THE STOCKMANN GROUP’S NEW LONG-TERM FINANCIAL TARGETS

STOCKMANN plc STOCK EXCHANGE RELEASE June 14, 2006, at 16.30

THE STOCKMANN GROUP’S NEW LONG-TERM FINANCIAL TARGETS

Following the change in Stockmann’s Group structure, at its strategy
meeting held today, June 14, 2006, Stockmann’s Board of Directors
confirmed the Group’s new financial targets up to 2011. The objective is
for the Group’s return on capital employed to reach 22 per cent in 2011,
with an operating profit margin of 10 per cent. The other financial
targets – an equity ratio of at least 50 per cent and sales growth that
outpaces the market average – are unchanged. The dividend policy likewise
will remain unchanged, the objective being to pay dividends of over 50 per
cent of the profit on ordinary operations, nevertheless taking into
account the financing required to grow the business. The Board of
Directors estimates that in 2011, International Operations will account
for about half of the Group’s sales and earnings.

Because the Board of Directors considered that the Stockmann Group would
last year reach the financial targets set by the Board in 2001, it set new
targets that will be in place up to 2010. These are a return on capital
employed of at least 20 per cent, an operating profit margin of at least 8
per cent, sales growth that outpaces the market average and an equity
ratio of at least 50 per cent. In 2005, the return on capital employed
reached 19.6 per cent and the operating profit margin was 6.7 per cent.
The sales trend and equity ratio were in line with the targets set.

STOCKMANN plc

Hannu Penttilä
CEO

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