Annual Report 2013 2013 CONTENTS
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HOLDING VISOKOGRADNJA OPREMA NIS HOLDING VISOKOGRADNJA OPREMA ENERGODATA NISKOGRADNJA HIDROINŽENJERING INDUSTRIJA URBANIZAM I ARHITEKTURA ENTEL HIDROINŽENJERING ENERGODATA ENTEL URBANIZAM I ARHITEKTURA NISKOGRADNJA ENTEL INDUSTRIJA GARANT VISOKOGRADNJA OPREMA HOLDING ENERGODATA HIDRO URBANIZAM I ARHITEKTURA INDUSTRIJA ENTEL ENERGODATA NISKOGRADNJA HIDROINŽENJERING OPREMA INDUSTRIJA OPREMA GARANT HOLDING VISOKOGRADNJA GARANT NISKOGRADNJA GARANT HOLDING VISO VISOKOGRADNJA URBANIZAM I ARHITEKTURA HIDROINŽENJERING NISKOGRADNJA GARANT ENERGODATA HOLDING INDUSTRIJA ENTEL Annual Report Annual Report 2013 2013 CONTENTS 1. Letter to Shareholders 2. Brief History 3. Organization Structure 3.1 Organization Structure – Energoprojekt Group 3.2 Organization Structure – Energoprojekt Holding 4. Main Business Activities 5. Markets 6. Selected References 6.1 Energy – Generation, Transmission and Distribution 6.6 Building – Engineering and Construction 6.12 Infrastructure 6.16 Water – Environmental Protection 6.20 Industry 6.23 Information Technologies 7. Financial Highlights 8. Financial Report 8.1 Auditors Report 8.2 Balance Sheet 8.4 Income Statement LETTER TO SHAREHOLDERS Dear shareholders of Energoprojekt Holding plc, The year of 2013. was very diffi cult for business operations and burdened by market challenges, both abroad and in the country. However, the management of Energoprojekt Group managed to limit the eff ects on those negative trends on business results the system achieved on certain markets, by making adequate decisions and applying timely corrective measures in business segments where it was needed. In the time of crisis, it is of crucial importance to provide adequate conditions for sustainable business operation, to enable long-term growth and justify the trust of our shareholders. Our legacy, 63 years of long and successful business history, teaches us to recognize the direction our business is taking as well as the forms of adapting it to more intensive changes occurring in global business. It also teaches us to improve ourselves and our overall business capacity, at mutual satisfaction of the shareholders and employees, by investing in our staff and other business resources, monitoring and implementing modern technologies, following the principles of sustainable development, environmental protection and social responsibility. Not only were the domestic investment activities signifi cantly reduced, but the foreseen realization of large projects was also disturbed by the lack of fi nancial funds and changed requirements of our employers. Under the current circumstances, and by taking short-term measures, the achieved results of Energoprojekt Group, though not quite as planned, may be considered satisfactory, especially because Energoprojekt Group is in the position which enables it to use all possibilities following the increased investment activities on all markets and signifi cantly increase the value of contracted projects and growth of overall income and profi t, foreseen in the following cycle of investments into Serbian infrastructure, commercial and public facilities and foreign markets. The consolidated total revenue of EUR 213.1 million has been generated, which represents 90% of foreseen revenue, while the consolidated gross profi t of EUR 5.3 million represents 70% of total foreseen profi t. Two thirds of the revenue result from the realization of the foreign projects, and one third from the domestic projects. The region of Serbia, with 32.9%, had the largest market share in total revenue for the year 2013, followed by the region of Africa (Uganda, Nigeria, Ghana, Zambia, Algeria, Zimbabwe, Guinea) with 27.9%, the region of CIS (Kazakhstan, Russia) with 12.4%, the Middle East (Qatar, Abu Dhabi, Oman, Jordan) with 12.3%, the region of South America (Peru) with 13.6% and the region of Europe (B&H – Republic of Srpska, Montenegro, FYR Macedonia, the United Kingdom, Germany, Cyprus) with 0.9%. The most important contracts, realized either completely or partially, during the year of 2013 are the following: Consulting and designing Consulting services on the project of improvement of potable water reserves “Water Security Mega Reservoirs” in Qatar, Qatar Consulting services on the project of construction of electric power transmission and distribution system in the Northern Emirates, UAE Designing, technical support, supervision on the construction of three dams - Seklafa, Beni Slimane, Soubella, Algeria Designing and tender documentation preparation for the Tarzout dam, Algeria Preparation of investment-technical documentation and consulting services required for the project of revitalization and modernization of 15 small hydroelectric power plants, Serbia Engineering, project