The Stockmann Group's sales from continuing operations grew by 16 per cent to EUR 371.7 million (EUR 320.9 million in 2006). Profit from continuing operations before taxes grew substantially and was EUR 8.0 million (EUR 1.1 million). Owing to the effect of other operating income that was booked in the comparison period, the entire Group's profit before taxes decreased by EUR 0.7 million in the report period. Earnings per share were EUR 0.11. The earnings estimate for 2007 is unchanged. Key figures Q1/2007 Q1/2006 2006 Continuing operations Sales EUR mill. 371.7 320.9 1 477.8 Revenue EUR mill. 311.4 269.4 1 239.6 Operating profit EUR mill. 8.2 0.8 99.9 Profit before taxes EUR mill. 8.0 1.1 99.4 Earnings per share EUR 0.11 0.02 1.39 Group total Equity per share EUR 9.14 8.40 10.34 Cash flow from operating EUR mill. -38.6 -31.7 117.4 activities Gearing per cent 19.7 18.4 -6.3 Equity ratio per cent 63.0 64.1 74.5 Weighted average number of thousands 55 353 54 077 54 310 shares Return on capital employed, per cent 22.0 21.6 22.9 rolling 12 months Financial reporting Stockmann adopted International Financial Reporting Standards (IFRS) on January 1, 2005. The accounting policies and calculation methods applied in the Quarterly Report are the same as those in the 2006 financial statements. In the financial reporting for 2006, Stockmann Auto and the Zara business in Russia are treated as discontinued operations in accordance with IFRS 5. The figures are unaudited. Sales and result Stockmann's consolidated sales, eliminating the Stockmann Auto business for the comparison period, were up 15.8 per cent. Net of the elimination, sales decreased by 6.1 per cent to EUR 371.7 million (EUR 395.7 million). The exceptionally strong sales growth was due to running the Department Store Division's Crazy Days campaign at the department stores in Finland entirely in March. The Group's sales abroad amounted to EUR 90.3 million, an increase of 15 per cent. Sales from continuing operations in Finland grew by 16.0 per cent to EUR 281.4 million. International operations accounted for an increased share of consolidated sales, rising from 20 per cent to 24 per cent. Revenue was EUR 311.4 million, as against EUR 330.5 million in the comparison period. There was no other operating income. In the comparison period, other operating income of EUR 7.4 million came from the capital gain on the disposal of Stockmann Auto. The gross margin on the Group's operations rose by EUR 10.5 million to EUR 119.8 million and the relative gross margin was 38.5 per cent (33.1 per cent). The relative gross margin improved at all the business units. The Group's relative gross margin was furthermore improved by the discontinuance of low-margin vehicle sales as from the beginning of March 2006. Operating expenses increased by EUR 2.6 million and depreciation by EUR 0.8 million. Because of other operating income booked in the comparison period, consolidated operating profit diminished by EUR 0.3 million to EUR 8.2 million. Operating profit from continuing operations grew by EUR 7.4 million to EUR 8.2 million (EUR 0.8 million). The growth in operating profit from continuing operations was affected significantly by timing the Crazy Days campaign differently from the comparison period. Net financial income and expenses decreased by EUR 0.4 million and were EUR 0.2 million negative (EUR 0.2 million). Profit before taxes was EUR 8.0 million, down EUR 0.7 million on the figure a year earlier. Profit from continuing operations before taxes grew by EUR 6.9 million. Direct taxes were EUR 1.9 million, an increase of EUR 1.6 million on the previous year. In the comparison period, earnings included EUR 7.4 million of tax-free capital gains. Net profit for the report period was EUR 6.1 million, compared with EUR 8.4 million a year earlier. Profit from continuing operations in the period increased by EUR 5.3 million. Earnings per share were EUR 0.11 (EUR 0.16) and diluted for options they were EUR 0.11 (EUR 0.15). Equity per share was EUR 9.14 (EUR 8.40). Sales and earnings trend by business segment The Department Store Division's sales grew by 19 per cent to EUR 281.2 million. Sales in Finland were up 22 per cent. Sales in Finland were increased substantially by running the Crazy Days campaign entirely in March. International Operations' sales were increased by the good like- for-like retail performance by the department stores in Russia and the Baltic countries, a fourth department store that was opened in Moscow in mid-February as well as the new Bestseller stores. At the beginning of the report period, problems were encountered in importing goods to Russia, but they were resolved towards the end of the report period. The problems led to a momentary shortage of goods, which slowed down sales growth. Sales