SkiStar AB (publ) Year-end report 1 September 2001 – 31 August 2002 Net sales increased to MSEK 897 (807) and income before tax increased by 76% to MSEK 139 (79). Profit per share improved to SEK 10:10 (5:70). The operating margin increased to 21% (16) and return on equity increased to 15% (9). An increased dividend of SEK 6:00 (3:50) per share is proposed. The current situation regarding bookings prior to the start of the winter season is 26% more favourable than it was at this time during the previous year. As per 1 October 2002 Mats Årjes is due to take over as new Managing Director.

www.skistar.com

Year-end Report 1 September 2001 – 31 August 2002

This is SkiStar SkiStar is listed on the Stockholm Stock Exchange’s O List. The Group owns and operates ski facilities in alpine destinations in Sälen, Åre and Vemdalen in Sweden and in Hemsedal in Norway. The company’s market share of ski pass sales is 52% in Sweden, 13% in Norway and 35% in the whole of Scandinavia. The core business is alpine skiing, with the focus on the guests’ skiing experience. Other operations include an accommodation agency, ski school and ski hire facilities. The company’s vision is to create memorable alpine experiences for its clients, as the leading operator of European alpine destinations. SkiStar shall take a leading position within the conceptualisation, integration and development of these types of services. Sales and income SkiStar’s net sales during the financial year amounted to MSEK 897 (807) and profit before tax amounted to MSEK 139 (79). Profit per share improved to SEK 10:10 (5:70). Capital gains from the sale of tenant-owner’s rights and apartments are included in sales in the amount of MSEK 8. During the fourth quarter, operating expenses have been charged with expenses for severance pay for the managing director, in the amount of MSEK 5, and for extra maintenance of property holdings, in the amount of MSEK 6. The increase

in income during the financial year 2001/02 can primarily be attributed to the second and third quarters. During the fourth quarter (June – August), earnings were low, as is expected. The year’s increase in income is a result of the higher inflow of guests and, therefore, a higher occupancy rate at SkiStar’s alpine destinations, an earlier start to the season in Sälen compared with the previous year and profits from efficiency measures achieved through an exchange of experience and savings programs. The weak Swedish krona has also meant that many Swedes chose to take their winter holidays in Sweden. Product development within other branches – first snow-boarding and, most recently, the new easy-to-ride, slalom skis, so-called carving skis – has contributed to an increase in interest in the sport and in the number of skiers. Market developments According to SLAO (Swedish Ski Lift Organisation) sales of ski passes during the 2001/02 season increased by 18% in Sweden, to approximately MSEK 770. Sales of lift passes in Norway increased by 9% to MNOK 600 during the same period, according to the Norwegian Ski Lift Association. The average price increase was 5% in Sweden and 4% in Norway.

ALLOCATION OF SALES, MSEK Sept- Aug 2001/02 2000/01 Down hill skiing/lift Accommodation Ski hire Ski school Sport shops Restaurants Property Other Total

492 121 67 34 34 40 41 68 897

419 117 49 31 30 70 33 58 807

+/-

+/- %

+73 + 4 +18 + 3 + 4 - 30 + 8 +10 +90

+17 + 3 +37 +10 +13 - 43 +24 +17 +11

Operations SkiStar’s alpine destinations Sälen, Åre and Vemdalen were able to open earlier than last year, while Hemsedal had a later start to the season. Still the season commenced somewhat weaker than usual. Sales volumes developed very strongly from Christmas until Easter and new sales records were set over a considerable number of weeks. However, an early spring resulted in an earlier close to the season. The efficiency and savings program, which was initiated during the previous year, has implied that expenses have decreased by MSEK 28 (for comparable units) during 2001/ 02, with the exception of expenses for severance pay, in the amount of MSEK 5, and extra property maintenance in the amount of MSEK 6. The operating margin improved during the financial year to 21% (16) and return on equity increased to 15% (9). SkiStar’s target as regards return on equity has been adjusted upwards by 4 % points to 16%, according to the current interest rate. Sales of lift passes within the Group increased by MSEK 73 (17%) to MSEK 492, of which 11% represented an increase in volume. The market share of sales of lift passes in Sweden remained unchanged, at 52%. In Norway the market share decreased by 1 percentage point to 13%. The occupancy rate in the Group’s own cabins and apartments, and those for whom they act as an agent, amounted to 87% during the period Christmas - l May, an increase of 2 % points compared with the previous year. The number of own cabins or apartments for rental also increased by 8%. Certain structural measures were taken, primarily in Åre and Vemdalen, prior to the financial year 2001/02, including the acquisition of a number of restaurants in Åre and the lease of a hotel in Vemdalen. In addition, five

