Kesko Oyj : Kesko's financial statements release for the period 1 Jan. 2012 to 31 Dec. 2012

Kesko Oyj : Kesko's financial statements release for the period 1 Jan. 2012 to
                                 31 Dec. 2012

KESKO CORPORATION STOCK EXCHANGE RELEASE 05.02.2013 AT 09.00 1(32)

Financial performance in brief:
*The Group's net sales for January-December increased by 2.4%.
* The retail and B2B sales (excl. VAT) of the K-Group (i.e. Kesko and chain
stores) for January-December increased by 2.9%
*The operating profit excluding non-recurring items was €234.7 million (€278.9
million).
*The Board proposes a dividend of €1.20 per share.
*The future outlook has been changed. The Kesko Group's net sales for 2013 are
expected to match the level of the previous year. As a result of measures
taken to enhance business operations and cost savings, the operating profit
excluding non-recurring items for 2013 is expected to exceed the operating
profit excluding non-recurring items for 2012, unless the overall consumer
demand significantly weakens. The capital expenditure for 2013 is expected to
be lower compared to the capital expenditure for the previous year.

Key performance indicators

                                    1-12/2012  1-12/2011 10-12/2012 10-12/2011
Net sales, € million                    9,686      9,460      2,459      2,481
Operating profit excl. non-
recurring items, € million              234.7      278.9       71.8       71.5
Operating profit, € million             216.7      280.6       52.7       72.8
Profit before tax, € million            215.2      282.1       53.0       74.0
Capital expenditure, € million          378.3      425.4      103.8      104.5
Earnings per share, diluted, €           1.30       1.84       0.24       0.51
Earnings per share excl.
non-recurring items, basic, €            1.50       1.84       0.45       0.50
                                   31.12.2012 31.12.2011
Equity ratio, %                          52.5       53.9
Equity per share, €                     22.43      22.20

FINANCIAL PERFORMANCE

Net sales and profit for January-December 2012
The Group's net sales in January-December 2012 were €9,686 million, which is
2.4% up on the corresponding period of the previous year (€9,460 million). In
Finland, net sales increased by 1.0% and in other countries by 9.0%.
International operations accounted for 18.2% (17.1%) of the net sales. Net
sales grew in the food trade, the home and speciality goods trade and the
building and home improvement trade.

1-12/2012                    Net sales, € Change, % Operating profit Change, €
                                  million                 excl. non-   million
                                                           recurring
                                                    items, € million
Food trade                          4,311      +3.1            168.4      -3.8
Home and speciality goods
trade                               1,603      +2.5             19.8     -16.8
Building and home
improvement trade                   2,827      +4.1             13.6     -13.0
Car and machinery trade             1,114      -5.1             42.1      -9.7
Common operations and
eliminations                         -169      -3.9             -9.3      -0.9
Total                               9,686      +2.4            234.7     -44.2

The operating profit excluding non-recurring items for January-December was
€234.7 million (€278.9 million), representing 2.4% (2.9%) of net sales. The
profit performance was affected by several new store openings, higher level of
costs and the expansion of Russian business operations. In addition,
profitability was negatively impacted by a total write-off of €6 million
related to personnel reductions. The operating profit excluding non-recurring
items includes a €12 million amount recognised as revenue in connection with
the transfer of the pension insurance portfolio.

Operating profit was €216.7 million (€280.6 million). The operating profit
includes a €-18.0 million (€1.7 million) net amount of non-recurring items.
The non-recurring items include an impairment charge of €-23.4 million on
Anttila's goodwill and a €21.3 million reversal of the impairment of Indoor's
brands. In addition, non-recurring expenses in a total of €-16.8 million were
recognised for restructuring Musta Pörssi's business operations. The Group's
profit before tax for January-December was €215.2 million (€282.1 million).

The Group's earnings per share were €1.30 (€1.84). The Group's equity per
share was €22.43 (€22.20).

In January-December, the K-Group's (i.e. Kesko's and the chain stores') retail
and B2B sales (VAT 0%) were €12,107 million, up 2.9% compared to the previous
year. In January-December, the K-Group chains' sales entitling to K-Plussa
points were €5,876 million excluding tax, up 3.2% compared to the previous
year. The K-Plussa customer loyalty programme gained 93,285 new households in
January-December. At the end of December, there was 2,219,516 K-Plussa
households and over 3.8 million K-Plussa cardholders.

Net sales and profit for October-December 2012
The Group's net sales in October-December were €2,459 million, which is 0.9%
down on the corresponding period of the previous year (€2,481 million). Net
sales decreased by 2.6% in Finland and increased by 8.4% in the other
countries. International operations accounted for 17.1% (15.6%) of the net
sales. In the fourth quarter, net sales growth rate fell due to a decrease in
the car trade net sales after the car tax change, a decrease in the net sales
of the home and speciality goods trade, and a fall in the growth rate of the
building and home improvement trade and the food trade.

10-12/2012                   Net sales, € Change, % Operating profit Change, €
                                  million                 excl. non-   million
                                                           recurring
                                                    items, € million
Food trade                          1,132      +2.2             45.0       6.4
Home and speciality goods
trade                                 487      -2.8             32.4      -0.6
Building and home
improvement trade                     657      +0.1            -10.8      -6.3
Car and machinery trade               227     -13.7              4.7      -2.2
Common operations and
eliminations                          -45      -6.8              0.5       3.1
Total                               2,459      -0.9             71.8       0.3

The operating profit excluding non-recurring items for October-December was
€71.8 million (€71.5 million), representing 2.9% of net sales (2.9%). The
operating profit excluding non-recurring items was negatively impacted by a
fall in the growth rate of sales, the expansion of the store site network and
Russian business operations, in addition to the €6 million write-off related
to personnel reductions. The operating profit excluding non-recurring items
includes a €15 million amount recognised as revenue in connection with the
transfer of the pension insurance portfolio.

Operating profit was €52.7 million (€72.8 million). The operating profit
includes a €-19.1 million net amount of non-recurring items. The operating
profit of the comparative period included €1.3 million of non-recurring items.
The Group's profit before tax for October-December was €53.0 million (€74.0
million).

The Group's earnings per share were €0.24 (€0.51).

In October-December, the K-Group's (i.e. Kesko's and the chain stores') retail
and B2B sales (VAT 0%) were €3,100 million, up 0.3% compared to the previous
year. In October-December, the K-Group chains' sales entitling to K-Plussa
points were €1,553 million excluding tax, up 0.8% compared to the previous
year.

Finance
In January-December, the cash flow from operating activities was an excellent
€381.7 million (€215.7 million). The cash flow from investing activities was
€-390.7 million
(€-441.1 million). It included a €24.5 million (€8.2 million) amount of
proceeds from the sale of fixed assets.

The Group's liquidity remained at a strong level. In September, a €250 million
bond was issued to finance the Group's capital expenditure and to extend the
debt financing structure. At the end of the period, liquid assets totalled
€489 million (€367 million). Interest-bearing liabilities were €624 million
(€400 million) and interest-bearing net debt €135 million (€33 million) at the
end of December. Equity ratio was 52.5% (53.9%) at the end of the period.

In January-December, the Group's net finance costs were €0.6 million (net
finance income €0.8 million).

In October-December, the cash flow from operating activities was €174.0
million (€46.6 million). The cash flow from investing activities was €-115.7
million (€-110.1 million). It included a €1.9 million (€2.0 million) amount of
proceeds from the sale of fixed assets.

In October-December, the Group's net finance income was €1.1 million (net
finance income €0.8 million), which included a €3.8 million amount of interest
in cooperative capital from Suomen Luotto-osuuskunta.

Taxes
The Group's taxes for January-December were €75.8 million (€85.2 million). The
effective tax rate was 35.2% (30.2%), affected by loss-making foreign
operations.

The Group's taxes for October-December were €27.1 million (€18.7 million). The
effective tax rate was 51.2% (25.3%).

Capital expenditure
In January-December, the Group's capital expenditure totalled €378.3 million
(€425.4 million), or 3.9% (4.5%) of net sales. Capital expenditure in store
sites was €310.0 million (€361.4 million), in IT €21.7 million (€20.4 million)
and other capital expenditure was €46.6 million (€21.8 million). Capital
expenditure in foreign operations represented 22.9% (31.7%) of total capital
expenditure.

In October-December, the Group's capital expenditure totalled €103.8 million
(€104.5 million), or 4.2% (4.2%) of net sales. Capital expenditure in store
sites was €71.2 million (€88.6 million) and other capital expenditure was
€32.6 million (€15.2 million). Capital expenditure in foreign operations
represented 31.7% (18.5%) of total capital expenditure.

Kesko's strategic focus areas and profitability programme
The key focus areas in Kesko's business operations are to strengthen sales
growth and the return on capital in all divisions, to exploit business
opportunities in e-commerce and in Russia, and to maintain good solvency and
dividend payment capacity.

As a result of weakened general economic situation, tightened competition and
an increase in the level of costs, Kesko is implementing the profitability
programme announced previously, which aims to ensure price competitiveness and
to improve profitability. The profitability programme includes significant
measures aimed to increase sales, to enhance purchasing operations and to
adjust costs, working capital and capital expenditures.

