F o r th e y ea r en d in g o n D ec em b er 31,

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3 B A L A N C E S H E E T F o r th e y ea r en d in g o n D ec em b er 31, In LTL th o u sa n d s, u n less o th erw ise sta ted C o m p a n y A S S E T S N o te N u m. G ro u p F ix e d a sse ts 1 4 In ta n g ib le a ssets Ta n g ib le a s s ets F in a n c ia l a s s ets R ec eiv a b les fro m su b sid ia ries a n d a sso c ia ted c o m p a n ies A c c o u n ts rec eiv a b le a fter o n e y ea r F ix e d a sse ts in to ta l C u rre n t a sse ts In v en to ries, p rep a y m en ts, 38 7 a n d u n fin ish ed a g reem en ts A c c o u n ts rec eiv a b le in o n e y ea r O th er sh o rt term a ssets C a sh o r c a sh eq u iv a len ts C u rre n t a sse ts in to ta l A sse ts in to ta l C o m p a n y S H A R E H O L D E R E Q U IT Y A N D L IA B IL IT IE S N o te N u m. G ro u p S h a re h o ld e r e q u ity S h a re c a p ita l R ev a lu a tio n reserv e (n et) R eserv es R eta in ed ea rn in g s (19.779) - - C u rren c y tra n sla tio n effec t (30 ) S h a re h o ld e r e q u ity in to ta l M in o rity sh a re D o n a tio n s a n d su b sid ie s L ia b ilitie s L o n g term lia b ilities a n d a c c o u n ts p a y a b le a fter o n e y ea r S h o rt term lia b ilities a n d a c c o u n ts p a y a b le w ith in o n e y ea r L ia b ilitie s in to ta l S h a re h o ld e r e q u ity a n d lia b ilitie s in to ta l M G B A LTIC G ro u p

4 P ROFIT / LOSS For the year ending on December 31, 2005 In LTL thousands, unless otherwise stated Note Num Net sales (100) (100) Cost of sales ( ) ( ) Gross prof it (1.580) (1.307) Operating ex penses 14 ( ) ( ) Operating prof it Other activities net result (206) Financial activities net result 16 (15.599) (296) - - Results from associated companies (1.201) P rof it f rom ordinary ac tiv ities Ex traordinary gain Ex traordinary loss P rof it bef ore taxes (35) (65) Income tax (7.092) (6.863) - - Minority share (9.116) (10.886) Net prof it

5 CASH FLOW STATEMENT For the year ending on December 31, 2005 In LTL thousands, unless otherwise stated Cash flow s from operating activities Net profit (loss) Minority share Depreciation and amortiz ation (Increase) decrease in amounts receivable after one year (1.854) (Increase) decrease in inventory (8.749) (Increase) decrease in prepaid expenses - (35) and unfinished agreements (637) (Increase) decrease in trade accounts receivable (31.660) (2.650) (Increase) decrease in receivables from subsidiaries (33) 51 and associated companies (2) (Increase) decrease in other accounts receivable (Increase) decrease in other short term assets 402 (2.385) Increase (decrease) in long-term debt to suppliers - - and prepayments received Increase (decrease) in short term debt to suppliers (448) 388 and prepayments received (9.309) (65) 8 Increase (decrease) in taxes payable Increase (decrease) in labor-related liabilities Increase (decrease) in provisions Increase (decrease) in other liabilities and accounts payable (4.415) (793) 206 Adjusting for results from financial activities (17.494) (2) - Profit (loss) from sales of fixed assets (8.095) - (367) 798 Cash flow from operating activities Cash flow from investment activities (358) (33) Purchase of fixed assets (excluding investments) (76.165) (39.800) 15 - Sales of fixed assets (excluding investments) Purchase of investments into subsidiaries - (1.546) and associated companies (10.022) - Sales of investments into subsidiaries - - and associated companies (Purchase) sales of other long term investments - (2.139) (4.060) Loans given (returned) (30.618) (37.813) Dividends and interest received Other increase (decrease) in cash flows from investment activities (11.327) (1.317) (5.639) Cash flow s form investment activities (81.519) (78.438) Cash flow s from financing activities - - Dividends paid (2.883) (653) (4.140) Received (repaid) financial loans Bonds issued Bonds repaid (7.000) Received donations and subsidies Payments under leasing agreements (321) (4.545) (202) (206) Interest paid (13.593) Other increase (decrease) in cash flows from financing activities (146) (4.342) Cash flow s form investment activities Net increase (decrease) in cash and cash equivalents (1.896) Cash and cash equivalents at the beginning of the year Cash and cash equivalents at the end of the year

