SPP VS Eng 2010 Ri23.Indd
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SPP has been able to retain its leading position on the market by providing competitive offers to customers and by adding value in terms of reliability, flexibility and customer care. Dr. Achim Saul Content Statement by the Chairman of the Board of Directors 6 Company Profile 8 Strategy and Goals of the Company 9 Board of Directors 10 Top Executive Management 12 Supervisory Board 14 Economic and Financial Performance 15 Capital Structure 17 Natural Gas Trading 19 Integrated Communication 27 Human Resources 28 SPP for the Future 30 Equity Holdings 41 Individual Financial Statement of SPP 42 Independent Auditor’s Report 44 Consolidated Financial Statement of the SPP Group 46 Independent Auditor’s Report 50 Contacts 52 Statement by the Chairman of the Board of Directors SPP has been able to retain its leading position on the market by providing competitive offers to customers and by adding value in terms of reliability, flexibility and customer care. Dear ladies and gentlemen, 2010 was a year with a very heterogeneous experience for SPP. The partial recovery of the Slovak economy throughout the year certainly had a positive impact on certain parts of SPP’s business. Rising demand for gas increased sales, as well as distribution and transport volumes on the market. SPP nevertheless faced its highest ever loss in respect of its gas supply activities. Significant part of these losses was derived from the company´s gas sales in the regulated segments of households and heating plants. In figures it meant loss before tax of over EUR 70 million. The sales prices set by the regulator for these segments dit not allow the company to recover its gas purchase and delivery costs, and so created a negative margin for each cubic meter sold. Given that regulated prices for 2011 also still do not allow the actual full cost to be recovered, SPP will again face losses, but this time they will be of an even higher magnitude than last year’s record loss unless some appropriate solution is implemented soon. As representative of SPP, I can accept transparent and fair price regulation. Such price regulation, though, regardless of how exactly it is applied, essentially has to fully and duly take into account the real cost of the energy supply, while also allowing reasonable profit for the business in question. SPP is available to actively support ÚRSO in the development of a transparent and fair method for the new regula- tion period starting in 2012. In non-regulated segments, SPP has been operating on a fully liberalized gas market. In 2010, price has probably become the most deci- sive criterion for customers when choosing their gas supplier. SPP has been able to retain its leading position on the market (82% market share) by providing competitive offers to customers and by adding value in terms of reliability, flexibility and customer care. 6 As a natural consequence of rising competition on the Slovak gas market, the company lost some customers for 2011. On the other hand, we succeeded in regaining some customers that we had previously lost. This gives us valuable feedback that many customers have been satisfied with SPP’s services and have decided to continue their business relationship with SPP. Complementing its domestic sales activities, SPP actively trades on neighbouring gas hubs in order to optimize its gas portfolio. SPP also managed to build up a successful business operation on the Czech market via its subsidiary SPP CZ, which currently ranks third on the Czech gas market in terms of import. In 2010, SPP was also able to expand its business portfolio in the Czech Republic even further by increasing its shareholding in SPP Bohemia to 100%. In order to enhance its operational efficiency, in 2010 SPP focused on the reorganization of the company and strict cost management. As an example, SPP successfully implemented Slovakia’s largest ever car fleet outsourcing project in 2010. The SPP group also started aligning its organization in 2010 to the requirements set by the 3rd Energy Package, with the process to continue until 2012. In parallel, we use these necessary changes as an opportunity to further optimize our organisational structure and processes in general. 2011 will be a very decisive year for SPP. The Slovak government has to decide on the transposition of the 3rd Energy Package into national legislation. Three implementation models for achieving this are equally acceptable for the EU. The aim of the directive is to ensure non-discriminatory and transparent access to energy infrastructure. Whichever model is chosen, there will be no difference for Slovakia in terms of the degree of market liberalization achieved or the effect on gas prices. SPP shares the position of the Slovak Government declared in all past discussions on the EU level, which favours the so-called Independent Transmission Operator (ITO) model as the best one for Slovakia. Only under this model will Eustream be able to remain 100% within the SPP group and SPP be able to retain a size to keep it in the