Annual Report 2003

REPORT BY THE BOARD OF DIRECTORS ANNUAL REPORT Ž E L E Z I A R N E P O D B R E Z O V Á 2 0 0 3 24 Net profit for 2003 of 88 956 thousand SKK represents the difference between total income of 6 407 664 thousand SKK and total expenses of 6 318 708 thousand SKK. The structure of income has not substantially changed since 2002. Income from operations represented 94,15 % of the total, and is derived mostly from revenue from the sale of own products and services and from own work capitalized. Income from financial activities represented 5,85 %. The expenses structure has also remained unchanged. Operating expenses, of which mainly relato to the consumed rawmaterials, energy, and personnel expenses, prevailed, representing 93,15 % of total expenses. Expenses related to financial activities represented 6,31 % of the total cost. The remaining 0,54 %, are income tax related expenses. As for individual expenses items, a significant rise by 160 790 thousand SKK was shown in energy consumption, or in relative terms this is 29,74 %. Other expenses items remained more or less on the 2002 level. The profit from operations of the company in 2003 amounted to 146 575 thousand SKK, i.e.by 58,55 % lower than in 2002. The main reason for such a decrease is, that the increase in revenue from the sale of own products and services and the savings on cost for services were unable to compensate for the 30 % increase in the price of energy consumed. A drop in added value by 4 % has not been reflected in personnel expenses saved, which dropped by no more than 1 %. Profit from ordinary activities impacted the reduced loss from financial activities. Net profit of the company of 88 957 thousand SKK compared with 2002 was lower by 35,57 %. Expenses, income and profit of 2003