by International Operations nonetheless grew by 12 per cent, and its share of the division's sales was 25 per cent (26 per cent). The relative share which International Operations occupy in the Department Store Division's sales, decreased in the first quarter because the Crazy Days campaign was not run at the department stores abroad until April. The Department Store Division's operating result improved by EUR 7.9 million and was EUR 7.8 million (a loss of EUR 0.1 million). The trend in earnings from operations in Finland was very profitable in the first quarter, mainly owing to the effect of timing the Crazy Days campaign. Earnings from International Operations were burdened by the start-up costs of the department store opened in Moscow in February as well as by the new Bestseller stores. On the other hand, sales and earnings at the department stores in Estonia and Latvia were on an upward curve. Hobby Hall reported sales growth of 6 per cent to EUR 55.6 million (EUR 52.6 million). Sales grew in both Finland and the Baltic countries. Online sales continued to grow buoyantly, accounting for 53 per cent of Hobby Hall's distance retailing sales in Finland (44 per cent). In the Baltic countries too, online sales showed strong growth. Thanks to the increase in the relative gross margin and effective cost management, Hobby Hall's operating profit improved by EUR 0.5 million and was EUR 1.5 million (EUR 1.0 million). Seppälä's sales increased by 7 per cent on the same period of last year and were EUR 34.6 million. Sales grew strongly in Russia and the Baltic countries, where they were boosted by the new stores that were opened towards the end of 2006 and at the beginning of 2007 as well as by the good like-for-like sales trend. Sales abroad grew by 42 per cent and their share of Seppälä's total sales rose to 27 per cent (21 per cent). The relative gross margin improved, but fixed costs and depreciation also increased because of the heavy investments in opening new stores. Seppälä's operating profit in the report period was on a par with the comparison period, or EUR 0.8 million. Financing and capital employed Liquid assets amounted to EUR 23.8 million at the end of the report period, as against EUR 14.5 million a year earlier and EUR 59.2 million at the end of 2006. Interest-bearing liabilities at the end of March were EUR 124.1 million (EUR 97.9 million), of which EUR 43.4 million consisted of long-term borrowings (EUR 13.4 million). EUR 20.0 million of new long-term borrowings was drawn down during the report period. Capital expenditures amounted to EUR 33.2 million. Net working capital amounted to EUR 244.6 million at the end of March, as against EUR 254.9 million a year earlier and EUR 194.5 million at the end of 2006. The dividend of EUR 72.1 million for the 2006 financial year, which was declared by a resolution of the Annual General Meeting on March 20, 2007, was paid out on March 30. Subscriptions made by exercising the share options for 2000 added EUR 3.1 million to shareholders' equity. The equity ratio was 63.0 per cent at the end of March (64.1 per cent). The equity ratio at the end of 2006 was 74.5 per cent. Gearing was 19.7 per cent at the end of March (18.4 per cent). At the end of 2006, gearing was 6.3 per cent negative. The return on capital employed over the past 12 months was 22.0 per cent (22.9 per cent at the end of 2006). The Group's capital employed increased by EUR 81.3 million from March of the previous year and stood at EUR 633.6 million towards the end of the report period (EUR 595.0 million at the end of 2006). Capital expenditures and current projects Capital expenditures during the report period totalled EUR 33.2 million (EUR 14.9 million). The construction works for the major enlargement and transformation project for the department store in the centre of Helsinki are continuing. The project involves expanding the department store's commercial premises by about 10 000 square metres by converting existing premises to commercial use and by building new retail space. In addition, completely new goods handling, servicing and customer parking areas will be built. After the enlargement the Helsinki department store will have a total of about 50 000 square metres of retail space. The total cost estimate for the project is approximately EUR 145 million. The works will be carried out stage by stage and are estimated to reach completion in 2010. During the report period, the project required an investment of about EUR 11.4 million. A new Stockmann Beauty store was opened in Joensuu in February. The fifteenth store in the Stockmann Beauty chain will be opened in Rovaniemi in the autumn. In February 2007, the Department Store Division opened a fourth department store in Moscow, in the Mega Shopping Centre on the south-east