The Group level cost saving target is a total of around €100 million. Cost
savings will be implemented in all divisions and in all operating countries.
Most of the cost savings are expected to be achieved in 2013. The measures for
staff cost enhancement have been implemented as announced previously, and the
reduction of labour in the whole Group is 885 person-years, of which 486 in
Finland. In addition to terminations, the reductions include reduced working
hours and retirement arrangements. Other significant savings will be
implemented by adjusting especially marketing and store site expenses and by
centralising ICT purchases. In addition, special enhancement measures will be
targeted at operations with poor profitability. The number of personnel in
Rautakesko's foreign operations will be adjusted by some 400 person-years,
Anttila's chain concepts will be reformed and costs will be adjusted, an
e-commerce based operating model will be implemented for Musta Pörssi and its
store site network will be strongly adjusted. The chain concept of
Intersport's business operations in Russia will be reformed and unprofitable
store sites will be closed.

In the next few years, capital expenditure will be aligned with funds
generated from operations to some €200-300 million per year.

Personnel
In January-December, the average number of employees in the Kesko Group was
19,741 (18,960) converted into full-time employees. In Finland, the average
increase was 170 people, while outside Finland, it was 611.

At the end of December 2012, the total number of employees was 24,031
(23,375), of whom 13,229 (13,124) worked in Finland and 10,802 (10,251)
outside Finland. Compared to the end of December 2011, there was an increase
of 105 people in Finland and 551 people outside Finland.

In January-December, the Group's staff cost was €602.9 million, an increase of
5.7% compared to the previous year. The staff cost for October-December
decreased by 0.8% compared to the previous year and was €155.0 million. The
staff cost for the last quarter was reduced by a €15 million amount recognised
as revenue in connection with the transfer of the pension insurance portfolio.

SEGMENT INFORMATION

Seasonal nature of operations
The Group's operating activities are affected by seasonal fluctuations. The
net sales and operating profits of the reportable segments are not earned
evenly throughout the year. Instead, they vary by quarter depending on the
characteristics of each segment.

Food trade

                                     1-12/2012 1-12/2011 10-12/2012 10-12/2011
Net sales, € million                     4,311     4,182      1,132      1,108
Operating profit excl. non-
recurring items, € million               168.4     172.2       45.0       38.6
Operating profit as % of net sales
excl. non-recurring items                  3.9       4.1        4.0        3.5
Capital expenditure,
€ million                                200.0     221.5       43.3       62.3
Net sales, € million                 1-12/2012 Change, % 10-12/2012  Change, %
Sales to K-food stores                   3,327      +2.4        877       +0.6
Kespro                                     787      +6.3        203       +7.9
Others                                     197      +3.3         53       +7.9
Total                                    4,311      +3.1      1,132       +2.2

January-December 2012
In the food trade, the net sales for January-December were €4,311 million
(€4,182 million), up 3.1%. During the same period, the grocery sales of K-food
stores increased by 3.9% (VAT 0%). The sales of Pirkka products grew by 11.8%
(VAT 0%). In the grocery market, retail prices are estimated to have changed
by some 5% compared to the previous year (VAT 0%, Kesko's own estimate based
on the Consumer Price Index of Statistics Finland), and the total market (VAT
0%) is estimated to have grown by some 5% in January-December compared to the
previous year (Kesko's own estimate).

In January-December, the operating profit excluding non-recurring items of the
food trade was €168.4 million (€172.2 million), or €3.8 million down on the
previous year. The operating profit performance was impacted by the expansion
of the store site network and costs related to launching business operations
in Russia. Profitability improved towards the end of the year as a result of
enhanced operations and cost adjustments. Operating profit was €171.1 million
(€173.7 million). Non-recurring income included €2.7 million of gains on
disposals of properties.

The capital expenditure of the food trade was €200.0 million (€221.5 million).

October-December 2012
In the food trade, the net sales for October-December were €1,132 million
(€1,108 million), up 2.2%. The last quarter had one less delivery days than in
the previous year. During the same period, the grocery sales of K-food stores
increased by 2.6% (VAT 0%).

In October-December, the operating profit excluding non-recurring items of the
food trade was €45.0 million (€38.6 million), or €6.4 million up on the
previous year. Profitability improved towards the end of the year as a result
of enhanced operations and cost adjustments. The costs for the reporting
period were increased by the launch of business operations in Russia and costs
related to personnel reductions. Operating profit was €45.0 million (€40.0
million).

The capital expenditure of the food trade for October-December was €43.3
million (€62.3 million).

In October-December 2012, the most significant new store openings included
Kesko's first food store in Russia, opened in St. Petersburg, and one new
K-citymarket and three K-supermarkets opened in Finland.

The most significant store sites being built in Finland are the new
K-citymarkets in Kokkola and in the Puuvilla shopping centre in Pori. The
objective in Russia is to open three new food stores in 2013.

Numbers of stores                       2012 2011
K-citymarket                              80   75
K-supermarket                            210  205
K-market (incl. service station stores)  452  453
K-ruoka, Russia                            1    -
Others                                   194  231

Home and speciality goods trade

                                     1-12/2012 1-12/2011 10-12/2012 10-12/2011
Net sales, € million                     1,603     1,564        487        501
Operating profit excl. non-recurring
items, € million                          19.8      36.6       32.4       32.9
Operating profit as % of net sales
excl. non-recurring items                  1.2       2.3        6.7        6.6
Capital expenditure,
€ million                                 61.1      61.8       13.4       11.3
Net sales, € million                 1-12/2012 Change, % 10-12/2012  Change, %
K-citymarket home and speciality
goods                                      664      +3.4        206       -0.5
Anttila                                    468      -1.3        152       -6.5
Intersport, Finland                        181      +6.9         55       +4.5
Intersport, Russia                          28         -          8      +28.5
Indoor                                     184      +3.4         46       -1.8
Musta Pörssi                                57     -22.3         16      -28.2
Kenkäkesko                                  23      +3.6          4       -2.1
Total                                    1,603      +2.5        487       -2.8

January-December 2012
In the home and speciality goods trade, the net sales for January-December
were €1,603 million (€1,564 million), up 2.5%. The sales of K-citymarket home
and speciality goods, Intersport Finland, Budget Sport, as well as Asko and
Sotka grew from the previous year. In addition, the sales performances of all
online stores were positive. The sales of Anttila and Musta Pörssi decreased
from the previous year.

The operating profit excluding non-recurring items of the home and speciality
goods trade for January-December was €19.8 million (€36.6 million). Intersport
Finland, Budget Sport, Asko and Sotka achieved positive profit performances.
Profit was negatively impacted by a decrease in Anttila's sales and
profitability, and the loss from Intersport's business operations in Russia.
The operating profit excluding non-recurring items was positively impacted by
a €8.7 million amount recognised as revenue in connection with the transfer of
the pension insurance portfolio.

Operating profit was €0.3 million (€37.0 million). Non-recurring items include
an impairment charge of €-23.4 million on Anttila's goodwill and a €21.3
million reversal of the impairment of Indoor's brands. In addition, a
non-recurring expense of €-16.8 million was recognised for a significant
adjustment of Musta Pörssi's store network. An online store has been
established as Musta Pörssi's primary customer channel, supported by a limited
network of stores operating in shopping centres.

The capital expenditure of the home and speciality goods trade for
January-December was €61.1 million (€61.8 million).

October-December 2012
In the home and speciality goods trade, the net sales for October-December
were €487 million (€501 million), down 2.8%. Intersport Finland, Budget Sport
and Intersport in Russia increased their sales. E-commerce sales also
increased. The sales of Anttila and Musta Pörssi decreased from the previous
year.

The operating profit excluding non-recurring items of the home and speciality
goods trade for October-December was €32.4 million (€32.9 million), or €0.6
million down on the previous year. The operating profit excluding
non-recurring items was positively impacted by a €8.7 million amount
recognised as revenue in connection with the transfer of the pension insurance
portfolio. Profit was negatively impacted by a decrease in Anttila's sales and
the loss-making Intersport operations in Russia, partly attributable to
restructuring costs recognised for the adjustment of the store site network.
Operating profit was €12.9 million (€32.9 million).

The capital expenditure of the home and speciality goods trade was €13.4
million (€11.3 million).

In October-December 2012, the most significant new store openings included one
Kodin1 department store and one K-citymarket, as well as the citymarket.fi,
mustaporssi.fi and kookenka.fi online stores.

