Slide 1

Q3 Interim Report 2006November 2, 2006

Slide 2

• Group business organisation

• Q3 2006 In Brief

• Sales Analysis

• Profitability Analysis

• Cashflow & Working Capital

• Strategy Implementation

• Refinancing of Bank Debt

• Outlook for 2006

AGENDA

Slide 3

STRONG SALES IN SEASONALLY SLOW Q3

Q3 2006 - strong sales in a seasonally slow quarter - acquisitions and start-ups Increased sales of fishing tackle products improved result: positive operating profit Group’s strategy implementation and integration of new businesses progressed New loan facility with Nordea and OKO to support growth and reduce financing costs Guidance for 2006: sales somewhat above 220 MEUR, operating profit above 2005

EUR million III/06 III/05 I-III/06 I-III/05 2005

Net Sales 49.8 39.0 177.4 151.3 196.1

EBITDA 4.4 1.3 25.6 23.0 26.9

Operating Profit (EBIT) 2.8 - 0.2 21.0 18.8 22.1

Profit Before Taxes 1.0 - 0.5 14.9 18.1 19.2

Net Profit for the Period 0.4 - 0.6 10.5 13.2 14.7

EPS (basic), EUR 0.01 - 0.01 0.27 0.35 0.39

Equity-to-assets, % 34.9 34.0 34.9 34.0 33.8

Net Interest-bearing Debt 98.4 79.2 98.4 79.2 95.9

RAPALA FINLAND IRELAND ESTONIA

SOFTBAITS STORM

OTHER LURES BLUE FOX LUHR JENSEN

WILLTECH

HONG KONG CHINA

HOOKS & TERMINAL

TACKLE

KNIVES

CX SKIS

SHIMANO

OTHER FISHING

HUNTING

OUTDOOR

WINTER SPORTS

ACCESSORIES LINE

RODS&REELS XC SKIS

FINLAND SWEDEN

NEW ZEALAND USA

CHINA

KNIVES

REST OF EUROPE

REST OF WORLD

Dis

trib

uti

on

Gro

up

B

ran

ds

MANUFACTURING AND R&D SOURCING R&D

OWN R&D AND MANUFACTURING OR SOURCING

OWN GROUP BRANDS

OWN DISTRIBUTIONSHIMANO

LOCAL IMPORTERS

THIRD PARTY SUPPLIERS

Su

pp

ly

SO

UR

CE

PR

OD

UC

T

HARDBAITS RAPALA

SPINNERS BLUE FOX

STORM

2006 GROUP BUSINESS ORGANIZATION

Slide 4

FINLAND

SWEDEN

DENMARK

NORWAY

FRANCE

SPAIN

SWITZERLAND

USA

CANADA

JAPAN

BRAZIL

AUSTRALIA

CHINA

THAILAND

ESTONIA

POLAND

RUSSIA

UKRAINE

LITHUANIA

LATVIA

HUNGARY

ITALY

GERMANY

NETHERLANDS

BELGIUM

VMC FRANCE

WILLTECH CHINA

MARTTIINI FINLAND, ESTONIA & CHINA

PELTONEN FINLAND

PORTUGAL

MALAYSIA

CZECH REPUBLIC

SOUTH AFRICA

Tortue

Slide 5

MARKET SITUATION AND SALES

– Third quarter is traditionally the slowest quarter in terms of sales due to the seasonality of the fishing tackle business.

– This seasonality has been mitigated by expanding the Group’s sales operations in southern hemisphere and closer to equator, including the acquisitions of Australian Freetime in 2005 and South African Tatlow & Pledger in 2006.

– Also new start-up operations in Malaysia, Thailand and China balance the seasonality.

– This has increased the sales of fishing tackle products in July to September.

– Summer and fishing tackle season started late in many countries but lasted longer than generally and lengthened the total season for fishing tackle sales.

– Effects of working capital initiatives of few major US customers also ceased and the underlying healthy customer demand was reflected in sales.

– Sales in the seasonally slow third quarter were quite good in North America and Europe even if a few countries suffered from a dry and very warm summer.

Slide 6

SALES ANALYSIS

• European sales were up 23% for Q3 and 14% for 9 months, boosted by strong growth in Eastern Europe. • North American sales exceeded last year by 14% for Q3 and 5% for 9 months.• Sales growth in Asia, Africa and Australia continued strong while southern hemisphere headed for their peak season in fishing tackle sales.• Both absolute sales and relative portion of fishing tackle sales increased clearly from 2005.• Q3 net sales were up 28% from last year and amounted to 49.8 MEUR (III/05: 39.0 MEUR).• Foreign exchange movements had next to none effect on third quarter sales. • Net sales for the first nine months increased 17% to 177.4 MEUR (I-III/05: 151.3 MEUR).

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Q1/05 Q2/05 Q3/05 Q4/05 Q1/06 Q2/06 Q3/06

MEUR

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50

100

150

200

I-III/05 I-III/06ME

UR

Slide 7

PROFITABILITY ANALYSIS

0,0

5,0

10,0

15,0

20,0

25,0

I-III/05 I-III/06

MEU

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-2

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Q1/05 Q2/05 Q3/05 Q4/05 Q1/06 Q2/06 Q3/06

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R

– Q3 operating profit increased to 2.8 MEUR (-0.2)

• Main driver behind this improvement was the increased sales of fishing tackle products.

