005). ENVIRONMENTAL FACTORS The importance of environmental factors grew when the company renewed its strategy. Caring for the environment and constantly improving business while taking the well-being of the environment into consideration are a part of Reka Cables Ltd's daily activities. The environmental programme of Reka Cables Ltd has been certified according to the ISO 14001 standards. PROPASAL FOR THE DISPOSAL OF PROFITS Parent company´s distributable funds at the end of 2007 totalled EUR 33,806,808.91, of which EUR 5,552,672.23 was profit for the 2007 financial year. There has been no material change in the company's financial situation after the accounting period, and the liquidity test mentioned in the Limited Liabilities Companies Act § 13.2 does not affect the amount of distributable funds. The Board proposes that the distributable funds be disposed of as follows: - as dividend EUR 0.50 per share, a total of EUR 3,010,180.00 - as Retained profit EUR 9,469,822.45 - as other unrestricted equity EUR 21,326,806.46 For the financial year 2006 was paid a dividend of EUR 0.30 per share, totalling EUR 1.8 million. -------------------------------------------------------------------------------- | COMPANY SHARES | 2007 | 2006 | -------------------------------------------------------------------------------- | Restricted shareholders´ equity by | 139,600 | 139,600 | | share series: | 5,880,760 | 5,880,760 | | Series A (20 votes /share) | | | | Series B (1 vote/share) | | | -------------------------------------------------------------------------------- | Total | 6,020,360 | 6,020,360 | -------------------------------------------------------------------------------- DIVIDEND POLICY Neomarkka's target is to use at least 30% of its annual net profit for dividend payments. MAJOR EVENTS AFTER THE REVIEW PERIOD Jorma Leskinen was named Managing Director of Reka Cables Ltd, starting 1 January 2008. PROSPECTS FOR THE NEAR FUTURE The outlook for the cable industry is positive. The overall market situation is expected to remain good, providing that no significant negative changes take place in the overall economic situation on the main markets of the Nordic countries and in Russia. The starting-up of production facilities in Russia and the expansion of the Riihimäki production facilities give cause to believe that the turnover of industrial activities will reach EUR 120 million and that there will be increase in profitability. The prices of key raw materials are expected to be quite volatile. Changes in raw material prices can effect the development of the turnover. The uncertain situation in securities investment will continue. Investment in hedge funds will be reduced further. THE ANNUAL GENERAL MEETING The Board of Directors decided, that the Annual General Meeting will be held on 11 June 2008 at 12.00 in Hyvinkää. The summons to the Annual General Meeting will be published on 8 May 2008. -------------------------------------------------------------------------------- | CONSOLIDATED INCOME STATEMENT (IFRS) | 1.1.-31.12. | 1.1.-31.12. | | EUR 1,000 | 2007 | 2006 | -------------------------------------------------------------------------------- | Industrial business turnover | 57,081 | 0 | -------------------------------------------------------------------------------- | Gains and losses from the trade of | 5,362 | 8,033 | | financial assets | | | -------------------------------------------------------------------------------- | Turnover | 62,443 | 8,033 | -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- | Change in inventories of finished products | -3,375 | 0 | | and production in progress | | | -------------------------------------------------------------------------------- | Production for own use | 30 | 0 | -------------------------------------------------------------------------------- | Materials and services | -39,277 | 0 | -------------------------------------------------------------------------------- | Personnel expenses | -7,048 | -541 | -------------------------------------------------------------------------------- | Depreciation and impairment | -2,087 | -29 | -------------------------------------------------------------------------------- | Other operating income and expenses | -6,503 | -836 | -------------------------------------------------------------------------------- | | -58,261 | -1,406 | -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- | Operating profit | 4,182 | 6,627 | -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- | Financial income | 80 | 0 | -------------------------------------------------------------------------------- | Financial expenses | -2,299 | -1,659 | -------------------------------------------------------------------------------- | Share of the result of associates | -47 | 0 | -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- | Profit before taxes | 1,916 | 4,968 | -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- | Taxes | -763 | -1,088 | -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- | Profit for the financial year | 1,153 | 3,880 | -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- | Earnings per share after and before | 0.19 | 0.64 | | dilution, EUR | | | -------------------------------------------------------------------------------- | Number of shares | 6,020,360 | 6,020,360 | -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- | CONSOLIDATED BALANCE SHEET (IFRS) | 31.12.2007 | 31.12.2006 | -------------------------------------------------------------------------------- | EUR 1,000 | | | -------------------------------------------------------------------------------- | A s s e t s | | | -------------------------------------------------------------------------------- | NON-CURRENT ASSETS | | | -------------------------------------------------------------------------------- | Goodwill | 4,527 | 0 | -------------------------------------------------------------------------------- | Other intangible assets | 3,479 | 0 | -------------------------------------------------------------------------------- | Shares in associates | 23,916 | 0 | -------------------------------------------------------------------------------- | Tangible assets | 1,004 | 51 | -------------------------------------------------------------------------------- | Deferred tax assets | 204 | 0 | -------------------------------------------------------------------------------- | TOTAL NON-CURRENT ASSETS | 33,130 | 51 | -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- | CURRENT ASSETS | | | -------------------------------------------------------------------------------- | Inventories | 16,815 | 0 | -------------------------------------------------------------------------------- | Financial assets recognised at fair value | 37,034 | 87,032 | | through profit and loss | | | -------------------------------------------------------------------------------- | Available-for-sale financial assets | 4,001 | 4,112 | -------------------------------------------------------------------------------- | Sales receivables and other receivables | 12,154 | 8,429 | -------------------------------------------------------------------------------- | Cash in hand and at bank | 3,268 | 3,324 | -------------------------------------------------------------------------------- | TOTAL CURRENT ASSETS | 73,271 | 102,897 | -------------------------------------------------------------------------------- | A s s e t s | 106,401 | 102,948 | -------------------------------------------------------------------------------- | S h a r e h o l d e r s´ e q u i t y a | | | | n d l i a b i l i t i e s | | | -------------------------------------------------------------------------------- | SHAREHOLDERS´ EQUITY | | | -------------------------------------------------------------------------------- | Share capital | 24,082 | 24,082 | -------------------------------------------------------------------------------- | Premium fund | 66 | 66 | -------------------------------------------------------------------------------- | Reserve fund | 1,221 | 1,221 | -------------------------------------------------------------------------------- | Translation differences | -145 | 0 | -------------------------------------------------------------------------------- | Retained profit | 11,971 | 9,897 | -------------------------------------------------------------------------------- | Other unrestricted equity | 21,327 | 21,327 | -------------------------------------------------------------------------------- | Profit for the financial year | 1,153 | 3,880 | -------------------------------------------------------------------------------- | TOTAL SHAREHOLDERS' EQUITY | 59,675 | 60,473 | -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- | LONG-TERM LIABILITIES | | | -------------------------------------------------------------------------------- | Deferred tax liabilities | 2,091 | 1,632 | -------------------------------------------------------------------------------- | Provisions | 540 | 0 | -------------------------------------------------------------------------------- | Interest-bearing liabilities | 22,512 | 0 | -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- | SHORT-TERM LIABILITIES | | | -------------------------------------------------------------------------------- | Tax liabilities from the profit | 198 | 0 | -------------------------------------------------------------------------------- | Short-term interest-bearing liabilities | 4,999 | 40,000 | -------------------------------------------------------------------------------- | Accounts payable and other liabilities | 16,386 | 843 | -------------------------------------------------------------------------------- | TOTAL LIABILITIES | 46,726 | 42,475 | -------------------------------------------------------------------------------- | S h a r e h o l d e r s´ e q u i t y a | 106,401 | 102,948 | | n d l i a b i l i t i e s | | | -------------------------------------------------------------------------------- BALANCING ACCOUNT OF SHAREHOLDERS´ EQUITY (IFRS) -------------------------------------------------------------------------------- | EUR 1,000 | Share | Premiu | Reserv | Trans-l | Other | Retai-n | Share-ho | | | capita | m fund | e | ation | unres- | ed | lders´ | | | l | | fund | differe | tric-t | profit | equity | | | | | | nces | ed | | total | | | | | | | equity | | | -------------------------------------------------------------------------------- | Share-hol | 24,082 | 66 | 1,221 | 0 | 21,327 | 11,703 | 58,399 | | ders´ | | | | | | | | | equity | | | | | | | | | 31.12.200 | | | | | | | | | 5 | | | | | | | | -------------------------------------------------------------------------------- | Changes | | | | | | | 0 | -------------------------------------------------------------------------------- | Profit | | | | | | 3,880 | 3,880 | | for the | | | | | | | | | financial | | | | | | | | | year | | | | | | | | -------------------------------------------------------------------------------- | Total | | | | | | 3,880 | 3,880 | | returns | | | | | | | | | and costs | | | | | | | | | during | | | | | | | | | the | | | | | | | | | period | | | | | | | | -------------------------------------------------------------------------------- | Dividends | | | | | | -1,806 | -1,806 | | paid | | | | | | | | -------------------------------------------------------------------------------- | Share-hol | 24,082 | 66 | 1,221 | 0 | 21,327 | 13,777 | 60,473 | | ders´ | | | | | | | | | equity | | | | | | | | | 31.12.200 | | | | | | | | | 6 | | | | | | | | -------------------------------------------------------------------------------- | EUR 