6 RECONCILIATION OF MOV EMENTS IN SHAREHOLDERS' FU NDS For the year ending on December 31, 2005 In LTL thousands, unless otherwise stated Share capital Revaluation reserve (net) Reserves implied by law Other reserves Retained earnings Currency translation effect Total Opening balance on Increase / decrease in value of fixed assets Net profit for the financial year Transfers to reserves 10 (10) - Transfers from reserves - Currency translation effect - - Closing balance on Share capital Revaluation reserve (net) Reserves implied by law Other reserves Retained earnings Currency translation effect Total Opening balance on (19.779) Increase / decrease in value of fixed assets (14.544) Net profit for the financial year Transfers to reserves Transfers from reserves (3.850) (12.325) Currency translation effect (30) (30) - Closing balance on (30)

7 GENERAL INFORMATION Name UAB K oncernas MG Baltic Form of company Joint-stock company Registered in: The national company registry of the Republic of Lithuania Registration date: 12 January 2000 No: VAT code LT Registered capital LTL Central premises J.Jasinsk io street 16, Vilnius Financial year In line with calendar year President Darius Juozas Mock us Director of economics and finance Vidas Lazick as UAB K oncernas MG Baltic has issued and registered capital equal to Lithuanian litas (LTL). The registered capital is divided into ordinary registered shares. The nominal value of one share is 1 LTL. All shares of the UAB K oncernas MG Baltic belong to Darius Juozas Mock us. At the end of 2005, UAB K oncernas MG Baltic and its subsidiaries had in total 2456 employees. 30

8 MG BALTIC GROUP STRUCTURE UAB KONCERNAS MG BALTIC Voting rights in the company 50 % Voting rights in the company 66,67 % Voting rights in the company 97,66 % UAB MG BALTIC TRADE UAB MG V ALDA (Registered capital Lt) UAB MG BALTIC INV ESTMENT 98,39 % UAB MINERALINIAI VANDENY S AB STUMBRAS AB BIOFUTURE UAB TROMINA UAB DIDNERIAI UAB TROJINA 99,40 % 99,40 % 92,79 % 50 % 37,5 % 50 % UAB TENISO PASAULIS UAB MEGARENTA UAB TROJA SIA AMMO SIA Industrial and Logistics centre LAPEGLES 52,46 % APB APRANGA SIA APRANGA SIA APRANGA LV OÜ APRANGA ESTONIA UAB APRANGA LT UAB APRANGA BPB LT UAB PREKY BOS MARKETINGO PASLAUGOS SIA CELTNIECIBAS PASAULE UAB MG BALTIC MEDIA 75 % SIA PARK MV SIA DOMMO UAB NEO-PRESS 98,55 % UAB LAISVAS IR NEPRIKLAUSOMAS KANALAS 80 % UAB TV1 47,89 % AB LË VUO 31