ski hire businesses and the local TV company, Årevisionen AB in Åre, have been acquired. As per 9 August 2002 it was publicly announced that SkiStar’s Managing Director for the last 15 years, Thorvald Sverdrup, was to leave his position. The board of directors has appointed Mats Årjes, former Director of the Swedish Ski Association, as new Managing Director as per 1 October 2002. Operational areas Sälen increased sales by MSEK 70 to MSEK 437 and income before depreciation improved by MSEK 41 to MSEK 166. Sales of lift passes increased by 24% to MSEK 215. Sälen had a very late start to the 2000/01 season. Sales in Åre increased by MSEK 29 to MSEK 270 and income before depreciation rose by MSEK 14 to MSEK 69. Capital gains from sales of tenant-owner’s rights in the amount of MSEK 9 are included in sales and income. Sales of lift passes increased by 11% to MSEK 139. In June 2002, the International Ski Federation decided that Åre will host the Alpine World Cup in the year 2007. Sales decreased by MSEK 26 in Vemdalen to MSEK 63. In spite of this, income before depreciation increased by MSEK 4 to MSEK 15. The decrease in sales in Vemdalen is entirely attributable to the fact that the hotel and restaurants have been leased during the year. Sales of lift passes increased by 14% to MSEK 47. In Hemsedal sales increased by MSEK 17 to MSEK 127 and income before depreciation increased by MSEK 7 to MSEK 47. Income has been charged with losses in the amount of MSEK 1 in conjunction with the sale of cabins. Sales of lift passes increased by 5% to MNOK 76/MSEK 91. Changes in the

exchange rate between SEK/NOK during the financial year 2001/02 compared with the previous year, have had a positive effect on group income before tax, in the amount of MSEK 2.

1.5 years and the average duration was 5.6 years. In May 2002 the parent company was allowed to reduce the share premium reserve by MSEK 370, to increase non-restricted equity.

Cash flow Resort cash flow, which is defined as income from the operations less costs of the operations, amounted to MSEK 297 (231), during the period. Cash flow from current operations amounted to MSEK 192 (161) and cash flow after investments and financing activities amounted to MSEK 63 (12).

The number of shareholders as per 31 August 2002 was 3,658, which is an increase of 612 (20%) since 31 August 2001.

Investments Investments during the financial year amounted to MSEK 143 (157). Of this amount, MSEK 32 refers to investments in conjunction with the winter season 2002/03. The investments in Åre include systems for snow production, lifts and groundwork for downhill pistes, as well as the acquisition of five ski hire outlets. In Hemsedal these investments relate to children’s lifts and systems for snow production and in Sälen, to the construction of a restaurant. Two part-owned associated companies invested in cabins and apartments in Sälen, with a total of 600 tourist beds, which were completed by the start of the 2001/02 season. Liquidity and financing The Group’s liquid funds at the end of the period amounted to MSEK 135 (72), including non-utilised bank overdraft facilities. Interest-bearing net debt decreased during the period by MSEK 56 to MSEK 798. The average of interest expenses (net financial income as a percentage of average interest-bearing net debt) was 5.8% (5.5). The average fixed interest term on the Group’s overdraft facilities was

Personnel The average number of personnel amounted to 813, which is a decrease of 49 compared to the same period during the previous year. This decrease is an effect of completed structural measures and increased efficiency. Parent company Net sales for the parent company amounted to MSEK 25 (54) during the financial year, of which MSEK 25 (49) refers to invoicing to subsidiaries. Income after net financial income amounted to MSEK –15, compared with MSEK 14 the previous year when MSEK 20 was distributed from subsidiaries. Prior to 2002/03 The investments that have been initiated or planned prior to the forthcoming season include the construction of two chair lifts in Åre and an increased sleeping capacity in cabins, 96 beds in Hemsedal and 738 beds in Sälen. Investments in cabins have been made in Sälen by the part-owned, associated companies. In total, the Group’s investments during the financial year 2002/03 are estimated in the amount of MSEK 130, which is less than the Group’s cash flow. The situation as regards bookings prior to the 2002/03 season is strong, 26% more favourable than it was at this time during the previous year.