European Champions League of energy companies. In line with its strong commitment to sustainability in energy supply and consumption, SPP has intensively promoted the efficient use of energy. In 2010 we offered our customers the option of consulting energy savings via our seven Customer Centres and our interactive web page www.sppporadimevam.sk. We continued to support the use of environmentally friendly CNG (Compressed Natural Gas) as a fuel for cars. Sales of CNG in Slovakia increased by 2.9% compared to the previous period, but in 2011 this trend might be negatively influenced by higher excise tax on natural gas as a fuel for CNG. In 2010, SPP won the TOP Corporate Philanthropist award for the fifth time in a row. The key programme “Let’s renovate our house” aims to protect important Slovak cultural heritage. SPP also continued its long-lasting close cooperation with the Slovak Paralympic team, which confirmed its excellent quality and talent at the Xth Winter Paralympic Games in Vancouver, Canada. SPP also continued to support projects aimed at energy savings and at improving energy efficiency. All these projects serve as proof that the company acts as a socially responsible entity. I am fully committed to caring for our most valuable capital - our employees. Skilled, motivated and loyal employees are crucial to face challenges and to achieve the company’s vision successfully. Apart from well-established tools of open communication, we gave employ- ees the incentive to play an active part in improving the working environment, enhance efficiency and improve the image of the company through their ideas and proposals. In 2010, the company agreed with the Trade Union on a new 3-year Collective Agreement with effect from 1st January 2011. I am confident that it provides our employees with the necessary benefits and security for the coming years. I know that the good results in 2010 could only be achieved thanks to efficient teamwork, close cooperation and the strong commitment of all employees. I would therefore like to express my thanks to all employees for their responsible and efficient cooperation. I would also like to express my gratitude to our customers, business partners and shareholders for the trust, loyalty and cooperation you have shown us. I am confident that by ongoing and targeted improvement, the company can master challenging times and maintain the trust of our customers, business partners and employees. Dr. Achim Saul Chairman of the Board of Directors 7 Company Profil Slovenský plynárenský priemysel, a.s. (SPP) is a multinational energy company and a reliable supplier of energy and services. SPP directly follows on from over 150 years of gas industry in Slovakia. Structure of SPP shareholders Slovenský plynárenský priemysel, a.s. was established in 2001 by the transformation of a state-owned company. In 2002, the State sold a 49% share to strategic investors – German Ruhrgas (currently E.ON Ruhrgas) and French Gaz de France (currently GDF SUEZ), as a result of which SPP became an integral part of the largest family of energy companies in Europe. The shareholders of Slovenský plynárenský priemysel, a.s. are the National Property Fund (51%) and Slovak Gas Holding – a consortium of the companies E.ON Ruhrgas and GDF SUEZ (49%). Slovak Gas Holding (E.ON Ruhrgas and GDF SUEZ) 49% National Property Fund 51% 8 Strategy and Goals of the Company The mission of SPP is to provide reliable and competitive supplies of energy to Slovak and interna- tional customers. SPP’s vision is to be one of the leading energy groups in the region of Central and Eastern Europe by strengthening the trust of its cus- tomers and business partners through quality, safe and reliable energy supplies and services, as well as the technical know-how and professionalism of our employees. We offer solutions for saving energy and we support initiatives oriented on sustainable development. In the context of constant changes in the business environment and trends in the energy sector, SPP pursues the following strategic goals: n to strengthen our customer orientation in order to stabilise the customer portfolio and ensure long-term and reliable supplies of natural gas to SPP’s customers, n to increase the sales of natural gas on other markets and to enter the market with other energies, n to improve all support processes and services within the company so that they support the strategy of the company’s core activities to the maximum possible extent, n to contribute to the creation of a fair, transparent and competitive business environment, n to develop the entrepreneurial activities of SPP in related energy sectors with the goal of supporting sales of natural gas as an environmentally-friendly commodity with the lowest production of CO2 among all fossil fuels, n to develop projects for utilising renewable energy sources, which in addition to lowering energy depend- ency and increasing the energy security of Slovakia, contribute significantly to reducing emissions of pol- lutants into the atmosphere, n to implement the 3rd Energy Package without SPP losing value.