side of town. The department store has over 10 000 square metres of retail space. Stockmann's portion of the total costs of the department store, which was built in leased premises, were EUR 16.5 million, of which EUR 5.8 million was an outlay in the report period. Operations have started up according to plan. Four new Bestseller stores were opened in Russia in the report period: in St Petersburg, Moscow, Kazan and Samara. Stockmann now has a total of 15 Bestseller stores in Russia. The sixth Bestseller store in St Petersburg will be opened towards the end of April. Later this year, a second store will be opened in Samara, as well as one store each in Rostov-on-Don and Novosibirsk. The first two Stockmann Nike stores were opened in St Petersburg in February. Towards the end of the year, stores will be opened in Rostov-on- Don, Nizhny Novgorod, Novosibirsk and Samara. In 2006 Stockmann purchased a 10 000-odd square metre commercial plot on Nevsky Prospect, St Petersburg's high street. The plot is located next to the Vosstaniya Square underground station, in the immediate vicinity of Moscow Station. On this plot, Stockmann will erect the Nevsky Centre shopping centre that will have about 100 000 square metres of gross floor space, of which about 50 000 square metres will be store and office space. A full-scale Stockmann department store with about 20 000 square metres of retail space has been planned for the shopping centre, along with other retail stores, office premises and an underground car park. The department store and shopping centre investment will have a price tag of about EUR 135 million. On the plot for the Nevsky Centre development, the old buildings have been torn down, and the actual construction works are under way. The completion schedule for the building has been specified, and plans call for opening the department store and shopping centre in spring 2009. During the report period, the project required an investment of about EUR 8.2 million. Stockmann has signed a preliminary agreement on opening Moscow's fifth Stockmann department store in leased premises in the Metropolis Shopping Centre that is being built right near the city's centre. The department store will have a total of about 8 000 square metres of floor space, and Stockmann's investment in the project will be about EUR 12 million. The objective is to open the department store in autumn 2008. The Department Store Division's capital expenditures totalled EUR 30.4 million. Hobby Hall's capital expenditures amounted to EUR 0.6 million. Hobby Hall launched distance retailing in Lithuania in February 2007 and will start a similar launch in Russia towards the end of 2007. In April, Hobby Hall introduced a new distance retailing information system that will increase the efficiency of the company's commercial and administrative functions. Seppälä's capital expenditures came to EUR 2.0 million. Seppälä opened two stores in Russia during the report period. Seppälä's objective is to open further 10-15 stores in Latvia, Lithuania and Russia during 2007 and to start operations in Ukraine. Seppälä is presently upgrading its cash register system, which will become fully operational during the summer. Other capital expenditures in the report period amounted to EUR 0.2 million. Annual General Meeting The Annual General Meeting of Stockmann plc, held on March 20, 2007, passed a resolution to elect seven members to seats on the Board of Directors in accordance with the proposal by the Board's Appointments and Compensation Committee. Following the announcement by Lasse Koivu, Chairman of the Board of Directors, that he will no longer be available as a member of the company's Board of Directors, the Annual General Meeting re-elected Erkki Etola, managing director, Oy Etola Ab; Professor Eva Liljeblom; Kari Niemistö, managing director, Oy Selective Investor Ab; Christoffer Taxell, LL.M.; Carola Teir-Lehtinen, Senior Vice President, Corporate Communications, Fortum Corporation; and Henry Wiklund, managing director, Svenska litteratursällskapet I Finland r.f., to seats on the Board of Directors and elected Kaj-Gustaf Bergh, managing director, Föreningen Konstsamfundet r.f., as a new member for a period of office up to the end of the next Annual General Meeting. At its organization meeting on March 20, 2007, the Board of Directors elected Christoffer Taxell as its chairman and re-elected Erkki Etola as its vice chairman. The Board of Directors elected Christoffer Taxell chairman of the Appointments and Compensation Committee and re-elected as the other members of the committee Erkki Etola, Eva Liljeblom and Henry Wiklund. Elected as regular auditors were Jari Härmälä, Authorized Public Accountant, and Henrik Holmbom, Authorized Public Accountant. KPMG Wideri Oy Ab, Authorized Public