9 SUMMARY OF MAJOR ACCOUNTING PRINCIPLES Accounting policy In 2004, by the decision of the president of UAB Koncernas MG Baltic, the accounting policy of the UAB Koncernas MG Baltic was confirmed. Based on this accounting policy, each company in the has prepared its own accounting policy, to which it adheres as long as it complies with the legislation of the Republic of Lithuania and legislation of foreign countries. In 2005, the accounting policy was reviewed and amended to comply with new requirements of local accounting standards. Principles of consolidation UAB Koncernas MG Baltic consolidated financial accounting is prepared according to the Law of Consolidated Financial Accounting in the Republic of Lithuania, the Business Accounting Standards, and the accounting policy of companies under UAB Koncernas MG Baltic. The subsidiaries operating abroad have prepared the financial accounts for consolidation according to the accounting policy for companies under the UAB Koncernas MG Baltic. Subsidiaries are consolidated from the date of acquisition, when the control over the company is transferred to the, and they stop being consolidated from the day when the subsidiary is sold. All the transactions among the companies are eliminated in the consolidated financial accounts. The minority share is reported as a separate item in the consolidated financial accounts. Subsidiaries and associated companies Subsidiaries are the companies, in which the (directly or indirectly) has more than a half of the voting rights or has a crucial influence to the company, its management or financial and operational activities, and where the receives benefits. Associated companies are companies that are not subsidiaries of the, but in which MG Baltic group, directly or indirectly, controls 20% or more of the voting rights and has a significant influence other the activities of the companies. Until the end of this accounting period, subsidiaries and associated companies in UAB Koncernas MG Baltic accounts were recognized using equity method. Local accounting standard No. 15 Investment to associated companies and local accounting standard No. 16 Consolidated financial reporting and investments to subsidiaries have been amended allowing for the reporting company to choose between equity and cost methods when preparing its separate financial statements provided that the reporting company has subsidiaries and prepares consolidated financial statements. Based on the amendment, MG Baltic accounting policy was changed and in financial reports of UAB Koncernas MG Baltic as a the investments to subsidiaries and associated companies are recognized using cost method. In consolidated financial accounts, associated companies for the MG Baltic are recognized using equity method. Investments Investments to shares of other companies, provided that those investments do not allow the to have significant influence in the company, or if the shares of the company were acquired with a clear goal of reselling, are recognized using cost method as short-term investments. 32

10 Recognition of income Income is recognized as soon as the goods are sold or services rendered to the customers and when there is evidence that the economic gains from the transaction will be realized, as well as the amount of income can be clearly defined. The sales income is accounted using accrual principle and evaluated at its fair value, taking into account the discounts, and goods returned and revalued. Cost of sales and operating expenses The expenses are accounted using the accrual and matching principles at the accounting period as the income is earned, regardless the actual time of expenditure. Only the part of past and current expenditure that matches earnings for the current period is recognized as expenses. The expenditures that are made for the future earnings are registered as assets. The share of assets, which will generate income in the future periods, will be transferred to the expenses in the respective future periods. Currency and rounding The financial accounts are presented in Lithuanian litas (LTL), rounded to thousand. Transactions that are implemented using foreign currency are recognized using the exchange rate in effect at the date of the transaction. For the consolidation purposes the income and expenses of foreign subsidiaries are converted to Lithuanian litas using the average exchange rate of the year, and their balances are converted using the exchange rate on the 31 of January. Litas is pegged to the euro at the rate of LTL 3,4528 to EUR 1 since February Intangible fixed assets Intangible assets, from which the company is expecting to have economic benefits in the future, are accounted at the purchasing cost less the accumulated amortization and reduction in value. Amortization is calculated using straight-line method. The amortization of intangible assets is recognized as expenses every accounting period. The terms set for the amortization of intangible assets using the following periods: Licenses Computer software Other intangible assets 1-6 years 3-6 years 3-5 years Goodwill Goodwill is calculated as difference between cost of acquisition and fair value of the assets acquired at the moment of the acquisition. The goodwill from acquisition of subsidiaries is recognized in intangible assets in the consolidated balance sheet of the. The goodwill from acquisition of associated companies is recognized as a part of the investment value. 5 year term is set for amortization of goodwill, using the straight-line method. 33

11 Tangible fixed assets Fixed assets are accounted at the acquisition cost or revaluation cost (in case the asset was revalued) less the accumulated depreciation and reduction in value. The depreciation is calculated using the straight-line method, writing off the acquisition value to the liquidation value. The depreciation of tangible assets is recognized as expenses every accounting period. The terms set for the depreciation of tangible assets using the following periods: Buildings Machinery and equipment Vehicles Other equipment, machinery and tools Other tangible fixed assets 5-50 years 5-20 years 4-10 years 3-10 years 4 years Construction in progress is recognized at its acquisition value. The depreciation is not calculated for the construction in progress until the construction is finished. Inventory Inventory items are accounted for at the acquisition (production) cost. When the financial accounts are prepared, the inventories are reported at acquisition (production) costs or at the net realizable value, depending on which is the lowest. Inventories acquired by foreign currency are accounted for using the exchange rate as it was on the day of acquisition between Lithuanian litas and the respective foreign currency. The cost of inventories used in production or sold is calculated using the FIFO method. Accounts receivable Accounts receivable are reported in the balance sheet at their net value, i.e., the accounting value less the irrecoverable sums. The accounting value is reduced when there is sufficient evidence that the companies will not be able to recover the amounts on the time planned. Financial liabilities Financial loans are accounted as the sum of money received, regardless the expenses incurred for the preparation and execution of the transaction. Long term liabilities are obligations, which the companies have to fulfill in more than one year from the date of the balance sheet preparation. The current liabilities are included in the long term liabilities, if their terms are extended or there is a refinancing agreement for a longer term than one-year period. Current liabilities are those, which have to be fulfilled during one cycle of the company's ordinary activities, or in one year from the day of balance sheet preparation. Current liabilities include the share of the long term liabilities that must be repaid in one year. 34

