RAISIO PLC’S FINANCIAL REVIEW 2006

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Raisio plc Stock Exchange Release 12 February 2007 at 11.00 a.m. Finnish time

RAISIO PLC’S FINANCIAL REVIEW 2006

RAISIO’S OPERATING RESULT DEEP IN THE RED

· Turnover from continuing operations increased slightly in
  2006, amounting to EUR 436.3 million (2005: EUR 434.6 million).
· Operating result from continuing operations, excluding one-
  off items, amounted to EUR -6.0 million (2005: EUR 9.1 million).
  Operating result as reported in the financial statements amounted
  to EUR -38.5 million (EUR -10.9 million).
· Earnings per share (EPS) from continuing operations,
  excluding one-off items, was EUR -0.03 (EUR 0.05). Reported EPS
  was EUR -0.28 (EUR -0.04). The Board of Directors proposes a
  dividend of EUR 0.03 per share.
· Raisio’s main target in 2007 is to improve profitability.
  Measures to streamline business operations have also been adopted.
· Operating result for 2007, excluding one-off items, is
  expected to improve and be clearly profitable thanks to the
  implemented enhancing and rationalisation measures and structural
  policies.

Figures for the comparison period are given in brackets.

Key figures, result from continuing operations
                  10-12/  10-12/   7-9/  4-6/   1-3/   2006   2005
                    2006    2005   2006  2006   2006
Turnover,
EUR million        107.8   112.9  113.8 115.3   99.3  436.3  434.6
Operating result,
EUR million*        -6.3    -1.7    2.1  -0.3   -1.5   -6.0    9.1
  % of turnover*    -5.8    -1.5    1.9  -0.3   -1.5   -1.4    2.1
Result before taxes,
EUR million*        -5.6    -1.7    2.3   0.1   -0.9   -4.2   10.9
Earnings per share,
EUR*               -0.03    0.00   0.01  0.00  -0.01  -0.03   0.05
* excluding one-off items

Key figures, balance sheet, continuing operations
                    31.12.06   30.9.06  30.6.06 31.3.06   31.12.05
Return on 
investment, %	       -12.2       1.6      1.0    -0.5       -1.3
Equity ratio, %         75.0      77.9     79.5    76.9       76.8
Gearing, %             -19.1     -21.6    -14.7   -19.7      -25.0
Equity per share, EUR   1.73      2.02     1.99    1.99       2.06

Matti Rihko, Chief Executive Officer

“A year of many changes in Raisio, was concluded with efforts to
improve profitability. Significant changes also took place in
senior management and the Board of Directors in 2006.

Raisio’s Food Division’s operations have been scattered, which has
made it difficult to manage performance. Despite rationalisation
measures, the Food Division's result was deeply unprofitable as
well as the result of the Diagnostics Division. Exceptions to
these are the Feed & Malt and Ingredients Divisions, which are
clearly structured and have performed well.

Raisio’s main target for 2007 is to improve profitability by
streamlining, focusing and enhancing operations.”

FOURTH QUARTER

Raisio’s fourth-quarter turnover in 2006 was down on the
comparison period, totalling EUR 107.8 million (EUR 112.9
million). Turnover from the Food Division was EUR 53.6 million
(EUR 55.8 million), Feed & Malt EUR 46.7 million (EUR 47.2
million), Ingredients EUR 10.1 million (EUR 12.9 million) and
Diagnostics EUR 2.4 million (EUR 2.3 million).

Turnover for business operations, EUR million

                  10-12/  10-12/   7-9/  4-6/   1-3/   2006   2005
                    2006    2005   2006  2006   2006

Food                53.6    55.8   53.2  54.3   50.7  211.8  210.2
  Margarines and
soy-oat products    29.2    31.9   29.9  30.6   28.8  118.6  117.9
  Milling products  20.8    20.7   19.7  18.0   19.6   78.1   77.0
  Potato products    3.6     4.0    3.7   4.9    3.4   15.6   18.5
  Other                -       -      -   0.1      -      -      -
  Internal sales    -0.1    -0.7   -0.1   0.7   -1.1   -0.4   -3.1
Feed & Malt         46.7    47.2   50.9  50.3   38.6  186.5  186.2
  Feeds             42.9    40.5   45.6  40.8   36.1  165.3  163.6
  Malt               3.9     6.7    5.3   8.5    2.3   20.0   21.4
  Other              0.1     0.1    0.2   1.2    0.3    1.7    2.0
  Internal sales    -0.1    -0.1   -0.1  -0.1   -0.1   -0.5   -0.8
Ingredients         10.1    12.9   12.6  13.8   13.2   49.7   50.2
Diagnostics          2.4     2.3    2.1   2.3    2.2    9.0    8.8
Other                0.2     0.6    0.2   0.1    0.2    0.6    1.3
Other inter-division-5.0    -5.7   -5.2  -5.5   -5.6  -21.3  -22.2
Total              107.8   112.9  113.8 115.3   99.3  436.3  434.6

Business profitability decreased clearly and considerable write-
downs on fixed assets, goodwill and investments pushed the result
deep into the red. The operating result reported for the fourth
quarter was EUR -40.6 million (EUR -21.6 million), including one-
off expenses of EUR 34.3 million (EUR 19.9 million). The report of
the Board of Directors describe the write-downs and their
background in more detail.

Excluding one-off items, the fourth-quarter operating result
amounted to EUR -6.3 million (EUR -1.7 million). The Food
Division’s losses deepened and ended at EUR -5.5 million (EUR-1.8
million), excluding one-off items. The most significant
performance drops were registered in the soy-oat, milling and
Polish businesses. Raisio’s margarine sales in Sweden also
continued to decrease. The operating result in Ingredients was EUR
1.5 million (EUR 2.7 million), and in Feed & Malt EUR 0.5 million
(EUR 1.2 million) excluding one-off items. The Diagnostics
Division’s operating result, excluding one-off items, amounted to
EUR -0.6 million (EUR -0.9 million). The shortage of domestic
grain raw material still caused price pressures for Raisio.

