Algol Group´s financial year in 2005 one of positive development

The Algol Group recorded a strong growth in sales in 2005, although the
financial result remained at almost exactly the same level as the previous
year. The second year following the restructuring of the Group was still a
period of development in all three business areas, which continued to work
towards increasing competitiveness and strengthening their positions in the
markets.

Net sales for the Algol Group in 2005 amounted to EUR 175,9 million, which
represents growth of approximately 11 per cent over the previous year. Total
sales, which reflects operational volumes in the technical trade, increased by
approximately 22 per cent to EUR 244.6 million. The result was EUR 3.8 million,
which is almost exactly the same as the previous year. The Group continues to
maintain excellent solidity.

Algol Managing Director Magnus Bargum describes the 2005 financial year as
moderately satisfactory, even though the development of results for the Group
did not keep pace with the increase in sales. According to Magnus Bargum, the
background to this situation includes lower market prices due to tough
competition and costs related to the expansion of Group activities. All Group
business areas increased sales, and all the three created positive results.
Finland´s economic growth suffered in the beginning of 2005 from a downturn in
industrial production and the effects of the labour dispute within the paper
industry. The business outlook improved throughout the autumn, and at the end
of the year the volume of orders and production expectations within Finnish
industry were generally at a high level. Investments in production were also
growing.

The Group´s largest business area continues to be Algol Chemicals, which
increased its sales also in part by broadening its range of products. The
company strengthened its home market area in the eastern parts of Europe by
expanding into Ukraine.

Algol Technics began redirecting its organisation from a product-based
operating model to one that is branch-based and service-oriented. The
favourable development of the company´s results was strengthened in particular
by increased investments within the technology industry and a healthy
construction sector, and at the end of the year its own order book reached
record high levels for this millennium.

Algol Pharma´s sales growth far exceeded the average of the branch. The
financial year was highlighted by expanding operations and recruiting personnel
in markets close to Finland. In Finland itself the company prepared for
investments in expanding its warehousing facilities and increasing the
efficiency of their operations.

Outlook for 2006
is favourable

The healthy economy in Finland and EU markets is creating strong demand for raw
materials and a high level of industrial investments, suggesting favourable
development for Algol Chemicals and Algol Technics also this year. The outlook
for Algol Pharma is also positive, despite the negative price development of
some products in the markets. Magnus Bargum confirms that the Group will
continue development work in all its business areas in 2006. The new result
budget has been created around the possibility of further investments in order
to maintain the current level of financial results.

According to Magnus Bargum, the Algol Group will continue to develop in the
direction of comprehensive service packages and further specialisation within
each business area. This goal is supported by developments in the business
environment: globalisation, rapid changes and new production structures.
"Previously, service was a fixed part of a product. The growing trend now is
for products to form part of a service package", Bargum says.[

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