Accountants, will continue as the deputy auditor. Under the new Companies Act, a shareholder who has not been registered in the book-entry system does not have the right to participate in a general meeting. Accordingly, the Annual General Meeting resolved to amend Article 12 of the Articles of Association in line with the new Companies Act. The Annual General Meeting passed a resolution to authorize the Board of Directors to decide on transferring a maximum of 373 134 of the company's own Series B shares (treasury shares) in one or more instalments. The authorization will be valid for five years. Shares and share capital The company's market capitalization at the end of March was EUR 1 826.7 million (EUR 1 788.1 million). At the end of 2006 the market capitalization was EUR 2 028.6 million. Stockmann's share prices underperformed both the OMX Helsinki index and the OMX Helsinki Cap index during the report period. At the end of March the stock exchange price of the Series A share was EUR 32.67, compared with EUR 36.40 at the end of 2006, and the Series B share was selling at EUR 32.73, as against EUR 36.48 at the end of 2006. The 192 865 Stockmann shares subscribed for in December 2006 with the share options for the year 2000 were entered in the Trade Register on February 28, 2007, and they were admitted to public trading on the Helsinki Stock Exchange together with existing shares on March 1, 2007. As a consequence of the subscriptions the share capital was increased by EUR 385 730. Following the increase, the share capital was EUR 111 709 806. At March 31, 2007, Stockmann had 24 564 243 Series A shares and 31 290 660 Series B shares. A total of 238 709 shares were subscribed for during January 1-March 30, 2007, with the share options for 2000. Of these, 18 000 shares were entered in the Trade Register on April 10, 2007 and they became available for public trading, together with the existing shares, on Helsinki Stock Exchange on April 11, 2007. As a consequence of the subscriptions the share capital was increased by EUR 36 000. In respect of 220 709 shares, the Board of Directors approved the subscriptions in its meeting on April 26, 2007. The share capital increase resulting from these subscriptions is EUR 441 418. After the above-mentioned increases, the share capital is EUR 112 187 224, with a total of 24 564 243 series A shares and 31 529 369 series B shares in issue. On the basis of the share options for the year 2000, it was possible to subscribe for a total of 2 500 000 new series B shares, and the options were exercised during the subscription period for a total of 2 499 800 series B shares. The subscription period ended on April 1, 2007. Stockmann held 373 134 of its own Series B shares (treasury shares) at the end of March 2007. They comprised 0.7 per cent of all the shares outstanding and 0.1 per cent of all the votes. The shares were bought back at a total price of EUR 5.6 million. The company's Board of Directors does not have valid authorizations to increase the share capital, to float issues of convertible bonds or bonds with warrants, or to buy back its own shares. Personnel strength During the report period, the Stockmann Group had an average payroll of 10 308 employees, or 322 more than in the comparison period. The number of employees was raised by the department stores and other stores in Russia and the Baltic countries, but lowered by the disposal of Stockmann Auto at the beginning of March 2006. Stockmann's average number of employees, converted to full-time staff, increased by 149 and was 8 259. At the end of March 2007, the number of staff working abroad was 3 790 people. At the end of March 2006, Stockmann had 3 064 people working abroad. The proportion of the total personnel who were working abroad was 34 per cent (32 per cent). Full-year outlook Major changes have not occurred in the operating environment, nor have operational risks changed materially from what was stated in the Annual Report. Retail sales are estimated to increase by about 3 per cent in Finland in 2007. The markets in Russia and the Baltic countries are set to continue growing faster than the Finnish market. Stockmann's sales are estimated to come in at about EUR 1.6 billion. Profit from continuing operations in the second quarter of 2007 will be weaker than in the previous year, because the Crazy Days campaign was run in the first quarter at the department stores in Finland. Profit from continuing operations in the comparison period was furthermore improved by a non-recurring capital gain of EUR 4.7 million. Earnings in 2006 included substantial non-recurring items as a consequence of the disposal of businesses. In 2007, these will be markedly smaller than in the previous year. The Group is carrying out a number of major investments. The start-up