Numbers of stores*                                              2012 2011
K-citymarket, home and speciality goods                           81   75
Anttila department stores                                         32   31
Kodin1 department stores for home goods and interior decoration   13   11
Intersport                                                        62   56
Budget Sport                                                      10    8
Asko and Sotka                                                    83   81
Musta Pörssi                                                      32   35
Kookenkä                                                         45   37
Anttila, Baltics (NetAnttila)                                      3    3
Intersport, Russia                                                29   36
Asko and Sotka, Baltics                                           10    9

*incl. online stores

Building and home improvement trade

                                     1-12/2012 1-12/2011 10-12/2012 10-12/2011
Net sales, € million                     2,827     2,716        657        657
Operating profit excl. non-recurring
items, € million                          13.6      26.6      -10.8       -4.4
Operating profit as % of net sales
excl.
non-recurring items                        0.5       1.0       -1.6       -0.7
Capital expenditure, € million            63.1     109.8       20.7       20.6
Net sales, € million                 1-12/2012 Change, % 10-12/2012  Change, %
Rautakesko, Finland                      1,229      -0.3        273       -8.1
K-rauta, Sweden                            214      -0.5         46       -5.9
Byggmakker, Norway                         636      +7.4        145       +1.3
Rautakesko, Estonia                         64      +7.0         16       +3.0
Rautakesko, Latvia                          51      -2.9         13       -2.5
Senukai, Lithuania                         266      +6.7         73       +7.3
Stroymaster, Russia                        284     +19.6         70      +13.2
OMA, Belarus                                87      +7.7         23       (..)
Total                                    2,827      +4.1        657       +0.1

January-December 2012
In the building and home improvement trade, the net sales for January-December
were €2,827 million (€2,716 million), up 4.1%. The sales of the building and
home improvement trade increased especially in Russia, which was attributable
to market growth, as well as a new store opened in Moscow during the year. The
market growth rate of the building and home improvement trade fell during the
last quarter in the other operating countries, especially in the Nordic
countries.

In Finland, the net sales for January-December were €1,229 million (€1,233
million), a decrease of 0.3%. The building and home improvement product lines
contributed €851 million to the net sales in Finland, a decrease of 4.6%. The
agricultural supplies trade contributed €378 million to the net sales, up
10.8%.

The retail sales of the K-rauta and Rautia chains in Finland matched the
previous year's level at €1,073 million (VAT 0%). The sales of Rautakesko B2B
Service, mainly deriving from basic building materials, decreased by 7.5%. As
a whole, the Rautakesko chains' retail and B2B sales performance is estimated
to have exceeded that of the Finnish market. The retail sales of the
K-maatalous chain were €463 million (VAT 0%), up 11.1%.

In January-December, the net sales from the foreign operations of the building
and home improvement trade were €1,598 million (€1,483 million), an increase
of 7.8%. In Sweden, net sales were down by 4.1% in terms of kronas. In Norway,
net sales increased by 3.0% in terms of krones. In Russia, net sales increased
by 16.8% and in Belarus, by 67.5% in terms of roubles. Foreign operations
contributed 56.5% (54.6%) to the net sales of the building and home
improvement trade.

The operating profit excluding non-recurring items of the building and home
improvement trade for January-December was €13.6 million (€26.6 million). In
addition to contracted sales towards the year end, profit performance was
impacted by new store openings in Sweden and Russia, and write-offs on
inventories, trade receivables and raised import duties. Operating profit was
€11.9 million (€26.3 million).

In January-December, the capital expenditure of the building and home
improvement trade totalled €63.1 million (€109.8 million), of which 51.4%
(85.8%) abroad.

October-December 2012
In the building and home improvement trade, the net sales for October-December
were €657 million (€657 million), up 0.1%. During the last quarter, the growth
rate of building and home improvement market fell especially in the Nordic
countries and Latvia. In Russia, sales growth continued, in St. Petersburg,
the growth rate fell.

In Finland, net sales were €273 million (€297 million), a decrease of 8.1%.
The building and home improvement product lines contributed €172 million to
the net sales in Finland, a decrease of 15.0%. The agricultural supplies trade
contributed €100 million to the net sales, up 6.7%.

In October-December, the retail sales of the K-rauta and Rautia chains in
Finland decreased by 4.0% to €247 million (VAT 0%). The sales of Rautakesko
B2B Service decreased by 23.2%. The retail sales of the K-maatalous chain were
€133 million (VAT 0%), up 15.0%.

The net sales from foreign operations in the building and home improvement
trade were €385 million (€360 million), an increase of 6.8%. The net sales
from foreign operations grew by 1.8% in terms of local currencies. In Sweden,
net sales were down by 11.0% in terms of kronas. In Norway, net sales
decreased by 4.0% in terms of krones. In Norway, the chain agreements of two
retailers expired at the end of 2012. Their contribution to Byggmakker's net
sales slightly exceeded 20%. In Russia, net sales increased by 9.1% in terms
of roubles and in Belarus, net sales increased by 61.5% in terms of roubles
compared to 2011 due to high price increases. Foreign operations contributed
58.5% (54.9%) to the net sales of the building and home improvement trade.

The operating profit excluding non-recurring items of the building and home
improvement trade for October-December was €-10.8 million (€-4.4 million). In
addition to contracted sales towards the year end, profit performance was
impacted by new store openings in Sweden and Russia, and write-offs on
inventories, trade receivables, raised import duties and personnel reductions.
Operating profit was €-10.8 million (€-4.5 million).

The capital expenditure of the building and home improvement trade totalled
€20.7 million (€20.6 million), of which 50.4% (85.8%) abroad.

In October-December, two building and home improvement stores were opened in
Belarus. In December, a K-rauta was closed in Helsingborg, Sweden and a
K-rauta in Tallinn, Estonia. A replacement K-rauta is being built in Turku and
a K-rauta in Moscow.

Numbers of stores  2012 2011
K-rauta*             42   41
Rautia*              99  106
K-maatalous*         83   88
K-rauta, Sweden      21   21
Byggmakker, Norway  106  110
K-rauta, Estonia      8    9
K-rauta, Latvia       8    8
Senukai, Lithuania   17   17
K-rauta, Russia      14   14
OMA, Belarus          9    6

*in 2012, 1 K-rauta store and 48 Rautia stores also operated as K-maatalous
stores,
in 2011, 1 K-rauta store and 49 Rautia stores also operated as K-maatalous
stores

Car and machinery trade

                               1-12/2012 1-12/2011 10-12/2012 10-12/2011
Net sales, € million               1,114     1,174        227        263
Operating profit excl.
non-recurring items,
€ million                           42.1      51.8        4.7        7.0
Operating profit as %
of net sales excl.
non-recurring items                  3.8       4.4        2.1        2.6
Capital expenditure, € million      26.6      29.9        3.2        9.4
Net sales, € million           1-12/2012 Change, % 10-12/2012  Change, %
VV-Auto                              790      -6.9        168      -17.3
Konekesko                            325      -0.5         59       -2.4
Total                              1,114      -5.1        227      -13.7

January-December 2012
In January-December, the net sales of the car and machinery trade were €1,114
million (€1,174 million), down 5.1%.

VV-Auto's net sales for January-December were €790 million (€849 million), a
decrease of 6.9% compared to the previous year, as a result of a decrease of
the total market. In Finland, new registrations of passenger cars decreased by
11.8% and those of vans by 20.9% compared to the previous year. In
January-December, the combined market share of passenger cars and vans
imported by VV-Auto was 20.2% (20.7%). Volkswagen was the best selling
passenger car and van brand in Finland in 2012.

Konekesko's net sales for January-December were €325 million (€326 million),
down 0.5% compared to the previous year. Net sales in Finland were €211
million, down 3.6%. The net sales from Konekesko's foreign operations were
€116 million, up 4.9%.

In January-December, the operating profit excluding non-recurring items of the
car and machinery trade was €42.1 million (€51.8 million), down €9.7 million.
Regardless of the sales decrease, profitability remained at a good level. The
operating profit for January-December was €42.1 million (€51.9 million).

The capital expenditure of the car and machinery trade for January-December
was €26.6 million (€29.9 million).

October-December 2012
In October-December, the net sales of the car and machinery trade were €227
million (€263 million), down 13.7%.

VV-Auto's net sales for October-December were €168 million (€203 million), a
decrease of 17.3%. The sales decrease of the car trade was attributable to
more difficult conditions in the market for passenger cars and vans. In
October-December, the combined market share of passenger cars and vans
imported by VV-Auto was 19.8% (21.6%).

Konekesko's net sales for October-December were €59 million (€61 million),
down 2.4% compared to the previous year.

In October-December, the operating profit excluding non-recurring items of the
car and machinery trade was €4.7 million (€7.0 million), down €2.2 million
compared to the previous year. Profitability was weakened by the sales
decrease of the car trade. The operating profit for October-December was €4.7
million (€7.0 million).

The capital expenditure of the car and machinery trade in October-December was
€3.2 million (€9.4 million).

Numbers of stores     2012 2011
VV-Auto, retail trade   10    9
Konekesko                1    2

Changes in the Group composition
No significant changes took place in the Group composition during the
reporting period.

Shares, securities market and Board authorisations
At the end of December 2012, the total number of Kesko Corporation shares was
98,712,340, of which 31,737,007, or 32.2%, were A shares and 66,975,333, or
67.8%, were B shares. At 31 December 2012, Kesko Corporation held 608,591 own
B shares as treasury shares, the subsidiaries do not hold Kesko Corporation
shares. Treasury shares account for 0.91% of the number of B shares and 0.62%
of the total number of shares, and 0.16% of votes carried by all shares of the
company. Each A share entitles to ten (10) votes and each B share to one (1)
vote. The company cannot vote with treasury shares and no dividend is paid on
them. At the end of December 2012, Kesko Corporation's share capital was
€197,282,584. During the reporting period, the number of B shares was
increased five times to account for the shares subscribed for with the options
based on the 2007 option scheme. The increases were made on 5 June 2012 (4,500
B shares), 31 July 2012 (600 B shares), 30 October 2012 (26,038 B shares), 28
November 2012 (17,550 B shares) and 27 December 2012 (18,610 B shares) and
announced in stock exchange notifications on the same days. The shares
subscribed for were listed for public trading on NASDAQ OMX Helsinki (Helsinki
Stock Exchange) with the old B shares on 6 June 2012, 1 August 2012, 31
October 2012, 29 November 2012 and 28 December 2012. The combined subscription
price of €962,365.02 received by the company was recorded in the reserve of
invested non-restricted equity.