1,000 | Share | Premiu | Reserv | Trans-l | Other | Retai-n | Share-ho | | | capita | m fund | e | ation | unres- | ed | lders´ | | | l | | fund | dirrere | tric-t | profit | equity | | | | | | nces | ed | | total | | | | | | | equity | | | -------------------------------------------------------------------------------- | Share-hol | 24,082 | 66 | 1,221 | 0 | 21,327 | 13,777 | 60,473 | | ders´ | | | | | | | | | equity | | | | | | | | | 31.12.200 | | | | | | | | | 6 | | | | | | | | -------------------------------------------------------------------------------- | Changes | | | | -145 | | | -145 | -------------------------------------------------------------------------------- | Profit | | | | | | 1,153 | 1,153 | | for the | | | | | | | | | financial | | | | | | | | | year | | | | | | | | -------------------------------------------------------------------------------- | Total | | | | -145 | | 1,153 | 1,008 | | returns | | | | | | | | | and costs | | | | | | | | | during | | | | | | | | | the | | | | | | | | | period | | | | | | | | -------------------------------------------------------------------------------- | Dividends | | | | | | -1,806 | -1,806 | | paid | | | | | | | | -------------------------------------------------------------------------------- | Share-hol | 24,082 | 66 | 1,221 | -145 | 21,327 | 13,124 | 59,675 | | ders´ | | | | | | | | | equity | | | | | | | | | 31.12.200 | | | | | | | | | 7 | | | | | | | | -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- | CONSOLIDATED CASH FLOW STATEMENT (IFRS) | 1.1.-31.12. | 1.1.-31.12. | | EUR 1,000 | 2007 | 2006 | -------------------------------------------------------------------------------- | OPERATING ACTIVITIES | | | -------------------------------------------------------------------------------- | Payments received from operating activities | 173,612 | 78,493 | -------------------------------------------------------------------------------- | Payments paid on operating activities | -106,229 | -73,096 | -------------------------------------------------------------------------------- | Paid interests and other financial expenses | -4,032 | -1,388 | -------------------------------------------------------------------------------- | Interests received and other financial | 29 | 17 | | incomes | | | -------------------------------------------------------------------------------- | Direct taxes paid | -2,537 | 0 | -------------------------------------------------------------------------------- | Total operating activities | 60,842 | 4,026 | -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- | INVESTING ACTIVITIES | | | -------------------------------------------------------------------------------- | Acquisition of subsidiaries and new | -28,038 | 0 | | business | | | -------------------------------------------------------------------------------- | Investments in tangible assets | -10,794 | -65 | -------------------------------------------------------------------------------- | Total investing activities | -38,831 | -65 | -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- | FINANCING ACTIVITIES | | | -------------------------------------------------------------------------------- | Increase in loans | 25,150 | 0 | -------------------------------------------------------------------------------- | Decrease in loans | -45,132 | 0 | -------------------------------------------------------------------------------- | Payments of financial leasing | -299 | 0 | -------------------------------------------------------------------------------- | Dividends paid | -1,786 | -1,781 | -------------------------------------------------------------------------------- | Total financing activities | -22,067 | -1,781 | -------------------------------------------------------------------------------- | | | | -------------------------------------------------------------------------------- | CASH FLOW FOR THE PERIOD | -56 | 2,180 | -------------------------------------------------------------------------------- | Liquid funds at beginning of the period | 3,324 | 1,144 | -------------------------------------------------------------------------------- | LiQUID FUNDS AT END OF PERIOD | 3,268 | 3,324 | -------------------------------------------------------------------------------- NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS General information on the company Neomarkka Plc is the parent company of a group comprising its wholly-owned subsidiaries Novalis plc and Alnus Oy with their subsidiaries. The domicile of the parent company is Hyvinkää. The address of Neomarkka Plc is Aleksanterinkatu 48 A, 00100 Helsinki. Neomarkka Plc's B shares are listed on OMX Nordic Exchange Helsinki. Neomarkka Group is part of the Reka Group. The parent company of the Reka Group is Reka Ltd, which is domiciled in Hyvinkää. Reka Ltd's address is Niinistönkatu 8-12, 05800 Hyvinkää. Neomarkka Group consists of two segments: investments in securities and industrial private equity investments. At the time of closing the accounts, industrial private equity investments comprised on one business area: cable industry. Apart from Finland, Neomarkka Group has operations in Russia, Sweden, the Baltic countries and Denmark. PRINCIPLES FOR DRAWING UP CONSOLIDATED FINANCIAL STATEMENTS Basis of preparation The consolidated financial statements have been prepared in accordance with the International Financial Reporting Standards, in compliance with the IAS- and IRFS- standards and interpretations as well as SIC- and IFRIC-interpretations effective at 31 December 2007. The International Financial Reporting Standards stand for standards and their interpretations, enacted in the Finnish Accounting Act and in regulations passed by force of the act, which have been approved by the European Union in accordance with EU Regulation 