NEMESIS S.A. Annual Report 2007 Design - Production: 2007 2007 12A Irodou Attikou str., Annual Report Maroussi 151 24, Athens - GREECE Tel.: (+30) 210 809 4000, Fax: (+30) 210 809 4444 www.moh.gr CMYK CORINTH REFINERIES S.A. Annual Report 2007 TableTable of of contents contents 1 INFORMATION CONCERNING THIS ANNUAL REPORT AND THE COMPANY AUDITORS............................6 2 SHAREHOLDERS’ RIGHTS ..............................................................................................................................8 2.1 General Information ..................................................................................................................................8 2.2 Dividend Taxation......................................................................................................................................9 3 MARKET INFORMATION AND STRUCTURE ................................................................................................10 3.1 Structure of the Oil Refining Market in Greece ..........................................................................................10 3.2 Regulatory Framework ............................................................................................................................11 3.3 Recent Developments in the International Oil Market ................................................................................14 4 COMPANY PROFILE ......................................................................................................................................15 4.1 General Information ................................................................................................................................15 4.2 Background ............................................................................................................................................17 4.3 Company Activity - Fixed Assets ................................................................................................................19 4.4 Sales & Distribution Network – Customer Service ......................................................................................20 4.5 Share Capital – Shareholder Structure ......................................................................................................20 4.6 Company Administration & Management ................................................................................................21 4.7 Organization Chart..................................................................................................................................22 4.8 Personnel ................................................................................................................................................23 4.9 Capital Expenditure ................................................................................................................................24 4.10 MOTOR OIL and Society ........................................................................................................................27 5 PERFORMANCE REVIEW ............................................................................................................................33 5.1 Company Activities ..................................................................................................................................33 5.2 Company Turnover and Earnings Review 2005 – 2007 ..............................................................................36 5.3 Company Balance Sheet Review 2005 – 2007 ............................................................................................40 5.4 Company Key Financial Ratios ................................................................................................................44 5.5 Company Cash Flow Statements ..............................................................................................................45 5.6 Share Performance ..................................................................................................................................46 5.7 Consolidated Financial Statements ..........................................................................................................47 ❚ 4 ❚ annual report 6 AFFILIATED COMPANIES..............................................................................................................................55 6.1 Subsidiaries (direct participation) ............................................................................................................55 6.2 Subsidiaries (indirect participation)..........................................................................................................56 6.3 Companies included in the Consolidated Financial Statements ................................................................56 6.4 Related Companies..................................................................................................................................58 6.5 Other Subsidiaries ..................................................................................................................................59 6.6 BoD Report on Inter-company Transactions according to Corporate Governance Law 3016/2002 ..............59 7 FUTURE PROSPECTS....................................................................................................................................60 7.1 Goals & Strategy ......................................................................................................................................60 7.2 Prospects ................................................................................................................................................61 8 DIVIDEND POLICY........................................................................................................................................63 9 APPENDIX ....................................................................................................................................................65 Invitation to the Annual General Shareholders’ Meeting of May 29th, 2008 ......................................................67 MOTOR OIL 2007 Published Figures and Information (Parent Company and Consolidated) ..............................68 MOTOR OIL 2007 Financial Statements (Parent Company and Consolidated) – Report of the Auditors ............70 Directors Report on MOTOR OIL 2007 (Parent Company and Consolidated) Financial Statements ..................118 Law 3401/2005 Information Bulletin with year 2007 Company announcements ..............................................134 annual report ❚ 5 ❚ 1. Information concerning this annual report and the company auditors This Annual Report contains all the information and financial data needed for a proper assessment of the assets, the activities, the financial position, the profitability and the prospects of the Company "MOTOR OIL (HELLAS) CORINTH REFINERIES S.A" (henceforth called the "Company" or "MOTOR OIL"), on the part of the investors and their investment consultants. Investors interested in additional information may inquire during working days and hours with Messrs. Spyros Balezos (Investor Relations Officer), Philip Malergos (Financial Controller) and Ioannis Dimakis (Corporate Announcements Officer and Shareholders’ Office Head) at the Company Headquarters, 12A Irodou Attikou str., Maroussi 151 24, (tel. ++ 30 210 8094194). This Annual Report was compiled and distributed in accordance with the Hellenic Capital Market Commission decision 7/372/15.02.2006 as it is in force. The following persons are responsible for the preparation of this Annual Report and the accuracy of the data contained herein: ◗ Petros Tzannetakis, Deputy Managing Director – Chief Financial Officer, 12A Irodou Attikou str., Maroussi 151 24, (tel. ++ 30 210 8094162). ◗ Spyros Balezos, Investor Relations Officer - Banking and Investments Manager, 12A Irodou Attikou str., Maroussi 151 24, (tel. ++ 30 210 8094169). The Company’s Board of Directors declares that all its Members have reviewed the content of this Annual Report and jointly with its authors confirm that: ◗ All information and data contained in the Annual Report are complete, true, correct and accurate. ◗ There are no other data, neither have any events occurred, the concealment or omission of which might render the totality or part of the data and information contained in this Annual Report misleading. ◗ There are no legal disputes pending against the Company or the companies in which the Company has a controlling interest that might have serious consequences on its financial position. ❚ 6 ❚ annual report CORINTH REFINERIES S.A. MOTOR OIL FINANCIAL STATEMENTS (PARENT COMPANY AND CONSOLIDATED), CERTIFIED PUBLIC ACCOUNTANTS, TAX AUDIT. The Company is audited by Certified Public Accountants. The regular audit of the yearly financial statements (Parent Company and Consolidated) of the Company for 2005, 2006 and 2007 was carried out by the Auditing Firm DELOITTE, 250-254 Kifissias Avenue, Chalandri, tel. ++ 30 210 6781100 (Certified Public Accountant in charge Mr. George Cambanis Reg. No. ICPA (GR) 10761). The Auditor’s Report for the 2007 annual financial statements of the Company is with unqualified opinion with the exception of a matter of emphasis concerning note no. 29, regarding the current tax position of the Company and of the Group relating to its fiscal years not yet audited by the tax authorities, which has as follows: "The Company has not been subject to a tax audit for the years