Annual Report 2008

REPORT BY THE BOARD OF DIRECTORS ŽELEZIARNE PODBREZOVÁ consolidated revenues reached EUR 31 017 thousand (SKK 934.4 million) The comparison of the individual markets shows a change in the territorial structure and an ongoing downturn on the domestic Spanish market. This development is caused by the transfer of production by customers abroad and a drop in the automotive industry. The EU countries, USA and Australia remain the dominant market segment; other markets include Turkey,Ukraine, lran, Chile,Mexico and Egypt. In the second half-year, the Company synchronised the sales activities of its Sales department and commission agents with the centralised sales efforts of Železiarne Podbrezová,which were managed on a territorial basis by means of its trading companies in ltaly, the Czech Republic,and Poland. The total consolidated assets as at 31 December 2008 amounted to EUR 28 976 thousand (SKK 872.9 million) The major investment in 2008 was the purchase of an automated warehouse of finished products, which will enhance the sales logistics on adjacent territories within the entire ŽP Group. The consolidated current assets as at 31 December 2008 amounted to EUR 18.3 million (SKK 551.3 million). In spite of significant capital expenditures, the share of own funds on the financing ot the companies was 57.6%. In 2008, both companies had a total ot 194 employees. In late 2008, when the contracted volumes dropped and production was curtailed, the headcount was decreased, mostly among temporary workers. These measures did not produce additional personnel expenses. The average number of employees for the year was 187. The pian for the next year is to continue expanding the network ot customers and to ensure the fulfilment of the set production and financial objectives in spite of the difficult market situation by using the synergie effects in sales and input materials. ŽĎAS, a.s. In economic terms,we regard 2008 as the most successful year in the new history of ŽĎAS, a.s.,one ot the leading heavy industry producers. All supplies to customers are carried out through own external assembly and high quality ot servicing activities. Exports represent a significant group of customers, accounting for 58% ot the total sales in 2008. The most significant customers are from Russia, Germany, India, Spain the Slovak Republic, and other countries, predominantly in the European Union. Sales of finished goods, merchandise and services for 2008 amounted to CZK 5 131.2 million (SKK 5 803.2 million, i.e. EUR 192.6 million) Profit after tax was reported in the amount ot CZK 404.0 million (SKK 456.9 million, i. e. EUR 15.2 mil– lion). In terms ot capital expenditures, in 2008 ŽĎAS, a.s. invested a total ot CZK 319.8 million (SKK 361.7 million, i.e. EUR 12.0 million),ofwhich CZK 262.4 million (SKK 296.8 million, i.e. EUR 9.9 million) was invested in new technologies and the modernisation ot manufacturing equipment. Tále, a.s. Tále, a.s., is an integral part of the business of Železiarne Podbrezová in the field ot tourism. A separate resort consists ot a sports area comprising a ski centre with artificial snow production and a golf centre comprising an 18-hole championship golf course: Gray Bear. The resort includes two hotels providing, apart trom standard services, also congress tourism and golf vacations. In 2008, Tále, a.s. sold services totalling SKK 124.9 million (EUR 4.1 million) and reported a profit of SKK 1.1 million (EUR 36.4 thousand). The average number ot employees was 105. Tále, a.s.'s total assets as at 31 December 2008 amounted to SKK 483.5 million (EUR 16.0 million), with external debt accounting for 11 %.