The price of a Kesko A share quoted on NASDAQ OMX Helsinki was €24.82 at the
end of 2011, and €24.39 at the end of December 2012, representing a decrease
of 1.7%. Correspondingly, the price of a B share was €25.96 at the end of
2011, and €24.77 at the end of December 2012, representing a decrease of 4.6%.
In January-December, the highest A share price was €27.65 and the lowest was
€19.99. For B share, they were €27.81 and €18.08 respectively. In
January-December, the Helsinki stock exchange (OMX Helsinki) All-Share index
was up by 8.3% and the weighted OMX Helsinki CAP index by 9.6%. The Retail
Index was down by 0.8%.

At the end of December 2012, the market capitalisation of A shares was €774
million, while that of B shares was €1,644 million, excluding the shares held
by the parent company. The combined market capitalisation of A and B shares
was €2,418 million, a decrease of €89 million from the end of 2011. In 2012, a
total of 2.3 (2.1) million A shares were traded on the Helsinki stock
exchange, up 8.3%. The exchange value of A shares was €57 million. The total
number of B shares traded was 68.5 (63.3) million, up 8.2%. The exchange value
of B shares was €1,560 million. The Helsinki stock exchange accounted for 76%
of all trading in Kesko shares in 2012. In addition, Kesko shares were traded
on multilateral trading facilities, the most significant of which were BATS
Chi-X with 20% and Turquoise with 4% (source: Fidessa).

The company operates the 2007 option scheme for management and other key
personnel, under which the share subscription period of 2007A share options
has expired, that of 2007B share options runs from 1 April 2011 to 30 April
2013, and that of 2007C share options runs from 1 April 2012 to 30 April 2014.
The 2007B and 2007C share options are included on the official list of the
Helsinki stock exchange. During the reporting period, a total of 501,899 2007B
share options were traded at a total value of €1,198,991, and correspondingly,
a total of 250,729 2007C share options were traded at a total value of
€2,435,669.

The Board has the authority, granted by the Annual General Meeting of 16 April
2012 and valid until 30 June 2015, to issue a total maximum of 20,000,000 new
B shares. In addition, the Board has the authority, granted by the Annual
General Meeting of 4 April 2011 and valid until 30 June 2014, to decide on the
issuance of a total maximum of 1,000,000 own B shares held by the company
itself. The authority granted by the Annual General Meeting of 4 April 2011 to
acquire a total maximum of 1,000,000 own B shares expired on 30 September
2012. Based on the authority to issue own shares and the fulfilment of the
vesting criteria of the 2011 vesting period of Kesko's three-year share-based
compensation plan, the Board granted a total of 92,751 company shares held by
the company itself to the persons included in the target group. The matter was
announced in a stock exchange release on 12 April 2012. After the vesting
period, a total of 1,342 shares already transferred have been returned to the
company in accordance with the terms of the share-based compensation plan. The
returns were announced in stock exchange notifications on 20 July 2012 and 9
November 2012. Further information on the Board's authorities is available at
www.kesko.fi.

At the end of December 2012, the number of shareholders was 44,554, which is
3,339 more than at the end of 2011. At the end of December, foreign ownership
of all shares was 18%. At the end of December, foreign ownership of B shares
was 27%.

Flagging notifications
Kesko Corporation did not receive flagging notifications during the reporting
period.

Main events during the reporting period
The second phase of the transfer of the Kesko Group companies' statutory
pension insurance liability portfolio, agreed between the Kesko Pension Fund
and Ilmarinen Mutual Pension Insurance Company, was carried out with effect
from 1 January 2012. (Stock exchange release on 15 February 2012)

On 12 April 2012, Kesko transferred a total of 90,889 own B shares held by the
company itself to the about 150 Kesko management employees and other named key
persons included in the target group of the 2011 vesting period of Kesko's
three-year share-based compensation plan. In addition, on the same basis,
Kesko transferred a total of 1,862 own B shares held by the company itself in
May. After the transfers, the company itself held 607,249 own B shares.
(Stock exchange release on 12 April 2012)

On 11 September 2012, Kesko Corporation issued a €250 million unsecured bond.
The six-year bond will mature on 11 September 2018 and it carries a fixed
annual interest at the rate of 2.75 percent. NASDAQ OMX Helsinki admitted the
bond to public trading as from 12 September 2012. (Stock exchange release on 4
and 11 September 2012)

Matti Mettälä, 49, Master of Laws, was appointed Senior Vice President and
member of Kesko's Corporate Management Board responsible for human resources
and stakeholder relations starting from 1 October 2012. Starting from 1
October 2012, Kesko's Corporate Management Board is composed of Matti
Halmesmäki, Chair; Terho Kalliokoski, responsible for the food trade; Minna
Kurunsaari, responsible for the home and speciality goods trade and Kesko's
electronic marketing and services projects; Arja Talma, responsible for the
building and home improvement trade; Pekka Lahti, responsible for the car and
machinery trade; Jukka Erlund, responsible for finance, treasury and IT
management; and Matti Mettälä, responsible for human resources and stakeholder
relations. (Stock exchange release on 21 September 2012)

Kesko's profitability programme is progressing. The objective is to achieve
cost savings of €100 million. Most of the savings are expected to be achieved
in 2013. The profitability programme covers all of Kesko's divisions. The aim
is to reduce especially marketing, personnel, rent and information system
expenses. (Stock exchange release on 24 September 2012)

The Financial Supervisory Authority gave its permission to the Kesko Pension
Fund to return the surplus assets accumulated in its department B, which
managed the pension fund's statutory pension insurance provision, to the Kesko
Group companies. The surplus returned from the pension fund to the Group
companies generated a cash inflow of approximately €71 million. (Stock
exchange release on 14 December 2012)

Resolutions of the 2012 Annual General Meeting and decisions of the Board's
organisational meeting
Kesko Corporation's Annual General Meeting, held on 16 April 2012, adopted the
financial statements for 2011 and discharged the Board members and the
Managing Director from liability. The General Meeting also resolved to
distribute €1.20 per share as dividends on 98,035,931 shares held outside the
company at the date of dividend distribution, or a total amount of
€117,643,117.20. The dividend pay date was 26 April 2012. The General Meeting
resolved to leave the number of Board members unchanged at seven and elected
Esa Kiiskinen, Ilpo Kokkila, Tomi Korpisaari, Maarit Näkyvä, Seppo
Paatelainen, Toni Pokela and Virpi Tuunainen as Board members for a three-year
term of office as stated in the Articles of Association. The General Meeting
elected PricewaterhouseCoopers Oy as the company's auditor, with Johan
Kronberg, APA, as the company's auditor with principal responsibility. The
General Meeting also approved the Board's proposal to issue a total maximum of
20,000,000 new B shares until 30 June 2015, and the Board's proposal that it
be authorised until the 2013 Annual General Meeting to decide on the donation
of a total maximum of €300,000 for charitable or corresponding purposes.

The organisational meeting of Kesko Corporation's Board of Directors, held
after the Annual General Meeting, elected Esa Kiiskinen as its Chair and Seppo
Paatelainen as its Deputy Chair. The Board elected Maarit Näkyvä as the Chair,
Seppo Paatelainen as the Deputy Chair and Virpi Tuunainen as a member of the
Audit Committee, and Esa Kiiskinen as the Chair, Seppo Paatelainen as the
Deputy Chair and Ilpo Kokkila as a member of the Remuneration Committee. The
Board elects the Board Chair and Deputy Chair for the whole three-year term of
a Board member, and the Committee Chairs, Deputy Chairs and members for one
year at a time.

The resolutions of the Annual General Meeting and the decisions of the Board's
organisational meeting were announced in more detail in stock exchange
releases on 16 April 2012.

Responsibility
In January 2012, Kesko was included on 'The Global 100 Most Sustainable
Corporations in the World' list for the eighth time.

In February, World Finance Magazine recognised Kesko for the best corporate
governance in Finland in terms of development and reporting for a second
successive year.

In March, the US Ethisphere Institute listed Kesko as one of the World's Most
Ethical Companies for 2012.

Kesko's Board of Directors granted scholarships in a total of €41,000 to
talented young athletes and art students.

For the tenth time, Kesko was included in the Dow Jones sustainability indexes
DJSI World and DJSI Europe. Kesko's total score increased from the previous
year and Kesko was given the highest scores in four areas in its sector.

Kesko was again included in the FTSE4Good index. Kesko's overall rating for
2012 was 96 out of 100, which is four points up from the previous year. The
score given to Kesko's work for curbing climate change was 5 on the scale of
0-5.

  Kesko was included in the STOXX Global ESG Leaders index for the second time

Kesko is also one of the 100 companies on SSP Fonder's list of the world's 100
most responsible companies.