12 Leasing Leasing is recognized when according to the leasing agreement all the risk and utility, relating to the asset in consideration, is transferred to the companies. In case a significant part of the risk and utility, relating to the asset in consideration, is left to the lessor, the transaction is recognized as operational leasing. Taxes UAB Koncernas MG Baltic subsidiaries account for, and pay the taxes according to the tax legislation of the country, in which the company is registered and operates. The companies that are registered in Lithuania have agreements made with UAB Mokesè iø ekspertø biuras for the audit of tax calculation and audit of fairness of tax payment. Provisions In the financial reports the provisions are recognized separately from other liabilities. Provisions are calculated when, as a result of past events, UAB Koncernas MG Baltic or companies have a legal obligation or irreversible pledge, the value of which can be estimated confidently, and for which to cover, assets will have to be used. Liabilities are recognized as provisions only if the future expenses are inevitable, regardless the activities of the company in the future. For any date of the balance sheet the provisions are revised and their values are corrected as implied by new facts or circumstances. Dividends The decisions of the companies concerning dividends, which are payable from the previous financial year earnings, are reported in the current year statements. Dividends that are paid among companies within the are eliminated in the consolidated accounts. Transfers between articles To assure comparability, some amounts in financial reports for 2004 were reclassified between articles to be comparable to the amounts in the financial reports for Explanation of the terminology used defined as a separate company UAB Koncernas MG Baltic. the consists of mother company UAB Koncernas MG Baltic and companies that, directly or indirectly via subsidiaries, belong to the. 35

13 NOTES ON FINANCIAL ACCOUNTS In LTL thousands, unless otherwise stated 1. Main indicators by activity and geographical segments Business seg m ent a separated part of business, in which separate or related products are being produced or separate or related services are rendered, and the business risk as well as profitability is different from the other parts of business within the. companies are engaged in following activity groups: a) Production alcoholic and non-alcoholic beverages, ethyl alcohol, and bio-ethanol; b) Trade of alcoholic beverages, tobacco, food, clothing, toys and other fast moving consumer goods; c) Provision of logistics, real estate development and renting services, also, mass-media, events organizing, sports, and sales marketing. Main indicators by the activity group are given in the tables below: 2005 Production Trade Services Sales Cost of goods sold Operating expenses Fixed assets Current assets Production Trade Services Sales Cost of goods sold Operating expenses Fixed assets Current assets Geog ra p h ic a l seg m ent a separated part of business, in which products are being produced or services are rendered in special economic environment, the business risk and profitability of which is different from other parts of business of the, operating in other geographical economic environment. In 2005, the companies were operating in Lithuania, Latvia, Estonia, and exported goods to other countries. The main indicators by countries are given in the tables below: 2005 Lithuania Latvia Estonia Other countries Sales Cost of goods sold Operating expenses Fixed assets Current assets m. Lithuania Latvia Estonia Other countries Sales Cost of goods sold Operating expenses Fixed assets Current assets