• Net effect of foreign exchange movements (+0.7 MEUR) and increased integration and business development costs (-0.7 MEUR) was zero. • Operating margin for the quarter was 5.7%.

– 9-month operating profit up to 21.0 MEUR (18.8)

• Improvement from increased sales of fishing tackle. • Includes negative foreign exchange effects 0.9 MEUR • 2005 9-month operating profit include 0.7 MEUR more IFRS based option expenses (non-cash item).• Increased integration and development costs decreased 2006 result by 2.9 MEUR. • Operating margin for nine months was 11.8%.

– All geographical segments improved their profits

Slide 8

CASHFLOW AND WORKING CAPITAL

• Cash flow from operating activities increased from Q2 to 10.2 MEUR (12.6 MEUR)• Working capital decreased clearly from June. Comparable inventories close to last year levels• Capital expenditure for Q3 was 3.0 MEUR (4.8 MEUR) & 9-months 10.3 MEUR (7.8 MEUR)• Net interest-bearing debt decreased from June to 98.4 MEUR (Dec 2005: 95.9 MEUR)

• Equity-to-asset increased to 34.9% (31.12.: 33.8%)

• Gearing decreased to 116.7% (31.12.: 124.1%)

STATEMENT OF CASH FLOWS July-Sept July-Sept Jan-Sept Jan-Sept Jan-Dec

EUR million 2006 2005 2006 2005 2005

Net profit for the period 0.4 - 0.6 10.5 13.2 14.7

Adjustments - 0.4 1.3 7.9 4.7 2.0

Change in working capital 10.2 11.9 - 8.3 - 5.8 -4.2

Net cash generated from operating activities 10.2 12.6 10.1 12.1 12.5

Net cash used in investing activities - 3.0 - 4.8 - 10.3 - 7.8 -16.6

Cash flow before financing activities 7.1 7.8 -0.2 4.4 -4.1

Net cash generated from financing activities - 8.1 - 2.2 4.2 6.1 7.4

Adjustments 0.3 0.3 - 0.6 1.4 1.2

Decrease in cash and cash equivalents - 0.6 5.9 3.4 11.9 4.4

Slide 9

STRATEGY IMPLEMENTATION IN Q3 2006

Rapala’s strategic objective is profitable growth, founded on 3 established strenghts: Unique manufacturing and sourcing platform in China and Europe Leading global distribution network in fishing tackle industry Strong brand portfolio with several leading brands

During the third quarter, management continued discussions and negotiations regarding acquisitions and business combinations to implement the Group’s strategy.

Work on integration of acquired businesses and development of organic growth on plan. Manufacturing of Luhr Jensen products ended in the USA in June and the first products from the

Group’s Chinese factory were delivered in September.

Integration of sales companies acquired in 2005 as well as Marttiini and Peltonen manufacturing operations is almost completed.

Start-up process of the new sales companies in Asia continues to proceed well

Ramp-up of the production at the new knife factory in China is completed.

Establishment of the new manufacturing unit in Russia for assembling lures proceeds on plan. The premises are currently being prepared and refurnished and the personnel are being hired.

Sales growth in Eastern Europe continued strong through Group’s own distribution network.

Slide 10

REFINANCING OF BANK DEBT

Nordea Bank and OKO Bank as Lead Banks for Rapala

– Rapala finalized the refinancing of its bank debt in the end of October.

– New 7-year loan facility (130 MEUR) is a combination of 60 MEUR multicurrency term loan and 70 MEUR multicurrency revolving credit facility.

– Nordea and OKO currently hold more than 90% of the Group’s bank debt.

– New loan facility strengthens the Group’s capabilities to finance the strategy for profitable growth and reduces financing costs.

Commercial Paper Program of 25 MEUR

– Rapala signed a 25 MEUR domestic commercial paper program on October 31.

– Rapala’s first ever commercial paper program.

– It will be used to finance working capital and other short-term financing needs.

– Under this program, Rapala can issue commercial papers with a maturity of less than a year.

– OKO Bank acts as the arrangement bank in the program.

Slide 11

OUTLOOK FOR 2006

Shipments of the new fishing tackle products for 2007 season are about to start Fishing tackle market expected to remain quite stable in North America and Western Europe

Markets continue to grow in East Europe, Asia and Africa.

Distribution of winter sports equipment to retail stores has just started in North Europe while Australia and South Africa are in the middle of their high season for fishing tackle sales.

It is expected that the Group’s net sales for 2006 will be somewhat above 220 MEUR.

Profitability of the Group’s ongoing operations continues to be good. Implementing the growth strategy and integrating the acquired businesses has increased the fixed costs and this will continue.

Operating profit is expected to be in absolute terms above last year level but achieving the 2005 operating margin level (operating profit per net sales) will be challenging.

The full benefit of the completed acquisitions will materialize from 2007 onward.

Project to reduce working capital continues: target to see an improvement on ongoing operations while the new acquisitions and start-ups will tie additional working capital.

Group management continues planning and negotiations on further acquisitions, new start-ups and business combinations to implement the Group’s strategy.

Slide 12