JSC “Riga Shipyard” directorship explanation for 2007 6 months financial report

In the current financial report for 6 months of the year 2007 the position      
“Accumulated incomes” has been indicated that has not been estimated in the     
finanacial report for 6 months of the last year as it was estimated once a year 
only, at the end of it.                                                         
The “Accumulated incomes” position reflects the interprise's incomes ganed from 
the orders in the newbuilding sphere that depend mostly from the long-term      
contracts readiness .Starting from the year 2007 the above mentioned position   
will be estimated every quarter.                                                
In order for given information to be compared, the showing for “Accumulated     
incomes” position for 6 of the year 2006 have been estimated according to the   
showing of the year 2007. As a result, the difference with the showing of the   
year 2006 has appeared.                                                         


JSC “Riga Shipyard”                                                           
Member of Board
A.Stolders