costs of the investments that will become operational during the year will be a factor burdening the result for 2007. Because of the decrease in non-recurring items, the Group's profit before taxes will come in lower than in 2006. The objective is, however, to post improved operating profit from continuing operations compared with 2006. Balance sheet, Group EUR millions 31.3.07 31.3.06 31.12.06 ASSETS Non-current assets Intangible assets 5.9 6.0 6.3 Property, plant and equipment 376.4 271.5 352.2 Available-for-sale investments 6.5 6.0 6.5 Deferred tax assets 2.5 3.4 2.5 Non-current assets, total 391.4 286.9 367.5 Current assets Inventories 181.3 190.3 155.0 Receivables, interest-bearing 100.8 108.1 98.9 Receivables, non interest-bearing 111.3 85.7 87.0 Cash and cash equivalents 23.8 14.5 59.2 Current assets, total 417.2 398.6 400.1 Assets classified as held for sale 22.9 Assets, total 808.6 708.4 767.6 EQUITY AND LIABILITIES Equity 509.5 454.4 571.6 Minority interest 0.0 0.0 0.0 Equity, total 509.5 454.4 571.6 Non-current liabilities, interest-bearing 43.4 13.4 23.4 Deferred taxes liabilities 26.2 26.9 26.2 Current liabilities Current liabilities, interest-bearing 80.7 84.5 Current liabilities, non interest-bearing 148.8 126.5 146.4 Current liabilities, total 229.5 211.0 146.4 Liabilities associated with assets 2.6 classified as held for sale Equity and liabilities, total 808.6 708.4 767.6 Equity ratio, per cent 63.0 64.1 74.5 Gearing, per cent 19.7 18.4 -6.3 Cash flow from operations per share, EUR -0.69 -0.58 2.15 Interest-bearing net debt, EUR mill. -0.5 -24.7 -134.7 Number of shares at March 31, thousands 55.855 54.483 55.662 Weighted average number of shares, 55.353 54.077 54.310 thousands Weighted average number of shares, 55.879 54.995 55.178 diluted, thousands Market capitalization, EUR mill. 1 826.7 1 788.1 2 028.6 Equity ratio, per cent = 100 x (Equity + minority interest) / Total assets less advance payments received Gearing, per cent = 100 x Interest-bearing liabilities less cash and cash equivalents / Equity total Interest-bearing net debt = Interest-bearing liabilities less cash and cash equivalents less interest-bearing liabilities Market capitalization, EUR mill. = Number of shares multiplied by the quotation for the respective share series on the balance sheet date Cash flow statement, Group EUR millions 1-3/2007 1-3/2006 1-12/2006 Cash flows from operating activities Net profit for the financial year 6.1 8.4 104.7 Adjustments: Deprecation 9.1 8.3 32.1 Other operating income -7.4 -34.4 Financial expenses 0.6 0.4 2.3 Financial income -0.4 -0.6 -1.8 Taxes paid 1.9 0.3 24.3 Other adjustments 0.8 -0.2 1.7 Changes in working capital: Change in trade and other receivables -22.3 4.6 1.7 Change in inventories -26.3 -30.1 5.2 Change in trade payables and other -2.0 -7.9 11.2 liabilities Interest paid -0.2 -0.7 -2.5 Interest received 0.4 0.6 1.1 Taxes paid -6.5 -7.4 -28.2 Net cash from operating activities -38.6 -31.7 117.4 Cash flows from investing activities Investments in tangible and intangible -33.1 -13.2 -112.2 assets Acquisition of subsidiary net cash -12.7 acquired Disposal of subsidiaries less cash at 45.7 105.0 date of disposal Capital expenditures on other investments -0.5 Cash from tangible assets 8.4 Cash from other investments 0.1 0.9 Dividends received 0.0 0.0 0.1 Net cash used in investing activities -33.1 32.6 -11.0 Cash flows from financing activities Proceeds from issue of share capital 3.8 0.1 17.2 Change in short-term loans, increase (+), 80.7 51.2 -33.3 decrease (-) Long-term loans, increase (+), decrease (- 20.0 10.0 ) Dividends paid -68.2 -56.2 -59.5 Net cash used in financing activities 36.3 -4.8 -65.6 Change in cash and cash equivalents -35.3 -3.9 40.8 Cash and cash equivalents at start of the 59.2 18.4 18.4 perod Cash and cash equivalents at end of the 23.8 14.5 59.2 period Income statement, 1-3/2007 Group, EUR millions Continuing Discontinued Total operations operations Revenue 311.4 311.4 Other operating income Materials and consumables -191.6 -191.6 Wages, salaries and employee benefits -50.8 -50.8 expenses Depreciation -9.1 -9.1 Other operating expenses -51.7 -51.7 Operating profit 8.2 8.2 Finance income and expenses -0.2 -0.2 Profit before tax 8.0 8.0 Income taxes -1.9 -1.9 Profit for the period 6.1 6.1 Earnings per share, EUR 0.11 0.11 Earnings per share, diluted, EUR 0.11 0.11 Operating profit, per cent 2.6 2.6 Equity per share, EUR 9.14 Return on equity, per cent, moving 12 21.2 months Return on capital employed, per cent, 22.0 moving 12 months Average number of employees, converted 8.259 8.259 to full-time staff Investments 33.2 33.2 Income statement, 1-3/2006 Group, EUR millions Continuing Discontinued Total operations operations Revenue 269.4 61.1 330.5 Other operating income 0.0 7.4 7.4 