In October, Kesko was awarded the highest score in the Consumer Staples sector
in the assessment by the Nordic Carbon Disclosure Leadership climate index.
Kesko was included in the index for a second successive year.

Risk management
Kesko's risk management is proactive and an integral part of its management
and day-to-day activities. The objective of risk management is to ensure the
delivery of customer promises, profit performance, dividend payment capacity,
shareholder value, the implementation of responsible operating practices and
the continuity of operations in the Kesko Group.

Risk management in the Kesko Group is guided by the risk management policy
confirmed by the Board of Directors. The policy defines the objectives and
principles, organisation, responsibilities and practices of risk management in
the Kesko Group. The management of financial risks is based on the Group's
finance policy, which is confirmed by Kesko's Board of Directors. The business
division and Group managements are responsible for the execution of risk
management.

The Kesko Group applies a business-oriented and comprehensive approach to risk
assessment and management. This means that key risks are systematically
identified, assessed, managed, monitored and reported at the Group, division,
company and unit levels in all operating countries.

Kesko has a uniform risk assessment and reporting system. Risk identification
is based on business objectives and opportunities and the defined risk
appetite. Risks are prioritised on the basis of their significance by
assessing the impact and probability of their materialisation and the level of
risk management. When assessing the impact of materialisation, the impacts on
reputation, people's wellbeing and the environment are considered in addition
to financial impacts.

In connection with the strategy process, the divisions assess the risks and
opportunities concerning each strategic period. Near-future risks are
identified and assessed in accordance with the rolling planning framework.
Risk assessment also covers the risks concerning each division's subsidiaries
and significant projects.

A division's risk assessment, which includes risk management responses,
responsible persons and schedules, is considered by the division's management
board or the division parent company's Board quarterly prior to the disclosure
of the interim report. The Group functions also assess the risks concerning
their responsibility areas.

Risks and management responses are reported in accordance with Kesko's
reporting responsibilities. The divisions report on risks and changes in risks
to the Group's risk management function on a quarterly basis. Risks are
discussed by the risk reporting team including representatives of the
divisions and the Group functions. On that basis, the Group's risk management
function prepares the Group's risk map, which presents the most significant
risks and uncertainties and their management.

The Group's risk map is considered by the Kesko Board's Audit Committee in
connection with considering the quarterly interim reports and the financial
statements. The Chair of the Audit Committee reports on risk management to the
Board as part of the Audit Committee's report. The Kesko Board considers the
Kesko Group's most significant risks and uncertainties and their management
responses, and assesses the efficiency and performance of risk management at
least once a year. The most significant risks and uncertainties are reported
to the market by the Board in the financial statements, and any material
changes in them in the interim reports.

The following describes the risks and uncertainties assessed as significant.

Significant risks and uncertainties
A possible further weakening of economic development, increases in taxes and
public payments resulting from the indebtedness of the public sector, coupled
with increasing unemployment will weaken purchasing power and consumer
confidence, in addition to negatively impacting especially the home and
speciality goods trade, the building and home improvement trade and the car
and machinery trade. In the food trade, the impacts can be seen in consumption
moving towards more affordable alternatives.

E-commerce and e-services are becoming increasingly popular in the retail
trade. International e-commerce increases consumers' alternatives at the same
time when buying and marketing of products and services become more
personalised and increasingly take place online. Buying decisions are
increasingly often made based on online information. The achievement of
objectives requires attractive e-services and retail websites, utilisation of
a multi-channel approach and electronic customer communications to support it.
The risk is that the progress of our e-commerce and e-service development
projects is outpaced by competitors, or that competing online stores and
e-services are more attractive to customers.

As part of capital expenditure prioritisation, Kesko has specified its
expansion plans in Russia for the food trade, the building and home
improvement trade and the sports trade. The key in expansion is to succeed in
the acquisition and building of well located store sites, the development of
store concepts, purchasing operations and logistics, as well as the
recruitment of key personnel. The country risks in Russia, such as corruption,
unpredictability of officials and rapid changes in laws and their application,
coupled with unexpected changes in the operating environment can delay the
expansion and make business operations more difficult.

The implementation of changes in business operations requires increasingly
sophisticated management and control systems and information systems
supporting them. Rautakesko's expansion abroad, for example, and the adoption
of a uniform selection management, and the integration of K-citymarket home
and speciality goods and Anttila with related changes in business operations
are long-term projects. Failures in change management, technological choices
and the adoption of new operating models and systems would delay the
implementation of changes in business operations.

The regulations on the food trade are tightening. Public discussion about food
prices and the position of operators in the supply chain has increased.
Increasing regulations restricting competitive trading conditions are being
imposed in Finland and also by the European Union. Such a development can
weaken the trading sector's possibilities to serve customers and operate
efficiently.

Kesko's chain operations are, contrary to most competitors, based on a
retailer business model to a significant extent. The benefits of the retailer
business model include the retailer's knowledge of local customers and ability
to rapidly respond to changes in customer needs or competitive situations.
Decision-making concerning the development of the chains' operations and the
implementation of changes in business operations can, however, be outpaced by
competitors.

The trading sector is characterised by increasingly complicated and long
supply chains and a dependency on information systems, data communications and
external service providers. Failures in information and payment systems, or in
other parts of the supply chain can cause significant losses in sales and
weaken customer satisfaction.

For the purpose of increasing market share, good store sites are a key
competitive factor. The acquisition of store sites can be delayed by zoning
and permit procedures and the availability and pricing of sites. Considerable
amounts of capital or lease liabilities are tied up in store properties for
years. Resulting from changes in the market situation, or an increase in the
share of e-commerce, there is a risk that a store site becomes unprofitable
and operations are discontinued while long-term liabilities remain.

A failure in product safety control or in the quality assurance of the supply
chain can result in financial losses, the loss of customer confidence or, in
the worst case, a health hazard to customers.

In lines of business strongly dependent on individual principals and
suppliers, such as the car and machinery trade, ownership arrangements and
changes in a principal's or supplier's strategy concerning product selections,
pricing and distribution channel solutions can mean weakened competitiveness,
decreased sales, or loss of business.

Crimes are increasingly committed through data networks and crime is becoming
more professional. A failure especially in the protection of payment
transactions and personal information can cause losses, claims for damages and
endanger reputation. There is a risk that controls against such crime are not
sufficient.

Different aspects of responsibility, such as ethicality of production and
sourcing, fair and equal treatment of employees and environmental protection
are increasingly important for customers and other stakeholders. Possible
failures of responsibility would result in negative publicity for Kesko.
Kesko's challenges in responsibility work include communicating its
responsibility policies to suppliers, retailers and customers, and ensuring
responsibility in the supply chain.

Compliance with laws and agreements is an important part of Kesko's
responsibility. Non-compliance can result in fines, compensations for damages
and other financial losses, and a loss of confidence and reputation.

Kesko's objective is to produce and publish reliable and timely information.
If some information published by Kesko proved to be incorrect, or
communications failed to meet regulations in other respects, it can result in
losing investor and other stakeholder confidence and in possible sanctions.

Accidents, natural phenomena and epidemics can cause damages or business
interruptions which cannot be prevented. There is also the risk that
insurances do not cover all unexpected accidents and damages.

Other risks and uncertainties related to profit performance are described in
the Group's future outlook.

Future outlook
Estimates of the future outlook for the Kesko Group's net sales and operating
profit excluding non-recurring items are given for the 12 months following the
reporting period (1/2013-12/2013) in comparison with the 12 months preceding
the reporting period (1/2012-12/2012).

Resulting from the problems of European national economies, the outlook for
the general economic situation and consumer demand are characterised by
significant uncertainty. In addition, tightening taxation and cuts in public
finances are expected to weaken the growth in the trading sector.

In the Finnish grocery trade, the market is expected to remain steady. As a
result of the weakened economic situation, the markets for the home and
speciality goods trade, the building and home improvement trade and the car
and machinery trade in Finland are expected to fall. In Russia, the market
development in both the building and home improvement trade and the grocery
trade is expected to be positive.

The Kesko Group's net sales for 2013 are expected to match the level of the
previous year. As a result of measures taken to enhance business operations
and cost savings, the operating profit excluding non-recurring items for 2013
is expected to exceed the operating profit excluding non-recurring items for
2012, unless the overall consumer demand significantly weakens. The capital
expenditure for 2013 is expected to be lower compared to the capital
expenditure for the previous year.

Proposal for profit distribution
The parent's distributable profits are €1,141,220,145.13, of which the profit
for the financial year is €154,424,274.87.

The Board of Directors proposes to the Annual General Meeting to be held on 8
April 2013 that a dividend of €1.20 per share be paid on shares held outside
the company at the date of dividend distribution. No dividend is paid on
treasury shares held by the company at the record date of dividend
distribution.

At the date of the proposal for distributions of profits, 4 February 2013, a
total of 98,103,749 shares were held outside the Company, amounting to a total
dividend of €117,724,498.80.

Annual General Meeting
The Board of Directors decided to convene the Annual General Meeting at the
Helsinki Fair Centre on 8 April 2013 at 13.00. Kesko Corporation will publish
a notice of the Annual General Meeting at a later date.

Annual Report 2012 and Corporate Governance Statement
Kesko will publish the 2012 Annual Report, which contains the report by
Kesko's Board of Directors and the financial statements for 2012, and a
separate Corporate Governance Statement on week 10 on its website at
www.kesko.fi.