New tourist beds have been provided at all of SkiStar’s destinations for the 2002/03 season. In addition, SkiStar has, on the basis of participation in the refurbishment of Tandådalen’s Fjällhotell, taken over the booking of an additional 1,200 beds in Sälen. Proposed appropriation of profits The Board of Directors and Managing Director propose that dividends be allocated at SEK 6:00 (3:50) per share. The total proposed dividends amount to MSEK 58 (34), which is equivalent to 59% (61) of income after tax. The date of 18 December 2002 has been proposed as record day for distribution. The dividends will be paid through VPC as per 23 December 2002. General meeting of shareholders The Annual General Meeting is to be held on 14 December 2002, at 11.00, at Sälen’s Högfjällshotell. The Annual

Report will be distributed to shareholders as per the end of November and will also be available from the company’s offices in Sälen and on the company’s homepage, www.skistar.com. Financial information All financial information is available on SkiStar’s homepage, www.skistar.com, as soon as it is made public. Interim reports during the financial year 2002/ 03 will be made public as follows: – Three-month report 1 September - 30 November 2002, as per 20 December 2002, – Half-yearly report 1 September 2002 - 28 February 2003, as per 20 March 2003, – Nine-month report 1 September 2002 - 31 May 2003, as per 18 June 2003. The year-end report for the financial year 2002/03 will be made public as per 2 October 2003.

Accounting principles The year-end report has been prepared in accordance with the recommendations issued by the Swedish Financial Accounting Standards Council, RR 20 Interim Reports. A number of new accounting principles have come into effect. Of these recommendations, RR 9 Income Tax, has led to a change in accounting principles for SkiStar. Application of RR 9 implies that temporary differences between tax bases and book values are accounted for as deferred income tax recoverables or deferred income tax liabilities in the balance sheet. Changes regarding deferred tax are reported as tax expenses and tax revenue in the income statement.

CHANGE IN EQUITY, TSEK 1 September – 31 August 2001/02 2000/01 Opening equity Effect of changes in accounting principles Adjustment to opening equity Dividends Translation differences Income for the period Closing equity

615 758 - 1 352 614 406 - 33 739 4 184 97 365 682 216

583 052 - 1 559 581 493 - 28 919 8 233 54 951 615 758

A dividend of SEK 3:50 (3:00) per share was paid and the number of shares was 9 639 823. CONSOLIDATED CASH FLOW IN SUMMARY, TSEK 2001/02 Current operating activities Resort cash flow Financial items, net Tax paid Change in working capital Cash flow from current operating activities

1 September – 31 August 2000/01 1999/00

296 792 - 47 632 - 11 131 - 42 962 195 067

230 753 - 47 622 - 14 664 - 7 403 161 064

193 034 - 31 519 - 7 649 - 77 885 75 981

Cash flow from investing activities

- 143 081

- 157 265

- 288 161

Cash flow from financing activities Cash flow for the year

11 341 63 327

8 084 11 883

211 483 - 697

Liquid funds at the beginning of the year Liquid funds at year-end

72 161 135 488

60 278 72 161

60 975 60 278

KEY RATIOS AND DATA PER SHARE 2001/02 Key ratios Earning capacity on - capital employed, % - equity, % - total assets, % Gross margin, % Operating margin, % Net margin, % Equity ratio, %

1 September – 31 August 2000/01 1999/00

13 15 11 33 21 16 39 2002

Data per share Market value, SEK Number of shares Profit, SEK Price/earnings Resort cash flow, SEK Rate /resort cash flow Dividends, SEK Return, % Equity, SEK Market value/equity, %

103:00 9 639 823 10:10 10,2 30:80 3,3 6:00 5,8 71 145

9 9 8 29 16 10 36

11 12 10 28 16 12 36

31 August 2001 2000 79:00 9 639 823 5:70 13,9 23:90 3,3 3:50 4,4 64 123

1999/00 Pro forma 10 8 9 25 13 7 36 2000 Pro forma

80:00 9 639 823 5:19 15,4 20:00 4,0 3:00 3,8 60 133

80:00 9 639 823 3:75 21,3 20:80 3,8 60 133

Pro forma 1999/00 and 2000 includes Åre-Vemdalen AB and Hemsedal Skisenter AB from 1 September 1999 – 31 August 2000. Outcome for 2000 includes Åre-Vemdalen from 1 January 2000 and Hemsedal from 1 April 2000.