Materials and consumables -168.7 -52.5 -221.2 Wages, salaries and employee -48.3 -5.4 -53.7 benefits expenses Depreciation -8.0 -0.3 -8.3 Other operating expenses -43.7 -2.6 -46.2 Operating profit 0.8 7.7 8.5 Finance income and expenses 0.2 0.0 0.2 Profit before tax 1.1 7.7 8.7 Income taxes -0.3 -0.1 -0.3 Profit for the period 0.8 7.6 8.4 Earnings per share, EUR 0.02 0.14 0.16 Earnings per share, diluted, EUR 0.01 0.14 0.15 Operating profit, per cent 0.3 12.6 2.6 Equity per share, EUR 8.40 Return on equity, per cent, moving 19.4 12 months Return on capital employed, per 21.6 cent, moving 12 months Average number of employees, 7 655 456 8 112 converted to full-time staff Investments 14.9 14.9 Income statement, 1-12/2006 Group, EUR millions Continuing Discontinued Total operations operations Revenue 1 239.6 61.1 1 300.7 Other operating income 5.1 29.3 34.4 Materials and consumables -721.1 -52.5 -773.6 Wages, salaries and employee -199.3 -5.4 -204.7 benefits expenses Depreciation -31.8 -0.3 -32.1 Other operating expenses -192.6 -2.6 -195.1 Operating profit 99.9 29.6 129.5 Finance income and expenses -0.5 0.0 -0.6 Profit before tax 99.4 29.6 128.9 Income taxes -24.2 -0.1 -24.3 Profit for the period 75.2 29.5 104.7 Earnings per share, EUR 1.39 0.54 1.93 Earnings per share, diluted, EUR 1.37 0.53 1.90 Operating profit, per cent 8.1 48.4 10.0 Equity per share, EUR 10.34 Return on equity, per cent, moving 19.4 12 months Return on capital employed, per 22.9 cent, moving 12 months Average number of employees, 7 923 114 8 037 converted to full-time staff Investments 125.5 125.5 Earnings per share, EUR = (Profit before taxes - minority interest - income taxes) / Average number of shares, adjusted for share issues Return on equity, per cent, moving 12 months = 100 x Profit for the period (12 months) / (Equity + minority interest) (average over 12 months) Return on capital employed, per cent, moving 12 months = 100 x (Profit before taxes + interest and other financial expenses) (12 months) / Capital employed (average over 12 months) SEGMENT INFORMATION Segments Sales, EUR millions 1-3/2007 1-3/2006 Change 1-12/2006 per cent Department Store Division 281.2 235.8 19 1 119.0 Hobby Hall 55.6 52.6 6 199.8 Seppälä 34.6 32.4 7 158.1 Shared 0.2 0.2 2 0.9 Continuing operations, total 371.7 320.9 16 1 477.8 Discontinued operations 74.8 74.8 Group 371.7 395.7 -6 1 552.6 Revenue, EUR millions 1-3/2007 1-3/2006 Change 1-12/2006 per cent Department Store Division 236.3 198.5 19 941.3 Hobby Hall 46.2 43.6 6 165.9 Seppälä 28.7 26.8 7 130.8 Shared 0.1 0.5 -79 1.7 Continuing operations, total 311.4 269.4 16 1 239.6 Discontinued operations 61.1 61.1 Group 311.4 330.5 -6 1 300.7 Operating profit, EUR 1-3/2007 1-3/2006 Change 1-12/2006 millions per cent Department Store Division 7.8 -0.1 79.5 Hobby Hall 1.5 1.0 49 7.1 Seppälä 0.8 0.8 1 21.1 Shared -1.8 -1.4 -8.0 Eliminations 0.0 0.6 0.2 Continuing operations, total 8.2 0.8 99.9 Discontinued operations 7.7 29.6 Group 8.2 8.5 -4 129.5 Investments, gross, EUR millions 31.3.07 31.3.06 Change 31.12.06 per cent Department Store Division 30.4 12.8 138 115.3 Hobby Hall 0.6 0.7 -24 3.2 Seppälä 2.0 1.2 69 6.1 Shared 0.2 0.2 9 0.9 Continuing operations, total 33.2 14.9 123 125.5 Discontinued operations Group 33.2 14.9 123 125.5 Assets, EUR millions 31.3.07 31.3.06 Change 31.12.06 per cent Department Store Division 633.2 485.0 31 557.9 Hobby Hall 111.6 111.1 0 104.0 Seppälä 36.3 29.1 25 38.0 Shared 27.5 60.4 -54 67.7 Continuing operations, total 808.6 685.5 18 767.6 Discontinued operations 22.9 Group 808.6 708.4 14 767.6 Non-interest-bearing 31.3.07 31.3.06 Change 31.12.06 liabilities, EUR millions per cent Department Store Division 116.3 98.7 18 122.0 Hobby Hall 20.0 18.8 6 13.9 Seppälä 5.3 3.9 37 10.9 Shared 33.4 29.5 13 25.8 Continuing operations, total 175.0 150.8 16 172.6 Discontinued operations 2.6 Group 175.0 153.5 14 172.6 Market areas 1-3/2007 Continuing Discontinued Total Sales, EUR millions operations operations Finland 1) 281.4 281.4 Baltic states 2) 43.0 43.0 Russia 3) 47.3 47.3 Group 371.7 371.7 Finland, per cent 75.7 75.7 International operations, per cent 24.3 24.3 Continuing Discontinued Total Revenue, EUR millions operations operations Finland 1) 234.3 234.3 Baltic states 2) 36.6 36.6 Russia 3) 40.5 40.5 Group 311.4 311.4 Finland, per cent 75.2 75.2 International operations, per cent 24.8 24.8 Continuing Discontinued Total Operating profit, EUR millions operations operations Finland 1) 10.8 10.8 Baltic states 2) 2.5 2.5 Russia 3) -5.2 -5.2 Group 8.2 8.2 Finland, per cent 132.2 132.2 International operations, per cent -32.2 -32.2 Investments, 31.3.2007 gross, EUR millions Continuing Discontinued Total operations operations Finland 1) 14.3 14.3 Baltic states 2) 0.6 0.6 Russia 3) 18.3 18.3 Group 33.2 33.2 Finland, per cent 