Research and development expenses in the fourth quarter totalled
EUR 3.0 million (EUR 2.6 million), or 2.8% of turnover.
Investments were EUR 9.6 million (EUR 15.5 million), or 8.9% of
turnover.

The post-tax result reported for the fourth quarter amounted to
EUR -46.6 million (EUR -15.6 million) and, excluding one-off
items, to EUR -5.4 million (EUR 0.5 million).

EVENTS AFTER THE REVIEW PERIOD

In January 2007 Raisio’s Board of Directors decided that the
company would divest its diagnostics business.

According to the resolution made by the Assessment Adjustment
Board of the Tax Office for Major Corporations in November 2006,
the sales profit from the divestment of Raisio’s chemicals
business, totalling some EUR 220 million, are free of tax. In
January 2007, Raisio was requested to submit a rejoinder to the
appeal filed by the tax agent concerning the said resolution.
Raisio’s stand, supported by the expert statements obtained by the
company, remains the same: the sales profit is free of tax.

Raisio stated in February 2007 that the company divests its food
potato business in Vihanti. The transaction is to be completed in
the first half of 2007.

As a result of assessment of foreign investment projects started
in December 2006, Raisio stated in February 2007 that the company
has initiated negotiations on a withdrawal from a currently
planned project concerning the construction of a flake mill in
Burunduk, Russia. The decision is based on a considerable increase
in investment costs, which is expected to result in the project no
longer meeting the original revenue requirements. To cover the
probable risks related to changes to be made to the project
agreements, the company will include a write-down of approximately
EUR 5.8 million in the financial statements for 2006.

RAISIO PLC

Heidi Hirvonen
Communications Manager
tel. +358 2 443 2242 or +358 50 567 3060

Further information:
Matti Rihko, CEO, tel. +358 400 830 727
Jyrki Paappa, Chief Financial Officer, tel. +358 50 556 6512

A press and analyst event will be organised on Monday, 12 February
2007, at 3:00 p.m. Finnish time in the Helsinki WTC, at
Aleksanterinkatu 17, Helsinki.

A teleconference in English will be held on 12 February 2007 at
4:30 p.m. Finnish time, tel. +358 (0)9 8248 2010, Pin code 0989.

Raisio plc’s annual report will be published week 11, and the
Annual General Meeting will be held on Friday, 30 March 2007. The
interim report for January–March will be published on 3 May 2007,
for January–June on 2 August 2007 and for January–September on 30
October 2007.

The Financial Review has not been audited.


REPORT OF THE BOARD OF DIRECTORS 2006

Raisio’s vision is to be a forerunner and specialist in plant-
based nutrition with leading brands. The Group’s priorities are
profitability, focusing, internationalisation and growth. The home
market in foods consists of Finland and the Baltic Sea region,
while in feeds and malt it includes Finland, Russia and the Baltic
countries. Functional ingredients have global markets.

Year 2006 was characterised by slight growth in turnover and a
steep downturn in profitability, despite the enhancing measures
adopted in the company. Turnover decreased in all other operations
except the feed, milling and diagnostics businesses. Raisio’s most
important investment decision in 2006 was to build a feed plant to
Ylivieska. After taking the new plant into use the production will
be closed down in Oulu. The joint venture of Raisio and Lännen
Tehtaat, aiming to initiate production in north-western Russia,
fell through due to the vendor withdrawing from the deal. Raisio
will continue to study different alternatives to establish feed
business in Russia. Raisio strengthened its market position in the
Finnish retail trade, but its market position weakened, especially
in Sweden and Poland. The shortage of domestic grain raw material
caused price pressures for Raisio.

A strong balance sheet, good products and well-known brands
provide a good ground to develop Raisio as a forerunner and
specialist in plant-based nutrition.

TURNOVER

The Group’s turnover from continuing operations in 2006 was EUR
436.3 million (EUR 434.6 million). Turnover increased in the Food,
Diagnostics and Feed & Malt Divisions, while the Ingredients
Division fell short of the comparison period.

Turnover from outside Finland represented 38.5% (37.3%) of the
total, or EUR 168.1 million (EUR 162.0 million).

RESULT

The Group’s operating result from continuing operations, excluding
one-off items, amounted to EUR -6.0 million (EUR 9.1 million). The
Food Division’s operating result, excluding one-off items, was
deep in the red. The operating results of both the Ingredients and
Feed & Malt Divisions were down on the comparison period. The
Diagnostics Division remained in the red. Research and development
expenses increased. Other operations were burdened, for example,
by one-off items resulting from changes in management, as well as
expenses of external specialists.

Depreciation, allocated to operations in the income statement,
totalled EUR 22.5 million (EUR 24.5 million), excluding the one-
off depreciation generated by write-downs.

The Group’s result from continuing operations before taxes,
excluding one-off items, totalled EUR -4.2 million (EUR 10.9
million), while earnings per share amounted to EUR -0.03 (EUR
0.05).

The reported result does not lend itself well to comparisons due
to the considerable one-off items in the financial statements for
both 2005 and 2006. The operating result from continuing
operations in the review period was EUR -38.5 (EUR -10.9 million)
and cash flow from business operations was EUR 15.1 million (EUR
5.6 million). The Group’s net financial items, excluding one-off
items, totalled EUR 2.2 million (EUR 2.7 million), and EUR -3.1
million (EUR 4.4 million) including one-off items. The associates’
performance was strained by depreciation of goodwill totalling EUR
2.2 million.

