I. Company

Despite the unfavorable financial market conditions of the last months YALCO - CONSTANTINOU S.A managed to largely maintain its financial results and significantly reduce the losses of the first quarter of 2009. The downtick in sales volume was bounded to 10.9% versus 18.7% in the first quarter 2009. In particular, the decrease in sales during the second quarter of 2009 was limited to 4.3%, while further restriction of losses in sales is expected in in July as well as in August 2009.

The sales improvement combined with maintenance of the gross profit margin and the restraint of operating expenses propelled the Company into pre tax profitability for the first half 2009 at an amount of Euro904 th. compared to Euro228 th. losses in the first quarter 2009. The after tax profit amounted to Euro653 th. and Euro228 th. losses, respectively.

The Company?s performance level continues to show encouraging signs for the prospective months with sales increase, restraint of operating expenses and continued improvement in the operating results. The implementation of the Companys ongoing restructuring program, initiated during the last quarter of 2008, has started to show its results on the Company?s financials. Working capital restrictions have contributed significantly in the continuous improvement of the companys cash flows, while further improvement is expected by the pay back of the amount of the approved subsidy for the construction of the new 12.000 sq. meters warehouse located at Inofyta area.

II. Group

Consolidated sales of the Group appear to have decreased by 17.5%, mainly due to loss of sales of the affiliated air conditioning Company Excel, but also due to the unfavorable financial market conditions Company?s subsidiaries face in Romania and mainly in Hungary.

The aforementioned loss of sales in combination with the required expenses and investments for the implementation of the restructuring and development project of its retail sector, through its subsidiary Omnishop, resulted to Group pre tax losses of Euro470 th. decreased by Euro903 th. compared to the first quarter 2009. After tax results of the Group amounted to Euro756 th. losses for the first half 2009 decreased by Euro636 th.

Partial reversion of the unfavorable financial market conditions and losses restraint is expected to take place in Hungary (further interest rates reduction is already being announced). The fulfilment of substantive co-operations in Romania is expected to contribute to a significant increase of forecasted sales and financial results improvement.

The implementation of the restructuring and retail development project is consistently continued through OMNISHOP S.A., the effects of which are expected to become apparent in the last quarter of the current year and the beginning of the following year, given that all liabilities of the past will have been arranged.

YALCO Group, in todays severe financial environment, strengthens its leading position in the sector, while it continues investing in the development of its retail sector aiming at long term sustainability of improved operations and positive financial results.

THE MANAGEMENT


27/8/2009