43.1 43.1 International operations, per cent 56.9 56.9 Continuing Discontinued Total Assets, EUR millions operations operations Finland 1) 567.3 567.3 Baltic states 2) 74.1 74.1 Russia 3) 167.3 167.3 Group 808.6 808.6 Finland, per cent 70.2 70.2 International operations, per cent 29.8 29.8 1) Department Store Divisions, Stockmann Auto, Hobby Hall and Seppälä 2) Department Store Divisions, Stockmann Auto, Hobby Hall and Seppälä 3) Department Store Divisions and Seppälä Market areas 1-3/2006 Continuing Discontinued Total Sales, EUR millions operations operations Finland 1) 242.6 74.8 317.5 Baltic states 2) 36.6 36.6 Russia 3) 41.7 41.7 Group 320.9 74.8 395.7 Finland, per cent 75.6 80.2 International operations, per cent 24.4 19.8 Continuing Discontinued Total Revenue, EUR millions operations operations Finland 1) 202.6 61.1 263.7 Baltic states 2) 31.1 31.1 Russia 3) 35.7 35.7 Group 269.4 61.1 330.5 Finland, per cent 75.2 79.8 International operations, per cent 24.8 20.2 Continuing Discontinued Total Operating profit, EUR millions operations operations Finland 1) 0.9 7.7 8.6 Baltic states 2) 1.3 1.3 Russia 3) -1.4 -1.4 Group 0.8 7.7 8.5 Finland, per cent 114.8 101.4 International operations, per cent -14.8 -1.4 Investments, 31.3.2006 gross, EUR millions Continuing Discontinued Total operations operations Finland 1) 9.0 9.0 Baltic states 2) 0.2 0.2 Russia 3) 5.7 5.7 Group 14.9 14.9 Finland, per cent 60.4 60.4 International operations, per cent 39.6 39.6 Continuing Discontinued Total Assets, EUR millions operations operations Finland 1) 524.0 524.0 Baltic states 2) 73.8 73.8 Russia 3) 87.7 22.9 110.6 Group 685.5 22.9 708.4 Finland, per cent 76.4 74.0 International operations, per cent 23.6 26.0 1) Department Store Divisions, Stockmann Auto, Hobby Hall and Seppälä 2) Department Store Divisions, Stockmann Auto, Hobby Hall and Seppälä 3) Department Store Divisions and Seppälä Market areas 1-12/2006 Continuing Discontinued Total Sales, EUR millions operations operations Finland 1) 1 123.7 74.8 1 198.6 Baltic states 2) 165.3 165.3 Russia 3) 188.8 188.8 Group 1 477.8 74.8 1 552.6 Finland, per cent 76.0 77.2 International operations, per cent 24.0 22.8 Continuing Discontinued Total Revenue, EUR millions operations operations Finland 1) 937.5 61.1 998.5 Baltic states 2) 140.6 140.6 Russia 3) 161.6 161.6 Group 1 239.6 61.1 1 300.7 Finland, per cent 75.6 76.8 International operations, per cent 24.4 23.2 Continuing Discontinued Total Operating profit, EUR millions operations operations Finland 1) 75.2 7.7 82.9 Baltic states 2) 21.0 21.0 Russia 3) 3.8 21.9 25.6 Group 99.9 29.6 129.5 Finland, per cent 75.2 64.0 International operations, per cent 24.8 36.0 Investments, 31.12.2006 gross, EUR millions Continuing Discontinued Total operations operations Finland 1) 64.0 64.0 Baltic states 2) 1.8 1.8 Russia 3) 59.7 59.7 Group 125.5 125.5 Finland, per cent 51.0 51.0 International operations, per cent 49.0 49.0 Continuing Discontinued Total Assets, EUR millions operations operations Finland 1) 594.8 594.8 Baltic states 2) 69.7 69.7 Russia 3) 103.1 103.1 Group 767.6 767.6 Finland, per cent 77.5 77.5 International operations, per cent 22.5 22.5 1) Department Store Divisions, Stockmann Auto, Hobby Hall and Seppälä 2) Department Store Divisions, Stockmann Auto, Hobby Hall and Seppälä 3) Department Store Divisions and Seppälä Statement of changes Share in equity premium Legal Group, EUR millions Equity* fund reserve Equity December 31, 2005 109.0 166.5 0.2 Options exercised 0.1 Dividends Translation differences Profit for the period Equity March 31, 2006 109.0 166.6 0.2 Equity December 31, 2006 111.7 183.4 0.2 Options exercised 0.5 2.6 Share bonus 0.2 Transfer to other funds 0.0 Cost of share issue Dividends Translation differences Profit for the period Equity March 31, 2007 112.2 186.2 0.2 * including share issue Statement of changes Trans- in equity Other lation Retained Group, EUR millions funds** reserve earnings Equity December 31, 2005 43.9 0.0 185.7 Options exercised 0.1 Dividends -59.5 Translation differences 0.0 0.0 Profit for the period 8.4 Equity March 31, 2006 43.9 0.0 134.7 Equity December 31, 2006 43.9 0.0 232.3 Options exercised Share bonus 0.1 Transfer to other funds Cost of share issue 0.5 Dividends -72.1 Translation differences 0.0 0.0 Profit for the period 6.1 Equity March 31, 2007 43.9 0.0 167.0 ** excluding deferred tax liability Statement of changes in equity Minority Group, EUR millions Total interest Total Equity December 31, 2005 505.2 0.0 505.3 Options exercised 0.3 0.3 Dividends -59.5 -59.5 Translation differences 0.0 0.0 Profit for the period 8.4 0.0 8.4 Equity March 31, 2006 454.4 0.0 454.4 Equity December 31, 2006 571.6 0.0 571.6 Options exercised 3.1 3.1 Share bonus 0.3 0.3 Transfer to other funds 0.0 0.0 Cost of share issue 0.5 0.5 