Tiimari result as expected due to seasonality

KEY FIGURES OF THE CONTINUED OPERATIONS ON REVIEW PERIOD JANUARY 1 - JUNE 30, 2007:

- Turnover MEUR 28.5 (MEUR 1.2) 
- EBITDA MEUR -0.3 (MEUR 0.3) 
- Result of the review period MEUR -2.7 (MEUR 0.3)
- Earnings per share MEUR -0.28 (MEUR 0.05)

STATEMENT OF THE MANAGING DIRECTOR

The business operations of Tiimari Plc on the second quarter of 2007 were significantly marked by the company’s concentration on developing its retail operations. The first new type of pilot outlet was opened in Vuosaari. The reformation project for the logos as well as the visual look of Tiimari Retail and Tiimari outlets started off in June.

In order to improve retail operations management, Tiimari Retail produced a handbook for retail activities. Simultaneously, personnel training was made more efficient by creating a web-based training and introductory programme, called “Elämysopisto”.

Furthermore, Tiimari signed a lease for the largest ever Tiimari store. The chain’s 1,542 square meter flagship store opens in Tammisto, in Vantaa in November 2007. It is approximately three times the size of the currently operating Tiimari outlets. The store will concentrate on selling interior decoration products. Moreover, Tiimari opened two other outlet stores in Helsinki and one in Tampere in the current review period. A so called web-shop concept is being developed for both Tiimari Retail and Leo Longlife Design. During the review period, Leo Longlife business operations developed favourably and the increase in turnover as compared to the previous year was significant.

International expansion activities continued, as a new store was opened in Gliwice, Poland. The 240 square metre store is Tiimari’s third one in Poland. It is located in the new Gliwice Forum trade centre, which is expected to become the most attractive shopping mall in the area.

A company was set up in Moscow to prepare market penetration in Russia.

At the end of the review period, Tiimari had a total of 177 retail stores, the number of the equivalent period in 2006 being 182 stores. 156 stores are located in Finland (156), 14 in Estonia (17), 4 in Latvia (4), 1 in Norway (2), 0 in Sweden (1) and 2 in Poland (2). Additionally, Tiimari’s partner sellers in Finland had altogether 6 (6) stores and 0 (2) franchise stores. At the end of the review period, Tiimari had a total of 10 (9) franchise stores in Sweden. A central part of Tiimari's strategy is to increase the number of stores and to optimise their location and size in square metres.

FINANCIAL RESULT

The turnover of the Tiimari concern in the review period was MEUR 28.5 (MEUR 1.2). In the period of comparison January 1 - June 30, 2006 the Company engaged exclusively in the sale of business gifts and related industrial operations.

Turnover reached MEUR 13.9 (MEUR 0.5) in the second quarter. Earnings before interest, taxes, depreciation and amortization (EBITDA) reached a total of MEUR -0.3 (MEUR 0.3) in the review period.

Earnings before interest, taxes, depreciation and amortization (EBITDA) reached a total of MEUR -0.5 (MEUR -0.09) in the second quarter.

EBITDA of the first half-year includes MEUR 0.9 of inventory write-offs that are related to the acquisition of Maritii Oy. After tax, the earnings of the review period were MEUR 2.7 (MEUR 0.3).

The result of the financial period was MEUR -1.5 (MEUR -0.04) in the second quarter. Earnings per share from continued operations were EUR -0.15 EUR (-0.01).

DEDUCTIBILITY OF CONSOLIDATED LOSSES

The Company was granted a special exemption in June 2007 by the Uusimaa Regional Tax Office, to deduct the consolidated losses of Tiimari Retail Oyj and Maritii Oy from 2003 to 2005, and the possible losses and the undistributed tax credits from tax years 2003 and 2004, in spite of the change of ownership exceeding 50 percent, which took place in the fiscal year 2006. Due to the special exemptions, the Company has re-allocated Maritii’s write-offs by posting MEUR 2.47 from consolidated losses and undistributed tax credits, reducing the business value occurring from imputed tax assets.