Helsinki, 4 February 2013
Kesko Corporation
Board of Directors

The information in the financial statements release is unaudited.

Further information is available from Jukka Erlund, Senior Vice President,
CFO, telephone +358 1053 22113, and Eva Kaukinen, Vice President, Corporate
Controller, telephone +358 1053 22338. A Finnish-language webcast from the
media and analyst briefing on the financial statements can be accessed at
www.kesko.fi at 11.00. An English-language web conference on the financial
statements will be held today at 14.30 (Finnish time). The web conference
login is available on Kesko's website at www.kesko.fi.

Kesko Corporation's interim report for January-March will be released on 25
April 2013. In addition, the Kesko Group's sales figures are published each
month. News releases and other company information are available on Kesko's
website at www.kesko.fi.

KESKO CORPORATION

Merja Haverinen
Vice President, Corporate Communications

ATTACHMENTS:
Accounting policies
Consolidated statement of comprehensive income
Consolidated statement of financial position
Consolidated statement of changes in equity
Consolidated statement of cash flows
Group's performance indicators
Net sales by segment
Operating profit by segment
Operating profit excl. non-recurring items by segment
Operating margin excl. non-recurring items by segment
Capital employed by segment
Return on capital employed excl. non-recurring items by segment
Capital expenditure by segment
Segment information by quarter
Personnel average and at the end of the reporting period
Group's commitments
Calculation of performance indicators
K-Group's retail and B2B sales

DISTRIBUTION
NASDAQ OMX Helsinki
Main news media
www.kesko.fi

ATTACHMENTS:

Accounting policies

This financial statements release has been prepared in accordance with the IAS
34 standard. The financial statements release has been prepared in accordance
with the same principles as the annual financial statements for 2011, with the
exception of the following changes due to the adoption of new and revised IFRS
standards and IFRIC interpretations.

IFRS 7 Financial instruments: Disclosures - Derecognition (Amendment)
IAS 12 Income taxes - Deferred tax (Amendment)
Annual amendments to the IFRS (Annual Improvements)

The above amendments to standards and interpretations do not have a material
impact on the reported income statement, statement of financial position or
notes.

Consolidated income statement
(€ million), condensed
                                 1-12/  1-12/ Change,% 10-12/ 10-12/ Change,%
                                  2012   2011            2012   2011
Net sales                        9,686  9,460      2.4  2,459  2,481     -0.9
Cost of goods sold              -8,367 -8,163      2.5 -2,108 -2,126     -0.8
Gross profit                     1,319  1,297      1.7    351    356     -1.3
Other operating income             747    705      6.0    197    188      4.5
Staff cost                        -603   -571      5.7   -155   -156     -0.8
Depreciation and impairment
charges                           -158   -125     27.1    -45    -35     30.0
Other operating expenses        -1,088 -1,026      6.0   -295   -280      5.3
Operating profit                   217    281    -22.8     53     73    -27.6
Interest income and other
finance income                      21     22     -5.2      8      6     32.5
Interest expense and other
finance costs                      -17    -18     -4.3     -6     -5     24.4
Exchange differences                -5     -3     31.3     -1     -1     81.8
Income from associates              -1      1     (..)     -1      0     (..)
Profit before tax                  215    282    -23.7     53     74    -28.4
Income tax                         -76    -85    -11.1    -27    -19     44.8
Net profit for the period          139    197    -29.2     26     55    -53.2
Attributable to
 Owners of the parent             128    182    -29.5     24     50    -52.8
 Non-controlling 
 interests                         11     15    -25.9      2      5    -57.0
Earnings per share (€)
for profit attributable to
equity holders of the parent
Basic                             1.31   1.85  -29.4     0.24   0.51    -52.7
Diluted                           1.30   1.84  -29.2     0.24   0.51    -52.6
Consolidated statement
of comprehensive
income (€ million)
                                 1-12/  1-12/ Change,% 10-12/ 10-12/ Change,%
                                  2012   2011            2012   2011
Net profit for the period          139    197    -29.2     26     55    -53.2
Other comprehensive income
Exchange differences on
translating foreign operations       0    -17     (..)     -3      2     (..)
Adjustment for hyperinflation        4      6    -37.8      1      6     36.2
Cash flow hedge revaluation         -3    -15    -82.8     -1     -3    -56.8
Revaluation of available-for-
sale financial assets                9      0     (..)     -3      0     (..)
Other items                          0      0     54.2      0      0        -
Tax relating to other
comprehensive income                 1      4    -81.9      3      1     (..)
Total other comprehensive
income for the period,
net of tax                          10    -22     (..)     -3      6     (..)
Total comprehensive income for
the period                         150    175    -14.3     23     61    -62.3
Attributable to
 Owners of the parent             136    170    -20.2     20     52    -60.4
 Non-controlling
 interests                         14      4     (..)      3      9    -72.7

(..) Change over 100%

Consolidated statement of financial position
(€ million), condensed
                                              31.12.2012 31.12.2011 Change, %
ASSETS
Non-current assets
Tangible assets                                    1,678      1,490      12.6
Intangible assets                                    192        189       1.4
Investments in associates and other
financial assets                                     105         69      53.4
Loans and receivables                                 91         80      10.6
Pension assets                                       147        200     -26.6
Total                                              2,213      2,029       9.0
Current assets
Inventories                                          814        868      -6.2
Trade receivables                                    703        700       0.4
Other receivables                                    153        218     -29.8
Financial assets at fair value
through profit or loss                               137         98      40.4
Available-for-sale financial assets                  249        186      34.2
Cash and cash equivalents                            103         84      22.5
Total                                              2,160      2,153       0.3
Non-current assets held for sale                       2          8     -71.2
Total assets                                       4,375      4,190       4.4

                                       31.12.2012 31.12.2011 Change, %
EQUITY AND LIABILITIES
Equity                                      2,200      2,175       1.2
Non-controlling interests                      67         58      14.4
Total equity                                2,267      2,233       1.5
Non-current liabilities
Interest-bearing liabilities                  450        210      (..)
Non-interest-bearing liabilities               10         18     -44.1
Deferred tax liabilities                       79         91     -15.9
Pension obligations                             2          2      -4.7
Provisions                                     21         10      98.0
Total                                         562        332      68.5
Current liabilities
Interest-bearing liabilities                  174        190      -8.2
Trade payables                                808        886      -8.7
Other non-interest-bearing liabilities        524        526      -0.3
Provisions                                     40         24      66.1
Total                                       1,546      1,625      -4.8
Total equity and liabilities                4,375      4,190       4.4

(..) Change over 100%

Consolidated statement of changes in equity (€ million)

                                  Cur- rency                     Re-
                   Share              trans- Revalu-          tained Non- cont-
                   capi- Reser-       lation   ation Treasury  earn-    rolling
                     tal    ves differ-ences reserve   shares   ings inte-rests Total
Balance at
1 Jan. 2011          197    441           -3      14        0  1,503         59 2,210
Shares
subscribed
with options                  0                                                     0
Treasury shares                                           -23                     -23
Share-based
payments                                                    1      2          0     3
Dividends                                                       -128         -4  -133
Other
changes                       0            0                       0          0     0
Net profit for the
period                                                           182         15   197
Other
comprehensive
income
Exchange
differences on
translating
foreign operations            0           -1                                -17   -17
Adjustment for
hyperinflation                                                     1          6     6
Cash flow hedge
revaluation                                      -15                              -15
Revaluation of
available-for-sale
financial assets                                   0                                0
Other items                                                        0                0
Tax relating to
other
comprehensive
income                                             4                                4
Total other
comprehensive
income                                    -1     -11               0        -11   -22
Balance at
31 Dec. 2011         197    441           -3       3      -22  1,559         58 2,233
Balance at
1 Jan. 2012          197    441           -3       3      -22  1,559         58 2,233
Shares
subscribed
with options                  1                                                     1
Share-based
payments                                                    3      0          0     3
Dividends                                                       -118         -5  -123
Other
changes                                    1                0      3          0     3
Net profit for the
period                                                           128         11   139
Other
comprehensive
income
Exchange
differences on
translating
foreign operations            0            1                                 -1     0
Adjustment for
hyperinflation                                                     0          3     4
Cash flow hedge
revaluation                                       -3                               -3
Change in
revaluation
reserve                                            9                                9
Other items                                                        0                0
Tax relating to
other
comprehensive
income                                             1                                1
Total other
comprehensive
income                        0            1       7               0          2    10
Balance at
31 Dec. 2012         197    442           -2      10      -19  1,573         67 2,267