1606/2002. The notes to the consolidated financial statements also comply with Finnish accounting and companies legislation. The consolidated financial statements have been prepared based on original cost except the following assets that have been measured at fair value: financial assets recognised at fair value through profit and loss, derivative financial instruments, cash and cash equivalents and tangible and intangible assets measured at fair value in the acquisition cost calculation of Reka Cables Ltd purchasing under IFRS 3. The following new standards, their amendments and interpretations found relevant to the Group were adopted in 2007: - IFRS 7 Financial instruments: Disclosures and the related amendments to IAS 1 Presentation of Financial Statements - Capital Disclosures. IFRS 7 requires new notes on financial instruments. The standard has no impact on the classification or measurement of the Group's financial instruments. - IFRIC 9 Reassessment of Embedded Derivatives. The interpretation requires assessment whether instruments include embedded derivatives that must be separated from the host contract and dealt with as derivative instruments. - IFRIC 10 Interim Financial Reporting and Impairment. IFRIC 10 prohibits reversal of any goodwill impairment loss recognized in an interim report on a later closing date during the same reporting period. The adoption of these new standards and interpretations does not have substantial impact on the reported income statement, balance sheet or notes to the financial statements. The following interpretations are compulsory in 2007 but have no importance for the Group: - IFRIC 7 Applying the Restatement Approach under IAS 29 Reporting in Hyperinflationary Economies. - IFRIC 8 IFRS 2: Scope. The financial statements have been audited by the company auditors. SEGMENT INFORMATION The segment information is presented in accordance with the Group's business and geographical segment division. The Group has defined the business segment as its primary segment and the geographical segment as its secondary segment. Pricing between segments takes place at market price. Primary segment The Group's main segments are investments in securities and industrial private equity investments. Investments in securities are a single entity. Industrial private equity investments are divided in different operating sectors if necessary. On the balance sheet date, industrial private equity investments consisted of the cable sector. In 2006 the Group had only one segment, which is equivalent to the current segment of investments in securities. In 2006 the entire operations were present as operations of this segment. Thus there was no separate segment reporting. -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- | EUR 1,000 | -------------------------------------------------------------------------------- | 2007 | -------------------------------------------------------------------------------- | | Investment | Industrial | Others and | Total | | | in | Investment; | eliminations | | | | securities | cables | | | -------------------------------------------------------------------------------- | Industrial business | 0 | 57,081 | | 57,081 | | turnover | | | | | -------------------------------------------------------------------------------- | Gains and losses from | 5,362 | 0 | | 5,362 | | the trade of | | | | | | financial assets | | | | | -------------------------------------------------------------------------------- | Internal sales | | | | | -------------------------------------------------------------------------------- | Turnover | 5,362 | 57,081 | | 62,443 | -------------------------------------------------------------------------------- | Segment operating | 4,087 | 82 | | 4,169 | | profit | | | | | -------------------------------------------------------------------------------- | Unallocated items | | | 13 | 13 | -------------------------------------------------------------------------------- | Operating profit | | | | 4,182 | -------------------------------------------------------------------------------- | Share of the result | | -47 | | -47 | | of associates | | | | | -------------------------------------------------------------------------------- | Unallocated items | | | | -2,982 | -------------------------------------------------------------------------------- | Profit for the | | | | 1,153 | | financial year | | | | | -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- | Segment assets | 41,310 | 64,084 | | 105,395 | -------------------------------------------------------------------------------- | Unallocated assets | | | 1,007 | 1,007 | -------------------------------------------------------------------------------- | Total assets | 41,310 | 64,084 | 1,007 | 106,401 | -------------------------------------------------------------------------------- | | | | | | -------------------------------------------------------------------------------- | Segment liabilities | 637 | 16,099 | | 16,736 | -------------------------------------------------------------------------------- | Unallocated | | | 29,990 | 29,990 | | liabilities | | | | | -------------------------------------------------------------------------------- | Total liabilities | 637 | 16,099 | 29,990 | 46,727 | -------------------------------------------------------------------------------- | | | | | | -------------------------------------------------------------------------------- | Assets - Liabilities | 40,673 | 47,985 | -28,984 | 59,675 | -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- | Investments | 0 | 5,824 | 2,905 | 8,729 | -------------------------------------------------------------------------------- | Depreciations | -24 | -1,964 | -99 | -2,087 | -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- | 2006 | -------------------------------------------------------------------------------- | | Investment | Industrial | Others and | Total | | | in | Investment; | eliminations | | | | securities | cables | | | -------------------------------------------------------------------------------- | Industrial business | 0 | | | 0 | | turnover | | | | | -------------------------------------------------------------------------------- | Gains and losses from | 8,033 | | | 8,033 | | the trade of | | | | | | financial assets | | | | | -------------------------------------------------------------------------------- | Internal sales | | | | | -------------------------------------------------------------------------------- | Turnover | 8,033 | | | 8,033 | -------------------------------------------------------------------------------- | Segment operating | 6,627 | | | 6,627 | | profit | | | | | -------------------------------------------------------------------------------- | Unallocated items | 0 | | | 0 | -------------------------------------------------------------------------------- | Operating profit | 6,627 | | | 6,627 | -------------------------------------------------------------------------------- | Share of the result | 0 | | | 0 | | of associates | | | | | -------------------------------------------------------------------------------- | Unallocated items | 0 | | | 0 | -------------------------------------------------------------------------------- | Profit for the | 3,880 | | | 3,880 | | financial year | | | | | -------------------------------------------------------------------------------- | | | | | | -------------------------------------------------------------------------------- | Segment assets | 102,948 | | | 102,948 | -------------------------------------------------------------------------------- | Unallocated assets | 0 | | | 0 | -------------------------------------------------------------------------------- | Total assets | 102,948 | | | 102,948 | -------------------------------------------------------------------------------- | | | | | | -------------------------------------------------------------------------------- | Segment liabilities | 42,475 | | | 42,475 | -------------------------------------------------------------------------------- | Unallocated | 0 | | | 0 | | liabilities | | | | | -------------------------------------------------------------------------------- | Total liabilities | 42,475 | | | 42,475 | -------------------------------------------------------------------------------- | | | | | | -------------------------------------------------------------------------------- | Assets - Liabilities | 60,473 | | | 60,473 | -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- | Investments | 65 | | | 65 | -------------------------------------------------------------------------------- | Depreciations | -29 | | | -29 | -------------------------------------------------------------------------------- Secondary segment The Group's secondary segment is geographical, with division into EU and non-EU countries. In the geographical segment, turnover has been taken into account according to where good or services have been delivered, and assets have been handled according to location. Investment has been treated on the basis of the area in which the investment has been made. Investments in securities have principally been taken into account in full in the EU figures in spite of the fact that the investments may have been outside EU during part of the year. -------------------------------------------------------------------------------- | EUR 1,000 | Turnover | Assets | Investments | -------------------------------------------------------------------------------- | | 2007 | 2006 | 2007 | 2006 | 2007 | 2006 | -------------------------------------------------------------------------------- | EU-countries | 56,352 | 8,033 | 105,285 | 102,948 | 8,421 | 65 | -------------------------------------------------------------------------------- | Non-EU-countries | 6,091 | 0 | 10,951 | 0 | 2,244 | 0 | -------------------------------------------------------------------------------- | Eliminations and | 0 | 0 | -9,835 | 0 | -1,936 | 0 | | unallocated | | | | | | | | items | | | | | | | -------------------------------------------------------------------------------- | Group total | 62,443 | 8,033 | 106,401 | 102,948 | 8,729 | 65 | -------------------------------------------------------------------------------- Acquisitions of subsidiaries and associates have not been treated as investments. AQUIRED BUSINESS Reka Cables Ltd Neomarkka bought the entire share capital of Reka Cables Ltd from Reka Ltd in a share transaction completed on 1 June 2007. The price was paid in cash. In addition to the acquisition prise, the price includes EUR 1.2 million of expert fees and asset transfer taxes related to the deal. The following assets and liabilities were recognised on the acquisition under IFRS 3. -------------------------------------------------------------------------------- | EUR 1,000 | Acquiree´s | Fair value | Fair value | | | carrying amount | adjustments | | | | before | | | | | combination | | | -------------------------------------------------------------------------------- | Net assets acquired | | | | -------------------------------------------------------------------------------- | Intangible assets | 24 | 3,490 | 3,514 | -------------------------------------------------------------------------------- | Tangible assets | 13,603 | 3,511 | 17,114 | -------------------------------------------------------------------------------- | Investments | 74 | 0 | 74 | -------------------------------------------------------------------------------- | Inventories | 17,726 | 1,661 | 19,387 | -------------------------------------------------------------------------------- | Current receivables | 