BALANCE, FINANCIAL SITUATION AND INVESTMENTS

On June 30, 2007 the total balance of Tiimari Plc was MEUR 82.7 (MEUR 21.2). The Company has a solid financial situation. Interest-bearing net liabilities were MEUR 36.8 (MEUR -12.1), the solvency ratio was 38.3 % (87.6 %) and the net gearing 116.2 % (-65.2 %). Seasonal fluctuations have a considerable impact on the Company’s financial situation.

During the review period, the Company paid a total of MEUR 1.4. in dividends and settled the agreed additional purchase price of MEUR 1.5 for the acquisition of Maritii Oy on 9 October 2006.

During the review period, the central investments were made in the retail store network, totalling at MEUR 0.5.

PERSONNEL

The number of people employed by the group on June 30 2007 was 496 (45) and on average 592 (45), of whom the most worked for Tiimari Retail Oyj. The parent Company employed 1 (5) person, and Leo Longlife Design Oy employed 37 (49), and on average 37 (49) persons.

GROUP STRUCTURE

The Tiimari Plc group consists of parent Company Tiimari Plc and directly
or indirectly entirely owned Maritii Oy (Helsinki), Tiimari Retail Oyj  
(Lahti), Tiimari Sweden AB (Stockholm), Tiimari Baltic AS (Tallinn), Tiimari   
Latvia SIA (Riga), Tiimari Polska SP Z.O.O (Warsaw), Tiimari Moscow Z.A.O. Leo Longlife Design Oy (Kokkola) and Tuotesampo Oy (Tuotesampo Oy has no operations). The group includes also Tiimari Norway AS (Oslo), of which the group's share of ownership is 67,8 % and the joint-stock property company Osuuskunnantie 30, which is a 10 % subsidiary of Tiimari Plc and a 90 % subsidiary of Leo Longlife Design Oy. This joint-stock property company has sold its real estate holdings and all on-site buildings.
SHARE CAPITAL

At the end of the review period, the registered share capital of Tiimari Plc
totalled at EUR 7.686.200, representing an aggregate number of 9.847.750 voting rights. The Company had a total of 2768 shareholders at the end of the review period. At the end of the review period, the number of own shares held by the Company was 11,850. The number of shares corresponds to that held at the beginning of the period. The nominal value of shares held by the Company was MEUR 0.01 and the proportion of share capital and voting rights was 0.12 %.

ANNUAL GENERAL MEETING 2007

Held on April 17, 2007, the Annual General Meeting of Tiimari Plc decided to pay a dividend of EUR 0.15 per share totalling at MEUR 1.4. Re-elected members of the Board were Alexander Ehrnrooth, Arja Hautanen, Kirsti Lindberg-Repo, Curt Lindbom, Mia Saari and Peter Seligson, with Erik Helin appointed as a new member.

Under a decision by the Annual General Meeting, the Board of Directors was authorised to decide on assigning an aggregate maximum of 2,000,000 new shares in the form of a share issue or special rights (including stock options) entitling to shares pursuant to Chapter 10, Section 1 of the Finnish Companies Act in one or more tranches. The Board of Directors may issue either new shares or the Company’s own shares that may be in the Company's possession. The proposed maximum represents approximately 20.3 % of all the Company shares as on the date that the invitation to the Annual General Meeting was published. The authorisation is proposed to be used for financing and implementing potential corporate acquisitions or other arrangements, for consolidating the Company's balance and financial situation and for any other corporate purposes determined by the Board of Directors. The authorisation covers the right of the Board of Directors to decide on any and all terms and conditions of share issues and the issuing of special rights pursuant to Chapter 10, Sections 1 of the Finnish Companies Act, including the right to identify the beneficiaries of shares or of special rights entitling to shares and to determine the amount of consideration.