Consolidated statement of cash flows (€ million), condensed

                                   1-12/ 1-12/ Change,% 10-12/ 10-12/ Change,%
                                    2012  2011            2012   2011
Cash flows from operating
activities
Profit before tax                    215   282    -23.7     53     74    -28.4
Planned depreciation                155   125     23.9     43     35     23.9
Finance income and costs               1    -1     (..)     -2     -1     (..)
Other adjustments                     98    -6     (..)     91    -28     (..)
Change in working capital
Current non-interest-bearing
operating receivables,
increase (-)/decrease (+)              5   -89     (..)     61    -42     (..)
Inventories,
increase (-)/decrease (+)             57  -119     (..)     22    -72     (..)
Current non-interest-bearing
liabilities,
increase (+)/decrease (-)            -70   127     (..)    -75    109     (..)
Financial items and tax              -79  -103    -23.5    -18    -29    -37.9
Net cash from operating activities   382   216     77.0    174     47     (..)
Cash flows from investing
activities
Capital expenditure                 -411  -449     -8.4   -118   -112      4.7
Sales of fixed assets                 24     8     (..)      2      2     -5.1
Increase in non-current
receivables                           -4     0     (..)      0      0     (..)
Net cash used in investing
activities                          -391  -441    -11.4    116   -110      5.1
Cash flows from financing
activities
Interest-bearing liabilities,
increase (+)/decrease (-)            230   -58     (..)     -8    -20    -59.7
Current interest-bearing
receivables,
increase (-)/decrease (+)             37   -37     (..)     86    -39     (..)
Dividends paid                      -123  -133     -7.5     -1     -1     14.2
Equity increase                        1     0     (..)      1      0     (..)
Acquisition of own shares              -   -23     (..)      -      1     (..)
Short-term money market
investments, increase (-)/
decrease (+)                          -2   199     (..)    -39     36     (..)
Other items                          -14     1     (..)     -3      0     (..)
Net cash used in financing
activities                           130   -51     (..)     36    -22     (..)
Change in cash and cash
equivalents                          121  -277     (..)     94    -86     (..)
Cash and cash equivalents and
current portion of
available-for-sale financial
assets at 1 Jan.                     231   509    -54.7    258    315    -18.3
Currency translation difference
adjustment and revaluation             0    -2    -93.8      0      1     (..)
Cash and cash equivalents and
current portion of
available-for-sale financial
assets at 31 Dec.                    352   231     52.5    352    231     52.5

(..) Change over 100%

Group's performance indicators
                                                1-12/2012 1-12/2011 Change, pp
Return on capital employed, %                         8.5      13.2       -4.6
Return on capital employed excl. non-recurring
items, %                                              9.3      13.1       -3.9
Return on equity, %                                   6.2       8.9       -2.7
Return on equity excl. non-recurring items, %         7.1       8.8       -1.8
Equity ratio, %                                      52.5      53.9       -1.4
Gearing, %                                            6.0       1.5        4.5
                                                                     Change, %
Capital expenditure, € million                      378.3     425.4      -11.1
Capital expenditure, % of net sales                   3.9       4.5      -13.3
Earnings per share, basic, €                         1.31      1.85      -29.4
Earnings per share, diluted, €                       1.30      1.84      -29.2
Earnings per share excl. non-recurring items,
basic, €                                             1.50      1.84      -18.2
Cash flow from operating activities,
€ million                                             382       216       77.0
Cash flow from investing activities,
€ million                                            -391      -441      -11.4
Equity per share, €                                 22.43     22.20        1.0
Interest-bearing net debt                             135        33       (..)
Diluted number of
shares, average for
reporting period                                   98,472    98,919       -447
Personnel, average                                 19,741    18,960        781
(..) Change over 100%

Group's performance           1-3/  4-6/  7-9/ 10-12/  1-3/  4-6/  7-9/ 10-12/
indicators by quarter         2011  2011  2011  2011   2012  2012  2012   2012
Net sales, € million         2,103 2,472 2,404  2,481 2,318 2,460 2,449  2,459
Change in net sales, %         7.4   8.5   7.8    7.4  10.2  -0.5   1.9   -0.9
Operating profit, € million   35.7  83.9  88.2   72.8  26.3  59.0  78.6   52.7
Operating margin, %            1.7   3.4   3.7    2.9   1.1   2.4   3.2    2.1
Operating profit excl. non-
recurring items, € million    34.9  83.3  89.2   71.5  23.6  60.7  78.6   71.8
Operating margin excl.
non-recurring items, %         1.7   3.4   3.7    2.9   1.0   2.5   3.2    2.9
Finance income/costs,
€ million                     -0.6   0.3   0.3    0.8  -0.1  -0.3  -1.3    1.1
Profit before tax,
€ million                     36.1  84.0  88.0   74.0  26.3  58.5  77.3   53.0
Profit before tax, %           1.7   3.4   3.7    3.0   1.1   2.4   3.2    2.2
Return on capital employed,
%                              7.2  16.0  16.4   12.8   4.3   9.2  12.2    8.1
Return on capital employed
excl. non-recurring items, %   7.0  15.9  16.6   12.5   3.9   9.5  12.2   11.1
Return on equity, %            4.5  10.6  10.9   10.0   3.3   7.3   9.9    4.6
Return on equity excl.
non-recurring items, %         4.4  10.6  11.1    9.8   3.0   7.5   9.9    8.2
Equity ratio, %               54.4  52.1  54.0   53.9  52.7  51.1  51.2   52.5
Capital expenditure, €
million                       64.1 130.5 126.3  104.5 104.1  67.8 102.6  103.8
Earnings per share, diluted,
€                             0.25  0.55  0.53   0.51  0.17  0.38  0.51   0.24
Equity per share, €          22.04 21.21 21.66  22.20 22.42 21.59 22.21  22.43

Segment information

Net sales by segment                 1-12/ 1-12/ Change, 10-12/ 10-12/ Change,
(€ million)                           2012  2011       %   2012   2011       %
Food trade total                     4,311 4,182     3.1  1,132  1,108     2.2
- of which intersegment trade          172   168     2.3     43     44    -1.7
Home and speciality goods trade,
Finland                              1,557 1,541     1.0    474    490    -3.3
Home and speciality goods trade,
other countries*                        45    23    95.7     13     11    15.5
Home and speciality goods trade
total                                1,603 1,564     2.5    487    501    -2.8
- of which intersegment trade           18    20    -8.3      6      7    -9.3
Building and home improvement trade,
Finland                              1,229 1,233    -0.3    273    297    -8.1
Building and home improvement trade,
other countries*                     1,598 1,483     7.8    385    360     6.8
Building and home improvement trade
total                                2,827 2,716     4.1    657    657     0.1
- of which intersegment trade            0    12   -96.8      0      3    (..)
Car and machinery trade, Finland       998 1,064    -6.2    207    247   -16.0
Car and machinery trade, other
countries*                             116   110     4.7     20     16    19.6
Car and machinery trade
total                                1,114 1,174    -5.1    227    263   -13.7
- of which intersegment trade            1     1    -3.7      0      0    72.1
Common operations and
eliminations                          -169  -176    -3.9    -45    -48    -6.8
Finland total                        7,924 7,844     1.0  2,038  2,094    -2.6
Other countries total*               1,762 1,616     9.0    420    388     8.4
Group total                          9,686 9,460     2.4  2,459  2,481    -0.9

* Net sales in countries other than Finland.
(..) Change over 100%

Operating profit by segment (€         1-12/ 1-12/ Change 10-12/ 10-12/ Change
million)                                2012  2011          2012   2011
Food trade                             171.1 173.7   -2.6   45.0   40.0    5.0
Home and speciality goods trade          0.3  37.0  -36.7   12.9   32.9  -20.1
Building and home improvement trade     11.9  26.3  -14.4  -10.8   -4.5   -6.3
Car and machinery trade                 42.1  51.9   -9.8    4.7    7.0   -2.3
Common operations and eliminations      -8.8  -8.3    0.5    0.9   -2.6    3.5
Group total                            216.7 280.6  -63.9   52.7   72.8  -20.1

Operating profit excl.              1-12/ 1-12/ Change 10-12/ 10-12/ Change
non-recurring items                  2012  2011          2012   2011
by segment (€ million)
Food trade                          168.4 172.2   -3.8   45.0   38.6    6.4
Home and speciality goods trade      19.8  36.6  -16.8   32.4   32.9   -0.6
Building and home improvement trade  13.6  26.6  -13.0  -10.8   -4.4   -6.3
Car and machinery trade              42.1  51.8   -9.7    4.7    7.0   -2.2
Common operations and eliminations   -9.3  -8.3   -0.9    0.5   -2.6    3.1
Group total                         234.7 278.9  -44.2   71.8   71.5    0.3

Operating margin
excl. non-recurring            1-12/ 1-12/            10-12/ 10-12/
items by segment                2012  2011 Change, pp   2012   2011 Change, pp
Food trade                       3.9   4.1       -0.2    4.0    3.5        0.5
Home and speciality goods
trade                            1.2   2.3       -1.1    6.7    6.6        0.1
Building and home improvement
trade                            0.5   1.0       -0.5   -1.6   -0.7       -1.0
Car and machinery trade          3.8   4.4       -0.6    2.1    2.6       -0.6
Group total                      2.4   2.9       -0.5    2.9    2.9        0.0

Capital employed by                 1-12/ 1-12/ Change 10-12/ 10-12/ Change
segment, cumulative                  2012  2011          2012   2011
average (€ million)
Food trade                            758   601    157    810    661    149
Home and speciality goods trade       512   437     75    526    472     54
Building and home improvement trade   758   696     62    744    709     35
Car and machinery trade               187   158     30    184    184      0
Common operations and eliminations    321   236     85    324    256     68
Group total                         2,536 2,129    408  2,588  2,282    306