18,962 | 0 | 18,962 | -------------------------------------------------------------------------------- | Cash in hand and at bank | 660 | 0 | 660 | -------------------------------------------------------------------------------- | Deferred tax liability | -855 | -2,252 | -3,107 | -------------------------------------------------------------------------------- | Provisions | -509 | 0 | -509 | -------------------------------------------------------------------------------- | Other non-current | -5,025 | 0 | -5,025 | | liabilities | | | | -------------------------------------------------------------------------------- | Other current liabilities | -28,609 | 0 | -28,609 | -------------------------------------------------------------------------------- | Net assets aquired | | | 22,460 | -------------------------------------------------------------------------------- | Goodwill arising on aquisition | | 4,527 | -------------------------------------------------------------------------------- | Total consideration, satisfied by cash | | 26,987 | -------------------------------------------------------------------------------- | Net cash outflow arising on acquisition: | | -------------------------------------------------------------------------------- | Cash consideration paid, expert fees and asset transfer | -26,987 | | tax | | -------------------------------------------------------------------------------- | Cash and cash equivalents acquired | | 660 | -------------------------------------------------------------------------------- | Net cash outflow arising on acquisition: | | -26,327 | -------------------------------------------------------------------------------- Changes in the fair values of intangible assets comprise customer relations (EUR 2.8 million) and product brands and trademarks (EUR 0.7 million). The goodwill consists mainly of the personnel. Reka Cables´s profit for the financial year came to EUR 0.7 million in the period 1 June 2007 - 31 December 2007. If Reka Cables had been acquired at the beginning of the financial period, the turnover in cable operations (1 January 2007 - 31 December 2007) would have totalled EUR 97.4 million, bringing Neomarkka's turnover to EUR 102.8 million and profit for the financial year to EUR 2.4 million. The profit for the financial year takes into account the diluting effect of the release of the margin included in the value of inventories in attributing the acquisition cost. LIABILITIES -------------------------------------------------------------------------------- | DERIVATIVE CONTRACTS, EUR 1,000 | 31.12.2007 | 31.12.2006 | -------------------------------------------------------------------------------- | Nominal values | | | -------------------------------------------------------------------------------- | Interest derivatives | | | -------------------------------------------------------------------------------- | Interest rate ceiling derivatives | 9,800 | 0 | -------------------------------------------------------------------------------- | Foreign exchange derivatives | | | -------------------------------------------------------------------------------- | Currency forward contracts | 0 | 21,120 | -------------------------------------------------------------------------------- | Raw material derivatives | | | -------------------------------------------------------------------------------- | Price hedging for metals | 1,119 | 0 | -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- | Fair values | | | -------------------------------------------------------------------------------- | Interest derivatives | | | -------------------------------------------------------------------------------- | Interest rate ceiling derivatives | 27 | 0 | -------------------------------------------------------------------------------- | Foreign exchange derivatives | | | -------------------------------------------------------------------------------- | Currency forward contracts | 0 | -90 | -------------------------------------------------------------------------------- | Raw material derivatives | | | -------------------------------------------------------------------------------- | Price hedging for metals | -36 | 0 | -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- | CONTINGENT LIABILITIES | -------------------------------------------------------------------------------- | EUR 1,000 | 31.12.2007 | 31.12.2006 | -------------------------------------------------------------------------------- | Debts, on behalf | | corporate mortgages are given | -------------------------------------------------------------------------------- | Loans from financial institutions | 7,891 | 0 | -------------------------------------------------------------------------------- | Granted corporate mortgages | 15,000 | 0 | -------------------------------------------------------------------------------- --------------------------------------------------------------------------------| Debts, on behalf | | securities or guarantees are given | -------------------------------------------------------------------------------- | Loans from financial institutions | 13,033 | 0 | -------------------------------------------------------------------------------- | Book value of pledged securities | 26,987 | 0 | -------------------------------------------------------------------------------- | Granted guarantees | 13,033 | 0 | -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- | OTHER COLLATERALS | | | -------------------------------------------------------------------------------- | Guarantees | 120 | 0 | -------------------------------------------------------------------------------- Payment commitments: Reka Cables Ltd has made a commitment to the raw material acquisitions of its subsidiary ZAO Reka Cables. The sales receivables concerned