DEVELOPMENTS AFTER THE REVIEW PERIOD

Master of Political Science, Veli-Pekka Kahanpää was appointed as the Financial Director and a member of the Management Group of Tiimari. He takes his post at Tiimari in September 2007, leaving his previous post as the Finance Manager and the Chief Risk Officer at Uponor Oyj.

As a result of the employer-employee negotiations at Leo Longlife Oy, a member company of the group, three persons were dismissed.

Leo LOnglife Design web shop was opened in August 2007. Upon the launch, the Leo Longlife product selection was renewed and expanded considerably.

Tiimari continued its expansion in Poland by signing a tenancy agreement for a fourth retail outlet. The store will be opened in the beginning of November in Bialystok, North-East Poland. The store will be located in a new trade centre, Galleria Podlaska, which is being constructed around Carrefour.

VISIONS FOR THE FUTURE

The anticipated turnover for the entire year 2007 is approximately MEUR 77.00 the forecasted earnings before interest, taxes, depreciation and amortization (EBITDA) being approximately MEUR 8.00 and including yet for this year the depreciation of MEUR 1.4 from the acquisition of Maritii Oy. The result for the financial period is expected to be noticeably positive. As last year, the majority of the earnings are entered as income during the last quarter.

RISK AND THREAT ANALYSIS FOR THE NEAR FUTURE

The biggest challenges that Tiimari is faced with are the fluctuations in the general consumption, demand and the competition environment, as well as
the attainability of advantageous business locations in the international market. Tiimari is currently concentrating heavily on developing its stores and marketing activities. The Company is seeking growth in the number of visitors and the amount of purchases per visitor, as well as developing its international operations. Managing the potential growth requires investments in administration, new locations, internationalization and recruiting more staff. Tiimari strives to prepare for changes in consumer demand and the competition environment by knowing the consumer, constantly developing the Company concept, and by implementing new and innovative business solutions.

CONSOLIDATED PROFIT AND LOSS ACCOUNT
                                                        
EUR 1000                                2007      2006    2007    2006      2006
                                         4-6       4-6      1-6     1-6     1–12
Continued operations                                                           
TURNOVER                               13,854      520   28,474   1,224   32,819
Other operating income                    -18        0      162       0      346
Change in inventories                    -380      -35     -861     131   -8,992
Materials and supplies                 -5,015      -94  -10,011    -143   -7,667
Work benefit and reward expenses       -3,646     -320   -7,595    -549   -4,717
Depreciation                             -517      -34   -1,111     -69     -871
Other operating costs                  -5,239     -156  -10,454    -319   -4,900
Operating profit / loss                  -961     -119   -1,396     275    6,018
Financial income and expenses            -668       98   -1,340     109     -793
Profit / loss before taxes             -1,629     - 21   -2,736     384    5 225
Taxes                                     120     - 21        0    -112     -396
Profit/loss for the review period
from continued operations              -1,509      -42   -2,736     272    4,829
Discontinued operations                                                        
Profit                                                              
from discontinued operations                0      310        0   1,281    1,460
Profit/loss for the financial year     -1,509      268   -2,736   1,553    6,289
Parent company shareholders'                                                   
profit earnings                                                                
per share                                                                      
Undiluted earnings per share                                                   
Continued operations                    -0.15    -0.01    -0.28    0.05     0.70

Discontinued operations                           0.05             0.19     0.21
The adjusted value with the dilution effect
the earnings per share correspond to those of the
undiluted earnings per share

CONSOLIDATED BALANCE SHEETS                                                 
                                                                               
                                         
                                      30.06.07         30.06.06         31.12.06
ASSETS                                                                         
Business value                          32,987                0           35,392
Other intangible assets                 14,999               29           15,387
Tangible assets                          3,428            1,092            9,890
Investment properties                        0              639                0
Other financing resources                  114               11              114
Receivables                                 84               30              134
Imputed tax credit                       1,450                0                0
Total long-term assets                  53,062            1,801           60,917
Current assets                          24,479            6,942           25,206
Trade and other receivables              3,929              299            3,852
Liquid assets                            1,250           12,142            8,323
Total current assets                    29,658           19,383           37,381
Non-current assets                                                             
held for sale                                0                0              830