Dividends -72.1 -72.1 Translation differences 0.0 0.0 Profit for the period 6.1 0.0 6.1 Equity March 31, 2007 509.5 0.0 509.5 Contingent liabilities, 31.3.07 31.3.06 31.12.06 Group EUR millions Mortgages on land and 1.7 1.7 1.7 buildings Guarantees 1.5 1.5 Pledges 0.1 0.1 0.1 Total 3.3 1.7 3.2 Lease agreements on business premises, EUR millions Minimum rents payable on the basis of binding lease agreements on business premises Within one year 69.9 49.7 69.6 After one year 342.9 372.4 351.5 Total 412.8 422.1 421.1 Lease payments Within one year 1.0 0.9 1.1 After one year 0.9 0.8 0.9 Total 1.9 1.7 2.0 Derivative instruments Nominal value Interest rate derivatives 5.3 Exchange rates Country Currency 31.3.07 31.3.06 31.12.06 Russia RUB 34.6580 33.5460 34.6800 Estonia EEK 15.6466 15.6466 15.6466 Latvia LVL 0.7097 0.6961 0.6972 Lithuania LTL 3.4528 3.4528 3.4528 Income statement quarterly, Q1 Q4 Q3 Q2 Group, EUR millions 2007 2006 2006 2006 Continuing operations Revenue 311.4 389.6 281.1 299.5 Other operating income 0.0 0.4 0.0 4.7 Materials and consumables -191.6 -215.6 -166.1 -170.8 Wages, salaries and -50.8 -57.9 -44.2 -48.9 employee benefits expenses Depreciation -9.1 -7.9 -7.9 -8.1 Other operating expenses -51.7 -58.1 -43.0 -47.7 Operating profit 8.2 50.5 19.8 28.7 Finance income and expenses -0.2 -0.5 0.5 -0.9 Profit before tax 8.0 50.1 20.4 27.9 Income taxes -1.9 -12.3 -5.0 -6.6 Profit for the period, 6.1 37.8 15.4 21.2 continuing operations Discontinued operations Profit for the period, 21.9 discontinued operations Profit for the period 6.1 37.8 15.4 43.1 Earnings per share, continuing operations, EUR Basic 0.11 0.70 0.29 0.39 Diluted 0.11 0.69 0.28 0.39 Earnings per share, discontinued operations, EUR Basic 0.00 -0.01 0.41 Diluted -0.01 0.00 0.40 Earnings per share, total, EUR Basic 0.11 0.70 0.28 0.80 Diluted 0.11 0.68 0.28 0.79 Q1 Q4 Q3 Q2 Sales, EUR millions 2007 2006 2006 2006 Department Store Division 281.2 363.4 249.0 270.8 Hobby Hall 55.6 55.5 45.5 46.2 Seppälä 34.6 45.3 40.2 40.2 Shared 0.2 0.2 0.2 0.3 Continuing operations, 371.7 464.4 334.9 357.6 total Discontinued operations Group 371.7 464.4 334.9 357.6 Revenue, EUR millions Department Store Division 236.3 305.5 209.8 227.4 Hobby Hall 46.2 46.1 37.8 38.4 Seppälä 28.7 37.5 33.2 33.3 Shared 0.1 0.5 0.2 0.4 Continuing operations, 311.4 389.6 281.1 299.5 total Discontinued operations Group 311.4 389.6 281.1 299.5 Operating profit, EUR millions Department Store Division 7.8 44.3 13.1 22.2 Hobby Hall 1.5 3.4 2.1 0.6 Seppälä 0.8 7.3 5.4 7.6 Shared -1.8 -3.8 -0.9 -1.9 Eliminations 0.0 -0.6 0.1 0.2 Continuing operations, 8.2 50.6 19.8 28.7 total Discontinued operations 21.9 Group 8.2 50.6 19.8 50.6 Income statement quarterly, Q1 Q4 Q3 Q2 Group, EUR millions 2006 2005 2005 2005 Continuing operations Revenue 269.4 379.3 262.0 274.0 Other operating income 0.0 7.0 0.0 0.0 Materials and consumables -168.7 -214.3 -155.7 -156.6 Wages, salaries and -48.3 -56.5 -41.8 -45.6 employee benefits expenses Depreciation -8.0 -8.7 -6.7 -7.3 Other operating expenses -43.7 -52.8 -40.2 -41.7 Operating profit 0.8 53.9 17.5 23.1 Finance income and expenses 0.2 -2.0 0.6 -0.5 Profit before tax 1.1 52.0 18.2 22.5 Income taxes -0.3 -13.3 -4.7 -5.6 Profit for the period, 0.8 38.6 13.5 16.9 continuing operations Discontinued operations Profit for the period, 7.6 3.7 2.0 1.0 discontinued operations Profit for the period 8.4 42.4 15.4 17.9 Earnings per share, continuing operations, EUR Basic 0.01 0.72 0.25 0.32 Diluted 0.01 0.71 0.25 0.31 Earnings per share, discontinued operations, EUR Basic 0.14 0.07 0.04 0.02 Diluted 0.14 0.07 0.04 0.02 Earnings per share, total, EUR Basic 0.15 0.79 0.29 0.34 Diluted 0.15 0.78 0.29 0.33 Q1 Q4 Q3 Q2 Sales, EUR millions 2006 2005 2005 2005 Department Store Division 235.8 344.3 228.4 244.4 Hobby Hall 52.6 63.4 43.9 42.7 Seppälä 32.4 45.1 40.1 39.9 Shared 0.2 0.2 0.2 0.2 Continuing operations, 320.9 453.1 312.6 327.3 total Discontinued operations 74.8 117.4 109.6 130.6 Group 395.7 570.5 422.3 457.9 Revenue, EUR millions Department Store Division 198.5 289.0 191.9 204.8 Hobby Hall 43.6 52.6 36.4 35.5 Seppälä 26.8 37.3 33.1 32.9 Shared 0.5 0.5 0.6 0.8 Continuing operations, 269.4 379.3 262.0 274.0 total Discontinued operations 61.1 96.4 89.9 106.8 Group 330.5 475.7 351.9 380.9 Operating profit, EUR millions Department Store Division -0.1 37.8 12.1 15.2 Hobby Hall 1.0 4.3 0.9 0.2 Seppälä 0.8 14.5 6.9 8.4 Shared -1.4 -3.3 -1.4 -1.5 Eliminations 0.6 0.6 -0.9 0.7 Continuing operations, 0.8 53.9 17.5 23.1 total Discontinued operations 7.7 4.1 1.9 1.5 Group 8.5 58.0 19.5 24.6 STOCKMANN plc Hannu Penttilä CEO DISTRIBUTION Helsinki Stock Exchange Principal media A press and analyst conference will be held today, April 26, 2007, at 14.00 at the World Trade Center, Aleksanterinkatu 17, Helsinki.