14 2. Intangible fixed assets Development Goodwill Acquired rights Computer software Other intangible assets Total intangible assets Acquisition value Balance on 31 December Additions during the period (+ ) Retirements during the period (-) Balance on 31 December Accumulated amortiz ation Balance on 31 December Amortization for the period (+ ) Retirements during the period (-) Balance on 31 December Net book value on 31 December Development Goodwill Acquired rights Computer software Other intangible assets Total intangible assets Acquisition value Balance on 31 December Assets of the companies acquired (+ ) Additions during the period (+ ) Retirements during the period (-) - (49) (3.955) (26) (7) (4.037) Assets of the companies sold (-) - - (47) (491) (13) (551) Internal transfers + /(-) (48) - (48) Revaluation of investments + /(-) Balance on 31 December Accumulated amortiz ation: Balance on 31 December Accumulated amortization of the companies acquired Amortization for the period (+ ) Internal transfers + /(-) Retirements during the period (-) - (21) (3.921) (6) - (3.948) Amortization written-off of the companies sold - - (31) (430) (8) (469) Balance on 31 December Net book value on 31 December

15 Goodwill MG Baltic Trade Holding MG Baltic Investment Holding MG Valda Holding Total Goodwill Acquisition value Balance on 31 December Additions during the period (+) Retirements during the period (-) - (49) - (49) Balance on 31 December Accumulated amortization Balance on 31 December Amortization for the period (+) Retirements during the period (-) - (21) - (21) Balance on 31 December Net book value on 31 December Goodwill of the consists two companies: 1. Positive goodwill from UAB MG Baltic Media (a mother company of UAB Laisvas ir nepriklausomas kanalas). The net book value was LTL thousands on 31 December It is being amortized since January Positive goodwill from UAB Megarenta. In December 2005, the share capital of UAB Megarenta was increased, and UAB MG Valda has acquired 50% of the increase. As a result of the transaction, a positive goodwill worth 250 LTL thousands has been accounted. It will start being amortized since January 's company UAB TV1 has acquired 100% shares in UAB LNK studija in December As a result of the transaction, a positive goodwill worth 49 LTL thousands has been accounted. The management of the has evaluated the value of the goodwill and decided to write off the net book value as on 31 December The writing off of the net book value is recognized in operational expenses. 5 year term is set for amortization of goodwill, using the straight-line method in both and financial accounts. 38

16 3. Tangible fixed assets Land Buildings Machinery and equipment Vehicles Office equipment, furniture, tools Computer and communication equipment Other equipment and machinery Construction in progress and prepayments Total tangible assets Acquisition value Balance on 31 December Additions during the period (+) Retirements during the period (-) (40) (40) Internal transfers +/(-) Revaluation of investments +/(-) Balance on 31 December Accumulated depreciation Balance on 31 December Depreciation for the period (+) Internal transfers +/(-) Retirements during the period (-) (26) (26) Balance on 31 December Net book value on 31 December

17 Land Buildings Machinery and equipment Vehicles Office equipment, furniture, tools Computer and communication equipment Other equipment and machinery Construction in progress and prepayments Total tangible assets Acquisition value Balance on 31 December Assets of the companies acquired (+) Additions during the period (+) Retirements during the period (-) (22) (36.151) (22.631) (1.268) (2.032) (2.001) (5.243) (3.965) (73.313) Assets of the companies sold (-) (59) (34.672) (1.381) (881) (1.693) (826) (2.228) (4.624) (46.364) Internal transfers +/(-) (64) (8) (87.587) (4.555) Revaluation of investments +/(-) Balance on 31 December Accumulated depreciation: Balance on 31 December Accumulated depreciation of the companies acquired Depreciation for the period (+) Internal transfers +/(-) - (2) (283) (18) (1) (9) (30) - (343) Retirements during the period (-) - (22.067) (9.058) (822) (1.895) (1.903) (2.374) - (38.119) Depreciation written-off of the companies sold - (5.442) (664) (586) (885) (675) (1.552) (22) (9.826) Balance on 31 December Net book value on 31 December Buildings The net book value of 's buildings at 31 December 2005 was LTL thousands ( LTL thousands at 31 December 2004). The most investments to buildings were made by MG Valda group companies. UAB MG Valda and UAB Megarenta has implemented construction projects and transferred from construction in progress buildings worth LTL thousands UAB MG Valda, and LTL thousands UAB Megarenta. UAB Troja has transferred buildings worth LTL thousands and made additional investments worth LTL thousands. In total structure of the, MG Valda group companies control 73,8% of 's buildings in their net book value, MG Baltic Investment group companies 19,6 %, and MG Baltic Trade group companies 6,6%. Value of the buildings that belonged to companies, which have been sold during the year 2005, has been LTL thousand as on the date of the transaction. C onstruction in progress Construction in progress has been reported worth of in 's financial statements for 31 December 2005 ( LTL thousands on 31 December 2004). The construction in progress declined as UAB MG Valda and UAB Megarenta investment projects were finalized. 40