TOTAL ASSETS                            82,720            21,184          99,128

OWN SHARE CAPITAL AND LIABILITIES
Parent Company’s shareholders'
equity                                                             
TOTAL SHAREHOLDERS’ EQUITY              31,723            18,566          35,891
LIABILITIES                                                                    
Imputed tax credit                       5,524                 0           6,552
Interest-bearing liabilities            18,102                30          20,835
Provisions                                  27                 0              45
Total non-current liabilities           23,653                30          27,432

Interest-bearing liabilities            20,004                 0          21,080
Provisions                                  22                 0               0
Accounts payable and other payables      7,318             2,218          14,040
Current tax                                  0               370             165
Total current liabilities               27,344             2,588          35,285
Liabilities related to non-current
assets held for sale                         0                 0             520
TOTAL LIABILITIES                       50,997             2,618          63,237
                                                                               
TOTAL SHAREHOLDERS’
EQUITY AND LIABILITIES                  82,720            21,184          99,128

CALCULATION OF CHANGES TO THE GROUP’S SHAREHOLDERS’ EQUITY                     
                                                                               
                                                                               
The parent Company's shareholders' equity

Calculation of changes to shareholders' equity 1.1.-30.6.2007

                 Invested
                     free
                      Own              Current
            Share  equity        Own     value     Transl.  Accumulated
Own equity  equity   fund     shares      fund       diff.      profits     Tot.
1.1.2007
Own equity   7,686   11,558      -55       0           -27       16,729   35,891
Transl. difference conversion                           39                    39
Profit/loss for the financial period                             -2,736   -2,736
Distribution of dividend                                         -1,477   -1,477
Equity-settled
share-based payments                                                  6        6
Own equity   7,686   11,558      -55       0           12        12,522   31,723
30.6.2007

Calculation of changes to shareholders' equity 1.1.-30.60.2006

                Invested
                     free
                      Own              Current
            Share  equity        Own     value    Transl.  Accumulated
Own equity  equity   fund     shares      fund       diff.      profits     Tot.
1.1.2006                                                                       
Own equity   6,600     0        -119       -6           0        13,773   20,248
Profit/loss for the financial period                              1,553    1,553
Total recognised profit                                                        
and loss for the
period                                                            1 553    1 553
Issue
of own shares                     64                                          64
Distribution of dividend                                         -3,300   -3,300
Other items                                                           1        1
Own equity   6,600      0        -55       -6           0        12,027   18,566
30.6.2006

CASH FLOW STATEMENT
                                             1-6/07       1-6/06         1–12/06

Consolidated statements of cash flows
Cash flows from operations                                                     
Profit/loss for financial period             -2,736        1,553           6,289
Adjustments:                                                                   
Depreciation and decrease in value            1,110           69             871
Financial income and expenses                 1,339            0             793
Taxes                                             0          319             435
Other adjustments                              -144            0            -361
Change in working capital:                                                     
Change in short-term receivables               -227          -50            -102
Change in inventories                           726       -3,390           9,308
Change in short-term liabilities             -6,706         -461          -1,180
Interests paid                               -1,406            0          -3,548
Interest income received                         70            6             305
Taxes paid                                      -56         -117            -145
Net cash flow from operations                -8,030       -2,071          12,665
                                                                               
Cash flows from investment activities                                          
Investments in tangible and intangible
assets                                         -478            0             -51
Acquisitions of subsidiary companies                                           
net of cash acquired                              0           -5         -22,325

Capital gains from
tangible and intangible assets                6,680            0           1,494
Repayment on other receivables                    0            0               0
Repayment on loan receivables                    50            4               2
Additional purchase price                    -1,500            0               0
Net cash flow from investments                4,752           -1         -20,880