management and execution of works Rehabilitation of unit 2 and reconstruction of electrostatic precipitators of the thermal power plant Kostolac B, Serbia Construction of two doublecircuit 132kV transmission lines, 24km and 18km long, near Port Harcourt, Nigeria Construction of a doublecircuit 330kV transmission line, 160km long, Erukan-Omotosho, Nigeria Design, equipment procurement, construction and commissioning of the transformer substation Oke-Aro (Erukan); SG 2x300MVA 330/132kV; 2x60MVA 132/33 kV, Lagos, Nigeria Project on turn-key basis for the International congress center with the 5* hotel »Hyatt Regency Rostov Don – Plaza«, Rostov on Don, Russian Federation 1.0 Annual Report 2013 | Letter to Shareholders In 2013 the consolidated total rev- enue of EUR 213.1 million has been generated. Two thirds of the revenue result from the realization of the for- eign projects, and one third from the domestic projects. Design, construction and procurementnt of medicalmedica equipmentipment for the medicalm center Sofi e Medgroup, Aktau, Kazakhstan Construction of administrative building of thee companycompany »Gasprom«, »Gaspr Ukhta, Russian Federation Construction of the production base »Schlumberger«, Astrakhan, Russian Federation Construction of cash processing center of the Bank of Ghana, Accra, Ghana Construction of a new sulfuric acid plant and reconstruction of the fl ash smelter within MSB Bor, Bor, Serbia Construction of the tunnel Šarani, highway E 763 (two tunnel tubes, 883m and 887m long), Serbia Perikos-San Ignacio road reconstruction and rehabilitation, 55 km long, Peru Mpigi-Kanoni road reconstruction, 64km long, Uganda Asphalt placement on the Kawempe-Kafu road, 166km long, Uganda The value of the projects contracted during 2013 amounted to EUR 160.7 million, i.e. 60% of the foreseen amount. The value of the projects contracted in the country amounts to EUR 11.4 (7%) while the value of the foreign projects amounts to EUR 149.4 million (93%). At the end of 2013, the amount of EUR 364.6 million of contracted projects remained to be completed by the Energoprojekt Group (EUR 70.5 million in the country and EUR 294.1 million abroad), which represents a signifi cant business potential which provides future business stability. Uneven distribution of the remaining part of works among the joint-stock companies within the Energoprojekt Group may represent a potential problem. On the December 31st, 2013, Energoprojekt Holding plc recorded the annual growth in the price of its shares of +19.01%, compared to the end of the previous year. During the same period, the registered increase of the reference index BELEX15 was signifi cantly lower and it amounted to +6.51%, while the increase of the index BELEXline amounted to 9.88%. Achieved trade price (on the last day of the reporting period – December 31st, 2013) was RSD 720 per share, while during the year 2013, the price of shares ranged from RSD 531 to RSD 794 per share. The ratio of market-to-book (accounting) rates (P/B) was 1.03, indicating that increasing the investments in the Republic of Serbia and greater involvement of Energoprojekt in domestic and foreign markets, the value of the share capital of the Energoprojekt Group has s signifi cant growthrowthh ppotential.otential.ote tial. ThThehe ovoverallveralerall rrealizedreal zed tturturnovern of the shares of Energoprojekt Holding plc in the year of 2013 amountedmounounteeddto too RRSRSDD 88882882,276,30982,276,,276,30976,306,309 (which(whichw makesmaakeske thethe sharesshareshahares of ENHL the 5th in rank of the most traded shares on thee BelgradeBeBelgB lgradede SStocktockk ExcExchangexchhaangenngge ini 2012013).) Consolidatedolididateddateded fi nancialnannancncialc al statements,sta tet meentnts,s prpresenpresentednted witwithinthinth ththisis AnnAnnualn ualal RepoReport,rt,r in all mmaterialate respects, are a true and objectiveectiveve presentationpreseppresentasentaatitionon off ththee fi nancialn n ialal situatsituationtuation withinhin ththehe EEnergopEnergoprojektro kt GrouGroup.up Allll reportsr were prepared in accordanceaccccordancordancce wwith ithh thee currentcurrenurre t accountingaaccouno tin regregularegulationsg ons anand popolpolicies,icies,s, appliapplicaapplicableb in the RRepublicepe u c oof Serbia, respecting the principlesprprinciplncip es off transparency,transparencyarenncy, independence,iin indepep ndenen accuracyccucuracy aandnd coccomplcompleteness.eteness. TThesehese reportss providevidee tot all interested parties (shareholders,((sh oldeers, clients,ient businessbuusisiness partners,ppartners,rs etc.)e complete,comcomplecomplete, accurateaccuratcura e anandd oobjectiveive ddataa on all achievedhhiiev d results. In thehe end,eend, wee wouldwwouould likeke to thankthank all our businessbbusin s partners,partpartners,