18 4. Financial assets Investments to subsidiaries and associated companies Other investments On 31 December 2005, UAB Koncernas MG Baltic possessed 50% shares of UAB MG Baltic Trade, 66,67% of UAB MG Valda shares and 97,66% of UAB MG Baltic Investment shares. In 's financial accounts, investment into subsidiaries were recognized using cost method, at values: LTL thousands for UAB MG Baltic Trade, LTL thousands for UAB MG Valda, LTL thousands for UAB MG Baltic Investment. During the year 2005, in the, MG Valda group has acquired UAB Dommo Nerija in Lithuania and SIA Industrial and logistics centre Lapegles in Latvia. UAB MG Baltic Investment has increased its stake in AB Lë vuo. In December 2005, AB Stumbras was reorganized by spinning-off bioethanol plant in Ð ilute (Lithuania) to a new company AB Biofuture. During the year 2005, the following companies have been sold: UAB Mineraliniai vandenys ir alus, UAB Mevasta, AB agrofirma Së klos, UAB Neringos vieð butis, and AB ELTA. 's investments to subsidiaries and associated companies at 31 December 2005 have consisted of investments to associated companies AB Lë vuo, UAB Dommo Nerija, and SIA Industrial and logistics centre Lapegles. On 31 December 2005 UAB MG Baltic Investment owned 47,89 % of AB Lë vuo shares. The investment was recognized using equity method at the value of LTL thousands. O 31 December 2004 the investment to AB Lë vuo shares has been accounted for as Other investments, since UAB MG Baltic Investment owned less that 20% of the shares of AB Lë vuo at that date. On 31 December 2005 UAB MG Valda owned 50 % of UAB Dommo Nerija shares and 50% of SIA Industrial and logistics centre Lapegles shares. The investment was recognized using equity method at the value of 4 LTL thousands for UAB Dommo Nerija and LTL thousands for SIA Industrial and logistics centre Lapegles. For 31 December 2005, all amounts fromother investments were transferred to Other financial investments in Other current assets article. 41

19 5. Receivables from subsidiaries and associated companies On 31 December 2005 the had LTL thousand in receivables from subsidiaries and associated companies, a loan from UAB MG Valda to SIA Industrial and logistics centre Lapegles. 6. Amounts receivable after one year Biggest amounts in the 's amounts receivable after one year on 31 December 2005 were the loan from UAB MG Valda to SIA Ammo (2.330 LTL thousand) and AB Stumbras amount receivable from UAB Hestika (1.455 LTL thousand) for the building sold in May Inventories, prepayments, and unfinished agreements Goods purchased for resale Packages and packaging materials Materials and parts Finished production Long term assets for resale Other inventory Other prepayments, and unfinished agreements 's inventories on 31 December 2005 amounted to LTL thousands ( LTL thousands on 31 December 2004), prepayments, and unfinished agreements amounted to LTL thousands (8.013 LTL thousands on 31 December 2004). On 31 December 2005 AB Stumbras has transferred fixed tangible and intangible assets to fixed assets for resale worth of LTL thousands. Inventories, prepayments, and unfinished agreements that belonged to 's companies, which have been sold during 2005, had net book value of LTL thousands. Other changes in the inventories of the were within normal limits. The biggest amounts in the 's inventories come from Apranga group (41,5%), AB Stumbras (26,5%), and UAB Mineraliniai vandenys (19,9%). 42

20 8. Amounts receivable within one year Trade receivables Receivables from the state Loans granted Other receivables The major part in this article is formed by 's trade receivables ( LTL thousands) and loans granted ( LTL thousands). The biggest amounts in the 's amounts receivable come from UAB Mineraliniai vandenys (45,3%), AB Stumbras (23,2%), and UAB Laisvas ir nepriklausomas kanalas (11,0%). In loans granted, the biggest amount is AB Stumbras and AB Biofuture loan to UAB Minvista ( and LTL thousands, respectively). 9. Other current assets Other financial investments Bonds Other commercial papers Deposits Other current assets On 31 December 2005, 's Other financial investments consist of investments in shares of other companies, which are for resale. The value of Other financial investments was LTL thousands. UAB Laisvas ir nepriklausomas kanalas on 31 December 2005 kept LTL thousands worth of deposit in AB bankas Hansabankas. Deposit terms were from 30 December 2005 until 31 January