Reported result after taxes for the period from continuing
operations totalled EUR -44.7 million (EUR -5.4 million), while
earnings per share amounted to EUR -0.28 (EUR -0.04). The period’s
taxes were EUR -0.5 million. No significant tax assets are
recognised for write-downs. Return on investment amounted to
-12.2% (-1.3%).

ONE-OFF ITEMS IN THE FINANCIAL STATEMENTS

Raisio’s balance sheet items have been measured in compliance with
the IFRS, using updated business plans and forecasts based on
them. The measurements resulted in write-downs totalling EUR 31.8
million of which EUR 19.4 million involved tangible assets and EUR
11.3 million goodwill. The most significant write-downs concerned
the goodwill of the Diagnostics business and margarine businesses
in Finland, Sweden and Russia, as well as the machinery and
equipment of the Finnish and Russian margarine plants, the soy-oat
plant in Turku and the pure oats plant in Kokemäki. Write-downs
resulted from poor business profitability and weakened future
forecasts with the exception that in soy-oat products’ market is
expected to grow.

As a result of assessment of foreign investment projects started
in December 2006, Raisio stated in February 2007 that the company
has initiated negotiations on a withdrawal from a currently
planned project concerning the construction of a flake mill in
Burunduk, Russia. To cover the probable risks related to changes
to be made to the project agreements, Raisio included a write-down
of EUR 5.8 million in the financial statements for 2006. The write-
down is based on a considerable increase in investment costs,
which is expected to result in the project no longer meeting the
original revenue requirements.

The financial result includes one-off items consisting of a
partial composition arrangement amounting to EUR 4.3 million
concerning interest-bearing receivables related to the previously
ceased sterol project, as well as EUR 1.0 million in write-downs
concerning a stock investment and loan receivable related to the
Diagnostics business.

The write-downs were split among the divisions as follows: Food
EUR 23.9 million, Feed & Malt EUR 1.1 million, Diagnostics EUR 5.8
million.

In addition to these one-off expense items, Raisio recognised a
one-off income item of EUR 1.8 million resulting from the
contractual lease transfer of the plot that Raisio’s feed plant in
Oulu is currently located on. A one-off income item of EUR 3.6
million was also recognised in discontinued operations from the
compensation related to Raisio’s divested Chemicals business.

ONE-OFF ITEMS (EUR million)
                                               2006           2005
CONTINUING OPERATIONS:
Food
  Write-downs                                 -21.7           -7.5
  Withdrawal from the investment project       -5.8              -
Feed & Malt
  Write-downs                                  -1.1           -8.4
  One-off income item                           1.8
Ingredients                                       -              -
Diagnostics
  Write-downs                                  -5.8           -5.1
Other operations                                  -            1.0
Impact on the operating result
of continuing operations                      -32.5          -19.9
Performance of associates                      -2.2              -
Financial items                                -5.3            1.7
Impact of one-off items on the result
from continuing operations before taxes       -40.0          -18.2

INVESTMENTS

The Group’s gross investments in 2006 totalled EUR 30.3 million
(EUR 49.3 million), or 7.0% (11.3%) of turnover. Gross investments
in the Food Division were EUR 16.2 million (EUR 31.2 million), in
Feed & Malt EUR 5.5 million (EUR 5.0 million), Ingredients EUR 4.3
million (EUR 5.3 million), Diagnostics EUR 1.5 million (EUR 1.1
million) and other operations EUR 3.2 million (EUR 10.3 million).

BALANCE SHEET AND FINANCIAL POSITION

Raisio’s balance sheet total was EUR 387.4 million (EUR 452.5
million) and shareholders’ equity totalled EUR 290.4 million (EUR
347.3 million).

The Group’s interest-bearing debt at the end of the financial
period was EUR 23.2 million (EUR 36.1 million). The net interest-
bearing debt totalled EUR -55.6 million (EUR -86.6 million). The
equity ratio at the end of the year was 75.0% (76.8%), and the
gearing ratio -19.1% (-25.0 %).

Working capital increased to EUR 96.7 million (EUR 86.6 million)
due to an increase in inventory volumes.

DIVISIONS

Food

The turnover of Raisio’s Food Division was up 0.8% on the previous
year, amounting to EUR 211.8 million (EUR 210.2 million). Turnover
increased in the milling business and in Russia. Raisio’s
margarine and potato sales continued to decrease in Finland. The
same was true of margarine sales in Sweden and Poland.

The plant for soy and oat-based fresh products came on line in
Turku in January. The sales of GoGreen products did not reach
targets outside the Nordic countries in the first year, but the
segment’s sales in Finland and Europe are growing faster than
sales in retail trade, at an approximate annual rate of 20%. In
retail products, Raisio increased its market share, especially in
yellow fats, flakes and pasta products. Raisio and Finn Cereal
initiated joint production of Provena pure oats products in
Kokemäki.

Operations were rationalised to pave the way for future
profitability. Production at the margarine plant in Finland was
adjusted through staff lay-offs. Business and material flow
control was developed in all operations.

Turnover, EUR million
                                               2006           2005
Food                                          211.8          210.2
  Margarines and soy-oat products             118.6          117.9
  Milling products                             78.1           77.0
  Potato products                              15.6           18.5
  Other                                           -              -
 Internal sales                                -0.4           -3.1

The Food Division’s operating result, excluding one-off items,
amounted to EUR -11.9 million (EUR -0.4 million). It was strained
by a weak steering process and underused production capacity. The
division’s reported operating result amounted to EUR -39.3 million
(EUR -7.9 million), including a total of EUR 27.4 million (EUR 7.5
million) in write-downs. The most significant write-downs
concerned the goodwill of margarine businesses in Finland, Sweden
and Russia as well as the machinery and equipment of the soy-oat
plant, the margarine plants in Finland and Russia, as well as pure
oats production. The write-downs resulted from poor business
profitability. In addition Raisio has initiated negotiations on a
withdrawal from a currently planned project concerning the
construction of a flake mill in Burunduk, Russia.

