ANNUAL FINANCIAL REPORT From 1 January to 31 December 2012 According to article 4 of L. 3556/2007 WorldReginfo - c9919244-266a-4ada-8bb0-8cf2f2faae25 OPAP S.A. Annual Financial Report 2012 TABLE OF CONTENTS I. Representation of the Members of the Board of Directors ........................................................... 5 II. Independent Auditor’s Report (Translated from the original in Greek) ............ 6 III. Board of Directors’ Report for the period 1.1.2012-31.12.2012 ..................................................... 8 A. Financial progress and performances of year 2012 ................................................................................... 8 B. Main developments during the year of 2012 and their effect in the financial statements ........................... 10 C. Main risks and uncertainties .................................................................................................................. 13 D. Prospects for 2013 ............................................................................................................................... 16 E. Related Parties significant transactions .................................................................................................. 18 F. Corporate Governance Statement .......................................................................................................... 20 G. Dividend policy – Distribution of net profit ............................................................................................. 49 H. Number and par value of shares ........................................................................................................... 49 I. Subsequent events ................................................................................................................................ 49 ANNEX ......................................................................................................................... 51 EXPLANATORY REPORT TO THE ORDINARY GENERAL MEETING OF OPAP S.A. SHAREHOLDERS PURSUANT TO ARTICLE 4 PAR. 7-8 OF LAW 3556/2007 ............................................................................. 51 IV. ANNUAL FINANCIAL STATEMENTS .................................................................................. 55 1. Statement of Financial Position ........................................................................................ 56 2. Statement of Comprehensive Income ................................................................................. 57 3. Statement of changes in equity ........................................................................................ 58 3.1. Consolidated statement of changes in equity ....................................................................................... 58 3.2. Statement of changes in equity of OPAP S.A. ...................................................................................... 58 4. Cash flow statement ...................................................................................................... 59 5. Information about the Company and the Group ..................................................................... 60 5.1. General information ........................................................................................................................... 60 5.2. Nature of operations .......................................................................................................................... 60 6. Basis of preparation ...................................................................................................... 60 6.1. New Standards, amendments to standards and interpretations ............................................................. 61 6.2. Important accounting decisions, estimations and assumptions .............................................................. 64 7. Summary of accounting policies ....................................................................................... 67 7.1. Basis of consolidation and investments in associates ............................................................................ 67 7.2. Foreign currency translation ............................................................................................................... 69 7.3. Operating segments ........................................................................................................................... 70 7.4. Income and expense recognition ........................................................................................................ 70 7.5. Property, plant and equipment ........................................................................................................... 71 7.6. Intangible assets ............................................................................................................................... 72 7.7. Goodwill ............................................................................................................................................ 73 OPAP S.A – 62 Kifissou Ave, 121 32 Peristeri, Greece, Tel : +30 (210) 5798800 2 WorldReginfo - c9919244-266a-4ada-8bb0-8cf2f2faae25 OPAP S.A. Annual Financial Report 2012 7.8. Impairment of assets ......................................................................................................................... 73 7.9. Leases .............................................................................................................................................. 73 7.10. Other non-current assets .................................................................................................................. 74 7.11. Financial assets ............................................................................................................................... 75 7.12. Inventories ...................................................................................................................................... 77 7.13. Cash and cash equivalents ............................................................................................................... 77 7.14. Restricted cash ................................................................................................................................ 77 7.15. Equity ............................................................................................................................................. 77 7.16. Income tax & deferred tax ............................................................................................................... 78 7.17. Provisions, contingent liabilities and contingent assets ....................................................................... 79 7.18. Financial liabilities ............................................................................................................................ 79 7.19. Retirement benefits costs ................................................................................................................. 80 7.20. Investment property ........................................................................................................................ 81 8. Structure of the Group ................................................................................................... 81 9. Dividend distribution ..................................................................................................... 81 10. Operating segment ...................................................................................................... 81 10.1. Business segments of OPAP Group of companies, for the years that ended on 31 December 2012 and 2011 respectively ...................................................................................................................... 82 10.2. Business segments of OPAP S.A., for the years that ended on 31 December 2012 and 2011 respectively .............................................................................................................................................. 83 10.3. Geographical segments .................................................................................................................... 84 11. Notes on the financial statements .................................................................................... 84 11.1. Cash and cash equivalents ............................................................................................................... 84 11.2. Restricted cash ................................................................................................................................ 84 11.3. Inventories ...................................................................................................................................... 85 11.4. Trade receivables ............................................................................................................................. 85 11.5. Other current assets ........................................................................................................................ 86 11.6. Intangible assets ............................................................................................................................. 87 11.7. Property, plant and equipment ......................................................................................................... 88 11.8. Investment in real estate properties .................................................................................................. 89 11.9. Goodwill .........................................................................................................................................