Annual Report 2007

23 Ž E L E Z I A R N E P O D B R E Z O V Á 2 0 0 7 REPORT BY THE BOARD OF DIRECTORS As of 31 December 2007, total assets of the Company amounted to SKK 8 379.8 million, which represents a rise of 13.8% compared to the prior year. Non-current assets increased by SKK 978.5 million, mainly due to the investments in sub- sidiaries and associated undertakings. As of 31 December 2007, cost of non-cur- rent tangible assets represented a total of SKK 8 147.5 million, thereof lands and structures represented SKK 3 172.2million, machines and equipment SKK 4 894.4 million, and assets under construction SKK 81.0 million. As of 31 December 2007, the net book value of buildings, structures, machines and equipment totalled SKK 2 701.5 million, i.e. non-current assets were depreciated in the books at 66.8%. Entire assets were insured against all risks with Allianz – Slovenská poisťovňa a.s. Additions to non-current financial assets worth SKK 949.4 million represented changes in investments in subsidiary and associate undertakings and joint ventures -- the most significant were: - addition to ownership interest in ŽP EKO QELET a.s., of SKK 671.3 million, referred to the purchase of additional portion of shares of the company up to 66.25% and additional increase of registered capital; - acquisition of a 50% ownership interest in KBZ s.r.o. Košice, for SKK 90.9 million; - acquisition of a 100% ownership interest in ŽIAROMAT a.s. and subsequent in- crease in the registered capital of the company in the amount of SKK 145.9million. Other additions include the increase in the registered capital of Tále, a. s. by SKK 45.0 million, incorporation of ŽP Informatika s.r.o. – SKK 25.0 million, acquisition of a 100% ownership interest (SKK 11.4 million) in ŽP PRAKO s.r.o., and subsequent increase in the registered capital of this company by SKK 50 million. A decrease in other financial assets by SKK 122.7 million represented year-to-year drop in financial derivative instruments acquired by the Company based on contracts with banking institutions in order to cover the risk of foreign exchange rate fluctuation by specific transactions. Železiarne Podbrezová a.s. also entered into similar contracts in 2008 in order to manage the risk resulting from the ordinary course of business and loans received in a foreign currency. REPORT BY THE BOARD OF DIRECTORS ON ASSETS AND FUNDS AND FINANCIAL MANAGEMENT Assets and funds Interest-bearing loans and borrowings Other non-current liabilities Other current liabilities Equity 62% 17% 6% 15% Financial assets Receivables Inventories Other assets Property, plant and equipment 32% 30% 18% 19% 1% 100 % 100 % Structure of assets As at 31. 12. 2007 Structure of liabilities As at 31. 12. 2007 An increase in the balance of current assets by SKK 36.8 million in total mainly resulted from the decreased balance of trade receivables by SKK 210.4 million with current increase of inventories by SKK 242.9 million. Such changes were due to the extensive repair of technology at the end of 2007.