Raisio was not able to transfer the steep price increase in grain-
and plant-based raw materials to consumer prices in the latter
half of 2006. In Poland Raisio’s market position weakened in
yellow fats, and the commission sales of yoghurt drinks produced
by Raisio’s associate Obory did not meet the targets set for which
reason the commission sales will be ceased during spring 2007.

In November, Raisio and Valio agreed on cooperation related to
nutrition research.

Feed & Malt

The Feed & Malt Division's turnover totalled EUR 186.5 million
(EUR 186.2 million). The feed business accounted for EUR 165.3
million and malt business for EUR 20.0 million. The overall market
for farm feeds experienced a slight decrease in Finland, most of
it taking place in cattle feeds. Fish feed exports to Russia saw
steep growth. Malt markets were still characterised by intense
price competition in the early part of the year. Bankruptcies and
close-downs of malting plants did away with overcapacity in the
field, which had a favourable impact on malt prices.

Turnover, EUR million
                                               2006           2005
Feed and malt                                 186.5          186.2
  Feeds                                       165.3          163.6
  Malt                                         20.0           21.4
  Other                                         1.7            2.0
  Internal sales                               -0.5           -0.8

Operating result, excluding one-off items, amounted to EUR 5.6
million (EUR 8.9 million). The reported operating result was EUR
6.3 million (EUR 0.5 million), including a write-down of EUR 1.1
million (EUR 8.4 million) and a one-off income item of EUR 1.8
million.

ZAO Scandic Feed, the 50/50 owned joint venture of Raisio and
Lännen Tehtaat, was not able to carry through its plans to start
production in Russia as the owner of ZAO Tosno Feed Factory
withdrew from the deal.

Raisio invested in a new feed plant in Ylivieska. The construction
work of the new plant in a key milk production area has started
and the factory is expected to be completed in 2008.

Finnish grain crops fell short of the previous year’s volumes,
which raised the price of grain raw material at the end of the
year. Raisio was unable to fully transfer the rise in expenses to
the prices of the end products. A weak malt barley crop
contributed to an increase in malt prices throughout the EU
region, underscoring the importance of the availability of high-
quality raw material up to the next crop season.

Ingredients

The Ingredients Division's turnover decreased to EUR 49.7 million
(EUR 50.2 million). While the volume of ingredients sales
increased, the sales prices in some geographic areas were lower
than those in the comparison period.

Turnover, EUR million
                                               2006           2005
Ingredients                                    49.7           50.2

Operating result dropped to EUR 7.8 million (EUR 9.7 million). The
large input of resources into jointly strengthening the Benecol
brand with partners led to weaker profitability but will
strengthen the brand’s position in the future. Additional capacity
was completed in Raisio and rationalisation measures were carried
out at the Charleston plant.

Activities focused on ensuring future growth in Europe, South
America and especially in Asia, where processes for obtaining
sales permits are underway. The market for sterol-based
ingredients is growing over 10% annually.

Raisio’s partner, Ülker, launched Benecol products in Turkey.
Raisio also began a trial marketing of Benecol margarine in
Russia. The Frost & Sullivan research institute granted Benecol
the ”Brand Strategy Leadership Award” for high-quality development
work of the Benecol brand.

Diagnostics

The Diagnostics Division's turnover increased, amounting to EUR
9.0 million (EUR 8.8 million).

Turnover, EUR million
                                               2006           2005
Diagnostics                                     9.0            8.8

The operating result of the Diagnostics Division, excluding one-
off items, amounted to EUR -2.1 million (EUR -2.2 million). The
reported operating result was EUR -7.9 million (EUR -7.3 million),
including a goodwill write-down of EUR 5.8 million (EUR 5.1
million). As a separate unit and with current size Diagnostics has
limited preconditions for profitable operation which constituted
the reason for write-down.

The overall market for food diagnostics is growing by nearly 10%
annually. Considerably faster growth has been recorded in the
focal areas of food diagnostics: the markets for modern DNA and
rapid testing. Raisio’s speciality has been innovative food
diagnostics methods that provide added value to customers. The
first of these were launched at the end of 2006.

RESEARCH AND DEVELOPMENT

Research and development is one of Raisio’s strategic priorities.
In 2006, the Group focused on increasing the share of value-added
products in its food range and on developing new, competitive
products and feeding solutions for feed customers.

Raisio decentralised research and development last year, making
R&D activities part of other businesses. The new operating model
meets the needs of business areas better than before and offers
cost savings. The company gave up its research centre in Viikki,
and all research and development activities are now centrally
located in Raisio.

The Group’s research and development expenses in 2006 totalled EUR
11.2 million (EUR 10.3 million), or 2.6% (2.4%) of turnover.

Research and development expenses in the Food Division were EUR
5.6 million (EUR 2.8 million), in Feed & Malt EUR 1.5 million (EUR
1.0 million), in Ingredients EUR 2.9 million (EUR 2.1 million) and
in Diagnostics EUR 1.1 million (EUR 1.2 million). The Group’s
strategic R&D, the expenses of which were recorded for other
operations, amounted to EUR 0.1 million (EUR 3.2 million).

CORPORATE RESPONSIBILITY

Raisio is committed to taking responsibility for its operating
environment. The target is for operations to stand on an
ecologically, socially and financially solid basis now and in the
future. Raisio’s Corporate Responsibility Report will be published
in conjunction with the Annual Report in March.