Cash flows from financing activities
Share issue                                       0            0          12,644
Long-term loans, increase                     6,500            0          13,859
Long-term loans, decrease                    -2,819            0         -34,836
Purchase and issue of own shares                  0           64              64
Long-term loans, increase                     2,993            0          32,974
Long-term loans, decrease                    -5,014            0         -20,617
Short-term loans, decrease                   -3,980            0               0
Dividends paid                               -1,475       -1,585          -3,286
Net cash flow from financing                 -3,795       -1,521             802
Change in financial resources                -7,073       -3,593          -7,413
Liquid assets January 1, 2007                 8,323       15,736          15,736
Liquid assets June 30, 2007                   1,250       12,143           8,323

NOTES TO THE ACCOUNTS

This Interim Report was prepared in accordance with IAS 34 standard on Interim Financial Reporting pursuant to the same principles applied in the Financial Statement 2006. The Interim Report figures are unaudited.

All the future estimates and predictions on this announcement are based on the company's current vision of the market and economical developments. Actual events and results may differ considerably.

Due to the fact that Tiimari Plc had yet not engaged in Tiimari Retail operations one year ago, the business operations cannot, as such, be compared to the equivalent quarter of the previous year.

SEGMENT-SPECIFIC FIGURES

The Company’s continued operations form two primary
Business segments: Tiimari Retail Oyj and Leo Longlife Design Oy.

Turnover by segment

EUR 1000                                2007      2006     2007    2006     2006
                                         4-6       4-6      1-6     1-6     1–12
Turnover
Tiimari business operations            13,174        0   27,324       0   27,478
Leo Longlife business operations          680      403    1,150     766    1,622
Other operations                            0      117        0     458    3,719
Total                                  13,854      520   28,474   1,224   32,819

Profit / loss
Tiimari business operations              -945        0   -1,256       0    6,717
Leo Longlife business operations            5     -155      -56       1     -385
Other operations                          -21       36      -84     274     -314
Total                                    -961     -119   -1,396     275    6,018

Assets and liabilities by segment     30.06.07         30.06.06         31.12.06

Assets by segment EUR 1 000
Tiimari business operations             79,425                0           88,716
Leo Longlife business operations         4,141            1,333            3,660
Unaligned assets                         3,861           19,851           11,584
Elimination                             -4,707                0           -4,832
Total                                   82,720           21,184           99,128

Liabilities by segment EUR 1 000
Tiimari business operations              7,062                0           15,101
Leo Longlife business operations           329              177              357
Unaligned liabilities                   48,584            2,440           53,224
Elimination                             -4,978                0           -5,445
Total                                   50,997            2,617           63,237

CONTINGENT LIABILITIES                30.06.07         30.06.06         31.12.06

Financial institution loans against
the following securities                25,013                0           24,617

Real estate mortgages                    2,361                0            8,029
Corporate mortgages                     31,137                0           31,137
Pledged shares                           1,476                0            1,476
Other own liabilities:
Irrevocable letters of credit                0                0              292
Other liabilities                           13               13               13

OTHER TENANCY LIABILITIES

Due within one year                     10,782                0           10,577
Due after one year                       5,376                0            2,619

GROUP INVESTMENTS AND DEPRECIATIONS EUR 1,000

                                          2007             2006             2006
                                           1-6              1-6             1-12

Gross investments                          465                5              150
Depreciations                            7,224            2,000              859

CHANGES TO GROUP'S FINANCIAL INSTITUTION LOANS

                                      30.06.07         30.06.06         31.12.06

Increase                                 9,493                0           46,833
Decrease                                -7,834                0          -55,451
Loan repayments                         -3,980                0                0
Total of changes                        -2,321                0           -8,618

CLOSE CIRCLE EVENTS

Tiimari Plc paid back a loan in the amout of MEUR 2.4 to Virala Oy Ab owned by Member of the Board, Alexander Ehrnrooth on May 24, 2007.