Return on capital
employed excl. non-            1-12/ 1-12/            10-12/ 10-12/
recurring items by segment, %   2012  2011 Change, pp   2012   2011 Change, pp
Food trade                      22.2  28.6       -6.4   22.2   23.4       -1.2
Home and speciality goods
trade                            3.9   8.4       -4.5   24.6   27.9       -3.3
Building and home improvement
trade                            1.8   3.8       -2.0   -5.8   -2.5       -3.3
Car and machinery trade         22.5  32.8      -10.4   10.3   15.2       -4.9
Group total                      9.3  13.1       -3.8   11.1   12.5       -1.4

Capital expenditure                 1-12/ 1-12/ Change 10-12/ 10-12/ Change
by segment (€ million)               2012  2011          2012   2011
Food trade                            200   221    -21     43     62    -19
Home and speciality goods trade        61    62     -1     13     11      2
Building and home improvement trade    63   110    -47     21     21      0
Car and machinery trade                27    30     -3      3      9     -6
Common operations and eliminations     28     2     25     23      1     22
Group total                           378   425    -47    103    105     -1

Segment information by quarter

Net sales by segment         1-3/  4-6/  7-9/ 10-12/  1-3/  4-6/  7-9/ 10-12/
(€ million)                  2011  2011  2011  2011   2012  2012  2012   2012
Food trade                    948 1,077 1,049  1,108 1,010 1,091 1,078  1,132
Home and speciality goods
trade                         348   339   376    501   369   352   395    487
Building and home
improvement trade             570   757   731    657   629   782   759    657
Car and machinery trade       279   342   290    263   353   274   259    227
Common operations and
eliminations                  -42   -43   -42    -48   -42   -41   -41    -45
Group total                 2,103 2,472 2,404  2,481 2,318 2,460 2,449  2,459

Operating profit by segment (€    1-3/ 4-6/ 7-9/ 10-12/  1-3/ 4-6/ 7-9/ 10-12/
million)                          2011 2011 2011   2011  2012 2012 2012   2012
Food trade                        42.1 45.9 45.7   40.0  37.6 38.9 49.6   45.0
Home and speciality goods trade   -7.4  2.8  8.7   32.9 -12.9 -0.6  0.9   12.9
Building and home improvement
trade                             -9.1 18.8 21.0   -4.5  -9.0 13.6 18.0  -10.8
Car and machinery trade           12.2 19.7 13.0    7.0  15.6 10.3 11.5    4.7
Common operations and
eliminations                      -2.2 -3.3 -0.2   -2.6  -5.1 -3.2 -1.4    0.9
Group total                       35.7 83.9 88.2   72.8  26.3 59.0 78.6   52.7

Operating profit excl.
non-recurring items by segment   1-3/ 4-6/ 7-9/ 10-12/  1-3/ 4-6/ 7-9/ 10-12/
(€ million)                      2011 2011 2011   2011  2012 2012 2012   2012
Food trade                       41.4 45.8 46.4   38.6  34.9 38.9 49.6   45.0
Home and speciality goods trade  -7.4  2.4  8.7   32.9 -12.9 -0.6  0.9   32.4
Building and home improvement
trade                            -9.1 18.8 21.3   -4.4  -9.0 15.3 18.0  -10.8
Car and machinery trade          12.2 19.6 13.0    7.0  15.6 10.3 11.5    4.7
Common operations and
eliminations                     -2.2 -3.3 -0.2   -2.6  -5.1 -3.2 -1.4    0.5
Group total                      34.9 83.3 89.2   71.5  23.6 60.7 78.6   71.8

Operating margin
excl. non-recurring                1-3/ 4-6/ 7-9/ 10-12/ 1-3/ 4-6/ 7-9/ 10-12/
items by segment                   2011 2011 2011   2011 2012 2012 2012   2012
Food trade                          4.4  4.3  4.4    3.5  3.5  3.6  4.6    4.0
Home and speciality goods trade    -2.1  0.7  2.3    6.6 -3.5 -0.2  0.2    6.7
Building and home improvement
trade                              -1.6  2.5  2.9   -0.7 -1.4  2.0  2.4   -1.6
Car and machinery trade             4.4  5.7  4.5    2.6  4.4  3.8  4.4    2.1
Group total                         1.7  3.4  3.7    2.9  1.0  2.5  3.2    2.9

Personnel, average and at 31 Dec.

Personnel average by                1-12/2012 1-12/2011 Change
segment
Food trade                              2,794     2,706     88
Home and speciality goods trade         6,139     5,754    385
Building and home improvement trade     9,105     8,874    231
Car and machinery trade                 1,254     1,206     48
Common operations                         450       420     29
Group total                            19,741    18,960    781
Personnel at 31.12.*                     2012      2011 Change
by segment
Food trade                              3,114     2,984    130
Home and speciality goods trade         8,950     8,765    185
Building and home improvement trade    10,204     9,895    309
Car and machinery trade                 1,259     1,250      9
Common operations                         504       481     23
Group total                            24,031    23,375    656

* total number incl. part-time employees

Group's commitments (€ million)
                                              31.12.2012 31.12.2011  Change, %
Own commitments                                      176        182       -3.1
For associates                                        65                     -
For others                                            10          8       21.8
Lease liabilities for machinery and equipment         26         26        0.1
Lease liabilities for real estate                  2,302      2,303       -0.0
Liabilities arising from derivative
instruments
                                                                    Fair value
Values of underlying instruments at 31 Dec.   31.12.2012 31.12.2011 31.12.2012
Interest rate derivatives
 Interest rate swaps                               203        208       0.75
Currency derivatives
 Forward and future contracts                      245        358      -3.34
 Option agreements                                  11          -       0.03
 Currency swaps                                    100        100      -9.47
Commodity derivatives
 Electricity derivatives                            41         32      -3.63

Calculation of performance indicators

                               Operating profit x 100 / (Non-current assets +
Return on capital employed*, % Inventories + Receivables + Other current
                               assets - Non-interest-bearing liabilities) on
                               average for the reporting period
                               Operating profit excl. non-recurring items x
Return on capital employed     100 / (Non-current assets + Inventories +
excl. non- recurring items*, % Receivables + Other current assets -
                               Non-interest-bearing liabilities) on average
                               for the reporting period
Return on equity*, %           (Profit/loss before tax - income tax) x 100 /
                               Shareholders' equity
                               (Profit/loss adjusted for non-recurring items
Return on equity excl.         before tax - income tax adjusted for the tax
non-recurring items*, %        effect of non-recurring items) x 100 /
                               Shareholders' equity
Equity ratio, %                Shareholders' equity x 100 /
                               (Balance sheet total - prepayments received)
                               (Profit/loss - non-controlling interests) /
Earnings/share, diluted        Average number of shares adjusted for the
                               dilutive effect of options
Earnings/share, basic          (Profit/loss - non-controlling interests) /
                               Average number of shares
Earnings/share excl.           (Profit/loss adjusted for non-recurring items -
non-recurring items,           non-controlling interests) / Average number of
basic                          shares
                               Equity attributable to equity holders of the
Equity/share                   parent /
                               Basic number of shares at the balance sheet
                               date
Gearing, %                     Interest-bearing net liabilities x 100 /
                               Shareholders' equity
Interest-bearing net debt      Interest-bearing liabilities - money market
                               investments - cash and cash equivalents

* Indicators for return on capital have been annualised.

K-Group's retail and B2B sales, VAT 0% (preliminary data):

                                         1.1.-31.12.2012    1.10.-31.12.2012
K-Group's retail and                   € million Change, % € million Change, %
B2B sales
K-Group's food trade
K-food stores                              4,738       3.4     1,230       1.9
Kespro                                       779       6.4       201       8.0
Food trade total                           5,517       3.8     1,431       2.7
K-Group's home and
speciality goods trade
Home and speciality goods stores,
Finland                                    1,705       1.9       512      -0.6
Home and speciality goods stores,
other countries                               45      94.8        13      15.0
Home and speciality
goods trade total                          1,750       3.1       524      -0.3
K-Group's building and home
improvement trade
K-rauta and Rautia                         1,073       0.0       246      -4.2
Rautakesko B2B Service                       209      -7.5        48     -23.2
K-maatalous                                  463      11.1       133      15.0
Finland total                              1,746       1.7       427      -1.9
Building and home improvement stores,
other Nordic countries                     1,203       3.9       293      -1.8
Building and home improvement stores,
Baltic countries                             383       5.4       102       5.3
Building and home improvement stores,
other countries                              370      16.7        93      27.8
Building and home improvement trade
total                                      3,701       4.1       915       1.3
K-Group's car and
machinery trade
VV-Autotalot                                 412      -2.4        91     -15.2
VV-Auto, import                              396     -11.4        80     -20.9
Konekesko, Finland                           210      -3.2        40     -10.5
Finland total                              1,017      -6.3       211     -16.7
Konekesko, other countries                   120       5.5        19      15.5
Car and machinery trade
total                                      1,138      -5.2       230     -14.7
Finland total                              9,982       2,0     2,577      -0.7
Other countries total                      2,125       7.6       523       5.5
Retail and B2B sales
total                                     12,107       2.9     3,100       0.3

Kesko_financial_statements_2012

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Source: Kesko Oyj via Thomson Reuters ONE
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