Raisio has no financial environmental risks recorded in the
financial statements.

GOVERNANCE, MANAGEMENT AND PERSONNEL

In 2006, the Board of Directors had seven members until 29
November 2006 when the Supervisory Board dropped the number to
five and renewed the composition for the remainder of 2006, as
well as for 2007. The Board of Directors consists of Simo
Palokangas (Chairman), Anssi Aapola, Erkki Haavisto, Satu
Lähteenmäki and Michael Ramm-Schmidt. The Board members are
independent of the company and of significant shareholders.

The Chairman of Raisio’s Supervisory Board is Juha Saura and its
Vice Chairman is Holger Falck.

Rabbe Klemets acted as Raisio plc’s Chief Executive Officer until
November 2006. Matti Rihko, who took up the post as President of
the Ingredients Division in August 2006 was appointed CEO of the
Group as of 29 November 2006. He also continues to be in charge of
the Ingredients Division. No deputy CEO was appointed.

Denis Mattsson was appointed President of Raisio’s Food Division
and member of the Executive Committee in May. Similarly, Leif
Liedes, President of the Feed & Malt Division, was appointed
member of the Executive Committee in May.

On the Executive Committee, three members left Raisio: Olavi
Kuusela, Executive Vice President and Deputy CEO, in April 2006;
Jukka Lavi, Executive Vice President, in September 2006; and Taru
Narvanmaa, Executive Vice President, in December 2006.

On 31 December 2006, Raisio had 1,330 employees (1,396 in 2005 and
1,412 in 2004). Employees working abroad accounted for 34.5%
(33.0%) of the personnel at the end of the year. The headcount was
reduced by the streamlining programmes in the Food Division and
service functions. At the end of the year, the Food Division had
825 employees, the Feed & Malt Division 285 employees, the
Ingredients Division 72 employees, the Diagnostics Division 69
employees and Group administration 79 employees.

The wages and fees in 2006 totalled EUR 48.2 million (EUR 46.5
million in 2005 and EUR 48.2 million in 2004).

Personnel matters are reported in greater detail in Raisio’s
Corporate Responsibility Report.

SHARES AND SHAREHOLDERS

The number of Raisio V shares traded in 2006 totalled 64.3 million
(109.6 million), which equals some 49% of the total volume. The
value of share trading was EUR 121.1 million (EUR 250.4 million).
The closing price of free shares on 29 December 2006 was EUR 1.79,
while the average price over the year was EUR 1.88 (EUR 2.28). The
price of the series V shares decreased by 21% from the beginning
of the year.

A total of 1.5 million of Raisio’s restricted shares (1.5 million)
were traded over the year. The value of share trading was EUR 2.8
million (EUR 3.5 million). The closing price of the K shares on 29
December 2006 was EUR 1.80, while the average price over the year
was EUR 1.91 (EUR 2.33). The price of the Series K shares
decreased by 21% from the beginning of the year.

The share capital, including the company shares held by Raisio,
had a market value of EUR 296.0 million at the end of 2006 (EUR
373.9 million).

At the end of the year, Raisio had 40,822 registered shareholders
(42,953 registered shareholders). Approximately 0.5% of the shares
remain outside the book-entry system.

Share repurchases made Raisio the largest owner of the company.

Raisio has no share-based incentive systems at the moment.

A description of the factors that are likely to have a material
effect on a public offer to acquire the shares of the company, as
provided in Chapter 2, section 6b of the Securities Market Act, is
included in the notes to the Financial Statements.

REPURCHASE OF COMPANY SHARES

In August 2005, the Board of Directors initiated share repurchases
based on the authorisation given by the Annual General Meeting.
Share repurchases ended in March 2006 at the expiry of the
authorisation.

Shares were repurchased in order to develop the capital structure
of the company, to fund or implement corporate acquisitions or
other arrangements, or to be otherwise further assigned or
cancelled.

The maximum number of shares the Board was authorised to
repurchase corresponded to 5% of the company’s share capital and
votes. Share repurchasing was carried out at the price determined
in the open market on the Helsinki Stock Exchange and did not
follow the shareholders’ holding ratios.

Repurchases in January–March 2006 accounted for a total of
1,192,500 free shares at an average price of EUR 2.20 and 11,000
restricted shares at an average price of EUR 2.23. The trade price
totalled EUR 2,645,080.

From 10 August 2005 to 29 March 2006, share repurchases accounted
for a total of 4,930,500 free shares at an average price of EUR
2.28 and 41,200 restricted shares at an average price of EUR 2.32.
The number of repurchased free shares accounts for 3.78% of all
free shares and the votes they represent, while the corresponding
percentage for restricted shares is 0.12%. In all, the shares
acquired by the company represent 3.01% of the company’s share
capital and 0.70% of overall votes. The book counter value of
repurchased free shares is EUR 829,251 and that of restricted
shares EUR 6,929, or a total of EUR 836,180. The trade price for
free shares was EUR 11,256,303 and for restricted shares EUR
95,643, or a total of EUR 11,351,946.

Prior to these purchases, the company and its subsidiaries did not
hold Raisio plc’s shares. A share in Raisio or its subsidiary does
not entitle the holder to participate in the Annual General
Meeting.

According to estimates, the share repurchases have not had a
significant impact on the distribution of share holdings or voting
rights in the company. Since the shares were repurchased in the
open market on the Helsinki Stock Exchange with no information
about the vendors, it is impossible to determine the portion that
any shares purchased from insiders, as defined in Section 8:6.2 of
the Companies Act, may represent of the company’s share capital
and voting rights.