21 10. Revaluation reserve On 31 December 2005, there was no revaluation reserve in the, since AB ELTA and UAB Neringos vieðbutis were sold, and they were the main sources of revaluation reserve. AB Stumbras transferred its revaluation reserve to retained earnings. 11. Long term liabilities and accounts payable after one year Financial debts to credit institutions Leasing and similar obligations Other financial debts Other long term liabilities and accounts payable after one year Provisions 's long term Financial debts to credit institutions on 31 December 2005 was LTL thousands ( LTL thousands on 31 December 2004). Financial debts to credit institutions by returning terms: From 1 to 2 years From 2 to 5 years After 5 years 's Other financial debts include LTL thousands loan from UAB Minvista. During the year 2005, UAB Koncernas MG Baltic returned LTL thousands worth of financial debts. 's Other financial debts include loans given to 's companies by UAB Minvista ( LTL thousands on 31 December 2005). At the date of reporting UAB Koncernas MG Baltic did not have any voting shares in UAB Minvista. 44

22 12. Short term liabilities and accounts payable within one year Current year portion of the long term liabilities for credit institutions: S hort term deb ts for credit institutions L easing and similar ob ligations O ther short term financial deb ts Short term financial debts for credit institutions: S hort term deb ts for credit institutions L easing and similar ob ligations O ther short term financial deb ts Trade debt Prepayments received Labor-related obligations Taxes payable Other accounts payable and short term liabilities 's Current year portion of the long term liabilities for credit institutions on 31 December 2005 was LTL thousands ( LTL thousands on 31 December 2004). 's Short term financial debts for credit institutions on 31 December 2005 were LTL thousands ( LTL thousands on 31 December 2004). The most part of it consists of credit lines from banks. On 31 December 2005 the balance of credit lines was LTL thousands ( LTL thousands on 31 December 2004). In Other short term financial debts, the major amounts are loans given to 's companies by UAB Minvista ( LTL thousands on 31 December 2005). 's taxes payable on 31 December 2005 amounted to LTL thousands ( LTL thousands on 31 December 2004). VAT payable was LTL thousands (including LTL thousands for UAB Mineraliniai vandenys, LTL thousands for AB Stumbras, LTL thousands for Apranga group), LTL thousands excise tax (including LTL thousands for UAB Mineraliniai vandenys, and LTL thousands for AB Stumbras), and other taxes amounting to LTL thousands. 13. Net sales Income for goods sold Income for services rendered

23 14. Operating expenses Sales expenses Marketing, market research and advertising Logistics Commission Packages and packaging materials, stickers, labels Other sales expenses General and administrative expenses Rent Repair and exploitation Insurance Depreciation and amortization Salaries and social security payments Fuel Communications Taxes Utility charges Security Business trips IT services Consulting Other expenses Other activities Income - - Compensated non-core activities income Profit from sales of fixed assets Rent income Other income from other and incidental activities Expenses - - Compensated non-core activities expenses (4.766) (3.748) - - Loss from sales of fixed assets (854) (1.521) - (2) Other expenses for other and incidental activities (2.574) (3.819) - (2) (8.194) (9.088)

24 16. Financial activities Income - - Interest income from loans granted Dividend income Interest income from bank for deposits Positive influence from exchange rates Profit from sales of investments Other income from financial activities Expenses (202) (206) Interest income from loans received (13.593) (13.839) - - Negative influence from exchange rates (1.674) (3.058) - - Loss from sales of investments (8.195) (12.879) (1) - Other expenses for financial activities (782) (2.050) (203) (206) (24.244) (31.826) 792 (206) (15.599) (296) 17. Significant events after the financial report preparation On 23 March 2006 the acquired 100% of shares in Kaunas construction company UAB Mitnija (company code , address: Palemono g. 3, Kaunas, Lithuania). The acquisition was implemented for investment purposes LTL thousands bank loan was received to finance the acquisition. 47