Annual report 2019

38 Železiarne Podbrezová a.s.: ANNUAL REPORT 2019 In2020, ŽeleziarnePodbrezováa.s. will again fund its OPEX and CAPEX needs using the club credit facility with a limit of EUR 30 million, extended until July 2024, and other separate loans for short-term financing, which the Company draws according to its operating needs. The total credit facility limit is sufficient for continuous funding next year. The 2020 financial plan was prepared before the outbreak of the pandemic and assumed revenues of EUR 234.8 million and a loss from operating activities, which was to be offset by a profit from financing activities, in particular by dividends received from subsidiaries. The total planned loss after tax was EUR 1.5 million; however, in the current situation, the fulfilment of this plan is very uncertain. Business activities in tourism are undertaken at our subsidiary, Tále a.s., which will be developed further. We are preparing cooperation with a new partner who has been operating in hospitality and tourist services for a long time. As a result, tourism in the Tále region should be improved in terms of quality and made more effective. Subsidiaries in the consolidated ŽP GROUP work closely with the parent company and contribute to the overall results of operations. We plan a profit for most companies in 2020, which will be used to develop the companies appropriately and generate dividends for the parent company. Consolidated revenues from the sale of goods, products and services for 2020 are planned in the amount of EUR 328 million, with a consolidated loss after tax of EUR 1.2 million. CONCLUSION In 2020, Železiarne Podbrezová a.s. celebrates 180 years of existence. Just as the Company’s history is full of successful and more difficult periods, the last four years saw the economic cycle alternate between a downturn and a boom. Despite the current very uncertain situation in the global economy, including in the steel market, we believe that the current crisis will leave our Company stronger and more efficient, and that it will maintain its market position thanks to its high-quality products, competitive prices and very good service for our customers. In 2019, we made good use of the Company’s production capacity, real wages of our employees increased, we made major investments in accordance with the investment plan and we also generated an operating and overall profit and paid dividends to the shareholders. Despite significant risks in the global economy and uncertainties in operational production and sales planning, we believe that the steady growth of the global population, greater urbanisation, long-term demand for personal mobility and the associated extraction of raw materials ensures a permanent place for the production of steel tubes in industry and the economy. Železiarne Podbrezová a.s. acted flexibly and took advantage of all market opportunities during 2019. The Company’s Board of Directors considers 2019 as positive both in terms of production and results of operations, given the circumstances. All employees, including the management and employees of subsidiaries, contributed to the Company’s success. The 2019 profit amounted to EUR 7 239 thousand, with earnings per share of EUR 3. However, in the current uncertain situation, the Board of Directors proposes to the General Meeting to retain the generated profit in the Company to strengthen its financial position in the future. REPORT BY THE BOARD OF DIRECTORS ON BUSINESS ACTIVITIES, ASSETS AND FINANCIAL PERFORMANCE IN 2019 AND INFORMATION ON THE BUSINESS PLAN