The Annual General Meeting held in March 2005 authorised the Board
of Directors to dispose of repurchased shares. This authorisation
was not exercised during its period of validity, which ended on 29
March 2006.

The Annual General Meeting held in spring 2006 granted the Board
of Directors new authorisation to dispose of all of the company
shares held by Raisio, that is, 4,930,500 free shares and 41,200
restricted shares. This authorisation was not exercised in the
review period, and it is valid until the Annual General Meeting of
2007.

DIVIDEND PROPOSAL

The Board of Directors will propose a dividend of EUR 0.03 per
share at the Annual General Meeting on 30 March 2007.

EVENTS AFTER THE REVIEW PERIOD

In January 2007, Raisio’s Board of Directors decided that the
company would divest its Diagnostics business. Raisio has started
a process to find a new owner that can ensure the growth of
Diagnostics business. The aim is to complete the transaction in
the first half of 2007.

According to the resolution made by the Assessment Adjustment
Board of the Tax Office for Major Corporations in November 2006,
the sales profit from the divestment of Raisio Chemicals,
totalling some EUR 220 million, are free of tax. In January 2007,
Raisio was requested to submit a rejoinder to the appeal filed by
the tax agent concerning the said resolution. Raisio’s stand,
supported by the expert statements obtained by the company,
remains the same: the sales profit is free of tax.

Raisio stated in February 2007 that the company divests its food
potato business in Vihanti. The transaction is to be completed in
the first half of 2007.

As a result of assessment of foreign investment projects started
in December 2006, Raisio stated in February 2007 that the company
has initiated negotiations on a withdrawal from a currently
planned project concerning the construction of a flake mill in
Burunduk, Russia. The decision is based on a considerable increase
in investment costs, which is expected to result in the project no
longer meeting the original revenue requirements. To cover the
probable risks related to changes to be made to the project
agreements, the company will include a write-down of approximately
EUR 5.8 million in the financial statements for 2006.

OUTLOOK FOR 2007

Raisio’s main target in 2007 is to improve profitability.
Structural measures to streamline business operations have also
been adopted. These include clarifying the organisation structure,
focusing on clear, measurable targets and enhancing operations.

Competition in the food markets around the Baltic Sea is expected
to increase stiff as centralisation continues in trade. New
bioethanol projects and other changes in the competition
environment will set new challenges for the feed market. The
European malt market is beginning to pick up as overcapacity falls
off. Competition on the European market for functional foods will
increase, and product launches in new market areas will be slowed
down, for example, by the different permit procedures of various
countries. Increased costs of grain raw material and energy put
pressure for price increases. The collective agreements in the
food industry are about to expire and the new agreements under
negotiations are expected to raise salaries in the sector.

Operating result for 2007, excluding one-off items, is expected to
improve and to be clearly profitable thanks to the implemented
streamlining and rationalisation measures and structural policies.
The first-quarter operating result, however, will still be
slightly negative. Turnover is expected to grow slightly compared
to 2006.

Raisio, 12 February 2007

Raisio plc
Board of Directors

INCOME STATEMENT (EUR million)
                                                    2006      2005
CONTINUING OPERATIONS:
Turnover                                           436.3     434.6
Expenses corresponding to products sold           -385.2    -363.4

Gross profit                                        51.1      71.2

Other operating income and expenses, net           -89.5     -82.1
Operating result                                   -38.5     -10.9

Financial income and expenses, net                  -3.1       4.4
Share of result of associated
companies and joint ventures                        -2.7      -0.8

Result before taxes                                -44.2      -7.3
Income tax                                          -0.5       1.9

Result for the period from the
continuing operations                              -44.7      -5.4

DISCONTINUED OPERATIONS:
Result for the period from
discontinued operations                              3.6       0.0

RESULT FOR THE PERIOD                              -41.1      -5.4

Attributable to:
Equity holders of the parent company               -41.7      -6.0
Minority interest                                    0.5       0.6

Earnings per share from the profit
attributable to equity holders
of the parent company (EUR)
Earnings per share from continued
operations (EUR)                                   -0.28     -0.04
Earnings per share from discontinued
operations (EUR)                                    0.02      0.00

ONE-OFF ITEMS (EUR million)
                                                    2006      2005
CONTINUING OPERATIONS:
Food Division
  Write-downs                                      -21.7      -7.5
  Withdrawal from the investment                    -5.8       0.0
Feed & Malt Division
  Write-downs                                       -1.1      -8.4
  Compensation resulting from the
  contractual lease transfer                         1.8       0.0
Diagnostics Division
  Write-downs                                       -5.8      -5.1
Other operations                                     0.0       1.0
Impact on result for the period                    -32.5     -19.9
Financial items                                     -5.3       1.7
Share of result of associated
companies and joint ventures                        -2.2       0.0
Impact on result from the
continuing operations before taxes                 -40.0     -18.2

BALANCE SHEET (EUR million)
                                                31.12.06  31.12.05

Non-current assets
  Intangible assets                                 13.0      13.4
  Goodwill                                           2.6      11.6
  Tangible assets                                  117.7     130.5
  Shares in associated companies
  and joint ventures                                 2.4       4.9
  Financial assets available for sale                1.5       2.2
  Receivables                                        3.1       6.2
  Deferred tax assets                               10.7      12.3
Current assets
  Inventories                                       82.1      73.9
  Accounts receivables and
  other receivables                                 75.4      74.7
  Financial assets at fair value
  through profit or loss                            64.4     117.0
  Cash in hand and at banks                         14.5       5.8
Total assets                                       387.4     452.5