are security for the factoring credit. The financial lease liabilities are in total EUR 6.6 million and liabilities under other leases are in total EUR 4.3 million. Investment commitments Investment commitments on tangible current assets on 31 December 2007 totalled EUR 6.2 million (end 2006: EUR 0.0 million). Investment commitments are related to the extension of the cable production plant in Riihimäki. Adjustment of purchase price Concerning the acquisition of Reka Cables the parties to the deal have agreed on an adjustment to the purchase price on the basis of the average operating margin of Reka Cables in 2007 and 2008. At the most, the price can be raised or lowered by EUR 3.5 million. Contingent liabilities for associates The owner companies and founder shareholders of Nestor Cables Ltd have undertaken to increase equity-rated funding to the company if the corporate equity ratio is 15% or below in the financial statements of 31 December 2008 or if the company is found insolvent or over-indebted before the approval of the said financial statements as specified in section 5 of the Act on recovery to a bankrupt's estate (758/1991). At most the equity investment obligation of the Neomarkka Group in such a situation is EUR 0.9 million. RELATED PARTY EVENTS Neomarkka Plc and thereby the Neomarkka Group is part of the Reka Group. Reka Ltd's share of Neomarkka Plc's share capital is 50.76% and 65.78% of the voting rights. -------------------------------------------------------------------------------- | BUSINESS WITH REKA GROUP | -------------------------------------------------------------------------------- | EUR 1,000 | 2007 | 2006 | -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- | Sales to Reka Group | 69 | 0 | -------------------------------------------------------------------------------- | Dividends to Reka Group | -587 | -587 | -------------------------------------------------------------------------------- | Acquisition of Reka Cables Ltd | -25,803 | 0 | -------------------------------------------------------------------------------- | Other purchases from Reka Group | -4,359 | 0 | -------------------------------------------------------------------------------- | Sales receivables and other receivables at end of | 604 | 0 | | period | | | -------------------------------------------------------------------------------- | Non-current debts (financial leases) at end of | -5,204 | 0 | | period | | | -------------------------------------------------------------------------------- | Other debts at end of period | -375 | 0 | -------------------------------------------------------------------------------- | Guarantees received | 1,547 | 0 | -------------------------------------------------------------------------------- KEY FIGURES Key figures from the Income Statement and Balance Sheet -------------------------------------------------------------------------------- | EUR 1,000 | 2007 | 2006 | 2005 | -------------------------------------------------------------------------------- | Industrial business turnover | 57,081 | - | - | -------------------------------------------------------------------------------- | Gains and losses from the trade of | 5,362 | 8,033 | 6,695 | | financial assets | | | | -------------------------------------------------------------------------------- | Turnover | 62,443 | 8,033 | 6,695 | -------------------------------------------------------------------------------- | Operating profit | 4,182 | 6,627 | 5,603 | -------------------------------------------------------------------------------- | - Industrial investments | 82 | - | - | -------------------------------------------------------------------------------- | - Trade of financial assets | 4,087 | 6,627 | 5,603 | -------------------------------------------------------------------------------- | Operating profit % | 6.7 | 82.5 | 83.7 | -------------------------------------------------------------------------------- | Profit before taxes | 1,916 | 4,968 | 4,458 | -------------------------------------------------------------------------------- | % of net turnover | 3.1 | 61.9 | 66.6 | -------------------------------------------------------------------------------- | Profit for the financial year | 1,153 | 3,880 | 3,626 | -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- | Return on equity % (ROE) | 1.9 | 6.5 | 6.3 | -------------------------------------------------------------------------------- | Return on investment % (ROI) | 4.4 | 6.6 | 6.0 | -------------------------------------------------------------------------------- | Equity ratio, % | 56.1 | 59.7 | 58.6 | -------------------------------------------------------------------------------- | Net-debt-equity ratio (Gearing), % | 13.7 | 54.4 | 62.9 | -------------------------------------------------------------------------------- | Investments in tangible assets | 8,572 | 65 | - | -------------------------------------------------------------------------------- | Number of employees in average | 172 | 5 | 4 | -------------------------------------------------------------------------------- Key figures per share (series A and B) -------------------------------------------------------------------------------- | | 2007 | 2006 | 2005 | -------------------------------------------------------------------------------- | Equity/share, EUR | 9.91 | 10.04 | 9.70 | -------------------------------------------------------------------------------- | Earnings/share (EPS), EUR | 0.19 | 0.64 | 0.60 | -------------------------------------------------------------------------------- | Dividend/share, EUR | 0.50 | 0.30 | 0.30 | -------------------------------------------------------------------------------- | Dividend/earnings, % | 261.0 | 46.5 | 49.8 | -------------------------------------------------------------------------------- | Effective