NET SALES AND RESULT BY BUSINESS AREA, MSEK Net sales and result by business area 1 September - 31 August. Group-wide expenses in the amount of MSEK 42 (20) have been allocated on the basis of 50% for Sälen, 30 % for Åre and 10% for both Vemdalen and Hemsedal. Sälen 2001/02 2000/01 Net sales Expenses Income before depreciation

437 - 271 166

367 - 242 125

Åre 2001/02 2000/01 270 - 201 69

241 - 186 55

Vemdalen 2001/02 2000/01 63 - 48 15

89 - 78 11

Hemsedal 2001/02 2000/01 127 - 80 47

110 -70 40

CONSOLIDATED INCOME STATEMENT IN SUMMARY, TSEK 2002 Operating income Goods for resale Personnel costs Other external costs Total operating expenses Income before depreciation Depreciation Income after depreciation Financial items, net Income before tax Minority interests Tax Net income for the period Net earnings per share, SEK Number of shares

1 June – 31 August 2001 2000

1 September – 31 August 2001/02 2000/01 1999/00

21 568 - 2 343 - 35 230 - 41 313 - 78 886 57 318 - 6 507 - 63 825 - 11 717 - 75 542 56 18 439 - 57 047

23 345 - 1 723 - 27 755 - 38 988 - 68 466 - 45 121 - 12 814 - 57 935 - 11 122 - 69 057 447 25 214 - 43 396

18 775 - 1 724 - 31 539 - 39 940 - 73 203 - 54 428 - 8 130 - 62 558 - 10 499 - 73 057 886 19 893 - 52 278

896 866 - 71 400 - 268 497 - 260 177 - 600 074 296 792 - 109 979 186 813 - 47 632 139 181 - 113 - 41 703 97 365

807 060 - 73 158 - 256 832 - 246 317 - 576 307 230 753 - 104 614 126 139 - 47 622 78 517 - 2 499 - 21 067 54 951

691 775 - 65 026 - 213 015 - 220 700 - 498 741 193 034 - 81 508 111 526 - 31 519 80 007 - 1 738 - 28 248 50 021

- 5:92 9 639 823

- 4:50 9 639 823

- 5:42 9 639 823

10:10 9 639 823

5:70 9 639 823

5:19 9 639 823

During the year 2000 two companies were acquired, Åre-Vemdalen AB joined the group as per 1 January 2000 and Hemsedal Skisenter AS as per 1 April 2000.

INCOME BEFORE TAX, BY REPORTING PERIOD, TSEK

September - November December - February March - May June - August

2001/02

2000/01

1999/00

- 86 873 142 593 159 003 - 75 542

- 86 588 111 549 122 613 - 69 057

- 42 889 100 625 95 328 - 73 057

2002

31 August 2001

2000

45 412 1 504 970 55 545 1 605 927

26 474 1 458 522 87 829 1 572 825

28 055 1 413 410 78 709 1 520 174

27 665 119 816 147 481 1 753 408

16 754 106 520 123 274 1 696 099

13 559 82 060 95 619 1 615 793

682 216 770 86 728

614 406 4 042 62 946

581 493 2 229 54 509

810 390 -

862 664 1 465

848 687 1 759

45 464 127 840 1 753 408

29 740 120 836 1 696 099

45 265 81 851 1 615 793

CONSOLIDATED BALANCE SHEET IN SUMMARY, TSEK

ASSETS Fixed assets Intangible fixed assets Tangible fixed assets Financial fixed assets Total fixed assets Current assets Interest-bearing Non-interest-bearing Total current assets TOTAL ASSETS EQUITY AND LIABILITIES Equity Minority interests Provisions Long-term liabilities Interest-bearing Non-interest-bearing Current liabilities Interest-bearing Non-interest-bearing TOTAL EQUITY AND LIABILITIES

SHARE PRICE AND TURN OVER

Sälen, 2 October 2002 The Board of Directors

Review of Year-End Financial Statements We have reviewed the year-end financial statements, to the extent and degree required by generally accepted practices. We have noted nothing to suggest that these year-end financial statements do not meet the requirements stipulated by the Stockholm Stock Exchange Act and the Annual Accounts Act. Sälen, 2 October 2002 Lennart Danielsson Auktoriserad revisor Öhrlings PricewaterhouseCoopers AB

Ola Blumenberg Auktoriserad revisor Öhrlings PricewaterhouseCoopers AB

SkiStar AB (publ) SE-780 67 SÄLEN • Corporate Identity Number: 556093-6949 Tel: +46 280 880 50 • Fax: +46 280 218 50 E-mail: [email protected] • Internet: www.skistar.com