Equity attributable to equity
holders of the parent company
  Share capital                                     27.8      27.8
  Own shares                                       -11.4      -8.7
  Other equity attributable to
  equity holders of the parent company             260.7     312.9
Minority interest                                   13.3      15.3
Deferred tax liabilities                             7.9       8.7
Pension liabilities                                  0.2       0.4
Non-current interest-bearing liabilities             1.4      12.9
Other non-current liabilities                        1.0       0.0
Accounts payable and other liabilities              59.8      60.5
Reserves                                             5.1       0.0
Current interest-bearing liabilities                21.6      22.8
Total equity and liabilities                       387.4     452.5

CHANGES IN GROUP EQUITY (EUR million)

   Sha-  Sha-   Re-  Ot-  Own Trans-  Fair   Re-   To- Mino-   To-
     re    re  ser-  her sha-  lati- value  tai-   tal  rity   tal
    ca-  pre-    ve  re-  res     on   re-   ned         in-
    pi-  mium  fund ser-      diffe-  ser-  ear-         te-
    tal   re-        ves        ren-    ve nings        rest
        serve                    ces

Equity at
1.1.2005
   27.8   2.9  88.6  0.0  0.0   -2.2   0.0 261.0 378.1  14.7 392.8
Effects of
adopting
IAS 32 and IAS
39    -     -     -    -    -      -   0.3  -0.3   0.0     -   0.0
Dividends
paid  -     -     -    -    -      -     - -34.7 -34.7     - -34.7
Changes in
translation
differen-
ces   -     -     -    -    -    3.8     -     -   3.8   0.0   3.8
Repurchase
of own
shares-     -     -    - -8.7      -     -     -  -8.7     -  -8.7
Exchange differences
from receivables
considered to be
net investments
from a foreign
unit  -     -     -    -    -   -0.4     -     -  -0.4     -  -0.4
Tax of
previous
      -     -     -    -    -    0.1     -     -   0.1     -   0.1
Cash flow
hedges
  Transferred to
  income statement
  with taxes
  deducted
      -     -     -    -    -      -  -0.1     -  -0.1     -  -0.1
Investments available
for sale
  Transferred to
  income statement
  with taxes
  deducted
      -     -     -    -    -      -  -0.2     -  -0.2     -  -0.2
Net profit
for review
period-     -     -    -    -      -     -  -6.0  -6.0   0.6  -5.4
Other
changes
      -     -     -    -    -      -     -   0.1   0.1   0.0   0.1
Equity at
31.12.2005
   27.8   2.9  88.6  0.0 -8.7    1.3   0.0 220.1 332.0  15.3 347.3

Equity at
1.1.2006
   27.8   2.9  88.6  0.0 -8.7    1.3   0.0 220.1 332.0  15.3 347.3
Dividend
paid  -     -     -    -    -      -     -  -8.0  -8.0  -2.5 -10.5
Changes in
translation
differen-
ces   -     -     -    -    -   -2.6     -     -  -2.6   0.0  -2.6
Repurchase
of own
shares-     -     -    - -2,6      -     -     -  -2,6     -  -2,6
Exchange differences
from receivables
considered to be
net investments
from a foreign
unit  -     -     -    -    -    0.1     -     -   0.1     -   0.1
Tax of
previous
      -     -     -    -    -    0.0     -     -   0.0     -   0.0
Cash flow
hedges
  Transferred to
  the equity
  with taxes
  deducted
      -     -     -    -    -      -   0.0     -   0.0     -   0.0
  Transferred to
  income statement
  with taxes
  deducted
      -     -     -    -    -      -     -     -   0.0     -   0.0
Net profit
for review
period-     -     -    -    -      -     - -41.7 -41.7   0.5 -41.1
Other
changes
      -     -     -    -    -      -     -   0.0   0.0     -   0.0
Equity at
31.12.2006
   27.8   2.9  88.6  0.0-11.4   -1.2  -0.0 170.4 277.1  13.3 290.4

CASH FLOW STATEMENT (EUR million)
                                                     2006     2005

Cash flow before change
in working capital                                   20.8     34.5
Change in working capital                            -7.3    -27.0
Financial items and taxes                             1.7     -1.9
Cash flow from business operations                   15.1      5.6

Investments                                         -33.7    -48.6
Proceeds from sale of fixed assets                    0.4      8.3
Cash flow from investments                          -33.3    -40.3

Change in non-current loans                         -12.6    -14.0
Change in current loans                               0.8     -0.3
Repurchase of own shares                             -2.6     -8.6
Dividends paid to equity holders
of the parent company                                -8.0    -34.5
Dividends paid to minority interests                 -2.5      0.0
Cash flow from financial operations                 -24.9    -57.4

Adjustment to translation difference                  0.1     -0.3

Change in liquid funds                              -43.0    -92.4

Liquid funds at the beginning
of the period                                       122.9    214.1
Impact of change in market value on
liquid funds                                         -1.0      1.2
Liquid funds at the end of the period                78.8    122.9

TURNOVER BY SEGMENT (EUR million)
                                                     2006     2005

Food                                                211.8    210.2
Feed & Malt                                         186.5    186.2
Ingredients                                          49.7     50.2
Diagnostics                                           9.0      8.8
Other operations                                      0.6      1.3
Interdivisional turnover                            -21.3    -22.2
Total turnover                                      436.3    434.6

OPERATING RESULT BY SEGMENT (EUR million)
                                                     2006     2005

Food                                                -39.3     -7.9
Feed & Malt                                           6.3      0.5
Ingredients                                           7.8      9.7
Diagnostics                                          -7.9     -7.3
Other operations                                     -5.3     -5.8
Eliminations                                          0.0      0.0
Total operating result                              -38.5    -10.9

NET ASSETS BY SEGMENT (EUR million)
                                                 31.12.06 31.12.05