dividend yield, % | 5.1 | 3.9 | 3.9 | -------------------------------------------------------------------------------- | P/E -ratio | 51.1 | 12.0 | 12.9 | -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- | Share performance, EUR | | | | -------------------------------------------------------------------------------- | - average quotation | 9.29 | 8.53 | 7.28 | -------------------------------------------------------------------------------- | - lowest quotation | 7.78 | 7.31 | 6.40 | -------------------------------------------------------------------------------- | - highest quotation | 10.10 | 9.20 | 8.38 | -------------------------------------------------------------------------------- | - quotation at the end of period | 9.79 | 7.76 | 7.75 | -------------------------------------------------------------------------------- | Market capitalisation, | 58,870 | 45,635 | 45,576 | | EUR 1,000 | | | | -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- | Trading in shares, no. | | | | -------------------------------------------------------------------------------- | B shares | 2,548,864 | 1,545,060 | 2,289,012 | -------------------------------------------------------------------------------- | - % of B shares | 42.3 | 26.3 | 38.9 | -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- | Adjusted and weighted average | 6,020,360 | 6,020,360 | 6,020,360 | | number of shares during the year | | | | -------------------------------------------------------------------------------- | A shares | 139,600 | 139,600 | 139,600 | -------------------------------------------------------------------------------- | B shares | 5,880,760 | 5,880,760 | 5,880,760 | -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- | Adjusted number of shares at the | 6,020,360 | 6,020,360 | 6,020,360 | | end of period | | | | -------------------------------------------------------------------------------- | A shares | 139,600 | 139,600 | 139,600 | -------------------------------------------------------------------------------- | B shares | 5,880,760 | 5,880,760 | 5,880,760 | -------------------------------------------------------------------------------- CALCULATION OF KEY FIGURES -------------------------------------------------------------------------------- | Return on | = | Profit for the financial year / | x 100 | -------------------------------------------------------------------------------- | equity (ROE) % | | Shareholders' equity average | -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- | Return on | = | Profit before taxes + interest- and | x 100 | | investment | | other financial expenses / | | -------------------------------------------------------------------------------- | (ROI) % | | [Balance sheet total - obligatory provisions and | | | | non-interest debts] (average) | -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- | Equity ratio, % | = | Shareholders' equity + minority interest | x 100 | | | | less deferred tax assets / | | -------------------------------------------------------------------------------- | | | Balance sheet total - advances received | | -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- | Net-debt-equity | = | Interest bearing-liabilities - cash in | x 100 | | ratio (Gearing) % | | hand and at bank and other liquid | | | | | financial- and investment securities / | | -------------------------------------------------------------------------------- | | | Shareholders´ equity + minority | | | | | interest | | -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- | Earnings per | = | Profit for the review period belonging | | | share (EPS), EUR | | to parent company owners / | | -------------------------------------------------------------------------------- | | | Number of shares, adjusted for share | | | | | issues (average) | | -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- | Equity/share, EUR | = | Shareholders´ equity - minority interest | | | | | less deferred taxes / | | -------------------------------------------------------------------------------- | | | Adjusted number of shares at the end of | | | | | period | | -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- | Dividend/share, | = | Dividend for the financial year / | | -------------------------------------------------------------------------------- | EUR | | Adjusted number of shares at the end of | | | | | period | | -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- | Dividend/earnings | = | Dividend/share / | x 100 | | , | | | | -------------------------------------------------------------------------------- | % | | Earnings/share | | -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- | Effective | = | Dividend/share / | x 100 | | dividend | | | | -------------------------------------------------------------------------------- | yield, % | | Adjusted share price at the end of | | | | | period | | -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- | P/E - ratio | = | Adjusted share price at the end of period / | -------------------------------------------------------------------------------- | | | Earnings/share | -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- | Market | = | (No. of B shares - no. of own B shares) x closing | | capitalisation | | price at year end | -------------------------------------------------------------------------------- | | | + No. of A shares x average quotation | -------------------------------------------------------------------------------- Helsinki 12.3.2008 Neomarkka Plc Board of Directors pp. Sari Tulander CFO FURTHER INFORMATION: Managing Director, Markku E. Rentto, tel. +358 207 209 190 Sari Tulander, CFO, tel. +358 207 209 192 DISTRIBUTION OMX Nordic Exchange Helsinki Main media www.neomarkka.fi
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