Loans have not been granted to the key management persons.

Management’s employment benefits 2007       2006       2007      2006       2006
                                  4-6        4-6        1-6       1-6       1-12

Salaries and other short-term
employment benefits                55         35        140        45        271
Share-based benefits                6          2          6         2          7

KEY INDICATORS
                                             1-6/07        1-6/06        1–12/06

Turnover                                     28,474         1,224         32,819
Operating profit / loss                      -1,396           275          6,018
Result of the financial period               -2,736           272          4,829
Earnings / share, EUR                         -0.28          0.19           0.91

Earnings / share,
from continued operations EUR                 -0.28          0.05           0.70
SH equity / share, EUR                         3.22          2.81           3.64
SH equity / share (diluted), EUR               3.22          2.81           3.64
Solvency ratio                                38.35 %       87.64 %      36.20 %
Gearing (level of indebtedness)              116.18 %      -65.24 %      95.05 %
Balance sheet total                          82,720        21,184         99,128
Number of shares (average)                9,847,750     6,600,000      6,864,386
Interest-bearing net liabilities             36 856       -12 113         33 593

CALCULATION OF KEY INDICATORS

Earnings/share (EPS), EUR=
(Earnings before extraordinary items – taxes) / Avg. number of shares adjusted for the share issue.

Shareholders' equity/share, EUR=
Shareholders’ equity / Number of shares at the end of the preview period

Solvency ratio-%=
(Shareholders’ equity*100)/(Balance sheet total-advance payments received)

Level of indebtedness (gearing)=
(Interest-bearing liabilities-cash at bank) * 100/SH equity

Interest-bearing net liabilities
Interest-bearing liabilities – cash at bank

SHAREHOLDERS

On June 30, 2007, Tiimari Plc had a total of 2768 shareholders.

Major shareholders, June 30, 2007.

                                                                 % of shares and
                                                       Shares      voting rights

Atine Group Oyj                                     2,081,216               21.1
Assetman Oy                                         1,000,000               10.2
Baltiska Handels A.B.                                 455,224                4.6
Cumasa Oy                                             407,625                4.1
Varma Mutual Pension Insurance Company                375,000                3.8
Ilmarinen Mutual Pension Insurance Company            351,781                3.6
Nordea Pankki Finland Oyj, administrative reg.        336,355                3.4
Pohjola Non-Life Insurance Company                    202,092                2.1
Suomen Kauppayhtiöt Oy                                125,000                1.3
Tapiola Suomi Mutual Fund                             103,602                1.1
Troll Capital Oy                                      100,000                1.0
Moneda Consulting Oy                                   87,500                0.9
Syrjänen Jaakko                                        61,875                0.6
Illi Kristina                                          60,000                0.6
EQ Pankki Oy                                           50,000                0.5
Turpeinen Urho                                         50,000                0.5
Jyväsjärvi Juha                                        35,000                0.4
Lamy Oy                                                32,625                0.3
Mezera Oy                                              31,250                0.3
Mäki Raimo                                             30,500                0.3
Kallio Mika                                            29,687                0.3
Brade Jouko                                            28,750                0.3
Kontinon Yhteiseläkesäätiö Os B/TE                     28,100                0.3
Soininmäki Seppo                                       26,050                0.3
Uusi-Kilponen Pekka                                    25,500                0.3

NOTIFICATIONS UNDER CHAPTER 2, SECTION 9 OF THE FINNISH SECURITIES MARKETS ACT

Virala Oy Ab announced on June 1, 2007 that its share of ownership and rights to vote of Tiimari Plc has gone under 1/20. After the transaction, Virala Oy Ab owned 0 of Tiimari Plc’s shares.

Kristina Illi
Managing Director

Distribution: Helsinki Stock Exchange
Key media
www.tiimari.com

Further information: Managing Director Kristina Illi, tel. +358 (0)400 408 889