Food                                                 90.7    114.7
Feed & Malt                                          65.3     52.6
Ingredients                                          44.5     46.2
Diagnostics                                           5.3     10.8
Other operations and unallocated items               84.6    123.0
Total net assets                                    290.4    347.3

INVESTMENTS BY SEGMENT (EUR million)
                                                     2006     2005

Food                                                 16.2     31.2
Feed & Malt                                           5.5      5.0
Ingredients                                           4.3      5.3
Diagnostics                                           1.5      1.1
Other operations                                      3.2     10.3
Eliminations                                         -0.2     -3.6
Total investments                                    30.3     49.3

TURNOVER BY MARKET AREA (EUR million)
                                                     2006     2005

Finland                                             268.2    272.5
Poland                                               41.1     36.6
Russia                                               33.4     31.3
Other Europe                                         86.1     86.4
ROW                                                   7.4      7.6
Total                                               436.3    434.6

QUARTERLY PERFORMANCE (EUR million)
               10-12/  7-9/  4-6/   1-3/ 10-12/  7-9/   4-6/  1-3/
                 2006  2006  2006   2006   2005  2005   2005  2005

Turnover by segment
Food             53.6  53.2  54.3   50.7   55.8  52.3   52.1  50.1
Feed & Malt      46.7  50.9  50.3   38.6   47.2  48.9   50.6  39.5
Ingredients      10.1  12.6  13.8   13.2   12.9  12.3   13.8  11.3
Diagnostics       2.4   2.1   2.3    2.2    2.3   2.1    2.4   2.1
Other operations  0.2   0.2   0.1    0.2    0.6   0.3    0.2   0.3
Interdivisional
turnover         -5.0  -5.2  -5.5   -5.6   -5.7  -5.2   -6.1  -5.2
Total turnover  107.8 113.8 115.3   99.3  112.9 110.7  112.9  98.1

Gross profit     -5.3 18.9* 19.3*  18.2*    3.1  22.7   23.7  21.6


Operating result by segment
Food            -33.0  -2.0  -2.4   -1.9   -9.3   0.2    0.4   0.9
Feed & Malt      -0.5   2.7   3.6    0.5   -7.2   3.2    2.8   1.7
Ingredients       1.5   2.2   2.3    1.8    2.7   2.1    2.1   2.7
Diagnostics      -6.4  -0.5  -0.5   -0.5   -6.0  -0.4   -0.4  -0.5
Other operations -2.3  -0.1  -1.5   -1.4   -1.8  -1.5   -2.0  -0.6
Eliminations      0.1  -0.1   0.0    0.0   -0.1   0.2    0.0  -0.1
Total operating
result          -40.6   2.1   1.5   -1.5  -21.6   3.8    2.9   4.1

Share of result of
associated
companies        -2.3  -0.2  -0.1    0.0   -0.5  -0.3    0.0  -0.1
Segment results -42.9   1.9   1.4   -1.5  -22.1   3.5    2.9   4.0

Financial income
and expenses, net-4.6   0.4   0.5    0.6    0.5   2.1    1.0   0.8
Result before taxes-47.52.3   1.9   -0.9  -21.7   5.6    3.9   4.8
Income tax        0.9  -0.9  -0.6    0.0    6.1  -1.5   -1.4  -1.3
Result for the period
from continuing
operations      -46.6   1.4   1.3   -0.9  -15.6   4.1    2.5   3.5

* Figures published in the interim reports for 2006 have been
adjusted as a result of revised expense distribution among
operations.

KEY INDICATORS
                                                 31.12.06 31.12.05

Return on equity, ROE, %                           -14.0*     -1.5
Return on investment, ROI, %                       -12.2*     -1.3

Interest-bearing liabilities
at the end of the period, EURm                       23.2     36.1
Gross investments, EURm                              30.3     49.3
  % of turnover                                       7.0     11.3
Depreciation, EURm                                   22.5     24.5
R & D expenses, EURm                                 11.2     10.3
  % of turnover                                       2.6      2.4
Average personnel                                   1,401    1,414
Equity ratio, %                                      75.0     76.8
Gearing, %                                          -19.1    -25,0

Earnings/share from
continuing operations, EUR**                        -0.28    -0.04
Earnings/share from
discontinued operations, EUR**                       0.02     0.00
Cash flow from operations/share, EUR**               0.09     0.03
Equity/share, EUR**                                  1.73     2.06
Average number of shares during
the period, in 1,000s**
  Free shares                                     125,843  129,694
  Restricted shares                                34,524   34,556
  Total                                           160,367  164,250
Average number of shares at the end
of the period, in 1,000s**
  Free shares                                     125,655  126,848
  Restricted shares                                34,522   34,533
  Total                                           160,177  161,381
Market capitalisation of shares at the end
of the period, EURm**
  Free shares                                       224.9    286.7
  Restricted shares                                  62.1     78.7
  Total                                             287.1    365.4

*Based on continuing operations result
**Number of shares without own shares

CONTINGENT LIABILITIES (EUR million)
                                                 31.12.06 31.12.05
Assets given for security
  For the company
     Mortages on real estate                         16.9     16.9
     Securities pledged                               0.0      0.0
     Corporate mortgages                             34.4     33.8

Contingent off-balance sheet liabilities
  Non-cancellable other leases
     Minimum lease payments                           2.7      2.8
  Contingent liabilities for the Company              1.5      1.5
  Contingent liabilities for associated companies
     Guarantees                                       3.0      0.0
  Contingent liabilities for others
     Guarantees                                       0.0      0.0
  Other liabilities                                   2.8      1.6

DERIVATIVE CONTRACTS (EUR million)
                                                 31.12.06 31.12.05
  Nominal values of derivative contracts
     Raw material futures                             5.4      2.6
     Currency forward contracts                      25.5     34.9

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